Chicago Teachers Union, Local No Aft v. Hudson

Decision Date04 March 1986
Docket NumberAFL-CIO,No. 84-1503,84-1503
PartiesCHICAGO TEACHERS UNION, LOCAL NO. 1, AFT,, et al., Petitioners v. Annie Lee HUDSON et al
CourtU.S. Supreme Court
Syllabus

Petitioner Chicago Teachers Union has been the exclusive collective-bargaining representative of the Chicago Board of Education's educational employees since 1967. Approximately 95% of the employees are members of the Union. Until 1982, the members' dues financed the entire cost of the Union's collective bargaining and contract administration, and nonmembers received the benefits of the Union's representation without making any contributions to its cost. In an attempt to solve this "free rider" problem, the Union and the Board entered into an agreement requiring the Board to deduct "proportionate share payments" from nonmembers' paychecks. The Union determined that the "proportionate share" assessed on nonmembers was 95% of union dues, computed on the basis of the Union's financial records. The Union also established a procedure for considering nonmembers' objections to the deductions. After the deduction was made, a nonmember could object by writing to the Union President, and the objection would then meet a three-stage procedure: (1) the Union's Executive Committee would consider the objection and notify the objector within 30 days of its decision; (2) if the objector disagreed with that decision and appealed within another 30 days, the Union's Executive Board would consider the objection; and (3) if the objector continued to protest after the Executive Board's decision, the Union's President would select an arbitrator. If an objection was sustained at any stage, the remedy would be a reduction in future deductions and a rebate for the objector. Respondent objecting nonmembers of the Union brought suit in Federal District Court, challenging the Union procedure on the grounds that it violated their First Amendment rights to freedom of expression and association and their Fourteenth Amendment due process rights and also permitted the use of their proportionate shares for impermissible purposes. The District Court rejected the challenges and upheld the procedure. The Court of Appeals reversed, holding that the procedure was constitutionally inadequate. The court rejected the Union's defense that its subsequent adoption of an arrangement whereby it voluntarily placed all of the objectors' agency fees in escrow cured any constitutional defects.

Held:

1. Under an agency shop agreement, procedural safeguards are necessary to prevent compulsory subsidization of ideological activity by nonunion employees who object thereto while at the same time not restricting the union's ability to require any employee to contribute to the cost of collective-bargaining activities. The fact that nonunion employees' rights are protected by the First Amendment requires that the procedure be carefully tailored to minimize an agency shop's infringement on those rights. And the nonunion employee must have a fair opportunity to identify the impact on those rights and to assert a meritorious First Amendment claim. Pp. 301-304.

2. Here, the original Union procedure contained three constitutional defects. First, it failed to minimize the risk that nonunion employees' contributions might be temporarily used for impermissible purposes. Second, it failed to provide nonmembers with adequate information about the basis for the proportionate share from which the advance deduction of dues was calculated. And third, it failed to provide for a reasonably prompt decision by an impartial decisionmaker. The nonunion employee, whose First Amendment rights are affected by the agency shop itself and who bears the burden of objecting, is entitled to have his objections addressed in an expeditious, fair, and objective manner. Pp. 304-309.

3. The Union's subsequent adoption of an escrow arrangement did not cure all of these defects. Two still remain—failure to provide an adequate explanation for the advance reduction of dues and to provide for a reasonably prompt decision by an impartial decisionmaker. Pp. 309-310.

743 F.2d 1187 (CA7 1984), affirmed.

STEVENS, J., delivered the opinion for a unanimous Court. WHITE, J., filed a concurring opinion, in which BURGER, C.J., joined, post, p. 311.

Laurence Gold, Washington, D.C., for petitioners.

Edwin Vieira, Jr., Manassas, Va., for respondents.

Justice STEVENS delivered the opinion of the Court.

