The NLRB Weighs in on Union Obligations to Dues Objectors

Lobbying is out, trust but verify, and stand by for more chan

If you work for or belong to a union, you are probably familiar with the concept of “fair share” fees and non-member objectors under Communication Workers of America v. Beck, a Supreme Court decision from 1988. The basic rule is that workers represented by a union can opt out of union membership and refuse to pay that portion of the dues not expended for collective bargaining, contract administration, or processing of grievances. These individuals are commonly known as “Beck” objectors, after the Supreme Court case that defined their rights. A union that uses a Beck objector’s fees for purposes unrelated to collective bargaining, contract administration, or processing of grievances violates the duty of fair representation owed to that employee.

On March 1st, in United Nurses & Allied Professionals (Kent Hospital) the National Labor Relations Board (the Board) held for the first time that unions may not charge non-member objectors for any expenses incurred in lobbying activities of any kind, even where the lobbying has the aim of benefiting their represented workers. The last time the Board considered this issue was seven years ago, when same case was first before it. Then, instead of acting on its own, the Board invited public comment as to whether certain lobbying expenses might be germane to a union’s collective-bargaining function and therefore appropriately charged to an objector. Before it could act on that public input, however, the appointments of two of the Board’s members were invalidated by the Supreme Court’s decision in NLRB v. Noel Canning. Seven years later, a new Board has answered the question, setting a bright-line rule that no lobbying expenses of any kind can be charged to Beck objectors.

In the same decision, the Board announced a new twist on the rules governing how unions explain to Beck objectors which expenses they are being charged for and which are only charged to full members. While unions have long been required to verify their statement of these expenses using an independent auditor, now they also must provide that auditor’s verification to the objector along with the statement. In a bizarre twist, the Board made this new verification requirement retroactive. This means that any statement of expenses that lacked the required verification and was sent within the last six months could be the subject of an unfair labor practice charge and complaint. Finally, the Board also dropped a footnote indicating that it would be willing to consider in a later case requiring unions to provide the statement of expenses earlier in the process.

The bottom line is that unions will need to review their statements of expenses carefully to ensure that they are not charging lobbying expenses to non-member objectors. Unions will also need to immediately begin providing an auditor’s verification with the statement of expenses they already send to objectors under their established procedures.