A Victory for Employers and Workers

Jun 19, 2008

The U.S. Supreme Court ruled today on Chamber of Commerce of the United States v. Brown and rejected California’s attempt to place the state’s thumb on the scale in the unionization debate.  California Assembly Bill (AB) 1889, enacted in 2000 in response to union lobbying efforts, expressly prohibited employers from using state grant and program funds to "assist, promote, or deter union organizing."   The Court recognized that a state has a legitimate interest in spending its money for legitimate purposes.

But it was not lost on the court that the true purpose of AB 1889 was to silence employer speech about unions by subjecting employers to huge compliance burdens, including segregated accounting systems, onerous recordkeeping requirements, treble damages, private rights of actions and attorneys fees.  And there was nothing 'neutral' about the pro-union exceptions to California's spending ban, which allowed the use of state funds to circumvent secret-ballot elections by entering into voluntary recognition agreements (otherwise known as card-check or “neutrality” agreements) with a union.

As a result of today’s U.S. Supreme Court ruling in Chamber of Commerce of the United States et al.  v. Brown et al., states may no longer restrict employers’ rights to communicate with their employees about unionization.  The decision by an overwhelming majority of the Court shuts the door on attempts by other states to use their spending powers to get around federal labor laws.  The impact of the Court’s decision will be sweeping.  At least 20 states either have similar laws or have proposed to enact laws that also restrict federally protected employer speech about unionization.  This decision will ripple through the legal system and likely result in the invalidation of similar legislation in these states.

My colleague at the Chamber, chief legal officer and general counsel Steven Law, said it best:

"It’s simply unethical for a state to use taxpayers’ funds to tie the hands of employers in union organizing drives.  And not only is it unethical, but today the Supreme Court declared that it’s unlawful under the National Labor Relations Act for a state to muzzle employers’ speech rights."

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