Marshall H. Tanick

Minnesota working men and women and just about everyone else will join Monday in celebrating Labor Day. The event dates back to its unofficial origins the 1880s and has been a national holiday since 1894, marking the unofficial end of summer.

While summer is coming to an end, labor union activity is simmering. Unions comprised close to 40% of the workforce in the heyday of the labor movement after World War II. It has shrunk dramatically since then for a number of well-known reasons.

Twenty years ago, about 20% of the workforce was unionized. The figure is about 10.3% currently, representing about 14.3 million workers. Of that amount, nearly two-thirds are in public sector positions, while the rest work in the private sector. About a third of all public sector employees are unionized, but barely 6% of private-sector workers are in a union.

Despite their shrinking numbers, labor unions are fighting back, gaining footholds in the service industry, including some hard-fought election battles at particular Starbucks and Amazon facilities. Those victories were offset by losses at other sites of those companies and a number of other companies as well. In Minnesota, going against the grain, labor union membership has risen to its highest level in 14 years, reaching 16% of the workforce, an increase of about 15% in the last three years.

The waxing and waning of labor movements in the workplace is paralleled by the varying results in recent appellate cases in Minnesota, with labor unions winning a trio of them before panels of the 8th U.S. Circuit Court of Appeals but losing one there, while suffering setbacks in two others in the Minnesota Court of Appeals.

Win or lose, labor unions keep fighting, making more comebacks than Cher, without the feathers and tassels.

Labor Day provides an opportune occasion to review this quartet of cases and what they portend for the travails and gains of the labor movement in this country, as well as in Minnesota, where labor unions represent close to one-sixth of the work force.

Refunds rejected

Unions representing public sector employees prevailed in a major pair of related cases before the 8th U.S. Circuit Court of Appeals, fending off demands for retroactive refunds of union dues stemming from the decision of the Supreme Court four years ago. That ruling allowed employees who declined membership in unions to refuse, on First Amendment freedom of expression grounds, to pay “fair share” dues. But in Hoekman v. Education Minnesota, 41 F. 4th 969(8th Cir. 2022), and Brown v. AFSCME Council No. 5, 41 F. 4th 963 (8th Cir. 2022), the 8th Circuit this summer rejected claims for refunds by objecting nonmembers.

The refund seekers brought the lawsuits on the heels of the Supreme Court decision in Janus v. AFSCME, 138 S. Ct. 2448 (2018), in which the justices, in a decision authored by Justice Samuel Alito, overturned a 41-year-old precedent requiring them to pay dues in Abood v. Detroit Board of Education, 431 U.S. 239 (1977), on grounds that the prior ruling was “wrongly decided.”

Sound familiar? It’s the identical dismissive reasoning the same precedent-shattering jurist used in the Dobbs v. Jackson Women’s Health Organization, 142 S.Ct. 2228 (2022) this summer in overruling the 49-year-old constitutional right to abortion in Roe v. Wade, 410 U. S. 113 (1973) as “egregiously wrong.”

But the 8th Circuit Panel, which included Judge James Loken of Minnesota, refused to permit refunds of past dues paid by the non-union employees, upholding rulings of U. S. District Court Judge Susan Richard Nelson in Minnesota in both cases.

In the Hoekman case, a trio of public school teachers in the Twin Cities metropolitan area brought a class action on behalf of 5,700 colleagues against three local and three statewide unions, which the panel held were not obligated to return the fees because they acted in “subjective good faith” in collecting them prior to the Janus decision. A claim under the federal Civil Rights Act, 42 U.S.C. § 1983, failed because the unions are “private” parties, not “state actors” and carried out “private decisions and policies” regarding dues collection, which were “objectively reasonable.”

Similar reasoning was utilized by the same threesome of judges in the Brown case, brought by state employees against their unions. Their refund claims were likewise barred because there was no subjective “bad faith” engaged in by the unions.

The two decisions are consistent with developing case law in post-Janus litigation based on harsh language in Justice Alito’s decision deeming the collection of “fair share” dues to constitute a “windfall” for unions and an “unconstitutional exaction” if money “taken from” nonmembers.

