UAW boss Shawn Fain investigated by federal corruption watchdog

The court-appointed monitor, Neil Barofsky of Jenner & Block LLP, said in a Monday filing he is investigating allegations that Fain retaliated against another union officer. The 36-page report describes claims of increased stonewalling and non-cooperation by the union, as well as delayed access to documents required under a sweeping consent decree that avoided a full-fledged government takeover in 2020.

The monitor’s report, submitted to the US District Court for the Eastern District of Michigan, poses a liability to Fain, who narrowly won the presidency last year by pledging to eschew top-down leadership and backroom deals that plagued his predecessors. While it’s not yet clear whether the allegations could expose Fain to legal trouble, the document paints the portrait of an organization deeply skeptical of federal efforts to keep the union clean of corruption—a stark contrast to Fain’s public image as a morally centered activist.

The report came the same day the UAW reached a historic contract agreement with electric vehicle battery maker Ultium Cells LLC, a major notch in Fain’s agenda to ease the transition from gas-powered cars. The agreement would more than double wages, from $16.50 per hour in starting pay prior to the union deal to $35 after a year on the job, building on gains made during a 46-day strike last year against the three Detroit automakers.

Fain also led a campaign to unionize a Volkswagen plant in Chattanooga, Tenn., in April, landing the first major union victory in the South in decades. But momentum sputtered a month later when Mercedes workers in Vance, Ala., decisively rejected the union.

The report identifies at least two union officials who say they faced retaliation for not approving certain expenditures sought by Fain. Barofsky’s investigation zeros in on a recent incident where Fain stripped duties from an unnamed union vice president overseeing the UAW’s relationship with Stellantis, reassigning the division under his own control May 29, citing the official’s “dereliction of duty” related to collective bargaining. That vice president was identified by the Detroit Free Press as Rich Boyer.

Barofsky said he later received allegations from that official, and other unnamed union staff, that Fain’s reasoning was false.

The real reason, they said, was that the vice president refused “to engage in acts of financial misconduct to benefit others.” The report doesn’t say whether Fain is personally accused of misconduct, and suggests that the allegations remain unverified.

“At this stage, it is important to emphasize that the allegations are just allegations,” it said. “They prove nothing in themselves, and nothing in this Report should be construed as reaching any conclusion about possible charges, if any, for suspected misconduct.”

In a statement, Fain denied the allegations and said they stem from his efforts to change the union.

“Taking our union in a new direction means sometimes you have to rock the boat, and that upsets people who want to keep the status quo, but our membership expects better and deserves better than the old business as usual,” Fain said. “We encourage the Monitor to investigate whatever claims are brought to their office, because we know what they’ll find: a UAW leadership committed to serving the membership, and running a democratic union. We’re staying focused on winning record contracts, growing our union, and fighting for economic and social justice on and off the job.”

But perhaps just as damaging are allegations that the union has virtually stopped cooperating with—and in some cases, is obstructing—an array of investigations after the monitor began looking at top officials. Barofsky’s report says the union’s cooperation began to erode in February after he started investigating Fain, Secretary-Treasurer Margaret Mock, and a union regional director.

According to the report, the UAW has slow-walked documents related to an executive board decision in February to curtail some of Mock’s power. The US Department of Justice backed up the monitor’s account in the report, saying the union “is making it difficult, if not impossible, for the Monitor to fulfill his mandate to remove fraud, corruption, and illegality from within the UAW.”

The investigation of Fain is tied to another probe into an executive board decision to curtail Mock’s power. The board in February voted to strip Mock’s oversight of certain departments in response to allegations that she withheld funds for political leverage, and didn’t approve supplies for the strike last fall.

Mock, in response, said the move was retaliation for “refusal or reluctance” to authorize expenditures that would benefit Fain’s office, according to the report.

The case is US v. UAW, E.D. Mich., No. 20-cv-13293, status report 6/10/24.