Public Worker Unions Brace for Fallout From Court Decision

Unions representing state and local government employees pledged Wednesday that they would not let their organizations be upended by a U.S. Supreme Court decision that is expected to deal them a financial hit by prohibiting the collection of fees from non-members.

“We’re not defeated," American Federation of State, County and Municipal Employees president Lee Saunders said during a conference call with reporters. "We are emboldened.”

While the ruling Wednesday in Janus v. American Federation of State, County, and Municipal Employees, Council 31 was not the one that union supporters were hoping for, it did not come as a surprise to most people tracking the case.

“I think that this case came out pretty much exactly as people had been expecting,” said Joseph Slater, a professor at the University of Toledo College of Law, who has taught and written about labor law.

The 5-4 ruling says state and local public workers who choose not to join a union in their workplace cannot be required to pay “agency” or “fair share” fees. These are meant to help cover the union's operational costs and are not supposed to go toward political advocacy.

For Mark Janus, the state child welfare specialist in Illinois who pursued the case, the fees were equal to about 78 percent of dues paid by union members and totaled $44.58 per month, according the court's majority opinion. Requiring workers to pay such fees, the Supreme Court said, amounts to an infringement on the First Amendment right to free speech.

"The First Amendment is violated when money is taken from nonconsenting employees for a public-sector union," Justice Samuel Alito wrote for the court’s majority.

The decision stands to affect unions representing thousands of state and local public workers across the United States, ranging from teachers, to corrections officers, to firefighters.

Justice Elena Kagan warned in a dissent that “the court today wreaks havoc on entrenched legislative and contractual arrangements” that some states have in place.

Leading up to the ruling, 22 states permitted agency or fair-share fees, and two allowed them under some circumstances.

“Every one of them will now need to come up with new ways—elaborated in new statutes—to structure relations between government employers and their workers,” Kagan wrote.

Lisa Soronen, executive director of the State and Local Legal Center, a group that provides assistance to states and local governments in connection with Supreme Court litigation, tentatively offered a less dire assessment of what the decision could mean for state laws.

“My guess,” she said, “Illinois collective bargaining law still stands, they’ll just rip out the agency fee section.” Soronen suggested the same would be true for other states laws and with labor contracts between unions and state and local governments.

Complications could emerge, she said, if agency fees are linked to other contract provisions. For example, if a contract says that, in exchange for agency fees, a union agrees not to strike.

“That’s a little messier,” Soronen explained.

Fitch Ratings characterized the ruling as not much of a game-changer for government budgeting.

"Despite the landmark Janus ruling, state and local governments will remain limited in their ability to control labor spending," Amy Laskey, a managing director with the credit rating agency, said in a statement. 

“States with right-to-work laws that limit collective bargaining powers can still confront labor-related spending pressures,” she added. 

The free speech concerns in Janus are rooted in the fact that employees had to financially support unions, even though they may disagree with their positions on collective bargaining or with other activities.

“Janus believes 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,'” Alito noted.

“Unions express views on a wide range of subjects—education, child welfare, healthcare, and minority rights, to name a few,” he added.

Chief Justice John Roberts joined Alito in the majority, along with justices Clarence Thomas, Neil Gorsuch and Anthony Kennedy, who said Wednesday that he is retiring from the court.

A lawyer for Janus praised the decision.

"The court did exactly what we wanted it to," said Jacob Huebert. "It was really the best result we could have hoped for.”

Joining Kagan in the dissent were justices Sonia Sotomayor, Stephen Breyer and Ruth Bader Ginsburg.

"There is no sugarcoating today’s opinion,” Kagan wrote. “The majority overthrows a decision entrenched in this Nation’s law—and in its economic life—for over 40 years."

"And it does so by weaponizing the First Amendment, in a way that unleashes judges, now and in the future, to intervene in economic and regulatory policy," she added.

Unions and progressive groups contend that Wednesday’s decision by the court punctuates a multi-year effort by conservative special interests to undermine organized labor through the courts. Eliminating agency fees is expected to crimp union finances.

