Monday, August 13, 2018

Is The Janus Ruling Retroactive?

The Supreme Court recently held that an Illinois agency fee statute which mandated that non-union members pay an amount equivalent to union dues violated the First Amendment. Janus v. AFSCME, 585 U.S. ___(June 27, 2018).  Query whether this case is retroactive, i.e., can agency fee payers seek to collect fees they previously paid? The Court did not discuss this issue.

The Supreme Court has, however, repeatedly recognized:
Elementary considerations of fairness dictate that individuals
should have an opportunity to know what the law is and
to conform their conduct accordingly; settled expectations
should not be lightly disrupted. For that reason, the principle
that the legal effect of conduct should ordinarily be
assessed under the law that existed when the conduct took
place has timeless and universal appeal.  Landgraf v. USI Fim Prods.511 U.S. 244, 265-266 (1994), quoting, Kaiser Aluminum and Chemical Corp. v. Bonjorno, 494 U.S. 827, 855 (Scalia, concurring).
There are also, however, decisions that have been found to be retroactive. See, Kay, Retroactivity and Prospectivity of Judgements in American Law, 62 Am. J. Comp. L. 37 (2014) (discussing case law). 

I was recently interviewed by the Washington Times about the issue and was quoted as explaining:

“In my view, it’s very unlikely that there will be any retroactivity with respect to this decision, and the reason for that is the Janus decision overruled 41-year-old precedent,” said Mitchell Rubinstein, a New York-based lawyer. “It changed existing law.”  Alex Swoyer, In Wake of Supreme Court's anti-union ruling, non-members seek repayment of dues, Washington Times, August 12, 2018.

If the ruling is retroactive then how far back can courts go? The answer is that it depends on the applicable statute of limitations. Most of these cases are brought as 42 U.S.C. 1983 lawsuits which, in states such as New York, have a 3 year statute of limitations.

A finding of retroactivity can be devasting to some unions. That is why it is likely that most unions will seek to avoid litigation and settle cases involving individual union members or involving small numbers of employees. Class action lawsuits, however, may be a different story and only time can tell what will ultimately happen.


Thursday, June 28, 2018

Janus Presents Opportunities For Private Attorneys To Participate In Union Proceedings

On June 27, 2018, the Supremes held in Janus v. AFSCME, 585 U.S. ___(June 27, 2018), that agency fee statutes violated the First Amendment. Some 22 states, including NYS, have agency fee legislation which requires public employees to pay a fee instead of union dues if they do not want to join a union. Those individuals can also object to paying a portion of the agency fee that was unrelated to collective bargaining. That was the rule established in Abood v. Detroit Bd. of Education, 431 U.S. 209 (1977) that Janus overruled.

Very significantly, in response to the argument that agency fee statutes were necessary to prevent the free rider problem (i.e., non-union members receiving union services for free), the Court stated at page 17:

"In any event, whatever unwanted burden is imposed by the representation of nonmembers in disciplinary matters can be eliminated through means significantly less restrictive of associational freedoms than the imposition of agency fees. Individual nonmembers could be required to pay for that service or could be denied union representation altogether.  Thus, agency fees cannot be sustained on the ground that unions would otherwise be unwilling to represent nonmembers." (emphasis added)(citations omitted).

In anticipation of this decision, New York recently amended the Taylor Law to provide that unions do NOT have a duty to represent non-members in disciplinary proceedings or in investigatory interviews. Specifically, the Taylor Law now provides:


Notwithstanding any law, rule or regulation to the contrary, an employee organization’s duty of fair representation to a public employee it represents but who is not a member of the employee organization shall be limited to the negotiation or enforcement of the terms of an agreement with the public employer. No provision of this article shall be construed to require an employee organization to provide representation to a non-member(i) during questioning by the employer,(ii) in statutory or administrative proceedings or to enforce statutory or regulatory rights, or(iii) in any stage of a grievance, arbitration or other contractual process concerning the evaluation or discipline of a public employee where the non-member is permitted to proceed without the employee organization and be represented by his or her own advocate.Nor shall any provision of this article prohibit an employee organization from providing legal, economic or job-related services or benefits beyond those provided in the agreement with a public employer only to its members.

Therefore, this decision may open up many opportunities for private attorneys to represent union members in proceedings which formerly were the sole province of union attorneys.

Update July 2, 2018. NEA predicts a 14% membership decline over the next 2 years. Personally, I think that number will be about double.

