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Appeals Court Rules Organizing A Valid Charge for Fee Payers

April 1, 2002

Unions can charge non-members for organizing expenses, an 11-judge federal appeals court unanimously ruled last week. This decision is the first on the issue from a full appellate court.

That ruling by the United States Court of Appeals for the Ninth Circuit in California reverses an earlier decision by a three-judge panel and sets up the possibility of appeal to the Supreme Court. At issue is an often-debated topic in labor relations: what non-union members of collective bargaining units are obligated to pay the union for representing them.

Under federal law, workers who choose to join a union must pay full union dues, while employees at unionized workplaces who opt not to join pay a fee usually equivalent to full union dues. A 1988 Supreme Court decision (CWA v. Beck) found that fee-paying non-members may only be charged for activities that are reasonably related to collective bargaining. Until now, organizing was among those activities considered "nonchargeable," which fee objectors were not required to support. (The exception occurs in the states with "right-to-work" laws under which non-members cannot be required to pay dues equalizing fees.)

As a result of the decision, now unions in California and 27 other states will have more money to organize, labor relations experts say.

AFL-CIO President John Sweeney said the decision will benefit both unionized and unorganized workers.

"Were pleased the Ninth Circuit has so strongly reaffirmed what Americas union workers have long knownthat the best way to win good wages and benefits is to organize," Sweeney said. "Helping other workers form unions strengthens everyones hand at the bargaining table and makes our communities stronger."

The role of organizing new members has become even more important to unions in recent years as layoffs, downsizing, global competition and general trends have lowed overall union membership.

The case affirms a 1999 decision of the National Labor Relations Board, which in a 4-1 ruling, held that organizing was "germane" to collective bargaining and therefore the employees could be charged for organizing activities at other workplaces. The case involved supermarkets where the United Food and Commercial Workers represents workers.

Writing for the ninth circuit judges, Stephen Reinhardt said the NLRB decision was supported by research and data showing that high rates of unionization through organizing clearly benefits all workers. "Numerous studies by economists and labor scholarsdocumented" that the higher the percentage of unionization in an industry, the higher the wage rate," he wrote.