UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA LOCAL 3047, et al. v. HARDIN COUNTY, KENTUCKY, et al.
No. 16-5246
United States Court of Appeals for the Sixth Circuit
November 18, 2016
16a0275p.06
RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Sixth Circuit I.O.P. 32.1(b). Argued: October 18, 2016. Decided and Filed: November 18, 2016. Before: BOGGS, SUHRHEINRICH, and McKEAGUE, Circuit Judges.
ARGUED: John T. Lovett, FROST BROWN TODD LLC, Louisville, Kentucky, for Appellants. James B. Coppess, AFL-CIO LEGAL DEPARTMENT, Washington, D.C., for Appellees. ON BRIEF: John T. Lovett, Kyle D. Johnson, FROST BROWN TODD LLC, Louisville, Kentucky, for Appellants. James B. Coppess, Craig Becker, AFL-CIO LEGAL DEPARTMENT, Washington, D.C., Irwin H. Cutler, Jr., Louisville, Kentucky, Robert M. Colone, Louisville, Kentucky, for Appellees. Mitchel T. Denham, Matt James, OFFICE OF THE KENTUCKY ATTORNEY GENERAL, Frankfort, Kentucky, Kevin J. Hobson, NATIONAL LABOR RELATIONS BOARD, Washington, D.C., for Amici Curiae.
McKEAGUE, Circuit Judge. This case presents a challenge by numerous collective bargaining organizations to a Kentucky county‘s so-called “right to work” ordinance. The Unions contend the ordinance is unenforceable because it is preempted by the National Labor Relations Act.
The district cоurt awarded summary judgment to the unions, holding that the ordinance is preempted. The court recognized that the NLRA expressly excepts from preemption such right-to-work protections under “State law,” but held that the law of a State‘s political subdivision is not “State law.” For the reasons that follow, we affirm in part and reverse in part.
I. BACKGROUND
The National Labor Relations Act (“NLRA“) is undoubtedly intended to create a national, uniform body of labor law and policy, but the language used to carry out this purpose is not definite. Further, although the NLRA has been a fixture of the American legal landscape for more than 80 years, there is little authoritative case law on the instant question regarding the Act‘s preemptive scope. In the absence оf any controlling authority, the district court relied primarily on a canon of construction. The court described the context for its decision clearly and succinctly as follows:
The National Labor Relations Act is a broad federal law that regulates the relationships between employers and unions. The NLRA permits agreements between employers and unions that require employees to join or pay dues to the union, known as union-security agreements. But the NLRA also permits “State or Territorial” laws that prohibit such agreements, commonly referred to as right-to-work laws. The primary question presented by this lawsuit is whether a right-to-work law may be enacted solely by a state or territorial government, or whether a local government—in this case a county—may pass a law prohibiting union-security agreements. Because the Court finds that local regulation of union-security agreements is preempted by the NLRA, the right-to-work ordinance at issue here is invalid.
no person covered by the National Labor Relations Act shall be required as a condition of employment or continuation of employment:
. . .
(B) to become or remain a member of a labor organization;
(C) to pay any dues, fees, assessments, or other charges of any kind or amount to a labor organization; [or]
(D) to pay to any charity or other third party, in lieu of such payments, any amount equivalent to or a pro-rata portion of dues, fees, assessments, or other charges regularly required of members of a labor organization[.]
Section 6 of the ordinance declares any such agreements “unlawful, null and void, and of no legal effect.”
The plaintiff labor organizations assert that Sections 4 and 6 of the ordinance violate the Supremacy Clause of the Constitution. According to the plaintiffs, the NLRA preempts right-to-work laws not specifically authorized in
In 1935, Congress enacted the National Labor Relations Act, which established federal labor relations standards and the National Labor Relations Board. See
Nothing in this Act shall be construed as authorizing the execution or application of agreements requiring membership in a labor organization as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territorial law.
by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization: Provided, That nothing in this Act, or in any other statute of the United States, shall preclude an employer from making an agreement with a labor organization . . . to require as a condition of employment membership therein on or after the thirtieth day following the beginning of such employment or the effective date of such agreement, whichever is the later[.]
United Automobile, Aerospace and Agricultural Implement Workers of America v. Hardin Cty., Ky., 160 F. Supp. 3d 1004, 1006–08 (W.D. Ky. 2016) (headings, footnotes, and record citations omitted).
