LINCOLNSHIRE, Ill. (Legal Newsline) — To stop the flow of manufacturing jobs out of Illinois, policy experts and reformers in the state, including Gov. Bruce Rauner, have pointed to enacting right-to-work laws that seem to do the trick in nearby states.
To get that ball rolling, Lincolnshire — a village two hours north of Chicago — passed a right-to-work ordinance a year ago. The ordinance states that employees at private-sector companies in Lincolnshire can refuse to pay union dues or fees.
But in February, just two months after the ordinance was enacted, four unions representing engineers, construction workers and carpenters filed a lawsuit challenging the legality of the local ordinance. The lawsuit is pending in federal court.
A similar case stemming from a local right-to-work ordinance enacted in Hardin County, Kentucky, could impact Lincolnshire’s case. On Nov. 18, a three-judge panel of the U.S. Court of Appeals for the Sixth Circuit ruled that such local plans don’t violate federal law.
This is good news for Illinois, said Jacob Huebert, senior attorney at the Liberty Justice Center. The LJC describes itself as a non-partisan public interest litigation center.
“The court rightly recognized that states may delegate their authority to enact right-to-work laws to local governments,” Huebert said. “We're hopeful that the federal trial court in Chicago and the Seventh Circuit Court of Appeals (which covers Illinois, Indiana and Wisconsin) will agree with the Sixth Circuit's conclusion that local governments may enact right-to-work laws as long as it's within their authority under state law.”
The case in Hardin County
Three Republican-appointed judges in the Sixth Circuit in Cincinnati concluded that Hardin County can ban agreements between employers and unions that force workers to join and pay dues. Such agreements are called union security agreements.
The ruling overturned a decision by Louisville, Ky., federal judge David Hale, who was appointed by President Barack Obama, demonstrating the political divide on the issue. Hale had granted summary judgment, agreeing with the unions that the National Labor Relations Act preempts the ordinance.
The three-judge panel determined that the NLRA makes an exception for state laws regarding right-to-work, giving counties the same rights as states to enforce such laws. The plaintiffs will likely appeal the decision to the entire appellate court.
In Kentucky, where lawmakers have tried and failed to pass a statewide right-to-work law, several counties vying for manufacturing jobs passed local ordinances to make them more attractive to companies. About a dozen counties have passed ordinances since December 2014.
The ruling became the first at the federal appellate level to rule on the issue, making it likely that it will impact the courts taking up the Lincolnshire case, Huebert said.
Impact in Lincolnshire
Passed in December 2015, the Lincolnshire rule disregarded a formal opinion released months earlier by Illinois Attorney General Lisa Madigan, who said local ordinances are illegal because federal law only allows such labor laws to be passed at the state level.
Madigan wrote that the NLRA preempts “the regulation of union security agreements in all ways that impact interstate commerce.” Such agreements require employees in a unionized workplace to pay dues to the union, which bargains on their behalf, as a condition of employment.
In addition to the village, the lawsuit brought by the Illinois unions names Mayor Elizabeth Brandt, Police Chief Peter Kinsey and Village Clerk Barbara Mastandrea.
If the courts follow the same route as the Sixth Circuit, it probably wouldn’t take long for other local governments in Illinois to pass their own ordinances, said Mark Glennon, a public policy analyst and founder of WirePoints, an Illinois business and economics news website.
So far, 25 states have right-to-work laws, including four of the six that share borders with Illinois. After the November elections, Missouri and Kentucky are poised to pass statewide laws, joining Iowa, Wisconsin, Michigan and Indiana.
“By joining its neighbors as a right-to-work state, a major reason for job losses in Illinois obviously would be gone, especially in manufacturing where unionization is common,” Glennon said. “Illinois has other problems, but right-to-work definitely would make Illinois much friendlier than it is now to employers."
Huebert agreed, adding, “Since Michigan and Indiana adopted right-to-work laws, they've added tens of thousands of manufacturing jobs, while Illinois has lost thousands of manufacturing jobs. Local right-to-work laws could help reverse Illinois' decline in this area.”
Rauner’s so-called Turnaround Agenda calls for establishing right-to-work zones, which Huebert and others believe would help the Illinois business climate.
Rauner’s agenda states that these zones would work around the Democratic supermajority in the General Assembly, where a statewide initiative would never pass. The governor said he thinks local ordinances would appeal most to manufacturing towns in the southern half of the state and along the borders.
The unions challenging Lincolnshire's ordinance had relied upon Hale's judgment when it motioned for summary judgment in their case in June.
Since the Sixth Circuit's decision, Lincolnshire has asked to file the decision with the judge presiding over itse case. The unions agreed it was pertinent to the case.
Also in their motion for summary judgment, the unions argue that Lincolnshire's ordinance is not covered by a shelter from preemption-afforded state right-to-work laws. They say a ruling in favor of the ordinance would be disruptive to their operations.
"Local 150 has several multi-employer collective bargaining agreements covering construction work performed in a nine-county area in northern Illinois," the motion says.
"There are 315 towns, villages, and cities located within this area, several of which have Home Rule authority. Each time one of the covered employers undertook a job within this area, it and the union would have to determine whether there was a valid local Right-to-Work law covering the work in question and, if there were, what precisely the law required."
The unions say Congress foresaw the problem of inconsistent right-to-work requirements in a single collective bargaining agreement and addressed the problem in 1950 with amendments to the Railway Labor Act.
"The Supreme Court has treated the 1950 RLA union security amendments as highly informative with regard to the intent of the 1947 NLRA union security amendments," the unions say.
Rauner also has battled with public employee unions over contract negotiations that he says taxpayers can’t afford. But it’s important to note that the courts upholding a local right-to-work ordinance will only impact private-sector union employees.
Glennon said becoming a right-to-work state would help everybody, contradicting the unions' claims that it will drive down wages.
“That’s debatable,” Glennon said of the unions' claim, “and you really have to look at the longer term and the bigger picture. The exodus of employers has to be stopped.
"Keeping them here and attracting more would help preserve and grow our tax base, which is shrinking right now — and that’s very scary. Illinois unquestionably is doomed unless economic growth is restored, and economic growth won’t be restored unless our jobs climate becomes competitive again.”
Glennon said he isn’t against collective bargaining, which can put workers on an equal playing field when it comes to negotiations.
“But you have to remember that right-to-work doesn’t prohibit collective bargaining or ban unions. In fact, there’s lots more union activity in right-to-work states than commonly known,” he said.
“Higher wages for workers should be everybody’s goal. But the only sustainable way to really drive up wages is to fire up the economy so that employers have to compete for workers and workers have lots of choices. Right-to-work would help get us there.”