Agency shop orders

Trade union members march through Fyzabad for Labour Day observances on June 19, 2022. - Lincoln Holder
Trade union members march through Fyzabad for Labour Day observances on June 19, 2022. - Lincoln Holder

Part 6 of the Industrial Relations Act (the act) – Miscellaneous and General – which commences at Section 71, is the only provision in the act that expressly conveys and bestows specific rights to every worker in this country.

This section gives all workers rights with respect to trade-union membership, non-membership and related activities. It’s simply his or her choice, and that’s a legal right. These rights are consistent with sections 4 and 5 of our Constitution, relating to the general right of freedom of association.

Sections 72-76, however, establish the statutory mechanism for the creation of a workplace environment as an agency shop, by empowering the Registration, Recognition and Certification Board (RRCB) to make and issue agency shop orders.

Most people, including long-standing HR professionals as well as some seasoned IR practitioners, have very little working knowledge of what an agency shop order is and how it affects a business undertaking in general, and its workers in particular.

First of all, in TT an agency-shop environment can only exist where a recognised majority union (RMU) is certified for certain bargaining units in a business undertaking. Such an order made by the RRCB, therefore, can only be directed at specific bargaining units. An agency shop is therefore a place of employment where union members pay union dues, and other workers in the bargaining unit who are not members of the RMU pay a specified contribution, or service fees, to the union for the benefit of union representation, as well as to cover the cost of collective bargaining.

The legality of agency shops varies widely from country to country; therefore, agreements are generally highly regulated in developed countries, because in some European countries, a union and a company can enter into an agency shop agreement which allows the employer to hire both union and non-union workers without harming the trade union.

In the US, the Supreme Court upheld the legal permissibility of agency-shop service fees for non-union employees in the 1977 case of Abood v Detroit Board of Education. The court ruled that a government employer and the union may reach an agreement requiring employees to pay an agency service fee covering the costs of collective bargaining, contract administration, and grievance representation. However, Abood clarified that objecting non-union employees had a legal right to withhold payment of any agency service fees that supported political and ideological causes.

In other words, objecting non-union employees could be compelled to pay only those expenses directly related to collective bargaining fees, and should not be used by unions to subsidise ideological or political causes or perspectives.

On the basis of Abood, all public employees had a constitutional right to prevent a union from spending part or all of their required agency service fees on political contributions or costs associated with the advancement of political views that were unrelated to the union’s duties as the exclusive bargaining agent of the workers in the bargaining unit.

However, in Janus v American Federation of State, County, and Municipal Employees (2018), the Supreme Court, with its conservative majority, overturned Abood and invalidated the agency shop for all public-sector employees, holding that mandatory service fees effectively compel non-union employees to subsidise union speech on matters of “great public importance,” because the unions’ collective bargaining concerns affect public policies regarding government budgets, taxes and related issues.

This was indeed a devastating blow to public-sector unions in the US, as it legitimised the concept of “freeloaders,” under which non-union bargaining unit employees now enjoy all the benefits of a union’s collective bargaining efforts for free.

The provisions in our legislation, however, are aimed directly at preventing this.

The provisions of Section 74(9) are the penalty mandates of Part 6 of the IRA. It criminalises the action of an employer who fails to comply with requirements set out in an agency shop order. This is a criminal offence, and the employer becomes liable, on summary conviction, to a fine of $1,000 or to imprisonment for six months. Since it is a difficult proposition to incarcerate an employer, as this is normally a legally registered company, generally, the fines will apply.

About four years ago I accepted a brief from a client to appear before the RRCB to defend a claim brought by its RMU that it was in violation of the terms of a longstanding agency shop order. At the time, this order was about 17 years old and no doubt, the company had changed significantly during the period. As a matter of fact, the number of workers in the bargaining unit in question had decreased from 54 to only three, with the longest serving having six years of service. Indeed, the order itself had become obsolete and the Union never applied for a variation of the terms of the order at any time during the period.

The examiner from the RRCB herself had never dealt with any such claim before and was clearly in a predicament when I argued that the matter was improperly before her. Indeed, the RRCB had no jurisdiction to hear and determine any such claim, as it had no power to impose a fine, far less order the incarceration of anyone.

The claim was eventually dismissed. The union would have had to report the matter to the police, who would have had no clue how to proceed.

Like many other provisions in the IRA, the entire mechanism for making agency shop orders is in urgent need of revision. However, the concept itself is democratic in nature, steeped in the principle of equity, and should therefore be retained.


"Agency shop orders"

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