Share this article

print logo

Impact of Supreme Court ruling on union fees starts to be felt

ALBANY – On Wednesday morning, thousands of public employees across New York saw a boost in their take-home pay – without a dime coming from taxpayers.

The state, and many localities, are starting to comply with the recent and controversial decision by the U.S. Supreme Court that made it illegal for government agencies to force nonunion members to pay a fee, known as an agency shop fee.

In just state agencies alone, revenues that have flowed to 29 separate unions are affected.

The landmark decision, vehemently opposed by unions, started to kick in with Wednesday’s state payroll for mostly agency-based workers. The following week, those stationed in institutional settings, from state health facilities to prisons, will see their biweekly agency fee disappear from their paycheck unless they do not affirmatively state they want to be in a union.

In all, 31,000 state workers over the coming two weeks will see an end to their agency shop payments, according to the state Comptroller’s Office. The Empire Center for Public Policy, a fiscal watchdog group, has estimated such fees account for $112 million annually for state workers.

That’s a lot of money for unions to suddenly forgo, and many of the public employee unions already have begun campaigns to both keep their current members enrolled as union loyalists and to get those who paid agency shop fees to join a union – a move that would keep those prior agency fee amounts coming in to unions as union dues.

Meanwhile, other conservative-leaning groups have either formed or are expanding efforts in places like New York to try to convince union members to leave their bargaining units and save money in the meantime.

It’s a fledgling fight in New York, which has the biggest concentration of unionized workforces in the nation. But the jockeying is well underway as some groups, long concerned about what they view as the outsized political power of the public employee unions, hope to use the Supreme Court’s decision – Janus v. AFSCME – to put a dent in that influence both at the state and local government levels.

Unions say they are prepared for the fight, and have been preparing for the court case’s aftermath for years. At the Public Employees Federation, which represents white collar state workers, the urgency is heard just by calling the union’s headquarters located just outside Albany. “Press one if you’re calling regarding your membership and the recent Supreme Court decision," a recorded voice greets callers.

At the Civil Service Employees Association, the largest state workforce union that is also a major force in local governments such as Erie County, confidence is the reaction. “We have for years been having conversations with our members about this," Mathew Cantore, a spokesman for the 300,000-member union, said of the court battle that ended with the June 27 Supreme Court decision.

“We know they have all said very clearly they’re sticking with us. Our impact has been very minimal. We’ve had a few people drop. That’s been it," Cantore said. He could not provide a number of CSEA members who have left the union since the court’s decision.

There are more than 1 million public employees in New York aligned with a union. Dues and additional fees are used to not only help pay for legal, collective bargaining and other staff services for union members, but also for political action efforts, including in some cases large political staffs, phone banking operations, political ads and donations to candidates. Some of the bigger unions routinely place in the top 10 in lobbying and campaign-related expenses in the New York.

Payroll agencies forced to act

Governments across the state have been rushing to come up with ways to stop agency shop fees charged to employees who are not members of unions – a practice permitted in the nation dating to a 1977 court ruling.

Some agencies have been quicker at making the payroll change than others, raising the question of when the deadline was for them to act. Would any agency shop payments after the June 27 decision be illegal, and if so, are those workers not members of a union entitled to refunds after that date?

CSEA’s Cantore said the union is in the position to refund fees that may have been paid to affected workers after the court’s decision.

The various government payroll offices, such as the state Comptroller’s Office, act as pass-through vehicles for the agency fees collected in the past. The fee – the same as the basic union membership before any added-on assessments for full-fledged union members – gets tacked onto each covered person’s paycheck, and the funds are then disbursed to the correct union.

In Erie County, about 700 workers are due to see agency fees they have been charged drop off their pay stub with the next payday on July 13. For the prior payroll date on June 30, which was after the Supreme Court decision, the agency fees were included on their paychecks because the payroll had been processed prior to the court’s ruling, according to Peter Anderson, a spokesman for Erie County Executive Mark Poloncarz.

The state Comptroller’s Office could not provide a dollar amount of agency fees that will no longer be collected in the paychecks of 31,000 state workers. DiNapoli, the state comptroller and a strong ally of organized labor, turned down an interview request.

In Erie County, a breakdown of some information was provided. In all, 390 county workers in the last pay period were assessed a fee that was then passed along to the Teamsters union, which has a big presence in the county Sheriff’s Office.

Erie County Commissioner of Personnel David Palmer said he expects that number to drop sharply as the Teamsters union supplies the county with membership cards confirming people who were charged agency fees are members of the union or the labor group can convince agency fee workers to join the union going forward.

In all, $490,000 was charged in 2017 to Erie County workers who were not members of unions, according to information Palmer supplied. Besides the Teamsters, the unions for county workers are the American Federation of State, County and Municipal Employees; Civil Service Employees Association; New York State Nurses Association; and the Sheriff’s Police Benevolent Association.

