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In the less touted of the two decisions issued on the final day of the Supreme Court’s 2013-2014 term, Harris v. Quinn, the Court handed the Service Employees International Union (SEIU) another stinging defeat on the much mooted question of whether the union could force “personal assistants” to pay union dues when they don’t want to become union members in the first place. These personal assistants, often family members, receive state and federal funds so that they can help support individuals who are ill or incapacitated instead of placing them in some institutionalized care setting, which typically comes at a far higher cost. The decision divided along the all too familiar 5-4 liberal/conservative split. On this occasion, that split led to strong dueling opinions between Justice Samuel Alito for the majority and Justice Elena Kagan for the dissent.
What is striking about these opinions is that the prior convictions of the justices are so deep that no one will change their minds after reading them. At a constitutional level, the issue is whether forced contributions of dues to a union constitute a form of coerced political speech that runs afoul of the First Amendment. The standard “agency-fee” or “fair share” provisions require all non-union members “to pay their proportionate share of the costs of the collective-bargaining process, contract administration and pursuing matters affecting wages, hours and conditions of employment.” Addressing these provisions in the context of teacher unions, the Supreme Court, in its 1977 decision of Abood v. Detroit Board of Education, held these bargaining unit expenditures did not run afoul of the First Amendment, so long as sufficient effort was made to segregate out pure political contributions that the employees were forced to contribute against their will.
Although Justice Alito voiced his general unhappiness with this fair share requirement in his 2012 decision in Knox v. SEIU, he chose not to pull the trigger in today’s case. Instead, after taking several jabs at Abood, he decided the case on the collateral grounds that Abood did not apply because the elaborate arrangements that Illinois put together under its Public Labor Relations Act did not create any employment relationship at all. The dissent of Justice Kagan fought Alito tooth and nail at both levels. She strongly supported Abood, in large measure because of the huge number of public service union contracts that were formed in reliance on it. She also insisted that the state’s general oversight responsibilities made it a “joint employer” along with the caregiver, who receives for his or her labor payments that are heavily supported by the federal Medicaid budget.
On the larger question in this case, I think that Abood offers the wrong starting point for a general analysis. The key question should be whether any labor union should be allowed to force an employer to negotiate with it in good faith when the union, by statute, becomes the exclusive bargaining agent once it obtains a majority of votes from the members of the bargaining unit. In dealing with this issue, the conventional wisdom, adopted by Justice Kagan in her dissent, is that these arrangements are completely unproblematic because, on average, they improve the lot of the workers who are subject to them.
I regard that as an incomplete analysis because it ignores the social losses created by monopoly unionization, even when the sole topic of negotiation is economic issues in the private sector. Public unions are, on this view, even worse, because the state essentially allows those workers to extract monopoly rents from the public at large with the blessing of the state legislature. The system is even worse in Harris, because the money in question comes largely from the federal government, so that the combined effect of these plans is to raise wages and benefits above the competitive level, and to spend a large amount of public money to keep the system in place.
In addition, the standard calculus gets matters wrong when it assumes that anyone who wants to stay out of a union does so solely because they wish to free-ride on the collective efforts of dues-paying members. As a simple empirical matter, there are people who think that it is wrong for unions to use their collective might. And there are others who think that the benefits obtained from unionization are not worth the increased dues, the added administrative bother, and the higher economic uncertainty that unions give. To treat the dissenters as free riders misses the point; and the issue could be obviated by allowing the union to negotiate benefits solely for its members, leaving outsiders to their own devices.
The initial differences on the desirability of collective bargaining frame the particular issues. To Justice Alito, the supposed state employment was a sham relationship. A close look at the statutory provision indicates that all the usual indicia of an employment relationship are missing from this case. The state is not vicariously liable for the wrongs of its employees. The employees are excluded from the full range of retirement, health care, sick pay, family leave, and unemployment benefits. The state refuses to call itself an employer with respect to the services that these personal assistants render. It retains no control over the decision of whether these persons are hired or fired.
To Justice Kagan, these labels don’t really matter for the constitutional issue, but I think that she is mistaken to apply that principle in this context. It is surely the case that an employer cannot duck its obligations under statute by calling itself an independent contractor. Those designations are efforts to deflect the force of mandatory statutes. In this instance, however, when the states refuse to take on the responsibilities of an employer, the recharacterization is not imposed to put additional duties on Illinois in the areas where it seeks to evade its responsibility. Rather, the entire statutory scheme is a ruse to make sure that workers can be state employees solely for the purpose of collective bargaining but not for any other purpose. It does not help that this deal was a back room concoction between then-incoming governor Rod Blagojevich and the SEIU, done by executive order after the union was unsuccessful in earlier efforts to obtain these benefits through the Illinois Labor Relations Board (which denied the application in large measure on the grounds that Illinois did not exercise sufficient control over these workers to be deemed their employer).
In the end, therefore, the clear test for the state is whether it will put up or shut up. If it wants to let the SEIU in on the ground floor, then it has to take on real employer responsibilities — which would be simply irresponsible. Justice Kagan is right that mere labels do not control, but she is wrong to think that the weak oversight that the state exercises over various personal assistants who work at home, often taking care of their own family relatives, is anything other than a weak regulatory arrangement. Applying her standard consistently would make the state an employer virtually any time it regulates some portion of a basic labor contract. The usual joint employee relationship involves borrowed laborers, where a given employee works full-time for one employer who hires him out to a second who supervises his on-site efforts. In those cases, both parties have a real say, and, for purposes of vicarious liability, neither employer can escape simply by pointing to the ostensible control of the other. That is decidedly not the system here. The state of Illinois sought to grant yet another freebie to the SEIU. The Court was right to conclude that this was not a bone fide employment relationship with the state, which would have allowed it to enter into a collective bargaining agreement with SEIU. Abood does not control.Published in