It appears that a number of labor unions are planning for the potential negative impact of a big decision regarding fair share fees.  We have heard from several public sector clients who have been contacted directly, or who have had employees contacted, by labor unions about the potential impact of Janus v. AFSCME Council 31, which is currently pending before the United States Supreme Court.  The case, which could ultimately declare fair share fees unlawful, is expected to be released before the end of June of 2018.

Based on what we have read from these unions, they seem to believe that there is a good chance that the Supreme Court will declare fair share fees unconstitutional.

As a reminder, fair share fees are fees that are required to be paid by bargaining unit employees who elect not to be full-fledged union members.  By operation of state law, employees who are in the bargaining unit but who elect not to be union members are forced to pay “fair share” fees in many states, including Pennsylvania.  These fees are often a large percentage of the actual cost of union membership.

Public sector employees have raised multiple challenges to the constitutionality of fair share fees.  Specifically, a number of public sector employees have alleged that such fees violate employee First Amendment Rights.  We wrote about one such challenge here.  That decision, Harris v. Quinn, was highly critical of fair share fees, and the underlying justification for requiring fair share fees.  Harris closely examined the precedent that initially determined that such fees were lawful, which concluded the goals of limiting or eliminating “free riding” and the promotion of labor peace overrode any impact on employee First Amendment rights.

While it was highly critical of these stated goals, the Harris Court came just short of declaring all fair share fees unconstitutional.  A subsequent challenge to fair share fees that also reached the Supreme Court case also fell short of declaring the fees unlawful.

Enter Janus.  Janus is a public employee and member of a bargaining unit, but not a member of the union.  He has been forced to pay fair share fees for some time. Janus has argued that the union engages in certain activities that he does not support, and that the union uses his fair share fees to engage in such conduct.  Essentially, he does not support any of the union’s activities, and he believes it is unfair that he is forced to pay them to engage in such activities.  Janus wants to be able to opt out of paying any fees to the union.  Janus argues that forced fair share payments to a union he does not support is “compelled speech” in violation of his First Amendment rights.

Janus is currently pending before SCOTUS, and many believe that the Court finally has the votes to declare fair share fees unconstitutional.  Based on what we have seen, it appears that at least some labor unions agree.

Some observers believe that the elimination of fair share fees will significantly weaken the political clout of public sector labor unions.  We should soon know the fate of fair share fees generally, as the Janus decision is expected in the near future.  However, if fair share fees are declared unconstitutional, only time will tell what impact, if any, the elimination of fair share fees would have on public sector labor unions.

Stay tuned, we will keep you posted.

Yesterday, we reported on a Commonwealth Court decision that basically concluded that an arbitrator’s award ordering the reinstatement of a discharged employee who is incapable of performing his job violates the “essence test.” We also noted that a subsequent decision of the court seems to be a bit in conflict with that holding. Let’s take a closer look at that decision.

The Commonwealth Court addressed (what appeared to be) a similar question in the context of a state trooper. The Trooper, a male, had a romantic relationship with a female, which ultimately failed. Thereafter, the female Trooper filed complaints that alleged the male Trooper was harassing her. The Pennsylvania State Police conducted an investigation and found the complaints unsubstantiated. Alleging the same behavior, the female Trooper filed for a Protection of Abuse order (PFA). A judge ultimately issued the PFA, which had a condition that the male Trooper could not carry a firearm. Because he could not carry a firearm, the male Trooper was placed on restrictive duty pending an additional internal investigation. Upon confirming that the PFA included a condition that barred him from carrying a firearm, the State Police terminated the male Trooper.

The Trooper filed a grievance and ultimately submitted the issue to arbitration. The arbitrator ordered that the Trooper be reinstated. The State Police appealed to the Commonwealth Court. Same result as the correctional officer, right? He cannot perform the essential duties of his position, so requiring his employment infringes managerial rights? Nope.

