Andy Stern: The New Boss

Lesley Stahl Profiles The Powerful Union Leader

(CBS)  One of SEIU's big successes in trickle up economics is janitors. You'd think a janitor like Emmanuel Tanis, who works in an office building in New York, would make minimum wage. But he's in SEIU and, with overtime, Tanis made $53,000 last year.

"So what do you think you would earn if you weren't in the union?" Stahl asks Tanis.

"I don't think I would earn nothing," he replies, laughing.

But while he fights like a tiger for service workers, his critics complain Stern shows little concern for manufacturing jobs.

"Here's one of the biggest raps we've heard against you: that you are willing to give up, totally give up on the jobs that have been lost to globalization. What about the jobs that are leaving?" Stahl asks.

"I think I have — you do have," he replies.

"You're not going there. That's someone else's problem," Stahl says.

"No, I think you fight to try to keep in there, just like we fight every time an employer wants to close a hospital," Stern says. "On the other hand, you have to understand the train has left the station of globalization. More will go on. And the question is, is: how do you make sure American workers' jobs, who are still in our country, you know, are jobs that work is valued and rewarded."

Stern spent 10 years as a leader in the AFL-CIO, arguing that the federation's priorities were misguided. He was frustrated that so much money went into supporting political candidates instead of into recruiting new members.

So last summer, Andy Stern did what insiders thought was unthinkable: he marched six million workers out of the AFL-CIO, cutting it by 40 percent, and created a new federation called "Change To Win." The split left the AFL-CIO reeling and it had to cut its budget by 25 percent.

"If you'd stayed in and fought from within, wouldn't the whole labor movement have more clout?" Stahl asks.

"I tried everything I knew how to do for 10 long years," he says. "And the only thing that changed was American workers were doing worse at the end. That isn't the kind of labor movement that anyone needs to be part of."

He says the world changed, but the labor movement didn't keep up with the times. And didn't reach out.

"Whole new industries in Silicon Valley grew up in front of our eyes. New jobs were created and … people never went there. You can't stand still. You can't hold on," Stern explains.

He lashed out at the union bosses for riding around in chauffeur-driven cars and flying around with Democratic senators. Stern never rides in a limo.

Divorced now, he lives modestly in an apartment with his teenage son, Matt. How can you tell a big time union boss lives there? A labor contract is tacked up on Matt's door with the rules of the house.

Stern says three years ago he suffered a tragedy that shattered his life: the death of his 13-year-old daughter, Cassie.

"When she died it broke my heart," he says. "And, you know, it took me a long time to come back. I didn't know if I was going to able to live through it."

He's different now, he says. Not as concerned with whom he might offend. "It just gave me the strength to say, 'Speak out; don't be afraid.' "

One brave thing he's done is pursue a partnership with corporate America. In some labor circles, that's heresy. But he's proud that after SEIU phone operators waged five strikes against the HMO Kaiser Permanente, he got results.

"I pick up the phone. I called the CEO, I said, 'I've never met you before, David Lawrence, but this is a crazy way to do business.' And, yes, we went from a more adversarial relationship to a partnership," Stern says.

A partnership that included a pilot program that gave bonuses to union phone clerks for keeping patient calls short. Designed to help Kaiser reign in costs, it infuriated labor leaders such as Rose Ann Demoro, executive director of California Nurses Association.

"We're talking about someone who's putting their own personal economic interest, a clerk, ahead of that patient's interest because they're going to get more money. We shouldn't put workers in those positions. Not now, not ever," says Demoro.

Other unions have worked out compromises with corporations, like in the auto industry. But Demoro says Stern has gone too far trying to be a buddy to business.

"What Andy has done is to basically go to corporations and ask to be kind of a strategic asset to them and he reinforces and legitimizes what they're doing against working people," she says.