National Labor Relations Board Reverses Long-Standing Precedent; Rules Employers May Not Discontinue Dues Deductions Following Contract Expiration
On December 12, 2012, the National Labor Relations Board reversed 50 years of precedent and announced that from now on employers may not unilaterally discontinue dues checkoff provisions after the expiration of collective bargaining agreements. Typically, employers are required to maintain the status quo upon the termination of a collective bargaining agreement and continue unchanged all mandatory terms and conditions of employment until either a new agreement or bargaining impasse has been reached. In Bethlehem Steel, 136 NLRB 1500 (1962), however, the Board determined that employers were not required to continue to comply with the union-security or dues checkoff provisions of expired collective bargaining agreements in spite of their being mandatory subjects of bargaining.
In a decision released this week, WKYC-TV, 359 NLRB No. 30 (2012), the Board reversed the Bethlehem Steel decision as it related to these dues checkoff provisions. It did so claiming there were “compelling statutory and policy reasons” to do so. Foremost, it recognized the general rule that employers must continue to comply with the provisions of expired collective bargaining agreements that deal with mandatory subjects of bargaining. Upon review of the NLRA, the Board determined that there was no statutory basis to exclude dues checkoff, a mandatory subject of bargaining, from this general rule. Although recognizing that some exceptions to the general rule existed, such as union security and arbitration provisions, the Board dismissed arguments that dues checkoff provisions met the necessary threshold for exclusion.
In a dissent, recently departed Member Brian Hayes questioned the propriety of changing 50 years of precedent without any evidence that the long-established rule had “impeded collective bargaining or the peaceful resolution of labor disputes. . .” He noted that, although the Ninth Circuit had questioned the rule in part, it had been upheld by both the Seventh and the D.C. Circuits. Finally, he recognized the unique contractual nature of dues checkoff provisions in collective bargaining and concluded that, as with union security and arbitration clauses, employers should not be required to comply with dues checkoff provisions after the expiration of collective bargaining agreements.
This decision appears to be based less on a need for change than a need to satisfy personal and political biases. For 50 years, the original dues checkoff rule remained in place with no effort by Congress and little effort by the courts to change it. Labor unions, of course, like the convenience of employers being responsible for the collection and payment of employee dues. The displeasure of chasing down individual employees to ensure dues are paid especially while negotiating a new contract is certainly unpalatable to them. Thus, the current more union-friendly Board has provided more financial security to unions during negotiations and potentially affected leverage points in bargaining relations.
Interestingly, in announcing the new rule, the Board clarified that it would only apply the rule prospectively, and it dismissed the Complaint against the employer.