Companies Must Deduct Union Dues After Contracts Expire

Dues deduction became a common practice in the mid-1900’s when few workers had checking accounts. Unions tired of going to each member individually to collect dues, so they negotiated into collective bargaining agreements clauses forcing the employer to payroll deduct the dues and remit a single check to the union for all members’ dues. Companies were relieved of this “tax collector” role upon the expiration of the collective bargaining agreement.

However, last year the NLRB changed the law on when companies can stop deducting union dues after a collective bargaining agreement expires. There is little practical reason for this rule since nothing prevents employees from paying their dues directly to the union. In fact, employees were still required to remit dues, companies just weren’t required to deduct them from employees’ paychecks. Nonetheless, the NLRB said that it was issuing the ruling because it would help the “goal of promoting collective bargaining.”

Now, businesses may stop deducting dues only after a lawful impasse has been reached. Lawful impasses are reached only after the NLRB agrees it has been reached. Yet, employees are allowed to strike immediately upon the expiration of the contract. Therefore, companies that are negotiating a new collective bargaining agreement may be faced with a situation where they bankroll a strike against themselves. How exactly does that further the goal of promoting collective bargaining?

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at