There are two key differences. First, unlike the correctional officer, whose collective bargaining rights are set out in the Public Employee Relations Act (PERA), the state trooper’s collective bargaining rights are established under Act 111. In reviewing arbitration awards under PERA the court uses the highly deferential essence test. However, in reviewing arbitration awards under Act 111, the court uses an even more deferential and narrow test. It is indeed narrow, justifying a vacation of an arbitrator’s award only if there is a lack of jurisdiction, irregularity of proceedings, excess in the exercise of powers, or deprivation of constitutional rights. The State Police argued that the Trooper’s reinstatement was in excess of the arbitrator’s powers. The court disagreed, finding that there is only an excess use of powers if the award requires an illegal act or performance of an act which cannot be done voluntarily. No such excess was present here.

The second difference is more fundamental: unlike the correctional officer, the State Police’s justification for the Trooper’s termination was not his inability to perform the essential functions of a police officer (carry a firearm), but it was the harassing conduct underlying the issuance of the PFA. According to the State Police, the underlying conduct violated department regulations for “unbecoming conduct” and “conformance of laws.” However, those regulations required physical abuse, commission of a felony or misdemeanor, or use of a firearm. None of the harassing conduct underlying the PFA involved any of this type of conduct. Thus, the court found the arbitrator did not exceed his authority in concluding that there was not just cause for the Trooper’s termination.

So, for our public employer subscribers, these cases serve as a reminder that arbitrator decisions are subject to great deference on appeal, making success during arbitration of critical importance. But more importantly, it makes clear that if you are planning on terminating an employee who has established that he or she is unable to perform the essential duties of his or her position, that must be the documented basis (or at least part) for the termination.

In November 2017, the Commonwealth Court of Pennsylvania issued an opinion concerning an arbitrator’s reinstatement of a state correctional officer (“CO”). The CO was responsible for monitoring inmates who worked on the prison’s loading dock. As far back as 2015, the CO’s supervisors noticed unauthorized food items in the dock area. Despite instruction to remove all unauthorized food from the dock, the CO continued to allow inmates to remove food from deliveries, and he personally took food for himself. Finding that he violated several orders, the CO was temporarily removed from his position and later reinstated. Shortly after his reinstatement, a routine search of the dock again found contraband food. This time he was discharged.

The CO filed a grievance and later submitted the issue to arbitration, claiming that the Department of Corrections violated the collective bargaining agreement by discharging him without just cause. The arbitrator agreed and reinstated the CO with a 30-day suspension. The arbitrator found that the CO was not irredeemable, just that “he should not be in a position which requires his supervision of inmates.” The arbitrator noted that the CO must have agreed with his inability to supervise inmates because he applied for, and was granted, a transfer to a guard tower position prior to his termination. Thus, the arbitrator found there was just cause to discipline the CO, but termination was not warranted.

The Department appealed the arbitrator’s award to the Commonwealth Court. The Court reviewed the award using the well-established “essence test,” which is a highly deferential standard. The essence test requires the court to affirm an arbitrator’s award so long as it can be rationally derived from the collective bargaining agreement. The Department argued that the award was not rationally derived from the CBA. It asserted that the award required it to employ a CO who could not perform the functions of the job, i.e. the care, custody and control of inmates. The Commonwealth Court agreed.

The court held that since the arbitrator found that the CO should not be in a position which requires supervision of inmates, the CO could not perform the statutorily-defined duties of a correctional officer. Thus, reinstatement would force the Department to employ an officer with limitations on his ability to interact with inmates. The court found this was in direct contradiction to the managerial rights enumerated in the CBA, which provided the Department had authority to direct its workforce to satisfy its operational needs. Accordingly, the court found arbitrator’s award was not rationally derived from the CBA.

For many public employers in Pennsylvania, the court’s decision is a welcomed limitation on the seemingly limitless power of arbitrators. It just makes sense that an arbitrator should not be permitted to reinstate an employee who the arbitrator himself has determined is incapable of performing his job.

However, a subsequent decision of the Commonwealth Court, analyzing a similar issue, has left some public employers scratching their heads. We will cover the subsequent decision in a post tomorrow.

In City of Allentown, the Pennsylvania Supreme Court ordered the City to implement an interest arbitration award which contained (among modifications to wages, sick leave, vacation, pension and overtime) a minimum staffing requirement of 25 firefighters per shift.

