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June 02, 2023

In Win for Organized Labor, Michigan Governor Repeals Controversial Right-to-Work Law

Ahmad Chehab

According to the National Conference of State Legislatures, roughly 50% percent of states in the country have laws prohibiting unions from requiring workers to pay union dues or fees as a condition of employment. These laws essentially give workers the right to work in a unionized workplace without having to pay union dues or fees, even if the union represents the workers in collective bargaining negotiations. Proponents argue right-to-work laws attract new businesses and create new jobs. Meanwhile, critics claim that right-to-work laws weaken unions because of the so-called “free rider” problem: workers benefit from union representation without paying union dues or fees, which purportedly leads to lower wages and benefits. In the past decade, union membership in Michigan has fallen by 2.6% as union membership nationally has been tumbling for years, reaching an all-time low last year of 10.1%. Michigan became a right-to-work state in 2013, when the “Right to Work” policy, formally known as the Freedom to Work (“FTW”) law, became effective. FTW prohibited employers from requiring workers  to join a union or pay union dues or fees as a condition of employment.

On March 24, 2023, Michigan became the first state in decades to repeal its right-to-work law through the enactment of two significant pieces of legislation: Public Act (“PA”) 9 (2023), which applies to public employment, and its private sector equivalent, PA 8 (2023). Notably, both laws include financial appropriations to prevent a public referendum in which voters could have rejected the law. They are scheduled to take effect 90 days after the end of the current (102nd) legislative session. PA 8 amends Michigan’s Labor Mediation Act, which regulates private labor law on a state level. PA 8 removes previous statutory prohibition to employers from requiring an employee to become or remain a union member or pay dues, fees, or other charges to a union. PA 8 also deletes previous language declaring that it is in the best interest of the people of Michigan to protect the “right to work.” Provisions in collective bargaining agreements requiring employees pay for unions dues or a service fee in order to remain gainfully employed will once again be legal in private-sector collective bargaining agreements for the first time in over a decade.

PA 9 amends Michigan’s public sector labor statute, the Public Employment Relations Act (“PERA”), by authorizing public employers to make an “agreement with an exclusive bargaining representative to require as a condition of employment that all other employees in the bargaining unit pay to the exclusive bargaining representative a service fee equivalent to the amount of dues uniformly required of members of the exclusive bargaining representative.” However, unlike its private-sector counterpart, PA 9 is expressly limited by a trigger provision, which provides that it will only become effective upon the ratification of a constitutional amendment or “a decision or ruling by the United States Supreme Court that reverses or limits, in whole or in part, Janus v. AFSCME, 138 S. Ct. 2448 (2018).” Janus struck down a state law that authorized unions to assess nonunion public employees “agency fees” to cover their proportionate share of union dues attributable to union activities conducted on behalf of nonunion members as violating their First Amendment rights to free speech and free association. Accordingly, while Janus decision remains good law, and in the likely absence of a constitutional amendment, public-sector employers and unions will continue to be limited in their ability to mandate and collect payments of fees from non-members who benefit from their collective bargaining activities.

Michigan’s repeal of the right-to-work laws represents a major win for organized labor, but it remains to be seen what impact the repeal will have on the workforce in the Great Lakes state. 

Ahmad Chehab

Senior Attorney, Miller Canfield

Ahmad Chehab is a Senior Attorney with Miller Canfield in Detroit, Michigan, where he focuses his practice on labor and employment law, including advising and representing employers in collective bargaining and labor arbitrations

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