The district court went on to conclude that Hardin County‘s Ordinance 300 is not “State law” under
Hardin County contends on appeal that because it is a subdivision of state government, its laws do come within the
II. ANALYSIS
A. Meaning and Significance of § 14(b)
(1) Statutory Construction
All of the County‘s claims of error present questions of law, which we review de novo. Ohio Democratic Party v. Husted, 834 F.3d 620, 628 (6th Cir. 2016). There are no disputed issues of fact and, on de novo review, the district court‘s legal conclusions are entitled to no deference.
The NLRA was enacted to “obtain ‘uniform application’ of its substantive rules and to avoid the ‘diversities and conflicts likely to result from a variety of local procedures and attitudes toward labor controversies.‘” NLRB v. Nash-Finch Co., 404 U.S. 138, 144 (1971) (quoting Garner v. Teamsters, Chauffeurs and Helpers Local Union, 346 U.S. 485, 490 (1953)). “The federal regulatory scheme (1) protects some activities, though not violence, (2) prohibits some practices, and (3) leaves others to be controlled by the free play of economic forcеs.” Nash-Finch, 404 U.S. at 144 (citation omitted). “For a state to impinge on the area of labor combat designed to be free is quite as much an obstruction of federal policy as if the state were to declare
Yet, despite the breadth of Congress‘s purpose to create a national, uniform body of labor law and policy, the boundaries of federal preemption “are not susceptible of delimitation by fixed metes and bounds.” San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 240 (1959). “The extent to which the variegated laws of the several States are displaced by a single, uniform, national rule has been a matter of frequent and recurring concern . . . ‘of a Delphic nature, to be translated into conсreteness by the process of litigating elucidation.‘” Id. at 241 (quoting Int‘l Ass‘n of Machinists v. Gonzales, 356 U.S. 617, 619 (1958)).
Indeed, more than fifty years after the Garmon Court recognized the role of “litigating elucidation,” the extent of NLRA preemption of laws regulating union-security agreements has not been fully concretized. But even assuming the NLRA has preemptive reach in this area, Hardin County contends the right-to-work protection afforded by § 4 of Ordinance 300 is clearly excepted from preemption by
Nothing in this Act shall be construed as authorizing the execution or application of agreements requiring membership in a labor organization as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territоrial law.
The district court relied primarily on a rule of statutory construction: “identical words and phrases within the same statute should normally be given the same meaning.” Powerex Corp. v. Reliant Energy Servs., Inc., 551 U.S. 224, 232 (2007). Applying this rule, the court explained:
[I]t makes little sense to read “State or Territorial law” as encompassing local law in light of the statute‘s previous reference to “any State or Territory“—if “State or Territorial law” includes the laws of political subdivisions, then the statute must be read “in any State or Territory [or politiсal subdivision thereof]” to avoid assigning two different meanings to “State” in the same sentence. This is not a logical reading . . . .
United Automobile, 160 F. Supp. 3d at 1008.
Yet, it absolutely is a logical reading. In the district court‘s formulation, if, as the County posits, “State law,” as used in
Moreover, the County‘s position is even stronger when we turn the formulation around. That is, if the first reference to “State” in
Insofar as the district court‘s construction of
(a) Wisconsin Public Intervenor v. Mortier
Before adopting the Powerex maxim as the basis for its construction of
The principle is well settled that local governmental units are created as convenient agencies for exercising such of thе governmental powers of the State as may be entrusted to them . . . in its absolute discretion. The exclusion of political subdivisions cannot be inferred from the express authorization to the “States” because political subdivisions are components of the very entity the statute empowers. Indeed, the more plausible reading of FIFRA‘s authorization to the States leaves the allocation of regulatory authority to the absolute discretion of the States themselves, including the option of leaving local regulation of pesticides in the hands of local authorities.
Id. at 607–08 (internal quotation marks, alterations and citations omitted).
