The Illinois FOP Labor Council

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By Jeff Burke, Attorney - Monday, August 4, 2014

 

The United States Supreme Court issued its latest round of decisions at the end of June.  Among them is a civil case arising in Illinois, in which Governor Quinn was a defendant.  The case involved the legality of forcing “personal assistants” employed jointly by the State of Illinois and the individuals who they work for to pay union dues.  On the unique facts of the case, the Court held that the collective bargaining agreement between the State of Illinois and the Service Employees International Union Healthcare—Illinois & Indiana (“SEIU-HII”) requiring employees in the bargaining unit to pay union dues was unconstitutional.  This case had been watched closely by unions across the country.  However, as a practical matter, it will likely have little impact, if any at all, on the dues check-off provisions in most collective bargaining agreements,  including those of the FOP Labor Council.

The case arose when a group of “personal assistants” employed under the Illinois Home Services Program, who constitute a bargaining unit represented by SEIU-HII, filed a lawsuit against the State of Illinois and the union alleging that their contract’s mandatory dues requirement violated their rights to free speech guaranteed by the First Amendment of the United States Constitution. 

The Illinois Home Services Program allows Medicaid recipients, called “customers”, who would otherwise be hospitalized, to hire a “personal assistant” to provide home healthcare services.  By statute, the customers control most aspects of the employment relationship with the personal assistants, including hiring, firing, training, disciplining, supervising, and defining their duties.  The State pays the personal assistants’ salaries.  The federal Medicaid program fund then reimburses the State for the salaries.

An Illinois law defines the employer-employee relationship between the customers, personal assistants, and the State.  It provides that the customer “shall be the [personal assistant’s]  employer”, and that the State, “shall not have control or input in the employment relationship between the customer and the personal assistants.” Other provisions of the law emphasize the customer’s employer status.    The State has a comparatively small role in the personal assistant’s employment.  For example, it requires them to have a Social Security number, and basic communication skills.  It mandates that the customer and personal assistant have an employment agreement (many of the personal assistants are family members of the customer), and that the customer perform annual performance reviews of the personal assistant.  It only suggests particular duties—shopping, household tasks, etc.  Significant to the Court’s analysis, by statute, the customer has exclusive control over the terms and conditions of the personal assistant’s employment, but collective bargaining can only occur for conditions “that are within the State’s control.” In the majority’s words, “[t]hat is not very much.” Since the customer, not the State, supervises the personal assistants, matters such as discipline, breaks, hours of work, work schedule, vacations, job duties, and separation from employment are all outside the scope of the collective bargaining agreement.  The State also exempts the personal assistants from eligibility for health insurance, and relieves itself from legal liability for any tortuous acts the personal assistants commit. 

The SEIU-HII negotiates with the State for collective bargaining agreements covering the personal assistants.  The State’s duty to negotiate was pursuant to an executive order from Governor Blagojevich in 2003, as the Illinois State Labor Relations Board back in 1985 had declined to find that there was a true employment relationship with the State.  The Illinois Legislature later codified the executive order, with a statute that emphasizes that the personal assistants are not state employees for any purpose other than collective bargaining.

The Illinois Public Labor Relations Act (“PLRA”) allows unions to require bargaining unit members to pay “fair share” or “core” dues.  In Illinois, union contracts may require a “closed shop”—where all bargaining unit members pay dues. (This differentiates Illinois from the so-called “right to work” states, a misnomer, in which dues deduction is always voluntary).  However, the United States Supreme Court has previously held that the First Amendment’s Freedom of Speech clause guarantees that bargaining unit members do not have to support—i.e., pay for—the union’s first amendment activities, such as supporting political candidates or political issues.  A “fair share” or “core” member pays full dues, less the percentage that the union spent on non-chargeable “First Amendment” activity, which amounts to a very small portion of that.  “Fair share” or “core” members are not members of the union, and so cannot hold union offices or elect union officials.

Like most collective bargaining agreements, the contract between the State and SEIU-HII included a mandatory dues provision, and a mechanism for bargaining unit members to become “fair share” members.  The plaintiffs in Harris were a group of personal assistants who objected to paying dues at all, not just the fair share amount.  They filed a lawsuit in federal court alleging that paying even the core dues amount violated their rights to free speech.  The State and the SEIU-HII took the position that, under well-settled precedent, including Abood v. Detroit Board of Ed., 431 U.S. 209 (1977) (dealing specifically with public employees), and Communications Workers v. Beck, 487 U.S. 735 (1988), collecting core dues from the bargaining unit members was legal.

The Federal District Court judge agreed with the State and the union, as did the Seventh Circuit Court of Appeals, known to be generally unfriendly to unions, and concluded that it had “no difficulty” in deciding the matter.

The United States Supreme Court agreed to hear the appeal of the Seventh Circuit’s decision, and ultimately disagreed with the decision.  Though it reversed the Court of Appeals, its ruling is limited to the unique facts of this case.  Rather than issue a sweeping decision that would have fundamentally changed the legal landscape of union and fair share dues, it specifically declined to overrule Abood, though it spent a great deal of time criticizing it. 

