The Supreme Court in Janus v. American Federation of State, County, and Municipal Employees, Council 31 upended public sector labor law by finding a novel First Amendment right of public employees to refuse to pay union fees and declaring unconstitutional scores of laws and thousands of labor contracts. This Article assesses the constraints on public sector labor law post-Janus, examines the variety of legislative responses, and proposes a path forward.
Janus makes it difficult to address the collective action problem facing all large groups. Although it is in the interest of every member of a group to engage in collective action to provide common goods, it is also in each individual’s interest to let others incur the costs of doing so. The Janus Court misstated the nature of the collective action problem when it said the problem was free-riding on union-negotiated benefits. The problem is that, without some way to require all who benefit to share the costs, unions will not negotiate effectively for the benefits in the first place, so there will be no common goods to free ride on.
Many proposals for ameliorating the collective action problem exacerbated by Janus continue unions’ financial solvency in the short-term but sacrifice unions’ fundamental nature as membership organizations governed by and for workers. Some adopt a form of members-only representation, thus abandoning the principles of majority and exclusive representation. Others have government employers subsidize the cost of union representation. And yet others treat union fees like health insurance: subject to an annual open-enrollment period. But four major public sector unions have condemned many of these approaches, even as legislatures have considered or enacted them. Close analysis of the unintended effects of these approaches to the collective action problem shows why they are problematic.
Returning to the economic theory of groups and public goods, the Article assesses legislation that seeks to give public employee unions some of the attributes of small groups, in which a mix of social norms and individual benefits provide the incentives for individuals to incur the costs of providing public goods. The Article concludes by explaining why the options we propose could survive the inevitable post-Janus legal challenges and enable unions to be majoritarian democratic institutions that are accountable to those whom they represent.