Don’t believe the hysteria: There are other ways for public workers to get benefits

By Steven Greenhut
August 17, 2018

Sacramento

The media coverage of the U.S. Supreme Court’s recent Janus decision, striking down all mandatory union dues-collections as an infringement of the First Amendment, has been met with weeping and gnashing of teeth from union leaders. In their view, the conservative majority’s ruling is an assault on the ability of union members to negotiate various job protections and benefits. Yet critics of the decision miss a couple of fundamental points.

For starters, public employees of all types and categories already have far better job protections and compensation packages than people working in the private sector. Virtually all public employees receive defined-benefit retirement plans that guarantee pensions based on a formula, whereas such pensions have almost entirely been replaced by 401/k plans in the private sector. For instance, typical public-safety employees in California receive 90 percent or more of their final years’ pay available at age 50. Such benefits don’t exist in private industry.

In other words, reducing unions’ ability to negotiate these compensation packages – along with their success at securing other premium benefits and protections – at most will push such packages closer to the mean. That’s good news for taxpayers – and something that won’t cause much harm to public employees given the level of excess that has flourished in the government sector.

Furthermore, public employees also enjoy government civil-service protections. Those laws make it difficult to discipline or fire government workers, and nothing in the Janus decision does anything to erode those rules. But here’s something that’s even more widely overlooked: Many private associations and trade groups will offer various insurance coverages and benefit plans that can fill in the gap for those public employees who choose not to be members of unions. Just because people are no longer forced to pay large dues payments to their specified collective-bargaining units does not mean that they will no longer have access to such benefits.

It remains to be seen what options will emerge, given that it will take months or even years for the details of the post-Janus world to emerge. But here’s a good example of what we can expect. The Association of American Educators announced an expansion of benefits that it is offering to educators who choose to be members of that professional association. This is from AAE’s statement: “Throughout their career, educators can experience workplace issues that threaten their job as well as their professional reputation. Along with liability insurance and protection against lawsuits, AAE professional membership includes employment rights coverage for members experiencing termination, demotion, involuntary transfer, suspension, or other disciplinary actions.”

The group’s legal support program costs $198 annually for members. It’s just one program from one group, but it illustrates how a free-market situation will fill help fill any benefit gaps for government workers who opt out of union membership. Such programs also will force unions to be more cost effective and do a better job trying to lure teachers and other government employees to pay dues and stay in the union. Before Janus, unions would simply have the government mandatorily deduct dues from the workers’ paycheck. Because of a 1977 U.S. Supreme Court decision (Abood v. Detroit Board of Education), those workers could go through a convoluted process of deducting the portion of their dues that are for direct political spending – but unions controlled the process and determined (in their favor, of course) how much spending could actually be returned to these employees. They also made it cumbersome for employees to opt out of union membership, for some fairly obvious reasons.

In such a monopoly situation, there’s little incentive for unions to spend their money carefully or to, say, keep a lid on the astounding salaries often paid to their leaders. There was no incentive to tailor the programs to meet the needs of customers because those “customers” were forced to pay their annual dues anyway. Following Janus, workers have a choice to withhold all of their dues – for political and collective-bargaining purposes – so the unions will have renewed pressure to spend their funds more wisely and to offer programs that people want enough that they are voluntarily willing to pay for them.

As I’ve written previously, public-sector unions have taken a two-pronged approach in preparation for the expected Janus ruling. The first and highly disturbing prong has been to lobby legislatures to pass laws that give unions the ability to hobble efforts by employees to cut themselves loose from their unions. For instance, one recent California law gives unions on-the-job access to employees to make a pitch for union membership. Slate magazine has also reported that “States can replace their fair-share fee laws with provisions that require or allow public sector employers to subsidize unions directly.”

That’s something to be concerned about, but the California Policy Center’s Ed Ring has noted that such direct subsidies might be a hard sell for voters even in liberal states such as California. But he summarized some of the harder-to-stop approaches that already are moving forward: “Examples including denying right-to-work and pro-free-speech groups access to public employees, forbidding employers to discuss pros and cons of unionization, mandatory new employee ‘orientations’ with union membership commitments filled with fine print and buried in multiple documents requiring a signature, handing dispute resolutions over to the union-packed PERB instead of the courts, broadening the base of employees eligible to join the unions.”

Some unions have been sending out membership renewals with “trap language” that essentially traps workers into giving up some of their Janus rights. But some union officials have taken that second prong: focusing on ways that they can better listen to workers and come up with programs and policies that encourage – rather than force – them to join.

This latter approach should be applauded by those of us who believe in the fundamental wisdom of Janus. No one should be forced to subsidize organizations they don’t support, but it’s fair game if those organizations take a market approach and start winning over members with better services. Toward that end, competition from private professional associations and union alternatives could force unions to step up their game. The big question is whether this healthy situation will be allowed to develop before union-friendly legislators find a new way to rig the game and undermine the clear intent of the U.S. Supreme Court’s decision.

Steven Greenhut is contributing editor for the California Policy Center. He is Western region director for the R Street Institute. Write to him at sgreenhut@rstreet.org.

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