In Abood v. Detroit Board of Education, 431 U.S. 209, 97 S.Ct. 1782, 52 L.Ed.2d 261 (1977), "we found no constitutional barrier to an agency shop agreement between a municipality and a teacher's union insofar as the agreement required every employee in the unit to pay a service fee to defray the costs of collective bargaining, contract administration, and grievance adjustment. The union, however, could not, consistently with the Constitution, collect from dissenting employees any sums for the support of ideological causes not germane to its duties as collective-bargaining agent." Ellis v. Railway Clerks, 466 U.S. 435, 447, 104 S.Ct. 1883, 1892, 80 L.Ed.2d 428 (1984). The Ellis case was primarily concerned with the need "to define the line between union expenditures that all employees must help defray and those that are not sufficiently related to collective bargaining to justify their being imposed on dissenters." Ibid. In contrast, this case concerns the constitutionality of the procedure adopted by the Chicago Teachers Union, with the approval of the Chicago Board of Education, to draw that necessary line and to respond to nonmembers' objections to the manner in which it was drawn.

I

The Chicago Teachers Union has acted as the exclusive collective-bargaining representative of the Board's educational employees continuously since 1967. Approximately 95% of the 27,500 employees in the bargaining unit are members of the Union. Until December 1982, the Union members' dues financed the entire cost of the Union's collective bargaining and contract administration. Nonmembers received the benefits of the Union's representation without making any financial contribution to its cost.

In an attempt to solve this "free rider" problem, the Union made several proposals for a "fair share fee" clause in the labor contract. Because the Illinois School Code did not expressly authorize such a provision, the Board rejected these proposals until the Illinois General Assembly amended the School Code in 1981.1 In the following year, the Chicago Teachers Union and the Chicago Board of Education entered into an agreement requiring the Board to deduct "proportionate share payments" from the paychecks of nonmembers. The new contractual provision authorized the Union to specify the amount of the payment; it stipulated that the amount could not exceed the members' dues. The contractual provision also required the Union to indemnify the Board for all action taken to implement the new provision.

For the 1982-1983 school year, the Union determined that the "proportionate share" assessed on nonmembers was 95% of union dues. At that time, the union dues were $17.35 per month for teachers and $12.15 per month for other covered employees; the corresponding deduction from the nonmembers' checks thus amounted to $16.48 and $11.54 for each of the 10 months that dues were payable.

Union officials computed the 95% fee on the basis of the Union's financial records for the fiscal year ending on June 30, 1982. They identified expenditures unrelated to collective bargaining and contract administration (which they estimated as $188,549.82). They divided this amount by the Union's income for the year ($4,103,701.58) to produce a percentage of 4.6%; the figure was then rounded off to 5% to provide a "cushion" to cover any inadvertent errors.

The Union also established a procedure for considering objections by nonmembers. Before the deduction was made, the nonmember could not raise any objection. After the deduction was made, a nonmember could object to the "proportionate share" figure by writing to the Union President within 30 days after the first payroll deduction. The objection then would meet a three-stage procedure. First, the Union's Executive Committee would consider the objection and notify the objector within 30 days of its decision. Second, if the objector disagreed with that decision and appealed within another 30 days, the Union's Executive Board would consider the objection. Third, if the objector continued to protest after the Executive Board decision, the Union President would select an arbitrator from a list maintained by the Illinois Board of Education. The Union would pay for the arbitration, and, if there were multiple objections, they could be consolidated. If an objection was sustained at any stage of the procedure, the remedy would be an immediate reduction in the amount of future deductions for all nonmembers and a rebate for the objector.

In October 1982, the Union formally requested the Board to begin making deductions and advised it that a hearing procedure had been established for nonmembers' objections. The Board accepted the Union's 95% determination without questioning its method of calculation and without asking to review any of the records supporting it. The Board began to deduct the fee from the paychecks of nonmembers in December 1982. The Board did not provide the nonmembers with any explanation of the calculation, or of the Union's procedures. The Union did undertake certain informational efforts. It asked its member delegates at all schools to distribute flyers, display posters, inform nonmembers of the deductions, and invite nonmembers to join the Union with an amnesty for past fines. It also described the deduction and the protest procedures in the December issue of the Union newspaper, which was distributed to nonmembers.

Three nonmembers—Annie Lee Hudson, K. Celeste Campbell, and Walter Sherrill—sent...

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