New Battleground Emerges Over State, Local Government Union Fees

Public worker unions that represent state and local government employees are confronting new legal challenges after the U.S. Supreme Court ruled last month that fees they’d been collecting from non-members were unconstitutional.

Employees who did not join unions but had “agency” or “fair share” fees deducted from their pay have filed lawsuits in an effort to get that money back. States and local governments may be unable to avoid the legal fray. A lawsuit filed in Washington state last week names Gov. Jay Inslee and another state officials as defendants alongside a union.

In California, seven current or former teachers filed a lawsuit earlier this week in federal court seeking fee refunds. They are asking the court to certify the suit as a class action.

The class of people who could ultimately be covered by that case is not entirely clear yet. But one of the lawyers representing the teachers said he expects it to include other teachers in California who paid agency or fair share fees to unions during the last three years.

State and national union organizations are among those the lawsuit lists as defendants. They include the California Teachers Association, the American Federation of Teachers and the National Education Association, which says it has about 3 million members nationwide.

“Everybody knows from the time that they’re in kindergarten that, when somebody has something that doesn’t belong to them, they have to give it back,” John Bursch, one of the attorneys representing the teachers in the lawsuit, said by phone on Friday.

“We’re simply asking that the unions return the money which rightfully belongs to the teachers,” he added.

Bursch said he was unsure how much money could be at stake.

The U.S. Supreme Court ruled 5-4 on June 27 in Janus v. American Federation of State, County, and Municipal Employees, Council 31 that agency and fair share fees amount to a violation of the First Amendment right to free speech.

Employees must choose to support a union before anything is taken from them, and must affirmatively consent to paying any union fees, Justice Samuel Alito wrote for the majority.

At least four teachers pursuing the California suit were also plaintiffs in Friedrichs v. California Teachers Association, a Supreme Court case that mirrored Janus, but ended in a 4-4 split decision in March 2016, the month after Justice Antonin Scalia died.

Other lawsuits similar to the ones in California and Washington are brewing elsewhere, including in Connecticut, Maryland, Minnesota and Pennsylvania, according to Bursch.

On June 28, the U.S. Supreme Court instructed a federal appeals court to reconsider a case known as Riffey v. Rauner in light of the Janus ruling. That case involves a group of Illinois home health care assistants who are seeking about $32 million in fair share fee refunds.

The National Right to Work Legal Defense Foundation, which provided free legal aid to Mark Janus, the Illinois state child welfare specialist who brought the recently decided Supreme Court case, and Jonathan Mitchell, a former solicitor general for the state of Texas, are among those who are assisting plaintiffs in some of the lawsuits.

American Federation of Teachers president Randi Weingarten, said in an emailed statement that “right-wing forces” are aiming to “defund unions by starving them of the resources they need” and that, in the union’s view, Janus does not require past fee payments to be returned.

“The AFT and its affiliates are taking great care to comply with the Janus decision, regardless of how wrongheaded we think it is,” she added.

A spokesperson for the American Federation of State, County and Municipal Employees said by email Friday they were unable to immediately comment on the fee refund cases. The National Education Association did not respond to a message seeking comment.

Shannon Farmer, a labor and employment lawyer with the firm Ballard Spahr LLP, noted that the Janus decision leaves uncertainty about how it might be applied retroactively.

“There’s an interesting question about what the legal basis is to get this money back from the unions,” she said. “And the unions are going to say: ‘the Supreme Court case wasn’t retrospective and at the time we were taking this money out we were complying with state law.’”

Farmer said it is not inconceivable that state or local governments could end up on the hook for fee refunds depending on how the cases take shape, and how courts rule. A reason this possibility exists is that state and local employers were the ones that technically took fees from employees, before passing the money to unions.

“It’s harder to say that the union violated your constitutional right to free speech when the union didn’t directly take any money at all,” Farmer added. “The union was the ultimate recipient. But they’re not the ones who took it out of your paycheck. Your employer did that.”

State or local governments could always go to unions to collect any reimbursements courts order them to pay. And attempts to collect money from states could be complicated by the 11th Amendment, which poses obstacles to suing states in federal court for money.

Lawyers with the conservative think tank, the Freedom Foundation, filed a lawsuit last Tuesday in a U.S. District Court in Tacoma, Washington on behalf of workers who've cared for disabled or elderly people in the state’s Medicaid-funded home-care program.

The lawsuit was lodged against Inslee, who is a Democrat, and Cheryl Strange, the director of the Washington Department of Social and Health Services, naming them as defendants in their official capacities, along with the Service Employees International Union 775.

SEIU 775 has been certified by the state to represent the care providers in collective bargaining.

The plaintiffs in the case are not union members. And the lawsuit says labor agreements have compelled the state to deduct union fees from their wages without affirmative consent.

This suit, like the one in California, is also seeking class action status and says there are “likely thousands” of class members. The plaintiffs are seeking compensation for the fees they paid and for “mental anguish,” as well as punitive damages.

In the decades before last month's Supreme Court ruling, agency and fair share fees were paid by workers who did not join unions that represented others in their workplace.

The idea was that these employees, while not union members, still benefited from collective bargaining and other union administrative activities and should pay a portion of those costs.

Unions were barred from using the fees for overt political advocacy. But critics have argued that union positions in other contexts can be inherently political, like pushing for collective bargaining provisions that could raise costs for a states or local governments.

Leading up to the Supreme Court’s ruling in the Janus case, 22 states permitted the fees, and two allowed them under some circumstances.

Backers of agency and fair share fees say that without them there’s the risk of a “free-rider” problem arising, where people opt to not pay into a union, but still benefit from its services. This, in turn, creates the possibility that unions could have their finances eroded.