CLIENT UPDATE

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September 14, 2011

Federal District Court Rules New York’s “Union Neutrality” Law Preempted by Federal Law

On September 7, 2011, a federal court judge in the Northern District of New York ruled that New York’s “Union Neutrality Law,” Labor Law Section 211-a, is preempted by the National Labor Relations Act (“NLRA”).  Healthcare Association of New York State v. Cuomo, 03-CV-00413 (Sept. 7, 2011).  The Court enjoined the State of New York from implementing or enforcing the law. 

The Union Neutrality Law prohibits employers from using funds provided by the State of New York for the following purposes:

  • Training of managers, supervisors or other administrative personnel regarding methods to encourage or discourage union organization;
  • Hiring or payment of attorneys, consultants, or other contractors to encourage or discourage union organization; and
  • Hiring of employees or payment of salary or other compensation of employees whose principal job duties are to encourage or discourage union organization.

 

The Law also imposes record-keeping requirements on employers that receive funds from the state and wish to engage in such activities.  Violators of the Law are subject to fines and penalties. 

The Court ruled that the State was precluded from enacting the spending regulations because the NLRA’s regulation of labor activity was intended to bar any state laws dealing with the same subject matter.  In reaching its decision, the court relied heavily upon a 2008 Supreme Court decision that invalidated a similar California state law.  Chamber of Commerce v. Brown, 554 U.S. 60 (2008). 

It is likely that the Court’s decision will be appealed.  We will keep you apprised of any developments.  Please do not hesitate to contact us should you have any question on this decision.