UAW’s Jewell Facing 15 Months in Prison for FCA Scandal

DETROIT – The United Auto Workers got another shock as former United Auto Workers Vice President Norwood Jewell was sentenced to 15 months in prison for violating federal labor law and for failing to live up to his responsibilities to union members.

Jewell had pled guilty in April to charges of violating the Taft Hartley Act, which forbids union officials from taking anything of value from employers such as Fiat Chrysler Automobiles. Jewell was the UAW’s top negotiator with FCA US from 2014 until his resignation at the end of 2017.

The sentencing hearing in federal court here highlights the divide between the union’s executive board and its secondary leadership, which interacts daily with union members and suffered the fallout from the unfolding scandal in which union officials lined their own pockets with money set aside for worker training.

In a moment of courtroom drama, Mike Booth, president of UAW Local 961 in Marysville, MI, was summoned by federal prosecutors to the podium in front of Judge Paul Borman.

Booth’s local represents more than 800 UAW members and FCA US employees who build axles used in Ram pickup trucks, Jeep Grand Cherokees and Dodge Chargers and Challengers.

Booth testified that when he asked for help in resolving a contract dispute with FCA US and ZF, the German supplier that manages the plant, Jewell told him the matter was settled. “He told us this isn’t Walter Reuther’s union,” Booth recounted.

“His actions have disenfranchised every member of UAW Local 961, but also future members,” by failing to protect jobs that FCA US wanted outsourced, Booth said. “Norwood Jewell did not act on behalf the union members. This was greed and gluttony,” he said as Jewell sat slumped in his chair at the defendant’s table during Booth’s presentation.

Jewell for his part said his hands were tied during the dispute at FCA’s axle factory in Marysville and denied making the comment about Reuther, the hallowed UAW leader who died in 1970 after spending most of his life empowering the union by winning major contract improvements from Detroit’s automakers.

Union officials from the FCA plant in Toledo, OH, also sent Borman a letter complaining about the resolution of another outsourcing dispute handled by Jewell.

“This is what FCA bought with their money,” Jim Coakley, UAW Local 961 vice president, who was also at the hearing, said during an impromptu press conference after Jewell was sentenced.

“We wanted to be here to show union members that we care,” said Booth, adding the action of Jewell and other union officials caught up in the scandal included illicit payments to Jewell’s predecessor, General Holiefield, and expensive gifts to other UAW representatives responsible for administering the UAW’s pact with FCA.

“This wasn’t a victimless crime,” said David Gardey, chief of the public corruption unit for the U.S. Attorney’s office for the Eastern District of Michigan, who summoned Booth to testify during the hearing about the long-running dispute over work at the FCA axle plant and added Jewell had betrayed union members who were counting on him to protect their interests.

Before handing down his sentence, Borman also said Jewell, the highest-ranking UAW officer to plead guilty to federal crimes, said he believed Jewell violated the trust UAW members had placed in him when he was elected to union office.

Federal prosecutors said Jewell had used money from training funds the UAW had negotiated with FCA US to instead live lavishly with first-class air travel, expensive lodgings and meals and a two-month stay in a villa in Palm Springs, CA.

The expenses were approved by FCA US to curry favor with Jewell, who was responsible for negotiating and administering the UAW’s labor contract with the automaker.

Gardey said Jewell used his access to entertain his colleagues from the UAW board as part of a calculated strategy to advance his own political career within the union. “He wanted to be UAW president. He used them and they used him,” the attorney said.

Jewell, in his defense, said he was told by union lawyers that the deal between FCA, ZF and the UAW had been settled years earlier and there was nothing he could do to change it. But other union officials from the Jeep assembly complex in Toledo said Jewell failed to act on their complaints about outsourcing that violated FCA’s contract with the UAW.

Four FCA officials, including Alphons Iacobelli, the automaker’s former vice president-labor relations, pled guilty previously to charges of violating federal labor laws for their part in the scandal. The company also faces potential fines.

Jewell’s defense attorney Michael Manley (no relation to the FCA CEO with the same name) argued for a lighter sentence of home confinement. The attorney said Jewell, who had spent years working as a union official with General Motors, had been unwittingly thrust into what he described as a “culture of corruption” when he was assigned to lead the union’s FCA department in 2014.

“He was naïve,” said Manley, and trusted his staff, which was operating under the standards set down by General Holiefield, the former UAW vice president who accepted thousands of dollars in illicit payments from Iacobelli and FCA. “He was thrown in a cesspool. Holiefield died in 2015 before he could be charged with federal crime.

Holiefield’s widow, Monica Morgan, has pled guilty to charges of tax evasion.

Prosecutors said, as part of his plea agreement, which cannot be appealed, Jewell has not agreed to provide testimony against any other union officials. 

Jewell joined the UAW as a teenager when he first went to work in a GM factory in Flint in 1979. He became active in local UAW politics, becoming a member of the shop committee at GM’s Flint, MI, Metal Fabricating Plant. He was a leader of the local strike that shut down the GM plant in the summer of 1998.

After the Metal Fab strike, he joined the UAW staff and later became assistant regional director before joining the UAW’s international executive board in 2010.

Under his plea agreement with federal prosecutors, Jewell will be allowed to “self-report” to the U.S. Bureau of Prisons the first week of January. Borman could have imposed $95,000 in fines on Jewell for the Taft-Hartley violations, but Borman elected not to after a review of Jewell’s personal finances showed he had a negative net worth.

Jewell’s sentencing comes at a difficult time for the UAW and Detroit’s three automakers, which are in the midst of negotiating new labor agreements.

The negotiations are expected to be contentious as the union presses for contract gains, while automakers fear a sales slump and worry about the enormous cost of moving into electric and autonomous vehicles.

Officials from both the UAW and FCA US have been trying to move past the scandal.

“The sentencing of Norwood Jewell speaks for itself. The UAW's leadership is determined to earn back our members’ trust with our Clean Slate reform agenda and a take-no-prisoners approach at the bargaining table, where we will draw the line on more concessions to an auto industry flush in profits,” the union said in a statement.

FCA also insisted it was a victim of unscrupulous executives, who stole from the company.

“FCA US firmly restates that it was a victim of illegal conduct by certain rogue individuals who formerly held leadership roles at the National Training Center,” FCA spokeswoman Shawn Morgan said in an e-mail. 

“FCA US also confirms that the conduct of these individuals – for their personal enrichment and neither at the direction nor for the benefit of the company – had no impact on the collective bargaining process,” the automaker statement read.

“Rather, the behavior involved a small number of bad actors who stole training funds entrusted to their control and co-opted other individuals who reported to them to carry out or conceal their activity over a period of several years.”