About Us  |  About Cheetah®  |  Contact Us

Employer’s obligation to deduct union dues under dues check-off arrangement survives expiration of CBA; Bethlehem Steel overruled

An employer’s obligation to check off dues from employees’ wages continues after the expiration of the collective bargaining agreement that established such an arrangement, ruled a divided four-member panel of the NLRB, overruling the Bethlehem Steel rule (WKYC-TV, Inc, December 12, 2012). The majority concluded that the language and policies of the NLRA strongly support a finding that dues check-off should be included among the overwhelming majority of employment terms that remain in effect even after the contract containing them expires. However, because employers have long relied on Bethlehem Steel in their dealings with unions, the Board found that it would be unjust to apply its new holding in pending cases. Member Hayes dissented in part.

Dues check-off authorization. In this instance, the employer and union had been parties to multiple CBAs. The latest agreement contained a union security provision that required employees to become and remain members of the union as a condition of employment. It also included a dues check off provision under which the employer agreed to deduct union dues from employees’ wages and remit them to the union, provided the employee authorized the deduction.

Pursuant to a reopener provision, the employer terminated the existing contract and the parties began negotiations for a successor agreement. The employer continued to honor the dues check-off arrangement in the terminated agreement. The employer then implemented portions of a final offer, including the identical union-security provision, although it advised the union that the union-security provisions were not among the portions of the final offer it intended to implement. Nevertheless, the employer continued to deduct union dues and remit them to the union. Several months later, the employer ceased deducting and remitting union dues. It did not bargain with the union regarding this change. The union alleged that the employer acted unlawfully when, following contract expiration, it ceased honoring the dues check-off arrangement without first providing notice and an opportunity for the union to bargain over that decision.

Applying Bethlehem Steel, an administrative law judge found the employer was free to unilaterally cease honoring the dues check-off arrangement when the contract expired. In Bethlehem Steel, the NLRB, relying on the proviso to Sec. 8(a)(3) that “nothing in this Act shall preclude an employer from making an agreement with a labor organization to require as a condition of employment membership therein,” held that an employer acted lawfully in unilaterally ceasing to honor a contractual union security clause. However, in this instance, the Board majority agreed with the acting General Counsel and the union that Bethlehem Steel and its progeny must be overruled. Requiring employers to honor dues check-off arrangements after the expiration of a contract was consistent with the language of the NLRA and the general rule against unilateral changes in terms and conditions of employment, the Board held. In holding to the contrary, Bethlehem Steel was decided based on reasoning that cannot withstand scrutiny.

Notice and opportunity to bargain. It has long been established that an employer violates Sec. 8(a)(5) of the NLRA when it unilaterally changes employees’ wages, hours, and other conditions of employment without providing their bargaining representative prior notice and a meaningful opportunity to bargain about the changes. Thus, where the parties’ existing CBA has expired and negotiations have yet to result in a subsequent agreement, the employer must continue in effect contractually established terms and conditions of employment that are mandatory subjects of bargaining until the parties either negotiate a new agreement or bargain to a lawful impasse. An employer’s decision to unilaterally cease honoring a dues check-off arrangement in an expired CBA plainly contravenes these statutory principles. Under settled Board law, dues check-off is a matter related to wages, hours, and other terms and conditions of employment, and is therefore a mandatory subject of bargaining. Consequently, the status quo rule should apply to dues check-off.

Nothing in federal labor law or policy suggests that dues check-off arrangements would be treated less favorably than other terms and conditions of employment for purposes of the status quo rule. The plain terms of Sec. 302(c)(4) of the LMRA indicate that Congress contemplated that a dues check-off arrangement would continue beyond the life of the CBA establishing it. Section 302(c)(4) contains no language making dues check-off arrangements dependent on the existence of a CBA. Rather, the only document necessary is a written authorization of the deductions. Further, had Congress intended that dues check-off arrangements would automatically expire upon contract expiration, there would have been no need to say that employees can revoke their check-off authorizations at contract expiration. Nothing in Sec. 302(c)(4) suggests that Congress intended to permit employers to unilaterally revoke check-off arrangements.

Member Hayes dissented from the majority’s holding. He noted that dues check-off clauses do not fit neatly into the scheme regarding employers’ status quo obligations. Moreover, he argued that the Board had recognized in other settings that the complex situations that arise under the NLRA cannot always be forced into neat categories, and has responded flexibly in an effort to implement to the fullest the federal labor policy that Congress has established. For 50 years, Bethlehem Steel has been the law, and Congress has never legislatively overruled it, Hayes observed.

No retroactive effect. Applying established law as enunciated in Bethlehem Steel and its progeny, an ALJ found that an employer did not act unlawfully by unilaterally ending its compliance with the dues check-off provision of the parties’ CBA following expiration of the agreement. A similar result was obtained in another case, where the law judge reasoned that he was bound by Bethlehem Steel. However, in WKYC-TV, the Board overruled Bethlehem Steel to the extent that it stood for the proposition that dues check-off does not survive contract expiration. Nevertheless, because the Board decided to apply the new rule only prospectively, Bethlehem Steel remained applicable to Nebraskaland, Inc and USIC Locating Services, Inc, Board cases issued subsequent to WKYC-TV.

The NLRB slip opinion numbers are 359 NLRB Nos. 30, 33, and 35.

Charles DeGross (Communications Workers) for Union. William Behan (Gannett Co) for WKYC-TV.

Jonathan Friedman (United Food and Commercial Workers) for Union. Michael F. McGahan (Epstein Becker & Green) for Nebraskaland.

Jonathan Walters (Markowitz & Richman) for Union. Cynthia Springer (Faegre Baker Daniels) for USIC Locating Services.