‘Tis the season for cards and gifts, and apparently, the National Labor Relations Board (“NLRB” or “Board”) is filled with the holiday spirit. In a decision issued last week but only released today, the NLRB gave labor unions a gift that will keep on giving when it overturned a fifty-year-old precedent to determine that employers will normally be obligated to continue deducting union dues even after a collective bargaining agreement expires. In WKYC-TV, Inc., 359 NLRB No. 30 (Dec. 12, 2012), the Board’s three Democratic members (Chairman Pearce, and Members Griffin and Block, over the dissent of the lone Republican, Member Hayes), overturned a rule it had established in 1962 that, absent an extension agreement, an employer was free to discontinue union dues deductions after a collective bargaining agreement expires.
Employers are normally obligated to maintain the “status quo” or existing terms and conditions of employment following the expiration of a collective bargaining agreement. Thus, unless there is a lawful impasse in negotiations, everything stays the same and an employer may not change wages, job assignments, vacation scheduling procedures, overtime assignment rules, health and welfare contributions, or any other term or condition of employment during the hiatus after a collective bargaining agreement expires and before a new labor agreement is negotiated. There are several exceptions to this rule, however, including the obligation to arbitrate grievances arising after contract expiration, the prohibition against a strike or a lockout, and the ability to continue acting unilaterally under any contractual management rights clause. Because arbitration to settle contract disputes is generally considered the tradeoff for the right to engage in economic action (such as a strike or lockout), these terms do not survive expiration of a labor agreement. Similarly, a contractual management rights clause is considered a waiver of the union’s right to bargain over unilateral management actions, and waivers of bargaining rights typically will not survive a labor agreement.
In Bethlehem Steel, 136 NLRB 1500 (1962), the NLRB ruled that an employer’s dues-checkoff obligations were tied to the existence of a contractual union security clause which, like a management rights or no strike clause, expires with the labor agreement. While employees must sign a union authorization card that permits automatic deductions for union dues before an employer may make those deductions, these cards by law cannot be irrevocable beyond the shorter of one year or the expiration of the collective bargaining agreement. Accordingly, the Board has held for fifty years that when a labor agreement expires, both the union security clause and any obligation to deduct and remit employees’ union dues terminates.
Employees often continue working without a contract after their collective bargaining agreement terminates and employers often stop deducting dues as a way of exerting pressure on a union to reach a new labor agreement. With last week’s decision, the Board will now find it an unfair labor practice if an employer unilaterally stops deducting union dues after a collective bargaining agreement expires. While the Board acknowledged that labor agreements may be drafted to provide for the expiration of dues deductions, it noted that such a clause must be “clear and unmistakable.” Thus, before ceasing union dues deductions, an employer should carefully review its dues-checkoff clause to see whether it clearly and unmistakably terminates with the labor agreement. And even if a union engages in a strike, employers may now be required to continue deducting dues from crossovers – bargaining unit employees who choose not to or abandon a strike – without knowing whether they resigned their union membership (and dues-checkoff authorizations). With dues continuing to roll in following contract expiration, a union will not need to collect dues from its members manually and can continue to fund its operations. This holiday season the union authorization card has become the NLRB’s gift that will keep on giving. But of course, the year is not over and we may yet see even more gifts to organized labor. Ho, Ho, Ho!