William P. Masselli says he feels just like a "cherry tree" these days.

"Everybody's picking on me," he says.

That's the way Masselli sees it. Others think he's survived rather well since he achieved unwanted prominence last year as a reputed member of the Mafia with ties to Secretary of Labor Raymond J. Donovan and Donovan's company, Schiavone Construction of Secaucus, N.J.

Masselli, for instance, was supposed to start serving a seven-year federal prison term right after the New Year's weekend. He had pleaded guilty last fall to charges stemming from two separate indictments, one for a truck hijacking scheme and the other for a conspiracy to manufacture some $100 million worth of synthetic cocaine.

The prosecutors and judges assigned to his case had already agreed last fall that Masselli could take a trip to Italy before his sentencing. Then they decided that he needn't surrender until after the Christmas holidays. Then they gave him another month, until Feb. 1, on the condition that he pay his fines in the two cases--a total of $37,500--by Jan. 4. Finally Masselli was allowed to put up a $37,500 surety bond instead. The fines needn't be paid until summertime.

He had been facing forfeiture of his main business, Pellegrino-Masselli Meats Co. Inc., until the plea bargain was struck. That danger has disappeared along with the prospect of a maximum 20 years in prison for racketeering.

A 55-year-old businessman who operates out of a windowless warehouse in the South Bronx, Masselli also runs an excavation company, Jopel Construction and Trucking. It took over the assets of a beleaguered Schiavone subcontractor in 1977 and has since grown into a multimillion-dollar-a-year business in connection with New York City subway projects undertaken by Schiavone.

According to the FBI, Masselli is an "alleged self-admitted 'soldier' " in the Genovese family of the Mafia. His private office and business phones were bugged and tapped by government investigators for a fruitful nine-month span in 1979.

In addition to obtaining the grist for Masselli's indictments, the FBI picked up at least one conversation about an invitation Masselli got to fly to some event with "Ronnie Schiavone, president of Schiavone Construction and Ray Donovan." Donovan has denied any social or personal relationships with Masselli, but according to government sources, there are a number of other references to other Schiavone officials and mentions of "Ray" on the tapes.

Despite his indictments last May, Masselli still found time to stand up for his friends--such as Louis Sanzo, president of the mob-connected Laborers Local 29. Sanzo and his local are currently focal points of a new investigation involving allegations of a $2,000 payoff in 1977 in Donovan's presence.

Last June, Sanzo was standing trial on racketeering and tax evasion charges involving more than $200,000 in payoffs from another contractor.

One of the allegations concerned a $1,000 check that Joseph Bastone, the proprietor of a Bronx restaurant where Sanzo used to hang out, said he laundered for the union boss.

The check was made out to "Cash" and government investigators found that Bastone had endorsed it. As a result of that discovery, Bastone, whose record includes convictions for manslaughter, car theft and assault and battery, was prepared to testify that he ran the check through his own bank account in February of 1975 at Sanzo's behest and gave Sanzo the cash one day during lunch.

Before he testified, however, Bastone ran into Masselli in a corridor outside the federal courtroom in Brooklyn. It appears that they adjourned to the men's room for a few words.

Bastone testified as expected but, a few days later, Masselli was called to the stand as a surprise defense witness for his "good friend," Sanzo.

Q. "What did Bastone say to you in the men's room?"

Masselli: "Basically, I asked him what he was doing here and he said he had to testify in a case, Mr. Sanzo's case, and that he hated to do it because he wasn't sure...he didn't know if it was Sanzo or somebody else who gave him the check...but being he testified to the grand jury that it was Sanzo , he was going to say that Mr. Sanzo gave him the check."

The appearance caught the government completely by surprise. The chief prosecutor, James Harmon of the Justice Department's Organized Crime Strike Force in Brooklyn, has told acquaintances that he didn't know of Masselli's reputation and that his investigators didn't either, since none of them was from the FBI.

Even so, "it took a lot of nerve," one government lawyer says of Masselli. Had he been recognized, this lawyer said, "he would have been on the witness stand for a couple of days."

As it was, Harmon responded with a few groping questions. Some dealt with a phony project in the Bronx for which Sanzo had taken $500 from an undercover detective, a project that Masselli said Sanzo once mentioned to him when they were working together on a subway extension in Queens for Schiavone Construction.

But Masselli left the stand without a bruise. He owned up to a previous conviction--for unarmed robbery in the 1950s--but that was all. He made no mention of the twin indictments lodged against him weeks earlier across the river in Manhattan.

Harmon: "You have no interest in this case?"

Masselli: "No, sir."

Harmon: "Who told you this case was being tried, Mr. Masselli?"

Masselli: "It's in the grapevine in the industry that the case is being tried and I had a few minutes and came over."

Harmon: "You own a trucking company?"

Masselli: "Jopel Trucking and Contracting Company. J-o-p-e-l."

The FBI reported at Donovan's confirmation hearings last year that, according to several of its informants, Schiavone Construction was "mobbed up" through social and personal relationships with Masselli. But the FBI said it has not corroborated the claims, and Donovan protested that he had had only a few contacts with Masselli, all strictly business. The Cabinet secretary has disclaimed any knowledge of Masselli's alleged status in the Mafia.

Sanzo, whose union local is allegedly controlled by the Lucchese family, was convicted on income tax evasion and conspiracy charges, but he was found not guilty on the racketeering count, in which the Bastone testimony figured. Sentenced to three years, he is free on appeal.

As for Masselli, he pleaded guilty to sharply reduced charges in the truck hijacking case last September and in the cocaine conspiracy last October. He was sentenced in November to two consecutive terms of 3 1/2 years in the hijacking case and a concurrent term of four years in the drug case--for a total of seven years.

But you can still find him at his warehouse in the South Bronx, trying to "straighten out my affairs."

Hadn't he indicated he was going to fight the charges against him right down to the wire?

"Sometimes," Masselli said, "you're better off getting hit with a couple of punches. Instead of fighting and hurting a lot of innocent people."

He did not elaborate.