Download - James Sweeney vs. Mike Pence

In the

United States Court of Appeals For the Seventh Circuit

____________________No.131264JAMESM.SWEENEY,etal.,

PlaintiffAppellants,v.

MICHAELPENCE,GovernoroftheStateofIndiana,etal.,

DefendantAppellees.____________________

AppealfromtheUnitedStatesDistrictCourtfortheNorthernDistrictofIndiana,HammondDivision.

No.2:12cv00081PPSPRCPhilipP.Simon,ChiefJudge.____________________

ARGUEDSEPTEMBER12,2013DECIDEDSEPTEMBER2,2014____________________

BeforeWOOD,ChiefJudge,andMANIONandTINDER,CircuitJudges.

TINDER,Circuit Judge.PlaintiffAppellants,membersandofficers of the InternationalUnion ofOperatingEngineers,Local150,AFLCIO(theUnion)appealthedistrictcourtsdismissal of their suit, arguing that the Indiana Right toWorkActviolatestheirrightsundertheUnitedStatesConstitution and ispreemptedby federal labor legislation.Be

Case: 13-1264 Document: 28 Filed: 09/02/2014 Pages: 59

2 No.131264

causethelegislationisnotpreemptedbytheschemeoffederallaborlawanddoesnotviolateanyconstitutionalrights,weaffirmthedistrictcourtsdismissalofthesuit.

IAfter a rancorous, partisan monthlong fight during

whichhundredsofunionmemberscrowded,dayafterday,intotheStatehousehalls,1theIndianalegislaturepassedtheIndianaRighttoWorkActonFebruary1,2012,andGovernorMitchDanielssignedthelegislationintolaw.Thelawsrelevantprovisionsforthislitigationarethefollowing.Section8,whichspellsout theprincipalprohibitionsof

theRighttoWorkAct:Apersonmaynotrequireanindividualto:(1) Becomeor remainamemberofa labor

organization;(2) Pay dues, fees, assessments, or other

chargesofanykindoramounttoalabororganization;or

(3) Pay to a charity or third party anamount that is equivalent to or a prorata part of dues, fees, assessments orotherchargesrequiredofmembersofalabororganization

1MonicaDavey, IndianaGovernor Signs aLawCreating a Right toWork State, N.Y. TIMES (Feb. 2, 2012) at A12, available athttp://www.nytimes.com/2012/02/02/us/indianabecomesrighttoworkstate.html(lastaccessedAug.20,2014).


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asaconditionofemploymentorcontinuationofemployment.

IND.CODE22668.Section 3, which makes clear what substantive provi

sionsoftheRighttoWorkActaretobeconstruedtoapplytothebuildingandconstructionindustry:

Nothing in thischapter is intended,orshouldbeconstrued,tochangeoraffectany lawconcerningcollectivebargainingorcollectivebargaining agreements in the building and constructionindustryotherthan:

(1) a law that permits agreements thatwould requiremembership in labororganization;

(2) a law that permits agreements thatwould require the payment of dues,fees, assessments, or other charges ofanykindofamounttoalabororganization;or

(3) a law that permits agreements thatwouldrequire thepayment toacharityor a third party of an amount that isequivalenttooraproratapartofdues,fees, assessment, or other charges requiredofmembersofa labororganization;

asaconditionofemployment.IND.CODE22663.


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AndSection13,whichmakesclear thatSections812oftheActapplyprospectively:

Sections8through12ofthischapter:(1) apply to a written or oral contract or

agreement entered into, modified, renewed, or extended after March 14,2012;and

(2) donotapplytoorabrogateawrittenororal contract or agreement in effect onMarch14,2012.

IND.CODE226613.On February 22, 2012, PlaintiffAppellants, officers and

membersoftheInternationalUnionofOperatingEngineers,Local 150,AFLCIO (theUnion), brought suit in federaldistrictcourtagainst theGovernorof Indiana, theAttorneyGeneral of Indiana, and the Commissioner of the IndianaDepartmentofLabor in theirofficialcapacities,seekingdeclaratoryrelief.TheyallegedthattheIndianaRighttoWorkActviolates theUnitedStatesConstitutionand the IndianaConstitution.Theyfurtherarguedthattheschemeoffederallabor law, specifically the National Labor Relations Act(NLRA),29U.S.C.151 et seq.,preempts8(2)(3)and3(2)(3)ofthenewlegislation.OnJanuary17,2013,thefederal district court grantedDefendantAppelleesMotion toDismiss on thepreemption claim and the federal constitutionalclaims.PlaintiffAppellantstimelyappealed.22Webrieflynote that there isparallel litigationpending in the Indianastatecourts.Twodecisionshavebeenissuedbystatetrialcourtsinrela

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No.131264 5

IIOnappeal,PlaintiffAppellants raise twovarietiesof is

sues:whetherthelawispreemptedbythefederalschemeoflabor law,andwhether the Indiana lawviolates theUnitedStatesConstitution.Weanswerinthenegativetobothquestions.1. FederalPreemptionPlaintiffAppellantsmain argument asserts that the In

dianarighttowork law ispreemptedby federal legislationonthesametopic.

The history of the federal legislation in question is importanthere.CongressenactedtheWagnerActin1935andamendeditthroughtheLaborManagementRelationsActof1947,betterknownastheTaftHartleyAct.TheTaftHartleyAct includedseveralprovisions intendedtoameliorateperceivedimbalancesintheNLRA.Inparticular,Congresswasconcernedaboutabusesstemmingfromtheclosedshop,aunionsecurity agreement whereby an employer agreed totiontothestatute:inacaseinLakeCountySuperiorCourtbroughtby,interalia, thePlaintiffAppellants (Order,Sweeneyv.Zoeller,No.45D011305PL52(LakeCnty.Super.Ct.Sep.9,2013),DocketNo.23),andinaseparatecase inLakeCountyCircuitCourtbroughtbymembersofanother union (Order, United Steel Paper v. Zoeller, No. 45C011207PL00071 (LakeCnty.Cir.Ct. Jul.17,2014)).Bothdecisionshavebeenappealed to the Indiana Supreme Court. (Docket Records of Zoeller v.Sweeney,No.45S001309PL00596(accessedAug.20,2014);DocketRecordsofZoellerv.UnitedSteelPaper,No.45S001407PL00492(accessedAug. 20, 2014)).The state trial courtsdecisions are far fromfinal inmost respects,and,moreover,havenopreclusiveeffectonourconsiderationoffederalquestionshere.


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hire only union members. Section 8(3) of the Wagner Actwas accordingly amended to ban closed shops. However,the amended Section 8(3) shield[ed] from anunfair laborpracticecharge lesssevere formsofunionsecurityarrangementsthantheclosedorunionshop.NLRB.v.Gen.MotorsCorp.,373U.S.734,739(1963).Forexample,itpermittedanarrangement requiringnonunionmembers topay totheunion$2amonth for thesupportof thebargainingunit.Id.

AlthoughCongresspermittedlessrestrictive,posthiringunionsecurity agreements under federal law, it also leftstates free to ban them. Section 14(b) of theAct providedthatSection8(3)didnotprotectaunionsecurityagreementifitwasprohibitedbyStateorTerritoriallaw.BythetimeSection14(b)wasincludedintheNLRA,twelveStateshadstatutesorconstitutionalprovisionsoutlawingorrestrictingthe closed shop and related devices, laws about whichCongressseemstohavebeenwellinformedduringthe1947debates.RetailClerks IntlAssn,Local1625v.Schermerhorn,375U.S.86,100(1963)(RetailClerksII).

Inrelevantpart,Section8(a)(3)oftheNLRAnowreads:It shall be an unfair labor practice for an

employerbydiscriminationinregardtohireortenureoremploymentoranytermorconditionofemploymenttoencourageordiscouragemembershipinanylabororganization.Provided,Thatnothinginthissubchapter,or

inanyotherstatuteof theUnitedStates,shallpreclude an employer frommaking an agreement with a labor organization (not estab


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lished, maintained, or assisted by any actiondefined in this subsection as an unfair laborpractice) to require as a condition of employmentmembershiptherein.

29U.S.C.158(a)(3).AndSection14(b)oftheNLRAprovides:

Nothing in this subchapter shall be construedasauthorizingtheexecutionorapplicationofagreementsrequiringmembership inalabor organization as a condition of employment in any State or Territory inwhich suchexecutionorapplication isprohibitedbyStateorTerritoriallaw.

29U.S.C.164(b).The Supreme Court has clarified the relationship be

tweenthesetwoprovisions:14(b)wasintendedtopreventothersections intheNLRAfromcompletelyextinguishingstatepowerover certainunionsecurityarrangements.RetailClerks Intern.Assn,Local1625v.Schermerhorn,373U.S.746,751(1963)(RetailClerksI).Specifically,[Section14(b)]wasdesignedtomakecertainthat8(a)(3)couldnotbesaidtoauthorizearrangementsof thissort inStateswheresucharrangements were contrary to the State policy. Id. (citationsand internalquotationmarksomitted).Thus,wereadSection 14(b) as protecting states authority to enact lawsprohibiting unionsecurity arrangements that are permissibleunderSection8(a)(3)andotherprovisionsoftheNLRA.ThisreadingwasunderscoredbytheSupremeCourtsdecisioninRetailClerksII,whichdeclaredthatthelegislativehistory ma[de] clear and unambiguous the purpose ofCon


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gressnot topreempt the field.RetailClerks II, 375U.S. at101.TheCourtconcludedthatCongressin1947didnotdeprive theStatesofanyandallpower toenforce their lawsrestricting theexecutionandenforcementofunionsecurityagreementsandthatitisplainthatCongresslefttheStatesfreetolegislateinthefieldofunionsecurityagreements.Id.at102.Thefreedomreservedtothestatesisextensive;evenif [a]unionsecurityarrangement clearsall federalhurdles,theStatesby reasonof14(b)have the final sayandmayoutlawit.Id.at10203.TheSupremeCourtcouldnothavebeenmoreexplicitregardingthebroadauthorityofstatestoprohibitunionsecurityagreements.

It isagainst thisbackdropofstatesextensiveauthority,reservedtothembythelanguageofthestatuteandtheSupreme Courts interpretation, that we consider PlaintiffAppellantsargumentthatprovisionsoftheIndianarighttowork legislationarepreemptedby federal labor legislation.Theirprimaryargument is thatSection14(b)permitsstatestobanonlyunionsecurityagreementsrequiringmembership,orelsecompellingworkerstopayafullmembershipfee that servesas the functionalequivalentofmembership.TheIndianastatutegoesfurtherbyprohibitingunionsfromcollectinganyfeesandduesfromunwillingemployees.ThePlaintiffAppellantsassert that thisban is toostrictbecauseemployeesmay stillbe required topaya feeequal to theirfair share of the collective bargaining costssomethingless than the full membership feeand not qualify asmembersoftheunionunderSection14(b).Section8(a)(3),whichpermitssucharrangements,wouldthen,accordingtothis argument, apply in full force and preempt any statestatutebarringtheunionspractice.


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PlaintiffAppellants furtherargue that sucha reading isnecessarybecauseunionsarerequiredtoactonbehalfofallemployees in labor disputes, and may not discriminateagainstnonmembers.Tocompel theunion torepresentallemployees equally using dues contributed only by someworkers, they argue, creates a freerider problem. Indeed,theSupremeCourthasobservedthatSection(8)(3)wasdesigned to remedy the inequitiesposedby free riderswhowouldotherwiseunfairlyprofit from theTaftHartleyActsabolition of the closed shop. CommcnsWorkers ofAm. v.Beck,487U.S.735,75354(1988).

