Wages, Payroll, Deductions and a Lawsuit

Aug 04, 2023 at 03:11 pm by JC Bowman

On May 16, 2023, Governor Bill Lee signed Public Chapter 437 into law. The union subsequently filed a lawsuit: Tennessee Education Association, et al., versus Bill Lee, et al. Late on Friday, July 28, 2023, the Chancery Court for the State of Tennessee, Twentieth Judicial denied the Tennessee Education Association’s request for a temporary injunction against Section 2 of Chapter 437 of the Public Acts of 2023 (PC 437).”

The denial of the motion eliminates a previous temporary injunction to continue payroll deduction for dues for professional employee organizations. The results were predictable. The court was quick to point out the fallacies of the union arguments.

The increases in the base salaries in the state salary schedule for teachers that Professional Educators of Tennessee had long advocated, did include a ban on dues collection by a Local Education Association in the legislation. This impacted our organization on a smaller scale. Like the union, we would have preferred both issues addressed separately. As is often the case, legislation can be complex and cover a multitude of issues.

However, this legislation did not contain a severability clause that would allow the remainder of the legislation's terms to remain effective, even if one or more of its other terms or provisions are unenforceable or illegal. The union argument is that the Act combines two subjects, but only one portion of the Act is related to wages. The order points out: “Without wages, there is no payroll, and without payroll, there can be no payroll deductions.” 

Our point was that we were unwilling to risk losing the salary increases for all educators across the state that we had long advocated for because of the lack of a severability clause. In addition, we have long been denied equal access to payroll deductions. The union was often an obstacle to us for that equal access. Therefore, we created our own online system where members could pay their dues conveniently and securely. Despite our own increased costs in the form of credit cards and bank processing fees, we have been able to keep our annual dues under $200 a year.

In this case, each Local Education Association operates under a “unified membership structure” with the Tennessee Education Association and the National Education Association. Therefore, any educator who joins a local affiliate “also agrees to join the TEA and NEA and to pay the dues required for membership in each of the associations.” Nationally, according to the Education Intelligence Agency:  The “average union teacher paid $650.64 plus local dues.”

A couple of interesting points were relevant: Local Boards of Education already had the right to change their payroll practices. Payroll deductions for political activities are specifically excluded from the collaborative conferencing process under PECCA. See Tenn. Code Ann. § 49-5-608(b)(6). A 2016 Attorney General Opinion states that “member dues, if deducted under a PECCA memorandum of understanding, may not be used to engage in or pay for political activity, including political communications, nor may they be used as contributions to an entity that engages in political activity.”

The National Education Association is the largest labor union in the country. Some public sector unions limit a member’s ability to terminate their membership by requiring that it be done during a very narrow window, say the month of August. According to TEA president Tonya Coats’ testimony cited in the order: “Members may opt out of automatic deduction payments between August 1 and August 31 of each year; otherwise, the deductions take place on a continuing basis.” It was the first time experts recall seeing an “opt-out window” acknowledged.

Whether this is political payback to the state or national union as has been suggested, or simply good policy that diminishes the workload and costs imposed on local school districts, the legal challenge is unlikely to prevail. Teacher unions have been deeply involved in endorsing political candidates and funding political candidates and activities—including political action committees. Rank-and-file members of the union remain in the dark about political spending.

In 2021, Americans for Fair Treatment, reports “the teachers union donated $66 million to political activities and another $117 million to contributions, gifts, and grants that were primarily political donations.” This was at the national level.

Attorney General Jonathan Skrmetti included this footnote within one filing: “Since PECCA was enacted in 2011, the Tennessee Education Association (“TEA”) has engaged in extensive political activity. Its public filings show that it has spent approximately $2,000,000-$3,500,000 in Tennessee on lobbying alone. See Smith Decl., Ex. D, TEA Political Expense Reports. And the TEA’s membership applications provide that “a portion of [each member’s] dues are allocated to the TEA-FCPE,” an entity that engages in political activities, “including but not limited to, making contributions to and expenditures on behalf of friends of public education who are candidates for office.”  That makes the union look less like a membership organization, and more like a political organization. Political spending in a divided political climate does nothing to help Tennessee educators advocate on behalf of their students or themselves.

The conclusion of the order makes clear: “We hold that the Plaintiffs are unlikely to succeed on the merits of either claim. The Act does not impermissibly embrace more than one subject, and its caption fairly describes its contents. The Act also does not repeal PECCA’s requirement that payroll deductions be discussed as part of the collaborative conferencing process. Finally, Plaintiffs have failed to show that the Act substantially impairs either set of contracts implicated by the change in the payroll deduction process.”

The state has already filed for dismissal of the lawsuit. We await that decision.


 JC Bowman is the executive director of Professional Educators of Tennessee

Sections: Education

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