NLRB Reverses Position on Obligation of Employers to Continue Deducting Union Dues After Expiration of CBA
History of Dues Checkoff Precedent
In 1962, years before most working Americans were even born, the NLRB issued its decision in Bethlehem Steel. That decision held that dues checkoff clauses in collective bargaining agreements do not automatically survive expiration of the contract. More specifically, under Bethlehem Steel, employers are permitted to unilaterally cease dues deductions following the expiration of a collective bargaining agreement, even where the contract contained a dues checkoff provision.
The Bethlehem Steel case remained the law of the land for over fifty years. In 2015, under the pro-union Obama Board, the NLRB majority overturned the long-standing Bethlehem Steel precedent and ruled, in Lincoln Lutheran of Racine, that dues checkoff clauses survive expiration of the CBA and that employers with dues checkoff provisions in a CBA are required to continue to deduct dues even after expiration of the CBA.
Lincoln Lutheran began the ping-ponging of the precedent on this issue. Four years after Lincoln Lutheran, under the pro-employer Trump NLRB, the Board vacated Lincoln Lutheran and reinstated the Bethlehem Steel precedent in Valley Hospital Medical Center (Valley Hospital I), 368 NLRB No. 139 (2019). Commencing in December 2019, employers again were free to cease deducting union dues from paychecks when a CBA with a dues checkoff clause expired.
In August of 2021, shortly after pro-union NLRB General Counsel Jennifer Abruzzo was confirmed by the Senate, this blog recognized that Valley Hospital I was unlikely to continue as the law of the land through the life of the Biden NLRB. On September 30, that prediction proved accurate.
In a 3-2 decision in Valley Hospital Medical Center, Inc., (Valley Hospital II) 371 NLRB No. 160 (2022) the Biden Board eviscerated the reasoning of Valley Hospital I and brought back the Obama Board’s reinvigorated Lincoln Lutheran. The NLRB majority held in Valley Hospital II that employers must continue deducting union dues on the expiration of a CBA. NLRB members Marvin Kaplan and John Ring dissented, declaring that dues checkoff is only a contractual duty and therefore should not survive the expiration of the contract.
The Flip-Flopping NLRB
Valley Hospital II is not a surprise at all. The NLRB flip-flopping on key issues, based on who is President - and therefore which party has the Board majority, has become the norm. The Obama Board issued a number of very pro-union precedential decisions. The pro-employer Trump Board reversed most of them. Now, the Biden NLRB is picking apart the Trump Board precedent, while reinstating, and even expanding, the union protections provided by the Obama Board.
Current Status of the Law
Employers with expiring CBAs now need to understand that they must continue to deduct dues from employees’ paycheck as if the CBA was still in place. Now, under Valley Hospital II, the only way the employer can cease deduction dues is if the dues checkoff language in the CBA expressly provides the employer with the right to do so. Employers negotiating new agreements may want to attempt to include such language in their new CBAs.
If you have any questions about this article or union relations matters, please feel free to contact the author of this article, Mark S. Spring, who also is the Chair of the CDF Labor Law LLP’s Traditional Labor Law Practice Group.