Erie County officials said local unions have been reviewing their records since the Janus decision but have not yet forwarded membership card information to the county that might affect agency shop fees or union dues. That has left the county, with this week’s payroll, to end agency fees for individuals for whom there is no record of belonging to a union.

How those numbers might change depends on unions proving that some employees who paid agency fees; some unions were more diligent than others in keeping those membership rolls up to date. Also, on the flip side, it is still too soon to tell how many existing members – now with the mandatory agency fee system ended – will choose to abandon their unions. Going forward, the process is simple, officials said: county employees will not pay anything additional – with proceeds going to a union – unless there is proof of membership in a union.

“I think the county will figure it out. The unions will figure it out. What remains to be seen is what over time is going to be the long-term effect,’’ Palmer said.

Some local and state government entities – including the Buffalo school district and the state Thruway Authority – either did not respond to requests for information or were unable to provide details about how many employees were paying agency fees prior to the Janus ruling.

Richard Updegrove, the Niagara County manager, said he spent much of Tuesday meeting with lawyers to review the county's responsibilities following the Janus ruling. He said he could not comment on what actions the county has or will take until he could talk to union leaders sometime this week.

"We're going to comply with the law,'' Updegrove said, which he added means that there has to be a specific authorization from an employee in order for union dues to be deducted from his or her paychecks. He said he could not yet give specific numbers about agency fees paid by employees.

At Roswell Park Comprehensive Cancer Center, a public benefit corporation, $207,000 in agency fees were collected in 2017 on 664 employees who did not actively join a union, officials said. The facility has stopped collecting the fees since the Janus ruling.

City of Buffalo officials said that 17 people on its government workforce paid agency shop fees totaling $12,000 annually. The city, which noted $3.3 million is collected by city unions annually in direct deductions from workers' paychecks, did not say if or when it has stopped charging for the small number of employees who did not join a union but who had agency fees deducted.

At the Erie County Medical Center Corporation, $193,000 was deducted in agency fees that were paid to unions in 2017; 835 full- and part-time employees at some point in 2017 paid agency fees instead of union dues, according to corporation spokesman Peter Cutler. The public corporation has 3,234 unionized employees and 200 pay agency fees.

Cutler said ECMC stopped collecting agency fees as of June 27 and is auditing its books to see if anyone was missed and might be owed a refund. Union dues at ECMC range from $18.21 per week for full-time members of the nurses’ union to $9.43 for part-time employees who belong to AFSCME.

Ken Girardin, policy analyst at the Empire Center, compiled information for 2016 that showed agency shop fees totaled $192,000 at ECMC, $244,000 at Roswell and the Buffalo schools – at $4 million – provided only combined agency fee and dues figures from nonunion members and union members. In Niagara County, he said, $41,000 was assessed in agency fees in 2016, while Chautauqua County workers not enrolled in a union had $64,000 in agency fees deducted on their paychecks.

Statewide in all levels of governments, he estimated more than 200,000 workers will see an effect from the end of the agency fee system.

“It’s important that local governments comply immediately because they’re risking litigation every day they wait," Girardin said of the Supreme Court’s demand that the agency shop fees are halted.

State eliminates agency fees

The financial effects on unions are already starting. Freeman, from the Comptroller’s Office, said the 31,000 workers seeing an end to their agency fee payments is out of a state workforce of 255,000 people. That total number, though, includes people not in unions and who did not already have agency fees deducted, such as political appointees, thousands of people employed by the Legislature and others. It also does not include state authorities – such as the Thruway Authority or Power Authority, whose payrolls are not processed by DiNapoli’s office.

The union losing the most state workers paying agency fees: the Professional Staff Congress, which represents faculty and others at the City University of New York. In all, 9,852 workers whose agency fees were going to that union will see those fees end this week or next, according to the state Comptroller’s Office. Number two on the list: CSEA, which is seeing halted agency shop fees from 6,311 state workers.

Mario Cilento, president of the state AFL-CIO, said in an email response Tuesday that the Janus decision was well-anticipated. “We are well prepared,’’ Cilento said.

Cilento said unions have bolstered one-on-one communications with members. “What we have going for us is that our members recognize that union members make, on average, $11,000 more a year than their nonunion counterparts and that they are far more likely to have job-provided health insurance and a guaranteed pension,’’ he said.

Cilento said union members in New York see the Janus ruling as “an attack on working people” and, moreover, that 75,000 union members were added in New York State last year.

“As far as the impact on any loss of revenues, a ‘blip’ is expected, but I can assure you our affiliates have prepared for that and in the end we will continue to organize working people across this state and country," Cilento said.

There are no comments - be the first to comment