Agriprocessors’ Rubashkin denied new trial



Former Agriprocessors executive Sholom Rubashkin was denied a new trial by a U.S. appeals court.
 The St. Louis Court of Appeals ruled Sept. 16 that Rubashkin did not prove in his bid for a new trial that the presiding judge in the original case, Linda Reade of the U.S. District Court for the Northern District of Iowa, should have recused herself because she was involved in planning the May 2008 federal immigration raid on Agriprocessors that led to the company’s bankruptcy later that year.

 

Rubashkin, the former head of what once was the nation’s largest kosher slaughterhouse and packing plant, located in Postville, Iowa, was convicted of financial fraud in 2009 and sentenced to 27 years in prison. Rubashkin is in a federal prison in New York state.

In the federal raid on the plant, 389 illegal immigrants were arrested, including 31 children.
The appeals court also disagreed with Rubashkin’s contention that the sentence was too long.

A Rubashkin attorney told the Des Moines Register that his client would appeal the decision to the U.S. Supreme Court.
 


Seeking a pay increase, Bet Tzedek employees picket


On June 14, employees at Bet Tzedek, a Jewish legal-service organization, demonstrated in front of the organization’s office at 145 S. Fairfax Ave., calling for higher wages. Bet Tzedek — which means “House of Justice” in Hebrew — is a nonprofit that provides free legal services to Jews and non-Jews in Los Angeles.

The Bet Tzedek employees — lawyers, legal secretaries, paralegals and clerical workers — want pay increases of approximately 2 percent, according to Marc Bender, an attorney at Bet Tzedek and president of Bet Tzedek Legal Services Union, which has 54 members. 

“We’re not asking for the moon,” Bender said. “We feel that Bet Tzedek can afford that.” The employees’ health care and pensions are also at stake, but the dispute over the wage increase has been the focus of the dispute.

As of June 15, Bet Tzedek management had agreed to an approximately 1 percent raise for its employees, Bender said.

Bet Tzedek CEO and president Sandor Samuels, who has been negotiating directly with the firm’s employees on behalf of management, would not confirm the percentages but said the employees have asked for a higher pay increase than management can afford.

“We are trying to properly balance what our employees would like with our ability to make sure that we can raise the money to operate at this point,” Samuels said.

“I’m looking forward to both sides getting back to the negotiating table so we can this thing resolved.”

As with many nonprofits, the economic downturn has affected the Bet Tzedek employees’ pay. In 2009, their wages were reduced, but in January 2011 they were reinstated to the level that they were prior to the recession.

As of last week, Bet Tzedek employees were not considering striking and expressed hope that their demands will be met.

“We’re hoping the informational picket will break the log-jam,” Bender said of the action, which drew approximately half of Bet Tzedek’s union members.

The nonmanagerial employees of Bet Tzedek have not received raises since 2008. The employees receive different pay but are subject to the same contract terms. Negotiations began six months ago, after nonmanagement employees’ contracts expired in January. Since then, the negotiations have been ongoing.

Federation Faces Underfunded Pension


Faced with a pension shortfall of $20 million, the organized Jewish community’s largest philanthropy finds itself forced to divert millions of donor dollars to employee retirement benefits, rather than to needed social services.

To cover the underfunded pension, The Jewish Federation of Greater Los Angeles and its 13 beneficiary agencies are slated this year to contribute $5 million to retirement plans, up from $4 million just two years ago. That means about 10 cents of every payroll dollar now goes to pensions, a higher percentage than at many other federations.

By contrast, the Jewish Federation of Greater Philadelphia spends about 3.5 cents on pensions, the Combined Jewish Philanthropies of Greater Boston about 4 cents, the Jewish Federation of Greater Atlanta about 4.5 cents and the UJA-Federation of New York 6 cents.

In addition to restricting cash that could be used for other purposes, the Los Angeles Federation’s underfunded pension has caused headaches for the agencies gaining their independence from the Jewish Community Centers of Greater Los Angeles (JCC) , a Federation beneficiary agency. The pension shortfall means that the Westside JCC, the Zimmer Children’s Museum and Valley Cities JCC might be responsible for paying off their share of the pension liability, a financial burden that could saddle them with tens of thousands of dollars in extra costs.

"I’d say it’s a concern, but I wouldn’t characterize it as a big concern," Federation President John Fishel said of the underfunded pension program, adding that the agency would cover all present and future pension payments owed to 120 retirees and 956 current employees.

However, agency heads speaking on background said the pension shortfall had made it more difficult to hire people, give raises or expand programs. They also worried that the relatively high contributions they’re now making could persist for years, putting a long-term financial strain on their organizations.