As every public sector employer and practitioner knows, a municipality has no obligation to bargain with a union representing police officers or firefighters over inherent managerial policy (overall budget, standards of service, organizational structure, selection and direction of employees).  I mean, it says so, right there in the Pennsylvania Labor Relations Act!  The PLRA is forever linked to Act 111, which makes it mandatory for municipalities to bargain with police and fire unions over the terms and conditions of employment (compensation, hours, working conditions, other benefits).

Act 111 also provides the mechanism for municipalities and unions to submit their disputes to binding interest arbitration, but only those disputes which concern mandatory subjects of bargaining.  An arbitration panel that issues an award on a topic that is a managerial prerogative exceeds its powers.

But, what happens when a dispute concerns both a mandatory subject (i.e. it is rationally related to the terms and conditions of employment) and a managerial policy (i.e., budget or direction of personnel)?  Well, then the question is whether bargaining with the union over the issue would unduly infringe on the municipality’s essential managerial responsibilities.  That is the analysis that the Supreme Court applied to the minimum staffing dispute facing the City of Allentown and the International Association of Fire Fighters Local 302.

Prior case law left us with this:  the total number of firefighters that a municipality employs is a matter of managerial prerogative and a municipality need not bargain over that number.  An arbitration award that mandates a total complement number is illegal.  Prior case law also left us with this:  the number of firefighters actually assigned to a particular station or to a piece of fire equipment is a mandatory subject of bargaining, as it is rationally related to the safety of firefighters, i.e. a working condition.  So, an arbitration award that mandates the minimum crew on each rig is perfectly legal.

Confused?  Citing safety concerns and relying heavily on arbitration testimony that increased staffing leads to a safer working environment and a decrease in injuries and physical stress, the Court concluded that minimum staffing had a “direct and significant impact on firefighter health and safety” and did not unduly infringe on the City’s financial burdens.

More directly, the Court (currently comprised of 1 elected Republican, 5 elected Democrats and 1 Republican appointed by a Democrat Governor) did little more than pay lip service to how minimum staffing leads to increased overtime, or how increased overtime leads to increased pension expenses, or how increased pension expenses lead to unfunded pension liabilities, or how unfunded pension liabilities are crippling so many municipalities across the Commonwealth.

So what now? It appears that the overall complement is still a decision left for the public employer; however, once that number is set, then the parties must negotiate regarding the number of employees assigned to each shift.  Certainly, this leaves many questions unanswered.  And certainly, the impact on municipal budgets, already strained and struggling, will be significant.

As if Counties could forget that Court employees are just a little different, the Commonwealth Court of Pennsylvania sent us another reminder when the Court held that the Pennsylvania Whistleblower Law does not apply to judicial employees.

Gregory Thomas was a Juvenile Probation Officer serving with the Washington County Court of Common Pleas until October 2014, at which time he was allegedly forced to quit. Prior to his resignation, Thomas had been a participant in an investigation regarding the misappropriation of funds by the Juvenile Probation Office. During the investigation, it was revealed that the Chief of the Juvenile Probation Office had directed Thomas to email the County’s purchasing office in July 2014 to state that a mixed martial arts training session had taken place on June 6 and 7 in partial satisfaction of the state’s 40-hour annual training requirement. The email sought, and was granted, funding for the training. No such training actually occurred, and Thomas confirmed to the investigating detectives that he had not attended this training; he alleges that he had been told by the Chief Probation Officer to tell the detectives otherwise.

The day after his interview with the detectives, Thomas was notified that he needed to resign or he would be fired for reasons not related to the investigation. Thomas brought suit against the County, Court Administration, and others alleging that he reported wrongdoing and misappropriation of funds when he spoke to the detectives, and therefore his forced resignation violated the Pennsylvania Whistleblower Law. The Defendants contended that the Whistleblower Law did not apply to judicial employees because doing so would violate the separation of powers doctrine. The trial Court granted the Defendants’ Preliminary Objections and entered judgment in their favor, finding that judicial employees are not subject to the Whistleblower Law.

