U.S. Supreme Court Finds Aggregate Limits on Federal Campaign Contribution are Unconstitutional

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On April 2, 2014, the United States Supreme Court held in a 5-4 decision that aggregate contribution limits, those limits placed on an individual’s overall direct contributions during a two-year election cycle, were unconstitutional as a violation of the First Amendment. The case, McCutcheon v. Federal Election Commission, No. 12-536 (U.S. April 2, 2014), is the latest case in which the Supreme Court has loosened federal regulation of campaign contributions.

In a fractured decision, Chief Justice John Roberts authored a plurality opinion that struck down the aggregate limit as a “mismatch” between the government’s goal of curbing corruption and its chosen means of imposing an aggregate limit. Although the government has a valid interest in limiting quid pro quo corruption between contributors and elected officials, the Court explained, an aggregate limit imposed across all candidates does not limit the risk of corruption enough to justify the way it significantly limits the right to support candidates in an election. In the face of core First Amendment guarantees, the aggregate limit could not survive because it was not “closely drawn to avoid unnecessary abridgment of associational freedoms.” Slip opinion at 30 (citation omitted).

The Chief Justice was joined by three of his colleagues: Justices Antonin Scalia, Anthony Kennedy, and Samuel Alito. Justice Clarence Thomas wrote separately to say that he would both strike down aggregate limits and overturn key Supreme Court precedent sanctioning a wide array of campaign finance restrictions.

The Dissent

Writing for the four Justices in dissent, Justice Stephen Breyer argued that aggregate campaign contribution limits had been previously held to be constitutional and that the reversal of existing precedent will come at a grave cost to the U.S. political system. In his view, the decision of the plurality “undermines, perhaps devastates, what remains of campaign finance reform.” Slip opinion at 30 (Breyer, J., dissenting). Justice Breyer was joined by Justices Ruth Bader Ginsburg, Sonia Sotomayor, and Elena Kagan.

Unchanged Rules

Prior to today’s decision in McCutcheon, campaign contributions were subject to two key limitations. The first limit, which remains intact, is the base limit on individual contributions to a single campaign, party committee, or political action committee. That limit remains unchanged, thus there is still a limit of $2,600 that an individual may contribute to a candidate for each election in the two year election cycle. As a result, one may contribute $2,600 for a primary election, $2,600 for a general election, and an additional $2,600 if there is a runoff election. Limits on contributions to other committees may be seen on the below chart.

In addition, the decision has no impact on the operation of a Super PAC, otherwise known as an “independent expenditure-only committee.” Nor does the decision permit corporations to make contributions to federal candidate committees.

New Rule

The limit that was struck down today restricted the overall amount individuals can contribute to election campaigns during a given two-year election cycle. Those aggregate limits were most recently set at $48,600 for federal candidates and $74,600 for other political committees, including national and state party committees, for an overall limit of $123,200 per two-year cycle. As such, prior to this decision a person could give the maximum base contribution of $5,200, for both a primary and a general election, to a maximum of nine federal candidates, whereas now a person can contribute to all federal candidates if she so desires. Similarly, an individual may now contribute to as many PACs as desired, including state and federal committees, such as the Democratic National Committee and the Republican National Committee, as long as each contribution is within the base limit currently set at $32,400 for the national party committees.

In viewing the below chart from the Federal Election Commission, the box in the upper right corner, under Special Limits, has been eliminated. All the other listed limits continue to be the federal legal limits.

Kedar Bhatia contributed to this article.

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The NLRB Revives Controversial Expedited Election Rules – National Labor Relations Board

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On February 6, 2014, the National Labor Relations Board (NLRB) reissued its controversial rules aimed at expediting union elections in the workplace. This rule, referred to as the “Ambush Election Rule,” could limit an employer’s right to express its views to employees and respond to union statements. The proposed rules mirror the NLRB’s June 2011 proposal, which ultimately was struck down by a district court in May 2012.

Analogous to the June 2011 proposal, the NLRB’s most recent proposal seeks to significantly impact the current union election process. The proposed reforms are aimed at shortening the election cycle from the current median of 38 days from petition to election to as little as 10 to 21 days. The proposed reforms also would move resolution of voter eligibility determination to after the election; reduce the NLRB’s review of representation cases; expand employer disclosure of employee contact information (including e-mail addresses); and allow more electronic filing with the NLRB.

Despite reducing the amount of time an employer has to communicate its message or rebut the union’s statements, NLRB Chairman Mark Gaston Pearce has stated the proposed rules are intended to “improve the process for all parties.” The NLRB is likely to issue a final rule governing union elections later this year.

Action Steps?

The NLRB has issued a proposed rule, and by law, will allow for public comments through April 7, 2014. Employers may direct comments regarding the proposed reforms to the NLRB here. Additionally, the NLRB will hold a public hearing on the proposed rules in Washington D.C. during the week of April 7, 2014, and employers may voice their concerns at the forum.

Finally, employers should consider conducting a vulnerability audit to identify any concerns that can be addressed now (rather than after a final rule is put in place) and should provide supervisors and management with training so they are prepared to address any potential NLRB election situation.

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