Gilmore v. Gallego

552 P.3d 1084

Mark GILMORE,^* et al., Plaintiffs/Appellants,

v.Kate GALLEGO, et al., Defendants/Appellees.

No. CV-23-0130-PR

Supreme Court of Arizona.

Filed July 31, 2024

Appeal from the Superior Court in Maricopa County, The Honorable Daniel G. Martin, Judge, No. CV2019-009033. REVERSED AND REMANDED

Opinion of the Court of Appeals, Division One, 255 Ariz. 169 (App. 2023). VACATED

Jonathan Riches (argued), Timothy Sandefur, Scharf-Norton Center for Constitutional Litigation at the Goldwater Institute, Phoenix, Attorneys for Mark Gilmore and Mark Harder

John Alan Doran (argued), Matthew A. Hesketh and Carli J. Simkin, Sherman & Howard, L.L.C., Phoenix, Attorneys for Kate Gallego, Jeff Barton and the City of Phoenix

Daniel L. Bonnett (argued), Jennifer Kroll, Martin & Bonnett, P.L.L.C., Phoenix, Attorneys for American Federation of State, County and Municipal Employees, (AFSCME), Local 2384

Gerald Barrett, Ward, Keenan & Barrett, P.C., Phoenix; Leon Dayan, Joshua A. Segal and Bruce Lerner, Bredhoff & Kasier, P.L.L.C., Washington, D.C., Attorneys for Amicus Curiae Heidi Shierholz

Kristin K. Mayes, Arizona Attorney General, Alexander W. Samuels, Principal Deputy Solicitor General, Luci D. Davis, Senior Litigation Counsel, Phoenix, Attorneys for Amicus Curiae State of Arizona

Drew C. Ensign, Brennan Bowen, Holtzman Vogel Baran Torchinsky & Josefiak PLLC, Phoenix, Attorneys for Amici Curiae Arizona Free Enterprise Club and Grand Canyon Legal Center

Grant H. Frazier, Dustin D. Romney, Frazier Law, PLLC, Scottsdale; Bernard Zamaninia, National Right to Work Legal Defense Foundation, Inc., Springfield, Virginia, Attorneys for Amicus Curiae National Right to Work Legal Defense Foundation, Inc.

Dennis I. Wilenchik, John "Jack" D. Wilenchik, Garo V. Moughalian, Phoenix, Attorneys for Amicus Curiae Freedom Foundation

Jacob H. Huebert, Liberty Justice Center, Chicago, Illinois, Attorneys for Amicus Curiae Liberty Justice Center

JUSTICE BOLICK authored the Opinion of the Court, in which CHIEF JUSTICE TIMMER, VICE CHIEF JUSTICE LOPEZ, and JUSTICES BRUTINEL, BEENE, MONTGOMERY, and KING joined.

JUSTICE BOLICK, Opinion of the Court:

¶1 We consider here the constitutionality of "release time" provisions in a memorandum of understanding ("MOU") between the City of Phoenix (the "City") and the American Federation of Federal, State and Municipal Employees, Local 2384 (the "Union"). The provisions permit certain employees, while paid by the City, to be released from the duties for which they were hired to instead perform "lawful union activities" and other tasks under the Union’s direction.

¶2 We conclude that the release time provisions do not violate the free-speech or free-association guarantees of the First Amendment or article 2, section 6 of the Arizona Constitution, or the right-to-work protections of article 25 of the Arizona Constitution or A.R.S. § 23-1302, because the City, and not the employees, pays for the release time. Therefore, the employees are not compelled to subsidize speech with which they disagree, nor are they required to make a mandatory union contribution. See Janus v. Am. Fed’n of State, Cnty., & Mun. Emps., Council 31, 585 U.S. 878, 929–30, 138 S.Ct. 2448, 201 L.Ed.2d 924 (2018); Am. Fed’n of State, Cnty. & Mun. Emps., AFL-CIO Loc. 2384 v. City of Phoenix, 213 Ariz. 358, 366 ¶ 29, 142 P.3d 234 (App. 2006). However, we conclude that the provisions violate the Gift Clause of article 9, section 7 of the Arizona Constitution for the reasons detailed below.

BACKGROUND

¶3 The City organizes its employees into units "for the purpose of choosing an authorized representative to engage, in its behalf, in the meet and confer process." Phx., Ariz., Code ch. 2, art. 17 ("PCC") § 2-210(1). That is the process through which the City and the authorized representative of a unit bargain for "wages, hours, and other terms and conditions of employment" that are binding on all employees in the unit. PCC § 2-210(11). The terms agreed to by the City and authorized representative are memorialized in an MOU. Id. After the City Council approves the MOU, it becomes effective. PCC § 2-215(C). The maximum term for an MOU is three years. PCC § 2-215(B).

