Recent Supreme Court Decision Deals a Major Setback to Unions
UNIONS LOSE RIGHT TO COLLECT FEES FROM PUBLIC EMPLOYEES WHO DON'T JOIN
On June 27, 2018, the United States Supreme Court set a new precedent when it decided a case in favor of an Illinois state worker who was arguing against his public employer requiring him to pay agency fees to a union for bargaining, even though the he was not a union member. The Supreme Court overturned the previous standard set back in 1977, which allowed public employers to require their nonunion workers in union-represented bargaining units to pay agency or fair share fees to cover the cost of collective bargaining. The only caveat to this decades old standard was that the nonunion employees could not be forced to pay for a union's political or ideological activities. In its decision, the Supreme Court held that the old standard violated the First Amendment by forcing public-sector employees to pay the union fair share fees if they haven't given consent.
While the Supreme Court had shown signs in previous cases that a change to the standard could be forthcoming, it was unclear when that change would occur and what impact it would have. It is also unclear how public-sector unions will respond to such an unfavorable decision, as immediate financial effects and loss of members are likely. The Supreme Court noted these concerns, but stated that does not outweigh the considerable financial windfall unions have received over the past 41 years under the old standard.
IMPACT OF THE DECISION ON THE PRIVATE SECTOR
While this decision specifically references public sector employees and suggests its reach may end in the public sector realm, it is likely that attempts to apply it to the private sector will be made. Application of this decision may arise through a push for federal right-to-work legislation that could cover private-sector workers. Alternatively, private-sector unions may move toward the affirmative consent standard outlined by the Supreme Court for public-sector unions. The decision may also promote private-unions to find other outlets for compensation or get more creative with their finances as a precaution.
You can find the full decision here. If you have any questions regarding this decision or how it may impact your company, please contact your Thompson Coe attorney at (651) 389-5000 or send a message at myHRgenius@thompsoncoe.com. You can also find helpful information and resources regarding this topic and much more at https://thehrgenius.com/.
Thompson Coe’s Tips of the Week are not intended as a solicitation, do not constitute legal advice and do not establish an attorney-client relationship.