Wearenotconvinced thatSection8(3)preempts the Indianastatute,forseveralreasons.a. InterpretationsoftheTermMembershipinthe

NLRAContextPlaintiffAppellants and the dissent admit that the Su

premeCourthasconstruedthetermmembershiptohavethesamemeaninginSections8(a)(3)and14(b).Indeed,thereisnoreasontothinkthatthetermmembershipinSection14(b)wouldmeansomethingdifferentfromthetermmembership in Section 8(a)(3) of the same act. See Sorenson v.SecyofTreasuryofU.S.,475U.S.851,860 (1986) (Thenormal rule of statutory construction assumes that identicalwordsusedindifferentpartsofthesameactareintendedtohave the same meaning.) (citation and quotation marksomitted).As a result, the agreements requiring membership ina laborunionwhichareexpresslypermittedbytheproviso are the same membership agreements expresslyplacedwithinthereachofstatelawby14(b).RetailClerksI, 373 U.S. at 751. If membership for purposes of Section8(a)(3)encompassesanarrangementrequiringnonunion


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memberstopaytotheunion$2amonthforthesupportofthe bargaining unit, Gen. Motors, 373 U.S. at 739, thenmembershipunderSection14(b) should likewise extend tosuchfees.

TheSupremeCourthasdescribedunionmembershipassynonymouswithpayingtheportionofduesgermanetotheunions collective bargaining. It has held that the termmembershipinSection8(a)(3)hasbeenwhittleddowntoitsfinancialcore.Gen.Motors,373U.S.at742.AndtheSupremeCourthasalsomadeclearthatthisfinancialcoreofunion membership extends to only those fees and duesnecessary to performing the duties of an exclusive representativeoftheemployees indealingwiththeemployeronlabormanagement issues.3 Beck, 487 U.S. at 763 (citationand internal quotation marks omitted); see also id. at 745(Thestatutoryquestionpresentedinthiscaseiswhetherthisfinancialcoreincludestheobligationtosupportunionactivities beyond those germane to collective bargaining,contractadministration,andgrievanceadjustment.Wethinkit does not.). In other words, Representation Feesthose3ThedissentstatesthatBeckshouldbereadforthepropositionthatthetermmembershipdoesnotextendtothosewhopayonlyRepresentationFees. (WedefineRepresentationFees tobe those feesgermane tocollective bargaining, contract administration, and grievance adjustment.)ThatcontradictsBeckssubstantiveholding.TheCourtheldthat8(a)(3) authorizes the exactionofonlyRepresentationFees, an interpretation thatnecessarily requires that the term membership in thatclausebereadtomeanRepresentationFees.487U.S.at76263.Itistruethat in its statement of facts, Beck distinguishes between duespayingemployeeswhochoosenottobeunionmembersandfullduespayingunionmembers.Id.at739.Butthatquirkisnotsubstantive.


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fees germane to collective bargaining, contract administration, and grievance adjustmentconstitute the financialcoreofmembershipforthepurposesofSection8(a)(3)andfor Section 14(b). Therefore, Section 14(b)s express allowance of state lawsprohibiting agreements requiringmembership in a labor organization as a condition of employmentnecessarilypermitsstatelawsprohibitingagreementsthatrequireemployees topayRepresentationFees (emphasisadded).4

In the alternative,we find compelling the fact that thepositionadvancedbytheUnionandadopted inthedissentnecessarilyentailsreading8(a)(3)asmaking14(b)superfluous.As noted above, in Beck the SupremeCourt statedthat8(a)(3)authorizes the exactionofonly those feesandduesnecessarytoperformingthedutiesofanexclusiverepresentativeoftheemployeesindealingwiththeemployeronlabormanagementissues.487U.S.at76263(citationandinternalquotationmarksomitted);seeMarquezv.ScreenActorsGuild, Inc.,525U.S.33,38 (1998) (8(a)(3)doesnotpermitunions toexactduesor fees fromemployees foractivities thatarenotgermane tocollectivebargaining,grievance adjustment, or contract administration.). In arguingthatRepresentationFeesarepermissible inall jurisdictions,4As this analysismakes clear,our conclusion is compelled inpartbyBecksholding that the term membership extends to thosewhoonlypayRepresentationFees,notsimplyby theRetailClerksdecisions.Andweareboundbythatprecedent,eveniftherulethatthetermmembershiphasbeenwhittleddowntoitsfinancialcoretoincludethosewhopayonlyRepresentationFeesdoesnotfitwiththeordinarymeaningofthetermmembership,asthedissentstates.


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including states that havepromulgated righttowork lawsin accordancewith 14(b), theUnion is asserting that allstatesmust allowunions to negotiate the broadest, largestpossible unionsecurity arrangement permitted under 8(a)(3).Thatcantberight.

Bothof thesepointsaremorecompelling than thealternative readings of membership presented to us by thePlaintiffAppellants,whohangtheirinterpretationonseveralslenderbranches:twocontemporaneousdictionarydefinitions,andafederalstatutorydefinitionfound inadifferentstatute passed twelve years after the TaftHartleyAct. SeeThe Labor Management Reporting and Disclosure Act of1959, 29 U.S.C. 401 et seq. Not only are both of thesesourcesextraneoustothestatutewearechargedtointerpretin thiscase,but theyalsocannotalter theSupremeCourtslater construction of the term membership in the RetailClerkscasesandBeck.b. StateStatutorySchemesConcurrentwithTaft

HartleyAlsocompellingarethestaterighttoworklawsineffect

atthetimeoftheTaftHartleyActspassagein1947.AstheSupremeCourt stated inRetailClerks II, twelve states hadrighttoworklawsineffectwhenTaftHartleywasenacted:Arizona,Arkansas,Georgia,Iowa,Nebraska,Nevada,NorthCarolina,NorthDakota,SouthDakota,Tennessee,TexasandVirginia.5These laws fell into twodifferent categories.The5 State Laws Regulating UnionSecurity Contracts, 21 L.R.R.M. 66(1948).Ofthesestates,tenstatesretainthesamerighttoworkstatutorylanguagetothepresentday.ThetwoexceptionsareNevadaandTexas.

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firstbroadlydisallowedcompulsoryunionmembership.Thesecond included specific provisions outlawing compulsorypaymentofduesorfeestolabororganizations.Anexampleof a statute from the secondgroup is Iowas righttoworklaw,whichwasenactedonApril28,1947, twomonthsbeforethepassageoftheTaftHartleyAct:

Sec.1.ItisdeclaredtobethepolicyoftheStateof Iowa that no personwithin its boundariesshall be deprived of the right towork at hischosenoccupationforanyemployerbecauseofmembershipin,affiliationwith,withdrawalorexpulsionfrom,orrefusaltojoin,anylaborunion,organization,orassociation,andanycontract which contravenes this policy is illegalandvoid.[]Sec.4.Itshallbeunlawfulforanyperson,firm,association, labororganizationor corporation,orpoliticalsubdivision,eitherdirectlyor indirectly,orinanymannerorbymeansasapre

InthecaseofNevada,therewasarighttoworkprovisionineffectfrom1911to1951intheCrimesandPunishmentActof1911,whichremainedineffectuntil1951.Afteratwoyearhiatus,aformal,standalonerighttoworklawwasaddedin1953throughinitiativepetition.NevadaLegislative Counsel Bureau Office of Research Background Paper No. 7508(1975).InTexas,arighttoworklawwaspassedin1947andstyledTexasCiv.Code5207a. Itseems tohavebeenupdatedand renumbered toappearatTexasLab.Code101in1993.The1993amendmentgaverisetoTexass specific language that restrictedcompelledpaymentofduesandfeestounions.


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requisite toorconditionofemployment torequire any person to pay dues, charges, fees,contributions,finesorassessmentstoanylaborunion,laborassociationorlabororganization.

IOWACODE 736A.1, 4 (1947), renumbered as IOWACODE731.1,4(1977).

All told,of the twelvestate righttoworkstatutes ineffectin1947,morethanhalfsevenincludedlanguagesimilartoIndianasandIowasstatutes.ARK.CODEANN.113303 (1947); GA. CODE ANN. 34622 (1947); IOWA CODE731.4 (enacted 1947, renumbered 1977); NEB. REV. STAT.48217 (1947);N.C.GEN.STAT.9582 (1947);TENN.CODEANN. 501203 (1947);VA. CODE ANN. 40.162 (enacted1947, renumbered1970).Congresswaswellawareof thesestatuteswhenitdraftedSection14(b).SeeH.R.Rep.No.245,80thCong.,1stSess.34,reprintedinILegislativeHistoryoftheLaborManagement Relations Act of 1947 324 (1948) (listingstates with such statutes).As discussed above, the statedpurposeofSection14(b)wastopreservetheefficacyoflawslike thesestatutes thatallowedstates toplace restrictionsof their choosing on unionsecurity agreements, includingrestrictions on whether employees could be compelled topayduesorfeesofanykindtoaunion.66 The legislative history demonstrates that Congress drafted Section14(b)topreservetherighttoworkstatutesalreadyineffectin1947.SeeIntlUnionoftheUnitedAssnofJourneymen&ApprenticesofthePlumbing&Pipefitting Indus.,LocalUnionsNos.141,229,681,&706v.NLRB,675F.2d 1257, 1273 (D.C.Cir. 1982) (Mikva, J.,dissenting) (The best evidenceofcongressionalintentmaythereforelieinthekindsof compulsoryunionismthatmembersofCongressunderstoodhadbeenbanned

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Presently, twentyfourstateshavesome formofarighttowork law.7Theoverwhelmingmajorityof jurisdictionseighteen,byourcount,includingGuamhaveadoptedlanguagesubstantiallyidenticaltotheprohibitioninInd.Code2268(2).SeeALA.CODE25734(1953);ARK.CODEANN.113303 (1947); GA. CODE ANN. 34622 (1947); IDAHOCODE ANN. 442003(3) (1985); 22 GUAM CODE ANN. 4103(3) (2000); IOWA CODE 731.4 (transferred 1977); LA.REV.STAT.ANN.23:983(1976);MICH.COMP.LAWS423.17(2013);MISS.CONST.art.7,198A(1960);NEB.REV.STAT.48217 (1947);N.C.GEN.STAT.9582 (1947);OKLA.CONST.art.23,1A (2001);S.C.CODEANN.41730 (1954);TENN.CODEANN.501203(1947);TEX.LAB.CODEANN.101.004(1993);UTAHCODEANN.343410(1955);VA.CODEANN.40.162 (1947); WYO. STAT. ANN. 277111 (1963); see alsoN.D. CENT. CODE 340114.1 (1987), repealed by NLRB v.NorthDakota,504F.Supp.2d750(D.N.D.2007).Thelongevityofmanyofthesestatutes,coupledwiththelackofdisapprovalexpressedbytheSupremeCourt,suggeststousthatIndianas righttowork law falls squarelywithin the realmofacceptablelaw.

We also findpersuasive adecisionby theD.C.Circuit,theonlydecisionfromasistercircuittosquarelyaddresstheby thestaterighttowork laws.).Yet thedissentspositionnecessarilyentailsconcluding thatCongressdidnot intend14(b)sprotections toextendtothemajorityofrighttoworkstatutesthenineffect.Thatisnotareasonableinterpretationoflegislativehistory.7NationalConferenceofStateLegislatures,RighttoWorkResources,available at http://www.ncsl.org/research/laborandemployment/righttoworklawsandbills.aspx(lastaccessedAug.20,2014).


