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Wisconsin law restricting collective bargaining by most public employees again found constitutional

By Ronald Miller, J.D.

Reviewing more challenges to the constitutionality of Wisconsin’s Act 10, the Seventh Circuit concluded that even though the unions’ First Amendment and Equal Protection Clause theories were unique to this case, their arguments nevertheless failed to state a constitutional violation. Because Act 10 imposed collective bargaining restrictions only upon government employers, while general employees remained free to act in concert, the appeals court found that it did not run afoul of the Petition Clause. Similarly, the court concluded that the cumulative effect of Act 10 did not violate the unions’ associational rights, since there was no attempt to punish union members or regulate the unions’ internal affairs (Laborers Local 236 v Walker, April 18, 2014, Flaum, J).

Restrictions on public employee bargaining. Wisconsin’s Act 10 made significant changes to Wisconsin public‐sector labor law: it prohibited government employers from collectively bargaining with their general employees over anything except base wages, made it more challenging for general‐employee unions to obtain certification as exclusive bargaining agents, and precluded general‐employee unions from using automatic payroll deductions and fair‐share agreements. The plaintiffs, two public‐employee unions and an individual union member argued that these changes infringe their First Amendment petition and association rights. They also argued that Act 10 denies union members the equal protection of the laws.

Act 10 divided Wisconsin state and municipal employees into two categories: “public safety employees,” including police officers, firefighters and the like; and “general employees,” which included everyone else. Public safety employees, and their unions, continue to enjoy the protections and privileges of Wisconsin’s preexisting scheme. General employees, on the other hand, became subject to Act 10’s various restrictions. To begin with, the Act reduced state and municipal employers’ collective‐bargaining obligations with respect to these employees. Now, public employers are required to collectively bargain with their general employees over base‐wage increases, but nothing else. Act 10 also separately prohibited municipal employers from collectively bargaining with their general employees about non‐wage issues.

Further, Act 10 mandates that general‐employee unions submit to a recertification election every year (instead of allowing unions to remain certified indefinitely). State and municipal employers are also barred from deducting union dues from their general employees’ earnings. Finally, the Act prevented unions from imposing fair‐share agreements on general employees.

Prohibition on payroll deductions valid. Previously, in Wisconsin Education Association Council v Walker (WEAC), the Seventh Circuit held that the Act’s prohibition on payroll deductions did not violate the First Amendment. There, the appeals court found that the unions’ previous use of the payroll system was the equivalent of the state subsidizing the unions’ speech, therefore, Wisconsin was free to withdraw this subsidy from certain groups so long as it did so on a viewpoint‐neutral basis. Moreover, the appeals court concluded that Act 10’s distinction between public safety employees and general employees was viewpoint neutral.

Effect of Act 10 on municipal employees’ collectivebargaining rights. In the present case, the Seventh Circuit noted that the parties had a fundamental disagreement about Act 10’s effect upon municipal employees’ collective‐bargaining rights. Because the appeals court’s Article III jurisdiction over most of the unions’ claims depended on the outcome of this dispute, the court had to settle it before proceeding to the merits.

The unions argued that language in Act 10 (Wis. Stat. Sec. 66.058(1m)) prohibited municipal employers from collectively bargaining with their general employees about anything other than wages, even if the employer wanted to bargain outside the framework of the Municipal Employment Relations Act (MERA). However, the state urged the appeals court to read Sec. 66.058(1m) more narrowly. The state argued that Wis. Stat. Sec. 66.058(1m) merely prohibited statutory collective bargaining for general employees outside of MERA. The court observed that if that is so, then the constitutional “right” the unions think Act 10 infringes is actually untouched by the Act. Most of the unions’ constitutional claims derive from the fact that in their view, Act 10 precludes their employers from even voluntarily bargaining with them.