The Supreme Court discussed why “closed shop” agreements do not violate the United State’s Constitution’s First Amendment: “The primary purpose of permitting unions to collect dues from non-members is to prevent non-members from free-riding on the union’s efforts, sharing the employment benefits obtained by the union’s collective bargaining without sharing the costs incurred.” The State also compels unions to promote and protect the interests of nonmembers, and fairly represent each member of the bargaining unit, whether paying full dues or not, and so it may require payment of at least a core dues amount.       

Nonetheless, it concluded that the justifications for a closed shop were in this case insufficient to overcome the plaintiff’s First Amendment rights.  It held that “the government may not prohibit the dissemination of ideas that it disfavors, nor compel the endorsement of ideas that it approves . . .” As a result, an agency fee provision, “cannot be tolerated unless it passes exacting First Amendment scrutiny.” In the Court’s opinion, it did not under these facts.

The unique nature of the employment arrangement between the State, the customer, and the service provider is what convinced the Court that the traditional arguments for allowing mandatory dues payments were not compelling enough to warrant the alleged First Amendment violation.  Though it did not expressly call the arrangement a “sham”, the Court was not persuaded by the statute declaring that the personal assistants were “State employees” essentially for collective bargaining purposes only.  It made a qualitative determination that since the union had relatively little to bargain over, the justifications for compelling monthly dues payments were not present, as they were in prior cases that the Court has decided.  The majority concluded that the State and the union were asking “to sanction what amounts to a very significant expansion of Abood—so that it applies, not just to full-fledged public employees, but also to others who are deemed to be public employees solely for the purpose of unionization and the collection of an agency fee.” Suggesting, in other words, that Blagojevich’s recognition of the SEIU-HII in 2003 and the subsequent codification of his executive order were primarily for the purposes of helping SEIU-HII collect dues.  The Court noted that the SEIU-HII had collected over three million dollars in dues from the bargaining unit.  It also quoted from an article titled, “The Trouble With Public Sector Unions”, published in 2010 by the Journal of National Affairs, for the proposition that, “[i]n Illinois, for example, public-sector unions have helped create a situation in which the state’s pension funds report a liability of more than $100 billion, at least 50% of it unfunded.”

Four of the justices dissented.  The dissent agreed with the Seventh Circuit Appeals Court that it was irrelevant whether the personal assistants were “full-fledged public employees.” It pointed out that the majority’s classifying the personal assistants as “partial” or “quasi” employees was a label of its own devising.  Labor law has long recognized the existence of the “joint employer”, where an employee has two or more employers simultaneously.  Employees of a county sheriff will be familiar with the joint employer arrangement.  Addressing the majority’s opinion that the union lacked the ability to do much for the bargaining unit members, the dissent first points out that the union obtained its role as the exclusive bargaining agent after being authorized by a majority vote of the bargaining unit members, most—if not all—of whom would have had to know that union representation would involve paying dues.  Regardless of the majority’s qualitative opinion, the bargaining unit members themselves wanted union representation and were prepared to pay for it.

On the union’s practical ability to protect the bargaining unit members’ interests, the dissent pointed out that the State has maintained its authority to withhold payments to any personal assistant “based on credible allegations of customer abuse, neglect, or financial exploitation.” In fact, the dissent noted, the union had recently grieved the State’s disqualification of a personal assistant—effectively firing her from her customer—and was successful in having her disqualification reversed at arbitration.  It pointed out that personal assistants’ pay was within the State’s discretion, not the customer’s.  Also, on health insurance, the dissent noted that “[c]ollective bargaining between the State and the SEIU has focused on benefits from the beginning, and has produced state-funded health insurance for personal assistants.” The State, an unlikely ally with the SEIU-HII in this matter, additionally argued to the Court that given the number of workplaces, their dispersion, and the lack of day-to-day supervision from anyone but the customers, it wanted the ability to address concerns common to the personal assistants with a single collective bargaining representative.

In other words, according to the dissent, the majority’s qualitative assessment of the union’s ability to earn its keep does not appear to be supported.  For these reasons, the dissent argued, Abood should have controlled the outcome and the case should have been dismissed.

The FOP Labor Council does not represent personal assistants, nor does it have any bargaining units with a similar employment arrangement that the majority found problematic in this case.  This decision should not create any impact on the dues check off provisions of the Union’s contracts.  Should any bargaining unit or local lodge leadership member experience a problem with their employer as a result of this decision, they should contact their Union Representative immediately. 

About the Author:  Jeffery Burke has been an attorney with the FOP Labor Council since 2004.  He received his Bachelor’s Degree from the University of Massachusetts in 1992 and his law degree from Chicago-Kent College of Law in 1996.  Jeff has a long history working within the organized labor movement, working with the Chicago labor firm of Katz, Friedman, Schur & Eagle from 1994 to 1996, representing the United Auto Workers Union, Service Employees International Union, and others. He worked in house for Local 714 of the International Brotherhood of Teamsters from 1996 to 1998, then Local 705 of the International Brotherhood of Teamsters from 1998 to 2004.