Labor speech, corporate speech, and political speech: A response to professor Sachs

Columbia Law Review

Volumn 112, Issue 8, 2012, Pages 206-218

  Bodie, Matthew T ^a  

^a SAINT LOUIS UNIVERSITY   (United States)

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EID: 84867585787     PISSN: 00101958     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Note

References (124)

1. Robert J. Shapiro & Douglas Dowson, Corporate Political Spending: Why the Critics Are Wrong, 15 Legal Pol'y Rep. 1, 3 (2012), available at http://www.manhattaninstitute.org/pdf/lpr_15.pdf (on file with the Columbia Law Review).
2. Editorial, Political Spending Pays, Wall St. J. (June 18, 2012), http://online.wsj.com/article/SB10001424052702303734204577468443488066430.html (on filewith the Columbia Law Review) (discussing Manhattan Institute study).
3. 130 S. Ct. 876 (2010).
4. For example, the Bush Administration's Energy Task Force met secretly with 'oil and gas companies and . . . trade groups-many of them big contributors to the Bush campaign and the Republican Party.'
5. Michael Abramowitz & Steven Mufson, Papers Detail Industry's Role in Cheney's Energy Report, Wash. Post (July 18, 2007), http://www.washingtonpost.com/wpdyn/content/article/2007/07/17/AR2007071701987.html (on file with the Columbia Law Review).
6. Chris Lehmann, Andy Stern: The New Face of Labor, Washingtonian, March 2010, at 55, 55, available at http://www.washingtonian.com/articles/people/andy-stern-the-new-face-oflabor/(on file with the Columbia Law Review).
7. The union spent Dolar85 million on political campaigns as a whole in 2008.
8. Kris Maher, SEIU Campaign Spending Pays Political Dividends, Wall St. J. (May 16, 2009), http://online.wsj.com/article/SB124243785248026055.html (on file with the Columbia Law Review).
9. Maher, supra note 4.
10. 132 S. Ct. 2277, 2293 (2012).
11. Laura K. Chapin, Supreme Court Ruling Empowers Corporations More than Labor Unions, Thomas Jefferson Street Blog, USNews.com (Jan. 22, 2010), http://www.usnews.com/opinion/blogs/laura-chapin/2010/01/22/supreme-court-ruling-empowerscorporations-more-than-labor-unions
12. On file with the Columbia Law Review) ('According to the Center for Responsive Politics, business and corporate interests accounted 70.8 percent of the total U.S. political contributions in 2007-2008, while only 2.7 percent came from labor.'). There is some debate about the actual extent of union political contributions.
13. Tom McGinty & Brody Mullins, Political Spending by Unions Far Exceeds Direct Donations, Wall St. J. (July 10, 2012), http://online.wsj.com/article/SB10001424052702304782404577488584031850026.html
14. On file with the Columbia Law Review) (arguing that actual union donations, including donated work hours, are significantly larger than direct expenditures usually tracked). But even at the highest end of the labor spending range, corporations still spend significantly more. See, e.g., id. (noting that in 2008 corporate PACs donated Dolar2 billion, while union PACs donated Dolar75 million).
15. Benjamin I. Sachs, Unions, Corporations, and Political Opt-Out Rights After Citizens United, 112 Colum. L. Rev. 800 (2012)[hereinafter Sachs, Unions].
16. Id. at 869.
17. Id. at 866 (suggesting that "resolving the asymmetry by extending opt-out rights to the corporate context is both the better, and the more likely, way forward").
18. For purposes of this piece, the terms 'dissidents' and 'nonmembers' refer to those employees who are represented by a union but have chosen not to be members. The term 'objecting nonmembers' will be used to cover those nonmembers who specifically object to paying union dues for the union's political activity.
19. Int'l Ass'n of Machinists v. Street, 367 U.S. 740, 770 (1961) (imposing opt-out requirements for use of union funds for political speech under Railway Labor Act); Abood v. Detroit Bd. of Educ., 431 U.S. 209, 232 (1977) (extending opt-out rights to public employees); Commc'ns Workers of Am. v. Beck, 487 U.S. 735, 745 (1988) (extending opt-out rights to workers under National Labor Relations Act).
20. Street, 367 U.S. at 768-769.
21. Id. at 760-764.
22. Abood, 431 U.S. at 235-236.
23. Beck, 487 U.S. at 761-763.
24. Sachs, Unions, supra note 8, at 818. As an example, the National Labor Relations Board issued thirty-nine opinions between 1996 and 2000 dealing with political opt-out rights.
