Supreme Court Deals Limited Blow to Public Unions

Author: Melissa Gonzalez Boyce, XpertHR Legal Editor

July 2, 2014

The Supreme Court in Harris v. Quinn struck down an Illinois law compelling home care personal assistants (PAs) working under the Illinois Rehabilitation Program to pay union dues despite being non-members but stopped short of stripping a state's ability to require non-union public sector workers to pay union dues. In a 5-4 decision, the Court narrowly ruled that the First Amendment prohibits the collection of "fair share" or agency fees from the PAs because they are "partial public employees" rather than "full-fledged public employees." In applying their rationale to the specific facts of this case and essentially creating a new category of public employees, the Court sidestepped overturning longstanding precedent that could have been ultimately devastating to public sector unions.

In Harris, a group of PAs providing health care services for individuals with disabilities under Illinois's Home Services Program challenged an Illinois law that classified them as state employees and required them to pay fees for the cost of certain collective bargaining activities under a provision in the collective bargaining agreement (CBA) with the Service Employees International Union (Union). The PAs argued that the state law that permitted non-union members to pay a portion or "fair share" of union dues (also known as agency fees) violated their First Amendment rights by compelling their speech and association through the union.

The district court and the 7th Circuit Court of Appeals rejected the PAs' claims based on the Supreme Court's longstanding determination in Abood v. Detroit Bd. of Ed., 431 US 209 (1977), which held that an agency-fee provision in a CBA was valid for public employees so long as the fees would be used for collective-bargaining, grievance-adjustment purposes, contract administration and other activities "germane to its duties as collective-bargaining representative." Therefore, the lower court held that the PAs, as employees of the state, may be required to pay such fees based on the agency-fee provision.

Writing for the Court, Justice Alito reversed the lower court's ruling and found that Abood did not apply here because the PAs did not qualify as "full-fledged public employees." Therefore the state may not mandate the PAs in this case to financially support the Union. As the Court stated:

In support of its opinion, the Court noted that, other than providing compensation to the PAs and setting basic qualifications for hiring, the State of Illinois plays a relatively small role in the PAs' employment. For example, the Court considered the following factors:

• The state establishes an employer-employee relationship between the person receiving care and the PA;
• State law explicitly declares that the person receiving the care is the "customer" and "shall be the employer of the [PA]";
• The customer has complete control over whom they hire as a PA;
• The customer supervises the PAs on a daily basis and the state is not given the right to enter a customer's home to check on a PA's performance;
• The state does not have the right to discharge a PA for substandard performance;
• The state does not provide PAs protection under the Illinois Whistleblower Act; and
• The state does not provide PAs the following benefits:
  • Group life insurance, retirement, health care benefits and other certain benefits; and
  • Paid vacation, holiday or sick leave.

Further, the Court acknowledged that, based on state law, Illinois does not assume any responsibility for actions taken by the PAs during the course of their employment, e.g., stealing, neglecting or abusing a customer.

Following the Court's determination that the PAs do not qualify as "full-fledged public employees" and therefore may not be compelled to pay agency fees, the Court turned to whether the payment of fees as required by state law is constitutional under the First Amendment. Specifically, the Court had to determine whether the agency-fee provision served a compelling state interest that cannot be achieved through means significantly less restrictive of associational freedoms. The Court rejected the State's claims that the agency-fee provision served to promote the "labor peace" because the PAs did not plan on forming a rival union nor challenging the authority of the Union. The Court also noted that the PAs did not work at a common facility where other potentially conflicting groups may be located. Finally, the Court found that the state failed to show the Union could not adequately advocate for the PAs without receipt of the non-member agency fees.

Despite its narrow ruling in this case, the Court nonetheless attacked the legal foundation permitting the collection of non-member union dues from public employees, which should be troubling news for public unions. Constituting almost half of the unionized workforce in the country, public unions came very close to losing their ability to compel fees from non-members - essentially allowing those non-members to become "free-riders" from the unions' perspective. Such a reality would deliver a devastating blow to the influence and landscape of public sector unions.