Union security agreement

A union security agreement is a contractual agreement, usually part of a union collective bargaining agreement, in which an employer and a trade or labor union agree on the extent to which the union may compel employees to join the union, and/or whether the employer will collect dues, fees, and assessments on behalf of the union.[1]

Rationale

The free-rider problem is often cited as the rationale for union security agreements. A classic study of the free rider problem is presented in Mancur Olson's 1965 work, The Logic of Collective Action.[2] In labor relations, the free rider problem exists because the costs of organizing a union and negotiating a contract with the employer can be very high, and because employers will find it too costly to adopt multiple wage and benefit scales, some or all non-union members may find that the contract benefits them as well.[3]

Thus, the incentive is for some individual workers to "ride for free" by not paying the costs, which can lead to the collapse of the union and no collective bargaining agreement.[3] If the union collapses, each worker may be worse off than if the union had negotiated the agreement.[3] Union security agreements are one way of ensuring that all (or nearly all) workers pay their fair share of the costs of collective bargaining (e.g., join the union and pay dues).[3][4]

One solution is for the state to provide rights (such as the right to administer welfare or pension funds, or to participate in a works council) or benefits (such as unemployment insurance) only to unions or their members.[5][6] Another solution is for unions to engage in members-only collective bargaining, which restricts the benefits of the contract to union members.[7][8]

The International Labour Organization's Right to Organise and Collective Bargaining Convention can "in no way be interpreted as authorising or prohibiting union security arrangements, such questions being matters for regulation in accordance with national practice."[9]

Union security agreements are explicitly mentioned in the labor laws of many countries. They are highly regulated by law and court rulings in the United States[1][10] and to a lesser degree in the United Kingdom.[8] In Canada, the legal status of the union security agreement varies from province to province and at the federal level, with a few provinces permitting but not requiring it but the majority of provinces (and the federal government) requiring it if the union requests it.[11]

In most Western European countries, the closed shop (one form of the union security agreement) is typically banned, while other forms typically go unregulated in labor law.[8][12] This is not universal; for example, in Germany both the right to join a union and the right not to join a union are equally protected by law and the courts, and all forms of union security agreements are banned.[6] The law in Belgium has similar provisions.[8] Still, since participation in the unemployment insurance system is compulsory and only unions have the right to administer this system, union membership in Belgium remains high.[5]

Outside North America and Western Europe, the legal status of union security agreements varies even more widely. In New Zealand, as of 1988, the closed shop was compulsory where a union organized the workplace.[13] In the Philippines, various types of union security agreements are permitted under labor law.[14] In Mexico, the closed shop was mandatory until the early 1990s, when a change in federal law permitted the union shop, agency shop, or no agreement at all.[15][16] But because of the political ties between unions and the governing party in Mexico and other ways in which Mexican law favors established unions, the closed shop is essentially still the norm.[16]

Many countries, however, have not addressed the issue of union security agreements. Neither Indonesian nor Thai labor law addresses the issue, and in both countries collective bargaining, union administrative procedures, and dues collection are so weak that the union security issues rarely arise.[17] In Australia, the legal status of union security agreements has varied widely across each state and the national government and over time. Australian labor law does not explicitly regulate union security agreements. However, various forms of the union security agreement have been favored at one time or another by each state, territory, or the national government, effectively regulating the favored type of union security agreement and disadvantaging its other forms.[18]

Types

Various types of union security agreements exist. Among the more common are:

  • Closed shop—The employer agrees to hire only union members. An employee who resigns from the union must be dismissed.[1]
  • Union shop—The employer may hire anyone regardless of their union membership status, but the employee must join the union within a set time period (such as 30 days). An employee who resigns from the union must be dismissed.[1]
  • Agency shop—The employer may hire anyone regardless of their union membership status, and the employee need not join the union. However, all non-union employees must pay a fee (known as the "agency fee") to the union to cover the costs of collective bargaining (and, in some countries, other fees as well). An employee who resigns from the union may not be dismissed but must pay the agency fee.[1]
  • Fair share provision—The employer may hire anyone regardless of their union membership status, and the employee need not join the union. However, all non-union employees must pay a fee (known as the "fair share fee") to the union to cover the costs of collective bargaining. An employee who resigns from the union may not be dismissed but must pay the fair share fee.[1] In public sector collective bargaining, where the agency shop is often outlawed, the fair share provision (almost identical to the agency fee) may be negotiated instead.[19]
  • Dues checkoff—A contract between the employer and union where the employer agrees to collect the dues, fees, assessments, and other monies from union members and/or non-members directly from each worker's paycheck and transmit those funds to the union on a regular basis.[1]

Janus v. AFSCME
Main article: Janus v. AFSCME

Janus v. American Federation of State, County, and Municipal Employees, Council 31, _ US _ (2018) is a US labor law case, concerning whether governments violate the First Amendment when they require their employees to pay fees to a union as a condition of employment.

In February 2015, Illinois Republican Governor Bruce Rauner filed suit, claiming that fair-share agreements are unconstitutional and a violation of the First Amendment right to free speech.

In March 2015, three government workers from Illinois represented by attorneys from the Illinois-based Liberty Justice Center and Virginia-based National Right to Work Legal Defense Foundation took legal action to intervene in the case.[20][21][22] In May 2015, Rauner was dropped from the case, after a federal judge ruled that the governor did not have standing to bring such a suit, but the case proceeded under a new name, Janus v. AFSCME.[23] The case is named after Mark Janus, an Illinois child support specialist covered by a collective bargaining agreement.

Janus claimed that he should not need to pay fees to the American Federation of State, County and Municipal Employees because doing so constitutes paying for political speech with which Janus disagrees.[24] This became permissible after a 1977 decision by the US Supreme Court in Abood v. Detroit Board of Education.

