Wednesday, December 2, 2009

Former Firefighter’s Union Chief Fighting City over IRS Reversed Benefit

The former head of San Diego firefighter’s union is fighting the city for not paying retirement benefits that was canceled after the IRS concluded that it violated federal tax laws.

The civil lawsuit was filed against the city by Ron Saathoff last September to repeal an ordinance that cancelled the benefit.

The conflict stemmed from the “presidential leave” benefit that would let Saathoff combine his salary as president of the International Union of Firefighters Local 145 with his salary as a city worker in determining his pension.

However, the benefit was cancelled and is actually a part of 2 pending criminal charges involving Saathoff and other city pension board.

The criminal charges allege that Saathoff and other board members engaged with self-dealing and fraud by approving a city proposal that put less money in the pension system than required while the city is agreeing to pay out more benefits in labor contracts.

According to Saathoff and his lawyer, the city lawfully entered in those benefits and it is obligated to perform on both of them.

A spokesman from the City Attorney’s office argued though that the benefits were approved with no ordinance and no vote; just as the city cannot take away retirement benefits without an ordinance and a vote of the membership, individuals cannot get special benefits without them.

The best bet of Saathoff to win this case is to prove that the benefits were legally approved by the city and that the IRS reversal was not justifiable.

The prosecutors would in turn try to show Saathoff and the other board members as self serving people who want to get more than what they contribute.

In my opinion, the IRS have already declared that the benefit is illegal and against federal tax laws.

The government has every right to take away a benefit that was passed by the people who are also the ones who stand to benefit from it.

Trade Unions are there to serve the interest of the workers who they represent, not to use their bargaining powers as leverage to get advantages over others.