Whatever size the concern, it isn’t unique to The Federation. Corporate America has also experienced pension problems in recent years. Billions of pension fund dollars invested in the market vanished when the high-tech bubble burst and stocks plummeted.

Although Wall Street has come back some, U.S. businesses recently reported a pension shortfall of $278.6 billion, said Loretta Berg, spokeswoman for the Pension Benefit Guaranty Corp. in Washington, which is charged with protecting private-sector pensions of 44 million American workers and retirees.

California counties and cities are also struggling with pensions. Orange County, for instance, has shortfall estimated at $1 billion.

The amount of an unfunded pension liability often reflects how much money a company would need to pay off all earned retirement benefits if it terminated its retirement package.

Pension expert Lou Kravitz said The Federation’s shortfall, along with many companies’ pension problems, would likely disappear or shrink considerably in the next five to 10 years, as the stock market and interest rates rise as expected. Typically, pension liabilities move in the opposite direction of stocks and interest rates, said Kravitz, a former member of The Federation’s pension committee and head of the retirement plan consulting firm, Louis Kravitz and Associates in Encino.

"The amount of underfunding goes up and down, so it’s not something you necessarily should lose sleep over," he said.

Jack Klein, Federation executive vice president and chief operating officer, said his agency has addressed the agency’s pension shortfall by gradually raising plan contributions over the years and by changing the mix of stocks and bonds in which retirement dollars are invested. He also said The Federation and its agencies have 30 years to pay down the underfunded pension plan, more than enough time.

"I think The Federation, agencies and lay leadership have done a very good job of managing the pension fund," Klein said.

Agency executives agree — to a point. The Federation’s pension plan is "a great benefit that has kept people in the Jewish community, but it might be proving too expensive to maintain at its current level," said Andrew Diamond, president and chief executive of Aviva Family and Children’s Services.

Mitch Kamin, executive director of Bet Tzedek, another benificiary agency, said the plan has been great for worker retention. However, the costly benefit could be less appealing to more junior workers who might prefer the flexibility and portability offered by other options.

In an attempt to cut pension costs, The Federation has proposed modifying retirement plans for new employees, although benefits for current staff would remain intact.

Instead of offering new hires so-called "defined-benefit" plans, which guarantee an annual fixed income, The Federation now favors "defined-contribution" plans. Under those plans, employers set aside money for workers to invest in stocks and bonds of their choosing.

However, with defined-contribution plans, "the risk of the pension is in the hands of the employee," said Brett Trueman, a professor of accounting at the UCLA Anderson School of Management. In other words, if the market falters and wipes out workers’ nest eggs, corporations and nonprofits have no obligation to make up the losses, he said.

Locally, most nonprofits appear to have retirement plans that are both less generous and less costly than The Federation’s. A recent survey of 252 mostly Southern California nonprofits found that nearly four out of five offered benefits, but only 6 percent had defined-benefit plans like The Federation’s, said Pete Manzo, executive director and general counsel for the Center for Nonprofit Management in Los Angeles. That’s down from 13 percent a decade ago, he said.

"Nonprofits want to maximize their program activities, just like for-profits want to maximize shareholder value," Manzo said. "So they want to cut or contain costs."

Federation President Fishel said a lack of consensus among The Federation and beneficiary agencies led the organization to stick with the defined-benefit plan until now. Beginning in the early 1990s, The Federation reduced contributions from 6.6 percent to 3 percent and later to 1.5 percent. At the time, organization executives believed that the pension fund was flush or overfunded.

Jon Lepie, chief negotiator for the American Federation of State, County and Municipal Employees, Local 800, the union representing about 450 Federation and agency workers, said it appeared The Federation may have acted irresponsibly by lowering contributions. Without that tinkering, The Federation might have avoided the underfunding problem and the need to move away from defined-benefit retirement plans, which give workers more security and often more money than other options.

Fishel said the philanthropic agency used the savings from the lower rates to help "stabilize" Federation and agency programming that experienced significant funding cuts in the early 1990s. Later, The Federation and the agencies dipped into that money to raise salaries across-the-board. Klein, The Federation’s COO, added that the organization’s pension contributions have always exceeded legal requirements.

Union officials representing The Federation and beneficiary workers have reacted unenthusiastically to The Federation’s proposal to scrap defined-benefit pensions for new workers, although they have not ruled out accepting the offer as part of larger negotiated settlement.

"If we’re forced into cutting employment benefits because of management incompetence, shame on them," Lepie said.

Local 800 President Jeff Rogers said that The Federation had failed to live up to its contractual obligation to invite a union representative to pension committee meetings over the years. The presence of a union member might have "protected the pension," he said.

