Skip to Main Content

Keeping you informed

Supreme Court Throws out State Law Prohibiting Grantees from Using Funds for Labor Matters

    Client Alerts
  • June 27, 2008

In 2000, the California state legislature enacted a law that prohibits any recipient of state grant money exceeding $10,000 from using the funds “to assist, promote, or deter union organizing.”  Last week, the U.S. Supreme Court invalidated the law, finding that federal labor laws preempt California’s attempt to restrict employer opposition of union organizing.

The decision in Chamber of Commerce of the U.S. v. Brown hinged on the Court’s interpretation of the National Labor Relations Act as it applies to regulation of employer speech during union organizing campaigns.  The Court held 7-2 that the California law interfered with the NLRA’s structure for regulating organizing campaigns.  Federal law already prohibits employers from coercing employees or engaging in other unfair labor practices.  The fact that state funds may be used does not alter employers’ ability under the NLRA to engage in non-coercive speech.