Wads of cash. ‘Relentless’ pressure. Infighting at Unifor. Leaked investigation findings reveal new details of Jerry Dias scandal

Former Unifor president Jerry Dias tried to impede a probe into his conduct and pressured a whistleblower to drop their complaint about an alleged kickback scandal — flouting the union’s code of ethics in the process, according to the findings of a third-party workplace investigation obtained by the Star.

After Dias unexpectedly announced his retirement earlier this year, Unifor revealed it had initiated a workplace investigation into claims that the long-time labour leader received $50,000 from a rapid test supplier he promoted to employers.

Dias’ assistant, Chris MacDonald, had filed a complaint to the union saying Dias offered him half of that money.

The allegations have thrown Canada’s largest private sector union into disarray as Unifor faces its first-ever contested election for national president since Dias assumed leadership in 2013. They also raise crucial questions about accountability and governance within an institution representing 315,000 workers across the country.

In a statement to the Star, Dias’ lawyer Tom Curry said the third-party investigation wasn’t credible, and expressed concern at the circulation of confidential material about a process Dias was “unable to participate (in) because he was dealing with mental health and addiction issues.”

Dias has “always been guided by the principles of the Unifor constitution,” Curry added. “Allegations that suggest otherwise are inaccurate and appear to be part of a desperate bid to benefit politically from attacking him and his legacy.”

In an emailed statement to the Star on behalf of Unifor, Quebec Director Daniel Cloutier said the union is confident in the findings of the investigation. He said Dias had the opportunity to participate in the process, including via written response, and “chose not to.” In their report, investigators note that their findings were made “without the benefit of Dias’ evidence.”

Dias will have further opportunity to respond through a hearing process set out in the union’s constitution, Cloutier said.

“An independent, impartial investigation was proper and necessary to address this serious charge of wrongdoing at the very top of the union.”

The newly obtained documents, including hundreds of pages of union meeting minutes, show the investigation prompted a slew of internal recriminations, with some union staff accusing national secretary-treasurer Lana Payne — who is now running for union presidency — of weaponizing the proceedings to benefit her campaign.

Payne denies that charge and told the Star her decisions were “always guided by the best interest of the union and our members.”

“While others may have sought to influence the investigation, avoid accountability, or spread misinformation to their own personal or political advantage, I have not.”

The Star obtained 1,600 pages of transcripts of National Executive Board meeting minutes spanning February to June. The March meeting contains an executive summary from the third-party investigators, outlining their process and findings.

The Star has not seen the full investigation report that Unifor has pledged to release to its membership, which includes unionized Toronto Star employees. The union has sent executive board meeting transcripts to its locals, Cloutier confirmed.

The meeting minutes include new details about an alleged scandal that involved engraved bottles of cologne, wads of cash and investigators examining whether Dias exerted “relentless” pressure to quash a formal inquiry — and maybe get his assistant to buy his boat.

Also detailed is the mounting dysfunction as Unifor’s senior leadership dealt with the “atomic bomb” dropped on their organization.

“You need to understand our union is at stake at the moment,” Payne told fellow executives in March, before unveiling the investigation’s findings to the group. “It’s in peril.”

Despite pleas for solidarity, the National Executive Board meetings sometimes turned bitter and accusatory, with barbs hurled between those who questioned the credibility of the external investigation and those who wanted to “clean house.”

Payne told union staff that as the investigation unfolded, Dias sought a mediated settlement that would see him retire — in exchange for the union’s silence about his alleged misconduct, according to certified transcripts taken by a court reporter at the meetings. The settlement proposal was rejected.

Curry said he would not comment on settlement discussions, but said Dias “has a long record of successfully resolving disputes at the bargaining table and without subjecting Unifor members unnecessarily to a divisive public spectacle.”

Dias did not participate in the third-party investigation, citing health problems. As previously reported by the Star, a psychiatric assessment prepared for Dias’ lawyer found the union leader was struggling with substance use issues and intense pressure as his retirement loomed, as well as debilitating sciatica.

The investigation’s findings are made on the “balance of probabilities,” the summary says. The name of the rapid test supplier at the centre of the controversy is blacked out, as are the names of two individuals associated with the company. They are referred to as Person A and Person B.

Between December 2021 and January 2022, both Dias and MacDonald promoted rapid tests made by the company to Unifor employers, the report summary says. During that time, MacDonald “acted on Dias’ instructions,” the investigators wrote.

