The National Labor Relations Board suspended a top-ranking Philadelphia official after receiving complaints that he helped raise money from unions for his pro-union charity.
Dennis Walsh, the regional director for the agency's fourth district, was suspended without pay for 30 days in December after an inspector general investigation revealed that he had misled ethics officers about his tenure as chairman of the Peggy Browning Fund.
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The nonprofit, named after a former NLRB board member, has close ties to some of the major unions that appeared before Walsh’s office, which handles unfair labor practice cases and local elections. The agency inspector general found that nearly 60 percent of Region 4’s casework "involved at least one prohibited source who made a contribution to the Peggy Browning Fund."
Walsh and the NLRB did not return requests for comment.
Walsh disclosed his relationship to an ethics officer in July 2013 when he began work at the agency. He was cleared to retain his position as chairman of the nonprofit’s board after telling the officer that he had "no direct involvement in fundraising."
"I do not directly ask anyone for contributions, and I do not allow my name to be used on any literature that directly solicits contributions," Walsh said. "My role is to run our quarterly meetings, keep track of committee assignments, and responsibilities."
The inspector general found that Walsh’s role extended far beyond that of a figurehead. The November report found that Walsh used his government email account during working hours to conduct business for the pro-union charity. He sent about 1,000 messages pertaining to fundraising and other partisan activities.
The investigation dismissed Walsh’s claim that he was not involved in the group’s fundraising activities, pointing out that invitations from the group advertised him as a member of the events’ "Host Committee" and that his job at the NLRB was advertised on the group’s website.
"Included in the email messages were messages from the Peggy Browning Fund detailing and updating the donations from individuals for the networking functions; draft and edited minutes of Board of Directors’ meetings; and other activity relating to the fundraising activity, general business of the fund, and labor law seminars," the report found. "Email messages in the subject’s Government email account do not support the subject’s assertion that he was not involved in fundraising."
Fundraising events netted the group more than $500,000—about 66 percent of total contributions—in 2014, according to the most recent tax records available.
The agency forced him to resign from the group in August 2015.
"I am compelled to take this action because the National Labor Relations Board, my employer, has revoked their permission for me to participate in the Fund as a Board Member, and permission to engage in such an outside activity is a condition of my employment," he said in an email to the group. "I regret that I am compelled to take this action."
Peggy Browning Fund founder Joseph Lurie refused to comment on the matter.
The investigation began after Philadelphia-based construction attorney Wally Zimolong questioned Walsh’s objectivity. Zimolong raised the issue at the local level, but was dismissed by agency representatives. He then contacted the inspector general’s office and eventually members of Pennsylvania’s congressional delegation.
"The PBF is a union activist organization funded solely with donations from organized labor," Zimolong said in a June letter to lawmakers. "His potential solicitation of donations from labor organizations having business before the NLRB Region 4 is at best an implicit conflict of interest that shakes the public trust and at worst a violation of federal laws."
The suspension and complaints have led to appeals from businesses who appeared before the regional NLRB. Walsh’s office approved a disputed union election in October 2015, less than two months before his suspension.
Attorneys for assisted living facility Devon Manor requested in March that the agency review an election organized by the National Union of Hospital and Health Care Employees Local 1199C. Walsh’s conflict of interest was a focal point of the appeal.
"The Regional Director further raised a question regarding the impartiality of the government in these proceedings by failing to recuse himself," the request said. "The fact that [the union] has arguably donated money to the Peggy Browning Fund and Petitioner and Petitioner’s counsel have ties to and/or participate in the organization required such a result, at a minimum."
NLRB General Counsel Richard Griffin’s office declined Devon Manor’s request to have Walsh testify at a hearing. Another NLRB regional director dismissed the company’s complaint, saying Walsh’s ties to the non-profit "did not create the appearance of impropriety, and did not warrant his recusal."
The inspector general rebutted that conclusion.
"We find that the subject engaged in a course of action that created the perception that his official actions could be influenced in exchange for support of the Peggy Browning Fund," the report said.
Devon Manor’s attorneys at Constangy, Brooks, & Smith argued in an appeal that the agency recognized the conflict of interest when it forced Walsh to resign from the non-profit in August 2015.
"The Decision creates a dangerous new precedent, in that it effectively ignores the glaring appearance of impropriety that was created by RD Walsh simultaneously occupying the incompatible roles of public servant and political activist," the appeal said.