Gig News: Court Enjoins Enforcement of Seattle Gig Unionization Ordinance

Judge Robert S. Lasnik of the U.S. District Court for the Western District of Washington has enjoined enforcement of Seattle’s first-in-the-nation ordinance giving gig economy independent contractors the right to unionize (the “Ordinance”.)  Judge Lasnik’s full decision granting the U.S. Chamber of Commerce’s motion for preliminary injunctive relief in Chamber of Commerce of the United States of America v. City of Seattle can be found here.  Uber, Lyft and a third ride hailing company had been due to submit driver information this week to a union recognized as a “qualified driver representative” pursuant to the Ordinance, but the requirements “are hereby enjoined until this matter is finally resolved.”

Notably, Judge Lasnik found that the Chamber may succeed on the merits of its antitrust claim, pending analysis of the City’s claim for antitrust immunity, but that the Chamber and drivers challenging the Ordinance in a consolidated lawsuit are unlikely to succeed on their National Labor Relations Act preemption claims at the moment.  Judge Lasnik stressed “that this Order should not be read as a harbinger of what the ultimate decision in this case will be when all dispositive motions are fully briefed and considered.  The plaintiffs have raised serious questions that deserve careful, rigorous judicial attention, not a fast-tracked rush to judgment based on a date that has no extrinsic importance.”

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Gig News: Seattle Gig Unionization Ordinance On Hold

Despite surviving multiple court challenges, the revolutionary Seattle municipal ordinance giving gig economy independent contractors the right to unionize appears to be on hold.

According to Bloomberg BNA, a Seattle city attorney announced the city will delay enforcement of the law in proceedings before the district court hearing the challenge to the ordinance last week.  Uber, Lyft and a third ride hailing company had been due to submit driver information today to a union recognized as a “qualified driver representative” pursuant to the ordinance.  Seattle will not requite the companies to disclose the driver information until Judge Robert S. Lasnik of the U.S. District Court for the Western District of Washington rules on a motion filed by the U.S. Chamber of Commerce, which brought the lawsuit challenging the ordinance.

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Birmingham & The Impact of Race on State Preemption Laws

Early last year, Alabama passed a preemption law preventing any city in the state from, among other things, setting their own minimum wage.  The law was perceived to be targeting Birmingham, the only city in Alabama to have enacted a minimum wage ordinance that went beyond the federal minimum wage.  In response, the NAACP filed a lawsuit arguing that the state’s blocking of Birmingham’s minimum wage hike was done “with racial animus” and violated both the Equal Protection Clause and the Voting Rights Act.  Last month, a federal judge in Birmingham dismissed the suit, which is now being appealed to the 11th Circuit.  As states across the country increasingly pursue preemption to nullify or prevent cities from raising their minimum wage, the lawsuit filed in Birmingham is one of the first to raise the prospect of racial discrimination in the use of preemption, prompting the question: what role does race play in state preemption laws?

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Regulating Guns in the Workplace

This January, Ohio adopted a firearm regulation commonly referred to as a parking lot law.  The law’s core provision prevents both private and public employers from enforcing workplace policies that prohibit employees with concealed carry permits from keeping their firearms in their cars while in employer parking lots.  Ohio’s law is not the first of its kind.  Oklahoma was the first state to pass a parking lot law; it amended existing legislation in 2004 to protect firearm owners from prohibitions on firearms in workplace parking lots.  As of 2016, more than 20 states have enacted similar parking lot provisions.  Passed in response to robust lobbying campaigns by gun-rights groups such as the National Rifle Association, parking lot laws vary in the level of protection they offer gun owners, but most prohibit employers from asking employees if they own guns, and prohibit employers from firing employees because they own firearms.  These laws are frequently in conflict with existing workplace policies, which often limit employee’s ability to bring firearms to work.  These types of laws pose major questions about an employer’s ability create comprehensive health and safety policies.  On purely legal grounds, it is difficult to conclusively say that state legislatures’ regulation of guns in the workplace is impermissible.  However, parking lots laws undoubtedly raise significant questions about how much discretion employers should have in regulating employee conduct.