¶4 Unit II consists of approximately 1,500 skilled tradespeople. See PCC § 2-212(A)(2)(b). The Union has acted as Unit II’s authorized representative since 1976. Roughly 671 Unit II employees are members of the Union.

¶5 The Union and the City negotiate a new MOU for Unit II employees every two years. Generally, the MOUs contain "release time" provisions. While on release time, "employees are released from their normal job duties but still paid at the same rate(s) of pay by the City," Gilmore v. Gallego, 255 Ariz. 169, 173 ¶ 4, 529 P.3d 562, 566 (App. 2023), to engage in "lawful union activities." The MOU also provides examples of services that may be performed for the City or the Union on release time.

¶6 The 2014-2016 MOU, however, did not provide for release time. Under the 2014— 2016 MOU, Unit II employees received eight additional hours of vacation time that they could donate to a bank of hours to fund release time.

¶7 In 2019, the City and Union agreed to an MOU that included release time. Specifically, the MOU provided for (1) four full-time, paid release positions for Union members, including the Union President, "to engage in lawful union activities"; (2) a bank of 3,183 additional paid release time hours per year for Union members "to engage in lawful union activities"; (3) a bank of 150 additional paid release time hours per year for Union members to attend Union seminars, lectures, and conventions; and (4) $14,000 in reimbursements to the Union per year to pay for Union members to attend schools, conferences, workshops, and trainings.

¶8 The MOU states that the four full-time released employees "agree to participate" in "citywide task forces and committees, Labor-Management work groups, and a variety of Health and Safety committees." The Labor-Management Committee meets "monthly or at other mutually scheduled times." The Health and Safety Committee meets "quarterly or at other mutually scheduled times." Because serving on these committees "take[s] time away from [the] expected [Union] tasks" of released employees, the MOU provides the Union President with 208 hours in his compensatory time bank and the other three full-time released employees with eighty hours each in their compensatory time banks per year. Under such circumstances, the released employees receive both their salaries and compensatory time, as well as City benefits and pension eligibility.

¶9 The MOU authorizes the Union to designate union stewards to represent Unit II employees in grievance proceedings. The MOU states employees "have the right to have the Union serve as their ‘meet and confer’ representative" and to be represented by the Union in grievance proceedings, regardless of membership in the Union.

¶10 The MOU also provides "examples" of how release time may be used:

Examples of work performed by the release positions in support of the City include ensuring representation for employees during administrative investigations and grievance/disciplinary appeal meetings with management; participating in collaborative labor-management initiatives that benefit the City and the members; serving on City and departmental task forces and committees; facilitating effective communication between City and Department management and employees; assisting members in understanding and following work rules; and administering the provisions of the Memorandum of Understanding. Union release is also used for authorized employees to prepare for appeals and hearings and attend Union conferences, meetings, seminars, training classes and workshops so that employees better understand issues such as City policies and practices, conflict resolution, labor-management partnerships, and methods of effective representation.

(Emphasis omitted.) However, in practice, release time is also used for unlisted activities, like Union recruitment. Although the City ordinarily controls and supervises employee activities, it does not control or supervise how released employees spend their time and released employees do not report their activities to the City.

¶11 The MOU’s release time provisions cost the City approximately $499,000 per year. The MOU states, "[t]he cost to the City for these release positions and release hours, including all benefits, has been charged as part of the total compensation detailed in this agreement."

¶12 At all relevant times, Petitioners Mark Gilmore and Mark Harder (the "Employees") worked in Unit II but did not belong to the Union. Gilmore, 255 Ariz. at 174 ¶ 6, 529 P.3d at 567. The Employees sued the City, arguing the MOU’s release time provisions violate their free-speech, free-association, and right-to-work rights. Id. The Employees also alleged the release time provisions violate the Gift Clause. Id. The Union intervened as a defendant. Id. We refer to the City and the Union collectively as the "Respondents." The Employees and the Respondents filed motions for summary judgment on all claims. Id. ¶ 7. The trial court granted the Respondents’ motion for summary judgment. Id. The trial court determined release time did not violate the Employees’ free-speech, free-association, and right-to-work rights because the Employees do not pay for release time. Id. The trial court also determined the release time provisions did not violate the Gift Clause because they serve a public purpose and are supported by adequate consideration. Id.

¶13 The Employees appealed. Id. ¶ 8. The court of appeals, in a split opinion, affirmed the trial court’s grant of summary judgment in favor of the Respondents. Id. at 182 ¶ 45, 529 P.3d at 575. Like the trial court, the court of appeals held that the release time provisions did not violate the Employees’ free-speech, free-association, and right-to-work rights because the Employees do not...