Key Points

  • The Seventh Circuit affirmed a permanent injunction barring Indiana from enforcing the additional union dues deduction requirements that Senate Enrolled Acts 251 and 297 impose only on public school teachers.
  • The court held that payroll dues deduction is a government subsidy but that Indiana's teacher-only conditions on it amount to viewpoint discrimination despite being neutral on their face.
  • Indiana's justification that the requirements prevent erroneous deductions failed because the state applied them to teachers alone, and the state never argued its interests were compelling, so the laws failed strict scrutiny.
  • The court rejected the unions' compelled-speech claim, holding that the revised statement on the dues authorization form is government speech that teachers are not required to adopt as their own.
  • Judge Lee wrote for a panel of Judges Sykes, Hamilton and Lee; the case was argued Jan. 10, 2024, and decided Nov. 2, 2026.

A federal appeals court on Monday upheld an order barring Indiana from making public school teachers renew their union dues authorizations every year and confirm them by email before the dues can come out of their paychecks. The court held that the state imposed those steps on teachers alone because of their unions' viewpoint, in violation of the First Amendment.

A three-judge panel of the U.S. Court of Appeals for the Seventh Circuit affirmed a permanent injunction that Judge Sarah Evans Barker of the Southern District of Indiana entered against the requirements. Judge Lee wrote the opinion for a panel that also included Judges Sykes and Hamilton. The case was argued on Jan. 10, 2024.

The decision means that, unless it shows the conditions are narrowly tailored to a compelling interest, Indiana may not attach extra conditions to automatic dues deductions solely because the employee is a teacher. The panel treated payroll deduction as a government subsidy, which a state may condition, but not along lines of viewpoint. The unions lost on one claim. The state-written rights notice that teachers must sign is government speech and does not force teachers to speak, the panel held.

Indiana's general wage-assignment law lets any employee, public or private, have union dues deducted from wages through a signed, revocable written request that the employer accepts in writing. A separate statute governs dues deductions for school employees, a category the court found covers only public school teachers, including charter school teachers.

In 2021 the legislature amended that statute in Senate Enrolled Act 251. Teachers seeking dues deductions had to sign a form bearing a 14-point boldface statement of their First Amendment right to refrain from joining or paying a union. They had to renew the authorization annually. Employers had to confirm each request by work email and send teachers a yearly notice of their right to quit the union.

Three teachers' unions and several members sued. Judge Barker first preliminarily enjoined the form's statement as compelled speech and rejected the unions' association claim. The legislature then passed Senate Enrolled Act 297, rewording the statement so that it reads as a message from the state. On summary judgment, Judge Barker ruled for the state on the speech claim and for the unions on the rest, holding that the extra requirements discriminated by viewpoint and failed strict scrutiny.

Indiana argued on appeal that a subsidy aimed at teachers as a group could not discriminate by viewpoint because teachers hold diverse and sometimes conflicting views. Judge Lee agreed that the laws were neutral on their face but wrote that even facially neutral restrictions can serve as a "facade for viewpoint-based discrimination," quoting the Supreme Court.

The state invoked Janus v. American Federation of State, County & Municipal Employees, the 2018 Supreme Court decision barring public-sector unions from charging fees to nonmembers. Judge Lee wrote that "the impacted teachers have already consented to join and subsidize a union; therefore, Janus has no relevance to the issues before us."

Indiana also said the added steps reduced the risk that employers would deduct dues from teachers who did not want to belong to a union. "But if this were the case, one would think that the State would impose additional hoops on all public employees rather than just teachers," Judge Lee wrote, quoting the Supreme Court's observation that underinclusiveness "raises serious doubts about whether the government is in fact pursuing the interest it invokes, rather than disfavoring a particular speaker or viewpoint."

The panel distinguished the Seventh Circuit's 2013 decision in Wisconsin Education Association Council v. Walker, which upheld a Wisconsin law allowing payroll dues deductions only for public safety employees. A separate opinion in that case, concurring in part and dissenting in part, argued that the distinction was viewpoint discrimination, the opinion notes. Indiana's laws, by contrast, Judge Lee wrote, "intentionally single out public school teachers while allowing other public employees to authorize automatic payroll deductions without additional barriers."

On the state's argument that teachers disagree among themselves, Judge Lee wrote that "the question is not whether teachers agree on everything, lock, stock, and barrel (they most assuredly do not)." The opinion continued: "It does not require any imagination to conclude that public school teachers and their unions share the overarching interest of promoting teacher salaries and benefits, work conditions, and public education writ large."

The state may choose whose speech to subsidize, the panel acknowledged, but "selectively conditioning access to that subsidy for public school teachers and their unions alone is indicative of viewpoint discrimination that the State has done nothing to rebut," Judge Lee wrote.

The laws failed strict scrutiny, the panel held, because Indiana defended them only as rationally related to preventing unwanted deductions and limiting liability. The state never argued that those interests were compelling or that it lacked less burdensome means. Absent that showing, Judge Lee wrote, "the State may not impose additional conditions to receive the benefit of automatic payroll deductions solely because the requesting employee is a teacher."

The panel rejected the unions' compelled-speech claim, which they had pressed as an alternative ground for affirmance. The revised statement originated with the state, which controls it, and a reasonable reader would see the state as the speaker, the panel held. "By its terms, it is an informatory statement, and it is the State of Indiana—not the teacher—that is doing the informing," Judge Lee wrote.

The panel affirmed the district court's judgment in full, leaving in place the permanent injunction against the state's enforcement of the two laws.