U.S. Supreme Court: Agency Shop Invalid For IHSS Workers

Harris v. Quinn (United States Supreme Case No. 11-681) (Issued 6/30/14)

Today, the United States Supreme Court issued a narrow but very significant decision on the validity of agency shop agreements in the public sector. In a 5-4 ruling, the Court held that:

The First Amendment prohibits the collection of an agency fee from personal assistants in the Rehabilitation Program who do not want to join or support the union. (p. 39)

Background

This decision involved personal care assistants in Illinois. In California, we refer to these individuals as In-Home Supportive Services (IHSS) workers. Under Governor Rod Blagojevich, personal care assistants gained the right to unionize. However, these workers were considered “employees” of the state only for purposes of collective bargaining. For other purposes, the employer was the individual recipient of the services provided by the worker. Under Illinois law, public sector unions are allowed to negotiate “agency fee” agreements whereby all members of the bargaining unit must pay a fee, whether or not the individual worker is a member of the union. A few workers challenged the imposition of the agency fee requirement as unconstitutional. The case ended up in the Supreme Court

The Court’s Decision

In defending the case, the State of Illinois relied heavily on the Supreme Court’s prior decision in Abood v. Detroit Bd. of Ed. (1977) 431 U.S. 209. In Abood, the Court approved applying agency fee provisions to public employees. Here, however, the Court eventually concluded that personal assistants are only “partial-public employees,” and thus held that Abood does not control. But what was very interesting to me—and what must have been disheartening to unions—is how much the majority criticized Abood. The Court stated that the “Abood Court’s analysis is questionable on several grounds” and went on to discuss them at length. I found the following portion of the discussion of Abood very significant:

Abood failed to appreciate the difference between the core union speech involuntarily subsidized by dissenting public-sector employees and the core union speech involuntarily funded by their counterparts in the private sector. In the public sector, core issues such as wages, pensions, and benefits are important political issues, but that is generally not so in the private sector. (p. 17)

I think this quote is significant because it’s very difficult to reconcile this statement with the holding in Abood. Nevertheless, the majority made it clear it was not issuing a broad decision overturning Abood, but a very narrow one distinguishing it.

After criticizing Abood, the Court then discussed all the ways that personal care assistants are different from other public employees. The Court emphasized that these workers are only “employees” of the state for purposes of collective bargaining. The Court emphasized several times that the state is not vicariously liable in tort for the personal care assistant’s acts or omissions. Finally, the Court noted that many of the terms and conditions of employment for these workers fell outside the scope of representation, and thus the union’s role was limited.

Because of the difference between these “partial-public employees” and regular public employees, the Court refused to extend the holding in Abood to this situation. Accordingly, the Court held that these workers could not be compelled to pay an agency fee to the union.

Application to California

From my initial reading of Harris, it’s hard to see any difference between the personal care assistants in Illinois and IHSS workers in California. Interestingly, California recently enacted the In-Home Supportive Services Employer-Employee Relations Act (IHSS-EERA) (Gov. Code, §110000 et. seq). The IHSS-EERA expressly allows for an agency fee provision. (Gov. Code, §110002.) Initially, IHSS-EERA only covers a few counties but the expectation is that it will be expanded over time. PERB is currently in the process of enacting regulations to administer the IHSS-EERA.

Many IHSS workers who are not covered by IHSS-EERA are still subject to collective bargaining. Pursuant to the Welfare and Institutions Code, many counties have set up public authorities or nonprofit consortiums to act as the “employer” for purposes of collective bargaining. These entities are subject to the MMBA. Similar to the facts in Harris, the Welfare and Institutions Code limits the liability of the public authority or nonprofit consortium for the torts of IHSS workers. (Wel. & Inst. Code, §12300.5, subd. (c); 12301.6, subd. (f).) The Welfare and Institutions Code also provides that although the public authority or nonprofit consortium is the “employer” for purposes of collective bargaining, the recipient of the services retains the right to hire, fire, and supervise the work of the IHSS worker. (See Wel. & Inst. Code, §12301.6, subd. (c).) Thus, the key traits of the personal care assistants in Harris appear to be identical to IHSS workers in California.

What to Expect in the Coming Months and Year

Assuming that IHSS workers in California are “partial-public employees” within the meaning of Harris—and I believe that they are—here’s what I see as the impact of this decision:

The agency shop provision in the IHSS-EERA (Gov. Code, §110019) is unconstitutional to the extent it requires any IHSS worker to pay a fee to the union. IHSS workers may voluntarily pay fees or join the union, but cannot be compelled to do that.
PERB may have to revisit its proposed IHSS-EERA regulations to ensure that IHSS workers are not being compelled to pay an agency fee and/or have a mechanism to challenge such a fee.
Similarly, the agency shop provision in the MMBA (Gov. Code, §3502.5) is unconstitutional to the extent it requires any IHSS worker to pay a fee to the union. Unlike IHSS-EERA, the MMBA is administered locally and governed largely by local rules. Counties with IHSS workers, including those with public authorities and nonprofit consortiums, should prepare to begin receiving objections from individual workers to agency fee deductions. Given the potential uncertainties, these entities will want to consult with counsel before deciding how to treat such objections. These entities may also receive a request to invalidate in its entirety a contractual agency fee provision. Again, these entities will want to consult with counsel before deciding how to handle such a request.