In reviewing the case, the Commonwealth Court noted that the statute itself does not reference the Judiciary in the definition of “employer” or “public body,” and that prior case law established that the Legislature did not intend to include the Judiciary therein or it would violate their constitutional authority to hire, fire and supervise their employees. As such, the only way that the statute could apply was if the Court voluntarily waived sovereign immunity. Although Thomas argued that the Court had done so because the Code of Conduct for Judicial employees issued by the Administrative Offices of the Pennsylvania Courts specifically referenced the Pennsylvania Whistleblower Law, the Court disagreed that “the mere description of the Whistleblower Law in a Note…demonstrates the Court’s intent to bring the Judiciary under the scope of that Law.”

In particular, the Court noted that the reference to the Whistleblower Law was found in that section of the Code of Conduct related to the Duty to Report, which requires employees to report to their immediate supervisor any attempt to induce them to violate the Code of Conduct, and that the reference was a mere description of the Law. Nothing in the reference specifically states that the Law is applicable to the Judiciary, or otherwise indicates the Court’s intent to make the Law applicable. The Commonwealth Court stated that, considering the “vigilance” and “care” that the Court takes to protect its independence and the separation of powers, more than a general description of a legislative enactment would be required to demonstrate an intent to make the Law applicable to it. Because the Law did not apply to the Courts, the Preliminary Objections were properly sustained and judgement entered for the Defendants.

The Thomas v. Grimm case should serve as a reminder that there are special considerations when dealing with HR issues involving Court employees – and the rules for hiring, firing and supervision may be slightly different. A good County HR Department must be careful, therefore, not to overstate the rights and protections of Court employees while also advocating for the County’s position on an employment decision and respecting the separate role of the Courts. Aside from the specific reminder about the unique Court-County relationship, Thomas should also serve as a reminder to all public sector employers of the unique position they and their employees are in when it comes to the employment relationship, where they must be careful to navigate their role as a public service entity providing statutory and constitutional resources to its constituents while also respecting the constitutional and other legal rights of employees.

Public employers in Pennsylvania beware: if you implement an attendance policy designed to get your employees to show up for work, you may commit an unfair labor practice!  If your employees are represented by a labor union, and your policy outlines disciplinary action, then you must bargain with the appropriate union before issuing discipline under the policy.  The employer in Chester Upland Sch. Dist. v. Pa. Labor Relations Bd., learned that the hard way.

In that case, the public school district unilaterally adopted a new attendance and punctuality policy.  The new policy applied progressive discipline to employees who reached a certain number of absences due to personal illness.  The updated policy was adopted shortly after the expiration of a collective bargaining agreement between the district and its employees.

Upon learning of the change, the employees’ union filed an unfair labor practice charge, arguing that the district committed an unfair labor practice by adopting the policy without engaging in collective bargaining.  The union pointed to the prior collective bargaining agreement’s sick leave provisions, which provided each employee with eleven sick days per school year and was silent on discipline.  The district countered that the updated policy did not impose a new source of discipline; employees were always subject to discipline for attendance violations.  Rather, according to the employer, the new policy simply advised employees as to how attendance issues were tracked for disciplinary purposes.

The Pennsylvania Labor Relations Board rejected the employer’s arguments, finding that the district committed an unfair labor practice by unilaterally changing the terms and conditions of employment through adopting the new attendance policy.  The district appealed to the Commonwealth Court, which upheld the Board’s determination.  The Court provided several reasons for doing so.

First, it recognized the PLRB’s long history of treating sick leave policies as mandatory subjects of collective bargaining.  Second, the Commonwealth Court held that new policy did not simply explain how the district tracked absences for disciplinary purposes; instead, it specifically imposed progressive discipline for using sick days.  An employer’s unilateral changing of terms and conditions of employment, explained the Court, is an unfair labor practice regardless of whether it happens during the term of a CBA, following the expiration of a CBA or during the course of negotiations.  Moreover, the new policy directly conflicted with the express terms of the collective bargaining agreement, which did not provide for disciplinary action.

