Public Sector Unions Take a Hit in Recent Supreme Court Decision

by LeClairRyan

The United States Supreme Court recently held in Harris v. Quinn that the First Amendment protects certain "quasi-public" employees from being forced to pay fees to a public sector labor union that they don't support. While the decision isn't fatal blow to public sector unions, it is certainly a setback -- and more legal challenges are in the wings.

The state of Illinois runs a program under which Medicaid recipients who would otherwise need to be in a healthcare facility can instead hire health care workers to help care for them at home. These workers, called "personal assistants" (PAs), are directly hired by the individuals who need care. Although the actual employment relationship is controlled by the Medicaid recipients, PAs are paid by the state, and are considered public employees under Illinois’ Public Labor Relations Act (PLRA), which governs collective bargaining agreements.

Illinois PAs are represented by a labor union that entered into a collective bargaining agreement with the state. The agreement contains a so-called "fair share" clause, under which PAs who choose not to join the union still have to pay union fees.

The constitutionality of "fair share" clauses is grounded in a Supreme Court decision dating back to 1977, Abood v. Detroit Board of Education, which held that state employees who opt not to join public sector unions can be compelled to pay fees to support union work related to collective bargaining. Today, fair share provisions are included in many public sector collective bargaining agreements. They exist primarily to eliminate the problem of free riders: employees who don’t pay union fees, but still reap the benefits of representation by a union that negotiates for better working conditions on behalf of all employees, regardless of union membership status.

In Illinois, the union fees collected by the PA's union are used for a variety of activities, including political activity. And therein lies the free speech rub: some PAs may choose not to join the union because the union supports politicians or causes with which the PAs disagree. If those PAs are forced to pay union fees, it unconstitutionally forces them to support speech that runs counter to their own beliefs. That, at least, was the argument made in Harris v. Quinn by a group of PAs who filed a class action lawsuit to prevent enforcement of the "fair share" fee provision against them. The argument was rejected by the two lower courts that heard the case, but when appealed to the Supreme Court, a five-Justice majority agreed with the PAs that the fair share clause was unconstitutional.

What the Supreme Court Said
The Supreme Court focused its constitutional analysis on the precedent established by Abood, under which non-union public employees can be forced to pay union fees without violating the First Amendment. Writing for the majority, Justice Alito expressed skepticism about the validity of the analysis underpinning Abood, and crafted a new standard that divides public employees into two categories: "full-fledged" public employees (to whom the Abood decision applies), and "partial public" or "quasi-public" employees (to whom Abood does not apply). Applying this new categorization to the Illinois PAs, the Court concluded that PAs are "quasi-public" employees because they are public employees solely for the purpose of collective bargaining; because the State doesn't control most aspects of the employment relationship between the individual home health care recipients and PAs; and because PAs aren't entitled to most of the benefits enjoyed by other "full-fledged" Illinois state employees.

The Court further held that the Illinois PLRA’s "fair share" fees provision violated the First Amendment because the public interests furthered by the provision were insufficient to overcome the PAs’ "right not to be forced to contribute to the union, with which they broadly disagree." Justice Alito noted that the Court's decision aligned with "the bedrock principle that, except perhaps in the rarest of circumstances, no person in this country may be compelled to subsidize speech by a third party that he or she does not wish to support."

Analysis and Takeaways
The Supreme Court's Harris v. Quinn opinion was released on the same day as the controversial Hobby Lobby decision on mandatory contraceptive coverage under the Affordable Care Act. From a media standpoint, Harris was largely overlooked amid the Hobby Lobby press deluge. But Harris may just turn out to be the sleeper case of this Supreme Court term.

For starters, the Harris decision represents an important loss for the union movement generally, and for public sector unions in particular. Public sector unions spend millions of dollars every year on political activity. Limiting the Abood fair share rule could weaken the financial power, and by extension the political influence, of public sector unions. In the longer run, especially if the rule is further limited in future court decisions, we could see a shift in the political balance of power.

Next, the constitutionality of fair share provisions in other public sector collective bargaining agreements is now in serious question. The Court's broad reasoning in Harris should prohibit the collection of fair share union fees from other "quasi-public" employees working in home health care as well as other fields where the employment relationship is largely controlled by private individuals. Indeed, lawsuits challenging fair share laws as applied to government-subsidized child care workers and public teachers are currently working their way through the courts.

As for "full-fledged" public employees, Abood remains good law, and fair share provisions in collective bargaining agreements are still constitutional as applied to them. That said, the Court took a very negative view of the 1977 case. It stopped short of overruling Abood entirely, but the majority called the decision an "anomaly" that had "questionable foundations." (The tenor of the Court's review suggests Abood may be short lived should another case reach its docket.)

Finally, some unions may try to rethink how they collect fees. The extent of the financial impact of Harris on public sector unions in Illinois and other states where home health care workers are represented by public sector unions -- such as California, Connecticut, Maryland, Massachusetts, Minnesota, Missouri, Oregon, Vermont, and Washington -- remains to be seen. But public sector unions raise a significant amount through member dues. In Illinois, for example, PAs pay their union more than $3.6 million in fees every year. It will be interesting to see if home health care and other public sector unions, can figure out a new model for collecting fees that addresses the free-rider problem without running afoul of the First Amendment.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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