Labor & Employment Law Daily No class certification for caregivers seeking refund of ‘fair share’ fees
Monday, October 16, 2017

No class certification for caregivers seeking refund of ‘fair share’ fees

By Ronald Miller, J.D.

The decision of a federal district court to deny certification of a class action of personal home health care assistants who sought the refund of “fair share” fees paid to a union to support its representation of a collective bargaining unit was a sound one, ruled the Seventh Circuit. The appeals court agreed that the proposed class was too broad because it had no way of knowing whether or how many of the class members shared the named plaintiffs’ opposition to the collection of fair-share fees and to collective bargaining representation. Moreover, it concluded that the district court did not abuse its discretion in finding that the named plaintiffs were not adequate class representatives or that common issues did not predominate over individual claims. Judge Manion filed a separate opinion concurring in the judgment (Riffey v. Rauner, October 11, 2017, Wood, D.).

Home care providers. The Illinois Home Services Program pays personal home health care assistants to attend to the daily needs of elderly and disabled persons in the state. Under Illinois law, the personal assistants are considered public employees only for the purposes of collective bargaining with the state. Since 2003, SEIU has served as the exclusive representative. The union is obligated to represent all personal assistants—both members of the union and nonmembers alike. Under the terms of its collective bargaining agreement with the state, the union was entitled to collect “fair-share fees” from workers who chose not to join the union in order to help cover the cost of representation.

Nonmembers objected to the fair-share fee arrangement, and filed this suit contending that the involuntary deduction and collection of those fees violated their First Amendment rights. The district court dismissed their claim and the Seventh Circuit affirmed. Ultimately, the Supreme Court agreed with the health care assistants and reversed in Harris v. Quinn. The matter was remanded back to the district court.

Once back in the district court, the home health care assistants sought certification of a class of all non-union member assistants from whom fair-share fees were collected from April 2008 until June 30, 2014, when the state stopped the fair-share fee deductions. The district court denied certification of the class for a number of reasons: the proposed class definition was overly broad because a substantial number of class members did not object to the fee and could not have suffered an injury; individual questions regarding damages predominated over common ones; the class faced serious manageability issues; and a class action was not a superior method for resolving the issue. This appeal followed.

First Amendment injury. On appeal, the health care assistants primarily relied on their argument that the district court’s refusal to certify rested on an error in law: specifically the proposition that deducting the fair-share fees could have caused a First Amendment injury to a worker only if the individual subjectively opposed the union or the fee at the time it was paid.

The Seventh Circuit observed that the focus of the Supreme Court’s ruling in Harris was exclusively on compelled participation. Nothing in that decision said that people cannot voluntarily join a union, or voluntarily pay a fair-share fee. Thus, the appeals court had no way of knowing whether or how many of the class members shared the named plaintiffs’ opposition to the collection of fair-share fees and to collective bargaining representation. In fact, the district court highlighted union evidence that many would-be class members had submitted affidavits that they did not object to the fair-share fees and would have consented if given the chance. It concluded that there were likely a significant number of health care assistants in the proposed class whose First Amendment rights had not been injured by the fee collection.

Here, the appeals court declined to accept the objectors’ characterization of the injury as the denial of the choice to pay or not pay, and that it is enough that money was taken without their affirmative consent and used for collective bargaining purposes. It noted that objectors presumed that silence was equivalent to non-consent, but that the argument that these funds were taken without consent stood on shaky ground. A course of conduct or rule that impinges upon the exercise of a legal right does not always injure the people it affects, certainly not if they consent or voluntarily accept the rule.

Moreover, the appeals court rejected the objectors’ contention that if some measure of subjective opposition is required for a First Amendment injury, then the choice not to join the union was sufficient to demonstrate that opposition and thus show a First Amendment injury. Rather, it concluded that this case has always been about the decision whether to support collective bargaining representation and pay the fair-share fee, and the health care assistants were never asked to express a preference on that point.

Rule 23 requirements. With respect to the requirements of Rule 23 the appeals court found that the district court did not abuse its discretion in finding that there were serious intra-class conflicts of interest in the objectors’ proposed class, and that the proposed representatives could not fairly and adequately protect prospective members. The appeals court rejected the objectors’ proposal to certify the class and allow members with competing interests to opt out, finding it no substitute for a properly certified class. Additionally, the district court correctly concluded that common questions did not predominate so as to make a class action superior to individual actions. Therefore, the judgment of the district court was affirmed.

Concurrence. Judge Manion had trouble with the district court’s determination that many of the health care assistants supported the union and didn’t oppose the “fair-share” fees, and so did not accrue a compensable First Amendment injury. However, he pointed out that they were not first given a choice of whether or not to pay the fee before the union seized their money. Manion concluded that every proposed class member that had fees seized without his or her consent was enough to establish a compensable injury. Nevertheless, he concurred in the court’s judgment. Although he argued that the district court’s mistakes led to erroneous conclusions that the proposed class failed to satisfy two of the four prerequisites for certification under Rule 23(a)(3), the lower court did not abuse its discretion in finding under Rule 23(b)(3) that issues common to class members did not predominate over individual issues, and a class action would not be superior to individual actions.

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