966 F.3d 661
7th Cir.2020Background
- Maysteel Industries employees were represented by the Machinists under a 2012–2015 CBA that included a union‑security clause and payroll dues/fee check‑off.
- Parties negotiated a successor 2015–2018 CBA: negotiators completed terms Feb 27, 2015; union ratified Feb 28, 2015; the parties implemented the agreement in early March; the written agreement was signed March 18, 2015.
- Wisconsin’s Act 1 (effective March 11, 2015) barred enforcement of union‑security provisions in CBAs renewed, modified, or extended on or after that date; plaintiffs sued in state court claiming Act 1 invalidated the new union‑security clause and that dues deductions violated the state wage statute.
- Defendants removed to federal court, arguing the case raised federal labor questions (§301/contract formation); the magistrate judge denied remand and granted summary judgment to defendants; plaintiffs appealed.
- The Seventh Circuit held federal jurisdiction appropriate under the embedded federal‑question (Grable) doctrine and ruled the 2015–2018 CBA became binding on ratification (Feb 28), so Act 1 did not apply and the union‑security clause remained valid; wage claims were either preempted or within NLRB/exclusive contractual remedies.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jurisdiction (removal) | Claims are purely state law under Act 1; remand required | Federal issue embedded (contract formation/§301) or completely preempted by §301 | Removal proper: federal jurisdiction under embedded federal‑question (Grable/Gunn) |
| Timing of CBA formation (does Act 1 apply?) | CBA not formed until written execution (Mar 18); execution post‑dates Act 1 so Act 1 invalidates the clause | CBA formed by negotiators’ agreement + union ratification (Feb 28) before Act 1 | CBA formed on ratification (Feb 28); Act 1 did not apply; union‑security clause valid |
| Wage‑payment/unauthorized deduction claim | Dues/fees were withheld without authorization in violation of state wage statute | Claim depends on validity/terms of the CBA and is preempted or within NLRB/contract remedies | Claim arises under/depends on CBA or is Garmon‑preempted; dismissal affirmed |
| Certification to Wisconsin Supreme Court | State law questions (Act 1 applicability; wage statute) warrant certification | Federal law controls contract‑formation question; certification unnecessary | Denied: state law does not control the decisive issues here |
Key Cases Cited
- Grable & Sons Metal Prods., Inc. v. Darue Eng’g & Mfg., 545 U.S. 308 (establishes embedded federal‑question test)
- Gunn v. Minton, 568 U.S. 251 (applies Grable four‑part test for substantial federal issue)
- Caterpillar Inc. v. Williams, 482 U.S. 386 (well‑pleaded complaint rule; §301 complete preemption context)
- Avco Corp. v. Aero Lodge No. 735, 390 U.S. 557 (recognition of §301 complete preemption)
- Allis‑Chalmers Corp. v. Lueck, 471 U.S. 202 (federal common law governs §301 contract disputes)
- Retail Clerks Int’l Ass’n v. Schermerhorn, 375 U.S. 96 (states may enforce right‑to‑work laws under §14(b))
- Lucas Flour Co. v. Local 174, Teamsters, 369 U.S. 95 (need for uniform federal rules in labor contract administration)
- Sweeney v. Pence, 767 F.3d 654 (7th Cir.) (treats §14(b) scope re: union‑security clauses)
- Mohr v. Metro East Mfg. Co., 711 F.2d 69 (uniform federal rules govern formation timing of labor contracts)
- Mack Trucks, Inc. v. United Auto Workers, 856 F.2d 579 (ratification can be the final act making a CBA binding)