Jottings By An Employer's Lawyer

Sunday, December 11, 2005

Government Aid to Organized Labor, Chapter 2 in 7th Circuit

Twice this month the 7th Circuit has considered challenges to legislative enactments designed to aid organized labor. It's a split decision as this time it ends much more to labor's liking. The 7th Circuit upholds an Illinois state law requiring a project labor agreement for state subsidized renewable fuel plants. Northern Illinois Chapter of ABC v. Lavin (7th Cir. 12/9/05) [pdf]. The difference between this and the case 2 days earlier? [see 7th Circuit Overturns Local Government Mandated Labor Peace Agreements ] In Milwaukee County a purchasing rule prescribing how employers must handle labor relations in all aspects of their business was pre-empted, but here - a conditioned subsidy was not.

Along the way, Judge Easterbrook makes a few common sense points -- the kind everyone knows, but not always said:
about project agreements -- As a practical matter such agreements can
be achieved only by employers that recognize and bargain with labor unions.
conditional funding as a regulation --The question “is a condition on the receipt of a grant a form of regulation?” comes up frequently, and the answer almost always is negative.
effects of a subsidy -- The lure of a subsidy may lead firms at the margin to reach labor agreements.
reason for the subsidy -- If (as seems likely) Illinois has taken the approach in this law because state officials want to assist organized labor as well as the farmers who supply the grain to be made into ethanol and the owners of ethanol plants, that is neither a surprise nor a reason for invalidity...
why government projects cost so much - - Many a public project is bigger or more expensive than it need be, in order to enlist the support of multiple interest groups.
Refreshing to hear common sense. It would be even better to hear it from members of the other two branches of government.

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