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question before us.8 Facedwith the question ofwhether aunioncouldassessnonunionemployeesforRepresentationFees infourrighttoworkstates,theD.C.Circuitfound,onthe basis of the legislative history of the TaftHartleyAct,that theassessmentofsuch feesconstitutedanunfair laborpractice. Journeymen&Apprentices,675F.2dat126062.TheD.C.Circuitheld thatCongressknewpreciselywhatstatelaws it was validating when it passed 14(b) as [t]heHouseReportlistedeachstatewhichhadpassedarighttoworklaworconstitutionalprovision.Id.at1260.Specifically,theD.C.CircuitwaspersuadedthatCongressalsoknewabout the free rider problem posed by such lawswhen itsanctioned such laws by passing 14(b), as shown by acommentintheSenateCommitteereportonthebillreflect8Thedissentcitestwocircuitdecisionsthatstandfortheprinciplethat14(b)doesnotauthorize states toprohibit theuseofexclusivehiringhalls that do not discriminate between union members and nonmembers.SeeLaborersIntlUnionofN.Am.,LocalNo.107v.Kunco,Inc.,472 F.2d 456 (8thCir. 1973);NLRB v.HoustonChapter,AssociatedGen.ContractorsofAm., Inc.,349F.2d449 (5thCir.1965).BothdecisionsprecedeBeckanddidnothave thebenefitof theCourts interpretationofmembership in that case.And theD.C.Circuit, in Journeymen&Apprentices, foundboth casesclearlydistinguishable from thematterathandonthebasisthattheseconcernprehiringpractices,whereas14(b)applies to posthiring union security arrangements. Journeymen&Apprentices,675F.3dat1262,1267(Useofaunionhiringhallprecedeshiringandthereforedoesnotconstitutemembershipunder14(b).).Weagreethatthesecasesaredistinguishablebecausehiringhallsdonotrequireprospectiveemployeestodoanythingmorethantemporarilyvisitunionfacilitiesduringthehiringprocess.Suchtemporaryaffiliationdoesnotamount tomembershipas that termhasbeen interpretedby theSupremeCourt.


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ingunions concerns about free riders,9 aswell as SenatorTaftsrebuttalonthatpointthat[m]anystateshaveenactedlawsoradoptedconstitutionalprovisionstomakeallformsof compulsoryunionism in such states illegal.As stated inthe report accompanying the Senate committee bill, itwasnot the intent to deprive the States of such power. Id. at126061 (citationomitted).And theD.C.Circuitnoted thatthisproblemwassowellknownthatPresidentTrumancriticizeditinhisvetomessage.Id.at1261.

PlaintiffAppellants are right that Congress was concerned that banning the closed shop would create a freeriderproblem,butonlyinthosestatesthathadnoadditionalrestriction on unionsecurity agreements. Id. at 1260([L]eadersoforganized laborhavestressedthefactthat in9A controversial issue towhich the committeehasdevoted themostmaturedeliberationhasbeen theproblemposedbycompulsoryunionmembership. [A]buses of compulsorymembershiphave become sonumeroustherehasbeengreatpublicfeelingagainstsucharrangements.Thishasbeenreflectedbythefactthatin12Statessuchagreementshavebeenmade illegaleitherby legislativeactorconstitutionalamendment,and in14otherStatesproposals forabolishing such contractsarenowpending.Althoughtheseregulatorymeasureshavenotreceivedauthoritative interpretationby theSupremeCourt (citationomitted) it isobvious that theypose importantquestionsofaccommodatingFederalandState legislation touching labor relations in industries affecting commerce (citationsomitted). In testifyingbefore thiscommittee,however,leadersoforganized laborhavestressed the fact that in theabsenceofsuchprovisionsmanyemployeessharingthebenefitsofwhatunionsareabletoaccomplishbycollectivebargainingwillrefusetopaytheirshareofthecost.Journeymen&Apprentices,675F.2dat1260(citingReportoftheSenateCommitteeonLaborandPublicWelfarepresentedbySenatorTaft,80thCong.,1stSess.6,April17,1947).


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the absence of [antiunionsecurity] provisions many employees sharing thebenefitsofwhatunionsareable toaccomplish by collective bargaining will refuse to pay theirshareof thecost.) (quoting theReportof theSenateCommittee on Labor and Public Welfare presented by SenatorTaft, 80thCong., 1st Sess. 6,April 17, 1947).On the otherhand,Congress explicitly permitted states that did restrictthoseagreementstofindtheirownsolutiontothefreeriderproblem, if itwasaproblem inthosestates.Indeed,unionscontinuetothriveandassertsignificantinfluenceinseveralrighttowork states, including Iowa,10 where provisionsequivalenttoIndianashavebeenineffectformorethansixtyfive years. If the PlaintiffAppellants believe that Indianaslawwillcreateaneworunexpectedlyseverefreeriderproblem,theymayaddressthoseconcernstoCongress.

In sum, in reviewing this substantialbody of empiricalevidence, we are not persuaded by PlaintiffAppellantsclaims that Indianas law is somehow an extraordinarymeasuredistinctfromthenumerousstatestatutesthathaveharmoniously existed under the federal labor law framework.Nor arewepersuaded by their assertions that Indianaslawrepresentsamortalthreattothecontinuingexistenceofunionsasprovidedunderfederallaw.Section8(2)of10 See, e.g.,KrisMaher, IowasHouse of Labor is Split,WALL ST. J.(Nov.20,2007)atA6 (examining the importanceofbig,politicallyactive unions in the Iowa caucus vote); Steven Greenhouse, SecretWeapon inGoreCamp:Unions in Iowa,N.Y.TIMES (Jan.17,2000)atA14, available at http://www.nytimes.com/2000/01/17/us/the2000campaigntheunionssecretweaponingorecampunionsiniowa.html(calling Iowas 150,000member union force a major weapon in theIowacaucuses)(lastaccessedAug.20,2014).


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the Indiana righttowork statute is thusnotpreemptedbytheNLRA.c. PlaintiffAppellantsMiscellaneousPreemptionAr

gumentsPlaintiffAppellants assert two other preemption argu

ments.Bothdeserveonlyquickconsideration.The first assertion, that federal labor law preempts the

Indiana lawscriminalpenalties, clashes squarelywith language in Retail Clerks II, where the Supreme Court statedthat

Inlightofthewordingof14(b)andthislegislative history, we conclude that Congress in1947didnotdeprive theStatesofanyandallpowertoenforcetheirlawsrestrictingtheexecution and enforcement of unionsecurityagreements.Since it isplain thatCongress lefttheStates free to legislate in that field,wecanonlyassumethatitintendedtoleaveunaffectedthepowertoenforcethoselaws.

RetailClerksII,375U.S.at102.TheUnionssecondargumentisthattheNLRApreempts

8(3)of thestatute,whichbarsmandatorypaymentsofanamountequivalent touniondues toacharity.Theyrelyon19 of theNLRA,which allows conscientious objectors topayduestoacharityratherthantoaunion.Buttheapplicabilityofthatsectionnaturallypresupposestheexistenceofaunionsecurityagreementthatrequiresthepaymentofdues.And aswe have demonstrated, states are permitted to restrictorprohibitsuchagreements.Weagreewiththedistrictcourts assessment that [n]othing in the language of 19


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suggests or supports interpreting it as an exemption to14(b) thatwouldpreemptanystateattempt tooutlaw thekindofprovisionthat19permits.Sweeneyv.Daniels,2013WL209047,*11(N.D.Ind.Jan.17,2013).2. FederalConstitutionalClaimsThedissent claims thatour interpretationof the federal

statutoryschemaworksanunconstitutionaltakingonHoosier unions. We consider this argument first. PlaintiffAppellants also allege violations of the Contracts, Ex PostFacto, and Equal Protection Clauses of the United StatesConstitution.BecauseboththeirContractsandExPostFactoClauseargumentshave forceonly if thestatuteappliesretroactively,weconsiderthemtogether.a. IndianasLawDoesNotWorkanUnconstitutional

TakingThedissentassertsthat,shouldwehold thatthefederal

statutory schemedoesnotpreempt Indianas righttoworkstatute,thatholdinglikelyviolatestheTakingsClauseoftheFifthAmendment,asapplied to the statesunder theFourteenth Amendment. Dissent at 1718. We observe that noargumentbasedontheTakingsClausewasadvancedbytheUnion,andsoanysuchargumentwas forfeited.See Jacksonv.Parker,627F.3d634,640(7thCir.2010)(notingthatargumentsnotraisedbefore thedistrictcourtare forfeited);Trs.ofChi.Painters&DecoratorsPension,Health&Welfare,&DeferredSav.PlanTrustFundsv.Royal IntlDrywall&Decorating, Inc.,493F.3d782,790 (7thCir.2007) (noting thatarguments not raised in the opening brief are forfeited). Andthere is the problem of whether the Union has sued theproper defendants for the purposes of advancing a claim


No.131264 21

under theTakingsClause.TheUnionsallegeddeprivationistheproductoffederallawandtheIndianastatuteoperatingintandem.Becauseitisfederallawthatprovidesadutyof fair representation, Indianas righttowork statute doesnottakepropertyfromtheUnionitmerelyprecludestheUnionfromcollectingfeesdesignedtocoverthecostsofperformingtheduty.EvensupposingtheUnioncouldjustifyitssuitbyinvokingsomethinglikethetortdoctrineofconcurrentactualcauses,11thedissenthasnotexplainedwhytheproper remedywouldbe tostrikedown Indianas righttowork statute rather than striking down or modifying thefederallawimposingonallunionsthedutyoffairrepresentation, in righttowork states and nonrighttowork statesalike.

Even so,we engagewith thedissentspositionbecausewe believe it overlooks the fundamental fact that distinguishes the unions duty of representation from the otherhypotheticalsitpresents.Thatistosay:webelievetheunionisjustlycompensatedbyfederallawsgranttotheUniontheright tobargain exclusivelywith the employer.The reasontheUnionmust represent all employees is that theUnionalone gets a seat at the negotiation table. See IntlAssn ofMachinistsv.Street,367U.S.740,761(1961)(Aunionsstatusasexclusivebargainingrepresentativecarrieswithittheduty fairlyand equitably to representall employeesof the

11 See Hill v. Edmonds, 26 A.D.2d 554, 55455 (N.Y. App. Div. 1966)(Whereseparateactsofnegligencecombinetoproducedirectlyasingleinjuryeachtortfeasorisresponsiblefortheentireresult,eventhoughhisactalonemightnothavecausedit.).


