EDITOR’S NOTE: The latest salvo in the right-wing assault on labor comes in the form of a case that many analysts see as an existential threat to public sector unions such as the PSC. Not surprisingly, the forces behind the case Friedrichs v. California Teachers Association include Charles and David Koch, the billionaire brothers who have wreaked havoc in Wisconsin and throughout the country by funding a network of “dark money” organizations – non-profits that are not compelled to reveal their donors’ names – that is dedicated to the destruction of the labor movement. The Friedrichs case is brought by the Center for Individual Rights, which has received funding through Koch-linked foundations, including the Claude R. Lambe Charitable Foundation, Donors Trust and Donors Capital Fund.
Here we present the first in an ongoing series of articles exploring the Friedrichs case, the powers behind it, and the potential ramifications of the upcoming decision, which is expected in June.
In an expected but potentially devastating blow to public sector unions, the Supreme Court announced in June that it will hear a case called Friedrichs v. California Teachers Association in its next term. Friedrichs, as Justice Elena Kagan explained in a similar case last year, asks the justices to “impos[e] a right-to-work regime for all government employees” throughout the country, and it does so based on an aggressive reading of the First Amendment that could have absurd consequences for the government’s relationship with its own employees. Should this case prevail, moreover, that decision could be an existential threat to many public sector unions, potentially draining them of the money they need to operate.
The primary issue at stake in Friedrichs is “fair share service fees,” also known as “agency fees” – fees that unions charge to non-members in order to cover the costs of the bargaining on those non-members’ behalf, as well as the provision of other services, such as the arbitration of grievances. Under well-established law, public sector unions are required to bargain on behalf of every worker in a unionized shop, regardless of whether a specific worker elects to join the union. This means that union members and non-members share alike in the benefits of working for a unionized employer.
And wages are only one aspect of the benefits workers receive through union representation. Unions may negotiate with management for the conditions in which workers perform their work, for the size of the workload and for benefits other than wages, such as health care, paid leave and retirement plans. When individual workers are treated unfairly by their employer, they can often pursue a grievance process with union representation that protects her from losing her job for lodging a complaint.
If workers were allowed to accept these improved working conditions or higher wages without having to pay anything in return, however, that would create a free-rider problem – where workers would have no incentive to join the union because they benefit regardless of whether they are members. Eventually, the union would be starved for funds, and all workers would lose the collective benefits they gain from being unionized.
To combat this problem, unions have historically charged agency fees to non-members in order to recoup the costs of bargaining or arbitrating differences with management on the behalf of non-members. These costs can be significant, as collective bargaining or the arbitration of grievances often require a sophisticated team of experts and lawyers who must be paid as professionals. Friedrichs, however, asks the Court to invalidate these agency fees – or, at least, to declare them optional – and permit non-members of a public sector union to gain many of the benefits of being in a union without having to pay for them. Should this case succeed, it would place enormous, potentially crippling, financial pressure on public sector unions.
The legal theory animating Friedrichs is rooted in the First Amendment’s prohibitions on compelled speech. In essence, the plaintiffs claim unions engage in a form of speech when they bargain on behalf of workers, and some of those workers may disagree with that speech. So requiring workers to fund collective bargaining amounts to a kind of compelled speech.
In Harris v. Quinn, the 2014 case that ultimately ended one union’s ability to demand agency fees for its representation of home health-care workers, Justice Kagan offered a hypothetical that suggested the plaintiffs’ free speech argument against unions could splash back on government employers, creating impediments to properly managing the workforce. Even Justice Antonin Scalia indicated in that same case that he found the First Amendment argument troubling.
The bad news for unions is that Scalia did not heed his own warning when he voted, along with the Court’s four other conservatives, to limit many unions’ ability to charge agency fees in the Harris case. Given that precedent, as well as a 2012 decision that also calls the viability of public sector agency fees into question, the future of agency fees looks grim.