Wednesday, July 3, 2013

Connecticut labor unions win summary judgment in First Amendment mass-layoff claim

Union-bashing was all the rage a few years ago as Republican governors around the country tried to balance their budgets on the backs of organized labor. But Connecticut was 10 years ahead of the game. In 2003, the governor targeted union members for mass layoffs when the union would not agree to certain concessions. The union sued the governor under the First Amendment. The district court dismissed the case on summary judgment. The Court of Appeals reverses and awards the labor unions summary judgment on liability.

The case is State Emp. Bargaining Agent Coalition v. Rowland, decided on May 31. Connecticut was having budget problems in 2002-03. The state tried to talk the union into accepting certain concessions, and it told the union that the alternative was the termination of 3,000 unionized employees. Of the 50,000 state employees, 37,500 of them were in the union. Here is the factual framework:

Defendants advised plaintiffs that unless they agreed to these concessions, defendants would fire approximately 3000 unionized state employees. Although all state employees receive the same health care and pension benefits, defendants “intentionally directed their demands for health care and pension concessions (and their corresponding threats of termination if the concessions were not granted) solely to state union employees.” Plaintiffs did not agree to all of the proposed concessions, but instead offered alternative concessions. In December 2002, defendants ordered the firing of approximately 2800 unionized state employees. These firings were effectuated in 2003 and were limited to unionized state employees. No non-union workers were fired. While the fired employees were told that they were being laid off due to economic necessity caused by the state’s fiscal year 2003 budget deficit, the firings in fact “had minimal effect” on the state’s fiscal year 2003 expenses, and “were ordered as a means of trying to compel the plaintiff unions to agree to the concessions demanded.” Defendants advised plaintiffs that the 2003 firings would be rescinded if plaintiffs agreed to the proposed concessions.
State budget sausage-making is ugly. Log-rolling, back-slaps and threats make the world go round at the state capitol in New York, and I'm sure it's no different in Connecticut. But even state officials are governed by the Constitution. Maybe they did not think this raised a First Amendment problem. The Second Circuit (Lynch, Raggi and Chin) thinks it does.

The First Amendment protects the right to associate with a labor union. This case charts new ground. The Court says, "we have never articulated a standard for determining whether, and under what circumstances, a public entity’s employment decisions violate this right to associate in unions." After surveying the Supreme Court cases in related areas, the Court of Appeals decides on a legal test: "Conditioning public employment on union membership, no less than on political association, inhibits protected association and interferes with government employees’ freedom to associate. It is therefore subject to the same strict scrutiny, and may be done only 'in the most compelling circumstances.'”

Under this pro-plaintiff standard, the Court of Appeals grants the plaintiffs summary judgment. The state cannot articulate a compelling reason for targeting union members in effectuating layoffs. "The stipulated facts make clear that the 2003 firings were not tailored to reduce the cost of the State’s work force. To the contrary, defendants have stipulated that the 2003 firings 'had minimal effect on the State’s [fiscal year 2003] expenses,' and that the savings realized from the 2003 firings did not correlate to the concessions requested from the unions." More important, the Court says,

defendants have not shown why the State’s fiscal health required firing only union members, rather than implementing membership-neutral layoffs. Defendants have stipulated that all state employees, whether or not they belong to unions, receive the same health care and pension benefits. Nothing in the stipulation provides any support for an argument that union members cost more, provided fewer services, or were distinguishable from their non-union coworkers in any way other than their membership itself. Defendants chose to accomplish whatever cost savings were achieved by firing only employees who were union members, as opposed to targeting the least valuable or most expensive workers. Thus, layoffs predicated on union membership could not differentially affect the savings to be achieved, or the efficiency of the state’s work force.

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