Constitutional Law

Supreme Court Preview: Should Employers be Permitted to Use State Money to Fight (or Support) Union Organizing?

By Scott A. Kronland, Altshuler Berzon LLP. Scott Kronland represents the AFL-CIO and California Labor Federation in Chamber of Commerce v. Brown, scheduled for oral argument before the U.S. Supreme Court on March 19, 2008.

Supreme Court precedents draw a distinction between the government prohibiting or penalizing private activity and the government merely refusing to subsidize that activity. For example, political lobbying enjoys core First Amendment protection, but the government can decline to subsidize lobbying through the tax code. Likewise, the existence of a constitutional right to obtain an abortion does not mean the government must pay for indigent women to obtain abortions, even if the government otherwise pays for their medical care. And the government can deny food stamps to the families of striking workers, even though the right to strike is protected by the First Amendment.

Chamber of Commerce v. Brown, which will be heard by the Supreme Court on Wednesday, involves arguments about whether the same prohibit/subsidize distinction should apply when a state law is claimed to be preempted by the National Labor Relations Act (NLRA).

At issue is a California law that prohibits employers from using state grant and program funds "to assist, promote, or deter union organizing." The California Legislature enacted this statute in 2000 after receiving complaints that it is unfair for the State to subsidize employer campaigns about unionization when the State does not subsidize unions' efforts to organize workers.

The California Legislature stated that the law's purpose is to preserve California's neutrality about union organizing. The California law does not prohibit employers from using their own funds to pay for lobbying employees about whether to unionize -- only from using state funds for that purpose.

The U.S. Chamber of Commerce challenged the California law, arguing it is preempted by the NLRA, because, among other things, it impermissibly regulates employer speech about unionization. Although the district court agreed with the Chamber, the Ninth Circuit ultimately reversed the district court in a 12-3 en banc decision upholding the law.

In addition to relying on the prohibit/subsidize distinction, the Ninth Circuit reasoned that preemption is an issue of Congressional intent: Congress' adoption of restrictions on the use of federal money to "assist, promote, or deter union organizing" makes it unlikely that Congress intended the NLRA to preclude California from adopting similar restrictions on the use of state money. The Ninth Circuit also rejected the Chamber of Commerce's arguments about the compliance burdens the law allegedly imposes upon businesses, ruling that those complaints were beyond the scope of the Chamber's facial challenge.

The National Labor Relations Board and the courts have held that the NLRA allows employers to hold mandatory captive audience meetings of their employees to lobby the employees about whether to unionize, while at the same time denying union representatives any access to the workplace. In Chamber v. Brown, employers are taking matters a step further by arguing that the NLRA requires California taxpayers to pay for employers' campaigns about unionization if the employers receive money from state grants or programs that can otherwise be used to pay for employee relations costs.

In recent years,the NLRA has been increasingly invoked as a protection for employers rather than workers. Chamber v. Brown may show whether this anti-employee trend will continue, with state laws protecting workers (or, in this case, just protecting state neutrality) being struck down as  interference with the rights of businesses.

Full post as published by ACS Blog on March 18, 2008 (boomark / email).