25. Wilma B. Liebman & Peter J. Hurtgen, The Clinton Boards-A Partial Look from Within, 16 Lab. Law. 43, 72 (2000).
26. Knox v. Serv. Emps. Int'l Union Local 1000, 132 S. Ct. 2277, 2295-96 (2012).
27. The assessment was entitled "Emergency Temporary Assessment to Build a Political Fight-Back Fund." Id. at 2285-2286.
28. Id. at 2285.
29. Id.
30. Id. at 2296 (Sotomayor, J., concurring in the judgment) ('When a public-sector union imposes a special assessment intended to fund solely political lobbying efforts, the First Amendment requires that the union provide nonmembers an opportunity to opt out of the contribution of funds. I therefore concur in the Court's judgment.').
31. Id. at 2293, 2296 (majority opinion).
32. Id. at 2296 (Sotomayor, J., concurring in the judgment) (criticizing the new rule as beyond the scope of the questions presented and briefed); id. at 2306 (Breyer, J., dissenting) (agreeing with Justice Sotomayor's concurrence).
33. Id. at 2299 (Sotomayor, J., concurring in the judgment) (noting that "the majority strongly hints" of the rule's expansion).
34. Id. at 2290 (majority opinion).
35. Id.
36. Id. at 2295.
37. Id.
38. Sachs has a penchant for addressing asymmetries in labor law.
39. Benjamin I. Sachs, Enabling Employee Choice: A Structural Approach to the Rules of Union Organizing, 123 Harv. L. Rev. 655, 659 (2010).
40. Characterizing card check and speedy representation elections as "asymmetry-correcting altering rules".
41. Sachs, Unions, supra note 8, at 805.
42. The Supreme Court has used this reasoning: The critical distinction here is that no shareholder has been "compelled" to contribute anything. Apart from the fact, noted by the dissent, that compulsion by the State is wholly absent, the shareholder invests in a corporation of his own volition and is free to withdraw his investment at any time and for any reason. A more relevant analogy, therefore, is to the situation where an employee voluntarily joins a union, or an individual voluntarily joins an association, and later finds himself in disagreement with its stance on a political issue. First Nat'l Bank of Bos. v. Belotti, 435 U.S. 765, 794 n.34 (1978).
43. Sachs, Unions, supra note 8, at 807.
44. Id. at 832-844.
45. Id. at 838-843.
46. Id. at 833-838. Sachs estimates that ten percent of U.S. jobs are covered by union security agreements. Id. at 834-35.
47. Id. at 844.
48. Id. at 844-851.
49. Id. at 853.
50. Id. at 856.
51. Id. at 858 (citing Citizens United v. FEC, 130 S. Ct. 876, 905 (2010)).
52. Id. at 865. He notes: "Symmetry itself, that is, demands only that the rule be the same in the two contexts; it does not dictate what the rule should be." Id.
53. Id. at 866.
54. Id.
55. Id.
56. Id. at 864-865.
57. Id. at 866-869.
58. Benjamin I. Sachs, How Pensions Violate Free Speech, N.Y. Times, July 12, 2012, at A23, available at http://www.nytimes.com/2012/07/13/opinion/undercitizens-united-public-employees-are-compelled-to-pay-for-corporate-political-speech.html
59. On file with the Columbia Law Review.
60. Lucian A. Bebchuk & Robert J. Jackson, Jr., Corporate Political Speech: Who Decides?, 124 Harv. L. Rev. 83, 115-117 (2010)
61. Proposing supermajority approval requirement for corporate political spending.
62. Sachs, Unions, supra note 8, at 865 (conjuring potential coalition of labor, institutional investors, shareholder advocates, and campaign finance reformers).
63. In fact, most shareholders have provided no money at all to the corporation. The corporation only receives money upon the initial sale of the stock; after that, shareholders pay their money to other shareholders. Sachs does not address this limitation.
64. For an argument that consumers in certain circumstances are bound to the company through long-term lock-in, and thereby deserve participation rights in corporate governance.
65. David G. Yosifon, Consumer Lock-In and the Theory of the Firm, 35 Seattle U. L. Rev. 1429, 1430-1431 (2012).
66. The employee may, in fact, be required to express a message she does not want to express.
67. Lila Shapiro, Chick-fil-A Anti-Gay Controversy: Gay Employees Speak Out, Huffington Post (Aug. 1, 2012, 5:31 PM), http://www.huffingtonpost.com/2012/08/01/chick-fil-aanti-gay-controversy-employees-speak-out_n_1729968.html.