But the last word is not in on these cases or the underlying theory propelling them, and further appeals to the Supreme Court are likely, where Justice Alito and his super-majority colleagues may be pining for the opportunity to allow objecting employees to tap into funds of unions that cover their workplaces.

“The American labor movement has consistently demonstrated its devotion to the public interest. It is, and has been, good for all Americans.”

President John F. Kennedy

“Only a fool would try to deprive working men and women of their right to join the union of their choice.”

President Dwight D. Eisenhower

Unfairness ruling upheld

A determination by the National Labor Relations Board (NLRB) that an employer engaged in unfair labor practices in violation of the federal labor law was upheld by the 8th Circuit in NLRB v. Noah’s Ark Processors, LLC, 31 F.4th 1097 (April 22, 2022). The board, which oversees management-labor relations in the private sector, found that after a labor contract had expired, the employer failed to negotiate in good faith for a successor labor contract, withheld vital bargaining information, and unilaterally implemented new terms and conditions of employment.

The 8th Circuit panel affirmed that determination in a decision written by Judge Loken. The court held that the employer operating meat processing plants in Nebraska, did not abide by federal labor law after its five-year collective bargaining agreement with the union representing close to 500 meatpacking employees expired. Judge Loken, who was joined on the panel by another Minnesota jurist, David Stras, reasoned that the employer’s actions violated the union’s rights under the National Labor Relations Act, 29 U.S.C. § 158(a)(1) and (5). The board properly imposed severe sanctions on the employer, including reinstatement of terminated staff, required reading to employees of the board’s determination of impropriety, and ordered reimbursing the union’s negotiation expenses. Those remedies, the 8th Circuit panel felt, were appropriate because “substantial evidence“ reflected that a number of employees were fired after they raised questions about some workplace issues, which constituted a “protected concerted work stoppage,” rather than an abandonment of their jobs.

Work stoppages engaged in by the employees were permissible even without the union’s prior authorization and constituted protected activity under the act. Therefore, the firing of these workers constituted an unfair labor practice by the employer,whose intransigence throughout the negotiation process warranted the employees’ conduct. The board properly exercised its “broad discretionary power … to devise remedies to effectuate the policies” underlying federal labor law and did not “abuse its substantial discretion or exceed its remedial authority by imposing these extraordinary remedies,” an issue that Judge Stras, in concurring, felt did not have to be addressed at all, because the employer did not challenge the “notice-reading and reimbursement remedies” in the administrative proceedings before the board.

But a labor union suffered a setback in another ruling written by Judge Loken in International Association of Sheetmetal, Air, Rail and Transportation Workers. v. Iowa Northern Railway Co., 37 F.4th 1399 (8th Cir. June 24, 2022). The case arose under the counterpart statute governing the transportation industry, the Railway Labor Act, 45 U. S. C. § 152. The employer railroad proposed pay cuts as the bargaining agreement was about to expire, but the union did not respond, leading the employer to engage in “self-help,” unilaterally imposing salary reductions and elimination of automatic union dues withholding.

The union’s effort to enjoin the changes was rebuffed by the trial court, and the appellate court affirmed. Reconciling the union’s desire for “[m]aintaining the status quo” and the general proscription of injunctions in management-labor disputes under the Norris-LaGuardia Act, 45 U. S. C. § 152, the appellate panel concluded that the union’s “prolonged foot-dragging and refusal to respond” to the railway’s overture negated the propriety of injunctive relief. Accordingly, the lower court’s denial of an injunction did not constitute an “error or abuse of discretion.”

Minnesota matters

Labor unions did not fare well in a pair of Minnesota appellate court rulings. An arbitration clause in a collective bargaining agreement between sheriff’s deputies and Ramsey County was fatal to a lawsuit brought by one of the deputies. In Shaver v. Ramsey County, 2022 WL 1616625 (Minn. Ct. App. May 23, 2022)(unpublished), the deputychallenged the county’s failure to comply with a provision requiring that “matching” retirement benefits to the employer’s deferred compensation fund be paid directly to the account, rather than remitted to the employees through payroll.

