NLRB Holds that Dues Check-Off Survives Contract Expiration

An employer must continue to honor a dues check-off provision in a collective bargaining agreement (CBA) even after the CBA expires, the National Labor Relations Board recently ruled, overturning 50 years of precedent.  The Board now holds that an employer may unilaterally cease dues check-off only when collective bargaining negotiations have reached a valid impasse. Generally, an employer violates Section 8(a)(5) of the National Labor Relations Act if it changes union-represented employees’ wages, hours, and other terms and conditions of employment (i.e., mandatory subjects of bargaining) on its own accord, without first bargaining to impasse with the union.  If the CBA is a “9(a) agreement” – which characterizes all CBAs outside the construction industry and a minority of CBAs in the construction industry – then this rule normally applies even after the CBA has expired.  However, the Board has carved out some exceptions to this rule.  In the 1962 Bethlehem Steel case, the Board made dues check-off such an exception.  In that case, and consistently since that case, the Board held that an employer’s obligation to deduct union dues from employees’ wages terminates upon expiration of the contract that establishes the obligation. In the present case, WKYC-TV, Inc., the Board decided to re-examine the Bethlehem Steel rule and found “compelling statutory and policy reasons to abandon” that rule.  The Board stated that “requiring employers to honor dues-checkoff arrangements post-contract expiration is consistent with the language of the Act, its relevant legislative history, and the general rule against unilateral changes in terms and conditions of employment.”  Accordingly, the Board overruled Bethlehem Steel and its progeny.  However, because employers have long relied on Bethlehem Steel, the court decided that it would not apply the new rule in the present case or in pending cases, but only in new cases going forward. The impact of the case on AGC’s union-contractor members is not universal.  First, as referenced above, most construction-industry CBAs are not 9(a) agreements.  Rather, they are “8(f)” (a.k.a. “pre-hire”) agreements.  The Board did not address whether its new rule would apply in an 8(f) context.  However, because employers with 8(f) agreements do not have a duty to bargain after CBA expiration, the new rule probably does not apply.  On the other hand, it is theoretically possible that the present Board would deem an employer to have a duty to bargain in good faith to impasse after expiration of even an 8(f) agreement once the employer chooses to begin bargaining. It is also worth noting that the validity of the present decision, along with all of the Board’s decisions since August 2011, is in question due to challenges to the legitimacy of certain Board members’ appointments.  Click here for the latest information on that matter.