D.C. Cir. Finds Refund Mooted Union Dues Challenge

Daily Labor Report® is the objective resource the nation’s foremost labor and employment professionals read and rely on, providing reliable, analytical coverage of top labor and employment...

By Lawrence E. Dubé

June 17 — A former grocery worker's claim that she was misled about her options under a union-security agreement became moot when she quit her job and received a full refund from the United Food and Commercial Workers, the U.S. Court of Appeals for the District of Columbia Circuit held ( Sands v. NLRB, 2016 BL 193910, D.C. Cir., No. 14-1185, 6/17/16 ).

The D.C. Circuit was skeptical about a former employee's right to pursue an unfair labor practice claim that no longer has a financial effect on her, but it was careful to leave the door open to further complaints on the same legal issue.

Laura Sands petitioned for court review of a National Labor Relations Board decision that UFCW Local 700 wasn't required to notify new Kroger LP employees how much less they could pay under a collective bargaining agreement if they didn't become union members.

Writing for the court June 17, Judge Thomas B. Griffith said the unfair labor practice claim became moot when the union gave Sands a refund that was significantly larger than the amounts she disputed.

Sands wasn't personally entitled to any other relief under the National Labor Relations Act, the court said, dismissing her appeal. However, the court vacated the NLRB's decision and said the unfair labor practice issues raised in the case can be considered in other proceedings.

NLRB Rejected Complaint Against Union

Acting on Sands's unfair labor practice charge against Local 700, the NLRB's general counsel argued unions should be required to inform new employees of the amounts they would owe for a union's representation if they opted out of union membership and became “dues objectors” under Communications Workers of America v. Beck, 487 U.S. 735, 128 LRRM 2729 (1988).

The general counsel alleged Local 700 violated Section 8(b)(1)(A) of the NLRA by failing to adequately inform Sands at the time of her employment.

However, the board affirmed an administrative law judge's dismissal of the unfair labor practice complaint, stating the union's obligation was only to inform Sands of her right to refrain from union membership, to advise her of any internal union procedures for objecting to payment of full dues and fees, and to give her enough information to decide intelligently whether to object to becoming a union member (361 N.L.R.B. No. 39, 200 LRRM 1774 (2014)).

D.C. Circuit Precedent Supported Claim

Griffith wrote that the court's decisions in Penrod v. NLRB, 203 F.3d 41, 163 LRRM 2513 (D.C. Cir. 2000), and Abrams v. Communications Workers of America, 59 F.3d 1373, 149 LRRM 2928 (D.C. Cir. 1995), “would compel us to vacate the Board's order on the merits.”

The D.C. Circuit's view in its earlier decisions was that to give an employee sufficient information to decide about union membership, a labor organization had to at least inform the worker of “the percentage of union dues that would be chargeable” to collective bargaining and representation, as opposed to nonchargeable political expenses.

However, Griffith said the appeals court didn't have jurisdiction to reach the merits of the unfair labor practice allegation, which had become moot.

In 2014, after Sands filed her petition for review in the D.C. Circuit, Local 700 sent her a $350 payment representing a full refund of dues she paid from 2004 until she quit her Kroger job in 2005.

Sands would have avoided payments of $3.50 per month if she had become a nonmember “dues objector,” and Griffith said Sands acknowledged that after she received the union's payment, she no longer had a financial stake in the legal dispute.

Sands argued that she had a continuing interest in having the NLRB ruling reversed and the posting of a notice to remedy the union's alleged unfair labor practice, but the court said she “ended her relationship with the union when she quit her job,” and her counsel “conceded at oral argument that there is no reason to think she will work there again.”

Even if a notice posting would affect current employees, Griffith said, “it cannot redress Sands's injury.”

Court Opts to Vacate NLRB Order

Concluding “this case is moot,” the court said “our inquiry does not end there.”

Griffith said the court looks to the public interest and “notions of fairness” in deciding whether to vacate rulings issued in moot cases, and the “circumstances here counsel in favor of vacating the Board's order.”

Stating that “clearing the path for future relitigation of the issues” would serve the public interest, the court dismissed Sands' petition for review as moot and vacated the NLRB's unfair labor practice order.

Judges David S. Tatel and Brett M. Kavanaugh joined in the opinion.

Aaron B. Solem of the National Right to Work Legal Defense Foundation in Springfield, Va., argued the case for Sands. NLRB attorney Robert J. Englehart in Washington argued for the board, and James B. Coppess in Washington argued for UFCW Local 700.

To contact the reporter on this story: Lawrence E. Dubé in Washington at ldube@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com