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June 22, 2004

U.S. District Court schedules hearings on controversial 'labor neutrality' law

A United States District Court has scheduled oral arguments on a case challenging the legality of the state’s controversial “Labor Neutrality” law.

Neal P. McCurn, senior U.S. district judge, has also granted The Council amicus status in the proceedings, which are scheduled for August 18 in Syracuse. The Council had raised several arguments against the law in an amicus curia brief.

The Legislature passed the "neutrality" act in July 2002 with broad support in both parties, despite strong objections from The Council and groups representing hospitals, nursing homes, and other health-care providers.

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.

The law also says that any employer that receives state funds can be required to prove 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.

Ironically, the law does not require neutrality on the part of employees receiving state funds.

In its amicus curia brief submitted last November, The Business Council told the court that the Act is part of an attempt by unions to restrict employers' First Amendment rights and is preempted by the federal National Labor Relations Act.

“The central issue here is whether New York State can use its spending power to compel employers to remain neutral during a union organization campaign,” the brief said. “[We] submit that it cannot.”