ContractsProf Blog

Editor: Jeremy Telman
Oklahoma City University
School of Law

Monday, January 23, 2023

The Roberts Court Can Hit Two Birds (Unions and Agencies) in One Blow

SCOTUS 2022The Roberts Court, led by Justice Alito, has pursued an aggressive anti-union agenda.  For example, in Janus v. American Federation (2018), in a 5-4 decision, the Court found that a 41-year-old precedent (Abood) which permitted public-sector unions to collect dues for the purposes of collective bargaining, contract administration, and grievances, violated the free-expression rights of workers who preferred not to be represented by the union.  This creates a huge free-rider problem for the unions and restricts their ability to collect the dues they need, for example, to create reserves that they need to provide benefits to workers in case of a strike.  That is awesome for industrial business entities.  Three years later, in Cedar Point Nursery v. Hassid (2021), in a 6-3 decision, the Court ruled that a 44-year old California regulation that allowed labor union representatives to enter private farms for the purpose of union organizing effected an unconstitutional taking.  Absent this regulation, there is simply no convenient mechanism that allows unions to recruit farm workers.  That is awesome for agricultural business entities.  This term, the Court will decide another union case, and the prospects for the unions are not good.  

In his 2021 article, How the Roberts Court Has Changed Labor and Employment Law, Scott Budow looked at the two cases discussed above and thirteen others.  Here is what he found: 

Supreme Court justices collectively cast 134 votes in the 15 cases discussed in this article. Those cases spanned civil procedure, constitutional law, and statutory interpretation. There is no unifying judicial philosophy—such as originalism or textualism—that neatly explains why conservative justices would reliably vote in one manner and liberal justices in the opposite manner for these cases. Yet, if all one knew was that conservative justices favor employers and liberal justices favor workers, that person would have correctly predicted 132 of the 134 votes cast (98.5%).

The new case is Glacier Northwest v. International Brotherhood of Teamsters.  The facts are as follows:  workers struck at a factory in Washington State.  The company alleged that the workers caused intentional harm by leaving cement to harden in mixers.  The trial court dismissed the suit, pending a determination by the National Labor Relation Board (NLRB) on whether the union's conduct was protected under the National Labor Relations Act (NLRA).  

One issue in the case is the extent to which state tort actions are pre-empted under federal law in this area.  According to writing on ScotusBlog, this area of law is governed by something called Garmon pre-emption.  Justice Gorsuch wanted to know the size of the "penumbra" around such pre-emption. I don't think this court is particularly find of penumbras, regardless of their size.

Strict ScrutinyAll of the Justices were engaged in the second issue, which involved a discussion of whether there is some way to reasonably cabin the limitations on the unions' potential liability for damage to company property.  Common sense would seem to dictate that unions should not be liable for incidental harms that occur during a strike but that they ought to be liable for intentional harm to company property.  However, as the good people at the Strict Scrutiny podcast point out, the whole point of a strike is to do intentional harm to the corporation.  Justice Kagan explained this during oral argument:

What I hear you saying is that the focus on intent is wrong because workers unions do things all the time intentionally to maximize economic harm. You know that if there is a seasonal component of a business, workers will try to time their strike in order to maximize the economic harm because, you know, more of the business is conducted in the summer than in the winter and things like that, that there are all kinds of things which are perfectly intentional to maximize economic harm. And so you’re saying that when we start focusing on intent without more it it it pulls in pretty much, you know, every strategic decision that a union makes as to when to conduct a work stoppage.

Workers might, as they did in Washington, walk out without first emptying the cement mixers because when you go on strike, you stop working, and emptying the cement mixers is, . . . well, . . .  you know,  . . . work.  But none of those actions by the unions would effect any harm to the company if the company would strike a deal with the workers so that they could return to work.  And so pinning all of the liability for the effects of a strike on the workers tilts the balance of justice in favor of employers.

Unions engage in asymmetrical warfare.  Corporations are extremely powerful.  Anybody who has ever been confronted with a business entity's contract of adhesion (that is, everybody) knows that, faced with that power, individual workers do not have the means protect their interests.  Only if they have a union can they negotiate with their employers from something like a position of equal bargaining power.  But still, the workers have limited tools, the most powerful of which is the strike, and the very purpose of the strike is to effect or threaten to effect economic harm in order to get the company to agree to terms.  If the Court adopts a rule that will make the unions pay for that harm, the unions' most effective tool is blunted into uselessness. 

The final issue was whether the legal issues in the case ought to be decided in the first instance by state courts of by a the NLRB.  As the Strict Scrutiny crew was quick to point out, being able to limit the power of both unions and executive agencies in one case while also taking a swipe at federal pre-emption is a doctrinal turducken of a feast for the YOLO court.  Noel Francisco tried to argue that whether these cases start in the state courts or in the agency, it's six of one, half a dozen of the other in terms of their ability to reach the right conclusion, but he made very clear  the corporation's antipathy for legal proceedings in the agencies.  As Mr. Francisco put it, "We’d prefer not to be before an administrative agency where the agency is the judge, jury, and executioner.  We prefer to be in a court system where we have a neutral judge and the potential for a jury.” 

The counterargument is that the NLRB, with specialized expertise and the experience of doing nothing but addressing labor disputes and interpreting the NLRA, is far more likely to reach the correct conclusion than is a state court of general jurisdiction that hears a labor dispute only every once in a while and is not immersed in the relevant sources of law.  Moreover, as Justice Jackson pointed out, Congress seems to have wanted the NLRB to have the primary role here.  And yet, the Biden administration also argued that the case should be sent back down to the state court.

Sharon Block reports that the conservative Justices were relatively quiet during oral argument.  Nonetheless, if form holds, we can predict with 98.5% certainty that the union will lose 6-3.

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