12/10/2013 06:16 pm ET Updated Feb 09, 2014

Supreme Court Withdraws Review of Union Organizing Campaign Employer-Union Aid Agreement

Congress enacted Section 302 of the Labor Management Relations Act (LMRA) in an attempt to reduce corruption by prohibiting employers from giving to unions or unions receiving from employers any "thing of value" subject to a few exceptions. The federal Court of Appeals for the Eleventh Circuit decided in 2012 that intangible organizing assistance offered by an employer to a union, if demanded or given in payment, violated Section 302 (UNITE HERE Local 355 v. Mulhall). The Eleventh Circuit case involved an employer's agreement granting a union work premises access, a list of employee names and contact information, and employer neutrality in the union's organizing campaign. The union in exchange agreed to give the employer funds to support a casino gambling ballot initiative that was beneficial to the employer.

The Eleventh Circuit's decision was contrary to prior decisions by federal Courts of Appeal for the Third and Fourth Circuits. Those courts had determined that an employer neutrality agreement was not a "thing of value" under Section 302.

In the Eleventh Circuit case, Mulhall was an employee opposed to unionization. He sought a court injunction prohibiting the employer-union agreement as being in violation of the LMRA. The trial court dismissed Mulhall's complaint and he appealed. In 2010 the Eleventh Circuit decided that Mulhall could bring his complaint to court (he had "standing"). A second appeal to the Eleventh Circuit involved the interpretation of "thing of value" under Section 302. After reviewing decisions interpreting "thing of value," the Eleventh Circuit decided to follow a Second Circuit determination that what is a "thing of value" depends upon the circumstances. Common sense should determine what a "thing of value" is in a given situation.

The U.S. Supreme Court agreed on June 24, 2013, to review the Eleventh Circuit's decision. Then, after legal briefs and oral argument, on December 10, 2013, the U.S. Supreme Court dismissed the petition to review as "improvidently granted." Justices Breyer, Sotomayor, and Kagan dissented from the dismissal in a brief statement. They indicated the case could be considered moot since the agreement in question had expired in 2011 prior to the Eleventh Circuit's 2012 decision. Also it is possible that Mulhall lacked standing to bring his case. The three Justices stated that the Supreme Court should have asked for additional legal briefs on these two questions (mootness and standing) as well as a third question concerning whether Section 302 authorizes a private right of action in addition to actions by the Federal Government.

However, since the Supreme Court has decided not to review, the Eleventh Circuit's 2012 decision stands. That decision remanded the case to the trial court to consider further the Section 302 claim and determine the reason for the employer-union agreement. The Eleventh Circuit stated that an employer's neutrality or cooperation during a union organizing campaign is not a Section 302 violation unless that assistance is an improper payment.

When the Supreme Court decides that a petition was "improvidently granted," it does not explain its reasoning. The three dissenting Justices in this case believed that not reviewing the Eleventh Circuit's decision might negatively impact collective bargaining. The Eleventh Circuit's decision, in their view, "raises the specter" of criminal charges being brought if an employer or union official was determined to have made certain "commonplace organizing assistance agreements" intending to "corrupt" or "extort."

If the reader has stayed with this summarized presentation, the original being even more detailed and technical, he or she may wish that the legal system utilized more "common sense." However, common sense is itself subject to interpretation and may be utilized to cloak arbitrary actions. Hence, however tedious, detailed, and plodding the legal system may be, the alternative of rapid summary action may be even worse.