Appeals judges: Lincolnshire, other towns can't create right-to-work zones, despite home rule powers

By Jonathan Bilyk | Oct 1, 2018

Lincolnshire Village Hall   By Racaris (Own work) [Public domain], via Wikimedia Commons

Saying to find otherwise would create “catastrophic” consequences for labor law in Illinois and across the country, a federal appeals panel has backed a federal judge’s decision to toss an attempt by a northwest suburban village to use its home rule powers to create a local right-to-work zone within its borders.

On Sept. 28, a three-judge panel of the U.S. Seventh Circuit Court of Appeals sided with labor unions who had sued the village of Lincolnshire, finding the village’s so-called local right-to-work ordinance exceeds the village’s authority to regulate labor and employment in the village under the federal National Labor Relations Act.

Under an amendment to the NLRA known as Section 14(b), Congress altered the law in decades past to grant states the authority to decide for themselves whether to exempt their employers within their borders from the need to comply with so-called “union security agreements” - provisions in collective bargaining agreements which effectively allow unions to force employees working at certain companies to join a union, and which compel employers to collect dues and fees on the union’s behalf.

But the Seventh Circuit panel said it did not believe Congress intended to allow cities and villages or other “political subdivisions” within a state to establish right to work zones, even if those “subdivisions” otherwise exercised powers also wielded by the state, as do Illinois home-rule communities, like Lincolnshire.

“Labor law is one of the rare areas in which Congress has preempted the field, and so states have no power in the area except with respect to their own employees,” the judges wrote.  “True, section 14(b) cedes some power back to the states, but it makes no sense to say that states can re-delegate that power.

“…No one would be able to figure out what is legal and what is not.”

However, the Seventh Circuit’s decision comes as just the latest bout in a wide-ranging battle over this question.

For instance, last year, the U.S. Sixth Circuit Court of Appeals in Cincinnati came to the opposite conclusion on the question.

The differing opinions may set up a clash at the U.S. Supreme Court, a proceeding which Lincolnshire’s lawyers from the Chicago-based nonprofit Liberty Justice Center said they will seek.

“We now have a split between the Sixth and Seventh Circuit Courts, which presents us with the opportunity to appeal this case to the U.S. Supreme Court,” said Liberty Justice Center spokesperson Diana Rickert. “We intend to do so.”

Lincolnshire had been sued in 2015 by a collection of labor unions after enacting the ordinance effectively designating the village a local right-to-work community, despite no state law authorizing such local right-to-work zones.

More than half of U.S. states have enacted statewide right-to-work laws, taking advantage of the exemption in Section 14(b) of the NLRA. Neighboring Illinois states, including Indiana, Iowa, Kentucky, Wisconsin and Michigan, have all enacted right-to-work laws.

Lincolnshire asserted it had the power as a home rule community under Illinois’ state constitution to assume for itself the powers delegated to the state under Section 14(b) to enact the local right to work ordinance village leaders said was needed to attract and retain employers within the community.

Elsewhere in Illinois, other home rule communities, including the city of Chicago and Cook County, have each used their home rule powers to enact a range of regulations on employers, including mandates for paid time off and minimum wages higher than what is required by the state.

Lincolnshire’s ordinance landed before the Seventh Circuit last summer, however, when U.S. District Judge Matthew F. Kennelly found Lincolnshire’s ordinance ran afoul of the NLRA. Allowing such ordinances, Kennelly said, would create a “patchwork scheme” of labor regulation across the country that was never intended by federal lawmakers.

And in their Sept. 28 opinion, three Seventh Circuit judges reached similar conclusion to Kennelly’s.

The opinion was authored by Seventh Circuit Chief Judge Diane P. Wood, with circuit judges William J. Bauer and Michael S. Kanne concurring.

In the opinion, Wood acknowledged the Sixth Circuit’s contrary decision, but said the Seventh Circuit believes their Sixth Circuit colleagues erred in applying two U.S. Supreme Court decisions, including the 1991 decision in Wisconsin Public Intervenor v Mortier and the 2002 decision in City of Columbus v Ours Garage & Wrecker Service.

Judge Wood said those decisions dealt with federal laws that did not clearly indicate the desire of lawmakers to preempt the “police powers” of state governments, nor of their “subdivisions.” But when dealing with the NLRA, Judge Wood said she and her Seventh Circuit colleagues believe Section 14(b) should be treated differently, as “an exception to the general preemption established in the (NLRA) for the field of labor relations.”

“…Sometimes Congress allows redelegation, … and sometimes it does not,” Judge Wood wrote. “The aspect of labor law governed by section 14(b) of the NLRA, we conclude, falls in the latter category.”

The Seventh Circuit judges said they believed interpreting Section 14(b) as desired by the village of Lincolnshire would “do violence to the broad structure of labor law,” while creating “administrative nightmares” across the country. They said they believed the NLRA should be interpreted to require right to work questions to be answered at the state level.

“It would be impossible as a practical matter for a collective bargaining agreement to account for each jurisdiction’s ordinances,” Judge Wood wrote. “Could an employer be held liable for committing an unfair labor practice for refusing to engage in a separate round of horse-trading with workers in each locale? Has a Lincolnshire employer who just landed a lucrative contract in Chicago committed a criminal violation in Lincolnshire because it has agreed to join a multi-employer bargaining unit with an agency-shop rule that is legal at the work situs? As a practical matter, would bargaining units be limited to individual municipalities? What happens to employees who move regularly between job sites? Is a manufacturer precluded from shifting its employees between assembly lines if they would cross into a different municipality’s right-to-work régime?

“Permitting local legislation under section 14(b) threatens ‘a crazy-quilt of regulations.’”

The judges also noted they had distributed their decision to all of the judges on the Seventh Circuit before publishing the opinion, and none of those judges had indicated a desire to rehear the case en banc, before a full panel including all of the Seventh Circuit’s judges.

The union plaintiffs suing the village were represented by attorney James Coppess, associate general counsel for the AFL-CIO.


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Organizations in this Story

AFL-CIO Liberty Justice Center U.S. Court of Appeals for the Seventh Circuit U.S. Court of Appeals for the Sixth Circuit U.S. District Court for the Northern District of Illinois U.S. Supreme Court Village of Lincolnshire

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