U.S. Supreme Court Update: “Fair-Share Fees”

September 1, 2019

For decades, unions and employers have negotiated agreements under which a “fair share” or “agency” fee is collected on behalf of the union from the wages of employees who are not union members, but nonetheless benefit from contract terms the union negotiates. Over forty years ago, the United States Supreme Court approved of such agreements, concluding that they reduced the risk of non-union members becoming “free riders.” Abood v. Detroit Board of Education, 431 U.S. 209 (1977). Such “fair share” fee agreements involving public employees can no longer be enforced unless a bargaining unit member consents to have that fee withheld from his or her wages.

Agency fees were intended to facilitate spreading the costs of union representation, generally for bargaining, grievance and related representation that benefits all members of the bargaining unit regardless of union membership.

On June 27, 2018, in Janus v. AFSCME, No. 16-1466, the Court declared that avoiding “free riders” is not a compelling interest, and cannot overcome objections grounded in the First Amendment, stating:

In simple terms, the First Amendment does not permit the government to compel a person to pay for another party’s speech just because the government thinks that the speech furthers the interests of the person who does not want to pay.

The Court concluded:

States and public-sector unions may no longer extract agency fees from nonconsenting employees….

This procedure violates the First Amendment and cannot continue.

And, more specifically, the Court said:

Neither an agency fee nor any other payment to the union may be deducted from a nonmember’s wages, nor may any other attempt be made to collect such a payment, unless the employee affirmatively consents to pay. By agreeing to pay, nonmembers are waiving their First Amendment rights, and such a waiver cannot be presumed. …. Unless employees clearly and affirmatively consent before any money is taken from them, this standard cannot be met.

The Impact:

Public employers who have been withholding fair share fees from non-union members’ wages must immediately cease that practice. The public employer cannot resume withholding fair share or agency fees from any non-union members unless and until the employee consents.

It should be incumbent on the union to obtain non-union members’ consent and provide the public employer with confirmation of consent.

To avoid claims of direct dealing, if an employee notifies a public employer that he or she consents to having a fair share fee withheld, the employee should be redirected to inform the union of that decision.

Public employers should consider promptly engaging with unions representing their employees’ collective bargaining units to engage in affects bargaining regarding the establishment of a procedure for the union to notify the employer if or when consent to withhold fair share fees from non-union unit members is obtained.

Lisa E. Pizza, Spengler Nathanson P.L.L., 419-252-6227, lpizza@snlaw.com


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