Thursday, December 8, 2016

The Sixth Circuit's Hardin County Decision and Its Impact on Local Right-to-Work Ordinances in Illinois

  On November 18, 2016, the United States Court of Appeals for the Sixth Circuit issued its decision in the case of UAW v. Hardin County, Kentucky.  In that case, the Fiscal Court of Hardin County (the County Board), passed a right-to-work ordinance prohibiting any private sector agreement that required an employee to join or remain a member of a union, pay any kind of dues or assessments to the union, or to pay to a charity or other third party any amount equivalent to union dues.  The ordinance also purported to regulate “hiring hall” arrangements – requiring prospective employees to be referred through a union hall – and dues checkoff provisions – allowing employers and unions to agree to deduct union dues from the wages of consenting employees.  In February, 2016, the federal district court that first ruled on the case had determined that all three elements of the ordinance – the “right-to-work” element, the “hiring hall” element, and the “dues checkoff” element – were pre-empted by the National Labor Relations Act and therefore were invalid.  On appeal, the Sixth Circuit affirmed the ruling of the district court as to the hiring hall and dues checkoff elements but reversed that ruling as to the right-to-work element.

  At issue was the scope of Section 14(b) of the National Labor Relations Act, which says:  “Nothing in this Act shall be construed as authorizing the execution or application of agreements requiring membership in a labor organization as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territorial law.”  In other words, states may prohibit compulsory union membership and compulsory payment of union dues, commonly known as “union security agreements”.  But the question before the court in Hardin County was whether the term “state” in Section 14(b) also includes political subdivisions of a state.  The court held that, at least in the context of the facts of the case, Section 14(b) applies to the legislative actions of a political subdivision of a state as well as to the enactments of the state legislature.  Since Section 14(b) applied to the right-to-work element of the Hardin County ordinance, that element was held not to be pre-empted by the National Labor Relations Act and thus was lawful.  The court, however, held that the hiring hall and dues checkoff elements did not fall within the scope of Section 14(b) and were thus pre-empted by the federal law.

  It is quite likely that the Hardin County decision will be appealed to the Supreme Court, perhaps by both sides, since neither side prevailed entirely.  The UAW is likely to argue that political subdivisions of states do not have the same power to enact right-to-work laws as do the states themselves.  And Hardin County may seek a Supreme Court ruling validating its hiring hall and dues checkoff ordinance provisions.  So the battle is far from over.

  In Illinois, there is an on-going debate over the validity of local right-to-work ordinances affecting local employers and employees in the private sector.  Such an ordinance exists in Lincolnshire, Illinois, for example, although the validity of that ordinance has not been tested in court.  Certainly, the Hardin County decision lends support to the validity of the Lincolnshire ordinance, although that decision is not directly controlling in Illinois because Illinois is in the Seventh Circuit, not the Sixth.  But even assuming that the Seventh Circuit were to agree with the Sixth Circuit on local right-to-work ordinances, an open question in Illinois relates to the scope of the enabling authority of a political subdivision in Illinois to enact such an ordinance.  Lincolnshire is a home rule jurisdiction and is thus vested with certain powers not possessed by non-home rule communities.  Of 1,297 municipalities in Illinois, 211 are home rule.  Of 102 counties in Illinois, only one (Cook) is home rule.  Assuming that home rule jurisdictions have the power to enact right-to-work ordinances, is that same power vested in non-home rule jurisdictions?  Even a Supreme Court ruling upholding the Sixth Circuit’s Hardin County decision might not be dispositive of lingering questions as to which Illinois jurisdictions, if any, have the right to pass local ordinances governing union security issues.

  It is important to note that Hardin County relates to the regulation of local union security issues among private employers.  Public employees, such as the employees of the state or local governments, are not affected.  In Illinois, public employees are covered by the Illinois Public Labor Relations Act and the Illinois Educational Labor Relations Act.  These statutes occupy the field and are not subject to modification by local ordinance.  So the Hardin County decision will not affect public sector employers, public sector unions, or public employees in Illinois.