Hunton Employment & Labor Perspectives

In a highly anticipated decision, the U.S. Supreme Court ruled that public employee unions may not collect involuntary fees from the public employees they represent.  Janus v. AFSCME, U.S., No. 16-1466, 6/27/18.  Here are the key points of the court’s decision:

Janus involved state employees represented in a bargaining unit by an Illinois public employee union.  The union was the exclusive collective bargaining representative of all the employees in a bargaining unit.  The union bargained with the State of Illinois for a collective bargaining agreement covering the employees in bargaining unit.  The union also engaged in other activities not directly related to the bargaining and administration of the collective bargaining agreement.

Under Illinois law, state employees represented in a bargaining unit are not compelled to be members of the union or pay union dues. But they must pay an “agency fee”, an amount equal to that portion of union member dues spent directly on bargaining and administration of the bargaining agreement.

Some members of such a bargaining unit complained that they did not agree with positions taken by the union in bargaining with the State of Illinois  They further claimed that payment of the involuntary agency fee was a form of coerced speech, in which they were forced to support the union’s positions with which they disagreed.  This, the employees argued, abridged their First Amendment rights.

The Supreme Court agreed with the employees and ruled that public employees may not be compelled to pay an involuntary agency fee to a union representing them.  In doing so, the Court overruled its decision in Abood v. Detroit Bd. Of Ed., 431 U.S. 209 (1977).

The Court decided that the concerns that supported Abood  -- labor peace and avoiding so-called “free riders” – were no longer valid.  Labor peace (i.e., the avoidance of disruption by competing unions representing employees in a given bargaining unit) is achieved through a union’s exclusive representation of employees in the unit.  Agency fees add nothing to that exclusivity.  Further, experience has demonstrated that free riders have not been such a problem as to keep unions from vying to represent public employees.  The free rider problem, to the extent it exists, does not justify the imposition of involuntary agency fees.

The respondent union was unable to articulate any other rationale for supporting the involuntary fees.  The positions taken by the union in bargaining were taken on behalf of employees on matters of public concern. The imposition of the involuntary agency fees coerced the employees into supporting the union’s speech notwithstanding that the employees disagreed with the positions the union was taking.  If anything, the Court observed that the First Amendment’s protection against coerced speech is at least equal to, if not greater than, its protection against censored speech. In any event, there was no sufficient government justification to support the involuntary agency fee.

One question not resolved in this case is the level of scrutiny the Court would use in analyzing the First Amendment issue – “exacting” scrutiny used in  previous cases involving government limitations on employee speech, and in commercial speech cases – or the more rigorous “strict” scrutiny generally employed in First Amendment cases involving individuals outside the government employee category.  The Court did not resolve the issue because “the Illinois scheme cannot survive under even the more permissive” exacting scrutiny standard.  Slip op. at 11.

Finally, it remains to be seen what the full  practical and legal impact of Janus  will be.  Will the flow of funds to public employee unions be greatly reduced now that states may not compel agency fees?  Will the decision provide support for attacks on private sector union shop clauses, that  are permitted under the National Labor Relations Act and that  require union-represented workers to become union members (and pay union dues)? Will the decision encourage or discourage states  to enact so-called “right to work” laws which prohibit union membership clauses?

It is unlikely we have heard the last word on these and other issues springing from the landmark Janus decision.