The other shoe has finally dropped. The United States Supreme Court has delivered a decisive blow to the ability of public sector unions to collect agency fees. In Janus v. AFSCME, (June 27, 2018), the Court, in a 5-4 decision, concluded that requiring unionized public employees to at least pay agency fees if they decline to become members of the union “violates the free speech rights of non-members by compelling them to subsidize private speech on matters of public concern.”
The Court’s decision overruled its previous decision in Abood v. Detroit Bd. of Ed., 431 U.S. 209 (1977), which had authorized public sector unions to collect from non-members a portion of the dues that members pay. In New Jersey, that agency fee could be up to 85% of the membership dues. The rationale is simple and fair. Non-members enjoy the benefits of the union’s collective negotiations despite their non-member status, since they are still members of the bargaining unit. So long as the agency fees were limited to the cost of the union’s activities that benefited the non-members, and excluded money spent on “the expression of political views, on behalf of political candidates, or toward the advancement of other ideological causes not germane to [the union’s] duties as collective bargaining representative,” they were permissible. Janus overturns over 40 years of precedent and practice.
Instead of recognizing that agency fees prevent non-members from “free riding”, i.e., reaping the benefits of union membership without having to pay their fair share, the Court characterized agency fees as forcing public employees to “subsidize a union, even if they . . . strongly object to the positions the union takes in collective bargaining and related activities.” As a result, the Court’s decision allows non-member employees to take advantage of the union’s work in negotiating and enforcing the collective negotiations agreement, and allows them to enjoy the benefits achieved through bargaining without having to pay their fair share of the benefits. To collect an agency fee from nonmembers, the nonmembers will have to opt-in, i.e., provide affirmative consent, to pay such fees, although it is unlikely that a nonmember would affirmatively consent to pay agency fees.
The Court was not sympathetic to the harm this decision would cause to the public sector unions’ finances. Instead, the majority wrote, “[i]t is hard to estimate how many billions of dollars have been taken from non-members and transferred to public-sector unions in violation of the First Amendment . . . Those unconstitutional exactions cannot be allowed to continue indefinitely.”
The four dissenting Justices criticized the majority for “weaponizing” the First Amendment, noting that the First Amendment was not meant “to undermine but to protect democratic governance – including over the role of public-sector unions.” They did not mince any words: “There is no sugarcoating today’s opinion. The majority overthrows a decision entrenched in this Nation’s law – and in its economic life – for over 40 years.”
In short, Janus upends 40 years of history which allowed public employee unions to require non-members to pay agency fees. Because the decision is based on the U.S. Constitution, no new statute can change the conclusion, and New Jersey’s law which was passed in the wake of the Abood decision is now effectively invalidated. This litigation was a key part of the efforts of a number of anti-union organizations to eviscerate the strength of public sector unions and their members. Time will tell how much damage it will do here in New Jersey – but history in other states is not promising.
While Janus is undoubtedly a blow to public sector unions, we are hopeful that all public sectors unions will be able to meet the challenges presented by the decision. Public sector unions should consult with labor law attorneys to determine how Janus affects them. And the experienced labor attorneys at the Zazzali Firm stand ready to answer any questions you may have.