Supreme Court Deals Blow to Unions in Collective Bargaining Fees Ruling

Author: David B. Weisenfeld, XpertHR Legal Editor

June 29, 2018

States and public-sector unions may no longer collect agency fees from non-union employees who object to paying them, the Supreme Court has ruled 5-4. While the holding in Janus v. American Federation of State, County and Municipal Employees was overshadowed by Justice Anthony Kennedy's retirement announcement, it is a significant development that overturns more than 40 years of settled labor law.

Writing for the Court, Justice Samuel Alito said individuals may not be coerced into betraying their convictions and that the compelled subsidization of private speech seriously impinges on First Amendment rights.

The case involved the claims of Illinois employee Mark Janus, who refused to join the union because he opposed many of the public policy positions it supports, including those taken in collective bargaining. Under the union's collective bargaining agreement, Janus was required to pay a monthly agency fee.

Since the Supreme Court's 1977 Abood ruling, unions have been allowed to collect dues from all employees that they represent so long as the dues are being used for collective bargaining, contract administration or grievance adjustment purposes, and not for political or lobbying activities.

But Justice Alito said Abood was inconsistent with free speech rights and wrote, "Employees must choose to support the union before anything is taken from them." He explained that no attempt may be made to collect such an agency fee payment unless the employee affirmatively consents to pay.

In dissent, Justice Elena Kagan said, "The majority undoes bargains reached all over the country" and that the opinion will wreak havoc on entrenched contractual arrangements. She had noted during the oral arguments in the case earlier this year that contracts covering up to 10 million workers could be invalidated.

Justice Alito countered, however, by pointing to the millions of public employees in 28 right-to-work states with laws that generally already prohibit agency fees in saying, "It is simply not true that unions will refuse to serve as the exclusive representative of all employees in a [bargaining] unit if they are not given agency fees."