This case serves as an important reminder to public employers in Pennsylvania that when adopting new policies, a careful examination of the appropriate collective bargaining agreements is required.  Before implementing new rules that can result in disciplinary action, negotiation is typically required.  Adopting new disciplinary rules without engaging in collective bargaining will not withstand the scrutiny of the PLRB or Pennsylvania courts.

For government employers, disciplining and terminating employees can be especially difficult. Not only does the public employer face the same challenges in complying with the standard alphabet soup of employment laws that private employers do, including the ADA, ADEA, FMLA, Title VII, etc., they also have the complicated task of considering the application of an employee’s Constitutional rights in making employment decisions. Unfortunately, the protections provided by the constitution to government employees don’t rely on the kinds of “immutable” traits often in issue in the alphabet soup context, which means that determining when constitutional rights could be violated is particularly troublesome.

Recently, in Heffernan v. City of Paterson, the United States Supreme Court brought the analysis applicable to First Amendment retaliation claims closer to your typical alphabet soup case in one small way – focusing on the employer’s intent. In a typical discrimination context, the employer’s intent is key when examining the reason given for the action and the circumstantial evidence that may call that stated reason into question. In short, the question is: was it the employer’s intent to discriminate in disciplining an employee, or was it really the employee’s violation of an employer policy?

In the First Amendment context, employer intent is usually irrelevant or assumed; the focus instead is on whether the speech or activity is personal or on a matter of public interest, whether the employee acted as a citizen or an employee, and how the speech or activity could harm the government’s interests. Heffernan, however, presented the unique situation where the employee contended he didn’t intend to speak or act at all, but the employer punished him for its perception that he had. The Court therefore faced the following question: whose intent is more significant in the constitutional rights context? The Heffernan Court found that it is the employer’s intentions that are critical to determining whether there has been a violation of the employee’s rights.

In reaching this decision, the Court considered the following facts: Jeffrey Heffernan was employed as a police officer for the City of Paterson in 2005 under Chief of Police James Wittig. Both the Chief and Heffernan’s direct supervisor had  been appointed to their positions by the Mayor, who was running for reelection. During the campaign, Heffernan’s colleagues spotted him at campaign headquarters talking with campaign workers and holding a campaign sign for the Mayor’s opponent, who was a known friend of Heffernan. When word reached his supervisors, Heffernan was demoted from a detective position to a patrol officer position, and given an undesirable patrol post, allegedly to punish his involvement in the opposition’s campaign.  Heffernan denied being involved in the campaign, and denied supporting the candidate, stating that he was only picking the sign up for his mother, who was bedridden and could not do it for herself.

In response to his demotion, Heffernan filed a lawsuit against the City contending that he had been demoted because the City believed he engaged in conduct that constituted protected activity, even though he denied that he had intended to speak or act.

Prior case law is very clear that government employers are prohibited from making an employment decision because an employee supports a particular political candidate. However, Heffernan was contending that he didn’t actually support the oppositional candidate, but the City mistakenly believed he did. The City’s position in the litigation was that, since he hadn’t intended to engage in protected activity, his activity wasn’t protected…and its demotion decision could therefore only violate his rights if in fact he actively supported the candidate.

Ultimately, the Court concluded that “the government’s reason for demoting Heffernan is what counts…When an employer demotes an employee out of a desire to prevent the employee from engaging in political activity that the First Amendment protects (even if the employee did not intend to engage in that activity), the employee is entitled to challenge that unlawful action under the First Amendment…” Whether the employer has correctly or incorrectly deduced the employee’s motives in engaging in particular behavior, the Court opined that the same constitutional harm would result – an employee would be demoted or terminated for appearing to engage in protected activity, thereby discouraging other employees from engaging in what should be protected activity. Because the harm would result regardless of the accuracy of the employer’s belief, the employer’s reason for the employment action must govern in determining if a First Amendment cause of action and violation exists.

Unfortunately for Heffernan, his fight with the City will continue on, as the Supreme Court did not reach the ultimate question of whether his rights had been violated. To the contrary, the Court’s decision remanded the case back to the trial court to determine whether or not Heffernan’s demotion occurred pursuant to an existing neutral policy prohibiting police officers from overt involvement in any political campaign, and whether such a policy complies with constitutional standards generally.