Here, as in Mortier, we consider federal statutory language that expressly allows specific regulation by the States, but is silent as to regulation by political subdivisions of the States. Here, as in Mortier, we consider a “comprehensive regulatory statute” that does not explicitly preempt local regulatory authority. Id. at 601. Here, as in Mortier, we consider the meaning of a statutory provision where “no other textual basis for pre-emption exists.” Id. at 608. Here, as in Mortier, we consider Congress‘s use of the term “State,” which “is not self-limiting since political subdivisions are merely subordinate components of the whole.” Id. at 612. And here,
Mortier thus represents strong support for Hardin County‘s argument that, as a political subdivision of the Commonwealth of Kentucky, it enjoys the same freedom that Kentucky does under
(b) City of Columbus v. Ours Garage and Wrecker Service
The second case distinguished by the district court is City of Columbus v. Ours Garage and Wrecker Service, Inc., 536 U.S. 424 (2002). In Ours Garage, the Court again addressed whether a federal law, the Interstate Commerce Act (“ICA“), that expressly excepted state safety regulatory authority from preemption, also excepted such regulations of political subdivisions of the State. Disproving the district court‘s notion that the Mortier ruling is limited to its facts or the particular language of FIFRA, the Court closely followed the Mortier analysis in holding:
Absent a clear statement to the contrary, Congress’ reference to the “regulatory authority of a State” should be read to preserve, not preempt, the traditional prerogative of the States to delegate their authority to their constituent parts.
Ours Garage, 536 U.S. at 429 (emphasis added). How a State chooses to exercise the governmental powers entrusted to it, the Court observed, is in its “absolute discretion.” Id. at 437 (quoting Mortier, 501 U.S. at 608). The Court reiterated that mere silence is insufficient to establish a clear and manifest purpose to preempt local authority. See also Nixon v. Missouri Municipal League, 541 U.S. 125, 140 (2004) (noting “that federal legislation threatening to
This was the Ours Garage holding, notwithstanding that the ICA expressly preempted various types of regulation by a State and its political subdivisions, but excepted safety regulations by a State without mentioning political subdivisions; and notwithstanding that in several other parallel provisions excepting other types of state regulatory authority, the ICA also expressly excepted such authority of the State‘s political subdivisions. This inconsistency made for a strong dissent by two justices, who would have presumed the disparate omission of the term “political subdivisions” in the subject provision signaled Congress‘s purpose not to excеpt local regulation from preemption. Yet, in reversing the Sixth Circuit, seven justices abided by the rule that mere silence is insufficient to justify such a presumption of congressional intent.
Ours Garage thus represents even stronger authority for Hardin County‘s position than Mortier. The NLRA does not expressly preempt state or local authority to prohibit union-security agreements—although
(c) CSX Transportation v. City of Plymouth
As amicus curiae, the Commonwealth of Kentucky cites a Sixth Circuit ruling that seems to run counter to Mortier and Ours Garage. In CSX Transp., Inc. v. City of Plymouth, 86 F.3d 626 (6th Cir. 1996), the court considered an express exception to express preemption under the Federal Railway Safety Act (“FRSA“). Because the exception applied only to safety regulations of a “State,” thе exception was summarily held not to encompass Plymouth‘s municipal regulation: “As Plymouth is not a ‘State,’ the challenged Plymouth ordinance is not within the FRSA‘s preemption clause exceptions.” Id. at 628. In so ruling, the court cited a line of lower court decisions so construing the FRSA exception provision, but did not cite any Supreme Court precedent, including Mortier.
The CSX Transportation ruling predated Ours Garage. It was followed in a subsequent Sixth Circuit decision, Petrey v. City of Toledo, 246 F.3d 548, 562 (6th Cir. 2001), but Petrey was essentially overruled by Ours Garage. See Mason and Dixon Lines Inc. v. Steudle, 683 F.3d 289, 295 (6th Cir. 2012) (recognizing abrogation). So, what is the remaining significance of CSX Transportation? We acknowledge that the preemptive effect of each federal regulatory scheme (and exception thereto) is defined by its own body of case law, as Congress‘s intent is divined with reference to the subject statutory language, rules of construction, and legislative history. It follows that CSX Transportation‘s specific holding that the subject FRSA preemption exception did not encompass local regulations carries little weight in relation to our construction of
Although preemption authority does not have to be explicit, see Gregory v. Ashcroft, 501 U.S. 452, 467 (1991), the authority to preempt such allocations must bе delegated by way of a clear statement. In applying the clear statement rule, the federal statute should be treated with great skepticism, and read in a way that preserves a State‘s chosen disposition of its own power, in the absence of the plain statement that Gregory requires.
