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PAUL H. ROBINSON 206 EAST COULTER AVE. COLLINGSWOO

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY


September 28, 1982

PAUL H. ROBINSON CLIFFORD OWENS, PAUL B. KELLEY, ALLAN ROTH, CLAVIN W. CORMAN, EARL MALTZ, ELIHU ABRAHAMS, ARNOLD GLASS, CHARLES W. UPTON, ALEX W. WYPYSZINSKI, MICHAEL CREW, HAROLD ZAPOLSKY, JACKSON TOBY, Dept. of Sociology, Rutgers University, Murray Hall 026, New Brunswick, NJ 08903, Plaintiffs,
v.
STATE OF NEW JERSEY, THOMAS H. KEAN, GOVERNOR State House Trenton, NJ 80625, JAMES W. MASTRIANI, Chairman Public Employment Relations Commission 429 East State St. Trenton, NJ 08608, EDWARD J. BLOUSTEIN, President and Individually Rutgers State University New Brunswick, NJ 08903, RUTGERS UNIVERSITY, BOARD OF GOVERNORS State Dept. of Higher Education c/o Edward T. Hollander 225 West State Street Trenton, NJ 08625, Mr. JAMES A. GORMLEY, Director of Personnel and Individually Rutgers University (Camden) Camden, NJ 08102, CHRISTINE MOWRY, Director of Office of Employee Labor Relations and Individually Rutgers University, New Brunswick, NJ 08903, RUTGERS COUNCIL, AAUP and Ms. SANDRA WALTHER, Executive Director, Rutgers Council, American Association of University Professors (AAUP), and Individually, Bldg. 4103, Kilmer Campus Rutgers University New Brunswick, NJ 08903, RICHARD PESKIN, President and Individually Rutgers Council of AAUP Bldg. 4103, Kilmer Campus Rutgers University New Brunswick, NJ 08903, RICHARD LAITY, Chairman and Individually AAUP Legislative Relations Committee Kilmer Library 7 Thrush Mews North Brunswick, NJ 08902, AAUP and Irvin J. Spitzberg, Jr., General Secretary AAUP One DePont Circle, Suite 500 Washington, D.C. 20036, Defendants; JOSEPH W. ANTONACCI, MEVERIL JONES, THOMAS GAY, JOHN RUSSELL, RICHARD H. TREXLER, A. WILLIAM ONDER, LEON MATELSKI, EDWARD JAKUBCO, Mrs. DOROTHY GRAY and Mr. WILLIAM F. GRAY, Plaintiffs, v. STATE OF NEW JERSEY, THOMAS H. KEAN, Governor of New Jersey State House, Trenton, NJ 08625, JAMES W. MASTRIANI, Chairman and Individually Public Employment Relations Commission 429 East State Street Trenton, NJ 08068, WESTFIELD EDUCATION ASSOCIATION, SALLY VEJNOSKA, President and Individually Westfield Education Association 113 Central Avenue Westfield, NJ 07090, UNION COUNTY EDUCATION ASSOCIATION 524 South Avenue Cranford, NJ 07016, WESTFIELD BOARD OF EDUCATION, DR. L. F. GREENE, Superintendent and Individually Westfield Board of Education Administration Building 302 Dome Street Westfield, NJ 07090, ROBERT WESTKERNA PASCACK VALLEY REGIONAL EDUCATION ASSOCIATION Pascack Hills High School Montvale, NJ 07645, PASCACK VALLEY REGIONAL EDUCATION ASSOCIATION, DAVID T. DIERKER, President and Individually Pascack Valley Regional Education Association Pascack Hills High School Montvale, NJ 07645, BERGEN COUNTY EDUCATION ASSOCIATION 137 Bergen Mall Paramus, NJ 07652, PASCACK VALLEY REGIONAL BOARD OF EDUCATION, Mrs. LAURIE THORNTON, President and Individually Board of Education Pascack Valley Regional High School District 40 Acres Avenue Montvale, NJ 07645, AURORA BERNARD-SALIT, President and Individually EDISON TOWNSHIP EDUCATION ASSOCIATION 200 Lincoln Highway Edison, NJ 08817, MIDDLESEX COUNTY EDUCATION ASSOCIATION, MARIA VERSOCKI, President and Individually Middlesex County Education Association 1014 Livingston Ave. North Brunswick, NJ 08902, EDISON TOWNSHIP BOARD OF EDUCATION, CHARLES A. BOYLE, Superintendent Edison Township Board of Education, and EDISON TOWNSHIP BOARD OF EDUCATION 100 Municipal Boulevard Edison, NJ 08817, RIDGEWOOD EDUCATION ASSOCIATION, FRANK SIDOTI, President and Individually Ridgewood Education Association 49 Cottage Place, Ridgewood, NJ 07450, RIDGEWOOD BOARD OF EDUCATION, ROSEMARIE SCHUTT, President, Board of Education, Ridgewood Public Schools, and Individually 49 Cottage Place Ridgewood, NJ 07450, TOWNSHIP OF OCEAN TEACHERS ASSOCIATION, ELIZABETH CAMPANILE, President and Individually Township of Ocean Teachers Association 202 Sea Girt Sea Girt, NJ 08750, TOWNSHIP OF OCEAN BOARD OF EDUCATION, JAMES F. JEFFRIES, President, Board of Education, and Individually Township of Ocean School District Oakhurst, NJ 07755, NEW JERSEY EDUCATION ASSOCIATION, EDITH FULTON, President and Individually New Jersey Education Association 180 West State Street Trenton, NJ 08687, NATIONAL EDUCATION ASSOCIATION, WILLARD H. MCGUIRE, President National Education Association 1201-16th Street, N.W. Washington, D.C. 20036, Defendants