Klein declined to respond to Rogers’ charge, saying that it was inappropriate to do so at this time, because of the ongoing negotiations with the union.

Officials at the United Jewish Communities, the umbrella organization for the nation’s federations, said they had no information on the types of pension plans offered by individual members. However, several federations appear to have healthier retirement funds than the Los Angeles Federation’s.

The Atlanta Federation offers defined-benefit pensions like the local Federation’s but has no shortfall.

The Philadelphia Federation offers defined-benefit pensions to its employees and workers at 13 beneficiary agencies. The plan, which is underfunded by $1.5 million, offers benefits that are in some cases about half as generous as the Los Angeles Federation’s. Still, four agencies have recently dropped their defined benefits in favor of defined contributions, said Angela Falcone, Philadelphia’s chief financial officer.

The United Jewish Federation of San Diego County, like Atlanta, Boston and New York, has no underfunded pensions. The organization offers its employees a 403(b), the nonprofit version of a 401(k), and a defined-contribution plan.

Reflecting on the Los Angeles Federation’s situation, Elias Lefferman said change is in order. The president and chief executive of Vista Del Mar Child and Family Care Services said beneficiary agencies could no longer afford to set aside an increasing percentage of donor and grant dollars for underfunded pensions.

"We need a new plan," he said.

Matchmaker, Matchmaker Find Me a Job


Benjamin Brown found out a master’s degree in Jewish history didn’t help him much in finding a job. So a few years ago, Brown, 29, launched an employment Web site for the Jewish community, which he named JewishJobs.com. The initiative seems to have been a success: Brown not only secured a job at the now-defunct United Jewish Communities’ (UJC) Trust for Jewish Philanthropy, he has attracted more than 6,000 job seekers to his service, which boasts a testimonials page of happily matched employees and employers.

Brown’s story is telling both about the need to match potential candidates with Jewish jobs, and about the rising number of Internet job sites that serve niche markets

Employers appreciate receiving 70 strong candidates instead of 7,000 who may not be appropriate for the job, said Brown, who left Brandeis in 2001 and received his master’s degree earlier this year.

JewishJobs.com is by no means the only Web site looking to play matchmaker between job seekers and Jewish employers.

Web sites and services like J2J Network, Hatzlacha.com and JewishJobFinder.com, among others, have sprouted up over the past few years, and the Orthodox Union recently announced it will launch an online job bank.

It’s an economic thing, say those involved in the field.

J2J, a self-described network for Jewish professionals, has hosted networking events, run educational programs and provided a career listserv of employment opportunities since 2000, with the goal of strengthening the Jewish community through commerce.

"If I get a random e-mail, I may or may not respond," said David Borowich, chairman of J2J, whose users tend to be 25-45. "An e-mail from the Jewish community, I am more likely to respond."

Unlike JewishJobs.com, J2J does not focus on specifically Jewish jobs. Weekly e-mails advertise jobs in public relations companies and law firms, as well as in banking and consulting groups.

With tight networks in mind, UJC launched its own initiative in 2001 that helps technology professionals find a job.

Blue Knot: The Jewish Tech Initiative (www.blueknot.com) emphasizes networking for its mostly young and transient members, who attend professional gatherings and community service events. The idea is to bring together technology professionals in the Jewish community from across the country who are interested in networking and in getting involved in the Jewish community.

Clothes Call


There was a time when the retail clothing industry was thriving.

“In the ’80s, my customers spent almost 8 percent of their disposable income on clothing,” said David Sacks, owner of Sacks SFO apparel stores.

However, time and a change in consumer habits have eroded this reality. Over the last decade, Sacks, 53, has had to close several of his outlets. He watched his retail miniempire dwindle from 20 stores nationwide to two local outlets: one in Studio City (12021 Ventura Blvd.) and a new location in Culver City (9608 Venice Blvd.).

“We’re going back to our roots,” Sacks said. From the onset, Sacks’ intention was accessibility.

“My mission goal is to provide people who work for common jobs to dress in uncommon wardrobe,” Sacks said. “To make a guy who makes $30,000 dress like a guy who makes $100,000. I’m very value-driven, not label-driven. I don’t care what labels I stock, as long as they look good and are of good value for my customers.”

That accessibility is not only found in the merchandise sold. It also extends to Sacks himself, who runs a hands-on business, where he enjoys schmoozing with his customers at his stores.

“I’ve never been in it for the money,” he said. “I didn’t want to work for someone else, but I don’t want to lose money. My employees will see a raise before I do.”