68. On file with the Columbia Law Review) (discussing reactions of gay and lesbian employees to the controversy). Compelled speech presents a stronger constitutional concern than compelled subsidization of speech, particularly when there is a high risk that the compelled speech will be attributed to the compelled speaker. See Sachs, Unions, supra note 8, at 856-858.
69. With one notable exception, courts have not protected private-sector employees when they suffer discharge or other discipline in the exercise of their own First Amendment rights. For the exception, see Novosel v. Nationwide Ins. Co., 721 F.2d 894, 903 (3d Cir. 1983) (overturning motion to dismiss employee's wrongful termination claim).
70. Lisa B. Bingham, Employee Free Speech in the Workplace: Using the First Amendment as Public Policy for Wrongful Discharge Actions, 55 Ohio St. L.J. 341, 348 (1994)
71. "The prevailing view is that the First Amendment cannot be the basis of a public policy exception in wrongful discharge claims in the absence of state action.".
72. David C. Yamada, Voices from the Cubicle: Protecting and Encouraging Private Employee Speech in the Post-Industrial Workplace, 19 Berkeley J. Emp. & Lab. L. 1, 22 (1998)
73. 'In arguing for protection of private employee speech under the public policy exception, advocates and commentators have turned to the First Amendment and its state counterparts as the requisite sources of public policy. This argument, however, has had little success in the courts.'.
74. Matthew T. Bodie, Information and the Market for Union Representation, 94 Va. L. Rev. 1, 49-51 (2008)
75. Hereinafter Bodie, Information (discussing "market for lemons" problem in context of shareholders and union members).
76. Matthew T. Bodie, Mandatory Disclosure in the Market for Union Representation, 5 Fla. Int'l U. L. Rev. 617, 618 (2010).
77. Using SEC's mandatory disclosure regime for corporate securities to argue for similar disclosure system in union representation context.
78. Sachs, Unions, supra note 8, at 856.
79. Bodie, Information, supra note 54, at 36-40.
80. Union members are themselves much closer to participants in a consumer-owner cooperative than shareholders. See id. at 42.
81. Shareholders enjoy limited liability as to the tort victims of the corporation. To the extent the victims fail to collect the full amount of their damages, society forces them to provide a subsidy to the corporation. Thanks to Sam Bagenstos for this point.
82. In fairness to Sachs, he takes pains to say that his Article is not endorsing the validity of the union opt-out rule. See Sachs, Unions, supra note 8, at 805 n.22 ('The Article leaves for another day an exploration of whether the union opt-out rule is justified on its own terms . . . .'); id. at 814 n.71 ('This Article . . . is not concerned with the validity of the union rule on its own terms . . . . To this extent, the Article takes the union rule as given . . . .').
83. However, at other points he asserts that adding opt-out to corporate shareholders would be superior to removing the opt-out for union actors. Id. at 866 (suggesting that adding a corporate opt-out is the better approach). The focus of his Article is to emphasize the compulsion of speech inherent in the corporate form, and to advocate for an opt-out from this compulsion. Although Sachs appears to want both options kept open, his Article's proposed solution would enshrine, rather than eliminate, the union opt-out rule.
84. 367 U.S. 740, 770 (1960).
85. Id. at 800 (Frankfurter, J., dissenting).
86. Id. at 814.
87. Sachs himself cites supporters of this argument.
88. Sachs, Unions, supra note 8, at 814 n.71.
89. David B. Gaebler, Union Political Activity or Collective Bargaining? First Amendment Limitations on the Uses of Union Shop Funds, 14 U.C. Davis L. Rev. 591, 601-02 (1981)
90. "In many instances, union political activity is integrally related to the pursuit of union representational goals."
91. Alan Hyde, Economic Labor Law v. Political Labor Relations: Dilemmas for Liberal Legalism, 60 Tex. L. Rev. 1, 33 (1981)
92. 'The myth that politics is distinct from economics is characteristic of Western liberal thought, and contemporary American labor law partakes of this myth.')). I have argued for this as well.