In June 2018, the US Supreme Court ruled in favor of Janus, in a 5–4 decision, and stated that "States and public-sector unions may no longer extract agency fees from nonconsenting employees".[25]

References
  1. Pynes, Joan. Human Resources Management for Public and Nonprofit Organizations. 2d ed. Hoboken, N.J.: John Wiley and Sons, 2004. ISBN 0-7879-7078-6
  2. Olson, Mancur. The Logic of Collective Action: Public Goods and the Theory of Groups. 18th rev. ed. Cambridge, Mass.: Harvard University Press, 1971. ISBN 0-674-53751-3
  3. Towers, Brian. The Representation Gap: Change and Reform in the British and American Workplace. Oxford, England: Oxford University Press, 1997. ISBN 0-19-829319-4; Holley, William H.; Jennings, Kenneth M.; and Wolters, Roger S. The Labor Relations Process. 9th ed. Florence, Ky.: Cengage Learning, 2008. ISBN 0-324-42144-3; Beatty, David M. Putting the Charter to Work: Designing a Constitutional Labour Code. Toronto: McGill-Queen's Press - MQUP, 1987. ISBN 0-7735-0601-2; Bar-Niv, Zvi H. International Labour Law Reports, Volume 8. Leiden, The Netherlands: Martinus Nijhoff Publishers, 1990. ISBN 0-7923-0429-2
  4. Not all scholars agree that a free rider problem exists in labor relations. See: Baird, Charles W. Opportunity or Privilege: Labor Legislation in America. New York: Transaction Publishers, 1984. ISBN 0-912051-02-7
  5. Rothstein, Bo. "Labour-Market Institutions and Working-Class Strength." In Power Resources Theory and the Welfare State: A Critical Approach: Essays Collected in Honour of Walter Korpi. Julia Sila O'Connor and Gregg Matthew Olsen, eds. Toronto: University of Toronto Press, 1998. ISBN 0-8020-7171-6
  6. Daubler, Wolfgang. "The Individual and the Collective: No Problem for German Labor Law?" Comparative Labor Law and Policy Journal. 10:505 (Summer 1989).
  7. Morris, Charles. The Blue Eagle At Work: Reclaiming Democratic Rights In The American Workplace. Ithaca, N.Y.: ILR Press, 2004. ISBN 0-8014-4317-2.
  8. Ulman, Lloyd; Eichengreen, Barry J.; and Dickens, William T. Labor and an Integrated Europe. Washington, D.C.: Brookings Institution Press, 1993. ISBN 0-8157-8681-6
  9. "Case(s) No(s). 188, Report No. 34 (Denmark): Complaints against the Government of Denmark presented by Swiss Printing Workers' Union and the Swiss Federation of National Christian Trade Unions." Archived 2011-06-04 at the Wayback Machine Document No. 031960034188. Cases of the Committee on Freedom of Association. International Labor Organization. March 4, 1959.
  10. Gold, Michael Evan. An Introduction to Labor Law. 2d rev. ed. Ithaca, N.Y.: Cornell University Press, 1998. ISBN 0-8014-8477-4
  11. Bennett, James T. and Kaufman, Bruce E. The Future of Private Sector Unionism in the United States. Armonk, N.Y.: M.E. Sharpe, 2002. ISBN 0-7656-0852-9
  12. Kassalow, Everett M. "The Closed and Union Shop in Western Europe: An American Perspective." Journal of Labor Research. 1:2 (June 1980).
  13. Davidson, Alexander. Two Models of Welfare: The Origins and Development of the Welfare State in Sweden and New Zealand, 1888-1988. Stockholm: Almqvist and Wiksell International, 1989. ISBN 91-554-2486-4
  14. Mendoza, Quintin C. The Philippine Labor Relations Law. Manila, Philippines: Rex Book Store, 2001. ISBN 971-23-0583-X
  15. Befort, Stephen F. and Cornett, Virginia E. "Beyond the Rhetoric of the NAFTA Treaty Debate: A Comparative Analysis of Labor and Employment Law in Mexico and the United States." Comparative Labor Law and Policy Journal. 17:269 (Winter 1996).
  16. LaBotz, Dan. Mask of Democracy: Labor Suppression in Mexico Today. Boston: South End Press, 1992. ISBN 0-89608-437-X
  17. Levine, Marvin J. Worker Rights and Labor Standards in Asia's Four New Tigers: A Comparative Perspective. New York: Springer, 1997. ISBN 0-306-45477-7
  18. Weeks, Phillipa. Trade Union Security Law: A Study of Preference and Compulsory Unionism. Annandale, NSW, Australia: Federation Press, 1995. ISBN 1-86287-167-1
  19. Marczely, Bernadette. Human Resource and Contract Management in the Public School: A Legal Perspective. New York: Rowman & Littlefield, 2002. ISBN 0-8108-4379-X
  20. "State workers in Illinois sue to end mandatory union fees". Illinois Policy. 2015-03-23. Retrieved 2018-06-21.
  21. Ravve, Ruth (2015-04-06). "Unions battle for survival in key strongholds as court cases challenge forced dues". Fox News. Retrieved 2018-06-21.
  22. "3 state employees want to join Rauner lawsuit over 'fair share' union fees". Chicago Sun-Times. Retrieved 2018-06-21.
  23. Pearson, Rick. "Judge drops Rauner 'fair share' suit, lets non-union workers' case proceed". chicagotribune.com. Retrieved 2018-06-21.
  24. https://ljc-assets.s3.amazonaws.com/2016/12/Rauner-v.-AFSCME-120-First-Amended-Complaint-2015.06.01.pdf
  25. https://www.supremecourt.gov/opinions/17pdf/16-1466_2b3j.pdf
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