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Not bad faith for union to enforce dues revocation requirements; no private right of action under LMRA

By Marjorie Johnson, J.D.

Two former union employees failed to revive a class action lawsuit challenging the union’s refusal to accept their revocation of union dues checkoff authorizations based on their failure to follow the protocol set forth in the original forms. Affirming dismissal of their claims, the Sixth Circuit determined that they could not sue the union for violation of the LMRA since the criminal statute did not create a private right of action, and the union did not breach its duty of fair representation since it did not act arbitrarily or in bad faith (Ohlendorf v. United Food & Commercial Workers International Union, Local 876, February 22, 2018, Sutton, J.).

Checkoff forms provide rules for revoking. The two plaintiffs worked for a grocery store that, pursuant to its collective bargaining agreement with the union, was allowed to deduct union dues from employees’ paychecks if they signed an authorization form. The form provided that the checkoff authorization would be irrevocable for one year or until the termination date of the agreement, whichever occurred sooner, and thereafter for yearly periods, unless revoked by certified mail during a 15-day window each year.

The plaintiffs joined the union and signed the authorization forms, but resigned their membership three years later. They also tried to revoke their permissions, but sent their written revocations by regular mail and outside of the 15-day window. The union refused to accept the revocations for that year and the employer continued to deduct union dues from their wages. Disgruntled, they filed this class action claiming that the union (1) violated the LMRA by imposing conditions on their ability to revoke their authorizations, and (2) violated its duty of fair representation by enforcing those conditions. The district court dismissed their complaint and while their appeal was pending, one successfully revoked her authorization and the other quit.

Injunction claim moot. The plaintiffs sought to enjoin the union from enforcing the window-period and certified-mail requirements. However, because one no longer worked at the store and the other recently revoked her authorization, their bid for the injunction was now moot. Therefore, the appeals court only addressed their request for monetary damages.

No express right of private action. Section 302 of the LMRA makes it a crime for an employer to deduct union dues from an employee’s paycheck and for the union to accept the dues, except if the employee consents by signing an authorization form (a dues checkoff). While the Attorney General has authority to enforce this criminal statute, he did not do so here, and the plaintiffs did not file an unfair labor practice charge with the NLRB. Instead, they sought to enforce this criminal statute.

However, Section 302 does not expressly provide that private parties may enforce the law. Rather, the statute imposes federal criminal penalties on parties who willfully violate the statute (a criminal fine up to $15,000 or imprisonment up to five years). That form of relief is usually enforced by the federal government, not private parties, and the section about “Penalties for violations” says nothing about civil remedies.

No implied right to sue. The LMRA also did not create the “increasingly rare” implied right of action. Congress can only imply a right of action through “clear and unambiguous terms.” Moreover, “rights” differ from the “broader or vaguer ‘benefits’ or ‘interests,’” and “statutes that ban conduct but do not identify specific beneficiaries do not suffice.” With that in mind, the Sixth Circuit provided some examples of “permissible” vs “impermissible” statutes. For example, a statute stating “[n]o person in the United States shall… be subjected to discrimination” based on race creates an individual right to be free from race discrimination. On the other hand, a statute prohibiting the funding of “any educational agency or institution which has a policy or practice of permitting the release of education records” creates no rights at all, even though students might benefit from the statute and might have an interest in enforcing it.

No person-specific rights. Section 302 fell on the “impermissible side of this line” as it did not create person-specific rights but instead focused on the persons being regulated. The law makes it a crime for an employer to willfully give money to a union, and for the union to willfully accept the money, but does not say anything about the individuals protected or their capacity to file a lawsuit. Moreover, Section 302 is “flanked” by other provisions that do expressly establish private rights of action, which indicates that Congress had no trouble providing a private right of action in the LMRA when it wished to do so.

The Sixth Circuit also rejected plaintiffs’ assertion that a private cause of action was created by Section 302(e), which grants jurisdiction to the federal courts “to restrain violations of this section.” This provision only created jurisdiction for the courts to restrain violations of Section 302 at the request of the Attorney General, and to enjoin violations in lawsuits brought under express private rights of action, as a needed exception to the Clayton Act and the Norris-LaGuardia Act’s ban on labor-dispute injunctions. The court also noted that the plaintiffs were not without recourse as they had other options, such as waiting for the Attorney General to prosecute the union for violating Section 302, asking the Attorney General to seek an injunction, or filing a ULP complaint with the NLRB.

NLRA claim also fails. The plaintiffs also failed to revive their claim that the union breached its duty of fair representation since its enforcement of the window-period and certified-mail requirements was not arbitrary or in bad faith. Though the union’s refusal to credit a revocation that was sent too early was “head scratching,” its decision to enforce the requirements was not in bad faith since the plaintiffs did not allege that its decision was misleading or a product of fraud or dishonesty. Indeed, the authorization form they each signed spelled out the requirements they would need to follow to revoke their assignments.