Supreme Court Imposes New Political Dues Requirement on Unions
The U.S. Supreme Court has handed anti-labor forces a major victory that could not be achieved by a GOP-sponsored 2005 California ballot measure by requiring that all employees represented by a union be given the chance to opt-out of paying emergency fees to be used in union political campaigns.
The Court’s conservative majority said a special political dues assessment during the summer of 2005 by the Service Employee International Union of all the state employees it represented--both union and non-union members--was an “indefensible” violation of non-members First Amendment rights to not be forced into “compelled speech and compelled association.”
The net effect of the ruling will be to impose a new administrative procedure on unions in political fights that will take time and cost money, said Justice Stephen Breyer, in a dissent joined by Justice Elena Kagan.
Justices Sonia Sotomayor and Ruth Bader Ginsberg agreed with the decision, but said the court’s conservative majority raised First Amendment issues that were not in the initial lawsuit and accused their colleagues of judicial activism.
“I cannot agree with the majority’s decision to address unnecessarily significant constitutional issues well outside the scope of the questions presented and briefing,” they said. “By doing so, the majority breaks our own rules and, more importantly, disregards principles of judicial restraint.”
The class action case, Diane Knox v. SIEU Local 1000, in essence, enacts a long-sought Republican anti-union measure that was the focus of numerous political battles fought in state after state in the past two decades.
In California, Prop. 75, proposed by Republican Gov. Arnold Schwarzenegger, was defeated by 500,000 votes in a 2005 special election.
During that fight, the California branch of the SEIU imposed a series of dues increases on all the state employees it represents, including 28,000 employees who previously said they did not want to join the union and contribute to the union’s political activities. Those employees are required to pay the union an annual fee for representing then, but that fee is smaller than what members pay--which includes contributing to union political campaigns.
The state employees union said that Prop 75 and a second measure from Schwarzenegger, Prop 76, giving the governor power to revoke state wage and benefit contracts in fiscal emergencies, placed the union in “the fight for our lives.” Prop. 76 was also defeated at the polls—although the same policy has recently resurfaced in states such as Wisconsin under GOP governors.
After these measures were scheduled for a special election, the SIEU imposed a political dues surcharge on all the state employee it represented, union and non-union members.
“The SEIU joined a coalition of public-sector unions in vigorously opposing these measures,” the Court wrote, citing the history. “Calling itself the “Alliance for a Better California,” the group would eventually raise “more than $10 million, with almost all of it coming from public employee unions, including $2.75 million from state worker unions, $4.7 million from the California Teachers Association, and $700,000 from school workers unions.”
“On July 30,  shortly after the end of the 30-day objection period for the June Hudson notice, the SEIU proposed a temporary 25% increase in employee fees, which it billed as an “Emergency Temporary Assessment to Build a Political Fight-Back Fund,” it continued. “On August 31, the SEIU sent out a letter addressed to “Local 1000 Members and Fair Share Fee Payers,” announcing that, for a limited period, their fees would be raised to 1.25% of gross monthly salary and the $45-per-month cap on regular dues would not apply.”
“After receiving this letter, one of the plaintiffs in this case called the SEIU’s offices to complain that the union was levying the special assessment for political purposes without giving employees a fair opportunity to object. An SEIU area manager responded that, “even if [the employee] objected to the payment of the full agency fee, there was nothing he could do about the September increase for the Assessment… She also stated that ‘we are in the fight of our lives,’ that the Assessment was needed, and that there was nothing that could be done to stop the Union’s expenditure of that Assessment for political purposes…” As a consolation, however, those employees who had filed timely objections after the regular June Hudson notice [to opt out of the political portion of dues] were required to pay only 56.35% of the temporary increase.”
The federal District Court ruled that the SIEU had failed to ask its members if they wanted to opt out of the political surcharge. The Ninth Circuit Court of Appeals disagreed in a split decision. The U.S. Supreme Court overturned the Ninth Circuit ruling and imposed a new opt-out process.
Justice Samuel Alito, writing the majority opinion, said the case concerned the “whether the First Amendment allows a public-sector union to require objecting nonmembers to pay a special fee for the purpose of financing the union’s political and ideological activities.” He said that question raised First Amendment issues for the non-political dues-paying members. “Closely related to compelled speech and compelled association is compelled funding of the speech of other private speakers or groups.”
Alito said the blanket political dues surcharge went beyond “what the First Amendment can tolerate."
“The SEIU, however, asks us to go farther. It asks us to approve a procedure under which (a) a special assessment billed for use in electoral campaigns was assessed without providing a new opportunity for nonmembers to decide whether they wished to contribute to this effort and (b) nonmembers who previously opted out were nevertheless required to pay more than half of the special assessment even though the union had said that the purpose of the fund was to mount a political campaign and that it would not be used for ordinary union expenses. This aggressive use of power by the SEIU to collect fees from nonmembers is indefensible.”
Moreover, Alito said the SIEU’s actions were exactly what the California ballot measure sought to curtail.
“The effect on nonmembers was particularly striking with respect to the union’s campaign against Proposition 75 because that initiative would have bolstered nonmember rights. If Proposition 75 had passed, nonmembers would have been exempt from paying for the SEIU’s extensive political projects unless they affirmatively consented. Thus, the effect of the SEIU’s procedure was to force many nonmembers to subsidize a political effort designed to restrict their own rights.”
And Alito said that the dues could not be considered a loan to the union.
“Even a full refund would not undo the violation of First Amendment rights. As we have recognized, the First Amendment does not permit a union to extract a loan from unwilling nonmembers even if the money is later paid back in full.”
Justices Sotomayor and Ginsberg said that the Court’s conservatives unnecessarily raised First Amendment issues—disregarding “judicial restraint.” Justices Breyer and Kagan, dissenting, said the ruling's net effect would be to impose on unions waging political fights “a new opportunity [for members] to object [that] requires providing for explanations, potential challenges, the development of separate accounts, and additional administrative procedures. That means providing extra time and extra money.”
Breyer said unions could refund the emergency dues into the accounts of nonpolitical dues paying members the next time an annual dues assessment was collected—instead of in the middle of a political campaign. “There is always next year—when the chargeable amount of the fee will be based on this year’s actual expenditures. Given these considerations, I do not believe the First Amendment requires giving a second objection opportunity to those nonmembers who did not object the first time.”
“The Court mandates an “opt-in” system in respect to the payment of special assessments. Justice Sotomayor’s concurring opinion explains why the Court is wrong to impose this requirement,” he said. “It runs directly contrary to precedent. No party asked that we do so. The matter has not been fully argued in this Court or in the courts below. I agree with her about this matter.”
Breyer also said the political impact of the Court’s new requirement would be significant.
“An “opt-in” requirement can reduce union revenues significantly, a matter of considerable importance to the union, while the additional protection it provides primarily helps only those who are politically near neutral.”
The Supreme Court still has a half-dozen decisions to issue this term, including whether key elements of Obama’s health care reform law are constitutional, whether it will overturn a Montanan ban on corporate political spending and revisit aspects of its controversial Citizens United ruling, and whether a new Arizona law concerning search and seizure of suspected illegal immigrants is constitutional. Those decisions are expected in the next two weeks.