"It's a corporate funded case,” said Alex Rowell, a policy analyst with the Democratic-aligned Center for American Progress. “They're attempting to weaken worker power, and understand that a lot of progressive policies get through with the help of unions."

But Huebert, Janus’s lawyer, rejected the idea that the court’s decision was a win for powerful interests at the expense of public employees.

"People lose sight of the fact that the plaintiff in this case is an individual worker who is looking to protect his own First Amendment rights," he said. "This is a victory for individuals."

Huebert is director of litigation at the Liberty Justice Center, which is affiliated with the Illinois Policy Institute, a group backed by wealthy conservative donors.

Mark Mix, president of the National Right to Work Legal Defense Foundation, called the court ruling a “massive step forward in the fight to protect American workers from forced unionism.”

“That fight is far from over,” he added.

It’s still speculative how the court decision will affect union finances.

“We are all assuming that there will be some drop, but not the kind of draconian, existential threat that the right wing attempted to do when they started this fight,” said Randi Weingarten, president of the American Federation of Teachers, which says it has 1.7 million members.

Lily Eskelsen García, president of the National Education Association, said that agency fee payers make up only about 3 percent of the union’s budget nationwide. “It’s a very small percentage,” she said.

But García said the groups that backed the Janus case have ambitions beyond just eliminating agency fee collections for unions. “They are going after our members,” she said. “They are going to have drop campaigns, they are going to say ‘look at what you get for free.’”

Proponents of agency and fair-share fees say that eliminating them creates the risk of a “free-rider” problem, where people opt out of paying into the union, but still benefit from its services. This, in turn, creates the possibility that unions could have their finances weakened.

But Heidi Shierholz, a senior economist and director of policy at the left-leaning Economic Policy Institute, said the concerns go beyond union finances. “Worker wages and benefits are what will be hurt if unions don’t have enough resources to do their work effectively,” she said.

Legal precedent allowing for agency fees was established in the 1977 Supreme Court case Abood v. Detroit Board of Education. Wednesday’s decision overturns that opinion.

“Developments since Abood, both factual and legal, have ‘eroded’ the decision’s ‘underpinnings’ and left it an outlier among the Court’s First Amendment cases,” Alito wrote.

“Employees must choose to support the union before anything is taken from them," he added.

“Accordingly, neither an agency fee nor any other form of payment to a public-sector union may be deducted from an employee, nor may any other attempt be made to collect such a payment, unless the employee affirmatively consents to pay.”

Professor Angela Cornell, founding director of the Labor Law Clinic at Cornell Law School called the Janus decision “disturbing in a number of different ways,” including in how it discards Supreme Court precedent established in Abood. “That was a unanimous decision that found that there was not a constitutional violation,” she said of the Abood case. “So it is a complete shift.”

“When you read the decision, you can see that it’s so ideological,” she added, referring to Wednesday’s ruling.

The Janus case has its origins in 2015, when Illinois Gov. Bruce Rauner, a Republican, issued an executive order instructing state agencies to end the enforcement of fair share fee contract provisions. Rauner also filed a lawsuit, charging that the fees were unconstitutional.

The governor called the Supreme Court ruling a "historic victory for freedom of speech and affiliation for our public sector employees, and for taxpayers who have to bear the high cost of government."

In Illinois alone, AFSCME represents about 65,000 public workers, including firefighters, crime scene investigators, clerical employees and child welfare specialists, like Janus. The union negotiates with the state over wages, but also issues like overtime and safety.

Janus intervened in Rauner's lawsuit along with two other state workers who weren’t union members. A federal judge ruled that the governor did not have standing to bring the court case. But Janus’s court challenge advanced until it ended successfully on Wednesday.

“The next step is to make sure that these 22 states that have had forced union fees actually respect this decision and respect workers’ rights,” Huebert said. “We want to make sure that if somebody doesn’t want to give money to a union, that they’re not forced to do so.”