22 No.131264

craft or class,union andnonunion.);HughesToolCo., 104N.L.R.B. 318, 32425 (1943) ([A] union could not assessnonmembersforcostsarisingfromcontractnegotiationsforthelatteraretheexclusivedutyandprerogativeofthecertified representativewhich thenonmemberminority isbothentitled toandboundunder.).Thepowersof thebargainingrepresentativearecomparable to thosepossessedbyalegislativebodybothtocreateandrestricttherightsofthosewhom itrepresents.Steelev.Louisville&N.R.Co.,65S.Ct.226,232(1944).Thedutyoffairrepresentationisthereforeacorrespondingduty imposed inexchange for thepowersgranted to theUnion as an exclusive representative. Id. Itseemsdisingenuousnot torecognize that theUnionspositionasasolerepresentativecomeswithasetofpowersandbenefitsaswellasresponsibilitiesandduties.Andnoinformation before us persuades us that theUnion is not fullyandadequatelycompensatedbyitsrightsasthesoleandexclusivememberatthenegotiatingtable.b. ContractsandExPostFactoClauseArgumentsTheContractsClauseprovides that [n]o State shall

passanylawimpairingtheObligationofContracts.U.S.CONST.art.I,10,cl.1.AstateviolatestheContractsClausewhen a change in state lawhas operated as a substantialimpairmentofacontractualrelationship.Gen.MotorsCorp.v.Romein,503U.S.181,186(1992)(citationandinternalquotationmarksomitted).The relevant inquiryhas three components: 1) whether there is a contractual relationship;2)whetherachangeinlawimpairsthatcontractualrelationship;and3)whether the impairment is substantial.Council31oftheAm.FednofState,Cnty.,&Mun.Emps.v.Quinn,680F.3d875,885(7thCir.2012)(citingKhanv.Gallitano,180F.3d


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829,832(7thCir.1999)).TheExPostFactoClauseisviolatedbystateorfederallegislationthatmakesanactdonebeforethepassingofthelaw,andwhichwasinnocentwhendone,criminal,andpunishes suchaction.Peughv.UnitedStates,133S.Ct.2072,2081 (2013) (citationand internalquotationmarksomitted).ThepartiesagreethatfortheIndianalawtoviolatetheseclausesoftheConstitution,the lawmusthavesome retroactive application: it must either impair an alreadyexistingcontractorelsepunishpastconduct.Wefindthatthelawdoesnotapplyretroactively.

ThisconclusionisrelativelyeasytoreachbecauseSection13oftheIndianastatuteprovidesthatthesubstantiveprovisionsof the legislationSections8 through12applyonlyto contractsentered intoafterMarch14,2012,anddonotapplytoorabrogateawrittenororalcontractoragreementineffectonMarch14,2012.IND.CODE226613.ThemainobjectionPlaintiffAppellantsmakehereistoSection3ofthestatute.TheyarguethatSection3 isasubstantiveprovisionnotmentionedinSection13,andthatitthushasretroactiveapplication.

Ininterpretingthelanguageofastatute,wemustexaminethelanguageanddesignofthestatuteasawhole.WellsFargoBank,NatlAssnv.LakeofTorchesEcon.Dev.Corp.,658F.3d684,694(7thCir.2011)(citationsandinternalquotationmarksomitted).Andwemustalsokeepinmind[t]hepresumptionagainst retroactive legislation,whichembodiesa legaldoctrinecenturiesolder thanourRepublic.Vartelasv.Holder,132S.Ct.1479,1486 (2012) (citationand internalquotationmarksomitted).WeareinclinedtoagreethatSection3isanoddlydraftedprovision.Itresidesinaneighborhood of prefatory clauses, nestled amid definitions of key


24 No.131264

termsandexceptions,butitssubsectionsappearsurprisinglysubstantive:indeed,Section3ssubprovisionsareidenticalincontenttothesubsectionsofSection8.However,Section3smainclauseisdraftedinthelanguageofexception.Itexplainsthatthestatuteshouldnotbereadtochangethelawsof thebuildingandconstruction industry,an industrythathasitsownsetofelaboratelaborlaws,excepttoprohibitagreementsofthetypebannedbySection8.Itisadoublenegativeno change except the following changesthatwouldbemorecomprehensibleifdraftedinthepositive,butthe placement of the clausemakes sense among the otherprefatory,exclusionaryclauseslikeSections1(Thischapterdoesnotapply to the following:.)and2 (Thischapterdoesnotapplytotheextentthat.).IND.CODE22661,2.Inlightofthedesignofthestatuteasawhole,wearesatisfied that the provision in question is prefatory, not substantive. It simply explains thedomains towhich the substantiveportionsofthestatuteapply.TotheextentthatSection 3 contains substantive language, it is language thatsimplypointstothelatersubstantivesectionsoutlawingunionsecurityclauses.Thisreadingbestharmonizesthestructureof the statuteand thepresumptionagainst retroactivelegislation.1212Insupportofourreading,DefendantAppelleesassertthefactthattheIndianaCommissionerofLaborhasdisclaimedanyretroactiveinterpretationofSection3,butthisisnotpersuasive.Whilethedistrictcourtwassatisfied by theCommissioners declaration, terming it binding undertheprinciplesof judicialestoppel,itisdifficulttodeterminewhateffectsuch declarations would have on future executive administrations orofficeholders.ButourreadingofthestatuteconvincesusthatSection3isnotretroactive,soweneednotrelyontheconceptofestoppel.


No.131264 25

c. EqualProtectionClauseArgumentsTheEqualProtectionClause of theFourteenthAmend

mentstatesthatnostateshalldenytoanypersonwithinitsjurisdiction the equal protection of the laws.U.S. CONST.amend.XIV.Equalprotectionscrutiny istriggeredwhenaregulationdrawsdistinctionsamongpeoplebasedonapersonsmembershipinasuspectclassorbasedonadenialofafundamentalright.Srailv.Vill.ofLisle,Ill.,588F.3d940,943(7thCir.2009)(citationsomitted).Ifeitherasuspectclassorfundamentalright isimplicated,thegovernments justificationfortheregulationmustsatisfythestrictscrutinytesttopassmusterundertheEqualProtectionClause.Id.Butifneitherconditionispresent,theproperstandardofreviewisrationalbasis.Id.

PlaintiffAppellantsarguethattheIndianaRighttoWorkActviolatestheEqualProtectionClauseintwoways:(1)because it allows free riders to infringe on union membersFirstAmendment free speech rights, and (2) because it allows free riders to infringeon the rightofunionmembership,which is a fundamental right because it involves theexercise of First Amendment association and assemblyrights.Weholdthatthe lawdoesnotviolatetheequalprotection clause because itdoesnot implicate a fundamentalright,anditpassesthelowbarofrationalbasisreviewwithease.

i. FirstAmendmentFreeSpeechRightsThestrongerofPlaintiffAppellantstwoequalprotection

argumentsistheassertionthatnonpayorsofRepresentationFees will be freeriders who siphon valuable Union resourcesawayfromtheUnionspoliticalactivities.Indimin


26 No.131264

ishingthe financialresourcesavailabletotheUnionforpoliticalspeech,PlaintiffAppellantsargue,theIndianalawinfringeson theUnionsFirstAmendment freespeechrights.We agree that unions have the right under the FirstAmendment to express their views on political and socialissues without government interference. Knox v. Serv.Empls.IntlUnion,Local1000,132S.Ct.2277,2295(2012).

However,PlaintiffAppellantsargument isundercutbythreelongstandingprinciples.First,theSupremeCourthasstatedthatunionshavenoconstitutionalentitlementtothefees of nonmember employees.Davenport v.Wash. Educ.Assn,551U.S.177,185(2007).Andmorerelevantly,theFirstAmendmentprotectstherighttobefreefromgovernmentabridgementofspeech,butitdoesnotrequire[]thegovernmenttoassistothers in funding theexpressionofparticular ideas, including political ones. Ysursa v. PocatelloEduc. Assn, 555 U.S. 353, 358 (2009). Stated another way,althoughgovernmentmaynotplaceobstaclesinthepathofapersonsexerciseoffreedomofspeech,itneednotremovethosenotofitsowncreation.Reganv.TaxationWithRepresentationofWash.,461U.S.540,54950(1983)(internalquotationmarksandcitationsomitted).ItmaybetruethattheUniondoesnothavemoneyasitwants,andthuscannotexerciseitsfreedomasitwouldlike,buttheConstitutiondoesnotconferanentitlementtosuchfundsasmaybenecessarytorealizealltheadvantagesofthatfreedom.Id.at550(internal quotation marks and citations omitted). A legislaturesdecisionnottosubsidizetheexerciseofafundamentalrightdoesnot infringe the right,and is thusnot subject tostrict scrutiny. Ysursa, 555U.S. at 358 (internal quotationmarksandcitationsomitted).


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TheUniondoesnotassert that the Indianastate legislaturehastakenawayanassettowhichtheUnionwasconstitutionallyentitled.Viewed in thebestpossible light, itsargumentisthatIndianahasmadeitmoredifficultfortheUnion to collectasmany fundsas it isused to collecting.ButIndiana,likethestateofIdahoinYsursa,isundernoobligation to aid the unions in their political activities.And theStatesdecisionnottodosoisnotanabridgementoftheunionsspeech;theyarefreetoengage insuchspeechastheyseefit.Id.at359.

Lastly,asunderscoredarecentcaseconcerningwhethernonunion public employees could be compelled to payagencyfeestoastatedesignatedunion,theSupremeCourthasheldthatthereisacompetingFirstAmendmentinterestatplaywith freeriderargumentsof thisvariety:theFirstAmendment interestsof thosewhodonotwish to supporttheunion.Harrisv.Quinn,134S.Ct.2618,2643(2014).It reaffirmed that [a]gencyfee provisions unquestionablyimposeaheavyburdenontheFirstAmendmentinterestsofobjectingemployees. Id.Andfreeriderargumentsaregenerally insufficient to overcomeFirstAmendment objections.Id.at2657.

Inpassing its righttowork legislation, Indianadid notabridgetheUnionsspeech,andthusdidnotviolateitsFirstAmendment right to free speech. Rational basis review isproperforthisequalprotectionclaim.

ii. FundamentalRightofUnionMembershipAppellantsweakerargument is theassertion that there

existsafundamentalrightofunionmembership.Collectivebargaining isnotafundamentalright,andaunionand its


28 No.131264

membersarenotsuspectclasses.Univ.Proflsof Ill.,Local4100v.Edgar,114F.3d665,667(7thCir.1997);seealsoCityofCharlottev.Local660, IntlAssnofFirefighters,426U.S.283,286(1976)([T]hiscourtwouldrejectsuchacontentionifitweremadethatrespondentsstatusasunionmembersissuchastoentitlethemtospecialtreatmentundertheEqualProtectionClause.).SinceweagreewiththeTenthCircuitsassertionthatneitherunionnornonunionstatusimplicatesafundamentalrightorconstitutesaprotectedclass,Local514v.Keating,358F.3d743,754(10thCir.2004),weoptfor rationalbasis reviewunlessPlaintiffAppellants canassert a cognizable fundamental right thathas been violatedbytheIndianastatute.

PlaintiffAppellants claim that they never asserted thatunionmembersareasuspectclass.Instead,theytrytocobbleabrandnewfundamentalrighttounionmembershipoutof the fact that union membership implicates the FirstAmendmentrightsof freedomofassemblyand freedomofassociation. But besides being intellectually threadbareconsider, for example, that these same facts couldbemarshalled to support a fundamental right toCivilWar reenactmentthislineofreasoningwasrejectedbytheSupremeCourtlongago.UnionmembersinNorthCarolinaandNebraskamade thesameargumentwhen theychallenged thetwostatesrighttoworklawsinthelate1940s.Theyasserted,interalia,thattheirfreedomofassociationandassemblywas infringed. In Lincoln Federal LaborUnionNo. 19129, v.NorthwesternIron&MetalCo.,theSupremeCourtstated:

There cannot bewrung from a constitutionalright of workers to assemble to discuss improvementof theirownworking standards,a


No.131264 29

further constitutional right to drive from remunerativeemploymentallotherpersonswhowillnotorcannot,participateinunionassemblies.Theconstitutionalrightofworkerstoassemble,todiscussandformulateplansforfurtheringtheirownselfinterestinjobscannotbeconstrued as a constitutional guarantee thatnoneshallgetandhold jobsexceptthosewhowill joinintheassemblyorwillagreetoabidebytheassemblysplans.Forwhereconductaffects the interestsofother individualsand thegeneral public, the legality of that conductmust be measured by whether the conductconforms to valid law, even though the conduct isengaged inpursuant toplansofanassembly.

