18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 507 Council of the East Side Human Attendant Service – filed a motion to intervene, as well as a motion to dismiss or stay. The Court denied the Proposed Intervenors’ motions. Both the Union and Defendants opposed the motion to intervene on the basis that the Proposed Intervenors lacked Article III standing to challenge the Arbitrator’s award and failed to satisfy the requirements for intervention under Rule 24. The Court agreed. It held that “‘an individual employee represented by a union [in a labor arbitration] generally does not have standing to challenge an arbitration proceeding to which the union and the employer were the only parties,’” which was precisely the situation here. Id. at *14-15. The Court also noted that the Proposed Intervenors’ alleged interest in the litigation was too remote to be cognizable, as required by Rule 24. Regarding the motion to dismiss or stay, the Proposed Intervenors argued that the Arbitrator’s award was not ripe for review because it did not cover damages or liability, and thus was not a final award. However, the Court reasoned that the award was sufficiently final since the Arbitrator provided an answer to the issue on which the parties sought a decision, i.e. , the scope of the arbitration. With respect to the Arbitrator’s award, the Court further held that the CBAs clearly required that grievances be arbitrated, and the subsequent MOA clarified that claims concerning “covered statutes,” which included relevant wage & hour laws, must be arbitrated. Id. at *30. The Proposed Intervenors argued that the Arbitrator’s decision was improper because the Proposed Intervenors were no longer employees when the 2015 MOA took effect, but the Court rejected this contention since it could not decide “an arbitrability question that the parties have delegated to an arbitrator.’” Id. at *32. Accordingly, the Court denied the Proposed Intervenors motions to intervene and to dismiss. Pellegrino, et al. v. New York State United Teachers, 2021 U.S. App. LEXIS 10748 (2d Cir. April 13, 2021). Plaintiffs, a group of teachers, filed a class action alleging that dues paid to their teachers’ union should be returned to them in light of the U.S. Supreme Court’s ruling that such fees were invalid in Janus v. American Federation of State, County, & Municipal Employees, Council 31 , 138 S. Ct. 2448 (2018). The District Court granted Defendants’ motion to dismiss pursuant to Rule 12(b)(6) on the basis that Defendant’s good faith affirmative defense foreclosed Plaintiffs’ claims. On appeal, the Second Circuit affirmed the District Court’s ruling. Plaintiffs contended that Defendants’ collection of fees from non-members or objecting employees was unconstitutional in light of Janus . The Supreme Court’s decision in Janus decided that collection of public-sector union fees to which employees are opposed violates their First Amendment rights. Following the decision, Defendants ceased collecting agency fees. Plaintiffs contended that any pre- Janus fees paid should be returned. The Second Circuit reasoned that since the allegations in the complaint established that the Union collected fees in reliance on New York state statutes that authorized the practice, which were constitutionally valid until Janus, the good faith defense was applicable to Defendants’ actions. The Second Circuit ruled that based on binding precedent, as long as a union is alleged to have collected funds in reliance on then-effective law, it has no obligation to repay those funds when the law is later overturned. Id . at *5. Accordingly, the Second Circuit affirmed the District Court’s ruling granting Defendant’s motion. Schumacher, et al. v. Inslee , 2021 U.S. Dist. LEXIS 50524 (W.D. Wash. March 17, 2021). A group of individual Providers ("IPs") who care for disabled or elderly individuals enrolled in Washington’s Medicaid- funded homecare program filed a class action seeking damages from union dues paid following the U.S. Supreme Court’s decision in Janus v. AFSCME, Council 31 , 138 S. Ct. 2448 (2018), which prohibited deduction of union fees unless "employees clearly and affirmatively consent.” Id . at *3. The class ultimately settled for $3,250,000. Plaintiffs’ action consisted of a proposed class of approximately 84 IPs who opted-out of the Court- approved settlement. Plaintiffs sought class certification pursuant to Rule 23 of all individuals who: (i) were Providers as defined in the complaint; (ii) from whom the State deducted union dues and/or dues-equivalent fees and remitted them to SEIU 775; (iii) who did not provide clear, prior affirmative consent for such deductions or union membership; (iv) who objected to union membership and the payment of any union dues/fees; and (v) who were subjected to the Defendants’ scheme outlined in the CBA. Id . at *3-4. Defendant argued that some members of the proposed class participated in Union activities, signed Union cards, and were current Union members. Defendant further asserted that Plaintiffs were not adequate class representatives and their counsel also failed to meet the adequacy of representation requirement of Rule 23. The Court agreed with Defendant. The Court determined that Plaintiffs and their counsel had pervasive conflicts of interest with members of the proposed class and therefore could not represent the class without serious risk of harm to absent members. Id . at *8-9. The Court noted that many members of the proposed class took actions showing Union support, even after opting-out of paying dues, as 19 signed Union membership cards after objecting to payroll deductions; 12