Striking Employee: No Need to Pay Them, But Can You Cancel Their Health Insurance?

The National Labor Relations Act is 81 years old. Nearly 70 years ago, the National Labor Relations Board confirmed that an employer has no obligation to finance a strike against itself by paying wages to employees during a strike. Relying on this, labor practitioners have routinely stopped wages, health care, and other perks of employment when employees go on strike. I know I have done this for several of my clients over the years. When done, strikers usually go on the union’s health care plan so long as they pay their premium and spend time walking the line. Is anyone surprised that the current NLRB changed the law last month and ruled that stopping health care during a strike may now be illegal?

In Hawaiian Telcom, Inc. (Feb. 2017), the two Democrat Members of the Board concluded that an employer’s right to stop benefits is a matter of contract interpretation. That is, unless the collective bargaining agreement says an employer can do it, an employer cannot do it. Specifically, in Hawaiian Telcom, the contract provided medical insurance for all employees covered by the Agreement, with no exceptions, except for termination of employment. Strikers have not terminated their employment, so the NLRB decided that medical benefits could not be stopped during the strike, even though the collective bargaining agreement had expired.

This decision adds yet another layer of complexity to negotiations. Management negotiators must be prepared to clog up a collective bargaining agreement by including extremely detailed nuances of when contract clauses apply and when they do not apply. This is bad news for both labor and management and erodes one of the tenants of the intent of the National Labor Relations Act – to provide for labor stability.

Matt Austin owns Austin Legal, LLC, a boutique law firm based in Ohio that limits its representation to employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 285-5342 or email him at Matt@MattAustinLaborLaw.com.

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