March 14, 1961 

Honorable David W. Ratliff, Chairman 

Labor and Management Relations Committee 8. 

Senate of the State of Texas 

Austin, Texas 

Opinfon No. WW- 1018 

Re: Whether the "agency shop" 

clause in labor union contracts contravenes Sec. 8a, 

Article 5154a;-Set, 2, Art. 

5207a; and Section 1, Art. 

5154g; V.A.T.C.S. 

Dear Senator Ratliff: 

The Senate Committee on Labor and Management Relations 

has requested an opinion as follows: 

"Does the 'agency shop! clause contravene 

exfsting statutes of the State of Texas by 

requiring that employees covered by the clause, 

who fail voluntarily to acquire or maintain 

membership in the union, as a condition of 

employment, pay to the union each month a 

service charge or fee as a contribution toward 

the administration of the agreement and the 

representation of such employees?' 

Your letter points out that many out-of-state companies 

have negotiated collective bargaining agreements with various 

unions containing "agency shop" clauses, which companies have 

branch plants in Texas, and that some Texas corporations are 

being pressed to sign contracts containing this clause, Your 

Committee is interested in this problem to see if corrective 

legislation is required, 

The standard "agency shop" clause I.73 a contract between 

the union and management, requires each employee who fails 

voluntarily to acquire and maintain membership in the union, 

as a condition of employment, to pay to,the union each month 

a service charge as a contributiontoward the administration 

of the contract and the representation of such employees. Such 

service charge is usually in.an amount equal to the union's 

regutar initiation fee'and a.month*s dues for,the first month 
Hon. David W. Ratliff, Page 2, (~~018) 

after the contract goes into effect, and for each month thereafter in an amount equal to the regular monthly dues. 

Section 8a of Article 5354a, Vernon's Civil Statutes, 

reads as follows: 

"It shall be unlawful for any labor 

union, 

agent, 

labor organizer, any officer, any 

or representative or any member of 

any labor union to collect, receive or demand, directly or indirectly, any fee, 

assessment, or sum of money whatsoever, as 

a work permit or as a condition for the 

privilege to work from any person not a 

member of the union; provided, however, this 

shall not prevent the collection of iniabove stated. ” (Emphasis 

5207a, Vernon's Civil Statutes, 

tiation fees as 

added). 

Section 2 of Article 

reads as follows: 

"No person 

ment on account 

membership in a 

Section 1 of Article 

reads as follows: 

shall be denied employof membership or nonlabor union." 

5154g, Vernon's Civ11 Statutes, 

I '!It 3:s hereby declared 30 be the public 

policy of the State of Texas that the right 

of Dersons to work shall not be denied or 

abridged on account of membership or nonmembership-in any labor union or labor organization and that in the exercise of such 

rights all persons shall be free from 

threats, force, intimidation or coercion." 

It is clear from a reading of the foregoing statutes that 

it was the intention of the Legislature to make membership or 

non-membership in a labor union a voluntary matter with each 

individual worker, and to protect him 3.n his right to continue 

to work at his job, regardless of his decision. 

Artfcle 5154a, V.C.S., 

Section 1 of 

reads in part as follows: 

"Because of the activities of labor 

unions affecting the economic conditions 

of the country and the State, entering as 

they do into practically every business 

and industrial enterprise, it is the sense 

of the Legislature that such organizations 
488% 

Hon. David W. Hatliff, Page 3, (WW- 101.8) 

affect the public interest and are charged 

with a public use. The working man, 

unionist, or non-unionist; must be protected. The right to work is the right 

to live. (Emphasis added). 

The Agency Shop Contract is of fairly recent origin. 

Heretofore, the three usual types of unjlon security have 

been: the Closed Shop; the Union Shop; and the Maintenance 

of Membership Arrangement. 

Under the Closed Shop contract the employer can hire only 

union members, and 11s forced to discharge employees failing 

to maintain their member*c‘hip in good standing in the union. 

Under the Union Shop contract the employer can hire without regard to union membership, but the'employee must become 

a union member within a specified time and thereafter maintain his membership in good standing. 

The Maintenance of Membership Arrangement allows the 

employer to hire wLthout regard to union membership or nonmembership, but during a specified limited time at the beginning of the contract or of being employed, as the case 

mLght be, every employee must decide whether or not he will 

join or remain a member of the union. Those who choose to 

join must remain members until the next so-called "escape 

period'* which occurs at the beginning of each contract renewal. 

However, those employees electing not to jo,in the union are 

free to remain as non-union employees for the life of the 

existing collective bargaining agreement. 

If it be argued that the Agency Contract does not require 

any person to become a member of a labor un$on as a prerequisite 

to obtaining or holding a job, then let it be noted that Sec. 8a 

of Article 5154a, supra , prohibits the coll&ction of any fee, 

assessment or sum of-money 'whatsoever as a condition for the 

privilege to w.ork from any person not a member of the union. 