Thursday, June 7, 2018

2d Circuit Holds Union Speech Can Be Protected By The First Amendment

Montero v. City of Yonkers, ___F.3d___(2d Cir. May 16, 2018), is an important First Amendment decision. http://www.ca2.uscourts.gov/decisions The Court held that certain speech made at a union meeting can be protected by the First Amendment. The Court did not go as far as several other circuits which held that speech made at a union meetings is per se speech made by a private citizen. Specifically, the 2d Circuit stated:
While we therefore decline to decide categorically that when a person
speaks in his capacity as a union member, he speaks as a private citizen, we conclude that, under the facts of this case as set out in the amended complaint, when Montero spoke in his capacity as a union member, he spoke as a private citizen. This was because, taking the amended complaintʹs allegations as true, Montero spoke in his role as a union officer, and his union speech was not composed of statements made as a ʺmeans to fulfillʺ or ʺundertaken in the course of performingʺ his responsibilities as a police officer. Weintraub, 593 F.3d at 203 (quotation marks omitted). Consequently, he engaged in citizen speech for purposes of the First Amendment.
This decision is lengthly and it spans about 45 pages. The decision reviews the history of First Amendment jurisprudence in this Circuit and is a primer on First Amendment protections for public employees or the lack thereof which readers should be aware of.

Monday, May 21, 2018

Supremes Uphold Class Action Waivers

On May 21, 2018, the Supreme Court issued its long-awaited decision in Epic Systems v. Lewis, ___U.S.___(May 21, 2018). The issue in the case was simple. The Plaintiff signed an arbitration agreement which stated that he waived the right to bring a class action case. He sought to bring a class and collective action under the FLSA for unpaid overtime. In a 5-4 decision, the Court upheld the validity of class action waivers.

Plaintiff's major claim was the the class action waiver interfered with his right to engage in concerted activity under the NLRA. The Supremes rejected that argument and stated:
A close look at the employees’ best evidence of a potential conflict turns out to reveal no conflict at all. The employees direct our attention to the term “other concerted activities for the purpose of . . . other mutual aid orprotection.” This catchall term, they say, can be read toinclude class and collective legal actions. But the term appears at the end of a detailed list of activities speaking of “self-organization,” “form[ing], join[ing], or assist[ing] labor organizations,” and “bargain[ing] collectively.” 29
U. S. C. §157. And where, as here, a more general term follows more specific terms in a list, the general term is usually understood to “‘embrace only objects similar in nature to those objects enumerated by the preceding specific words.’” Circuit City Stores, Inc. v. Adams, 532 U. S. 105, 115 (2001) (discussing ejusdem generis canon); National Assn. of Mfrs. v. Department of Defense, 583 U. S. ___, ___ (2018) (slip op., at 10). All of which suggests that the term “other concerted activities” should, like the terms that precede it, serve to protect things employees “just do” for themselves in the course of exercising their right to free association in the workplace, rather than “the highlyregulated, courtroom-bound ‘activities’ of class and jointlitigation.” Alternative Entertainment, 858 F. 3d, at 414– 415 (Sutton, J., concurring in part and dissenting in part)(emphasis deleted). None of the preceding and more specific terms speaks to the procedures judges or arbitratorsmust apply in disputes that leave the workplace and enter the courtroom or arbitral forum, and there is no textually sound reason to suppose the final catchall term shouldbear such a radically different object than all its predecessors.
Query, whether this language will limit the protections non-union employees, have under the NLRA to engage in concerted activity for mutual aid and protection.

Monday, April 23, 2018

2d Circuit Reviews Manifest Disregard of the Law Standard in Labor Arbitration

Chelsea v. N.Y. Hotel and Motel Trades Council, ____F.3d____(2d Cir. April 3, 2018), is brought to readers attention because it is a recent Second Circuit decision which, once again, demonstrates how difficult it is to vacate a labor arbitrator's decision. The court notes that there is a strong presumption that an arbitrator has not acted in manifest disregard of the law and it will uphold the decision under review so long as there is at least a slightly colorable basis. The court goes on the describe the manifest disregard standard as follows:

