Dan O’Malley, the former head of the North Shore AFL-CIO Federation of Labor, said Monday that he is appealing his dismissal for not adequately reimbursing the organization for personal expenses charged to a Federation credit card.
Delegates representing the roughly 150 labor unions that make up the Federation can vote to overturn the board’s April decision that removed O’Malley from his job. He said he has started the appeal process. Delegates would most likely vote in June on whether to return him to the position he had held for more than two years. The Federation is Greater Cleveland’s largest labor organization with about 85,000 members.
“My conscience is clear, and I want to have an opportunity to speak to our delegates,” he told Signal Cleveland Monday. “I am respecting the process, and this is the next step.”
The Federation’s executive board released its findings to delegates on why the board had voted to remove O’Malley. The report, dated May 10, found that he had used the organization’s credit card for personal expenses and then bounced checks intended to reimburse the Federation. The report said that “the Federation does not have an expense policy or a credit card use policy.” However, it said as far back as 2021 the office manager had “advised Mr. O’Malley not to use the Federation’s credit card for personal expenses.” The report doesn’t say what those personal expenses were.
O’Malley denies that he was warned then about using the organization’s card for personal expenses.
“I was never advised,” he said. “All of my expenses were approved on a monthly basis. Until this past February, when these allegations were made, there were never any objections to my expenses.”
The report said the board struggled with removing O’Malley. He had headed the organization for more than two years before being placed on paid administrative leave in February. In addition to removing him, the board debated whether to place O’Malley on unpaid suspension and then impose conditions for him to meet once he was reinstated. Ultimately, the board removed him in a 12-to-4 vote. One board member abstained.
“On one hand, despite his admitted mistakes, Mr. O’Malley has provided some good service to the Federation, and the labor movement often advocates for giving employees a second chance when they make mistakes,” the report states. “On the other hand, the labor movement does not tolerate the use [of] members’ dues money to pay for personal expenses, especially when it involves a high-ranking elected officer, and Mr. O’Malley issued three bad checks to pay for his personal purchases prior [to] the charges being filed.”
The report says that a check O’Malley wrote for $1,158.77 in June 2022 to reimburse the Federation for personal expenses was returned for insufficient funds in his checking account. O’Malley later reimbursed the Federation and told representatives of the staff and the board that “he would not make such a mistake again.”
Then about six months later, in January, O’Malley wrote a check for $592, which he directly sent to the credit card company, to reimburse the Federation for personal expenses. That check bounced. In February 2023, O’Malley wrote a check for $2,300 “to cover his previously returned check and to pay for additional personal expenses he had charged to the credit card.” That check also bounced. The entire board was made aware that O’Malley hadn’t reimbursed the Federation for personal expenses. He was put on paid leave soon after that.
O’Malley still hadn’t reimbursed the Federation as of the April hearing on his case, the report states.
“Mr. O’Malley stated that he had overdraft protection on his checking account and receives alerts when he does not have sufficient funds or overdraft protection to cover an expenditure from his checking account,“ the report states. “Mr. O’Malley testified that he must have missed the overdraft alerts from his bank.”
O’Malley said he doesn’t have any outstanding balances.
“I have reimbursed the Federation for every dollar of what I owed,” he said. “Again, this was something that, In many cases, was simply an oversight. As soon as I became aware of it, I reimbursed the Federation.”
The board investigated O’Malley’s use of the Federation’s credit card after Lynn Radcliffe and Samara Knight, both of the Service Employees International Union District 1199 and both board executive vice presidents, brought charges against O’Malley. The six charges were: Violations of the rules and constitution of the AFL-CIO, violations of the constitution and bylaws of the North Shore Federation of Labor, conduct unbecoming an officer, misappropriation of funds, malfeasance in office and neglect of duty.
The board only found Dan O’Malley not guilty of the violation of the constitution and bylaws and neglect of duty charges. With both, the report said the issue is the Federation’s lack of a credit card policy.
“Bylaws do not expressly prohibit an officer from using a credit card for personal purchases that are subsequently reimbursed by the officer, and the Federation does not have a policy governing the use of its credit card,” the report stated in finding O’Malley not guilty of the constitution and bylaws charge.