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Union Dues Deduction In a Post-Act 10 World

By D&K’s School and Higher Education Law Team

Municipal employers must exercise caution with regard to deducting union dues from employee paychecks. 2011 Wisconsin Act 10 (Act 10) changed the scope of bargaining and representation for public sector employees and their unions. Provisions in Act 10 made it illegal for municipal employers to continue the longstanding practice of allowing employees to pay union dues through a payroll deduction and prohibited fair share union membership. In addition, Act 10 required unions to submit to annual certification elections; the first of which occurred in November and December 2011.

Shortly after Act 10 became effective in June 2011, several unions brought suit in the United States District Court for the Western District of Wisconsin (Court) challenging Act 10 as unconstitutional.

On March 30, 2012, the Court issued its decision, which upheld Act 10’s prohibition against fair share union membership, but found the prohibition against union dues deduction and the requirement of annual certification elections to be unconstitutional. To that end, the Court ordered government employers to reinstate union dues deduction by May 31, 2012, and barred the Wisconsin Employment Relations Commission (WERC) from holding certification elections.

The Court clarified its decision in two subsequent rulings. First, on April 27, 2012, the Court agreed to stay its own order concerning union dues deduction pending appeal for “those bargaining units decertified pursuant to Act 10 before March 30, 2012.” Then, on May 18, 2012, the Court explained that employees must submit proper individual written authorization to employers in order to authorize dues deductions from their paychecks.

This series of rulings has raised a number of issues and generated uncertainty for municipal employers. The situation is clear with respect to municipal employees in bargaining units where the union is no longer certified (whether the union did not file a timely petition for a certification election or failed to obtain the necessary votes in a certification election administered by the WERC). In such situations, municipal employers are not required to restore dues deduction and they are not required to recognize former bargaining representatives as the certified representative for unit employees.

The situation is less clear with regard to municipal employees in bargaining units where the union continues to be certified (whether the union survived an annual certification or never participated in such an election). In such situations, municipal employers may only deduct union dues from employees’ paychecks after receiving proper written authorization from the employee.

As to what constitutes proper written authorization from an employee, it is advisable to obtain a form that explicitly authorizes the deduction of union dues, that identifies the specific dollar amount to be deducted and the entity intended to receive the deducted monies, and, finally, that is signed and dated by the employee. It is also advisable to require employees to execute and submit such forms on an annual basis.

The Court endorsed the use of a form developed by the Wisconsin Law Enforcement Association. However, it is not essential that municipal employers use this form. Davis & Kuelthau has developed a procedure and form for use in circumstances where dues deduction is appropriate. We also have plans to review the authorization forms developed by Wisconsin Education Association Council (WEAC), AFSCME and other public sector unions.

Several unions have been in contact with municipal employers with regard to the issue of union dues deduction. The unions suggest that they will submit to the municipal employer a list of employees who wish to have union dues deducted from their paychecks. It is important to advise the union that the municipal employer will not be able to rely upon a list of names for purposes of union dues deduction and to encourage the union to secure and submit proper written authorization from each employee who wishes to have union dues deducted from his/her paychecks.

Those municipal employers that do not permit payroll deductions for anything other than employer-sponsored fringe benefit contributions, arguably, are not required to honor an employee’s request to deduct union dues from his/her paycheck. For municipal employers in this situation, it is advisable to contact your Davis & Kuelthau, s.c. attorney to discuss the available options and risks.

For those municipal employees in a bargaining unit with a collective bargaining agreement entered into before Act 10 became effective, municipal employers must continue to deduct union dues from employee paychecks in accordance with the terms of the applicable collective bargaining agreement. Such employers must also continue to enforce the fair share membership provisions within the collective bargaining agreement until the agreement expires, or is modified, renewed or extended, whichever occurs first.

As municipal employers begin the process of negotiating new collective bargaining agreements as permitted by Act 10, it may be tempting to incorporate a Union Dues Deduction provision into the new collective bargaining agreement. However, doing so would violate Act 10’s prohibitions against bargaining over anything other than total base wages. As such, it is not advisable to negotiate over such a provision with the union or to include such a provision in the collective bargaining agreement.

Finally, it is important to recognize that the Court’s decision has been appealed to the United States Court of Appeals for the Seventh Circuit. As such, it is possible that the conclusions in this Client Alert may need to be revisited and revised when the Seventh Circuit decision is issued. It is anticipated that the Seventh Circuit will issue a decision in this matter sometime this fall.

We hope that this information is helpful to you. For more information, please contact your Davis & Kuelthau attorney.