Union Subsidy Eliminates So-Called “Free Rider” Problem

On January 11, the U.S. Supreme Court will hear oral arguments in Friedrichs v. California Teachers Association, a case that could provide right to work protections to state and municipal employees across the nation—meaning public employees cannot be required to pay dues to a union or risk being fired.

At issue is whether government employee unions should be to compel non-members to pay “agency fees,” which cover the costs of collective bargaining, as a condition of employment, in lieu of dues. The current forced dues precedent was established under the 1977 Supreme Court case, Abood v. Detroit Board of Education.    

This case is all about worker freedom. No worker should have to pay money to any organization in order to keep his or her job—especially inherently political organizations like government unions.

It is also about the rights of voters and taxpayers. Many outcomes of collective bargaining should up to elected officials. Negotiations between unions and state and local government officials should not determine whether public funds go toward contributing to public employee pensions, other municipal needs, or necessitate the raising of additional funds. Those decisions should be left exclusively to elected officials, not private organizations like government unions.

Further, a large number of public employees who are forced to pay dues never had a chance to vote on whether they desired union representation in the first place. Research finds that most public employees never voted for the union that represents them and collects dues from them. As Heritage Foundation labor policy analyst James Sherk notes, “Fully 99 percent of the teachers in Florida’s largest school districts had no choice about being represented by their union.”

Labor unions contend that they need to collect agency fees because non-members still benefit from collective bargaining, contract administration, and grievance procedures. Therefore, union officials claim that if they were not allowed to compel non-members to pay agency fees, those workers would be “free riders” who benefit from union representation.

This is a bogus argument for two reasons.

First, unions can negotiate contracts to represent only members. Many state and local laws allow unions to negotiate these kinds of contracts, but unions want exclusive rights to public employees’ paychecks and the ability to force all of them to pay. As Larry Sand, a former classroom teacher, notes, “California’s Rodda Act allows for exclusive representation and it’s up to each school district and its local union whether or not they want to roll that way.”

Second, a vast majority of state and local governments grant government unions what is known as “release time,” which is a subsidy that pays government union officials to participate in collective bargaining, grievance procedure, and other union activities instead of their government job. So in effect, release time goes a long way toward addressing the supposed “free rider” problem.

Government unions profit greatly from release time. My organization, the Competitive Enterprise Institute, has sent out a large number of public record requests to determine how widespread and costly this union subsidy is.

For example, in Texas, employees of the Austin Police, Fire, and Emergency Medical Services departments were granted a cumulative total of more than 27,000 hours of release time in FY 2012 and 2013, costing taxpayers nearly $1 million.

In Kentucky , the City of Louisville paid public employees to act as union representatives for 31,458 hours from 2011 to 2015. In 2014 and 2015, release time cost the taxpayers of Louisville $126,715 and $172,486, respectively.

In Maryland during 2011-2012, nine school districts awarded 974 days of union release time, the equivalent of nearly five and a half school years.

If labor unions’ best argument for forcing non-members to pay union dues is that workers may free ride, maybe they should take a hard look in the mirror and stop free riding off the taxpayer.