An arbitral decision rendered under the Labor
Management Relations Act (“LMRA”) may be vacated if the
arbitrator has exhibited a “manifest disregard of law.”
Westerbeke Corp. v. Daihatsu Motor Co., 304 F.3d 200, 208
(2d Cir. 2002) (internal quotation marks omitted).
Judicial inquiry under the “manifest disregard” standard is
“extremely limited.” Merrill Lynch, Pierce, Fenner &
Smith, Inc. v. Bobker, 808 F.2d 930, 934 (2d Cir. 1986);
see also Burns Int’l. Sec. Servs., Inc. v. Int’l Union,
United Plant Guard Workers of Am., 47 F.3d 14, 17 (2d Cir.
1995). To establish manifest disregard, Chelsea Grand must
show the arbitrator made “something beyond and different
from a mere error in the law or failure on the part of the
arbitrators to understand or apply the law.” Saxis S.S.
Co. v. Multifacs Int’l Traders, Inc., 375 F.2d 577, 582 (2d
Cir. 1967) (internal quotation marks omitted).
An arbitrator commits manifest disregard of the law
when the “governing law alleged to have been ignored by the
arbitrators [was] well defined, explicit, and clearly
applicable,” and the arbitrator “appreciate[d] the
existence of a clearly governing legal principle but
decide[d] to ignore or pay no attention to it.” Westerbeke
Corp., 304 F.3d at 209 (first alteration in original)
(quoting Merrill Lynch, 808 F.2d at 934); see also N.Y.
Tel. Co. v. Commc’ns Workers of Am. Local 1100, 256 F.3d
89, 91 (2d Cir. 2001) (per curiam). The rule ignored by
the arbitrator must be “obvious and capable of being
readily and instantly perceived by the average person
qualified to serve as an arbitrator.” Merrill Lynch, 808
F.2d at 933.

Monday, April 16, 2018

Governor Signs Into Law Major Legislation Narrowing A Unions Duty of Fair Representation

On April 12, 2018, Governor Cuomo signed Chapter 59 of the Laws of 2018 into law which amends the Taylor to narrow a public sector unions duty of fair representation. The amended statute now provides (the underlined portion represents the amendment):

  Improper  employee organization practices. It shall be an improper
   practice for an employee organization or its agents deliberately (a)  to
   interfere  with,  restrain or coerce public employees in the exercise of
   the rights granted in section two hundred two, or to cause,  or  attempt
   to cause, a public employer to do so provided, however, that an employee
   organization  does not interfere with, restrain or coerce public employ-
   ees when it limits its services to and representation of non-members  in
   accordance with this subdivision; (b) to refuse to negotiate collective-
   ly  in good faith with a public employer, provided it is the duly recog-
   nized or certified representative of the employees of such employer;  or
   (c)  to breach its duty of fair representation to public employees under
   this article. Notwithstanding any law, rule or regulation to the contra-
   ry, an employee organization's duty of fair representation to  a  public
   employee it represents but who is not a member of the employee organiza-
   tion  shall be limited to the negotiation or enforcement of the terms of
   an agreement with the public employer.  No  provision  of  this  article
   shall be construed to require an employee organization to provide repre-
   sentation  to  a non-member (i) during questioning by the employer, (ii)
   in statutory or administrative proceedings or to  enforce  statutory  or
   regulatory  rights, or (iii) in any stage of a grievance, arbitration or
   other contractual process concerning the evaluation or discipline  of  a
   public employee where the non-member is permitted to proceed without the
   employee organization and be represented by his or her own advocate. Nor
   shall  any  provision  of this article prohibit an employee organization
   from providing legal,  economic  or  job-related  services  or  benefits
   beyond  those  provided  in the agreement with a public employer only to
   its members.

This statute was reportedly enacted in anticipation of the U.S. Supreme Court's decision in Janus which may ultimately hold that it is a violation of the First Amendment for states (such as New York) to mandate that employees pay "agency fees" if they chose not to become union members. The Governor signed this statute into law at UFT headquarters, here, and reportedly stated that this statute “is the first step of the resistance.”


Friday, April 6, 2018

Supremes Refuse To Interpret FLSA Exemptions In A Narrow Fashion

On April 3, 2018, the US Supreme Court decided Encino Motorcars v. Navarro  and decided 5-4, that FLSA exempts a service adviser at a car dealership from its overtime protections under the exemption for “any salesman . . . primarily engaged in . . . servicing automobiles.” 29 U.S.C. § 213(b)(10)(A).

