In Valley Hospital Medical Center, the National Labor Relations Board returned to the longstanding precedent that dues-checkoff provisions – a contractual requirement that employers automatically deduct union dues from employee paychecks, and remit the dues to the union – are enforceable only for the duration of the applicable collective-bargaining agreement (CBA) reached by the parties. Thus, an employer’s refusal to continue dues checkoff following expiration of a CBA does not violate the National Labor Relations Act
Prior to 2015, and for more than 50 years, it was settled Board law that dues checkoff provisions lapsed when the CBA establishing the checkoff requirement expired. In its controversial 2015 decision in Lincoln Lutheran of Racine, however, the Obama Board held that an employer had a statutory obligation to continue checking off dues after the expiration of the CBA that established the checkoff arrangement. After Lincoln Lutheran, an employer who ceased checking off union dues following CBA expiration, and without first notifying and bargaining with the union, committed an unlawful unilateral change, in violation of Section 8(a)(5) of the National Labor Relations Act.
While dues checkoff is a mandatory subject of bargaining, well-established case law created a category of mandatory subjects that are uniquely contractual in nature. This category of mandatory subjects includes management rights clauses, no-strike/no-lockout agreements, arbitration, union security, and, prior to Lincoln Lutheran, dues checkoff. The Board has now found that because dues checkoff is rooted in contract, it is enforceable only for the duration of the contract. Thus, for that reason, dues checkoff is excepted from the unilateral change doctrine requiring an employer to notify and bargain with the union prior to implementing a change to employee terms and conditions of employment.
Following this decision, employers may lawfully unilaterally cease deducting union dues from its employees’ paychecks when a CBA expires.