2007 POLICY HIGHLIGHTER

March 19, 2007

HB 2079: Regarding the use of union fees for political activity
Volume 17, Number 9

By Michael Reitz

Introduction
House Bill 2079 amends RCW 42.17.760, which requires labor organizations to get permission from individual nonmembers before using their agency fees for political activity. The constitutionality of the statute is currently under review by the U.S. Supreme Court in the consolidated cases of Davenport v. Washington Education Association and Washington v. WEA.

HB 2079 presents several concerns. Rushing to amend the statute with a Supreme Court case pending is ill-advised, and the bill could render the statute ineffective. The bill could be deemed unconstitutional, as the Supreme Court has previously rejected the accounting mechanism proposed in this legislation. The bill could endanger the constitutionally-mandated refund nonmembers are entitled to under the Hudson case.

Finally, HB 2079 contains an emergency clause, which insulates it from a voters’ referendum. Preserving a union’s political funding is not an emergency worthy of denying the voters their constitutional right of referendum.

Background
Washington labor law allows labor organizations to collect “agency shop” fees from individuals in the bargaining unit who are not members of the labor organization. Agency fees may be an amount equivalent to full membership dues. RCW 42.17.760 currently prohibits labor organizations from using agency fees to make contributions or expenditures to influence an election or to operate a political committee, unless “affirmatively authorized” by the individual.

The U.S. Supreme Court has acknowledged that even to compel employees financially to support their collective bargaining representative “has an impact upon their First Amendment interests.” Abood v. Detroit Board of Education, 431 U.S. 209, 222 (1977). Union expenditures for causes not germane to collective bargaining must be financed “by employees who do not object to advancing those ideas and who are not coerced into doing so against their will by the threat of loss of governmental employment.” 431 U.S. at 235.

The question, therefore, is how to appropriately safeguard the First Amendment rights of workers who have chosen not to join a union. This question has been the subject of extensive litigation, and Supreme Court precedent offers guidance on the proper collection and use of agency funds.

Effect of the bill
As stated above, RCW 42.17.760 requires unions to get advance permission from nonmembers before using their fees for political purposes. House Bill 2079 amends the statute by stipulating that a union does not “use” agency fees for politics when its spends out of its general treasury funds and has sufficient revenues from other sources to cover its political spending.

In other words, the agency shop fees are reserved as the last dollars spent out of the union’s general treasury. Thus, if a union’s income from nonmember agency fee payers is 10 percent of its total budget, the union could conceivably spend 90 percent of its funds on political activity before triggering the requirement to obtain permission from agency fee payers. The practical effect of HB 2079 is that unions will rarely, if ever, be required to seek authorization from agency fee payers before using their payments for political activity.

Concerns with HB 2079
HB 2079 presents several constitutional problems. The Supreme Court has acknowledged that payment of agency fees impinges on the First Amendment rights of workers. The proper remedy is to reduce nonmember union payments by the percentage of union expenditures on non-bargaining activities, based on the union’s previous fiscal year. The Court has rejected as insufficient the accounting mechanism contemplated in HB 2079.

Several cases explain why this is a problem. First of all, it shifts a disproportionate share of collective bargaining costs to nonmembers. In International Association of Machinists v. Street (1961), the Court said unions should reduce objectors’ fees by the percentage of the union’s total budget spent on politics. Unions, however, “should not be in a position to make up such sum from money paid by a nondissenter, for this would shift a disproportionate share of the costs of collective bargaining to the dissenter and have the same effect of applying his money to support such political activities.” 367 U.S. 740, 773.

The Court affirmed this in Abood v. Detroit Board of Education (1977). “It is plainly not an adequate remedy to limit the use of the actual dollars collected from dissenting employees to collective-bargaining purposes.” Such a limitation “is of bookkeeping significance only rather than a matter of real substance.” 431 U.S. 209, 237. The Court quoted Retail Clerks v. Schermerhorn (1963) to explain why this is problematic. “[I]f nonmember payments, equal to those of a member, go entirely for collective bargaining costs, the nonmember will pay more of these expenses than his pro rata share. The member will pay less and to that extent a portion of his fees and dues is available to pay institutional expenses. The union’s budget is balanced. By paying a larger share of collective bargaining costs the nonmember subsidizes the union’s institutional activities.” 373 U.S. 746, 753-54.

Supporters of HB 2079 have repeatedly referenced the Hudson process as being adequate to protect the rights of non-union workers. The Supreme Court held in Chicago Teachers Union v. Hudson (1986) that, at a minimum, the constitutional collection of agency fees should include an adequate explanation of the basis for the fee, an opportunity to challenge the amount of the fee before an impartial arbitrator, and an escrow for the amounts reasonably in dispute while such challenges are pending. The objecting worker is entitled to a refund of the portion of their dues that supported non-bargaining expenditures.

HB 2079 does not solve any purported accounting questions, as sponsors claim. In fact, it creates new problems. Unions need only refund the percentage of dues actually spent on non-bargaining activity. By arbitrarily stating that agency fees are not spent on politics, HB 2079 could deny nonmembers a refund of the union’s political spending, as required by Hudson.

Apart from constitutional concerns with HB 2079, enforcement is also problematic. Short of mandating an annual audit of union books by the Public Disclosure Commission or some other government agency, compliance will be difficult to verify.

Sponsors cite the need for “clarity” in urging adoption of HB 2079. This clarification is unnecessary. A Washington superior court has already ruled on the interpretation of RCW 42.17.760 and provided detailed instructions on how to comply. According to the Seattle Times, this bill was drafted by the Washington Education Association—a repeat violator of the campaign finance statutes. Relying on the scofflaw union to define compliance is bad public policy and could undermine the public’s confidence in the integrity of the electoral process.

Finally, HB 2079 contains an emergency clause, thereby insulating the bill from a voter’s referendum. Preserving a union’s coerced political funding is not a state emergency. RCW 42.17.760 was enacted by Initiative 134, approved by 72 percent of voters in 1992, and voters deserve the opportunity to review the legislature’s amendment of this law.

Conclusion
HB 2079 presents a myriad of concerns. The constitutionality of the “affirmative authorization” requirement in RCW 42.17.760 is currently under review by the U.S. Supreme Court. Rushing to amend the law before the Court rules is premature. Any amendment of the law ought to conform to the clear constitutional guidelines laid out in Abood and its progeny. The legislature’s appropriate course of action would be do delay any legislative amendments to RCW 42.17.760 until the U.S. Supreme Court has ruled on the underlying constitutionality.

Michael Reitz is general counsel of the Evergreen Freedom Foundation and director of EFF's Constitutional Law Center. He is a member of the Washington and California Bars and is admitted to practice before the U.S. Supreme Court and the U.S. Court of Appeals for the Ninth Circuit. His research has been published and cited by the Wall Street Journal, the Los Angeles Times, the Boston Globe, the Seattle Times, and numerous other newspapers and periodicals. He is a co-author of To Protect and Maintain Individual Rights, a reference guide to the Declaration of Rights in the Washington Constitution, and he maintains the Supreme Court of Washington Blog. Michael is a graduate of the Oak Brook College of Law.

+ Send EFF your comments

  Send this Article to a Friend