Wednesday, June 27, 2018

Court Rules Against Unions in Janus

The Supreme Court has just released its decision in Janus v. AFSCME. I’m not typically the best predictor of what the Court will do, but even I had this one called from the moment Justice Gorsuch was confirmed. The Court, in a 5-4 decision by Justice Alito, overruled its own Abood decision to hold that public-sector union fees are unconstitutional. I won’t repeat how we got to this point (although you can start at my earlier post on the Janus oral argument, which has links on the aborted Friedrichs case, as well as our coverage of 2014’s Harris v. Quinn, in which Alito made clear where he wanted to go on this issue), but the upshot is that public-sector unions nationwide must now operate on an opt-in basis for all union contributions—even contributions that go to core collective-representation services. In other words, the free rider issue that exists for the private sector in right-to-work states now exists for all public-sector workplaces.

The basis for the decision is that dissenting employees’ have a 1stAmendment right not to pay any funds to the union representing them—even for collective bargaining and other work that goes to the benefit of all unit employees. This follows the dicta in Harris, but is a clear departure from the Court’s public-sector employment jurisprudence, which does not look favorably on individual employees' 1st Amendment claims. In particular, if this case didn’t involve unions, you would expect the Court to hold that concerns about dues paid to a third party are not matters of public concern. This result, to my mind, is the culmination of several related factors:  in addition to the strong pro-business bent of this Court, we’ve seen public-sector unions becoming more powerful than their private-sector counterparts, while also becoming strongly aligned with one political party. This has occurred during a period of time in which political antagonism is on the rise and we’ve more jurists appear willing to join that battle. As a result, unions as a whole, but public-sector ones in particular, have been targeted both politically and legally. And they just took a massive loss at the Court today.

Janus, of course, is not the end (although some unions may feel like it right now). Here are some questions I have after the decision—please add more (or responses) in the comments:

  • Will courts try to apply Janus to the private sector? There has been some loose language by the Court in the past that raises the possibility that court enforcement of union fee agreements is enough for state action, particularly in more highly regulated areas. The Court since then has been moving towards a more narrow interpretation of state action, but as Janus shows, that doesn't mean they won't make an exception when unions are involved. Indeed, in Janus, the Court stated that the line between chargeable and uncharitable expenses is "unworkable" (it's certainly difficult at times, but this seems a stretch). On the other hand, in its defense of overruling Abood, the Court in Janus stressed the difference between public- and private-sector collective bargaining and footnote 24 the Court described this state action argument as "more questionable" now then when Abood was decided. This could be considered a minor win for unions. See Joe Slater’s helpful article on this topic in which he argues persuasively that this holding should not apply to the private sector.
  • Is this the beginning of the end for exclusivity? Up to now, American labor law has been built on the notion that unions act as the exclusive representative of all employees in a unit. I predict (see warning above) that Janus will usher in more challenges to exclusivity. This may include unions being more willing to explore members-only representation, as well as the NLRB at some point addressing whether the NLRA requires employers to bargain with minority unions. For instance, a bill has already been introduced in NY that would allow unions to decline to represent non-member employees for grievances and other matters, while also allowing them to provide insurance and other benefits only to members; other states (California and NJ) have recently enacted and/or are working on other pro-union measures. One limit to this, however, is that in Janus, the Court seemed to double-down on the notion that unions and public-sector employers cannot agreed to contracts that treat nonmember employees worse. That doesn't preclude members-only unionism, but it does serve as a reminder that there would be limitations to such representation.
  • Related to the exclusivity issue--is this also the end of fair representation? Even before the Janus decision was announced, unions filed suit in state courts challenging the idea that they have a duty to fairly represent all unit employees. Now that Court has held that the Constitution precludes dissenting employees from paying for union representation, unions will argue in turn that it is unconstitutional to force them to expend time and resources representing employees who pay nothing. Janus gives some mixed signals. In one direction, the Court stated that unions' "duty of fair representation is a necessary concomitant of the authority that a union seeks when it chooses to be the exclusive representative." Thus, unions may have to seek to be members-only to push this argument. In the other direction, the Court seems to approve of arrangements in which union charge nonmembers for using grievance or arbitration procedures. 
  • While exclusivity and fair representation are weakened, will Janus usher in a strengthening of public-sector employees’ 1st Amendment rights? The language in Janus suggests so, as it now states that public-sector working conditions are matters of public interest that warrant more 1st Amendment protections. Despite that, however, the answer I think is “no.” Although it’s not defensible, I believe the Court will limit its broad 1st Amendment interpretation to cases brought against unions. Individual employees, I predict, will continue to face steep challenges raises these claims. Indeed, in Janus, the Court made a point of stressing that union speech is a public concern and it distinguished Pickering by stressing the difference between a union pushing for a wage increase and an individual employee--all of which seems to be a to distinguish individual employees' free speech claims. In addition, I doubt the Court will be as concerned with the 1stAmendment when unions challenge Section 8(b) limitations on their right to protest, picket, and boycott. See Charlotte Garden’s article on this.
  • How badly will this hurt unions? We saw fairly steep declines in union membership following major changes in states like Wisconsin. Will Janus and its new opt-in requirement extend that affect nationwide? I suspect that, on average, public-sector unions will see a big hit, but that the effect will not be consistent everywhere. This is especially true given that some states have already made moves to add protections for public-sector collective bargaining in anticipation of Janus.
  • On a minor note, while discussing the difficulty in challenging what's chargeable and what's not under Abood, the Court in Janus stressed the "substantial" costs in bringing an arbitration case to make such a challenge. It wasn't central to either case, but that's one of the exact arguments in Epic Systems (and the earlier Italian Colors) that the Court didn't seem concerned about.
  • On a non-labor related note, the number of precedents overruled by the Court in the last couple of weeks is remarkable--and that's just the ones overruled explicitly. For whatever reasons, the Court this term has seemed more willing to break from its past to achieve the result it wants, and it will be interesting to see if that trend continues next term.

-Jeff Hirsch

http://lawprofessors.typepad.com/laborprof_blog/2018/06/court-rules-against-unions-in-janus.html

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Comments

Following up on Jeff's comments about exclusivity, I believe that this decision is going to result in private attorneys representing non-union unit members in proceedings which use to be the exclusive domain of union attorneys. I discuss this a bit on my blog. The court stated at page 17:
"In any event, whatever unwanted burden is imposed by the representation of nonmembers in disciplinary matters can be eliminated through means significantly less restrictive of associational freedoms than the imposition of agency fees. Individual nonmembers could be required to pay for that service or could be denied union representation altogether. Thus, agency fees cannot be sustained on the ground that unions would otherwise be unwilling to represent nonmembers." (emphasis added)(citations omitted).

Posted by: Mitchell H Rubinstein | Jun 28, 2018 9:11:02 AM

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