July 23, 2019 Feature

Janus One Year Later: Litigation Has Come

By Ronald J. Kramer

A year has passed since Janus v AFSCME, Council 31, 138 S.Ct. 2448 (2018), holding that forcing public sector employees to pay agency or fair share fees to unions violated the employees’ right to free speech and association under the First Amendment. It still is too early to predict the long-term impact of the decision, but Janus has spawned a lot of litigation. This article discusses four of the more significant ongoing public bargaining related Janus disputes.

1. The Battle for Refunds.

Currently there are several pending cases seeking refunds from unions that had required non-members to pay agency or fair share fees in the years prior to Janus. The headlines have been flashy, as some have been brought as class actions seeking hundreds of millions of dollars.

In reality, the claims have been falling on deaf ears. Courts recognize that private defendants may be held liable for damages under Section 1983 “only if they fail to act in good-faith in invoking the unconstitutional state procedure, that is, if they either knew or should have known that the statute upon which they relied was unconstitutional.” Wyatt v. Cole, 994 F.3d 113, 1118 (5th Cir. 1993).

Mark Janus himself learned that the hard way when the district court, on remand, found that he was not entitled to any damages. The court recognized that the earlier case of Abood v. Detroit Board of Ed., 431 U.S. 209 (1977), holding that employees could be required to pay fair share fees, was the law of the land. The Supreme Court had expressed misgivings about Abood, but not in a way to predict the outcome of Janus. The court noted in particular that had the general and/or presidential election resulted differently, the composition of the Supreme Court may well have been different, as well as the decision. Id. AFSCME acted in good faith, and Janus was not entitled to damages. Mr. Janus promptly filed an appeal to the Seventh Circuit.

2. The Battle Over Dues Check-Off and the Right to Revoke.

It is not at all uncommon for dues check-off cards and collective bargaining agreement provisions regarding dues check-off to provide for a limited window in which an employee can revoke dues authorization. Some state statutes also limit when an employee can revoke. This has led to litigation over whether these limits violate the First Amendment. Issues include: (i) the validity of fair share dues check-offs executed pre-Janus; (ii) the validity of membership dues check-offs executed pre-Janus; (iii) the validity of statutory revocation windows; (iv) the validity of revocation windows in collective bargaining agreements; and (v) the validity of revocation windows in the dues check-off cards.

One recent instructive decision is Belgau v. Inslee, 359 F. Supp. 3d 1000 (W.D. Wash. Feb. 15, 2019). The district court found that employees’ First Amendment rights were not violated by the terms of the union membership agreement they voluntarily signed, one that only permitted revocation during an annual ten-day window. The union continued to deduct dues after the employees had resigned. The employees could not state a claim under Section 1983 because they could not show that the complained-of conduct was committed by a person acting under color of state law, nor that the conduct deprived them of a right, privilege or immunity secured by the constitution or federal law. The union was a private entity that, on its own, drafted the membership agreements that the employees voluntarily signed. The union was not engaged in any state action. That the government was obligated to deduct fees in accordance with those valid agreements did not transform the agreement into state action. Id.

The Belgau court also dismissed the claims against the governmental defendants. The employees argued that a state law requiring that public employers honor dues check-off agreements, as well as the collective bargaining agreement under which the state agreed to withhold dues as the employee authorized, were unconstitutional. The court found that neither the statute nor the contract required involuntary dues deductions and thus did not violate the First Amendment. Id. Again, the state simply withheld dues pursuant to the employees’ voluntarily executed union membership agreement.

The court also rejected arguments that the agreement was somehow not a valid waiver of their First Amendment rights under Janus because the employees did not know of those rights when they executed it. The court found that Janus only applied to non-members, and cited favorably another court’s denial of a preliminary injunction seeking to stop continued deductions in accordance with a union membership deduction card. The cited opinion states that “the notion that the Plaintiffs may have made a different choice if they knew ‘the Supreme Court would later invalidate public employee agency fee agreements [in Janus] does not void’ their previous knowing agreements.” Id. (citing Cooley v. Cal. Statewide Law Enf’t Ass’n, 2019 WL 331170, at 2 (E.D. Cal. Jan. 25, 2019)); see also Smith v. Superior Court, 2018 WL 6072806 (N.D. Cal. Nov. 16, 2018) (denying motion for preliminary injunction in case where union member claimed he should have the right to revoke dues check off without regard to revocation window period).

If these opinions continue to trend, union members will be held to the dues check-off agreements they voluntarily signed. The more interesting cases will likely lie where state law provides for limited revocation windows, and where the parties by contract negotiated such windows.

3. Can Public Employees Be Forced to Be in a Bargaining Unit at All?

Janus focused on whether public employees could be forced to pay for representation, not whether the employees can be forced to have a third party represent them for free. Underpinning most public-sector bargaining laws is the concept that the union is the exclusive representative of all the employees in the bargaining unit—whether they are members or not—and has a duty to represent them in good faith. An employee who is not a union member and does not pay dues still enjoys the benefits of the collective bargaining agreement and can expect that the union will represent them in contract grievances.

