In a case that could cause chaos for teacher unions and other public employee unions, the Supreme Court heard arguments this week from a handful of California teachers who say they should not be required to pay for services provided by unions they haven't joined.

Under federal law, schoolteachers cannot be required to join a union. However, in 22 states plus the District of Columbia, teachers are required to pay "agency fees," or the cost of that part of the union dues that is dedicated to negotiating contracts. In California, that means that while union members pay roughly $1,000 a year in dues, those who opt out get about 30 percent of that refunded.

The Supreme Court held in 1977 a state could require these fees to cover the cost of collective bargaining, reasoning that otherwise non-union members would benefit as "free riders," without paying their fair share.

In that 9-0 decision, the court found that unions could separate their contract negotiations from their political activity, and that failure to do so would result in “free-riding.” The fees collected to negotiate contracts, currently deemed to be nonpolitical, are called "agency fees."

Coerced speech?

The plaintiff teachers argue that it is inherently political when a union presses a government agency — like a school district — to spend more or offer benefits to certain employees. You cannot bargain with the government without doing politics, they argue, and forcing an employee to pay for that bargaining is coerced speech, and therefore unconstitutional.

Based on previous statements and Monday’s arguments, observers on both sides agree that the court seems poised to embrace this argument. The usual swing vote, Anthony Kennedy, appeared to be the most hostile questioner, several sources reported.

Union supporters have looked this time to Atonin Scalia as a possible fifth vote in their favor. Back in 1991, Scalia wrote favorably of agency fees in a related case.

But in his questions and comments on Monday, Scalia seemed very much in the other camp, expressing strong skepticism toward mandatory fees, drawing a distinction between private and public union bargaining, and suggesting that it is “one thing to provide it for private employers. It’s another thing to provide it for the government, where every matter bargained for is a matter of public interest.”

And while the court will not actually issue its decision until June, strong skepticism of the status quo expressed by key justices or oral arguments this week has led many observers to see this as a done deal.

'A big deal'

The likely prospect of a 5-4 decision for the plaintiffs has opponents of teacher unions as excited as their defenders are resigned.

"This is a big deal," said Michael Petrilli, president of the Fordham Institute, a Washington, D.C.-based center-right education think tank. "If this decision goes the way most people expect, this is going to cost the teachers unions a lot of money, and it will weaken them politically."

Teacher unions typically make no secret of their Democratic partisan leanings, and teacher union financial donations flow accordingly. The question posed by Petrilli and other skeptics from the right is whether it is ever possible for a public employee union to separate that partisanship from nonpolitical activity.

Pushing for a bigger share of the public fisc is inherently political, critics argue. And, they add, pushing for stronger protections against scrutiny for poor performance is also political. And yet both pay and job protections are key aspects of collective bargaining.

"Liberals seem to understand this when they complain about the egregious way that police unions protect their members from public scrutiny," writes Meagan McCardle in Bloomberg. "But they have failed to note the obvious broader implications: All public-sector unions will end up operating the same way. And that will be especially true of the aspects of the job that are harder for the public to monitor."

The argument that teacher unions do not engage in politics with non-political money does not persuade Petrilli. "There is a whole lot of gray area," he said. "Collective bargaining is inherently political, as are communications with members, and conferences they hold. It is impossible to draw a line between the political and the non-political."

Petrilli says that once teacher unions cannot charge for collective bargaining, they will wield less heft on the political landscape, and teachers who disagree with their politics will no longer be frustrated by strengthening them.

A reasonable balance

“Part of the idea of a democracy is that when a majority speaks you go along with that,” says Richard Kahlenberg, a senior fellow at the Century Foundation. “As citizen, the teacher still has a right to speak out. But as a member of a profession with an exclusive bargaining agent, the teacher has to go along with the majority of teachers who voted in the union.”

Kahlenberg argues that the court struck a “reasonable balance” in 1977, allowing objectors to opt out of politics but still contribute to bargaining. Allowing non-union members to opt out of collective bargaining costs, he argues, is much like allowing taxpayers to opt out of the portions of government policy they object to.

It is not a violation of free speech, Richard Kahlenberg said, “when the federal government uses tax dollars paid by a pacifist to buy recruiting ads for the military.”

A new normal?

For defenders of teacher unions, this is not about coerced speech, it's about free-riding and the demise of unions across both public and private sectors.

"We've seen a decline of unions at the same time we've seen a decline of the middle class," said Michel Jawando, vice president for legal progress at the Center for American Progress. "That is not an accident," Jawando said.

Teacher union membership has been in sharp decline. From 2010 to 2013, the National Education Association lost about 234,000 members, the NEA reported, leaving them with just under 3 million members.

Jawando says the end of agency fees would mean that free-riding would escalate, as fewer paying members support the bargaining process by which new contracts are shaped for teacher pay, benefits and security. Unions would be forced to pare down their administrative and negotiating teams.

"We may have to design a new normal," Jawando concedes, "as to how we approach bargaining and how we value working people."

She points to Wisconsin, which recently pared back public employee union power. "There we've seen a drop off in union membership and wages in the public sector," she notes.

A death spiral?

Teachers in California fear that if the court does strike down agency fees, the California Teachers Union will have to choose between providing services and raising dues.

“That’s what I worry about most,” said Reagan Duncan, a first-grade teacher in Vista, California.

Roughly 94 percent of the teachers in Duncan’s CTA chapter are union members. But a huge wave of baby boomer teachers are now retiring. Their replacements, she fears, might not have the same attachment to the union, and with the altered financial incentives may choose not to join.

She fears that new teachers will not know the value of the union, and will be comparing the $1,000 to nothing, rather than to just over $600.

The CTA will then have to choose, Duncan said, between raising dues and cutting services, creating the risk of a downward spiral, as higher dues induce more teachers to leave the union and dues then are forced upward again.

“That’s what our opponents are hoping, says Eric Heins, president of the California Teachers Association. “The real purpose of the lawsuit is not what our opponents have been saying it is. It’s really about taking down public sector unions.”

The financial supporters of the legal action, Heins says, “are a who’s who of who has been attacking us for years.”

“They’ve tried it at the ballot box,” Heins said,” and the voters said no. Then they tried it at the legislature, and the legislators said no. And now they are trying it at the Supreme Court.”