Supreme Court Holds that Public Sector Unions May Not Assess Union Fees Against Non-Union Employees

Co-Author Nick Vogt*

In Janus v. American Federation of State, County, and Municipal Employees, Council 31, the United States Supreme Court held that public sector unions may not assess union fees against non-union employees covered by a collective bargaining agreement. In so holding, the Supreme Court overturned its decades-old ruling in the case of Abood v. Detroit Board of Education, in which the Court held that public sector unions could assess fees regardless of membership status, because all employees benefit from union collective bargaining agreements regardless of union membership.

Prior Court Rulings

In recent years, the Abood decision has come under question. In the 2013 case of Harris v. Quinn, the Supreme Court ruled that in-home healthcare providers are not public sector employees and therefore not bound by Abood. Dicta from Justice Alito’s majority opinion in Harris indicated an openness to re-evaluating the Abood ruling.

Then in 2015, the Supreme Court, with an eight-justice bench, deadlocked along ideological lines on the same issue in Friedrichs v. California. Justice Neil Gorsuch, the newcomer to the Court, joined the majority opinion, which was authored by Justice Alito.

The Background of the Case

In Janus, Illinois Governor Bruce Rauner brought suit challenging a State law that allowed the assessment of public sector union fees against non-union members. Two public sector employees, Mark Janus and Brian Trygg, filed a motion to intervene, arguing that the assessment of union fees against their paychecks when they are not members of that union constituted a compelled speech violation of the First Amendment.  They asserted that they had refused to join the union because they opposed many of the public policies advocated by the union and the positions taken in collective bargaining. In particular, Janus maintained that the union’s “behavior in bargaining does not appreciate the current fiscal crises in Illinois and does not reflect his best interests or the interests of Illinois citizens.”  He contended that all non-member fees coerced him to participate in political speech with which he strongly disagreed, which was forbidden by the First Amendment.

The District Court for the Northern District of Illinois dismissed Governor Rauner’s claim on behalf of the State, but granted the public sector employees’ motion to intervene, before subsequently dismissing their claims as well.  The employees appealed this dismissal to the U.S. Court of Appeals for the Seventh Circuit. The Seventh Circuit rejected the free speech argument, citing Abood as legally controlling, and permitted the compelled deduction of fees from employees who are part of a public employee union-represented bargaining unit, even if they are not union members.  That ruling was appealed to the Supreme Court.

The Supreme Court’s Ruling

Justice Alito, writing for the majority (Chief Justice Roberts and Justices Kennedy, Thomas and Gorsuch), held that forcing objecting non-members to pay fees for collective bargaining and related activities impinges on their First Amendment rights by compelling them to subsidize speech on matters of public concern.  As such, it is unconstitutional.  In so holding, the Court overruled Abood, which had held that non-members could, consistent with the First Amendment, be charged with the portion of the union dues attributable to collective bargaining (so-called “chargeable” expenditures), but not amounts to fund the union’s “political or ideological projects” (“non-chargeable” expenditures).  The majority’s reasoning was based on the following.

The First Amendment includes not just the right to speak and to choose with whom to be associated, but also the freedom to refrain from speech and association.  “Compelling a person to subsidize the speech of other speakers raises similar First Amendment concerns.” (emphasis in the original).  Governmental restrictions on speech and compulsion of speech sometimes are allowed, but in such cases, they must be justified under established jurisprudential standards of scrutiny to survive a First Amendment challenge.  Although the level of scrutiny applicable to this case (strict or exacting) was debatable under Court precedent, the majority found that the compelled fees challenged by Janus were not justifiable under either standard.

The majority found that two main State interests advanced for the restriction under the Abood  — fostering “labor peace” and avoiding the “free rider” problem – were not advanced by compelling non-members to pay fees.

With respect to labor peace, the Court in Abood had forecast that if non-members were exempted from fees, this somehow would lead to multiple unions seeking to represent employees, which would result in inter-union rivalries, conflicting demands from different unions, and dissention within the workforce.  Experience over time, said the majority, has proven otherwise.  In the Federal sector and in 28 States where non-members are not compelled to pay any fees to unions, public employee union membership is strong and cohesive. “[I]t is now undeniable that ‘labor peace’ can readily be achieved ‘through means significantly less restrictive of associational freedoms’ than the assessment of agency fees.” (citations omitted).

Addressing the “free rider” problem, the majority noted that Janus objected to this label, asserting, “he is not a free rider on a bus headed for a destination that he wishes to reach but is more like a person shanghaied for an unwanted voyage.”  Nevertheless, the majority found free rider concerns are insufficient to overcome a First Amendment right. “In simple terms, the First Amendment does not permit the government to compel a person to pay for another’s speech just because the government thinks that the speech furthers the interests of the person who does not want to pay for it.” The majority observed that if this were the real concern, a solution that would be less burdensome and not impinge First Amendment rights would be to charge non-members for specific services (like grievance representation).  However, the solution offered by Abood (distinguishing between chargeable and non-chargeable expenses) is too vague to be workable and mounting a challenge to how the union has designated an expense too burdensome to survive First Amendment scrutiny.

The dissenting Justices objected that the majority ignored the fact that the line drawn by Abood¸ under which employees could not be compelled to pay the portion of the fees associated with the union’s political or ideological activities, preserved the First Amendment rights of objectors.  The balance struck between the interest of the State in stable labor relations and State employees in not subsidizing causes with which they disagreed was, according to the dissent, consistent First Amendment jurisprudence.

Impact of the Ruling 

Although this case addresses public employee unions, it may portend a future challenge to mandatory fees paid by non-members in the private sector.  Under the National Labor Relations Act, “union shops” – workplaces where membership in a union and payment of certain fees to a union is a condition of employment – are permissible in the private sector if permitted by State law. In Communications Workers of Am. v. Beck (1988), the Supreme Court construed the NLRA as permitting “the exaction of only those fees and dues necessary to performing the duties of an exclusive representative of the employees in dealing with the employer on labor-management issues.”  The Court did not decide whether this violated the First Amendment because their conclusion rested solely on the statute.  In a footnote in Janus, the majority noted that the Beck Court had “reserved” on whether union fees could be challenged under the First Amendment as a product of governmental action.  A future case may require the Court to decide the issue.

 

* Nick Vogt is a summer associate at Shawe Rosenthal and will graduate from the University of Maryland School of  Law in 2019.