A local union is handing out flyers accusing the Sheraton Commander Hotel of hiring non-union workers and asking visitors to boycott the establishment.

The Carpenters' Union Local 40 of Cambridge charges that the Sheraton is paying non-union workers substandard wages and providing insufficient fringe benefits.

Sheraton General Manager James Collins said that last November the hotel solicited bids from construction companies for a job remodeling its fifth and sixth floors. He said the lowest bidder was Felsway, Inc. of Medford, which outbid the Carpenter's Union for the job.

David Peabody of Local 40 yesterday criticized Felsway for hiring workers from outside this area. They bring in people from New Hampshire, and God knows where," Peabody said.. The flyer, which Peabody wrote, argued that the purchasing power of a community falls when wages drop below union scale.

But Sheraton officials said yesterday that the union drive was misplaced.

According to Collins, the union should not complain to the hotel, but should speak to the non-union contractor that got the job. "They don't have a lot to get at Felsway, so they're coming at us," said Collins.

The handbilling has not affected business, Collins said. He added that the dissatisfied workers had been "very courteous" in their attempts to publicize their grievance.

Peabody said the Sheraton had employed union workers in the past. Union officials said the recent move to contract Felsway came as a surprise to the Carpenters' Union.

'No Trouble' Wanted

Felsway workers on the sixth floor of the Sheraton refused to comment on their jobs yesterday.

"We're carpenters, they're carpenters," said a representative of the non-union contractor. "We don't have any trouble with the union, and we don't want any trouble, and you don't want any trouble with me," he told a reporter. He said he did not want to criticize the Carpenter's Union because he was a carpenter himself.

Richard Mulvey, a union member, was passing out flyers to passers-by at the entrance of the Sheraton today. He said outside contractors are taking away his business. "The unions offer benefits and wages to live on," he said. Mulvey also charged that non-union contractors did not hire women or minorities. One of the Felsway workers in the Sheraton yesterday was Black.

Felsway continues to remodel under the contract signed in November, and members of the Carpenter's Union Local 40 say they plan to keep handbilling the Sheraton Commander.