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Last June, the U.S. Supreme Court ruled – in Janus v. AFSCME – that forcing public employees to pay union fees (also known as agency fees) violates their constitutional rights. We wrote about it at the time on our The Law @ Work blog. The Janus ruling reversed a decades-old practice of requiring union-represented public employees to pay an agency fee even if they had chosen not to join the union.
Our labor laws give union-represented workers in the public and private sector the right not to join and pay dues to a union. A minority of workers exercise that right for a variety of reasons – financial, philosophical, and religious. Agency fees are meant to ensure that there is no free ride for those workers who exercise that right. Agency fees are no trifling amount; they usually range from 75 to 85 percent of full union dues.
Unions represent far more workers in the private than the public sector. And the Janus decision does not outlaw forced agency fees for union-represented private sector workers. Yet, the Janus ruling is a blow to unions that represent public workers because it means that those unions could lose millions of dollars in revenue.
So what’s been the actual impact of Janus so far?
Not surprisingly, many agency fee payers haven’t (out of the goodness of their hearts) simply chosen to continue making the previously forced payments. In fact, the early signs are that big numbers of agency fee payers are stopping payment. According to a Bloomberg Law report, two unions that represent a substantial number of public employees, AFSME and SEIU, have disclosed that a combined 210,000 agency fee payers stopped making payments following Janus. This means AFSME and SEIU have lost millions of dollars in revenue. While the sheer size of the exodus is eye-opening, the exodus itself should be no surprise. After all, agency fee payers already chose not to join the union that represents them. With Janus, the Supreme Court gave public employees a way out, and they appear to be taking it.
As other unions disclose their agency fee payer numbers, the impact of Janus will become clearer. Expect that impact to be uneven because some unions like AFSCME represent many public employees while other unions like the Teamsters are more heavily invested in private sector representation. Also, some unions will be better at making the case on the value of membership to keep those fees coming in. While still others will step up efforts to organize new members to offset the losses triggered by lost agency fee payers.
The fallout for unions from Janus will likely continue for some time as courts address a spate of lawsuits over agency fee refunds, what role unions can play in representing nonmembers, and what limits unions can place of when former members can stop paying dues. Perhaps, the most important impact to watch for is the extent full-dues paying members drop membership to avoid paying dues.
In a related development, Massachusetts’ top court, the Supreme Judicial Court (“SJC”), decided in Branch v. Commonwealth Employment Relations Board that Janus does not require public employee unions in Massachusetts to allow nonmembers to play an active role in contract negotiations or internal union affairs. The nonmembers who brought the suit argued that union rules that deprived them of a say in bargaining representatives, bargaining proposals or strategy robbed them of a “voice and a vote in their workplace conditions.”
The SJC ruled that even without a say in bargaining, nonmembers remain protected by the duty of fair representation, which ensures that unions cannot bargain a contract that discriminates against nonmembers in pay, benefits, or workplace conditions. The SJC found that was enough and that there was nothing in Janus that required more rights for nonmembers than that. So here in Massachusetts, the question of what role non-members can play in contract negotiations has been answered, for now.
We will keep you posted because the impact of Janus will affect unions’ ability to organize workers and influence public policy.