Dashiell v. Montgomery County, Md.

• Decision Date: 04 March 1991
• Docket Number: No. 90-2350,90-2350
• Citation: 925 F.2d 750
• Parties: 136 L.R.R.M. (BNA) 2550, 59 USLW 2520 Marie E. DASHIELL; William H. Van Aller; Harold L. Ritenour; Richard Newcome; Joe Mitchell Miller; David Ertter, On behalf of themselves and as a class of similarly situated employees, Plaintiffs-Appellants, v. MONTGOMERY COUNTY, MARYLAND; Sidney Kramer, County Executive; Lewis T. Roberts, Chief Administrative Officer; Montgomery County Council; Montgomery County Government Employees Organization; United Food and Commercial Workers, Local 400; Fiorigia Renne, Vice President, Local 400, United Food & Commercial Workers Union President, McGeo; Thomas R. McNutt, President Local 400 United Food & Commercial Workers Union, Defendants-Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 750

925 F.2d 750

136 L.R.R.M. (BNA) 2550, 59 USLW 2520

Marie E. DASHIELL; William H. Van Aller; Harold L Ritenour; Richard Newcome; Joe Mitchell Miller; David Ertter, On behalf of themselves and as a class of similarly situated employees, Plaintiffs-Appellants, v. MONTGOMERY COUNTY, MARYLAND; Sidney Kramer, County Executive; Lewis T. Roberts, Chief Administrative Officer Montgomery County Council; Montgomery County Government Employees Organization; United Food and Commercial Workers Local 400; Fiorigia Renne, Vice President, Local 400 United Food & Commercial Workers Union President, McGeo; Thomas R. McNutt, President Local 400 United Food & Commercial Workers Union, Defendants-Appellees.

No. 90-2350.

United States Court of Appeals, Fourth Circuit.

Argued Oct. 30, 1990.

Decided Feb. 13, 1991.

Rehearing and Rehearing In Banc

Denied March 4, 1991.

Rossie David Alston, Jr., National Right to Work Legal Defense Foundation, Inc., Springfield, Va., for plaintiffs-appellants.

William W. Thompson, II, Zwerdling, Paul, Leibig, Kahn, Thompson & Driesen, P.C. (on brief: Michael T. Leibig, Zwerdling, Paul, Leibig, Kahn, Thompson & Driesen, P.C.), Washington, D.C., for defendants-appellees.

Before HALL and NIEMEYER, Circuit Judges, and CACHERIS, United States District Judge for the Eastern District of Virginia, sitting by designation.

NIEMEYER, Circuit Judge:

In Chicago Teachers Union v. Hudson, 475 U.S. 292, 106 S.Ct. 1066, 89 L.Ed.2d 232 (1986), the Supreme Court held that the First Amendment requires that nonunion employees in an agency shop be afforded an adequate advance explanation of the basis for the collective bargaining fee charged to them by the union as their exclusive bargaining agent. The explanation is necessary to provide information sufficient to enable the nonunion employees to object to and protect against compulsory participation, through the payment of funds, in union activities unrelated to collective bargaining. The First Amendment prohibits a compulsory subsidization, even temporarily, by nonunion employees of political or ideological causes to which they are opposed. Id. at 305, 106 S.Ct. at 1075.

Marie Dashiell and five other nonunion employees of Montgomery County, Maryland, have filed suit to challenge the adequacy of the explanation provided by their exclusive bargaining representative, the Montgomery County Government Employees Organization, a division of United Food and Commercial Workers Union Local 400 (the Union), for fees that the Union intended to charge nonunion employees in 1988. Specifically, they contend that the information provided to them had not been subjected to proper independent "verifications, audits or certifications in accordance with the principles of Hudson." Brief of Appellants at v. Suit was brought under 42 U.S.C. Sec. 1983 and the First and Fourteenth Amendments. The district court granted summary judgment in favor of the Union, concluding that neither the First Amendment nor the decision of the Court in Hudson requires that the Union's allocation decision in dividing chargeable expenses from those not chargeable be certified by an independent certified public accountant. The court explained that the allocation of those expenses is based on a complex legal judgment for which certified public accountants are not suited. It concluded that nonunion members receive a constitutionally adequate explanation if they are provided with the Union's position on that which is chargeable and that which is not, with only the amounts in each category verified by an independent auditor. Dashiell v. Montgomery Co., 731 F.Supp. 1251, 1257-59 (D.Md.1990).

For the reasons that follow, we affirm the judgment of the district court.

I

In 1986 Montgomery County, Maryland, recognized the Union as the exclusive bargaining representative for all employees in a bargaining unit consisting of the County's office, professional and technical employees and in a bargaining unit consisting of the County's service, labor and trade employees. The Union entered into collective bargaining agreements for both units for the three-year period of July 1, 1987, through July 30, 1990, establishing an agency shop.