93. Matthew T. Bodie, Mother Jones Meets Gordon Gekko: The Complicated Relationship Between Labor and Private Equity, 79 U. Colo. L. Rev. 1317, 1353 (2008)
94. "We need to recognize that unions, like their negotiating counterparts, are in business. As such, they should be free to pursue their political objectives as any other business.".
95. 130 U.S. 876, 907 (2010).
96. Id. at 905.
97. Sachs, Unions, supra note 8, at 865-866.
98. Citizens United, 130 U.S. at 905.
99. Dan Eggen, Poll: Large Majority Opposes Supreme Court's Decision on Campaign Financing, Wash. Post (Feb. 17, 2010, 4:38 PM), http://www.washingtonpost.com/wpdyn/content/article/2010/02/17/AR2010021701151.html
100. On file with the Columbia Law Review ("Eight in 10 poll respondents say they oppose the high court's Jan. 21 decision").
101. Andrew Joseph, Poll: Most Voters Oppose Citizens United Decision, National Journal Influence Aley Blog (Jan. 20, 2012, 5:40 PM), http://influencealley.nationaljournal.com/2012/01/poll-mostvoters-oppose-citize.php.
102. On file with the Columbia Law Review ("62 percent of all voters oppose the Supreme Court's Citizens United decision").
103. Sachs, Unions, supra note 8, at 854-55 ('[W]hile both unions and corporations engage in the expression of political ideas and messages, unions are also the site for the development of political ideas among their memberships.').
104. Ann Zimmerman & Kris Maher, Wal-Mart Warns of Democratic Win, Wall St. J., Aug. 1, 2008, at A1.
105. 'Wal-Mart Stores Inc. is mobilizing its store managers and department supervisors around the country to warn that if Democrats win power in November, they'll likely change federal law to make it easier for workers to unionize companies-including Wal-Mart'.
106. The American Legislative Exchange Council (ALEC) is an example of corporations banding together to fund the development of state legislative initiatives.
107. Mike McIntire, Nonprofit Acts as a Stealth Business Lobbyist, N.Y. Times, April 22, 2012, at A1.
108. '[S]pecial interests effectively turn ALEC's lawmaker members into stealth lobbyists, providing them with talking points, signaling how they should vote and collaborating on bills affecting hundreds of issues like school vouchers and tobacco taxes.'.
109. Bodie, Information, supra note 54, at 52 ("[T]he union is trying to persuade its potential customers that they should purchase its services.")
110. Samuel Estreicher, Deregulating Union Democracy, 2000 Colum. Bus. L. Rev. 501, 514-516
111. Discussing market for representative services.
112. Kye D. Pawlenko, Reevaluating Inter-Union Competition: A Proposal to Resurrect Rival Unionism, 8 U. Pa. J. Lab. & Emp. L. 651 (2006).
113. Arguing for increased competition between unions for provisions of services to workers.
114. The NLRA allows employees in a particular 'bargaining unit' to choose a representative for that group of employees. See 29 U.S.C. § 159(a) (2006) ('Representatives designated or selected for the purposes of collective bargaining by the majority of the employees in a unit appropriate for such purposes, shall be the exclusive representatives of all the employees in such unit for the purposes of collective bargaining . . . .').
115. Davenport v. Wash. Educ. Ass'n, 551 U.S. 177, 181 (2007).
116. Act of Mar. 11, 2011, 2011-2012 Wisc. Legis. Serv. 29 (West), available at https://docs.legis.wisconsin.gov/document/acts/2011/10.pdf (prohibiting, inter alia, employers from collecting union dues).
117. Kris Maher & Douglas Belkin, Restrictions on Unions Become Law, Wall St. J., Mar. 12-13, 2011, at A3.
118. Dscribing anti-union effects of 2011 Wisconsin budgetact.
119. Lehmann, supra note 4, at 55 (discussing ties between SEIU and Obama Administration).
120. Jill E. Fisch, How Do Corporations Play Politics?: The FedEx Story, 58 Vand. L. Rev. 1495, 1503-11 (2005).
121. Discussing FedEx's lobbying for transportation policies.
122. Kim Severson, A Chicken Chain's Corporate Ethos Is Questioned by Gay Rights Advocates, N.Y. Times, Jan. 30, 2011, at A16.
123. Discussing gay rights advocates' unwillingness to eat Chick-fil-A after learning company supports anti-gay marriage efforts.
124. Citizens United v. FEC, 130 S. Ct. 876, 905 (2010) ('The First Amendment protects [speech funded by the marketplace], even if it was enabled by economic transactions with persons or entities who disagree with the speaker's ideas.').