The opinion of the court was delivered by: DEBEVOISE

DEBEVOISE, District Judge.

 I. The Proceedings

 These two consolidated actions each challenge the constitutionality of provisions of the New Jersey Employer-Employee Relations Act, N.J.S.A. 34:13A-1, et seq. (the Act), which permit public employers to withhold and majority union representatives to receive representation fees assessed against employees who are not members of the union. Plaintiffs moved for preliminary injunctive relief; a hearing was held; and this opinion constitutes my findings of fact and conclusions of law.

 II. The Statute

 The Act creates a Division of Public Employment Relations within the executive branch, N.J.S.A. 34:13A-5.1, and establishes in that division a New Jersey Public Employment Relations Commission (PERC), N.J.S.A. 34:13A-5.2. PERC is required "to make rules and regulations" and to implement fully all the provisions of this act". PERC is granted exclusive jurisdiction over unfair practices, N.J.S.A. 34:13A-5.4c. The Act grants and protects the right to freely join or assist or to refrain from joining or assisting any employee organization, N.J.S.A. 34:13A-5.3, and prohibits restraint of those rights, N.J.S.A. 34:13A-5.4(a) (1) & (b) (1).

 The Act designates the majority representative the exclusive representative to negotiate the terms and conditions of employment of an employee unit, N.J.S.A. 34:13A-5.3 (para. 2).

 

A majority representative of public employees in an appropriate unit shall be entitled to act for and to negotiate agreements covering all employees in the unit and shall be responsible for representing the interest of all such employees without discrimination and without regard to employee organization membership . . . In addition, the majority representative and designated representatives of the public employer shall meet at reasonable times and negotiate in good faith with respect to grievances and terms and conditions of employment.

 

When an agreement is reached on the terms and conditions of employment, it shall be embodied in writing and signed by the authorized representatives of the public employer and the majority representative.