Id. at 613 (internal quotation omitted). Finding no such clear statement by Congress in the Telecommunications Act, the court held that “a state‘s allocation of powers between itself and its subdivisions” was not preempted. Id. It follows then, pursuant to current Sixth Circuit law, that because Congress, in
(d) Kentucky State AFL-CIO v. Puckett and New Mexico Fed‘n of Labor v. City of Clovis
The briefing also includes citation to two decisions that specifically held that
Both of these rulings predated the Supreme Court‘s Mortier and Ours Garage decisions and did not grapple with the Court‘s fundamental rationale in those cases. Again, “[a]bsent a
3. Conclusion re § 14(b)
In sum, contrary to the district court‘s ruling, the Supreme Court‘s rulings in Mortier and Ours Garage and the Sixth Circuit‘s ruling in State of Tennessee v. FCC represent strong support for Hardin County‘s position that
B. Field Preemption
Yet the Unions contend that this construction would frustrate Congress‘s intent to preempt the field of industrial relations regulation. Because the district court concluded that
The ways in which federal law may pre-empt state law are well establishеd and in the first instance turn on congressional intent. Congress’ intent to supplant state authority in a particular field may be expressed in the terms of the statute. Absent explicit pre-emptive language, Congress’ intent to supersede state law in a given
area may nonetheless be implicit if a scheme of federal regulation is so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it, if the Act of Congress . . . touches a field in which the federal interest is so dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject, or if the goals sought to be obtained and the obligations imposed reveal a purpose to рreclude state authority. When considering pre-emption, we start with the assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress. Even when Congress has not chosen to occupy a particular field, pre-emption may occur to the extent that state and federal law actually conflict. Such a conflict arises when compliance with both federal and state regulations is a physical impossibility, or when a state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.
It is, finally, axiomatic that for the purposes of the Supremacy Clause, the constitutionality of local ordinances is analyzed in the same way as that of statewide laws.
Mortier, 501 U.S. at 604–05 (internal quotation marks, alterations and citations omitted).
There are thus three types of preemption, all of which turn on Congress‘s intent. Federal law may be deemed to preempt state and local law (1) by explicit language; (2) implicitly, by virtue of pervasive federal regulation of a particular field; or (3) implicitly, by virtue of an actual conflict between federal and state or local regulations. Only the second of these three ways is at issue here. That is, there is no contention that local right-to-work laws like Hardin County‘s are expressly preempted by the NLRA. Nor is there an argument that the ordinance is preempted because an employer‘s compliance with it—by refraining from requiring an employee to join a union or pay union dues and fees—would result in violation of a federal regulation. Rather, the challengers of Ordinance 300 contend that Congress has manifested its intent to preempt implicitly by its pervasive regulation of industrial relations. Specifically, they rely on Garmon field preemption, as defined in San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236 (1959).
In relevant part, Garmon provides:
When it is clear or may fairly be assumed that the activities which a State purports to regulate are protected by
§ 7 of the National Labor Relations Act , or constitute an unfair labor practice under§ 8 , due regard for the federal enactment requires that state jurisdiction must yield. To leave the States free to regulate conduct soplainly within the central aim of federal regulation involves too great a danger of conflict bеtween power asserted by Congress and requirements imposed by state law. Nor has it mattered whether the States have acted through laws of broad general application rather than laws specifically directed towards the governance of industrial relations. Regardless of the mode adopted, to allow the States to control conduct which is the subject of national regulation would create potential frustration of national purposes. * * * *
When an activity is arguably subject to
§ 7 or§ 8 of the Act , the States as well as the federal courts must defer to the exclusive competence of the National Labor Relations Board if the danger of state interference with national policy is to be averted.
Id. at 244, 245. Garmon preemption “is intended to preclude state interference . . . with enforcement of the ‘integrated scheme of regulation’ established by the NLRA.” Chamber of Commerce of U.S. v. Brown, 554 U.S. 60, 65 (2008) (quoting Golden State Transit Corp. v. Los Angeles, 475 U.S. 608, 613 (1986)). ”Garmon pre-emption forbids States to ‘regulate activity that the NLRA protects, prohibits, or arguably protects or prohibits.‘” Id. (quoting Wisconsin Dep‘t of Industry v. Gould Inc., 475 U.S. 282, 286 (1986)).
