Andrews v. Education Ass'n of Cheshire, 1215

Decision Date21 September 1987
Docket NumberD,No. 1215,1215
Citation829 F.2d 335,127 L.R.R.M. 2929
Parties127 L.R.R.M. (BNA) 2929, 41 Ed. Law Rep. 1254 Howard K. ANDREWS, et al., Plaintiffs-Appellants, v. EDUCATION ASSOCIATION OF CHESHIRE, et al., Defendants-Appellees. ocket 87-7225.
CourtU.S. Court of Appeals — Second Circuit

John C. Scully, Nat. Right to Work Legal Defense Foundation, Springfield, Va. (Michalik & Lynch, New Britain, Conn., Dennis Cicarillo, of counsel), for plaintiffs-appellants.

Robert H. Chanin, Washington, D.C. (Bredhoff & Kaiser, Washington, D.C., Bruce R. Lerner, Connecticut Educ. Ass'n, Hartford, Conn., Ronald Cordilico, William Dolan, of counsel), for defendants-appellees.

George E. Finlayson, Jr., Waterbury, Conn. (Siegel, O'Connor, Schiff, Zangari & Kainen, P.C., Waterbury, Conn., of counsel), for defendant-appellee Waterbury Bd. of Educ.

Before FEINBERG, Chief Judge, LUMBARD, and NEWMAN, Circuit Judges.

LUMBARD, Circuit Judge:

On this appeal we are asked to decide the constitutionality of a set of procedures used by a group of Connecticut teachers unions for allocating collective bargaining, contract administration and grievance adjustment expenses for the purpose of charging agency fees to nonmembers. Appellants, a group of non-union employees of the various Connecticut school boards that are named as defendants in this action, appeal from a judgment entered by Judge Jose A. Cabranes in the District of Connecticut on February 18, 1987. Judge Cabranes denied plaintiffs' motion for summary judgment, granted defendants' cross-motion for summary judgment and dismissed plaintiffs' pendant state law claim for lack of jurisdiction. The decision is reported as Andrews v. Education Ass'n of Cheshire at 653 F.Supp. at 1373 (D.Conn.1987). Plaintiffs maintain that Judge Cabranes erred in refusing to hold the defendants' proposed procedures for collecting the agency fees unconstitutional under Chicago Teachers Union v. Hudson, 475 U.S. 292, 106 S.Ct. 1066, 89 L.Ed.2d 232 (1986). We affirm the judgment of the district court but remand with directions to enjoin the union from exercising any alleged right under its agreement with the American Arbitration Association unilaterally to waive an oral hearing on any nonmember's dissent.


Plaintiffs are nonunion teachers employed by one of three Connecticut boards of education--Cheshire, New Milford and Waterbury. These three boards have collective bargaining agreements with their respective education associations--the Cheshire Education Association, the New Milford Education Association and the Waterbury Teachers Association (collectively "LEAs"). Each LEA recognizes its education association as its exclusive bargaining representative. All the local associations are affiliates of the Connecticut Education Association ("CEA") and the National Education Association ("NEA").

Each of these collective bargaining agreements provides that if an employee of one of the local associations chooses not to become a member of the union which represents the local's employees, that employee remains obligated to pay an agency fee to the union. These fees are designed to allocate a pro-rata share of the union's collective bargaining and grievance adjustment expenses to non-union employees who receive the benefits of such activities, but who do not pay dues. The deductions are based on the provisions of the Connecticut Teacher Negotiations Act, Conn.Gen.Stat. Sec. 10-153a(b). That statute authorizes a local association to pay a service fee to the exclusive bargaining representative of its employees in an amount "not greater than the amount of dues uniformly required of members of the exclusive bargaining representative organization which represents the costs of collective bargaining administration and grievance adjustment." Under the plans these fees are collected by the local association through an automatic payroll deduction; from those deductions, each LEA pays a portion of the agency fee to the CEA and the NEA.

Plaintiffs have elected not to become members of the defendant labor unions but are in the bargaining units represented by these defendants, and, in accordance with the plan, they are charged agency fees. They now challenge the procedures under which the agency fees are computed. They claim that the procedures provided for by the plan do not meet the constitutional requirements recently considered by the Supreme Court in Hudson. Pursuant to a pretrial order of May 14, 1986, defendants filed with the district court a written description of a proposed agency fee collection plan for their respective bargaining units.

