The Michigan Supreme Court ruled Wednesday, in a 4-3 decision, that the state's new right-to-work law extends to state employees.
The United Auto Workers union had sought to overturn the law, which says that workers cannot be forced to join or otherwise financially support a union.
The ruling means that the state's estimated 35,000 public employees can opt out of paying union dues, a right they previously did not have. Organized labor in the Wolverine State is likely to take a major financial hit as workers opt out of membership.
The union and its allies argued that the state's constitution prohibited applying the law to public employees. Therefore, the Michigan Employee Relations Commission, the agency that oversees civil servants, could still compel the workers to give part of their paychecks to public employee unions. The court rejected that, stating that the commission would in effect be taxing the workers and it didn't have that authority.
"Although the commission had authority over civil service employees' rates of compensation, conditions of employment, and grievance procedures ... the commission's power to regulate the conditions of employment through public collective bargaining agreements did not encompass the specific authority to tax or appropriate," the majority said.
Michigan unions argue that right-to-work, first adopted by the state in 2013, creates an unfair "free rider" problem for them since workers who opt of paying dues are nevertheless still represented by them in collective bargaining. Labor leaders have fought aggressively against the law, but several legal attempts to undo it have failed to make a dent. The United Auto Workers had not issued a statement on the ruling.
Conservative groups cheered the court's decision.
"This was an attempt by the UAW to take away the rights of certain workers and force union payments from them, going directly against Michigan law," said Patrick Wright, vice president for legal affairs at the Mackinac Center. "The majority correctly noted that state employees unions have illegally been receiving agency fees from state employees for decades."