335U.S.525,531(1949).There is no doubt that union workers enjoy valuable

rightsofassociationandassemblythatareprotectedbytheFirstAmendment. See, e.g., Thomas v. Collins, 323U.S. 516(1945).ButasinLincolnFederal,thatrightalonecannotoperateasanoffensiveweapontowrestrightsfromothers:here,theHoosierworkerswhose rightsnot toassociatewith theunionareprotectedby thenew legislation.See, e.g.,Harris,134S.Ct.at2643(notingtheFirstAmendmentinterestsofthosewhodonotwishtosupporttheunion);Knox,132S.Ct.at2289(holdingthatcompelledmembershipinapublicsectorunion,whichtakespositionsduringcollectivebargaining that can have powerful civic and political consequences,canconstituteaformofcompelledspeechandassociation that imposes a significant impingement on First


30 No.131264

Amendment rights (citation and internal quotationmarksomitted)). PlaintiffAppellants must thus make a greatershowing:aclearbasis forhow the lawswillexpressly forbidthefullexerciseofthoserightsbyunionorunionmembers, Lincoln Federal, 335 U.S. at 530, or even a plausibledemonstration of how allowing nonunionworkers to notpayRepresentationFeeswillsomehowweakenthebondsoftheunionsownassociationandassembly.Theyhavefailedtodo sohere.Rationalbasis review is appropriate for thisequalprotectionclaimaswell.

iii. TheStatutePassesRationalBasisReviewStatutesthatdonotencroachonafundamentalrightare

reviewedwithconsiderabledeference.SeeUnitedStatesv.Moore, 644 F.3d 533, 555 (7thCir. 2011). The pertinent inquiry iswhetherthestatute inquestionbearsareasonablerelationtoanyproperlegislativepurpose.Id.at55556.Itisnotour task todiscern thespecific intentof the legislature,buttodetermineifanyproper legislativepurposeisservedbyIndianaslaw.

Thedistrict courts analysison thispoint is apt.As thecourt stated, [a] belief that the passage ofRight toWorklegislation contributes to a businessfriendly environmentthat can attract companies and encourage job growthprovides a legitimate governmental objective that may havebeen(andwasinfactclaimedtobe)areasonforthepassageof IndianasRight toWork legislation. Sweeney, 2013WL209047 at *8.Weneed lookno further for a rationalbasis.The Indiana law does not violate the PlaintiffAppellantsrighttoequalprotection.


No.131264 31

IIIWe noted at the outset that this legislation prompted

vigorousdebate,both inthegeneralpublicandtheIndianaStatehouse. But the legislative history and context of theTaftHartleyActmakeclearthatthecontroversyisonethatoughttobeaddressedandresolvedattheleveloflegislativepolitics, not in the courts. The statutory question posed iswhether Indianas new law is preempted by federal laborlaw,or threatens theUnionsFirstAmendment rights.Theanswerisanemphaticno.RighttoWorklawslikeIndianashaveexistedsincebeforethepassageoftheTaftHartleyActand the inclusion of Section 14(b) of theNLRA.Congressspecificallyreservedtothestatesthepowertowriteandenforce laws of this nature, in accordance with individualstatesneedsandwisdom.Itisnotourprovincetowrestthisauthority,which has been intact andundisturbed for oversixtyfiveyears,fromthestatesanderasethedistinctionbetweenrighttoworkstatesandnonrighttoworkstates.

Fortheforegoingreasons,weAFFIRMthedistrictcourtsjudgment.


32 No.131264

WOOD,Chief Judge,dissenting.Todaysdecision iseitherincorrectoritlaysbareanunconstitutionalconfiscationperpetuatedbyourcurrentsystemoflaborlaw.Inmyview,thebetterviewistheformer:themajorityhassimplymisunderstood the federal statutory scheme, taken as awhole. Theplain languageof section14(b)of theNationalLaborRelationsAct(NLRA)doesnotsupportsuchsweepingforceforIndianasRight toWork law.IND.CODE2266.Norulingof theSupremeCourthasgone this far,and the legislativehistoryofsection14(b)(forthosewhoconsideritrelevantatall)isinconclusive.Evenif,however,onethoughtthatthereweresomeambiguityintheNLRA,theprincipleofconstitutional avoidance provides a powerful reason to reject themajoritysholding.Iwouldfindsections8(2)and8(3)ofIndianas statute, Ind. Code 22668(2), (3), preempted byfederalstatute.Ithereforerespectfullydissent.

IIt is impossible tounderstandwhat isatstakeandwhy

themajoritysresolutionisinerrorwithoutabriefreviewofthe labor law regime in theUnited States. Inaugurated in1935with thepassageof theWagnerAct, 49Stat. 452, theNLRAreliesonasystemofexclusiverepresentationofbargainingunitemployees.See29U.S.C.159(a).That is, ifamajorityoftheemployeesinadefinedsectionofaworkforcevote in favor of aparticularunion to represent them, thatunion isrequiredby lawtorepresentalltheworkers inthebargaining unitsupporters and nonsupporters, membersand nonmembers, alike. Id.; see IntlAssn ofMachinists v.Street,367U.S.740,76061(1961)(aunionsstatusasexclusivebargainingrepresentativecarrieswithitthedutyfairlyandequitablytorepresentallemployeesofthecraftorclass,


No.131264 33

union and nonunion). (This is hardly an unfamiliar arrangement in ademocracy.Even after themosthotly contestedpresidentialelection, thepersonwho isdeclared thewinnerbecomesthePresidentforallcitizens,not justthosewhovotedforhimorher.)Thereisnothinginevitableaboutour systemof labor law; it canbe contrastedwithahypotheticalregime that ismoreprotectiveofminorityormembersonlyunions,underwhichemployeeswhowanttobargaincollectivelymightbe free to formamembersonlyunion and interactwith their employer on that basis.But, torepeat, that is not the system that the United States hasadopted.

Consequencesflowfromtheunionsstatusastheexclusive representative of all members of the bargaining unit.Themostsignificantiswhatisknownasthedutyoffairrepresentation. SeeSteele v.Louisville&N.R.Co., 323U.S. 192(1944)(recognizingthedutyoffairrepresentationundertheRailwayLaborAct);FordMotorCo.v.Huffman,345U.S.330,33738 (1953) (extendingduty of fair representation to theNationalLaborRelationsAct).Thedutyof fair representationrequirestheexclusivebargainingrepresentative(i.e.,theunion)toservetheinterestsofallmembers[ofthebargainingunit]withouthostilityordiscrimination towardany, toexerciseitsdiscretionwithcompletegoodfaithandhonesty,and toavoidarbitraryconduct.Vacav.Sipes,386U.S.171,177 (1967).Thisduty isnot limited to thenegotiationprocess; it covers allunion representational activity. See id. at19091(dutyoffairrepresentationextendstogrievanceandarbitration);AirLinePilotsAssn,Intl.v.ONeil,499U.S.65,67 (1991) (Wehold that theruleannounced inVacaappliestoallunionactivity .).TheSupremeCourtsopin


34 No.131264

ioninAboodv.DetroitBd.ofEduc.,431U.S.209(1977),summarizedthescopeofthosedutieswell:

Thedesignationofaunionasexclusiverepresentativecarrieswith itgreat responsibilities.The tasksofnegotiating and administering a collectivebargainingagreementand representing the interestsof employeesinsettlingdisputesandprocessinggrievancesarecontinuing and difficult ones. They often entail expenditureofmuch timeandmoney.The servicesof lawyers, expertnegotiators, economists,anda researchstaff,aswellasgeneraladministrativepersonnel,mayberequired.Moreover,incarryingouttheseduties, the union is obliged fairly and equitably torepresent all employees , union and nonunion,withintherelevantunit.

Id.at221(internalcitationandquotationmarksomitted).As thispassageacknowledges,amajorpartof thework

assigned tomostunionsundercollectivebargainingagreements relates to the administrationof thegrievanceprocedure.Grievingandarbitratingclaimsisnotcheap.ThewebsiteoftheTeamstersunioninformsitsmembersthat78%oftheirduesstaywithyourlocalunionforavarietyofpurposes,includingtheretentionof[a]ttorneystoassistinnegotiations, grievances, and arbitration. Seehttp://teamster.org/about/frequentlyaskedquestionsfaq#faq06 (this and all otherwebsites cited in this opinionwere last visited August 29, 2014). The Labor ArbitrationRulesof theAmericanArbitrationAssociation,availablebyfollowing the links in the Rules & Procedures tab athttp://www.adr.org, outline a comprehensive process thatobviouslycosts realmoney. It isnostretch toestimate that


No.131264 35

thecostofpursuingmanygrievancesfrominitialinvestigationthrougharbitrationcanreachintothethousandsofdollars,representing the timeoftheaffectedemployeeandhisunion representative, witness and travel costs, arbitratorfees,and thecostofoutside legalcounsel.Thedutyof fairrepresentation requires the union to absorb these costswhetherornottheaggrievedemployeeisaunionmember.

Notethesignificantasymmetryembeddedinthissystem.While theunion is required to representallpersons in thebargainingunitfairlyandequally,eachoneofthesepeopleisentitledtodecidewhethertobecomeamemberoftheunion.Thosewhoopttobecomememberswillpaytheiruniondues,whichcoverbothactivitiessuchascollectivebargaining,contractadministration,andgrievances(towhichIreferasrepresentationalactivities)andavarietyofancillarypoliticalorideologicalactivities(towhichIreferasancillaryactivities).Butwhatofthosewhochoosenottobecomemembers?Ithasbeenestablishedforyearsthattheymaynotbecompelledtopayfortheancillaryactivities,nomatterwhatthe labelplacedon thatpayment.SeeCommcnsWorkers ofAm.v.Beck,487U.S.735,738(1988).Soanyquestionofcompellingsupportforspeechwithwhichthenonmemberdisagreesisoffthetable.

Untilnow,however,reimbursementforthebenefitsthattheunionmustconferonthenonmemberhasbeenadifferentmatter,andforgoodreason.Ifthereisnowaytocompelthenonmemberemployee topay theactualcostof theservices the union is obligated to provide for him, a classicfreeriderproblemarises.Freeriding isapotentialproblemwheneveracollectivegood (suchas theunionserviceshere)isinvolved.Ifthegood(orservice)canbepricedindi


36 No.131264

vidually(thatis,thesellercanensurethatonlythebuyerobtains the benefit), freeridingwill not be aproblem.But ifeachpersoninthegroupobtainsthebenefitofthecollectivegoodwhetherornotshepaysforit,thenthereisariskthatthesupplyofthegoodwilldiminish,orinthelimitingcasewill disappear altogether. See generally Earl R. Burbaker,FreeRide,FreeRevelation,orGoldenRule?18J.L.&ECON.147,149150 (1975);RussellB.Korobkin&ThomasS.Ulen,LawandBehavioralScience:RemovingtheRationalityExceptionfromLawandEconomics,88CALIF.L.REV.1051,1139(2000).Thus,forexample,therealizationoftheriskoffreeridingbydistributorswhodidnotwant toprovide services thatmanufacturers valued led antitrust law to change from a per seprohibition of vertical restraints to a ruleofreason approach.SeeContlT.V.,Inc.v.GTESylvania,Inc.,433U.S.36(1977); LeeginCreative Leather Prods., Inc. v. PSKS, Inc., 551U.S.877(2007).Inoursituation,thenonmemberoftheunionwillreapthebenefitsofbeingrepresentedbytheunionduring a grievance, for instance, but he will pay nothing forthose benefits, which might include a lay representative,maybeevena lawyer, investigativeservices,andsoonallthingsthatcosttheunionrealdollarstoprovide.Inshort,hewill takeafreerideon thedues that theunionmembersmaketotheunion.

