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Federal Court Rules Illinois Strikebreaker Law Preempted by National Labor Relations Act

June 8, 2004 Practices

Labor Relations A federal court has ruled the Illinois Employment of Strikebreakers Act prohibiting employers from replacing striking or locked out employees with professional strikebreakers or temporary labor services is preempted by federal labor law.

The Illinois Employment of Strikebreakers Act was enacted in 2003 and made it unlawful for any employer knowingly to replace an employee whose work had ceased as a result of a lockout or strike with a professional strikebreaker. Later the same year, the law was amended to make it unlawful for an employer to contract with a day and temporary labor service to provide replacement workers for employees during a strike or lockout. A "day and temporary labor service" was broadly defined as any person or entity engaged in the business of employing day or temporary laborers to provide service to or for any third party employer."

The IESA subjects an employer enlisting the assistance of professional strikebreakers or day and temporary labor agencies to criminal penalties. Strongly supported by organized labor, the IESA essentially hamstrings employers in their efforts to hire replacement workers during a strike or lockout.

In May 2004, a federal court in Illinois sided with the employer in a lawsuit challenging the validity of the IESA. The court ruled that the IESA improperly intrudes upon the collective bargaining process and is therefore preempted by the National Labor Relations Act, the federal law that governs labor relations in the private sector. The court's decision nullifies the portions of the IESA that conflict with the NLRA.

Caterpillar Inc., a manufacturer of construction equipment that is currently in negotiations with the United Auto Workers for a successor collective bargaining agreement covering more than 7,000 of its employees, brought suit challenging the IESA and its recent amendments in the U.S. District Court in Peoria. Issuing a declaratory judgment that the NLRA preempts the IESA, the court noted that the federal law permits employers to bring economic pressure against unions by hiring temporary replacement workers during a lockout and permanent replacements during a strike. The court found that the IESA interfered with this employer right by "decisively shifting the balance of power in favor of labor to the detriment of management" and that "by depriving employers of an economic weapon of self-help, i.e., the hiring of professional strikebreakers and the use of third party day and temporary labor agencies," the IESA "upsets Congress' intended balance of power between labor and management." The court found that the IESA was unenforceable because it was an improper intrusion into the collective bargaining process regulated by the NLRA.

The court's decision could be appealed to the U. S. Court of Appeals for the Seventh Circuit in Chicago, but the Illinois Attorney General has not announced whether an appeal will be filed.

This decision is a significant and positive development for Illinois employers who are currently or soon to be involved in collective bargaining negotiations and faced with the possibility of a lockout or strike. The decision makes it easier for Illinois employers to weather the storm of a strike or lockout by preserving their right to recruit and hire replacement workers from the ranks of professional strike replacements, and day and temporary labor services. Caterpillar v. Lyons, No. 03-1245 (C.D. Ill. May 14, 2004)

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