The case, which was brought as a putative class action alleged that the county breached its fiduciary duties and the contract by not making the matching payments to the deferred compensation account of the employees, instead of directly in their paychecks.

The Ramsey County District Court denied a motion to dismiss, but the appellate court reversed in a decision written by Judge Peter Reyes, who reasoned that the lawsuit was barred by the arbitration clause in the union’s collective bargaining agreement with the county. The case should have been dismissed for lack of subject matter jurisdiction because the claims are covered by the arbitration agreement as a “controversy … subject to an agreement to arbitrate” under the grievant’s arbitration clause in the labor union agreement. It is “clear from the complaint that the case involves a dispute or disagreement as to the interpretation or application” of the matching provision in the contract and, therefore, the case does “fall within the scope of the [contract] grievance procedure [which] must go through that process … before the district court can exercise jurisdiction.”

The county argued that the “public policy” underlying the Public Employment Labor Relations Act (PELRA), Minn. Stat. § 179A.01, et seq., under which the lawsuit was brought dictates that the arbitrator should decide arbitrability, that tenet was inapplicable in this case because the “plain language” of the Uniform Arbitration Act, Minn. Stat. § 572.01, et seq., is “unambiguous” in requiring arbitration of this dispute.

Unionized official court reporters employed by the Minnesota Judicial Branch lost their effort to obtain injunctive relief regarding a dispute over how they are paid for preparing court transcripts in Teamsters Local 320 v. Minnesota Judicial Branch, 2022 WL 1298127 (Minn. Ct. App. May 2, 2022)(unpublished). The issue concerned the policy established by the Minnesota Judicial Council that for a one-year experimental period, required transcripts produced by court reporters to be done without charge, when ordered by a judge for “indigent litigants in civil proceedings.” The pilot project, adopted by Chief Justice Lori Gildea, was objected to by the union representing court reporters on grounds that it constituted a change in the terms and conditions of the court reporters employment that should be subject to mandatory collective bargaining, rather than unilaterally imposed without the union’s input, since under previous agreement, there was a per page fee charged for the transcript.

The Ramsey County District Court refused to grant a temporary restraining order or temporary injunction, which the union appealed. But the appellate court rejected its contention, holding that the lower court “had not abused its discretion,” and the trial judge who denied injunctive relief was “not biased.”

The denial of an injunction was appropriate because the union’s argument “misses the mark” contending that there were inconsistent provisions in the statute governing issuance of injunctions and labor disputes, Minn. Stat. § 185.13 (a) and the unfair labor practice provision under PELRA, Minn. Stat. § 179A.13. Because the two statutes do not contradict each other, the trial court “properly considered the factors” in § 185.13 (a) in refusing to grant injunctive relief, which codifies the general injunctive standards for relief under Dahlberg Bros. v. Ford Motor Co., 137 N.W.2d 314 (Minn. 1965).

The trial court’s denial of relief here was properly based upon the determination that the union would “not suffer irreparable harm” without injunctive relief and, furthermore, that it is “not likely to succeed on the merits of its claims.” There was “no irreparable harm because the temporary loss of income was an amount that was calculable” and, therefore, “clearly can be remedied” by awarding compensation if the union ultimately succeeds on the merits, rather than injunctive relief at this stage of the case. Nor was the union’s argument that the employer’s refusal to “bargain over this discreet issue” cause “irreparable harm to the collective bargaining relationship.” The court’s analysis of the five Dahlberg factors accurately weighed those considerations, including the absence of irreparable relief [which] is necessary to warrant issuing temporary injunctive relief.

The union’s argument that the trial judge was biased also was rebuffed because it was not properly raised in the lower court proceedings and, furthermore, “was largely rendered moot” because the case had been reassigned to a different judge.

This sextet of cases — a pair favorable to unions and three against them — reflects the variations of labor law litigation and the conflicting results they have encountered.

PERSPECTIVES POINTERS

Percentage of unionized work force