A business must continue to deduct union dues from an employee’s paycheck even after the union’s contract with management expires, the National Labor Relations Board has ruled, reversing a 50-year precedent.
The new requirement will give unions a major edge in contract negotiations with management, removing one of the main factors — the loss of money — that could compel them to compromise to reach a deal.
“The fact that dues checkoff normally is an arrangement created by (a labor/management) contract simply does not compel the conclusion that checkoff expires with the contract that created it,” a 3-2 board majority found in the case Lincoln Lutheran of Racine and Service Employees International Union Healthcare Wisconsin. The NLRB, the main federal labor law enforcement agency, released the ruling Thursday.
Most union contracts include so-called “security clauses” requiring all employees at a workplace to join or otherwise financially support a union. A common feature of the contracts is to have the dues automatically deducted from the workers’ paychecks. In a 1962 case called Bethlehem Steel, the board said management’s obligation to do that ends when the contract expires.
The majority overturned that precedent Thursday and said businesses must continue to withdraw the dues “until the parties have either reached a successor collective-bargaining agreement or a valid overall bargaining impasse permits unilateral action by the employer.” A “valid” impasse would be an official NLRB declaration that efforts to negotiate a contract have failed, allowing the board to intervene.
In other words, businesses will be allowed to stop deducting union dues only once the NLRB gives them permission to do so. The new standard means that a business could now find itself in the position of bankrolling a strike against itself.
“We are disappointed although not surprised that the Obama Labor Board has yet again overturned decades of precedent to empower union bosses and make it more difficult for employees to cut off payment of union dues,” said Pat Semmens, spokesman for the National Right To Work Legal Defense Foundation, which filed an amicus brief in the case.
The NLRB said that it was issuing the ruling because it would help the “goal of promoting collective bargaining.”
The board limited the provision to future contracts, conceding that it was a substantial policy change and therefore unfair to apply to current cases.
The dissenting board members, Harry Johnson and Philip Miscimarra, said that there was no reason to require that the deductions continue, noting that the same standard was not being applied to other aspects of labor-management contracts.
“Arbitration clauses are not subject to the … post-expiration bargaining requirement,” they noted. “No-strike and no-lockout clauses likewise fail to survive contract expiration.”
They further argued that there was little practical reason for the ruling since nothing prevents union members from paying their dues directly to the union. Dues deduction became a common practice in the mid-20th-century when few workers had checking accounts. Those circumstances no longer apply, they argued.
The board issued a similar ruling requiring continuing dues checkoff in 2012. But that decision was voided by the Supreme Court’s ruling two years later in the case Noel Canning v. NLRB. The court found that President’s Obama’s recess appointments to the board were unconstitutional, effectively wiping out all NLRB rulings from when the appointees were on the board including all of 2012. The board used Thursday’s ruling to re-do the 2012 effort.