“Person B” at the rapid testing company also “exerted pressure” on MacDonald to “make as many introductions as he could” and implied that the union rep would be “taken care of” for his efforts, the investigators found.

MacDonald told Person B that he did not want or expect compensation, investigators found.

By Christmas, “Person A” had given Dias a bottle of cologne intended for MacDonald, according to the findings.

In late January, having decided to back another assistant — Scott Doherty — as the next Unifor president, Dias invited MacDonald to his office.

There, Dias offered MacDonald half of a $50,000 pile of cash, telling him that he’d received the money from “Person A” at the rapid test supplier, the summary report and meeting minutes said.

MacDonald told Dias they should not accept the money and suggested giving it to a woman’s shelter, according to the investigation.

But the union president “pressured” MacDonald to keep the funds, and suggested he could use it to buy Dias’ boat, the investigation summary says.

MacDonald took the money, but immediately called a colleague — Unifor’s Ontario regional director Naureen Rizvi. He also sought advice from a staff lawyer with the union, and put the money in a secure place at his father-in-law’s house, the investigation says.

Four days after receiving the funds, he verbally notified Payne and handed over the money and cologne bottle, filing an official complaint soon after, according to the probe summary and a statement MacDonald gave to the Star.

Upon learning of a formal complaint against him, Dias “began to exert pressure directly and indirectly on Macdonald to drop” it, the investigation found.

The summary findings say the whistleblower was subjected to “increased pressure,” including through Doherty, who Dias “knew was a friend” of MacDonald.

“There was an attempt to broker a specific arrangement whereby Dias would resign in exchange for MacDonald dropping the complaint, which MacDonald would not agree to do unless Dias admitted what he had done,” the investigator found.

“The investigator finds that Dias’ actions were calculated and driven by his own self interest and preservation.”

Dias told Doherty he had returned his share of the money, the report notes. The union previously told the Star it does not know what happened to Dias’ share of the alleged kickback, and that it handed MacDonald’s half to the police.

Doherty, who was interviewed as part of the probe, was “asked on several occasions” to provide “relevant documentation.”

“To date he has not done so,” the investigators wrote.

In a statement to the Star, Doherty said he fully complied with the investigation. He said he typically communicated with Dias through disappearing messages on the Signal app — and by the time the investigator told him to retain his emails and texts, many old messages were already gone.

Doherty also said he was not aware of the details of the complaint against Dias when he spoke with MacDonald, and never suggested the complaint be withdrawn.

Instead, Doherty said he tried to negotiate a solution that would see Dias resign and publicly acknowledge what transpired. He told the Star he believed that outcome “would not have done as much damage to our Union and our members.”

“I’ve never once tried to cover up for Jerry Dias,” Doherty said in a board meeting, with agreement from MacDonald.

But the minutes suggest MacDonald’s interactions with Dias were fraught: The union president was “relentless” in his contact, once calling at 3:30 a.m. “desperately wanting to figure out how to fix this.”

“I felt pressure days later when Jerry sent me a picture of his wife and said, ‘Don’t take her away from me,’” MacDonald said in meeting minutes.

The external investigation concluded MacDonald shouldn’t have accepted the money from Dias but found his actions didn’t constitute an ethics breach because of how he subsequently dealt with the matter.

Upon receiving the results of the investigation, the union’s leadership gathered in the Sheraton Centre’s Civic Ballroom for a meeting in which Payne detailed the process she undertook upon first learning of the allegations.

As the meeting kicked off, Payne warned attendees that what they were about to learn was “distressing.”

“When I think of the enormity of this and the implications for our union and our members, I’m overcome with emotion. … we all in this room love this union. It is our life’s work,” Payne said.

Payne told her colleagues that as the investigation unfolded, Dias’s team sought a mediated settlement that “proposed a restriction on information that could be released by Unifor to its members or the public.”

“It would have been unacceptable, in my view, to sign onto a secret settlement involving a breach of the Code of Ethics, especially if it resulted in a lack of transparency about what happened for our members,” Payne said in a statement to the Star.

Dias announced his resignation to the executive board on March 11, just days before the union publicly released some details about the allegations against him.

The executive meeting minutes reveal the intensely emotional conversations prompted by the allegations against Dias, a formidable figure described by some senior Unifor leaders as “the greatest person that I’ve ever known” and by another as a “dictator.”

