In 2012, Michigan enacted a right-to-work statute that prevented employees from being forced to join or financially support a labor union as a condition of employment. On Friday, March 24, 2023, Michigan became the first state in 58 years to repeal its right-to-work statute. The repeal will take effect on March 30, 2024, and have a significant impact on employees, employers, and labor unions alike.

Right to Work Briefly Explained

Unions in non-right-to-work states typically negotiate into collective bargaining agreements provisions known as union security clauses, which require employees to join or financially support a union as a condition of employment.

Section 14(b) of the National Labor Relations Act protects the right of states to negate union security clauses by enacting right-to-work statutes. Not counting Michigan, 26 U.S. states have such statutes. Although right-to-work statutes vary from state to state, they generally prohibit unions from enforcing union security clauses. This allows employees in right-to-work states to decline or resign from union membership and avoid paying union dues. Therefore, right-to-work statutes protect free choice and force unions to offer services that employees consider worth the cost of union dues. Labor unions are legally prohibited from discriminating against employees in right-to-work states who decide not to join the union and pay dues. This means they must spend resources on employees without a guarantee of collecting dues in return, which is the primary reason labor unions dislike such statutes and spend considerable time and effort trying to get them repealed.

What Happened in Michigan

Michigan’s 2012 right-to-work statute currently prohibits an individual from being required to do any of the following to obtain or continue employment:

• Refrain from or resign from membership in, affiliation with, or financial support of a labor organization.
• Become or remain a member of a labor organization.
• Pay any dues, fees, or other charges to a labor organization.
• Pay a charitable organization or another third party an amount of money equivalent to dues, fees, or other charges that are required to be represented by a labor organization.

Senate Bill No. 34 (“SB 34”) eliminates Michigan’s right-to-work legislation entirely. Under SB 34, employees in unionized workplaces will no longer have a statutory right to opt out of union membership or refrain from paying union dues or fees as a condition of employment. SB 34, therefore, legalizes union security clauses in collective bargaining agreements that force employees to pay dues, fees, assessments, or expenses that support labor unions and that permit unions to force employers to discharge employees who refuse to do so through the application of union security clauses. It also removes the financial penalty for using force, intimidation, or threats to compel employees to join or not join a union, affiliate with or financially support a union, and/or pay a charitable organization or another third party an amount of money equivalent to dues, fees, or other charges that are required to be represented by a labor union.

Notably, Michigan’s legislature also took measures to prevent the enactment of other right-to-work protections in the state going forward. For instance, SB 34 restricts municipalities from enacting right-to-work ordinances, by expressly stating that no local governmental law or policy can prohibit or limit any agreement requiring employees to pay dues or service fees to a labor organization as a condition of employment.

SB 34 also includes a $1 million financial appropriation measure to the Michigan Department of Labor and Economic Opportunity. This appropriations measure in SB 34 is likely to make the bill “referendum proof.” While Article 2, Section 9 of the State Constitution allows voters to approve or reject laws enacted by the legislature through referenda, that right does not extend to appropriations. By attaching appropriations to SB 34, the legislature blocked Michigan voters from repealing SB 34 through the referendum process. This leaves a constitutional amendment, a court decision, or another legislative bill as the remaining vehicles to overturn the law. Notably, Governor Whitmer signed SB 34 into law despite vowing in January 2019 to “veto legislation that circumvents the right to a referendum.”

The Impact of SB 34

It is anticipated that unions in Michigan will seek to take advantage of the change in law. Employers that bargained union security clauses out of their contracts following the passage of Michigan’s right-to-work statute in 2012 can expect unions to attempt to reinstate them when the collective bargaining agreement reopens. Employers that bargained language merely suspending union security clauses while the right-to-work statute was in effect can expect unions to seek to revive them mid-term. The right of employers in the latter situation to insist upon bargaining about the effects of such a change is unclear.

Employees will certainly have questions about how the repeal will affect them and employers should be prepared to answer these lawfully. For instance, employees may not be familiar with union security clauses and/or how to become a Beck objector under Communications Workers of America v. Beck, 487 U.S. 735 (1988), which allows employees subject to union security provisions to become nonmembers and only pay the portion of union dues necessary to the union’s performance of its representational duties.  

Conclusion

Michigan employers should be prepared to address union attempts to revive or establish union security provisions, including identifying the scope and limits of the employer’s bargaining obligations. As significant as SB 34 will be to the terms and conditions of employment in Michigan, and to the coffers of labor unions with members in that state, it is unlikely to spark a nationwide shift in the remaining right-to-work states. To do that, unions would need changes in federal law, such as those sought by organized labor in the stalled 2023 PRO Act.