Under the plan, prior to November 15 of each year, the unions send a memorandum to each nonmember required to pay an agency fee, which indicates the amount of the fee that the associations intend to charge and how that fee was calculated by listing expenditures for each major category of chargeable activity. The plan provides that that memorandum shall also inform each potential objector as to the procedure he or she must follow to challenge the amount of the fee. Together with this memorandum, each nonmember receives "such additional information as may be necessary for him or her to gauge the propriety" of the fee, including the budgets of each LEA, the CEA, and the NEA projecting expenditures for the current service fee year and end-of-year financial reports for each LEA, the CEA, and the NEA for the immediately preceding year, together with statements for an independent auditor or authorized association representative verifying those reports. Nonmembers have at least thirty days after receiving the reports to file an objection with the CEA. Nonmembers who do object to any portion of the fee pay 100% of their service fee into an interest-bearing escrow account at the Connecticut National Bank until the challenge is resolved.

If any nonmembers challenge the fee, the unions contact the American Arbitration Association (AAA) under a pre-existing contract between the union and the AAA and ask it to select, from a list of arbitrators experienced in public sector labor relations, an arbitrator to hear the dispute. The arbitrator then conducts the hearing in accordance with standard AAA rules for determination of agency fees. The unions are required to prove at these hearings the percentage of CEA and NEA budgets which will be expended for activities that may be lawfully charged to objecting nonmembers; the procedure assumes that each of the LEAs expends at least as large a percentage of their budgets on chargeable activities as does the state-wide CEA. 1 Unless an extension is granted, the arbitrator must file his opinion by January 30. After that, the unions must recalculate their fee to comport with the arbitrator's decision and, if necessary, rebate some of the money in the escrow accounts and make whatever adjustments are necessary in the objecting nonmembers' future payments.

In the district court prior to trial, the plaintiffs made six constitutional challenges to the defendants' agency fee collection procedures. Judge Cabranes rejected each of those challenges and found the procedures to be constitutional. He dismissed the plaintiffs' pendant state law claim for lack of subject matter jurisdiction and granted judgment for the defendants.


Plaintiffs advance two arguments. First, they contend that the defendants' procedure is constitutionally deficient because an independent auditor does not verify the financial information that the unions use to classify expenses into the various categories of expenditures. Second, they maintain that the AAA does not satisfy the constitutional requirement for an impartial decisionmaker.

The Supreme Court has recently dealt with the issue of agency fees. In Hudson, the Court considered the constitutionality of procedures "to draw that necessary line [between contract bargaining and administration costs which are properly charged to nonmembers and sums for the support of ideological causes which are not] and to respond to nonmembers' objections to the manner in which it was drawn." 106 S.Ct. at 1069.

The Court founded its decision that unions which are the sole bargaining agents for employees of public agencies may charge nonmembers for bargaining and administrative costs on Abood v. Detroit Board of Education, 431 U.S. 209, 97 S.Ct. 1789, 52 L.Ed.2d 261 (1977). The Court quoted Abood for the proposition that "[T]he objective must be to devise a way of preventing compulsory subsidization of ideological activity by employees who object thereto without restricting the Union's ability to require every employee to contribute to the cost of collective bargaining activities." 106 S.Ct. at 1074. The Court explained that "the fact that [the nonmembers' rights to refuse to support causes in which they did not believe] are protected by the First Amendment requires that the procedure be carefully tailored to minimize the infringements." Id. In a footnote in Hudson, the Court cited several cases that held that when First Amendment rights are implicated, the government must adopt the least restrictive means available that will allow it to pursue a legitimate state interest to satisfy this "carefully tailored requirement." Id. at 1074 n. 11. Hudson therefore recognizes two distinct interests: first, the nonmembers' First Amendment right not to be coerced to contribute funds to support political activities that they do not wish to support and, second, the union's and the government's interest in establishing a rational system to consummate labor negotiations. The decision therefore mandated that the unions and government use a narrowly drawn plan that protects the nonmembers' first amendment interests while allowing the unions and government to pursue their own needs.

After analyzing the procedures used by the Union in Hudson to charge nonmembers for bargaining and administrative costs, the Court found the procedures...

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