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July 12 — A Transport Workers Union labor contract's requirement that covered nonmember employees pay collective bargaining fees and the union's procedure for workers to opt out of paying the fees are constitutional, a federal appeals court ruled ( Serna v. Transport Workers , 2016 BL 221988, 5th Cir., 15-10328, 7/11/16 ).
The U.S. Court of Appeals for the Fifth Circuit's decision July 11 affirmed a district court ruling in May 2015 granting summary judgment to the TWU and dismissing a class action brought by a group of workers at Envoy Air Inc. and Southwest Airlines Co., whose case was supported by the National Right to Work Legal Foundation.
“We conclude that the two questions presented in this appeal are governed by controlling Supreme Court and Fifth Circuit precedent,” the appeals court said, citing decisions permitting the Railway Labor Act's union shop provision and the RLA's opt-out requirement.
The plaintiffs are current or former employees of Envoy, formerly American Eagle Airlines Inc., and Southwest Airlines who aren't or weren't TWU members. The TWU’s labor contracts with Southwest and American Eagle contain union security clauses requiring all represented employees, regardless of whether they are members of the union, to pay their share of costs related to the TWU’s collective bargaining activities.
The U.S. District Court for the Northern District of Texas in December 2014 certified a class of former, present and future nonmembers of the TWU, excluding those who have since joined the union.
The Department of Justice intervened in the case, urging the court to reject the constitutional challenge to the union shop provision of the RLA, which governs labor relations in the railroad and airline industries.
The workers claimed that the RLA’s authorization of compulsory union fees and the TWU’s opt-out choice structure for union fees and its requirement that nonmembers renew their objections annually violate the First Amendment, according to the district court's 2015 decision. They also argued the TWU’s escrow-and-rebate procedure for collecting dues violates the First Amendment. The TWU later removed the annual renewal requirement.
The U.S. Supreme Court in Railway Employees Department v. Hanson, 351 U.S. 225, 38 LRRM 2099 (1956) found the RLA's union shop provision constitutional under the commerce clause.
The plaintiffs argued, however, that recent high court decisions have been critical of past decisions affirming the constitutionality of union-shop provisions generally and constitute an invitation to eventually re-litigate the RLA provision.
The TWU and the DOJ said the plaintiffs failed to show that recent Supreme Court decisions undermined Hanson or other precedent upholding the union shop provision.
The district court, in granting summary judgment to the TWU, agreed. It found that although the Supreme Court cases “have arguably indicated some concern regarding the soundness” of Hanson, “it is not the role of this Court to deviate from established, binding jurisprudence.” The lower court also granted summary judgment to the union one two other issues while finding another claim moot.
The Fifth Circuit in a two-page decision said the nonmembers' appeal raised two questions, one regarding the RLA's union-shop provision and the other regarding the opt-out requirement.
Affirming the district court's findings, the appeals court said both issues are governed by Supreme Court and Fifth Circuit precedent. It cited Hanson and Shea v. Int’l Ass’n of Machinists & Aerospace Workers, 154 F.3d 508 (5th Cir. 1998), which found the RLA's opt-out requirement is permissible.
The lower court in its decision also ruled that the TWU's removal of the annual renewal requirement made the plaintiffs' claim on that issue moot and that circuit courts have upheld the constitutionality of escrow-and-rebate procedures.
The TWU collects the entire dues amount from objecting employees, placing the nonchargeable portion in an interest-bearing escrow account with a cushion of an additional 50 percent of that amount, and subsequently refunds the nonchargeable portion with interest to the nonmember.
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The decision is available at http://www.bloomberglaw.com/public/document/Jose_Serna_et_al_v_TWU_of_America_AFLCIO_Docket_No_1510328_5th_Ci.
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