In Split Decision, Supreme Court Affirms 9th Circuit Judgment Finding Agency Fees Constitutional

On March 29, 2016, the Supreme Court issued a one-line decision in Friedrichs v. California Teachers Association announcing a 4-4 split in the case. The effect of the split is to affirm the 9th Circuit’s decision, which upheld the constitutionality of “agency fees,” or fees paid by non-union members in return for the benefits that the union has negotiated for the entire bargaining unit. To read the Supreme Court's Decision, click HERE.

The constitutionality of such fees, alternatively called “fair share fees” or “representation fees,” was upheld by the Supreme Court in the 1977 decision Abood v. Detroit Board of Education. The Abood Court held that it was not a violation of the First and Fourteenth Amendments for public-sector unions to collect agency fees from non-union members to help fund the union’s collective bargaining functions, which benefit the entire bargaining unit regardless of union membership status.

The Abood decision has remained good law since 1977. However, in a 5-4 opinion decided in 2014, Harris v. Quinn, the conservative members of the Court criticized the rationale underlying the Abood decision, signaling their receptiveness to reconsider the issue.

Shortly after Harris, the plaintiffs in Friedrichs, who are non-union member public school employees in California, brought suit challenging the constitutionality of agency fees. The plaintiffs, wishing to make their case on the appellate level, conceded before the District Court that their claims were foreclosed by Abood, and the court entered judgment for defendants. The 9th Circuit affirmed on the basis that Abood was controlling. The Supreme Court granted certiorari.

Then on February 13, 2016, news came of the sudden and unexpected passing of Justice Antonin Scalia. A politically conservative Justice, his passing changed the ideological balance of the Court. This left the fate of pending cases uncertain, and created potential for evenly split decisions, such as the recent decision in Friedrichs.

While an evenly split case has the effect of affirming the judgment below, the Court’s 4-4 decision does not have precedential value. Further, there is a possibility that the Court could order reargument on the case. Therefore, while upholding the constitutionality of agency fees, the Friedrichs decision remains vulnerable to future challenges and renders the appointment of the next Supreme Court Justice particularly relevant for public-sector unions.

It should also be noted that other cases that threaten collective bargaining rights remain in the pipeline. One such case, Serna v. Transport Workers Union of America, before the 5th Circuit, challenges the underpinnings of Abood and the right to collect agency fees under the Railway Labor Act.

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