Not all employees wish to be associated with unions, even if they do not have to pay. Prior to Janus, in Minnesota State Board for Community Colleges v. Knight, 465 U.S. 271, 288–290 (1984), the Supreme Court recognized the constitutionality of exclusive representation when it upheld a state restriction limiting participation in “meet and confer” sessions to the faculty’s exclusive bargaining representative. In Janus, Justice Alito made an aside that exclusive representation “substantially restricts the nonmembers rights” in a way that “would not be tolerated in other contexts.” Janus, 138 S.Ct. at 2469, 2478.

Cases challenging Knight have been percolating. In Bierman v. Dayton, 900 F.3d 570 (8th Cir. 2018), the Eighth Circuit rejected arguments challenging exclusive representation. Plaintiffs claimed the Minnesota law permitting union representation violated their constitutional right to freedom of association. The court found that the employees had not shown that the state’s recognition of the union infringed on the First Amendment rights of non-members to freedom of association in the form of a mandatory agency relationship, as they were not required to pay dues or union fees. The court followed Knight and found that Janus did not overrule that decision. Id.; see also Mentele v. Miller, 916 F.3d 783 (9th Cir. 2019) (designation of SEIU as the exclusive bargaining representative did not violate the First Amendment rights of the workers); Branch v. Commonwealth Emp’t Relations Bd., 481 Mass. 810 (April 9, 2019) (finding exclusive representation coupled with the duty of fair representation not to be violative); Uradnik v. Inter Faculty Organization, 2018 WL 4654751 (D. Minn. Sept. 7, 2018) (denying a motion for a preliminary injunction in case challenging constitutionality of being forced to be represented by a union).

The Supreme Court had the opportunity recently to take up the issue, but instead denied petitions for certiorari filed in Bierman (U.S. No. 18-766) and Uradnik (U.S. No. 18-719). Knight remains the law of the land.

4. Can Unions Be Forced to Represent Employees Who Do Not Pay? If So, Can Unions Deprive Them of a Say?

While many unions prefer to represent all employees in a bargaining unit, some have taken the position that they have a First Amendment right not to have to represent employees that do not pay their fair share.

Last February IUOE Local 150 filed suit against the state of Illinois alleging, among other claims, that the provisions of the Illinois Public Labor Relations Act that require Local 150 to represent non-members who refuse to compensate the union for its services violates its First Amendment rights. Sweeney v. Madigan, case no. 18-cv-01362 (N.D. Ill., filed Feb. 22, 2018). The state moved to dismiss the complaint. On February 6, 2019, the court denied the motion to dismiss. While the court did dismiss some related counts, the court recognized that Janus had placed the union in the position of being compelled by its legal duty of fair representation to speak on behalf of non-paying non-members, and that did raise an issue ripe for resolution. Sweeney v. Madigan, 359 F. Supp. 3d 585 (N.D. Ill. 2019).

The Massachusetts Supreme Court recently addressed the flip side of Sweeney: Whether non-union bargaining unit members should be able to have a voice and a vote in union negotiations. Branch v. Commonwealth Emp’t Relations Bd., 481 Mass. 810 (April 9, 2019). There, non-union member employees challenged not only the constitutionality of being forced to be represented by a union (which they lost given Knight, as addressed supra), but the constitutionality of the union, acting as their exclusive bargaining representative, thus depriving them of “‘a voice and a vote in their workplace conditions’ with respect to bargaining representatives, contract proposals, and bargaining strategy unless they [were to] join the unions and support their politics.” Id. It is quite common for unions to deprive non-members of the ability to vote for representatives, participate in preparing proposals, vote on the contract, etc.

The Branch court, however, could find no “State action” upon which a constitutional violation could be based. The court rejected the employees’ claims that somehow unions, by virtue of their being granted exclusive representation over employees pursuant to state law, were engaged in State action when adopting internal union rules restricting their participation. The court found that the link between exclusive representation and union membership requirements was too attenuated to constitute State action. Even assuming State action, the court saw no constitutional issues. Employees were provided the right to vote as to whether to have a union, and could vote the union out. The non-union employees’ exclusion from the process was the result of this election and their own choice not to join the union after they lost. The court, looking to Knight, noted the state had a legitimate interest in insuring public employers hear one voice presenting the majority view of its employees on labor issues. Last but not least, non-union employees were protected by the union’s duty of fair representation. Id.

Post-Janus litigation is not going away any time soon. Whether it is over one of the four issues addressed above, or on another issue, the Supreme Court may address Janus again. Until the dust settles on the open issues, public employers must tread very carefully to avoid becoming one of the increasing number of defendants in these cases.

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By Ronald J. Kramer

Ronald J. Kramer is a partner with Seyfarth Shaw LLP and the Chair of the Section.