 Effective July 1, 1980, New Jersey amended the Act to permit public employers and majority representatives of employees to negotiate contract provisions which would require employees who choose not to join the majority representative to pay a representation fee in lieu of dues. P.L. 1979, c. 477, N.J.S.A. 34:13A-5.5 to 5.9. The purpose of the amendment was to require the non-members to bear a fair share of the expenses incurred in representing their interests during negotiations with their employer. The Sponsor's Statement to Assembly Bill No. 688, February 9, 1978, expressed this objective as follows:

 

For many years, the 'New Jersey Employer-Employee Relations Act' has required that a majority representative of public employees which has negotiated a labor agreement covering such employees to represent the interests of all employees in the bargaining unit, regardless of organizational membership, without discrimination. Non-members of the majority organization, therefore, enjoy virtually equal benefits and protections without sharing in the costs, incurred by collective negotiations, grievance representation, and other services. In the recent May, 1977 decision of the United States Supreme Court (Abood et al. v. Detroit Board of Education et al.) which upheld the constitutional validity of state 'agency shop' legislation, the Court pointed to the fact that the tasks of negotiating and administering an agreement are continuing and difficult ones and entail the expenditure of much time and money, often requiring the services of lawyers, expert negotiators, economists, research staff, as well as administrative personnel. In that decision, the Court went on to state that 'a union shop arrangement has been thought to distribute fairly the cost of these activities among those who benefit, and it counteracts the incentive that employees might otherwise have to become "free riders" -- to refuse to contribute to the union while obtaining benefits of union representation that necessarily accrue to all employees'. Many analysts feel that union security agreements such as the agency shop are vital to the stability and sense of responsibility of public sector unions.

 N.J.S.A. 34:13A-5.5(a) authorizes a majority representative and a public employer to include in a collective agreement a provision requiring all employees in the negotiations unit who are not members of the majority representative to pay the majority representative a representation fee in lieu of dues for services rendered by the majority representative. N.J.S.A. 34:13A-5.5(b) provides that the representation fee "shall be in an amount equivalent to the regular membership dues, initiation fees and assessments charged by the majority representative to its own members less the cost of benefits financed through the dues, fees and assessments and available to or benefitting only its members, but in no event shall such fee exceed 85% of the regular membership dues, fees and assessments ". (Emphasis added.) The Act does not define benefits available to or benefitting only the majority representative's members. However, the Statement of the Assembly Labor Committee to Assembly Bill No. 688, June 19, 1978, referred to the cost of any other benefits available only to members and gave as examples "contributions to charitable or religious organizations or causes; fines, penalties or damages arising from unlawful activities of a bargaining agent; social or recreational activities, costs of educational activities unrelated to collective negotiations, contract administration or lobbying for improved wages and benefits; costs of medical insurance; retirement benefits or other benefit programs; and costs incurred by the bargaining agent to organize employees who are not included in the bargaining unit".

 It would appear that in arriving at the representation fee it is not required (although it would be permissible) to deduct from membership dues the employee's pro rata share of expenditures by the majority representative for political or ideological causes or for lobbying. That subject is covered in N.J.S.A. 34:13A-5.5(c).

 That section provides that "any public employee who pays a representation fee . . . shall have the right to demand and receive from the majority representative . . . a return of any part of that fee paid by him which represents the employee's additional pro rata share of expenditures by the majority representative that is either in aid of activities or causes of a partisan political or ideological nature only incidentally related to the terms and conditions of employment or applied toward the cost of any other benefits available only to members of the majority representative". A payor of a representation fee does not have the right to demand a refund of his pro rata share of "the costs of support of lobbying activities designed to foster policy goals in collective negotiations and contract administration or to secure for the employees represented advantages in wages, hours, and other conditions of employment in addition to those secured through collective negotiations with the employer". Thus there is potentially a very broad area of lobbying activities for which the funds of non-members can be spent without the right to a refund. This gives rise to one of the areas of controversy in this case.

 The public employer deducts the representation fee from the paychecks of non-members and forwards the deductions to the majority representative. N.J.S.A. 34:13A-5.6.

