Michigan Joins Indiana in “Right-to-Work”
In less than twelve months, two Midwestern states long known for their unionized workforces have passed legislation that prevents agreements requiring union membership and the payment of union dues as a condition of employment. First, on February 1, 2012, Governor Mitch Daniels signed Indiana’s “Right-to-Work” bill into law to become the nation’s 23rd Right-to-Work state. Now, Michigan becomes the 24th state to make this important move affecting workers’ rights.
Right-to-Work Becomes Law in Michigan
On December 11, 2012, Michigan became the 24th state to enact “Right-to-Work” legislation with Governor Rick Snyder’s signature on Senate Bill No. 116 (private sector employees) and House Bill No. 4003 (public sector employees). Governor Snyder commented that the failed ballot proposal to enshrine collective bargaining rights in the Michigan Constitution triggered the discussion that led to the swift passage and signing of the new law. Under the Michigan Constitution, the new law is to take effect upon the expiration of 90 days from the end of the session at which it was passed. Consequently, we expect that the effective date will be some time near April 1, 2013.
The Key Provisions of the Michigan Right-to-Work Law
- The law applies to all employees in Michigan except public police and fire department employees, federal government employees, executive and supervisory employees, agricultural and domestic service employees, any person employed by his or her parents or spouse and any employees subject to the Railway Labor Act.
- Based on the law, an individual cannot be required as a condition of obtaining or continuing employment to:
- Become or remain a member of a labor organization
- Refrain or resign from membership in a labor organization
- Pay any dues, fees, assessments or other charges or provide anything of value to a labor organization
- Pay to any charity or third party an amount in lieu of dues or other charges required of employees represented by a labor organization.
- The law also prohibits a person from forcing, intimidating or making threats to compel or attempt to compel another person to become or remain a member of a labor organization or pay any dues/fees to a charitable organization or third party in lieu of union dues.
- An agreement, contract or practice between an employer and a labor organization that violates the provisions in Section 1 (above) is unlawful and unenforceable.
- The law applies only to an agreement/contract that takes effect or is extended or renewed after the effective date of the Act.
- A person, employer or labor organization that violates the Act is liable for a civil fine of not more than $500.00.
- The law creates a private cause of action for any person that suffers an injury as a result of a violation or threatened violation.
- The law appropriates $1 million to the Department of Licensing and Regulatory Affairs to implement the Act. The appropriation is significant because it means the law cannot be reversed by voter referendum.
Important Considerations for Michigan Employers:
- Remember the law does not apply to currently existing collective bargaining agreements (“CBAs”) – at least not until they expire. While waiting for the bargaining contract to expire or be modified, employees have the right to resign their union membership and pay only the portion of union dues that is spent on bargaining-related activities.
- Employees may have to follow union bylaws to resign from the union. They may have to provide advance notice, be current on dues and assessments, consider possible loss of union pension when no longer a union member and pay an initiation fee to rejoin the union later.
- Employers with CBAs may want to consider providing information to employees about the new Right-to-Work law.
- Employers in negotiations for first time CBAs should consider backing away from any tentative agreement on a Union Security Clause.
- Employers currently in negotiations or about to start negotiations should be prepared for the union’s push to complete negotiations before the effective date of the law.
- Employers in negotiations may now lose some leverage in bargaining for strong Management’s Rights clauses in exchange for agreeing to Union Security and Check Off, as was often the case before Right-to-Work.
- Be wary of any proposal that would allow reversion to Union Security or reopen the CBA if there is a change in the Right-to-Work law in the future.
- Managers and supervisors should be educated about the implications of Right-to-Work so that they can effectively address employee questions and confront any union arguments.
If there are any questions, please contact Bruce Bagdady at bbagdady@wp.hallrender.com or your regular Hall Render attorney.