Because Congress has sought to regulate industrial relations comprehensively, the States are implicitly denied freedom to regulate any activity that is even arguably subject to
As such, under Garmon preemption, the County‘s ordinance could be deemed implicitly preempted—but for the
This conclusion is confirmed by the Supreme Court‘s decision in Retail Clerks Int‘l Ass‘n v. Schermerhorn, 375 U.S. 96 (1963). In Schermerhorn, the Court held that
[Section] 14(b) gives the States powеr to outlaw even a union-security agreement that passes muster by federal standards. Where Congress gives state policy that degree of overriding authority, we are reluctant to conclude that it is nonetheless enforceable by the federal agency in Washington.
This result on its face may seem to be at war with San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, decided in 1959, and holding that where action is “arguably subject to
§ 7 or§ 8 of the Act , the States as well as the federal courts must defer to the exclusive competence of the National Labor Relations Board.” 359 U.S. at 245.* * * *
Garmon, however, does not state a constitutional principle; it merely rationalizes the problems of coexistence between federal and state regulatory schemes in the field of labor relations; and it did not present the problems posed by
§ 14(b) , viz., whether the Congress had precluded state enforcement of selеct state laws adopted pursuant to its authority. The purpose of Congress is the ultimate touchstone.* * * *
The Court in Algoma Plywood & Veneer Co. v. Wisconsin Emp. Relations Board, 336 U.S. 301, 314 [(1949)] stated that ”
§ 14(b) was included to forestall the inference that federal policy was to be exclusive” on this matter of union-security agreements.* * * *
Congress, in other words, chose to abandon any search for uniformity in dealing with the problems of state laws barring the execution and application of agreements authorized by
§ 14(b) and decided to suffer a medley of attitudes and philosophies on the subject.As a result of
§ 14(b) , there will arise a wide variety of situations presenting problems of the accommodation of state and federal jurisdiction in the union-security field.
Schermerhorn, 375 U.S. at 103–05.
Accordingly, per the teaching of Mortier and Ours Garage, the dispositive question is whether Congress‘s use of “State” in
C. Hiring-Hall Agreements and Dues-Checkoff Provisions
Ordinance 300 also includes two other provisions related to its right-to-work guarantee that are challenged by the plaintiff Unions. The ordinance prohibits employers and unions from entering into so-called “hiring hall” agreements, under which prospective employees arе required “to be recommended, approved, referred, or cleared by or through a labor organization.” R. 5-1, Ordinance 300, § 4(E), Page ID 96. The ordinance also prohibits so-called “dues checkoff” provisions, whereby employers deduct “union dues, fees and assessments or other charges” from
In SeaPAK v. Industrial, Technical & Professional Employees, 300 F. Supp. 1197 (S.D. Ga. 1969), the court acknowledged that the obligation to pay dues to a union is the practical equivalent of requiring union membership, citing NLRB v. General Motors Corp., 373 U.S. 734, 743 (1963). Yet, the court held that a state law regulating such a dues-payment arrangement did not come within the
While Hardin County maintains that its ordinance regulation of dues checkoff provisions does not actually conflict with that of the LMRA, the fact remains that the activity is subject to regulation under the LMRA. Allowing dual regulation under federal and state law would undermine Congress‘s purposes and contravene field preemption. The analysis set forth in SeaPAK is not conclusive, but it bears the Supreme Court‘s imprimatur and its authority remains essentially unchallenged by any conflicting case law authority.
The same result obtains in relation to the County‘s regulation of hiring-hall agreements. In Simms v. Local 1752, Int‘l Longshoremen Ass‘n, 838 F.3d 613, 619–20 (5th Cir. 2016), the Fifth Circuit recently held that Mississippi‘s right-to-work law‘s prohibition of compulsory
Perceiving no sound reason to depart from the above authorities, we find no error in the district court‘s decision to follow them. The district court properly held that the Ordinance 300 provisions dealing with hiring-hall agreements and dues-checkoff requirements are preempted and unenforceable.
III. CONCLUSION
Accordingly, the district court‘s judgment must be affirmed in part and reversed in part. Because the Hardin County ordinance‘s right-to-work protection is expressly excepted from preemption by Congress in