Guest Post: The Takings Clause and Sweeney v. Pence

Heather Whitney is a Lecturer in Law and Bigelow Teaching Fellow at the University of Chicago. She clerked for Chief Judge Wood before starting at Chicago. The views expressed here are her own and do not necessarily represent those of Judge Wood.

In an op-ed back in July, Ben and Catherine Fisk argued that the Supreme Court’s decision in Harris v. Quinn “put[s] unions in a bind” because the union still has a duty of fair representation toward non-paying non-members. In her recent dissent in an important Right to Work case, Sweeney v. Pence, Chief Judge Wood identified a different problem created by Harris: requiring a union to provide non-paying non-members with the same representational services provided dues-paying members is an unconstitutional Taking.

The Indiana Right to Work statute in Sweeney, which the Seventh Circuit upheld against preemption and constitutional challenges, prohibits any person from requiring an individual to pay dues, fees, assessments, or other charges of any kind or amount to a labor organization. While the statute relieves non-members from making any payment to the union, the union retains a duty of fair representation, which requires it (among other things) to equally represent members and non-paying non-members throughout the grievance procedure. This means that the union is required to go into its own coffers, pull out its private property (money it received voluntarily from members) and transfer it, by means of services, to non-paying non-members.

While plaintiffs did not raise a Takings issue originally, Judge Wood raised it nonetheless in her dissent. As she saw it, the Supreme Court’s decision in Phillips v. Washington Legal Foundation made plain that when a state compels one private party (here a union; in Phillips, individuals) to give their property to another private party (here the non-paying non-members; in Phillips, a foundation providing legal services to the indigent) that compulsion must be assessed under the Takings Clause. Under that framework, she reasoned that Indiana exacted a Taking because it provided no public purpose and no just compensation. The majority disagreed. It does not discuss public purpose directly but appears to imply that it is whatever motivated the duty of fair representation. The majority discusses the just compensation issue expressly, and concludes that it is satisfied in the form of exclusive representation.

It strikes me that the majority’s Taking analysis misses the mark.

The majority ducks the public purpose issue by simply analogizing the union’s duty of fair representation to that of a legislative body. But this analogy falls short. Whether the government’s choice to create an exclusive bargaining regime was done from a public purpose remains unexamined. Moreover, even if exclusive representation is motivated by a public purpose, it is unclear that that public purpose justifies the Taking. How can the desire for exclusive representation justify compelling a union to provide it free of charge? The majority would respond that the union’s designation as the exclusive bargaining representative is itself just compensation, but this is troubling. I am unfamiliar with any other Taking’s case where compensation is provided in such a form. What of unions who adamantly do not want to be the exclusive bargaining representative? I would have thought that just compensation — non-member payment for services rendered — is what the statute explicitly prohibited.

Many conservatives champion the holding in Harris because they are adamant that workers should not be forced to join unions or pay for union representation. It is puzzling that they do not also object to what appears to be the Taking of property that results from Harris. What justification can there be for requiring a union to transfer its private property to non-union non-members?

At the same time, some may worry that if the Right-to-Work law constitutes a Taking, then so too might other forms of government regulation, including possibly much of the NLRA itself. The full ramifications of Judge Woods’ argument are beyond the scope of this post, but since Sweeney concerns a law compelling one private party to expend their money to provide services to another, at least the variety of use restrictions present throughout government regulations appear unscathed.

Enjoy OnLabor’s fresh takes on the day’s labor news, right in your inbox.