Supreme Court Decision on Fair Share Fees

In a 5-4 decision this morning, the United States Supreme Court ruled in favor of the Petitioner in the case of Janus v. American Federation of State, County, and Municipal Employees, Council 31, et al.  The Court held that it is unconstitutional for public-sector employees in unionized workplaces to be compelled to pay “agency fees” (AKA “fair share fees”) to the Union to support the costs associated with the Union’s duties in acting as the employees’ exclusive bargaining agent.  Although the law at issue in Janus was an Illinois state statute, specifically certain subsections of the Illinois Public Labor Relations Act, the ruling directly impacts the Pennsylvania Public Employee Fair Share Fee Law in holding that the compelled payment of such fees are in violation of the free speech provisions of the First Amendment.

In brief, the Court concluded that a 1977 Supreme Court decision, Abood v. Detroit Board of Education, which had upheld the legality of fair share fees, was wrongfully decided and was inconsistent with First Amendment jurisprudence.  The Court held that compelling the payment of fair share fees from union members who disagreed with positions taken by the union was tantamount to compelling speech in that it “violate[d] that cardinal command” that “no official…can prescribe what shall be orthodox in politics…or force citizens to confess by word or act their faith therein.”  “Compelling a person to subsidize the speech of other private speakers raises similar First Amendment concerns…because the compelled subsidization of private speech seriously impinges on First Amendment rights, it cannot be casually allowed.”

At this time, public employers must take steps to immediately comply with the Supreme Court’s decision and avoid potential First Amendment violations.  To that extent, Maiello, Brungo, and Maiello is recommending that our clients take the following steps:

  1. Review your current collective bargaining agreements to ascertain if the agreement contains a provision requiring the employer to collect fair share fees.
  1. Determine which, if any, employees are currently having fair share fees deducted from their paychecks. If the employer determines that certain employees are paying fair share fees, the employer should immediately contact the appropriate labor organization and employee to inform all parties of the employer’s intent to cease collection of these fees and discuss next steps for any fair share fees that have been collected by the employer, but not turned over to the labor union, or the refund of any front loaded fees that have been collected but are attributable to future pay periods.  Our office can assist in this communication.
  1. If the employer has employees who have fair share fees automatically deducted from their paychecks, the employer should immediately take steps to cease this practice. Further, the employer should confirm how these fair share fees are paid.  For example, the employer should ascertain if the fees are automatically deducted from employees’ paychecks or if those fees are pre-paid, and on what basis.  The employer should reach out to the union’s business agent or representative to discuss this.

It is anticipated that additional issues will arise as the effects of this decision become clear.  We encourage communication among affected employers, employees, and labor organizations in order to ensure a smooth process in the application of this ruling to the operations of the public employers.  Please contact our office with any additional questions related to this decision.