But, the Court, in dicta went way beyond deciding this case and stated that the FLSA exemptions should not be narrowly construed. As the Court explained:
Because the FLSA gives no “textual indication” that its exemptions should be construed narrowly, “there is no reason to give [them] anything other than a fair (rather than a ‘narrow’) interpretation.” Scalia, Reading Law, at 363. The narrow construction principle relies on the flawed premise that the FLSA “‘pursues’” its remedial purpose “‘at all costs.’” American Express Co. v. Italian Colors Restaurant, 570 U. S. 228, 234 (2013) (quoting Rodriguez v. United States, 480 U. S. 522, 525-526 (1987) (per curiam)); see also Henson v. Santander Consumer USA Inc., 582 U. S. ___, ___ (2017) (slip op., at 9) (“[I]t is quite mistaken to assume . . . that whatever might appear to further the statute’s primary objective must be the law” (internal quotation marks and alterations omitted)). But the FLSA has over two dozen exemptions in § 213(b) alone, including the one at issue here. Those exemptions are as much a part of the FLSA’s purpose as the overtime-pay requirement. See id., at ___ (slip op., at 9) (“Legislation is, after all, the art of compromise, the limitations expressed in statutory terms often the price of passage”). We thus have no license to give the exemption anything but a fair reading.
This dicta would appear to apply to all of the FLSA exemptions and has the potential to result in a finding that many more employees, such as professionals, administrators, and executives, are exempt, and therefore, not entitled to over-time. 

Query whether courts will follow Justice Thomas' reasoning when deciding over-time cases under state law (as opposed to federal law).

Mitchell Rubinstein

Thursday, March 29, 2018

Challenge to NYS Tenure Survives a Motion to Dismiss

In Davids v. State, ____A.D. 3d____ (1st Dep't. March 28, 2018), Plaintiffs in this consolidated appeal brought an action claiming that the various tenure statutes violate the NYS Consitution Education Article which guarantees students the right to a "sound basic education." The Appellate Division affirmed the lower court decision which refused to dismiss the case. As the court explained:
The Education Article requires the Legislature to provide for the maintenance and support of a system of free common schools, wherein all the children of this state may be educated'" ... "[S]tudents have a constitutional right to a sound basic education'" (Paynter v State of New York, ..."[A] sound basic education consists of the basic literacy, calculating, and verbal skills necessary to enable children to eventually function productively as civic participants capable of voting and serving on a jury'" (Paynter ..." Fundamentally, an Education Article claim requires two elements: the deprivation of a sound basic education, and causes attributable to the State'" (Aristy...
Here, the Davids plaintiffs allege in their complaint that teachers are a key determinant of the quality of education students receive and have a profound impact on students' lifetime achievement. The Davids plaintiffs allege that students taught by ineffective teachers—those in approximately the bottom five percent of teachers in New York—suffer lifelong problems and fail to recover from this marked disadvantage.
The Davids plaintiffs allege that the statutory scheme which controls the dismissal of teachers in New York and a seniority-based layoff system make it nearly impossible for school administrators to dismiss ineffective teachers. Specifically, the Davids plaintiffs allege that the following statutes pertaining to the dismissal of teachers deprive students of a sound basic education: Education Law §§ 1102(3), 2509, 2573, 2590-j, 3012, 3014, and 3020-a (hereinafter collectively the Dismissal Statutes). They further allege that Education Law § 3013(2), which mandates that teachers with the least seniority be laid off first (i.e., "last in first out"; hereinafter the LIFO Statute), also deprives students of a sound basic education.
The Davids plaintiffs allege that because of the Dismissal Statutes, school administrators are compelled to either leave ineffective teachers in place or transfer them from school to school. This statutory scheme, they allege, inevitably presents a fatal conflict with the right to a sound basic education guaranteed by article XI, § 1 of the NY Constitution because it forces certain New York students to be educated by ineffective teachers who fail to provide such students with the basic tools necessary to compete in the economic marketplace and participate in a democratic society.
----------------------
This is a very important decision to watch. I predict the Court of Appeals will grant leave to decide this case and it will ultimately reverse this decision. This is what has happened in other states. see, Vergara v. California Teachers Assoc., ___P.3d___(Ct. App. 2016). See also, Forslund v. State, 2017 Minn. App. Unpub. Lexis 789 (Minn. Ct. of Appeals 2017)(dismissing challenge to state tenure statute). On the other hand, should Plaintiffs prevail in the Court of Appeals (survive the Motion to Dismiss) and ultimately win at trial, this case has to potential to change tenure as we know it.

Is The Janus Ruling Retroactive?

The Supreme Court recently held that an Illinois agency fee statute which mandated that non-union members pay an amount equivalent to union ...