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What Does the Janus Decision Mean to Alaska Municipalities and Public Employee Unions?

On Behalf of | Jun 27, 2018 | Firm News

Written by Will Earnhart

On June 27, the United States Supreme Court released its opinion in Janus v. American Federation of State, County, and Municipal Employees, Council 31,  No. 16-1466 (June 27, 2018), forbidding states from enforcing mandatory union membership of employees, expressly overturning its 1977 decision in Abood v. Detroit Board of Education. This was a 5-4 decision with the Court divided along the same ideological lines as its other recent landmark decisions.

Plaintiff Mark Janus is an Illinois state employee who believes his Union’s “behavior in bargaining does not appreciate the current fiscal crises in Illinois and does not reflect his best interests or the interests of Illinois citizens,” and would not subsidize the Union if given a choice.  Janus argued that support of collective bargaining itself violated his free speech rights. It should be noted, the lawsuit was originally filed by the Governor of Illinois and Janus was later substituted as plaintiff.

Under the prior precedent in Abood, although public employees could not be required to join a labor union, they could be required to pay an “agency fee” to the union for its services in being their collective bargaining representative.  The “agency fee” could not include any portion of the union dues to fund the union’s political or ideological projects, but requires payment for dues attributable to employee representation in collective bargaining, such as negotiations and grievance representation. (For Mark Janus, the agency fee amounted to $535 a year.) The Abood decision struck a balance between an employee’s First Amendment rights to free speech (including the right to not speak at all) and payment for services provided by the union.

The Court majority went to great lengths to argue that the reasoning in Abood was outdated, both in regard to free speech rights and in regard to maintaining “labor peace.” The Court ruled agency fees are unconstitutional “compelled speech.” The heart of the decision is the premise that labor negotiating itself is a form of speech and individuals cannot be compelled by government to support the wage and economic positions of the union.

What does this mean for Alaska municipalities with represented employees?

Alaska municipalities fall into two groupings in regard to labor relations law: those municipalities who validly opted out under section 4 of the Alaska Public Relations Act, ch. 113 SLA 1972 (PERA); and those regulated by PERA and the Alaska Labor Relations Board.  In adopting PERA, the Alaska legislature stated a strong policy in favor of collective bargaining: “The legislature declares that it is the public policy of the state to promote harmonious and cooperative relations between government and its employees and to protect the public by assuring effective and orderly operations of government. These policies are to be effectuated by (1) recognizing the right of public employees to organize for the purpose of collective bargaining; (2) requiring public employers to negotiate with and enter into written agreements with employee organizations on matters of wages, hours, and other terms and conditions of employment; (3) maintaining merit-system principles among public employees. (§ 2 ch 113 SLA 1972).”  AS 23.40.070.

Under Alaska law, the state and many municipalities operate what is called an “agency shop” where all employees in certain classifications are required to pay union dues in order to be employed.  Alaska Statute 23.40.225 was amended in 1976, providing an exemption from payment of an agency fee for religious reasons, but allowing the union to collect an equivalent amount as the agency fee and contributing it to a charity.  However, the Labor Relations Board has kept to the strict language for the statute, limiting the exception to cases of “bona fide religious convictions based on tenets or teachings of a church or religious body.”

A year later in 1977, the U.S. Supreme Court ruled in Abood v. Detroit Board of Education, 431 U. S. 209, 234 – 235, 95 L.R.R.M.(BNA) 2411 (1977), that public employees could not be required to fund union expenses that are not “germane to the duties of bargaining representative” based on the First Amendment right to free speech.  Abood required union dues/agency fees to be apportioned between expenses related to collective bargaining, (like negotiations and grievance representation,) and political and ideological expenses of the union.  Under the Abood decision, collective bargaining expenses could be charged to an employee based on the idea that the employee receives the benefit of these services; as opposed to political expenses which are used to support a particular viewpoint.  The Court in Janus overruled Abood and expanded the free speech protection to object to all union activities.

The First Amendment to the United States Constitution, as interpreted by the Supreme Court, trumps Alaska law and the intentions of the Alaska legislature.  Thus, the new law of the land is public employees cannot be compelled to join a union or pay union dues; there is no more “agency shop.”  It should be noted that the Court’s decision does not apply to private employers who may continue to operate closed shops as negotiated under the National Labor Relations Act (NLRA), contrary to speculation of some news reporters and pundits.  The Janus decision is only in regard to government action; private employers still have the ability to limit most free speech.

For Municipalities that are not subject to PERA, the possibilities are wide open.  For PERA municipalities, there are still a number of options, but awaiting guidance from the Labor Relations Board may be a good idea. The Labor Relations Board is currently analyzing the decision internally as to what statutes and regulations will need amendment.  Under current contracts, where the union is the exclusive representative of a class(es) of employees, the union remains the exclusive representative and all currently represented employees remain represented employees. However, individual employees may now choose not to pay dues or agency fees to the union.

There are a number of options ranging from doing nothing and letting the represented employees and unions “work it out.”  The downside of ignoring the issues is not only the municipality losing any control over the discussion, but, more importantly perhaps, the municipality needs to have a system for addressing the issue of union membership and dues collection for new employees and existing employees choosing to exercise their right to decline membership.