Indiana, a right-to-work state, has held that the agency shop 

is lawful under its laws, but did so on the ground that the 

Indlana right-tozrk law is penal in nature, and must, therefore, be strictly construed. There being nothing in the Indiana 

statute which specifically prohibits the agency contract, the 

court held that under a strict construction of the penal law the 

agency shop contract could not be considered to be covered by the 

Indiana act by implication. Meade, E1ectri.c Co. v. Hagberg, 

159 N.E.2d 408 (Ind. App., 1959). 

While the Agency Shop Contract as a type of labor union con- 
Hon. David W. Ratliff, Page 4 (WW- 1018) 

tract was not in vogue at the time of the enactment of Article 

51fS4a, the Legislature certainly intended to cover this type 

of contract when it enacted Section 8a of Article 5154a, by 

whatever name it came to be called in later years. But aside 

from Article 5154a, the agency shop contract violates Section 2 

of Article 5207a and Section 1 of Article 5154g, since the required payment of the service charge is tantamount to compulsory 

membership in a labor union, and upon failure to pay the service 

charge, results in loss of the non-union worker’s job, if the 

contract is enforced. The payment of the service charge makes 

the non-union member subject to all of the pecuniary liabilities of the union member, without any corresponding privileges. 

He is, in effect, a disenfranchised union member against his 

will l 

In A. F, of L. v. Mann, 188 S.W.2d 276 (Civ. App., 1945) 

the Court was called on to construe Article 515&a. In construing Section 8a of Art. 5154a, the Court referred to closed 

shop contracts, and the arguments made by appellants that the 

fee charged against non-union workers was a part of the cost to 

such union in obtaining and maintaining union conditions and 

servicing the employees on the job. Indicative of the intent 

of the Court to apply Section 8a to more than the closed shop 

contract is the following language at page 285: 

1t 

. l . enforced collection by unions 

from non-union employees for such benefits 

as a right to-work is another matter, 

Carried to its logical conclusion, the 

same reasoning would justify such exactions 

on any job whereIn unions are involved, 

whether under closed-shop contracts or 

not; and ultimately could lead to the same 

policy toward all Labor, on the ground 

that all labor had benefited from union 

efforts. Thus the public interest is so 

affected by the practice prohibited in Sec. 

8% and the potential abuses and injustices 

to laborers who are not members of an organized union, whether from choice or inability to become so, that the Legislature 

was warranted in forbidding such practice. 

(Emphasis added). 

If any Texas statutes affecting labor do not apply in any 

given situation, it will be because the Congress has pre-empted 

the field with its own legislation with regard to the particular 

facts of the case. Certain acts and conduct, such as peaceful 

picketing of an employer’s place of business in an Industry af- 

! 
"There was evidence to be found in the 

acts of many States and of the Federal Congress to support the view that discrimination 

against employees because they did or did 

not belong to a union was against the public 

interest and should not be allowed. Laws 

merely regulating the union obviously would 

not accomplish that purpose. Basically, 

4885 

Hon. David W. Ratliff, Page 5 (~~-1018 ) 

fecting interstate commerce, has been held b the Supreme Court 

of Texas, in Ex Parte Twedell, 309 S.W.2d 83 % (x958), to lie 

outside the jurisdiction of our state courts. But membership 

in a union as ,a prerequisite to obtai'ning or holding a job is a 

different matte,r. Congress has made an exemption in favor of 

the states in the Labor Management Relations Act, 1947, in 

29 U.S.&A, Sec. 164 (b), which reads as follows: 

"Nothing in this subchapter shall 

be construed as authorizing the execution 

or application of a%greements requiring 

membership in a labor organization as a 

condition of employment in'any State or 

Territory in which such execution or application is prohibited by State or 

Territorial law." 

In Finney et al v, Hawkins, 54 S.E.2d 872, the Supreme 

Court of Appeals of Virglnfa was called upon to.construe Virginia's "Right-to-Work" law, Section 1 of which reads as follows: 

'It is hereby declared to be the public 

policy of Virginia that the right of persons 

to work shall not be denied or abridged on 

account of membership or non-membership in 

any labor union or labor organization.' 

The Virginia court stated in the Finney case at page 877: 

"As pointed out in the state court 

decisions in State v. Whitaker, (45 S.E.2d 860) 

. . l l > and Lincoln Federal Labor Union No, 

19129 v. Northwestern Iron & Metal Co., 149 

Neb. 507,31 N.W.2d 477, recent federal legislation makes clear that Congress did not intend 

to interfere with the right of States to prohibit agreements requiring membership in a 

labor organization as a condition of employment.... 29 U.S.C.A. Sec. 164 (b)." 

‘1 

l . . . 
Hon. David W. Ratliff, Page 6 ($0~1018 ) 

agreements involving such discrimination are hostile to our free 

enterprise system and to individual 

liberty of choice and action. Legislation that protects the citizen in 

his freedom to disagree and to decline 

an association which a majority would 

thrust upon him on the ground that it 

knows what is best for him, does no 

violence to the spirit of our fundamental law, The protection of minorities 

is the boast of our institutions and a 

basis of their asserted supetiiority 

over totalitarian regimes. The results 

have demonstrated the value of the 

democratic process." 

Shop" 

In response to your question, we hold that the "Agency 

clause in a contract between a labor union and management 

contravenes and is in violation of Section 8a of Article 5154a; 

Section 2 of Article 5207a; and Section 1 of Article 5154g 

of Vernon's Civil Statutes. 

SUMMARY 

The 'Agency Shop" clause in a contract 

between a labor union and management 

violates Sec. 8a, Art. 5154a; Sec. 2, 

Art. 5207a; and Sec. 1, Art. 5154g, 

V.C.S. 

Yours very truly, 

WILL WILSON 

Attorney General of Texas 

BY 

Assistant 

REF:rd 
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