The Montgomery "County Collective Bargaining Law" permits public employees of a bargaining unit to enter into an agency-shop agreement with the County under which all employees, whether union members or not, are required as a condition of employment to pay a "service fee" to the Union for its representation of the employees. Montgomery County Code, Title VII, Secs. 33-101, et seq. The employees are not required to become members of the Union, but they are required to pay a service fee to the Union to cover their share of the costs and expenses related to collective bargaining. They are not, however, required to pay for other costs unrelated to collective bargaining.

To provide an explanation to nonunion employees of how the service fee, or agency fee as it is sometimes called, is computed, the Union sent each nonunion member a letter dated June 8, 1988, together with a packet of information. The letter advised that the service fee for the year 1988 would be set at 82.59% of the regular dues paid by voluntary union members, or $6.19 per month. The letter also specified the method by which an employee could object to the fee and established July 15, 1988, as the deadline for objecting. The attached packet contained lists and data supporting the amount of the fee, including audited financial records of the Union.

On review of the letter and the attached packet, Dashiell and the other five plaintiffs concluded that the information provided by the Union did not comply with the requirements described by the Supreme Court in Hudson, and they therefore filed this action. They contend that the notice contained "no audit opinion" by an independent accountant that verifies the allocation between expenses chargeable to all employees and expenses chargeable only to Union members. The district court granted the Union's motion for summary judgment and this appeal followed.

II

The Supreme Court first considered the constitutionality of a union shop, of which an agency shop is a variation, in the context of the Railway Labor Act, 45 U.S.C. Secs. 151 et seq. The Court concluded that Congress had the power, in the exercise of its right to regulate commerce, to permit a union shop "as a stabilizing force" to promote "industrial peace" and that the union shop provision of the Railway Labor Act, 45 U.S.C. Sec. 152, Eleventh, did not violate the First or Fifth Amendments. Railway Employes' Dep't v. Hanson, 351 U.S. 225, 233, 238, 76 S.Ct. 714, 718, 721, 100 L.Ed. 1112 (1956). Ruling that the Railway Labor Act permissibly required beneficiaries of trade unionism to contribute to the costs of collective bargaining, the Court cautioned that "[i]f 'assessments' are in fact imposed [by the union] for purposes not germane to collective bargaining, a different problem would be presented." Id. at 235, 76 S.Ct. at 720. See also International Ass'n of Machinists v. Street, 367 U.S. 740, 81 S.Ct. 1784, 6 L.Ed.2d 1141 (1961) (legislative history of Railway Labor Act mandated a construction that the act did not authorize expenditures by unions of funds on political causes unrelated to collective bargaining).

These decisions rested on the implied principle that the governmental interest in trade unionism and the industrial peace that was anticipated justified the compromise of the First Amendment rights of dissenting employees. By governmental action these employees were compelled to associate with and participate in an organization with whose agenda and principles they disagreed. Later decisions of the Supreme Court expressly acknowledged the principle. See Abood v. Detroit Bd. of Educ., 431 U.S. 209, 222, 97 S.Ct. 1782, 1792, 52 L.Ed.2d 261 (1977) (interference in employees' First Amendment rights are justified by the legislative assessment of the importance of union shops to the system of labor relations); and Ellis v. Railway Clerks, 466 U.S. 435, 104 S.Ct. 1883, 80 L.Ed.2d 428 (1984). In Ellis the Court said:

[B]y allowing the union shop at all, we have already countenanced a significant impingement on First Amendment rights. The dissenting employee is forced to support financially an organization with whose principles and demands he may disagree.... It has long been settled that such interference with First Amendment rights is justified by the governmental interest in industrial peace.

Id. at 455-56, 104 S.Ct. at 1896.

Because First Amendment freedoms are compromised by a state-authorized union or agency shop, any impingement must be drawn as narrowly as is consistent with the state's interest in permitting an exclusive representative to represent all employees for collective bargaining purposes. In the context of state action, therefore, if a union strays from its permitted function of collecting funds for collective bargaining activities, its conduct will be prohibited. See Abood, 431 U.S. at 234-36, 97 S.Ct. at 1799-1800 (the First Amendment prohibits a state-employee union from collecting fees from nonunion employees to fund ideological causes to which the employees were opposed).

The First Amendment will not tolerate a compulsory subsidization, even if only temporarily, by nonunion employees of fees used for union activities unrelated to collective bargaining. The union therefore may not use a rebate approach under which it collects uniform union dues from all employees and later returns the portion unrelated to collective bargaining to nonunion employees. Ellis, 466 U.S. at 443-44, 104 S.Ct. at 1889-90. The union must use an approach by which amounts charged for collective bargaining services are reasonably calculated to be correct from the outset.

Thus, in Chicago Teachers Union v. Hudson the Court specified procedures that must be followed by the union in allocating the proper charges to...