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Analysis: Janus v. American Federation of State, County, and Municipal Employees

Deborah Dinner |

DinnerThe Supreme Court dealt a significant blow to public-sector unions in Janus v. American Federation of State, County, and Municipal Employees, ruling 5 to 4 that states could not require government employees to pay union fees. The Illinois law struck down in the case permitted public-sector collective bargaining agreements to include a provision allowing unions to charge employees who did not join as members. The majority opinion in Janus held that such agency fees amounted to government-compelled speech in violation of nonunion members’ First Amendment rights.

The court’s majority reversed a decades-old precedent affirming the constitutionality of agency fees, also known as fair-share fees. In Abood v. Detroit Board of Education (1977), a unanimous court held that public-sector unions could charge nonmembers for the cost of collective bargaining. Abood conversely prohibited unions from charging nonmembers for the cost of political or ideological expenses. Justice Alito’s majority opinion in Janus, joined by Chief Justice Roberts and Justices Kennedy, Thomas and Gorsuch departed from Abood to apply an “exacting” standard of scrutiny. A state must show that a regulation interfering in free speech “serve[s] a compelling state interest that cannot be achieved through means significantly less restrictive of associational freedoms.” The court held that the two justifications for agency fees articulated in Abood did not meet this higher standard. To begin, agency fees were not necessary to maintain “labor peace” because a state could still bargain exclusively with one union, even in the absence of agency fees.

In addition, the majority held that avoiding “free riders” does not constitute a compelling interest. Much of the debate in the Janus litigation centered on this idea, which economists use to describe people who benefit from a cause without contributing to it. The respondent argued that a ruling in favor of the petitioner Janus would decimate unions. Prohibiting agency fees makes it more attractive for workers not to join unions—employees are able to reap the benefits of collective bargaining without paying anything at all. Many argue that agency fees are fair in significant part because unions have a duty of fair representation; they are legally compelled to bargain on behalf of nonmembers and not to discriminate against them. Alito, however, was quite dismissive of the argument, writing that Janus “argues that he is not a free rider on a bus headed for a destination that he wishes to reach but is more like a person shanghaied for an unwanted voyage.”

Justice Kagan’s robust dissent, joined by Justices Ginsburg, Breyer and Sotomayor, criticized the majority for giving short shrift to the principles of stare decisis. While Alito stressed that subsequent cases had chipped away at Abood’s central holding, Kagan chided the majority for using scattered dicta to reverse longstanding doctrine. The dissent also emphasized the reliance interests of states and unions alike in the jurisdictions that had agency-shop rules similar to that in Illinois. “The majority overthrows a decision entrenched in this nation’s law – and in its economic life . . . .” Kagan concluded that by “weaponizing the First Amendment” the majority imposed the justices’ own view of appropriate workplace governance in place of that which multiple states’ electorates had democratically selected. Kagan’s conclusion is suggestive: we may locate Janus within a series of cases in which corporations have used the First Amendment to thwart legislative regulation.

Janus is particularly significant because of the role that public-sector unions play in efforts to realize economic security for workers. Since their apex at midcentury, unionization rates in the private sector have declined significantly. By contrast, changes in state and federal laws in the period between 1959 and 1975 allowed for the dramatic growth of public-sector unions. Today, unionization rates in the public sector (34.4%) far exceed those in the private sector (6.5%), and just under half of union members in the United States are public employees. It is therefore of no surprise either that conservative activists have targeted public-sector unions in recent years, or that organizations dedicated to pursuing free-market and anti-labor policies, such as the Cato Institute and Pacific Legal Foundation, supported the petitioner.

In vitiating fair-share rules in 22 states and the District of Columbia, Janus threatens to shrink the membership and the coffers of public-sector unions. The decision has effectively mandated a “right-to-work” regime—the ironic name that anti-labor advocates have given to laws prohibiting union agency fees—in the public sector. Some labor economists have predicted that the decision will reduce the annual labor income of public-sector employees by $16.8 billion across the nation. Still, it is possible that the decision will serve as a rallying cry and galvanize workers to organize collectively. Unions will need to be more creative in their campaigns, but recent news reports suggest that they remain stalwart in their resolve.

Deborah Dinner, associate professor