CLIENT UPDATE

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August 31, 2015

NLRB Holds Dues Check-Off Continues After Expiration of Agreement

On August 27, 2015, the National Labor Relations Board (“the Board”) issued a decision in Lincoln Lutheran of Racine holding that an employer’s duty to abide by a union dues checkoff provision survives expiration of the relevant collective bargaining agreement. A union dues checkoff provision is a provision in which the employer deducts union dues from the employees’ paychecks and remits them to the union.

The Lincoln Lutheran of Racine decision overruled the Board’s 55-year old decision in Bethlehem Steel, 136 NLRB 1500 (1962), which held that a dues-checkoff provision terminates upon expiration of a collective bargaining agreement. The Board’s ruling in Bethlehem Steel allowed employers to automatically cease deducting union dues from employee paychecks and remitting them to the union upon expiration of the agreement. The Bethlehem Steel rule provided employers with a valuable economic weapon and tactical advantage during collective bargaining for a successor agreement, as the union would no longer be able to collect the dues owed to it without the assistance of the employer.

In issuing the Lincoln Lutheran of Racine decision and rejecting long-standing precedent, the Board majority stated that allowing the employer to cease dues-checkoff upon contract expiration is inconsistent with established Board policy which “generally condemn[s] unilateral changes in terms and conditions of employment.” Accordingly, the Board held that following contract expiration employers “must continue to honor a dues-checkoff arrangement established in that contract until the parties have either reached a successor collective-bargaining agreement or a valid overall bargaining impasse permits unilateral action by the employer.”

The Board’s new rule will only be applied prospectively to cases filed after the August 27th decision.

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Please contact us if you have any questions regarding this decision and the Board’s new standard for dues check-off after the expiration of a collective bargaining agreement.