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Congressional Democrats Seek to Undermine Janus Decision

Last week, the Supreme Court held in Janus v. AFSCME that requiring non-members to pay fees to a union as a condition of employment violates the First Amendment rights of public employees. The decision reverses Supreme Court precedent in Abood v. Detroit Board of Education. Under Abood, government employee unions could charge non-union members an agency fee to cover the cost of activities germane to collective bargaining.  

However, government unions are inherently political, so the Supreme Court decision found that agency fees are inconsistent with the First Amendment. “Forcing free and independent individuals to endorse ideas they find objectionable is always demeaning,” Justice Samuel Alito wrote in the majority opinion.

Despite union hysterics, this decision does not impede or prohibit workers’ right to unionize or collectively bargain in the public sector. Government unions will simply have to compete for membership and funding like every other membership-based organization.

But Democrats in Congress are taking the threat of reduced campaign contributions from government unions seriously. Shortly after the Janus decision, prominent Democrats in the House and Senate introduced the Public Service Freedom to Negotiate Act of 2018 (PSFNA).

In a press release from the office of Sen. Mazie Hirono (D-HI), the Senator indicated that the legislation is necessary because, “We must fight back against this unrelenting attack on working people.” Hirono goes on to say, “At the heart of this political campaign is an effort to undermine and weaken unions.”

Hirono’s rhetoric is meant to be in support of unions, but certainly undermines them. If giving workers a choice on how they spend their hard-earned wages will inevitably weaken unions, that probably means unions are not providing a service workers value.

Public Service Freedom to negotiate Act of 2018: Findings and Purpose

Before providing a summary of the particulars of the bill, it is worth diving into the “Findings and Purpose” of the Act. Right off the bat, it is clear the authors of the legislation are not familiar with state labor relations laws. The bill states:

The denial by some public employers of the right of public employees to organize and the refusal by some public employers to accept the procedure of collective bargaining lead to strikes and other forms of strife and unrest.

No state prohibits public employees of the right to organize. Some states like Virginia and North Carolina prohibit public employers from entering into collective bargaining agreements with labor unions, but do not ban workers’ right to organize. As seen in Virginia, labor unions have organized public employees and receive subsidies from the state in order to attend employee group meetings with public officials.  

Empirical evidence also refutes the bill’s conclusion on public employee strikes. States with union-friendly collective bargaining laws experience greater labor strife. The Freedom Foundation “analysis found data indicated that government employees in agency-fee states went on strike at 27 times the rate of public employees in right-to-work states.”

The Findings and Purpose make another spurious claim: that collective bargaining in the public sector “safeguards the public interest.” The motivation behind Mark Janus joining the lawsuit was his belief that the union’s “behavior in bargaining does not appreciate the current fiscal crises in Illinois and does not reflect his best interests or the interest of Illinois citizens.”

Also discussed in the Janus decision is how AFSCME refused to agree to cost-saving measures during bargaining negotiations—a necessity because of Illinois’ enormous pension and healthcare liabilities, which total over $100 billion. Labor unions acting as an obstacle to tackling such unsustainable liabilities does not safeguard the public interest.  

PSFNA Imposes Collective Bargaining Requirements on State and Local Governments

The purpose of the PSFNA is to secure collective bargaining rights for state and local public employees. This is achieved by requiring public employers in the states to provide a minimum level of “rights” to public employees, which include, but are not limited to:

  • Granting public employees the right to self-organization, to form, join, or assist a labor organization, and to bargain collectively through representatives of their own choosing.
  • Require public employers to recognize labor unions chosen by employees and collectively bargain with such recognized labor organization.
  • Providing for the payroll deduction of labor organization fees to any duly selected representative of public employees pursuant to the terms of an authorization executed by such public employees.
  • Prohibit practices that interfere with, coerce, or intimidate public employees in the exercise of their rights to either join or refrain from forming a union.

The above legal requirements are, for the most part, extremely broad and vague. What practices will be considered to interfere with public employees’ ability to unionize? For example, some states require newly hired public employees to sit through a union captive audience meeting, which gives the union the opportunity to persuade employees to join. If a state does not require such meetings, are they in compliance with the PSFNA? That is one of many questions that will arise from the sweeping legislation.

Ultimately, the legislation is a solution in search of a problem. The vast majority of state and local public employees currently enjoy collective bargaining privileges. 

Who Enforces the PSFNA?

The more concerning aspect of the bill is it grants broad power to the Federal Labor Relations Authority (FLRA), which currently governs only federal employee labor relations, to enforce the legislation and to determine whether states are in compliance with its requirements.