 N.J.S.A. 34:13A-5.6 prohibits the deduction of representation fees unless the majority representative has established and maintained a demand and return system which provides pro rata returns as described in N.J.S.A. 34:13A-5.5(c). The majority representative's demand and return system must include a provision permitting non-members to obtain review of the amount returned through full and fair proceedings. The majority representative bears the burden of proof. N.J.S.A. 34:13A-5.6. If dissatisfied with the result of demand and return system proceedings, a representation fee payer may appeal to a three-member board whose members the Governor appoints with the Senate's advice and consent. N.J.S.A. 34:13A-5.6. One member of this board must be a reprsentative of public employers, one a representative of public employee organizations, and one, the strictly impartial chairman, is the representative of the public interest.

 Issues in this case include (i) whether any demand and return system can validate a compulsory non-member fee, part of which is used until the time of its return to promote organizations and causes with which the non-member disagrees and (ii) whether, if some forms of demand and return systems are valid, this particular system is invalid because it places such onerous burdens on the non-member seeking a refund. An examination of the facts developed in the consolidated cases now before the Court throws light upon these issues.

 III. Robinson v. New Jersey

 Plaintiffs in the Robinson case are thirteen professional employees of defendant Rutgers University. They are not members of defendant Rutgers Council, American Association of University Professors (AAUP), which acts as exclusive representative of the employees in the bargaining unit of which plaintiffs are a part.

 Defendants in Robinson include the State of New Jersey and its Governor, the Chairman of PERC, Rutgers University and its Board of Governors and various of its officers having labor relations duties, the Rutgers Council of AAUP and various of its officers, and the National AAUP and its General Secretary.

 Extensive affidavits have been filed by or on behalf of plaintiffs and defendants and there can be little, if any, dispute as to the facts pertinent to the disposition of the application for a preliminary injunction.

 AAUP is a national organization of teachers and research scholars in universities and colleges and in professional schools of similar grade. Its governing body is a Council whose members are certain present and past officers, the Chairman of the Collective Bargaining Congress and thirty elected members. The Council establishes membership dues, subject to ratification at the annual meeting of AAUP.

 Whenever the active members of AAUP in a given institution numbers seven or more, they may become a chapter of AAUP. A chapter may establish local membership dues.

 According to AAUP's chief executive officer, "AAUP is not, and has never been, a national labor organization. It does not engage in collective bargaining on behalf of anyone. In 1973, the AAUP Annual Meeting endorsed collective bargaining as a legitimate way to achieve the Association's goals, and agreed to provide assistance in pursuing collective bargaining to local chapters." (Spitzberg Aff., paras. 3,4.)

 AAUP requires that collective bargaining chapters which collect agency shop fees (representation fees) be required to transmit to the national organization an amount equal to full national dues "or a prorated share based on local assessments" (Spitzberg Aff., para. 7). According to AAUP's chief executive officer, "local chapters of the AAUP engaged in collective bargaining have full responsibility for the negotiation and implementation of their collective bargaining agreements," but nevertheless "virtually all activities of the AAUP support the efforts of its local chapters engaged in collective bargaining" (Spitzberg Aff., paras. 8,9).

 Be that as it may, an examination of the record demonstrates that National AAUP engages in at least some lobbying at the federal and state levels *fn1" and that significant funds are spent for activities which the Statement of the Assembly Labor Committee to Assembly Bill No. 688, June 19, 1978 gave as examples of benefits available only to members, e.g., costs of educational activities unrelated to collective negotiations and costs incurred to recruit members.

 There is a Rutgers Council of AAUP Chapters (Rutgers AAUP) serving as the negotiating representative for faculty members and teaching and graduate assistants at Rutgers, The State University. The constituent chapters of the Council are located at Camden, Newark and New Brunswick. An Executive Council has the responsibility to establish dues subject to approval of the membership.

