A pair of federal courts struck down union challenges to labor reforms in Indiana and Wisconsin last week, preserving major Republican gains aimed at cutting costs and attracting business.
Federal Judge Philip Simon on Thursday tossed out a lawsuit aimed at preventing Indiana from becoming the first right-to-work state in the Midwest. He rejected the union’s contention that Republican Gov. Mitch Daniels and the legislature overreached in pursuing labor reforms.
"None of the legal challenges launched by the union here to attack Indiana’s new Right to Work law can succeed," he wrote. "The electorate can ultimately decide whether [lawmakers’] judgments are sound, wise, and constitute good governance and can express their opinions at the polls and by other means. But those are questions beyond the reach of the federal court."
Glenn Taubman, an attorney with the National Right to Work Legal Defense Foundation, was not surprised the unions failed to derail the reforms, which allow employees to opt out of forced unionization.
"Since the 1940s, the Supreme Court has upheld right-to-work laws in the face of union attacks, as RTW laws do not infringe on any union ‘rights,’" he said. "It is forced unionism and monopoly representation that infringe on individual employees' rights."
Judge Simon’s ruling only applies to federal challenges to the law. Unions have also sued in state court to prevent the law from going into effect. They say it violates an Indiana constitutional provision that prevents the government from denying private organizations their rightful wages.
"Indiana’s own constitution says that you can’t mandate people to act without just compensation," said Marc Poulos, an attorney challenging the Indiana law on behalf of the Indiana, Illinois, and Iowa Foundation for Fair Contracting (IIIFFC). "Right-to-work no longer allow us to collect the reasonable fees for the representation we provide all employees."
However, supporters of the law point out that the provision refers to the government honoring its own contracts for services rather than private transactions, such as union dues. Republican state Rep. Jerry Torr, who authored the right-to-work law, said he believes it will survive all legal challenges.
"Right-to-work has passed in more than 20 states and those have all withstood the various challenges and the test of time. Eventually our law will be found to be appropriate," he said.
Soon after the Indiana ruling, a federal appeals court in Chicago upheld Republican Gov. Scott Walker’s public sector labor reforms, which helped close Wisconsin’s $3.6 billion deficit after its passage in 2010. The Seventh Circuit Court of Appeals upheld the act "in its entirety," overturning a previous federal ruling that stopped Act 10’s prohibition of automatic union deductions from employee paychecks and recertification.
The labor groups that brought the suit contended that curtailing the ability of unions to automatically collect dues from employee paychecks violated its freedom of speech. The court, however, determined that the system represented a "subsidy" to unions rather than an extension of natural rights.
"While the First Amendment prohibits ‘plac[ing] obstacles in the path’ of speech … nothing requires government to ‘assist others in funding the expression of particular ideas, including political ones,’" the decision says.
Walker welcomed the ruling, hoping it would allow the state to move past the division and at times violent upheaval caused by union members and allies.
"Today’s court ruling is a victory for Wisconsin taxpayers," he said in a statement. "With this ruling behind us, we can now focus on the next state budget, which will invest in priorities to move our state forward."
The ruling represented Walker’s second major victory in the fight to preserve the reforms, which took away collective bargaining for public sector employee benefits and pensions, while preserving them for salaries. Walker previously survived a recall election sponsored by the unions.
Act 10 has saved Wisconsin more than $2 billion since its June 2011 implementation.
The rulings come as unions ramp up legal challenges to Michigan’s new right-to-work law. Taubman says the courts have helped to solidify the foothold labor reformers have made in the heavily unionized Midwest.
"Because federal law is so clear, any union efforts to challenge laws that outlaw forced unionism or union bosses' special privileges are destined to fail," he said. "This is why the Michigan union bosses realize that any potential legal challenges they may bring to derail that state's new RTW law are futile and a complete waste of their members' money."