JUNE/
JULY
2008
IN THIS ISSUE
MANAGEMENT UPDATE
WWW.FOR DHARRISON .COM
IN THIS ISSUE
FEDERA L LABOR LAW PRE-EMP TS CALIFORNIA’S PROH IBITION 1
ON USE OF STATE FUNDS T O PROMOTE OR DETER ORG ANIZING
SUPREME COUR T’S ANTICLIMAC TIC DECISION IN GLENN DOES 2
NOT STRE AMLINE ERISA LITIG ATION
SUPREME COUR T FINDS STATE DISABILIT Y PENSION PLAN 4
DOES NOT VIOL ATE ADEA
HOW DOES CAL IFORNIA’S SAME-SEX M ARRIAGE DECISION 5
IMPACT EMPLO YERS
Federal Labor Law Pre-empts California’s
Prohibition on Use of State Funds to Promote or
Deter Organizing
The U.S. Supreme Cour t has held that a California law that prohibits employers who receive state funds from using those funds
to “assist, promote, or deter union organizing” is pre-empted by federal labor law. See Chamber of Commerce v. Brown (June 19,
2008).
Background: AB 1889 forbids certain employers that receive state funds from using such funds to “assist, promote, or deter union
organizing.” See Cal. Govt. Code Ann. §§16645 – 16649. The statute specifies that the spending restriction applies to “any expense,
including legal and consulting fees and salaries of supervisors and employees, incurred for . . . an activity to assist, promote, or deter
union organizing.” §16646(a). Although it purports to have a neutral purpose, the statute exempts activities performed or expenses
incurred in connection with undertakings that promote unionization.
The law requires covered employers to certify that no state funds will be used for prohibited expenditures and to maintain and
provide, upon request, “records sufficient to show that no state funds were used for those expenditures.” Violators are liable to the
state for the amount of the funds spent in violation of the law plus a civil penalty equal to twice the amount of those funds. Suspected
violators may be sued by the state attorney general or any private taxpayer, and prevailing plaintiffs are entitled to recover reasonable
attorney’s fees and costs.
In 2002, several organizations whose members do business in California sued the state to enjoin enforcement of the law. The Ninth
Circuit held that the National Labor Relations Act (NLRA) does not preclude enforcement of the law. The Supreme Court overruled
this decision.
Machinists Pre-Emption: The Cour t held that AB 1889 is pre-empted under the Machinists pre-emption analysis. Machinists pre-
emption forbids states and the National Labor Relations Board (the Board) from regulating conduct that Congress intended to be left
Continued on pg. 3
WWW.FORDHARRISON.COM
mANAGEmENT UPdATE
In tHIS ISSuE JUNE/
fEDEral labor law prE-EMptS CalIfornIa’S proHIbItIon 1JULY
on uSE of StatE funDS to proMotE or DEtEr organIzIng
SuprEME Court’S antIClIMaCtIC DECISIon In glEnn DoES 2
not StrEaMlInE ErISa lItIgatIon
SuprEME Court fInDS StatE DISabIlIty pEnSIon plan 4
DoES not vIolatE aDEa
How DoES CalIfornIa’S SaME-SEX MarrIagE DECISIon 5
IMpaCt EMployErS
federal labor law pre-empts California’s
prohibition on use of State funds to promote or
Deter organizing
The U.S. Supreme Court has held that a California law that prohibits employers who receive state funds from using those funds
to “assist, promote, or deter union organizing” is pre-empted by federal labor law. See Chamber of Commerce v. Brown (June 19,
2008).
Background: AB 1889 forbids certain employers that receive state funds from using such funds to “assist, promote, or deter union
organizing.” See Cal. Govt. Code Ann. §§16645 - 16649. The statute specifies that the spending restriction applies to “any expense,
including legal and consulting fees and salaries of supervisors and employees, incurred for . . . an activity to assist, promote, or deter
union organizing.” §16646(a). Although it purports to have a neutral purpose, the statute exempts activities performed or expenses
incurred in connection with undertakings that promote unionization.
The law requires covered employers to certify that no state funds will be used for prohibited expenditures and to maintain and
provide, upon request, “records sufficient to show that no state funds were used for those expenditures.” Violators are liable to the
state for the amount of the funds spent in violation of the law plus a civil penalty equal to twice the amount of those funds. Suspected
violators may be sued by the state attorney general or any private taxpayer, and prevailing plaintiffs are entitled to recover reasonable
attorney’s fees and costs.
In 2002, several organizations whose members do business in California sued the state to enjoin enforcement of the law. The Ninth
Circuit held that the National Labor Relations Act (NLRA) does not preclude enforcement of the law. The Supreme Court overruled
this decision.
Machinists Pre-Emption: The Court held that AB 1889 is pre-empted under the Machinists pre-emption analysis. Machinists pre-
emption forbids states and the National Labor Relations Board (the Board) from regulating conduct that Congress intended to be left
Continued on pg.
3
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