The immediate take-away for government employers and elected officials (and the HR personnel who love them), in light of the Heffernan decision should be on the reinforcement of what we know already from other employment discrimination cases: we must examine the reason for an employment decision before it is made to ensure there is  no protected classification or protected activity motivating the decision. Even if the employer is  wrong about what the employee intended by his actions, a decision motivated by an intent to punish what would otherwise be protected activity could violate the constitution.

Recently, the Pennsylvania Labor Relations Board (PLRB) issued a Final Order indicating that members of a volunteer fire company which provided coverage to a local borough were actually Borough employees.   In doing so, both the hearing examiner who issued the Proposed Decision and Order and the Board determined that it did not matter that the firefighters were “appointed” and not “hired” by the borough, and further opined that the relationship of providing services for wages was an element of an employer-employee relationship.

The fire department was a non-profit corporation, with its building and most of its equipment and apparatus owned by the Borough.  In 1999, the Borough’s council adopted an ordinance establishing a fire department and officer ranks, providing for vehicles and equipment, and reserving the right for council to establish binding rules, regulations and Standard Operating Procedures (SOPs).  The ordinance further indicated that the Borough Council would appoint the officers, require the officers to take the same oath that was required for Borough officials, and allowed the Fire Chief (an employee of the Borough) to issue orders and an SOP manual.

In its review, the Board found that the Borough’s 2012 and 2013 budgets contained a number of line items for the Fire Department (and later included a fire services tax), and further noted that when an expense was incurred, it was paid directly by the Borough.  Significantly, volunteers were paid an hourly rate by the Borough, which had the power to set and approve the hourly rates plus incentives for further training.  The Board further noted that the Secretary of the Borough ran the day-to-day operations of the department (including scheduling), that the Borough had to authorize any overtime, and that the firefighters submitted time cards and received W-2s from the Borough.  Additionally, personnel matters, including disciplinary action, were handled by the Fire Chief.  Challenged disciplinary matters could be taken to the Borough Manager.

FIREFIGHTER HELMET-BlankBased upon the above information, the hearing examiner determined that the officers were actually employees and not volunteers.  The Borough did not challenge the findings that it controlled the wages, hours, or working conditions of the firefighters- all considered to be evidence of an employer-employee relationship- but did file exceptions on the basis of the hearing examiner’s finding regarding discipline.  Upon review, the Board found that because the Fire Chief, as an employee of the Borough, acted in the interest of his employer, the Borough “exercised control over disciplinary matters.”  The Borough made several other arguments, including that the hearing examiner’s findings would mean that the Borough was in violation of civil service and veterans preference laws.  However, the Board ultimately found no error in the examiner’s ruling and made the order final.

The order has been appealed to the Commonwealth Court, with support from both the Pennsylvania State Association of Township Supervisors and the Pennsylvania State Association of Boroughs.  If the Court agrees with the PLRB, this will have a huge impact on municipalities which rely on the services of volunteer fire companies but may not have the financial ability to absorb these volunteers and the costs that come along with them being declared employees of the municipalities.  This is definitely one to watch.

Yeah, I know, crazy right? Here is the story. Apparently the Union did not think so. When the American Federation of State, County and Municipal Employees ("Union") and the City of Philadelphia ("City") could not reach terms on a new collective bargaining agreement, they submitted the dispute to binding interest arbitration.

The Union was seeking, among other things, 8 percent annual wage increases! The City countered that it simply did not have the money to fund the Union’s demands. The Union argued that the City’s financial health was irrelevant. Huh? How can you pay for something if you don’t have any money?

The Union’s argument was essentially – cut programs, raise taxes, lay off other workers we don’t care; how you pay for our 8 percent annual pay increases is your problem not ours! Insane, right?

Thankfully, the arbitration panel rejected the Union’s argument and determined that it was appropriate to consider the City’s ability to pay. However, the Union was undeterred. The Union petitioned the court to vacate the arbitration decision, arguing that the panel should not have considered the financial health of the City when rejecting their hefty wage increases. Thankfully, the court disagreed.