In 180 days after the enactment of the PSFNA, the FLRA will make a determination on whether a state meets the collective bargaining requirement standards of the Act. A state that fails to provide the required collective bargaining standards will be subject to the regulations and procedures promulgated by the FLRA.

Within one year after the enactment of the PSFNA, the FLRA will issue regulations that establish “collective bargaining procedures for public employers, labor organizations, and public employees in the states … which do not substantially provide for such rights.” The FLRA’s regulations will essentially override current state labor relations law and establish collective bargaining procedures for the state.

The FLRA also becomes responsible for supervising or conducting union elections in the states, as well as determine what constitutes an appropriate bargaining unit.

In addition, the FLRA is given significant power to ensure the Act is properly administered. The FLRA may issue subpoenas to require testimony or the production of evidence. To enforce the PSFNA, the FLRA has the power to issue orders that direct state and local public employers to comply with the law.

Congress will also need to greatly increase funding to the FLRA. Examining and enforcing collective bargaining standards on state and local governments across the country is not a simple or inexpensive task. The agency will have to hire a number of new employees and likely create field offices in states that fail to comply with the new collective bargaining standards.

Can Congress Regulate State Employer-Employee Relations Under the Commerce Clause?

Beyond whether the bill is good or bad policy, it would constitute a massive federal power grab. Never before has the federal government interfered to this extent with state employer-employee labor relations. To justify such federal overreach, the legislation invokes the Commerce Clause.   

The federal government has never imposed collective bargaining requirements on the states before, so it is unclear whether the legislation would pass constitutional muster. Analysis of a previous bill, which did not pass, argues it is murky whether Congress has the authority under the Commerce Clause to impose collective bargaining requirements on states. The 2007 Public Safety Employer-Employee Cooperation Act (PSEEC), which requires states and municipalities to collectively bargain with public safety officers, also invoked the Commerce Clause as providing the federal authority to regulate state employment.

The Supreme Court has determined for Congress to regulate state and local activity under the Commerce Clause the local activity must be economic and “must substantially affect interstate commerce.”

A 2008 Boston College Law Review article examined whether Congress had authority under the Commerce Clause to regulate state labor relations of public safety officers (the PSFNA also regulates public safety officer employment). It concluded the constitution likely does not permit such regulation because public safety officers do not substantially affect interstate commerce and public employment is not considered economic activity:

[P]ublic safety employment does not seem to satisfy the Supreme Court’s understanding of an “economic activity.” Police work, firefighting, and emergency medical services are not economic enterprises or activities arising out of commercial transactions but are public services provided by states and localities to their citizens. Furthermore, in imposing a collective bargaining requirement on states, the PSEEC Act would not be regulating the production, distribution, or consumption of any commodity for which there is an interstate market.

The PSFNA Imposes an Unfunded Mandate

The PSFNA imposes a large unfunded mandate on states that do not meet the federal collective bargaining requirements. Several provisions in the bill impose an “enforceable duty” upon state and local governments, for which the bill does not provide funding.

Such requirements are considered unfunded mandates under the Unfunded Mandate Reform Act of 1995 (UMRA), under four criteria.

First, the PSFNA would preempt state governments from regulating collective bargaining of its workforce and comply with FLRA mandates.

Second, some states do not require public employers to recognize and bargain with labor unions. These states would incur costs to set up administrative structures to facilitate collective bargaining.

Third, state and local governments would be required to provide testimony or documents, if subpoenaed, by the FLRA.

Fourth, requiring a union monopoly over bargaining raises costs. A state or local employer would be required to pay a union wages instead of hiring a workers who would perform the same job at a lesser expense.

Legislation like the PSNFA is why the UMRA was enacted. It was designed to curtail the federal government from imposing unfunded mandates on state and local governments. A federal mandate on a state or local government is considered unfunded when the legislation does not provide “new budget authority” or “the actual costs of the mandate will not exceed the appropriations actually provided.” The PSFNA does not provide any funding to state or local governments for the collective bargaining mandates.

Without any funding to states, under the UMRA, a House or Senate member can require the Congressional Budget Office “to identify and estimate costs of any unfunded mandates. That includes bills proposed by Congress and regulations promulgated by federal agencies.”

In 2017, any legislation that imposes costs on state and local government over $78 million (this threshold is adjusted annually for inflation) allows a member of Congress to raise a point of order to stop the legislation from proceeding. This is a parliamentary maneuver whereby a member raises an objection on the floor of the legislative body to question an action that is contrary to the rules of the chamber.