GM General Motors Company

By Chester Dawson 

DETROIT -- The head of the union representing thousands of auto workers denied a former Fiat Chrysler Automobiles NV executive who pleaded guilty to violating labor laws unduly influenced the outcome of negotiations between the union and his company.

Dennis Williams, the president of the United Auto Workers, said in an open letter to union members Friday that collective bargaining agreements reached in 2011 and 2015 were not tainted by allegedly illegal payments made by the former executive to senior UAW officials.

"The is simply no truth to the claim that this misconduct compromised the negotiation of our collective bargaining agreement or had any impact on union funds," Mr. Williams said in the letter.

The UAW represents more than 100,000 factory workers employed by Fiat Chrysler, Ford Motor Co. and General Motors Co. It negotiates collective bargaining agreements with the three companies on a quadrennial basis.

The scandal involving the allegedly illegal payments to senior union officials comes at a time when the UAW has faced setbacks in its attempts to organize workers in several foreign-owned automotive plants in the U.S.

Mr. Williams' unusually public statement was issued just days after Alphons Iacobelli, the former head of labor relations at Fiat Chrysler, reached a deal with federal prosecutors. At a district court hearing on Monday, Mr. Iacobelli said he "knowingly and voluntarily joined an ongoing conspiracy" to authorize more than $1.5 million in illegal payments to UAW leaders.

Mr. Iacobelli's lawyer could not be reached for immediate comment on Friday.

A grand jury indicted Mr. Iacobelli in July for what the government alleged was his role to funnel money from Fiat Chrysler through a union training center to top union officials. He pleaded guilty to making those payments and filing a false tax return to hide some $840,000 siphoned from company coffers for his own use, including buying a Ferrari and building a swimming pool at his home.

Federal prosecutors allege the misconduct began in 2009, the same year Chrysler emerged from bankruptcy, and continued through 2014.

The UAW reached a four-year labor deal with the UAW in 2011.

Representatives for Fiat Chrysler could not be reached for immediate comment late Friday, but they have previously referred to a statement last year saying the alleged actions by the former labor executive "were neither known to nor sanctioned" by the company. CEO Sergio Marchionne echoed that position in a July email to employees.

The payments were allegedly made to several union officials, including a now-deceased UAW vice president, General Holiefield, during a time when he was the union's top negotiator for bargaining with Fiat Chrysler.

The union said previously it has removed a handful of officials it believes to have been connected to the alleged conspiracy and launched its own internal investigation into the matter led by an outside counsel.

Write to Chester Dawson at chester.dawson@wsj.com

(END) Dow Jones Newswires

January 26, 2018 19:38 ET (00:38 GMT)

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