The court concluded that the Union’s arguments lacked merit, and that it was appropriate for the arbitration panel to consider ability to pay when making decisions regarding wages and other compensation related items.

Thankfully, the arbitration panel and the court brought some sanity to what seemed like an insane dispute. Ability to pay is obviously highly relevant to consideration of pay and benefit demands. Public employers are facing increasing budget constraints these days and are often on the brink of distressed status. When evaluating union demands, public employers must consider their ability to pay and when appropriate explain to the union early and often that the budget simply cannot tolerate increased expenses. Where appropriate, lay the foundation for demonstrating the financial inability to meet the union’s demands.

This post was contributed by Gina E. McAndrew, an Associate in McNees Wallace & Nurick LLC’s Labor & Employment Practice Group in Scranton, Pennsylvania.

While the labor and employment law world is abuzz after the decisions in Burwell v. Hobby Lobby and Harris v. Quinn (cases this Blog will cover in the coming days), the United States Supreme Court also issued a decision further clarifying protected speech under the First Amendment. In Lane v. Franks, et al., the Court analyzed whether a public employee, testifying under subpoena, was entitled to First Amendment protection when his testimony was outside of the scope of his job duties.

The employee, Edward Lane, was hired by Central Alabama Community College as Director of Community Intensive Training for Youth ("CITY"), a statewide program in Alabama for underprivileged youth. Shortly after his employment began he conducted an audit of CITY’s expenses. The audit led to the termination of an Alabama State Representative, who was on CITY’s payroll. Following the termination decision, Lane provided testimony against the Representative in support of an FBI investigation of the Representative. Shortly after his testimony, twenty-nine CITY employees were laid off, including Mr. Lane. While twenty-seven of these terminations were rescinded, Mr. Lane’s was not.

Lane filed suit, claiming he was terminated in retaliation for providing testimony against the Representative. The District Court found that his testimony was not protected by the First Amendment. The District Court stated that public employees speaking pursuant to official job duties were "not speaking as citizens for First Amendment purposes." The District Court opined that Lane learned of the information included in his testimony while an employee of CITY, so his "speech [could] still be considered as part of his official job duties." Lane appealed, first to the 11th Circuit Court of Appeals and then to the United States Supreme Court.

In overturning the lower courts’ decisions, the Supreme Court restated the special test applied to public employees for First Amendment protection purposes. The first part of this analysis examines whether the speech in question was made pursuant to official duties or as a citizen and whether the employee was speaking on a matter of public concern. If the employee is speaking as a citizen and on a matter of public concern, the second part of the test is whether the public employer has "adequate justification for treating the employee differently from any other member of the general public."

The Court noted that "[t]ruthful testimony under oath by a public employee outside the scope of his ordinary job duties is speech as a citizen for First Amendment purposes," even when that speech "relates to his public employment or concerns information learned during that employment." The Court noted that such testimony is a "quintessential example of speech as a citizen," as it comes with the obligation to tell the truth. This obligation is separate and distinct from any obligations a public employee may have to his employer.

The Court opined that the essential question is whether the relevant speech is "ordinarily within the scope of an employee’s duties" and "not whether it merely concerns those duties." In its analysis, the Court found that such public employee speech holds special value because of how public employees gain knowledge, and is "necessary to prosecute corruption by public officials." The Court ultimately found Lane’s sworn testimony, pursuant to a subpoena, to be speech as a citizen and on a matter of public concern. In applying the second step of the analysis, the Court found that the employer had no legitimate interest in treating Lane differently from any other member of the public, finding that his testimony did not involve any false statements or disclose any privileged or confidential information.

The Court’s decision provides useful guidance to public employers in the area of First Amendment protection for public employees. However, future decisions will likely shed light onto when speech is "ordinarily within the scope of an employee’s duties" sufficient to warrant First Amendment protection. Many employees, especially public employees, provide testimony on a regular basis pursuant to official job duties. Accordingly, while Lane is helpful, First Amendment issues must still be evaluated on a case-by-case basis.