Case Summary and Outcome

The Supreme Court of the United States overturned its previous case law and held that a union fee arrangement that required non-member public sector employees to pay certain agency fees was incompatible with the right to free speech. Illinois Public Labor Relations Act (IPLRA) allowed for “exclusive representative” unions of state employees to automatically charge “agency fees” to non-members for collective bargaining purposes. Mark Janus, a child support specialist employed by the state of Illinois, refused to join his representative union and sued to have IPLRA declared unconstitutional. The United States Supreme Court found the arrangement to amount to unconstitutional compelled speech since it required that public sector employees subsidize speech even when they disagreed with it. The majority of the Supreme Court was unconvinced that the arrangement was the least restrictive means of achieving “labor peace” and eliminating “free riders” (those who benefitted from the system without paying for it.

Facts

The Illinois Public Labor Relations Act (IPLRA) allowed public employees of the state to unionize. Under IPLRA, a union could become the “exclusive representative” of a group of employees when it received a majority of favorable votes from employees in the relevant unit. This meant that the union was the only party allowed to negotiate with the employer (collectively bargaining) on behalf of the employees on matters like wages, hours, and conditions of employment, as well as “policy matters” like the size of the work force, promotion methods, and non-discrimination policies.

Employees could decline membership in the exclusive representative union, but they were still automatically charged a percentage of union dues for collective bargaining purposes called “agency fees”. This was the case even if these non-member employees strongly disagreed with positions adopted by the union. The fees that had to be paid by all employees only related to certain expenditures made by the union, such as collective bargaining and contract administration. Expenditures related to the election or support of any candidate for political office were “nonchargeable expenditures.” The onus was on the union to set out what was or was not chargeable and notify all employees.

Mark Janus was a child support specialist employed by the Illinois Department of Healthcare and Family Services. Janus’ unit was exclusively represented under IPLRA by the American Federation of State, County, and Municipal Employees, Council 31 (AFSCME). Because Janus disagreed with “many of the public policy positions” for which the union advocated, he refused to join the union. Nonetheless, in accordance with the IPLRA, he still had to pay agency fees to the union. Janus challenged the IPLRA before the courts, claiming that the agency fees amounted to unconstitutional coerced speech that violated the First Amendment.

The District Court dismissed Janus’ case, finding the agency fee arrangement acceptable under Abood v. Detroit Board of Education. The Seventh Circuit Court of Appeals affirmed the District Court’s decision. Janus sought review in the Supreme Court of the United States, and the Supreme Court granted certiorari to consider IPLRA and public sector agency fee arrangements.

Decision Overview

Alito, J., delivered the opinion of the Supreme Court of the United States (Court). The overarching question for the Court was whether Abood v. Detroit Board of Education, a 1977 case that upheld union shops for public sector employees, was compatible with the First Amendment of the U.S. Constitution. In that case the Supreme Court upheld an agency fee arrangement like the one in Illinois under IPLRA. The First Amendment forbids laws that abridge the freedom of speech. According to a long line of Supreme Court cases, the freedom of speech “includes both the right to speak freely and the right to refrain from speaking at all.” [p. 8] The Court went on to state that compelled speech caused additional damage compared to restrictions on speech, since “in that situation, individuals are coerced into betraying their convictions. Forcing free and independent individuals to endorse ideas they find objectionable is always demeaning”. [p. 9] The Court concluded that compelling a person to subsidize the speech of other private speakers raised similar First Amendment concerns.

In this case, the Supreme Court examined to what extent the First Amendment protected the compelled subsidy of speech in the public sector. The Court opted to re-examine Abood under the “exacting scrutiny” standard, declining to decide whether the more heightened “strict scrutiny” should apply. According to the Supreme Court, under the “exacting scrutiny” standard, compelled subsidies for speech had to “serve a compelling state interest that cannot be achieved through means significantly less restrictive of associational freedoms.” [p. 10] The Court applied this standard and rejected the two defenses put forth by the State to justify the fee arrangement. The first defense was that of “labor peace”, which they argued was assured by the designation of one single union to negotiate with an employer. The Court found that “labor peace” could readily be achieved “through means significantly less restrictive” than agency fees. The second defense was the risk of “free riders”, whereby employees would be inclined to remain non-members to benefit from the union’s activities without paying for them. The Court did not find this to be a compelling interest and mentioned the fact that many individuals benefit from the speech of private groups without having to subsidize those groups.

