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The value of a good or a service is a relative measure. That’s why “one man’s trash is another man’s treasure.” It’s why people troll eBay and Craigslist for used goods. It’s why the IRS reviews the declared value of in-kind donations.
So who - other than the IRS - decides whether a thing has value?
This week, the answer is the Eleventh Circuit Court of Appeals, which ruled on Wednesday that organizing assistance can be a thing of value under the Labor Management Relations Act (LMRA).
In the case, Mulhall v. Unite Here Local 355, Mardi Gras Gaming entered into a memorandum of agreement with Unite Here Local 355 to provide Unite's union representatives access to non-public work premises to organize employees during non-work hours, provide relevant information about Mardi Gras employees for unionization, and to remain neutral in the unionization of its employees. In return, Unite promised to lend financial support to a ballot initiative regarding casino gaming. (Unite later spent more than $100,000 campaigning for the ballot initiative.)
Michael Mulhall, a Mardi Gras employee who opposes unionization, sued to enjoin the agreement because it violated §302 of the LMRA, which limits exchanges between unions and employers by making it unlawful for an employer to give, or for a union to receive, any thing of value, (with limited exceptions). As the Ninth Circuit noted in Turner v. Local Union No. 302, the purpose of the prohibition is to "prevent employers from tampering with the loyalty of union officials and to prevent union officials from extorting tribute from employers."
Here, the Eleventh Circuit Court of Appeals decided that the union organization assistance that Mardi Gras agreed to provide can be a thing of value.
While the ruling was a departure from Third and Fourth Circuit decisions that organization assistance under similar agreements did not violate §302, the Eleventh Circuit reasoned, "Whether something qualifies as a payment depends not on whether it is tangible or has monetary value, but on whether its performance fulfills an obligation. If employers offer organizing assistance with the intention of improperly influencing a union, then the policy concerns in §302 -- curbing bribery and extortion -- are implicated."
It's important to note that the Eleventh Circuit Court of Appeals did not definitively rule that the organizational assistance in this case is a thing of value; that matter is left to the trial court. Instead, the Eleventh Circuit found that Mulhall had stated a claim for relief, and remanded the case so that the district court could consider the LMRA §302 claim and determine the reason why Unite and Mardi Gras agreed to cooperate with one another.
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