Thesameproblemarises inaunionizedworkplace(thatis,aworkplace inwhichamajorityof theemployeeshavevotedtohaveaunionrepresentthem, inanelectionsupervisedbytheNationalLaborRelationsBoard,orNLRB).Becauseallmembersofthebargainingunitbenefitasamatterof right from theunions representationalactivities regardlessofwhetherthey jointheunion,thereisanincentiveforemployeesinthebargainingunittorefusetocontributeto


No.131264 37

theunionwhile obtaining benefits ofunion representationthatnecessarilyaccrue toallemployees.Abood,431U.S.at222.Thebenefitsinthiscase,asinmost,extendwellbeyondtheboostfromunionspeechthattheSupremeCourtfoundinadequate to support a rule requiring nonmember fairsharecontributionsinHarrisv.Quinn,134S.Ct.2618,263637(2014).IdiscussHarrisinmoredetailbelow.

Thequestionisthereforewhetherthelawasitstandstodayincludesasolutiontothepotentialfreeriderproblem.Ifitdoes,bycreatingawaytorequirenonmemberstopayforactualbenefitsreceived, thenall iswell. If itdoesnot, thenissues of constitutional magnitude arise. As the SupremeCourthasrecognized,[t]ocompelemployeesfinanciallytosupport their collectivebargaining representative has animpactupontheirFirstAmendmentinterests.Id.Buttoexempt employees from reimbursing a service provider forworkperformedcreatesadifferentconstitutionalissueonethat theSupremeCourthashad little tonooccasion todiscuss.ButwecangleansomethingfromPhillipsv.WashingtonLegal Foundation, 524U.S. 156 (1998),which addressed thequestion whether interest income generated by funds inlawyerstrustaccounts(IOLTA)wastheprivatepropertyoftheclient.TheCourtheldthatitwas.Thatholdingraisedthequestionwhetherclientscouldbecompelledtodonatetheirpropertytoafoundationthatprovided legalservicestotheindigent.InBrownv.LegalFoundationofWashington,538U.S.216(2003),theCourtheldthatifthestatewishedtorequirethe clientsproperty to be transferred from the IOLTA account to the foundation, itsactionhad tobe judgedundertheTakingsClauseoftheFifthAmendment.Itheldthattheclientspropertyhadbeentakenforapublicusewhenitwas


38 No.131264

turnedover, see538U.S.at235,but thatno compensationwasdue,becausethepetitionersnetlosswaszero.Id.at240.

ThelessonfromtheIOLTAcasesforusisthatastatelawcompelling one private party to give property to anotherprivate partymust be assessed under the TakingsClause.Thefactthatthosetwocasesinvolvedmoney,whileourcaseinvolves thecompulsoryprovisionofservices, isofnomoment.(This,incidentally,showswhytheplaintiffshavesuedthe correct party: it is the Indiana law that is compellingthem todonatevaluableservices to thenonmembersof theunions, just as itwas state law in Phillips and Brown thatcompelledclientstodonatetheirmoneytothelegalfoundations.Compareanteat20.)Servicescostmoney toprovide:unionrepresentativesmustbepaid,union lawyersmustbepaid, and collective bargaining is not free. Justice ScaliaflaggedthisprobleminhisseparateopinioninLehnertv.FerrisFacultyAssn,500U.S.507(1991)(concurringinjudgmentinpart,dissentinginpart):

Wherethestateimposesupontheunionadutytodeliver services, itmaypermit theunion todemandreimbursementforthem;or,lookedatfromtheotherend,where thestatecreates in thenonmembersa legalentitlementfromtheunion,itmaycompelthemtopaythecost.Thecompellingstateinterestthatjustifies this constitutional rule isnot simplyeliminationof the inequityarising from the fact thatsomeunionactivityredounds to thebenefitoffreeridingnonmembers;private speech often furthers the interestsofnonspeakers,andthatdoesnotaloneempowerthestatetocompelthespeechtobepaidfor.Whatisdistinctive, however, about the free riders who are


No.131264 39

nonunion members of the unions own bargainingunitisthatinsomerespectstheyarefreeriderswhomthe lawrequires theunion tocarry indeed,requirestheunion togo out of itsway tobenefit, evenat theexpense of its other interests. In the context of bargaining,aunionmustseek to further the interestsofitsnonmembers;itcannot,forexample,negotiateparticularlyhighwage increases for itsmembers in exchangeforacceptingnoincreasesforothers.Thus,thefreeridership(ifitwerelefttobethat)wouldbenotincidental but calculated, not imposed by circumstancesbutmandatedbygovernmentdecree.

Id.at556.Lehnert itselfdealtwith limitationson theusebypublicsectorunionsofdissenterscontributions.TheCourtsholding that thestateconstitutionallywasnotpermitted tocompel its employees to subsidize legislative lobbying orotherpoliticalactivities innowayundermines the forceofJusticeScaliasobservationsabout the freeriderproblemasit relates to the representational services that the unionsmustprovidetononmembers.

Acting wholly within the boundaries of the governinglegislation,theSupremeCourthasreconciledthecostlyduties imposed by law onunionswith the rights ofworkerswhodonotwish toparticipate in (orpay for) thatunionsnonrepresentationalactivities. Ithasdone sobydrawingalinebetweenwhatnonunionmembersofabargainingunitcanandcannotbecompelledtopaytheunion.Pursuanttosection8(a)(3)oftheNLRA,29U.S.C.158(a)(3),unionsandemployersmay require all employeeswithin a bargainingunit(unionmembersandnonmembersalike)topaytheunion for the costsassociatedwith theunions collectivebar


40 No.131264

gainingandcontractadministrationfunctions.See,e.g.,Beck,487U.S.at738.Beckheldthatalthoughsection8(a)(3)oftheAct permits an employer and a union to enter into anagreement under which all employees must make certainpaymentstotheunion(essentiallyreimbursingtheunionforservicespromisedandrendered),itdoesnotpermittheuniontocollectfundsfromobjectorsforactivitiesunrelatedtocollective bargaining, contract administration, or grievanceadjustment.Id.

MycolleaguesbelievethatBeckcharacterizesthoseobjectorsasunionmembers,andindeedatonepointtheCourtsaysthatthemembershipthatmaybesorequired[bysection8(a)(3)]hasbeen whittleddown to its financialcore.Id.at745.Butall theCourt is talkingaboutat thatpoint inthe opinion iswhat can be compelled of employees. Elsewhere,itmakesclearthattheBeckobjectorswerenotunionmembers.Howelsecanonereadthestatementatthebeginning of theopinion,where theCourt says [i]n June 1976,respondents,20employeeswhochosenot tobecomeunionmembers,initiatedthissuit.Id.at739(emphasisadded).Themajority has effectively deleted from theCourts Beckopinionitsstatementofthepreciseissueitwasdeciding:

Today we must decide whether this provision alsopermits aunion, over the objections of duespayingnonmember employees, to expend funds so collectedon activities unrelated to collective bargaining, contractadministration,orgrievanceadjustment,and, ifso,whethersuchexpendituresviolatetheunionsduty of fair representation or the objecting employeesFirstAmendmentrights.

Id.at738(emphasisadded).


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To justify its decision to assign the status of statutorymemberstononmembersoftheunion,themajorityseizesonthecommenttowhichIjustreferred,totheeffectthatthe1947 amendments to theNLRA whittleddown the termmembershipinthestatutetoitsfinancialcore.ThislanguagecamedirectlyfromNLRBv.GeneralMotorsCorp.,373U.S. 734, 742 (1963), and so in order to understand it,wemustlookatthatdecision.Whenonedoesso,itisapparentthat themajoritys reading cannot stand.Nothing in eitherGeneralMotorsorBeckwipedouttheconceptofnonmemberinthecourseofdefiningthetermmember.ThepassageinGeneralMotorsfromwhichthatquoteisliftedisprefacedbythe statement that[u]nder the secondproviso to8(a)(3),theburdensofmembershipuponwhich employmentmaybeconditionedareexpresslylimitedtothepaymentofinitiation feesandmonthlydues. Id. (emphasisadded).TheCourtdidnotequateinitiationfeesandmonthlyduestothefairsharepayment that it recognizedaquarter century later inBeck. The only point itwasmaking inGeneralMotorswasthatadutytopaybothinitiationfeesandmonthlydueswasenoughtomakesomeoneamember,eveniftheuniondisclaimed the idea that membership went along with thosepayments.Reality, inotherwords, iswhatgoverns;not labels.Unsurprisingly,peoplewhoarecompelledtopayprecisely the same amount as unionmembers pay should beconsidereddefactomembers.Withthisbackgroundinmind,themajoritysrationalefordisregardingtheCourtsowndescriptionofthe issuethat itdecided inBeckfallsapart.Beckmakesclearthatobjectorsarenotmembers,butthattheycanbecompelledtopayfortheservicesthattheyconsume.

Insodoing,Beckfinetunestherulesgoverningarecognized union, on the one hand, and the nonmembers for


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whom theunion is responsible,on theother. Itdoes sobyholdingthatwhilethecollectionofduesunrelatedtocollectivebargaining(andotherrepresentationalactivitiessuchasthehandlingofgrievances)wouldviolatetheFirstAmendmentrightsofthenonmembers,federallawneverthelessentitles the union to collect fees fixed by their underlyingpurposedefrayingthecostsofcollectivebargaining.Beck,487U.S.at759. Interestingly, theCourtalluded to the freerider issuewhen it recognized that the legislative justification for section 8(a)(3) was to ensur[e] that nonmemberswhoobtainthebenefitsofunionrepresentationcanbemadetopayforthem.Id.

Beforeturningtothewayinwhichtheseprinciplesapplytothecasebeforeus,IaddafewwordsabouttheSupremeCourts recentdecision inHarrisv.Quinn, supra.ThequestioninHarriswaswhethertheFirstAmendmentpermitsaStatetocompelpersonalcareproviderstosubsidizespeechonmatters of public concern by a union that they do notwish to joinor support. 134S.Ct. at 2623.TheCourt answeredthatquestioninthenegative.ItheldthatthepersonalcareworkerscouldnotberequiredtopayeventheagencyfeethatAboodhadauthorized,intheunusualcircumstancesof theirworkplace.TheCourtstressed the fact that thedifferencebetweencoreunionspeechand issuessuchaswages,pensions,andbenefits forpublicemployees is farmoreelusive than it is for private employees. It commented onthe conceptualdifficultyofdistinguishing inpublicsectorcasesbetweenunionexpenditures thataremade forcollectivebargainingpurposesandthosethataremadetoachievepoliticalends.Id.at2632.TheCourtalsofoundsignificantthefactthatthepersonalcareassistantswerehardlypublicemployeesatall: theywerehired, fired,andsupervisedby


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theclient,andtheywerenoteligibleforahostofstatebenefits. This unusual status, itwrote, has important implicationsfortheabilityoftheuniontochargeanagencyfee.Id.at2636.Aboods rationaleisbasedon theassumption thattheunionpossessesthefullscopeofpowersanddutiesgenerallyavailableunderAmericanlaborlaw.Id.