The Court then considered the Union’s argument that the First Amendment provides no or limited protection for public employees. The Court found no basis for the conclusion that the First Amendment provided no free speech protection for public employees. It then went on to consider whether the argument that Pickering v. Board of Education (Pickering) should apply. Under Pickering public employee speech is largely unprotected if it is part of what an employee is paid to do or if it involved a matter of only private concern. When a public employee speaks on a matter of public concern, the employee’s speech is protected unless “the interest of the state, as an employer, in promoting the efficacy of the public services it performs through its employees outweighs the interests of the [employee], as a citizen, in commenting upon matters of public concern.” [p. 22] The Court began by observing that the Pickering test applied in a very different context and did not fit well with a case where the government compels speech or speech subsidies in favor of a third party. Nonetheless, the Court proceeded to apply the Pickering test to the present case. Firstly, the Court noted that the speech was not something that the employees were paid to do by the employer (it was not the employer’s speech). Secondly, the Court went on to consider whether the speech was a matter of public or private concern. The Court noted that speech on public matters “occupies the highest rung of the hierarchy of First Amendment values … [meriting] special protection.” [p. 31] In the U.S., many individual states have severe budget issues complicated by prodigious liabilities to public employees. In collective bargaining, unions negotiate matters such as pension spending, health insurance benefits, holidays, overtime, promotion policies, wage increases, tax increases, all while making their stance on other “controversial subjects” heard as well. [p. 30] The Court concluded that to say that such speech was not of public concern was “to deny reality.” [p. 29] Finally, the Court had to determine whether the State’s proffered interests justified the “heavy burden that agency fees inflict on nonmembers’ First Amendment interests”. [p. 31] The Court could find no evidence that the absence of agency fees would cripple public-sector unions and, thus, impair the efficiency of government operations. In light of the above, the Court concluded that public sector agency-shop arrangements violated the First Amendment of Abood erred in concluding otherwise.

The Court then had to decide whether stare decisis required the Court to follow Abood even if the case was inconsistent with the First Amendment. Stare decisis is the legal principle that requires courts to follow previous decisions with similar facts and legal issues, and is a foundation of the U.S. common law legal system. The Court looked at “the quality of Abood’s reasoning, the workability of the rule it established, its consistency with other related decisions, developments since the decision was handed down, and reliance on the decision”, and concluded that Abood could be overturned. [p. 35]

In conclusion, the automatic deduction of fees from employees who were not members of the union under the IPLRA was unconstitutional. Illinois’ agency fee arrangement violated the free speech rights of nonmembers by compelling them to subsidize speech. The interests of the state were not significant enough to overcome the infringement of First Amendment rights. The Court did not question the constitutionality of exclusive representation arrangements for unions, or union fees collected with a clear and affirmative waiver from the employee. The Court formally overturned Abood and reversed the Seventh Circuit Court of Appeals, remanding the case to the district court for proceedings consistent with the ruling.

Kagan, J., wrote a dissenting opinion. Justice Kagan dissented to thoroughly refute the majority’s decision to overrule Abood. Justice Kagan disagreed with the majority’s approach to Pickering, and saw it as a significant departure from the Court’s case law on the extent to which the First Amendment protects the speech for public employees. Justice Kagan found the reliance of more than 20 states, their unions, and millions of employees overwhelming in the face of deviating from the stare decisis flowing from Abood. Summarily, “The majority overthrows a decision entrenched in this Nation’s law — and in its economic life — for over 40 years. And it does so by weaponizing the First Amendment, in a way that unleashes judges … to intervene in economic and regulatory policy … [when] almost all economic and regulatory policy affects or touches speech.” [Kagan, J., p. 26] Sotomayor, J joined the dissent but wrote a separate opinion.