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Jan 22, 201308:12 AMForward HR

with Diane Hamilton and Nilesh Patel

A closer look at the 7th Circuit Court’s Act 10 ruling

A closer look at the 7th Circuit Court’s Act 10 ruling

(page 1 of 2)

On Jan. 18, the 7th Circuit Court of Appeals ruled on the federal constitutional challenges to 2011 Wisconsin Act 10, the Budget Repair Bill that drastically changed collective bargaining for state and municipal workers in Wisconsin. In a 74-page opinion, the court rejected challenges to three provisions of the law and upheld all of Act 10.

Three provisions challenged

Public sector unions pursued the lawsuit on behalf of state and municipal workers classified as “general employees” under Act 10. These workers faced substantially reduced collective bargaining rights and new restrictions in comparison to “public safety employees,” who were not affected.

The unions claimed an Equal Protection violation in three provisions of Act 10: limitations on the mandatory subjects of bargaining, an annual recertification vote requiring a 51% majority of all union members (rather than a majority of those voting), and a prohibition on deducting union dues from a member’s paycheck. The unions also claimed a First Amendment violation for the paycheck deductions provision.

At the district court level, the unions won the annual recertification and paycheck deductions challenges. However, the appeals court reversed those gains.

Equal protection challenges

Under an Equal Protection challenge, a statute remains valid if it has a reasonable purpose and that purpose is achieved in a rational manner. Any categorization or classification used to create groups is upheld if it bears some rational relationship to a legitimate government end.

This is a highly deferential standard and an uphill battle for a party challenging a statute. The government does not need to actually articulate the law’s purpose or produce evidence that its method is rational. Instead, the law is presumed to be constitutional. The challenger’s burden is to negate every basis or possibility that might support the law, even when that basis is not stated in the record.

Act 10’s purpose is to restrict collective bargaining rights for unionized employees. However, such restrictions were going to be contentious and may have resulted in labor unrest. To minimize fallout in critical areas, Act 10 exempted unions in the public safety category.

The general worker unions could not argue that restricting collective bargaining rights was an unreasonable purpose. Collective bargaining rights are not fundamental rights and the state does not have to provide those rights. Therefore, the unions had to focus on showing an irrational means to achieve the statute’s purpose.

The unions argued the worker classifications are irrational. For example, state motor vehicle inspectors are classified as public safety workers, while prison guards, University of Wisconsin Police, and the State Capitol Police are treated as general employees. Clearly, it is hard to imagine how labor unrest by vehicle inspectors would pose a critical risk when compared to striking prison guards or police. Such flawed sorting could show an illegitimate purpose, such as political favoritism for those unions that supported Scott Walker’s campaign for governor.

Such arguments posed several concerns for the court. First, the court was unwilling to speculate about the Legislature’s motives when the statute, as written, passed the legal standard for an Equal Protection challenge. Second, there is 7th Circuit precedent that allows for political favoritism. In Hearne v. Board of Education, Chicago teachers claimed their job security was reduced in retaliation for opposing Republican candidates. In response, the 7th Circuit stated: “there is no rule whereby legislation that otherwise passes the proper level of scrutiny … becomes constitutionally defective because one of the reasons the legislators voted for it was to punish those who opposed them during the election campaign.” Lastly, the court was unwilling to act as a supra-legislature by evaluating the political wisdom of each classification or expecting that every attempt to include or exclude a group would be precisely correct. That vehicle inspectors are included as public safety workers, while prison guards and other police are not, was not a matter for the court.

Applying the Equal Protection analysis to the challenged provisions, the court ruled:

  1. The state reasonably concluded that excluding public safety workers from Act 10’s changes was the right step to avoid labor unrest in critical public safety functions.
  2. Act 10 reasonably applies the annual recertification requirement only on general worker unions, because the state could still fear labor unrest if a public safety union fails to recertify in the future.
  3. Allowing payroll deductions for only public safety workers was reasonable because of the state’s fear of labor unrest.

The court’s rationale for upholding this provision is not apparent. The court lists the labor unrest following passage of Act 10, and the unions’ statement that removing the payroll deductions would be catastrophic, as supporting reasons. However, the labor protests were in response to Act 10’s overall impact, not specifically because of the payroll deductions. Further, is it reasonable that there could be labor unrest by removing payroll deductions for public safety workers? Perhaps the court did not want to second-guess the state’s concerns. Building on the unions’ comment about the catastrophic impact, perhaps there is an alternative reasonable explanation: it is an administrative burden to maintain payroll deductions and the state only wanted to take on that burden for workers who perform critical functions.

Old to new | New to old
Jan 28, 2013 06:36 am
 Posted by  Anonymous

“Act 10 simply subsidizes the speech of one group, while refraining from doing so for another,” Judge Flaum wrote, referring to public safety workers and general public employees. “Nothing in the Constitution requires the government to subsidize all speech equally.” Its interesting that a judge(for accuracy sake a conservative judge) believes the constitution of a state does not have to be applied equally to all its citizens. SO if the state government wants to pay for one political parties ads that would be okay? That doesn't seem to make sense nor does it seem to follow the spirit of our democracy.

Jan 30, 2013 07:14 pm
 Posted by  Anonymous

This ruling was based on the federal constitution and all three judges on the panel agreed the Equal Protection Clause operates this way, using the rational basis standard.

The one area I know the government cannot play favorites is under the Establishment Clause, where one religion cannot be favored over another. Think of the Equal Protection clause emphasizing the word "protection". The government has to protect everyone equally but does not have to treat them identically after that. So, every union gets the right to free speech. Once provided that right, every union would have a hard time collecting dues or getting its message out. But legally, as long as the state can show a rational basis for helping one union over another, the subsidy is allowed.

Regarding the points you raise, about the constitution of the state or spirit of democracy: first, the state courts could look at this differently but I doubt it. I think the analysis remains the same. Plus, the same issues are not being challenged at the state level. The decision by Judge Colas was based on a different theory and we'll see how the state Court of Appeals responds to it.

Second, just because the courts say it is not illegal does not mean the outcome is right or fair. This decision simply says the state did not act illegally and that it chose one possible method out of several reasonable ones. If people do not think that is how the state should treat unions, then that is not for the courts to fix. But rather, it should be changed through the legislature and voting process. So all the doors for change are not closed.

Nilesh Patel

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About This Blog

 Diane Hamilton, PCC, SPHR, is the owner and founder of Calibra, a coaching and consulting firm focused on maximizing leadership potential. Nilesh Patel is the principal attorney of the Mahadev Law Group, LLC, which focuses on human resources and employment law issues for organizations. He can be reached at npp@mahalawgroup.com. Both bloggers are members of Wisconsin SHRM, which is dedicated to being the state leader in HR management and the premier source for HR expertise and resources. More information can be found at www.wishrm.org. You can follow the WI SHRM blog at http://wishrm.wordpress.com.

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