Do Union Compulsory "Agency Shop" Fees Violate the First Amendment?

On June 30, 2015, the Supreme Court of the United States agreed to hear an appeal in Friedrichs v. California Teachers Association to answer the question of whether compulsory "agency shop" fees violate the First Amendment. An "agency shop" arrangement requires non-union member employees to pay compulsory fees as a condition of employment even if the employees decide not to join the union. Currently, approximately twenty-five (25) states provide its teachers and other workers with the choice of whether or not to pay union fees.

The California Government Code provides that a union may become the exclusive bargaining unit representative for public school employees by certifying that a majority of the employees in the unit wish to be represented by the union. (Gov. Code, section 3544, subd. (a).) After becoming the exclusive bargaining unit, the union may establish an "agency shop" arrangement whereby all employees "shall, as a condition of continued employment, be required either to join the recognized employee organization or pay the fair share service fee." (Gov. Code, section 3546, subd. (a).) However, the agency fees must be limited to activities "germane" to collective bargaining. (Gov. Code, section 3546, subd. (b).) California law requires unions to estimate the portion of expenses that do not fall into these germane activities, or non-chargeable fees, and send a notice to non-members setting forth the non-chargeable fees to which non-members may opt-out by requesting a rebate or fee-reduction for that year. (Gov. Code section 3546, subd. (a); Cal. Code Regs., tit. 8, section 32992, subd. (a).)

Rebecca Friedrichs, a California teacher, along with her co-plaintiffs and appellants, represented by the Center for Individual Rights, opted out of union membership. They filed a suit against their local unions, the National Education Association, and the California Teachers' Association arguing that compulsory union fees violate their rights to freedom of speech and association under the First and Fourteenth Amendments of the U.S. Constitution. They further argue that the "opt-out" procedure to receive non-chargeable fee rebates (as opposed to an opt-in procedure where the non-union members affirmatively agree to pay these non-chargeable fees) violates these same rights. They contend these procedures take away their rights to decide whether to join and pay dues to an organization that purports to speak on their behalf.

In asking the Court to decide whether their First Amendment rights are violated under the current law, plaintiffs ask the Supreme Court to overrule its 1977 decision in Abood v. Detroit Board of Education. Abood held that (1) insofar as service fees were used to finance expenditures by the union for collective bargaining, contract administration, and grievance purposes, agency shop clauses in bargaining agreements were valid and (2) First Amendment principles prohibited unions and boards of education from requiring any teacher to contribute to support an ideological cause the employee might oppose, as a condition of employment. However, the Supreme Court deferred determining whether the Abood unions violated the First and Fourteenth Amendments because the union had instituted an internal policy which permitted dissenters not to pay dues for certain political activities. The Supreme Court thus rejected the argument that the only funds unions could require non-members to pay were those funds that non-union members affirmatively consented to pay.

The Federal trial court that first heard Friedrichs upheld current agency shop fee laws under Aboodand other Ninth Circuit Court of Appeals precedent, which held that the First Amendment does not require an "opt in" procedure for non-union members to pay equal fees as union members. However, the District Court did not engage in an in-depth discussion of plaintiffs' claims. The trial court simply determined that these prior cases foreclosed plaintiffs' claims. On appeal, the Ninth Circuit found that the plaintiffs' claims were foreclosed under current Supreme Court and Ninth Circuit precedent and did not go into a discussion of the merits of the claims.

That the U.S. Supreme Court granted review to hear arguments despite Abood, raises doubt as to its validity. A Supreme Court decision reversing the Ninth Circuit's decision could destabilize unions; union members could use threats of opting out of union membership as a way to influence which internal grievances the union supports; and membership and revenues could decline.

The Supreme Court will likely hear oral arguments in the Fall of 2015 and is not likely to issue a decision in Friedrichs v. California Teachers Association until late June of 2016. We will continue to monitor this case and update you as it proceeds.

Alysha Stein-Manes, attorney in the Los Angeles office of Liebert Cassidy Whitmore, provides representation and counsel to LCW clients in all matters pertaining to labor, employment, and education law.

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