InHarris,practicallytheonlythingtheunionwasdoingwaspresentingitsviewstothestate.Itcouldnotsetwages,whichwereestablishedbylaw,andithadnoauthorityovergrievances.Inthatsetting,allthatwasleftwasspeech.Wellestablishedprinciplesentitledtheobjectorstorefusetopayafee that could only be subsidizing that speech. TheCourtuncoverednothingofvaluethattheunionwascompelledtofurnish to theobjectors,andso ithadnooccasion toworryaboutanycompelledtransferofpropertyorservices.

The case before us does not share those distinguishingfeaturesofHarris.Itconcernsprivateemployersandprivateemployees, not state employees. The rights of employeeswhoarenotunionmemberstorefrainfromsubsidizingunionspeecharefullyprotectedbytheirentitlementtogivetheuniononlyafairsharethatiscappedbythecostsofrepresentational activity.TheHarrisCourt itself recognized thatthe case before it lacked all of the features thathave beenunderstoodtojustifytheagencyfee:

What justifies the agency fee, the argument goes, isthe fact that theStatecompels theunion topromoteandprotecttheinterestsofnonmembers.Ibid.Specifically,theunionmustnotdiscriminatebetweenmembers and nonmembers in negotiating and administering a collectivebargaining agreement and representingtheinterestsofemployeesinsettlingdisputes


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andprocessinggrievances.Ibid.Thismeansthattheunion cannot, for example, negotiate particularlyhighwage increases for itsmembers inexchange foracceptingnoincreasesforothers.Ibid.Andithasthedutytoprovideequalandeffectiverepresentationfornonmembersingrievanceproceedings,seeIll.Comp.Stat.Ann.,ch.5,315/6,315/8,anundertaking thatcan be very involved. See, e.g., SEIU: Member Resources, available at www.seiu.or/a/members/disputesandgrievancesrightsproceduresandbestpractices.php (detailing the steps involved inadjustinggrievances).

134 S. Ct. at 263637. Every one of the features that wasmissinginHarrisispresentinthecasebeforeus.Ithereforeconclude that nothing inHarris undermines either Beck ortheanalysisIhavedescribedthusfar.

IIThe question before us is how these principles operate

when a state chooses to adopt a socalled righttoworklaw (either by statute or in its constitution). Indiana haspassed such a law. See IND. CODE 2266. Federal lawleaves some room for such state laws,pursuant to section14(b) of theNLRA, 29U.S.C. 164(b).But the question iswhetherstatelawcancommandtheunion(aprivateorganization)toperformuncompensatedservicesforotherprivateparties(thenonmembers).Ifthefederallaborlawspreemptthiskindof state law, then the state lawmustyield. If thefederalstatuteeitherauthorizes thiskindof takingor issilent, then we must move to the constitutional issues towhichIhavealluded.


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Bearinginmindthatweshouldalwaysconsiderstatutory arguments first, see, e.g., SolidWasteAgency ofN. CookCnty.v.U.S.ArmyCorpsofEngrs,531U.S.159,162(2001),Ianalyze theNLRAbefore tacklingany constitutional issue.WeallagreethatthepivotalsectionoftheNLRA issection14(b), 29 U.S.C. 164(b). Section 14(b) was added to theNLRAin1947bytheTaftHartleyAct,61Stat.151,aspartofanefforttorein incertainunionpracticesthatCongressregarded as abusive. Entitled Agreements requiring unionmembership in violation of State law, section 14(b) statesthat:

Nothing in thissubchaptershallbeconstruedasauthorizing the executionorapplicationofagreementsrequiringmembershipinalabororganizationasacondition of employment in any State or Territory inwhichsuchexecutionorapplication isprohibitedbyStateorTerritoriallaw.

29U.S.C. 164(b) (emphasis added). This is the languagethatwemustconstrue.Thequestioniswhatitmeanstosaythatstatescanprohibitagreementsrequiringmembershipinalabororganizationasaconditionofemployment.Moreparticularly,wemustdecidewhethersection14(b)authorizes the sweeping prohibitions found in Indianas Right toWorklaw.Plaintiffschallengebothsection3andsection8ofthatlaw,Ind.Code22663and22668,butIagreewiththe majority that section 3 adds nothing to the picture. Ithereforefocusonsubparts2and3ofsection8,whichprovideasfollowsinrelevantpart:

Apersonmaynotrequireanindividualto:


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(2) pay dues, fees, assessments, or other charges ofanykindoramounttoalabororganization;or(3)pay toa charityor thirdpartyanamount that isequivalent toorapro ratapartofdues, fees,assessments,orotherchargesrequiredofmembersofa labororganization;asaconditionofemploymentorcontinuationofemployment.

IND.CODE22668(emphasisadded).Statutory interpretationbeginswith theplain language

ofthestatute.UnitedStatesv.Berkos,543F.3d392,396(7thCir. 2008).Courts should assume that thepurpose of thestatute is communicated by the ordinary meaning of thewordsCongressused;therefore,absentanyclear indicationof a contrary purpose, the plain language is conclusive.UnitedStatesv.Ye,588F.3d411,41415 (7thCir.2009).Mycolleagues read theword membership oddly, as awordthatdescribesbothunionmembersandnonmembersoftheunion. Nonmembers somehow morph into members, theysay, if thenonmembersare required topay theunion anything, even a fee limited to reimbursement for the servicesthat federal law insists theyareentitled toreceive from theunion.By this logic, IbecomeamemberofChicagosUniversityClubtheminuteIsomuchaspayformydinnerataneventhosted there.Thiswould come as a surprise toboththeClubandme.Onemightevenaskifmoneyissignificantatall: Iassume thatnonmemberswhoenjoyunionservicesfor free falloutsideeven themajoritysdefinitionofmembership,thoughIdonotknowwhythatshouldbethecase,iftheyarestillbeingrepresentedbytheunion.Themajority


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believes that its interpretationofsection14(b) iscompelledbythelanguageoftheNLRA,asinterpretedbytheSupremeCourt. In addition, it relies very heavily on the legislativehistoryoftheTaftHartleyAct,anteat1318.Withrespect,Idonotagreewithitsreadingofthestatutorylanguage,andIcannot agree that the legislative history has anyparticularpersuasivevalue.

ThedecisionsknownasRetailsClerksIandIImarkedthefirst time theSupremeCourtaddressedastatespowerunder section 14(b). SeeRetailClerks IntlAssn, Local 1625 v.Schermerhorn,373U.S.746 (1963) (RetailClerks I)andRetailClerks Intl Assn, Local 1625 v. Schermerhorn, 375 U.S. 96(1963) (RetailClerks II).InRetailClerks I theCourtreviewedanagencyshopagreementunderwhichallemployeesatthecompanywere required topay fullunion fees,whetherornottheywereunionmembers.TheCourthadheldinGeneralMotors thatanagency shop clause thatwasnotprohibitedbystatelawwasapermissiblesubjectofcollectivebargaining. 373 U.S. at 735. But GeneralMotors arose in Indiana,whichatthetimepermittedagencyshopagreements;RetailClerks I, in contrast, arose inFlorida,whichhas a righttowork law that forbade thesearrangements.Relyingon section 14(b) and the righttowork legislation, the plaintiffs(nonunionizedemployees)broughtalawsuitseekingadeclaration that the agencyshopprovisionwas void.Defendantsargued,interalia,thatsection14(b)gavestatesonlythepower toprohibit agreements that required membershipinlabororganizations.Agencyshopagreements,defendantspointedout,didnotrequiremembership;theymerelyrequirednonmembers topay fees equal tomembership fees.This,defendantsurged,wascompatiblewiththestatute.


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Thedistrictcourtfoundthatthestatesrighttoworklawoutlawednotonlyunion shops (underwhichunionmembershipcouldbecompelled)butalsoagencyshops.TheSupremeCourtaffirmed, finding that[a]t thevery least, theagreements requiring membership ina laborunionwhichare expressly permitted by the proviso [to 8(a)(3)] are thesame membershipagreementsexpresslyplacedwithin thereachof state lawby 14(b). 373U.S. at 751.Pointing toGeneralMotors, theCourt found that agencyshop arrangementswhich impose[]onemployeestheonlymembershipobligationenforceableunder8(a)(3)bydischarge,namely,theobligationtopayinitiationfeesandregularduesisthepractical equivalent of an agreement requiring membership ina labororganizationasaconditionofemployment.Whatevermay be the status of less stringent unionsecurity arrangements,theagencyshopiswithin14(b).Id.at75152(emphasisadded).

As the statement just highlighted demonstrates, theCourtwascareful inRetailClerks I to leave foranotherdaythe statusof less comprehensivearrangements. Itobservedthat thepetitionersoriginallyhad likened their case to theGeneralMotorsagencyshop.373U.S.at752n.4.Only later,uponbriefingandargument,didtheytrytodistinguishtheirsituation from the fullblown agency shop. Id.At that latehour,theyarguedthattheclauseintheiragreementprovided thatnonunionemployeeswouldcontribute to theunionfor thepurposeof aiding theUnion indefraying costs inconnectionwith its legalobligationsand responsibilitiesasthe exclusivebargainingagentof the employees in theappropriatebargainingunit.Id.at752.Thepetitionersassertedthatthislanguageconfinedpaymentsfromnonmemberstocollectivebargainingpurposesaloneandprohibitedthe


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union fromusing thepayments for institutionalpurposesunrelatedtoitsexclusiveagencyfunctions.Id.

The SupremeCourt rejected this lastminute attempt todistinguishGeneralMotors.Itpointedoutthatcontrarytothepetitionerssuggestion,theclauseatissueimposednoironclad restrictiononwhat theunioncoulddowith thepaymentsitreceivedfromnonmembers,andthustherewasnosafeguardagainsttheunionsuseofthemoneyforinstitutional items. Id. at 753. In addition,because theproposedservicefeewassetatanamountequaltotheunionsinitiationfeesanddues,whichcouldbeusedforanynumberofpurposes,therewasnoguaranteethatanonmemberwouldnotpaymoreoftheunionscollectivebargainingcoststhanhisproratashare.Id.at754.TheCourtexplained:

If theunions totalbudget isdividedbetweencollective bargaining and institutional expenses and ifnonmember payments, equal to those of amember,go entirely for collective bargaining costs, the nonmemberwillpaymoreoftheseexpensesthanhisprorata share.Thememberwillpay lessand to thatextentaportionofhisfeesandduesisavailabletopayinstitutional expenses. The unions budget is balanced.Bypayingalargershareofcollectivebargainingcoststhenonmembersubsidizestheunionsinstitutionalactivities.

