June 29, 2018 U.S. Supreme Court Declares Mandatory Agency Fees to be Unconstitutional
KEEPING YOU INFORMED…
In one of its penultimate decisions for this term, the United States Supreme Court issued its opinion and decision in Janus v. AFSCME, Council 31. By a vote of 5-4, the Court declared that requiring public employees, without their consent, to pay agency fees (i.e., fees paid to a union by bargaining unit members who do not want to be part of the union) violates the First Amendment.
By way of background, agency shop fees were established for public sector employees who did not wish to participate in a union’s political activities. Union fees are broken down into non-chargeable expenditures (e.g., political and ideological projects) and chargeable expenditures (e.g., collective bargaining activities). As a result, agency fee payers may pay a lesser amount than union dues payers who wish to have their money subsidize those activities.
Until this week, New York State law required public employees to be either agency fee payers or union dues payers, regardless of whether they supported the union and its activities. As a result, many collective bargaining agreements also contain provisions regarding agency fee deductions.
In Janus, the Court held that it is unconstitutional to require a public employee, without the employee’s consent, to support a union by paying agency shop fees regardless of whether the employee shares the union’s views. In other words, a public employee’s agency fee money can no longer be used to “speak” for the union unless the employee affirmatively consents to pay it.
The Court stopped short of invalidating State laws (like the one in New York) requiring a union to serve as the exclusive bargaining agent for public employees. It noted, though, that these laws may impinge upon First Amendment Associational freedoms. This essentially “tees up” what we anticipate will be one of the next major public sector labor and employment law-related court challenges.
The Court also provided some guidance on what it deems to be the “consent” needed in order for a public employer to deduct agency fees from an employee’s paycheck. It held that, because these employees are “waiving their First Amendment rights,” the consent must be affirmative, freely given and shown by clear and compelling evidence before any money is deducted.
Implementing this decision will require you to immediately stop deducting agency fees unless the employee clearly and unequivocally provides affirmative consent authorizing the deduction. It is unlikely that your employees have already done so since New York law required the automatic deduction of agency fees from the affected employee’s paychecks.
There are other issues that you may need to address in the immediate future. One is whether your CBA(s) contain an agency fee provision and, if so, with which parts you must comply. Please contact us if you would like assistance with that analysis.
Another potential issue is a union demand to negotiate over the impact of the Janus decision. Again, we can assist you with responding to a demand for impact negotiations and next steps related to same.
Finally, please keep in mind that this decision only affects agency fee payments and not union dues or other related deductions. You should not change any of your current payroll practices regarding non-agency fee deductions.
Please check your e-mail for a more detailed memorandum from us addressing the legal and practical requirements and considerations with respect to implementing this decision.
If you would like to discuss in more detail compliance with Janus, please contact Richard Zuckerman, Sharon Berlin, Alyson Mathews or Alyssa Zuckerman at 631-694-2300.
THIS MEMORANDUM IS MEANT TO ASSIST IN GENERAL UNDERSTANDING OF THE CURRENT LAW. IT IS NOT TO BE REGARDED AS LEGAL ADVICE. THOSE WITH PARTICULAR QUESTIONS SHOULD SEEK THE ADVICE OF COUNSEL.
© Lamb & Barnosky, LLP 2018