Leaders grappled with how to respect Dias’ right to privacy while also responding transparently to the flood of concerns raised by union members.

“This could really sink us. … the only way of getting out of this is to prove that our organization is not a corrupt one,” said Benoît Lapointe, chair of Unifor’s Quebec Council.

“Our members will likely forgive a mistake but they won’t forgive a cover up,” said Jennifer Moreau, chair of the union’s Media Council.

While there seemed little doubt among leaders about the need for accountability, some questioned whether Unifor’s handling of the allegations was entirely fair to Dias — noting union reps would never discuss individual workers’ issues in front of their colleagues.

“We don’t do this to our members, but we’re going to treat him differently,” said one senior leader.

The minutes do not suggest any of the union’s senior leadership defended Dias against the kickback allegations, but several noted his health issues and said his behaviour with the rapid test supplier was out of character. (Cloutier told the Star no other improprieties involving Dias have been identified.)

Assistant to the national president Katha Fortier told the Star she urged Dias to seek help for both his sciatica and later his substance abuse.

In meeting minutes, Fortier described a basket of designer items gifted to Dias in 2019 by a supplier of union-branded goods, which he refused. “There was a watch there that was probably worth $3,000. And Jerry said to me, ‘Who do they think I am that I would take this?’” Fortier recounted at a board meeting. “In September 2019, Jerry clearly knew the line.”

Dias said the gifts would be returned by his support staff, Fortier told the Star.

The meetings took place against the backdrop of Unifor’s first contested election for presidency — an increasingly fraught battle.

Some senior leaders were furious to learn that Dias knew about the complaint hanging over him when he recommended executives vote to endorse Doherty — against the advice of “multiple people,” said Cloutier. Those executives had no idea about the specific allegations against Dias when they voted.

While Doherty did not stand accused of any wrongdoing, the alleged kickback scandal prompted concerns amongst some senior leaders about an “old boys club” and the “optics” of endorsing “Jerry’s buddies.”

In a statement to the Star, Doherty rejected those claims.

“I have enormous respect and faith in our members in regards to our elections and they will see what is actually happening in the election campaigns and will vote accordingly,” he said. “Note that my slate includes four experienced women, which is hardly an ‘old boys club.’”

Amid the roiling controversy, Payne made a late entry into the election race — running against Doherty and Dave Cassidy, president of Windsor-based Unifor Local 444. Doherty gave up his endorsement from the national board after Payne announced her intent to run.

While colleagues praised Payne’s leadership and steady hand, the board minutes reveal the aftershocks of her sudden announcement — with some colleagues expressing surprise and disappointment that she had not disclosed her intentions earlier.

In a statement to the Star, Doherty said he believed Payne used the investigation as a “political tool to damage our union.”

MacDonald told the Star that the investigators’ findings validated the evidence he provided, and that it was always clear to him that Dias’ actions needed to be reported. But he said he now believed the investigation should have ended “once Jerry confessed.” Dias’ lawyer did not respond to the Star’s question about whether Dias confessed to any wrongdoing.

In June, several Unifor members alleged that Payne abused her position on the national board to make decisions benefitting her campaign, including by canceling a special convention to elect a new president in the wake of Dias’s resignation. The complaints were dismissed by the union’s executive.

Payne told the Star the decision to cancel the special convention was made by the whole executive board, a decision which is under review by an independent office.

“I would not use my position on the Board to benefit my campaign,” she told the Star, adding that under her initiative Unifor has already struck a task force to review lessons of the Dias crisis.

“I decided to run to be Unifor National President because I was concerned about the future of the union and how some responded to the ongoing investigation and the alleged breach of the code of ethics.”

In meetings with the union’s executive, she said she knew her decision would evoke strong feelings — and rejected accusations that she had decided to run as early as January when a domain in her name was registered by her husband.

“I know that some people are mad, upset and angry that I decided to run. I get it, but I have made that decision, and nothing is going to change that,” she said.

“I did not choose to be dealt … this mess. I did not choose to have $25,000 in ill-gotten gains dumped on my boardroom table.”

Clarification — July 20, 2022: This story has been updated to reflect that the 2022 election for Unifor presidency will be the first contested election since Jerry Dias became leader.

Rosa Saba is a Toronto-based business reporter for the Star. Follow her on Twitter: @rosajsaba

Sara Mojtehedzadeh is a Toronto-based reporter covering work and wealth on the Star's investigations team. Follow her on Twitter: @saramojtehedz