Id.Accordingly,therewasnoreasonwhytheclauseshould,inthepresentpostureofthecase,beconstruedagainstrespondent to raisea substantialdifferencebetween thisandtheGeneralMotorscase. Id.at752. Itwouldbeanomalous,theCourt said, to let a state ban agencyshop agreementsunderwhichunionmembers and nonmemberspaid equal


50 No.131264

shareswhile forbidding it tobananarrangement inwhichnonmembers might pay even more bargaining costs thanmembers.Id.at754.RetailClerksIthusstandsonlyforthepropositionthata

unionmaynotdoan endrunaround section14(b)by imposing financialexactionsonnonmembersexactlyequal tothechargesbornebymembers.AsIalreadyhavenoted,RetailsClerks Ireserved thestatusofmoregenuineaccommodationstononmembersforanotherday.Thisisthatday,forour court. Indianas flatprohibitionagainstagreementsbetween employers and unions under which a union nonmembercannotbechargedevenforlegallyrequiredandbonafiderepresentationalactivitiesgoeswellbeyondthedefacto membership the Supreme Court considered in RetailClerksI.

Wellestablished principles of labor preemption alsostand in thewayof themajoritys result.While there isnoexpresspreemptionclauseintheNLRA,theSupremeCourthasrecognized that itspreemptivereach isbroad.SeeBenjaminI.Sachs,DespitePreemption:MakingLaborLawinCitiesandStates,124HARV.L.REV.1153,1154 (Itwouldbedifficulttofindaregimeoffederalpreemptionbroaderthantheonegrounded in the (NLRA)). InGarmon, theSupremeCourtheld that statesmaynot regulateactivitiesevenarguably protected or prohibited by federal labor law. SanDiegoBldg.TradesCouncil,Etc.v.Garmon,359U.S.236,245(1959).InMachinists,itwentevenfurther,findingthatstateregulation ofunion activity thatwasneitherprotectednorprohibited by federal labor law was preempted, as Congressintendedthattheconductbelefttobecontrolledbythe freeplayofeconomic forcesandnotberegulableby


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Statesanymore thanby theNLRB.Lodge76, IntlAssnofMachinists v.Wis.EmptRelationsComm., 427U.S. 132, 149(1976).Against thisbackdrop,Ibelieve thatwearenot freetoreadsection14(b)asthemajoritydoes.Itisinsteadanarrow exception to an otherwise encompassing preemptionregime.

Inothersection14(b)casescourtshavestruckdownsimilarly restrictive state laws as outside the scope of section14(b) and thereforepreempted.For example, inN.L.R.B. v.HoustonChapter,AssociatedGen.ContractorsofAm., Inc.,349F.2d449(5thCir.1965),theFifthCircuitheldthatademandforanondiscriminatoryhiringhallclauseby theuniondidnotfallwithintheareacarvedoutforstateregulationbysection14(b)andthusthestatewaspreemptedfrombanningit.Thecourtexplaineditsdecisionasfollows:

Itistruethatthetermsof14(b)aswellasthelegislativehistorysuggesttheintentonthepartofCongresstosave to thestates theright toprohibitcompulsoryunionism. However, the long and the short of thismatteristhat14(b)contemplatesonlythoseformsofunion securitywhich are the practical equivalent ofcompulsory unionism. Membership in the union isnotcompulsoryundertheclausehereinquestion.Nodoubtunionmembershipwillbeencouragedunder thearrangement, indeed itmaybeaboon to theunion; nevertheless such an arrangement does notconstitute compulsory unionism so long as the arrangement isnotemployed inadiscriminatorymanner.

Id. at 453 (internal citations omitted). The Eighth Circuitmade the same point in Laborers InternationalUnion, Local


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107v.Kunco,Inc.,472F.2d456(8thCir.1973),whereitcommentedthat[s]ection14(b)doesnotempowerstatestobanallinvoluntaryrelationshipsbetweenworkersandunions.Itmerelyallowstheprohibitionofagreementsrequiringmembership in a labor organization as a condition of employment.Id.at458.SeealsoLocalUnionNo.415ofIntlBhd.ofElec.Workersv.Hansen,400P.2d531,53637 (Wyo.1965)(findingpreemptedstatuteproviding thatnoperson isrequiredtohaveanyconnectionwithalabororganizationasaconditionofemploymentorcontinuedemployment).

It is true, asmy colleaguespointout, that theCourtofAppeals for theDistrictofColumbiadecided 32years agothat the assessment of even representational fees againstnonunionmemberswasanunfair laborpractice ina righttowork state.See IntlUnion of theUnitedAssn of Journeymen&ApprenticesofthePlumbing&PipefittingIndus.oftheU.S. & Canada, Local Unions Nos. 141, 229, 681, & 706 v.N.L.R.B., 675 F.2d 1257, 126768 (D.C. Cir. 1982). But thePlumbing&PipefittingdecisioncannotbereconciledwiththeSupreme Courts later Retail Clerks decisions nor with thedistinction that Beck drew between the limited obligationsthatnonmembersretainandthosevoluntarilybornebyunionmembers.JudgeMikvasdissentingopinionwas, inmyview,prescient;italsoprovidesausefulandcomprehensivereview of the legislative history of section 14(b) that supportstheconclusionhewouldhavereached(andthatIreachhere).See Id.at126875.Rather than repeat JudgeMikvasaccount,Imentiononlyafewofthehighlightsforthebenefitofthosewhoregardlegislativehistoryasausefultool,inordertoillustratethefactthatthepiecesoflegislativehistorythemajorityhasfounddonotrepresenteitherthelastortheonlywaytolookatit.


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AsInotedattheoutset,modernAmericanlaborlawbeganwith the passage of theWagnerAct in 1935. Enactedagainst thebackdropof significantviolencebetweenworkersandemployersat thebeginningof the20thcentury,theWagnerAct gaveworkers the right to organize in unionsand to bargain collectively with their employers. AfterWorldWarII,however,therewasafeelingbysomeinCongressthatthependulumhadswungtoofar inthedirectionofunionization. Inparticular, closedshop agreements,underwhichanemployeragreedtohireunionmembersonly,werethoughtbysomemembersofCongresstobeapowerfultoolthatunionleaderswereabusing.Ontheotherhand,the very samemembers ofCongresswere sympathetic toward other union security agreements. In response, CongresspassedtheTaftHartleyActof1947,61Stat.151.TaftHartley introducedmany changes to theNLRA, some administrative, some substantive.Likemost legislation, it reflectedacompromise, inthiscasebetweenunionandmanagement interests. Congress added provisions making itmore difficult for workers to obtain a union shop (i.e., aworkplaceinwhichtheemployerisfreetohireanyone,butnewemployeescanberequiredtojointheunionafterhire),but[]retainedtheunionshopasamandatorysubjectofbargaining in section 8(a). Plumbing& Pipefitting Indus., 675F.2dat1272.

The legislativehistoryofsection14(b) indicates that thedrafters understood it as a reaffirmation of the originalNLRA:

ItwasnevertheintentionoftheNationalLaborRelationsAct,as isdisclosedby the legislativehistoryofthat act, topreempt the field in this regard so as to


54 No.131264

deprivetheStatesoftheirpowerstopreventcompulsory unionism. Neither the socalled closed shopproviso insection8(3)of theexistingactnor theunionshopandmaintenanceofmembershipproviso insection 8(a)(3)of the conference agreement couldbesaid to authorize arrangements of this sort in Stateswhere sucharrangementswere contrary to theStatepolicy.Tomakecertainthatthereshouldbenoquestionaboutthis,section13wasincludedintheHousebill.Theconferenceagreement, insection14(b),containsaprovisionhavingthesameeffect.

Id. at1272 (citingH.R.Conf.Rep.No.510,80thCong.,1stSess.60 (1947),Leg.Hist.at564).As JudgeMikvapointedout, the predominant if not the only purpose of section14(b)wastoprovideyetonemorecheckontheabusesthatcould exist under compulsory unionism. Id. at 1273. Butwhatdidthatmean?Congressdidnotdefinewhatitmeantby thekey term forourpurposes,compulsoryunionism.Individual members, however, gave examples indicatingthat theywere thinking of the closed shop or occasionallytheunionshop;noonebreathedawordaboutthelegitimacyof requiring nonmembers of the union to pay for servicesthattheunionwaslegallycompelledtogivethem.

Themajoritynotes thatasof the timeTaftHartleywasunderconsideration,12stateshadrighttowork laws ineffect,and that the lawsofseven in thatgroup included language similar to that found in the Indiana law before us.Ante at 1213. From this fact, it infers thatCongressmusthaveintendedtoendorseall12ofthestatelawsineffect.ButwehavenoideawhatCongressasawholethought,andinthe end it is beside the point. We can assume that some


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members who voted for TaftHartley believed, or hoped,thateachoneofthe12statelawswouldbefreetooperateinthe broadest possible way. Others who voted for the billmight have expected each state statute to be tested in thecourts,whichafterallare the institutionwith the finalauthority to say what the law is. Marbury v. Madison, 1Cranch (5U.S.) 137 (1803).Since the languagevaried fromstatutetostatute,thelatterexpectationwouldhavebeenfarfrom unreasonable. Statutes are drafted by multiple persons, often with conflicting objectives. Frank H. Easterbrook, Judges asHonestAgents, 33HARV. J.L.& PUB. POLY915,922 (2010).Thesafestcourse is therefore to lookat thelanguageof the statute, in contextof course,and to reasonfromthere.

AsthelinetheSupremeCourtdrewbetweentheGeneralMotorsdecisionandtheRetailClerkscasedemonstrates,section14(b)allowsstates tooptoutofanythingresemblingaunionshoporanagencyshop.But itdoesnotpermitthemtoallowanyworkerwhowishestofreerideontheunionsmandatory efforts on the nonmembers behalf to do so.Withouttheprotectionofsection14(b),sections8(2)and(3)of the Indiana statutemust fall under normal preemptionanalysis.

IIIIf,contrarytomyanalysis,oneweretoconcludethatIn

diana has worked out a way to conscript the union intoproviding uncompensated services to anyonewhodecidestooptoutofunionmembership,itwouldbecomenecessarytodecidewhethersucharuleispermissibleundertheTakingsClauseoftheFifthAmendment,asappliedtothestatesunder the Fourteenth Amendment. The majority is suffi


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cientlyworriedaboutthispossibilitythatitsfirstresponseistosuggestthattheplaintiffshaveforfeitedthepoint.Anteat1920. Idisagreewith them.First,wearenotcompelled toinvoke forfeiture rules in civil cases, and given the importanceofthisquestion,Iwouldnotducktheissueonthatbasis.Second,plaintiffshavearguedthroughoutthattheIndiana statute is unconstitutional, and at least one Indianacourthascometotheconclusionthatitindeedeffectsatakingunder the state constitution.SeeSweeneyv.Zoeller,No.45D011305PL52 (Super.Ct. of LakeCnty. Sept. 5, 2013).Plaintiffscalledthatdecisiontoourattention.Ifthelawfallsonstategrounds,sobe it;ourcasewillbemoot.But if thehigherstatecourtsultimatelyupholdthelawunderthestateconstitution, however, the federal constitutional issue willremain.Inmyview,theissuehasbeenpreservedadequatelyand even if it has been raised only indirectly, we shouldreachit.

GiventheIOLTAcasesandtheconfiscatorynatureoftheIndiana statute,which requires unions to provide servicesfor free to the objectors, if there is no preemption, then Iwouldfeelcompelledtofindataking.(Principlesoffederalpreemptiondonotpermitustousethejustificationthatthemajority raises: they believe that this is all the fault of thedutyoffairrepresentationinfederallaw.Anteat20.Butitisnotuptothestatetooverridethatduty;wemusttakeitasa