Sacks retreated into a back office, where he offered what he jokingly calls “my Horatio Algerstein story” — the origins of a hometown boy who grew up in a Conservative kosher home in Cheviot Hills and attended Hamilton High School and UCLA.

Sacks’ parents met at Indiana University. His mother, of Lithuanian descent, came from a well-to-do family that ran a department store in Terre Haute, Ind. His father, of Romanian and Ukrainian heritage, put himself through medical school selling sandwiches. He moved his wife to Los Angeles, where he became a prominent pathologist and later built the pathology department laboratory at Cedars-Sinai Medical Center.

Sacks was something of a rebel during his school days.

“I went before the principal for buying candy and selling it on campus,” Sacks said.

That was in the second grade. A few years later, when the new pennies were released in 1959, Sacks made some pocket money selling two pennies for a nickel. By the fifth grade, he was winning poker games.

“I didn’t need an allowance again,” Sacks said. “I was lending money to my brother [Phillip Sacks, now practicing general dentistry in Woodland Hills].”

During the 1960s, Sacks continued hustling.

“I sold unreleased Bob Dylan recordings before bootleg tapes were deemed illegal.”

Then Sacks became a phlebotomist, one who draws blood for transfusions.

“That was rather boring,” he said.

The boredom ended the day when he accompanied his bridge partner downtown to the garment district. Sacks convinced a supplier to give him a dozen items to sell. Sacks sold them off his arm in office buildings.

“I was originally thinking of calling it ‘Lost on Horizon,'” Sacks said, referring to the original Horizon Street location of his first store, next to the Sidewalk Cafe on the Venice Beach boardwalk.

But instead, he called his clothing outlet Sacks Fifth Off, and Saks Fifth Avenue didn’t share his amusement. After two years of legal wrangling, an agreement was reached between the two parties, and the chain’s current moniker, Sacks SFO, was born.

Twenty-five years later, Sacks now resides with his wife, Nikki, in Cheviot Hills. He has two grown children — Anthony, 26, a technical theater apprentice, and Andrew, 24, a substitute teacher.

A few years back, Sacks started a Giver’s Club, giving customers a 10-percent discount off of store items in exchange for clean clothing donations. The donated clothing goes to shelters that help battered women and AIDS hospices.

Sacks takes the clothing business in stride.

“I never had the foresight or the money to buy the buildings. My last big downsize came after the Northridge earthquake,” said Sacks, who had already been stung by the Los Angeles riots.

Despite its ups and downs, Sacks wouldn’t trade his experience for anything.

“The best part is that I’ve made friends with people all around the world,” Sacks said. “It’s an immigrant’s business. People are very bright, but may not have formal education. I’ve met people from every continent, and every religion.”

Federation Lay-Offs Total 30


The streamlining continues at The Jewish Federation of Greater Los Angeles, the city’s biggest nonprofit outreach organization. A total of 30 positions were cut; 20 union and 10 nonunion. In the past month, buzz among Federation employees was that anywhere from 30 to 40 positions would be cut from all three local Federation outlets.

The Journal has learned that dismissed employees include Senior Associate Campaign Director Lee Rosenblum; ACCESS Chair A.J. Adelman; Campaign’s Danny Nathanson and Mark Friedman; lower-rung employees of the Jewish Community Relations department; as well as personnel in Tel Aviv-Los Angeles Partnership, communications and other departments.

Federation Marketing and Communications Director Craig Prizant said that 30 is the final total on the lay-offs.

A Federation insider observed that, due to union rules, union employees with seniority have the option of taking other union workers’ positions. However, the process is based on seniority and not based on whether these employees are right for the job. Union employees get bumped to the lowest positions — those at the bottom with no seniority lose their jobs.

"It was pretty much across the board; not one specific area they came out of," said Prizant. "It’s tied into the reports on the economy. We chose to take an administrative cut versus the money allocations in the agencies. We’ve chosen to cut ourselves rather than to cut into the most vulnerable communities."

In addition to the economy, Prizant pegs post-Sept. 11 hikes in security, health and insurance costs as deciding lay-off factors.

The job cuts, according to Prizant, will save the local Federation system roughly $3 million.

"We are a family here and we are taking caring of our own," said Prizant, in reference to offering the laid-off employees services from Jewish Vocational Service, Jewish Family Service and other Federation agencies.

Federation Chairman Todd Morgan described The Federation’s decision to downsize as "unpalatable in the short term to maintain the vision of the long term."

"It’s a tough situation," Prizant added. "People are not totally surprised. You don’t have to be a genius to see the economy. When it happens to you, it’s very difficult. As John [Fishel, The Federation’s president,] said, it’s the most difficult thing he’s had to go through in his career."

