News Story

Teachers Union Could Face Millions In Clawback Payments To Workers

Federal class-action lawsuit contends compulsory fee payments violated government workers' free speech

Two Michigan public school employees have filed a federal class action lawsuit against the Michigan Education Association, demanding the return of union fees they had paid to the teachers union.

The complaint comes after the U.S. Supreme Court’s June ruling in the case Janus v. AFSCME, in which the court said that compelling public sector employees to pay union dues and fees violates their First Amendment free speech and free association rights.

If the plaintiffs prevail, the MEA could be ordered to return millions of dollars to thousands of Michigan school employees, not just the two plaintiffs.

The plaintiffs, Linda Gervais and Tammy Williams, were Port Huron Area School District employees who stopped paying union fees after Michigan adopted a right-to-work law. That law prohibits an employer from making workers pay union fees as a condition of employment, which is otherwise allowed under federal labor law.

Gervais and Williams say that when they tried to stop paying the MEA after right-to-work went into effect, union officials subjected them to harassment and debt collection agencies. They are being represented by the National Right to Work Legal Defense Foundation, a nonprofit public interest law firm. The federal suit was filed in the U.S. District Court for the Western District of Michigan.

Gervais and Williams resigned from their union memberships in September 2013, about six months after Michigan’s right-to-work law went into effect. The women say the MEA kept demanding that they pay fees despite the new law, and even threatened to take them to small claims court for not paying.

The MEA contends that despite right-to-work, Gervais and Williams are liable for the payments because they failed to observe the union’s procedures for opting out of them. Specifically, the union asserts that this choice could only be made during a short time period in August called the op-out window.

According to Patrick Wright, vice president for legal affairs at the Mackinac Center for Public Policy, many Michigan workers have faced similar roadblocks to opting out of union fee payments. Wright said that five years after the law was enacted, the number is winding down.

“Most of the people who have wanted to get out have gotten out,” Wright said.

The issue of possible clawbacks of past union fee payments is a new element that arose only after the U.S. Supreme Court’s Janus ruling. The case transformed what had been a possible violation of state law into a denial of the First Amendment rights of thousands of public employees. It has also opened the door to class action lawsuits on behalf of those workers.

The clawback question applies to unionized public sector workers who had stopped paying optional union dues, but - before right-to-work or Janus — still had to to pay union fees. The fees were supposed to cover just the cost of union collective bargaining and contract maintenance, while separate and voluntary union dues could be used for other purposes, including political activity.

The same First Amendment issues have caused government entities and unions across the country to stop withholding union fees from the paychecks of people who had opted out of dues payments, if they had been doing so. 

The SEIU settled the lawsuit for $2,200 with an Oregon woman who had claimed the union had violated her constitutional rights by taking money from her even though she wasn’t a dues-paying union member, according to the International Public Management Association for Human Resources.

The Buffalo News reported that the state of New York stopped taking agency fees from thousands of public employees in as many as 29 different unions. The state stopped the forced-withdrawal of agency fees about two weeks after the Janus decision.

Wright said he is not surprised to see such a case after Janus, and thinks the plaintiffs have a point.

“There is a decent claim that Janus is a constitutional matter and any kind of waiver that they had signed before Janus came into effect is voided,” said Wright. He was referring to union documents that employees in unionized workplaces were encouraged or required to sign when they first started working there.

Wright explained that, “What the MEA will argue in response is that these people were still members at the time and that Janus only applies to nonmembers. But there is some question as to the breadth of Janus and what it means for people that only stayed members because they didn’t know they really had a choice.”

He also said that the ability to file a class action lawsuit now gives additional protections to people who want to opt out of unions.

Prior to Janus, Wright said, every single person who wanted to leave the union would need to hire their own attorney and file their own case, which is costly and complicated.

“So, you had a lot of people who probably just gave up,” said Wright. “It put some pressure on some people who wanted to exercise their statutory rights.”

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.