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The Politics of Preemption and Local Labor Laws: From Minimum Wage to “Right to Work”

Increasingly frustrated by their inability to affect employment law at the federal and state level, progressive advocates have turned their attention to local government.  At this level, they have been able to enact ordinances to raise the minimum wage, guarantee paid sick day laws, and even protect LBGT rights in the workplace — proposals, which have all failed at the federal level.  Conservative groups, most notably, the American Legislative Exchange Council (ALEC), have fought these reforms by lobbying for state bills preempting local action.

But, in another context, this dynamic has been turned on its head: ALEC has led the campaign to enact local right to work ordinances.  While ALEC’s instrumentalism has been noted, progressives also have a conflicted position on preemption.  In the face of a rigid preemption regime governing federal labor law, the progressives cannot explore whether the NLRA would benefit from more regional variation as it has in the minimum wage context.

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Right-to-Work: Seventh Circuit Splits 5-5 on Rehearing Sweeney v. Pence

The seventh circuit yesterday denied appellants’ petition for rehearing en banc in Sweeney v. Pence, a case involving the legality of Indiana’s right-to-work law. But the vote on the petition was 5-5: Judges Posner, Rovner, Wood, Williams, and Hamilton dissented from the denial “for the reasons stated in Chief Judge Wood’s dissent to the panel opinion.” Despite the outcome here, the vote is an indication that there is now substantial support for the proposition that right-to-work laws like Indiana’s are preempted by federal labor law. Judge Wood’s dissent can be found here. Catherine Fisk and I filed an amicus brief urging rehearing in Sweeney, and we summarized the preemption argument as follows:

In a forthcoming article, we conclude that right-to-work laws like Indiana’s are preempted by federal law to the extent they prohibit collective bargaining agreements that require nonmembers to pay less than union dues and fees. See Catherine Fisk & Benjamin Sachs, Restoring Equity in Right to Work Laws, 4 U.C. Irvine L. Rev. 859, 862-68 (2014).  The National Labor Relations Act broadly preempts state laws regulating union-management relations and provides the exclusive source of law governing the interpretation and validity of collective bargaining agreements. See Teamsters Local 174 v. Lucas Flour, 369 U.S. 95 (1962); San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236 (1959). With the limited exception to preemption of section 14(b), 29 U.S.C. § 164(b), the validity of fair share fee provisions of collective bargaining agreements is governed exclusively by federal law. Section 14(b) saves from preemption only state laws invalidating agreements requiring nonmembers to pay the same as is required of members. To the extent that Indiana Code § 22-6-6-8 invalidates collective agreements requiring nonmembers to pay less than is required of members, it is not within the section 14(b) savings provision. Accordingly, this Court should grant the petition for rehearing en banc and hold that federal labor law preempts the Indiana right-to-work law.

Local Labor Law

Moshe Marvit has an interesting new piece in The Nation about a push to pass local (city- and county-level) right-to-work legislation. Marvit’s piece responds to a Heritage Foundation paper (by James Sherk and Andrew Kloster) that argues in favor of such legislation and to an upcoming ALEC meeting at which such legislation will be discussed. The idea of local right-to-work (RTW) laws raises both legal and policy questions. Marvit’s views on both seem relatively clear: the piece suggests that local RTW laws are impermissible because they are preempted by federal labor law, and that such laws are bad policy, constituting “another front on the war on workers” and amounting to “the equivalent of allowing people to choose to pay or not pay taxes for the services provided by a democratically elected government.”

Marvit deserves great credit (as usual) for bringing an important labor development to light. But I have somewhat different views on both the legal and policy points.

On the law, Marvit states the question correctly. 29 U.S.C. §164 allows “any State or Territory” to have RTW laws, and so the question is whether, by referring only to States and Territories, Congress meant to prohibit cities and counties from enacting RTW legislation. Marvit thinks the answer is clear. Writing about Sherk and Kloster’s argument that §164 allows local RTW laws, Marvit comments: “If this sounds like a bizarre and over-broad reading of the law, that’s because it almost certainly is.”

Sherk and Kloster may well be wrong, but it’s not obvious that they are. Continue reading