 In early 1980, after enactment of the amendments to the Act but before the effective date of the amendments (July 1, 1980), Rutgers AAUP sought and obtained from its legal counsel advice as to how it should proceed to take advantage of the new provisions. Counsel advised that it would be proper to negotiate an agreement requiring a representation fee provided the agreement did not become effective before July 1, 1980. As to calculating the representation fee, counsel recommended that first it was necessary to compute all dues and other charges assessed against members, including membership dues in the national organization if such membership was required of all members. Then, counsel advised, two categories of expenses had to be deducted to determine what amount could be charged to non-members: (i) amounts spent in aid of activities or causes of a partisan political or ideological nature only incidentally related to the terms and conditions of employment *fn2" and (ii) amounts expended for benefits available only to members of the majority representative.

 Counsel advised that not all expenses for lobbying activities should be excluded from the representation fee: "Other political activities, of a nonpartisan or nonideological nature should, however, be included. As the bill itself notes, chargeable items should include 'the cost for support of lobbying activities designed to foster public policy goals and collective negotiations and contract administration or to secure for the employees represented advantages in wages, hours, and other conditions of employment in addition to those secured through collective negotiations with the public employer' . . . The union should not exclude sums spent on such activities as testimony before legislative finance committees, mailings to citizens seeking support of union demands or other political activities directly related to collective bargaining."

 To provide guidance to Rutgers AAUP in determining what constituted member-only benefits counsel listed (with two exceptions) the kinds of expenditures which were set forth in the Assembly Labor Committee Statement referred to above. Counsel noted that the statement had listed among the member-only benefits expenses to administer the contract and for lobbying. However, counsel observed that after the presentation of the Assembly Labor Committee Statement the proposed amendment to the Act had been revised specifically to permit such expenses to be included in the representation fee.

 Counsel noted that under the statute the representation fee could not exceed 85% of charges to members and then stated: "Experience in other states has demonstrated that an 85% fee is defensible; therefore we suggest that that amount be the established representation fee." This is a somewhat surprising recommendation. The opinion letter had gone on for several pages to urge meticulous record-keeping and had defined carefully just what expenditures should and should not be included in the representation fee. To then recommend reliance on totally unidentified and unanalyzed "experience in other states" which had proved to be "defensible" seems inconsistent with all the preceding advice.

 In any event, in the spring of 1980 Rutgers AAUP prepared to negotiate for contract provisions requiring payment of a representation fee. In May, 1980, before such an agreement had been negotiated, the Rutgers AAUP Council adopted a budget for fiscal year 1980-81 based entirely on member revenue. The budget anticipated total revenues of $167,500 from which there was deducted $45,000 representing National AAUP dues, for net revenues for the use of Rutgers AAUP of $122,500. Total expenditures were projected at $125,879.

 In early June Rutgers AAUP's Executive Director advised the President and President-Elect that an "expanded" budget should be prepared in anticipation of receipt of additional revenues, in the form of representation fees; that expenditures should be separated so as to identify those benefitting members-only and those benefitting all persons in the bargaining unit, and that a representation fee should be established.

  In response to the Executive Director's suggestions committees were appointed to make recommendations as to a revised dues structure and as to a new budget which would reflect the receipt of representation fees. These two committees reported to the Council's July 30, 1980 meeting.

 The budget committee anticipated that $157,100 would be received in representation fees (almost doubling the income projected in the May, 1980 budget) and proposed how that amount should be spent. It proposed adding to the May membership-only budget the following:

 

$ 16,000 additional legal expenses;

 

$ 3,750 additional temporary office help;

 

$ 10,950 additional administration expenses;

 

$126,400 additional program expenses.

  The new programs were to be: Subscriptions $ 600 Grievance support services 26,800 Newsletters and printing 2,500 Released time for AAUP President 8,000 Computer services 2,500 Travel and meetings 2,500 Special programs 1,000 Health and occupational safety study 3,000 Contingency fund 7,000 National services (i.e., payment to National AAUP) n3 72,500 Total $126,400

19820928

© 1992-2004 VersusLaw Inc.



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