(CNN) - A Wisconsin judge on Friday ruled as unconstitutional major portions of the controversial state law that restricted the collective bargaining rights of many public employees.
Dane County Circuit Judge Juan B. Colas found several aspects of the law contrary to both the state and U.S. constitutions.
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A challenge to the law was brought against Gov. Scott Walker and the Wisconsin Employment Relations Commission by two labor unions representing education and municipal employees.
Passed and signed in March 2011, the law restricts the rights of public employee unions to bargain collectively.
It also closed a $137 million hole the state budget and required many public workers - except police and firefighters - to pay more for their retirement and health benefits.
The suit claims the law restricts employees’ free speech, due process and association rights, and violates certain labor regulations. It also argued the Legislature did not have the authority to consider this law during the special legislative session in which it was passed.
Colas found that the law was not passed in violation of restrictions placed on special legislative sessions nor violated the constitutional due process protection.
But it did violate the employees' association and speech rights, Colas ruled.
The law serves to "single out and encumber the rights of those employees who choose union membership and representation solely because of that association and therefore infringe upon the rights of free speech and association guaranteed by both the Wisconsin and United States Constitutions," Colas wrote.
He also found a portion of the law relating to retirement contributions exceeded the legislature's authority and was a "local affair." The Wisconsin Constitution grants broad authority over non-statewide issues to local governments.
The suit was brought by employees of the Madison Metropolitan School District and the City of Milwaukee. It was not clear Friday how the ruling would affect state workers.
In a statement released after the ruling, Walker suggested the state would appeal and he referenced his June recall election win.
"The people of Wisconsin clearly spoke on June 5. Now, they are ready to move on," he said. "Sadly a liberal activist judge in Dane County wants to go backwards and take away the lawmaking responsibilities of the legislature and the governor. We are confident that the state will ultimately prevail in the appeals process."
The Wisconsin State AFL-CIO union president said in a statement, "Scott Walker's attempt to silence the union men and women of Wisconsin's public sector was an immoral, unjust and illegal power grab."
"Now, a court has ruled that the essential provisions of Act 10, Scott Walker's draconian attack on public worker's right to collectively bargain, is unconstitutional," Phil Neuenfeldt said.
Protesters swarmed the state house in 2011 as the law was under consideration, and several legal challenges and a nationally-watched recall election seeking the ouster of Walker followed passage of the law.
National political and union groups weighed in, sending money and supporters to aid both sides.
Democratic legislators fled the state to prevent the state Senate from reaching a quorum and voting on the measure, and at least one Republican legislator said he received death threats.