A coalition of New York health-care providers has filed suit in federal court urging the court to overturn the state's so-called labor neutrality law.

The health-care coalition argued that the law, which it dubbed "the Employer Gag Law," should be overturned on two grounds: It violates employers' free speech rights under the First Amendment to the U.S. Constitution; and it is preempted by the National Labor Relations Act (NLRA), the coalition is arguing.

The health-care coalition includes associations representing more than 550 non-profit and public hospitals, nursing homes, home care agencies, and other health care organizations throughout the state.

"This law not only interferes with an employer's right to freely express its opinions about unionization, but it also deprives the employees of the opportunity to hear their employer's views," said Michael Parker, executive director of Cerebral Palsy of New York State.

The Business Council also strongly opposes the law. The Council has argued that the law, which was conceived and promoted by powerful health-care unions, undermines free-speech rights and its preempted by the NLRA.

The Council maintains that the real intent of the law is to give unions a tool for harassing employers during organizing efforts. The law imposes onerous record-keeping requirements on any business or not-for-profit entity that does business with the state, gives state government new authority to demand those records, and subjects businesses and not-for-profits to the unfair burden of affirmatively proving that no state funds were spent to say anything about unions or the merits of organizing efforts.

In a Dec. 31 letter, The Council urged the National Labor Relations Board (NLRB) to seek an injunction preventing the law from being implemented.

The Council's letter noted that organized labor has asked state legislatures for such laws in California, New Jersey, and New York in an effort to "seek advantages Congress specifically intended to prevent in the National Labor Relations Act, and administrative interpretations historically made in creating a fair system for employee and employer decisions on workplace representations."

The law restricts the ability of employers to use public funds to hire or pay attorneys, consultants, or other contractors that encourage or discourage union organization, or participation in union drives, or to hire or pay the salary of employees whose principal job duties are to encourage or discourage union organization or participation in drives.

Employers that receive state funds can be required to prove that they did not spend any of the funds inappropriately, and must submit those records to any state entity and the state attorney general if asked to do so.

A federal district court in California last year ruled that the NLRA pre-empted a similar law in that state.