Protest for Labor Rights


For the past four years, the predominantly Latino hospitality and housing employees at the University of Southern California have been fighting for a written guarantee of job security. Now, union leaders representing the workers have turned to Jewish leaders to support what they consider a call for justice.

The labor dispute began in June 1995, when the contract between USC and Local 11 of the Hotel Employees & Restaurant Employees Union expired. Since then, USC has refused to renew a contract under terms that would preclude the possibility of hiring subcontractors, which union leaders see as a threat to the 360 workers’ job security. A rolling hunger strike on behalf of the workers, now termed “The Fast for Justice” began in May when Local 11 President Maria Elena Durazo fasted for 11 days. The fast has since been picked up by Los Angeles religious and political leaders.

In response to the protests, Phil Chiaramonte, Associate Vice President of Auxiliary Services, said that USC has no intention of replacing union workers with subcontractors, but would like to reserve the right to hire subcontractors should the university need to meet unexpected economic and market changes.

“We have indicated more than once that we have no current plans to subcontract those positions,” he said.

In fact, the university, the largest private employer in Los Angeles, has implemented programs to ensure job comfort and stability. Computer, math and ESL courses have been created for the staff. USC arranges for summer job placement for its employees at Universal Studios during the park’s peak season, as work diminishes at USC during the summer. Longtime employees have sent their children to USC on remitted tuition, a benefit the workers cherish for the opportunity it gives their family for higher education.

Many USC hospitality and housing workers agree that they have been treated well. That is why Alex Rivera, one of the more vocal union members, is all the more concerned that he and his fellow workers may lose their jobs.

Rivera, head waiter to USC President Steven Sample and waiter supervisor, has worked at USC for 32 years. He distrusts university officials when they say they will honor their jobs in the event that they hire subcontractors. He cites an episode two years ago when janitorial workers lost their jobs to subcontractors even after university officials claimed that would not occur.

At one of the university restaurants, employees on the job were quick to echo Rivera’s concerns. It was a slow day, but Miriam Siegler was reluctant to speak when managers were around. She says many workers are too intimidated to protest. Some who demonstrated at last year’s commencement were temporarily suspended which, according to officials, was justified since they did not report their absence from work.

“It’s hard when you’re poor and you have to fight with people who are really powerful,” Siegler said.

Jewish leaders who have been known to support labor causes in the past have joined with the union to bring more power to the side of the workers. Jewish support peaked last week on July 22, Tisha B’av afternoon, when about 150 Jewish leaders and Latinos united in front of the historic Breed Street Shul located in the heart of Boyle Heights to support the USC workers in their struggle for job security.

The gathering coincided with Tisha B’Av, to mark the continuation of the Fast for Justice and to commemorate the similar struggles of Jews and Latinos.

At the event, Rabbi Steven Carr Reuben of Kehillat Israel, Rabbi Aaron Kriegel of Temple Ner Maraav, Rabbi Marvin Gross of the Jewish Labor Committee and West Hollywood Councilman Paul Koretz pledged their commitment to the workers’ cause. Many of these same leaders were active in pressuring the management of the Summit Hotel Rodeo Drive to settle a labor dispute with employees last year.

Irv Hershenbaum of United Farm Workers, Los Angeles Councilwoman Jackie Goldberg, Eric Gordon of the Workman’s Circle and Rabbi Denise Eger of Congregation Kol Ami, spoke of their natural sympathy with members of the Latino community. Their parents and grandparents were also hard-working immigrants, many of whom settled in East Los Angeles, in search of a better life for themselves and their families, they said.

“The Jewish community has a long and proud history of being active in the labor movement and having an investment in Boyle Heights where many of the lowest-paid, least secure workers at USC live and raise families today,” said Scott Svonkin, a Koretz aide and Jewish activist who helped coordinate the event.

Jewish outcry comes at a time when USC enjoys improved Jewish relations. In the past decade, USC has reached out to Jewish alumni and increased it’s number of Jewish faculty to approximately one third.

In a statement forwarded to the Journal, USC trustee Kenneth Leventhal accused union leaders of manipulating public opinion to gain strength at the bargaining table. “As a Jew and as a USC trustee, it saddens me and sickens me to see the union attempt to link a sacred Jewish fast day with this dispute,” Leventhal said.

“We, the members of the Jewish community, give notice to President Sample that we have waited long enough,” said Kriegel, who is participating in a boycott call to Jewish donors to halt donations to USC until an agreement is reached.

Meanwhile, negotiators are working to resolve the issue. Possible solutions include consulting with the union before the university subcontracts or ensuring the right of the university to subcontract on condition that current workers are given first preference.