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Statutory Interpretation – Taft‐Hartley Act – Dues-checkoff Authorizations

By: Derek Hawkins//October 3, 2018//

Statutory Interpretation – Taft‐Hartley Act – Dues-checkoff Authorizations

By: Derek Hawkins//October 3, 2018//

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7th Circuit Court of Appeals

Case Name: International Association of Machinists District Ten, et al. v. Ray Allen, et al.

Case No.: 17-1178

Officials: MANION, ROVNER, and HAMILTON, Circuit Judges.

Focus: Statutory Interpretation – Taft‐Hartley Act – Dues-checkoff Authorizations

Wisconsin’s Act 1 of 2015, codified at Wis. Stat. § 111.01 et seq., changed many provisions of that State’s labor laws. This case deals with a narrow provision of Act 1 that attempts to change the rules for payroll deductions that allow employees to pay union dues through dues‐checkoff authorizations.

A dues‐checkoff authorization is a contract between an employer and employee for payroll deductions. These are “arrangements whereby [employers] would check off from employee wages amounts owed to a labor organization for dues, initiation fees and assessments.” Felter v. Southern Pacific Co., 359 U.S. 326, 330–31 (1958). By signing an authorization, the employee directs the employer to deduct union dues or fees routinely from the employee’s paycheck and to remit those funds to the applicable union. Many of these authorizations are irrevocable for a specified period—often one year— for reasons of administrative simplicity. See Dkt. 43 at 2 (Elizondo Aff.); see also N.L.R.B. v. Atlanta Printing Specialties and Paper Prods. Union 527, 523 F.2d 783, 786 (5th Cir. 1975). The union itself is not a party to the authorization, which is effective if and only if the employee wishes. Federal law has long provided, however, that unions can bargain collectively with employers over the standard terms of dues‐checkoff authorizations.

The Taft‐Hartley Act imposes three limits on dues‐ checkoff authorizations: the authorization must be (1) individual for each employee, (2) in writing, and (3) irrevocable for no longer than one year. See 29 U.S.C. § 186(a)(2), (c)(4). Wisconsin’s Act 1 attempts to shorten this maximum period to thirty days. See 2015 Wis. Act 1, § 9, codified at Wis. Stat. § 111.06(1)(i).

The district court found that Wisconsin’s attempt to impose its own time limit on dues‐checkoff authorizations is preempted by federal labor law, and the court issued a permanent injunction barring enforcement of that provision. International Ass’n of Machinists District 10 v. Allen, No. 16‐cv‐77, 2016 WL 7475720, at *7 (W.D. Wis. Dec. 28, 2016). We affirm.

Affirmed

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.

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