However, the appeals court found the unions’ interpretation of Sec. 66.058(1m) more plausible. In the absence of an authoritative interpretation from the Wisconsin Supreme Court, the Seventh Circuit interpreted Sec. 66.0508(1m) as it felt the state’s high court would construe it. Therefore, giving effect to Sec. 66.0508(1m)’s plain language, the appeals court interpreted the provision to prohibit municipal employers from reaching binding agreements with their general employees on a collective basis, if the agreement concerns anything other than the employees’ base wages.

First Amendment claim. Having concluded that Act 10 is as sweeping as the unions believed, the Seventh Circuit turned to address the merits of their constitutional claims. The unions made two distinct claims attacking Act 10 under the First Amendment: first, that the collective bargaining prohibition — Sec. 66.0508(1m) — violates their members’ rights to petition the government for redress of grievances, and second, that Act 10’s various restrictions, in their cumulative effect, violate their associational rights.

Petition Clause. As an initial matter, the Seventh Circuit noted that Sec. 66.0508(1m) does not proscribe any conduct by the unions themselves. Instead, its collective bargaining restriction acts upon government employers. The statute tells these employers that they may not enter into binding agreements with their employees on a collective basis about anything other than base wages. Thus, “[u]nder Act 10, general employees remain free to associate and represent employees and their unions remain free to speak; municipal employers are simply not allowed to listen.” Here, the appeals court agreed with the district court that under Supreme Court precedent, such a law is constitutional.

Nevertheless, the unions contended that Wisconsin could not constitutionally deny municipal employers their ability “to choose whether to listen.” However, the Seventh Circuit pointed out that this argument was foreclosed by the Supreme Court’s decision in Minnesota State Board for Community Colleges v Knight. In the instant case, the unions’ complaint is that Act 10 bars Wisconsin public employers from voluntarily entering into binding negotiations with a group of employees. But that was the case in Knight as well. Still, nothing in Wis. Stat. Sec. 66.0508(1m), or Act 10 generally, precluded the unions or their members from expressing their views to their municipal employer or from trying to persuade the employer to adopt a particular policy.

Next, the appeals court rejected the union’s assertion that the ability of municipal employees to engage in the activity of bargaining collectively with their employers is a fundamental right. The court noted several problems with that assertion. First, two of the cases cited by the unions — NLRB v Jones & Laughlin Steel Corp and Amalgamated Utility Workers v Consolidated Edison Co. of New York — involved private employers, so the “right” the court was referring to could not have been constitutional. Second, the relevant discussion in each case stands only for the proposition that individuals have a right to associate together in a union, to discuss matters pertaining to union membership, to select their own representatives, and to attempt to use their collective weight to advocate for change. Thus, the Seventh Circuit concluded that Act 10’s prohibition on collective bargaining did not run afoul of the Petition Clause.

Associational rights. The Seventh Circuit next addressed whether Act 10’s provisions violated the union’s associational rights. Here, the court observed that Act 10 did not punish group membership, interfere in the group’s internal affairs, or distort the group’s message. Nothing in Act 10 prohibited unions from forming, meeting, or organizing. Further, none of Act 10’s provisions disadvantaged employees who choose to join a union. And the statute did not tell unions how to conduct their internal affairs. In short, Act 10 places no limitations on the speech of general employee unions.

Instead, the unions complain that Act 10’s various restrictions and obstacles make it more difficult for them to accomplish what they were formed to do — represent their members’ interests through the collective‐bargaining process. However, the First Amendment does not require the state to maintain policies that allow certain associations to thrive. Thus, the court concluded that the unions could not wield the First Amendment to force the state to continue its previous policies. For this reason, none of Act 10’s proscriptions infringed the unions’ associational rights.

Equal Protection Clause. Finally, the unions argued that Act 10’s collective‐bargaining rules impermissibly disadvantaged “represented employees.” However, the Seventh Circuit again rejected the unions’ characterization of the law. Wisconsin was not treating employees differently based on the employees’ exercise of their associational rights. Rather, the state has refused to participate in an activity that the represented employees want the state to engage in. The association right does not compel public employers to sit down at the table with whomever an employee may wish to represent them.