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Board Abandons Well Established Precedent – Holds that Employers Can No Longer Cease Deducting Union Dues Upon Contract Expiration

Since 1962, employers with a dues checkoff provision in a collective bargaining agreement have been permitted to cease deducting dues from employee paychecks and remitting them to the union upon contract expiration. As of last month, however, employers can no longer relieve themselves of the burden of collecting and remitting dues upon contract expiration. In WKYC-TV, Inc., 359 NLRB No. 30 (2012), the NLRB overruled its long standing precedent, citing “compelling statutory and policy reasons.” The NLRB justified its decision on a number of theories, including that there is no basis under the National Labor Relations Act to warrant a carve-out of dues checkoff from the general status quo rule and that maintaining the status quo upon contract expiration facilitates bargaining. Though the NLRB did not overrule any other provisions that have long been deemed to expire along with the contract, this change is significant to employers.

Notably, the new rule will not be applied retroactively. However, moving forward, employers are no longer permitted to cease dues deductions upon contract expiration. Failing to abide by a dues checkoff provision will now violate Section 8(a)(5) of the National Labor Relations Act.

By way of background, 50 years ago Bethlehem Steel, 136 NLRB 1500 (1962) held that despite the general requirement to maintain the status quo upon expiration of a collective bargaining agreement, certain contractual provisions expire along with the contract. Since that time, dues checkoff and arbitration provisions, among other provisions, have not survived contract expiration.

As a result, employers engaged in contract negotiations that extend beyond the contract expiration date routinely ceased deducting dues, resulting (intentionally) in reduced administrative burdens on their end and increased administrative hassle to the union, which then has to collect its own dues. At a time when the collective bargaining agreement has expired, and the parties are presumably embroiled in tense negotiations, the last thing that a union wants to deal with is spending time to collect dues. As a result of this recent NLRB decision, employers can no longer employ that strategy and must be mindful of continued compliance with a dues checkoff provision even after contract expiration.