Union Shop

A union shop is a form of a union security clause under which the employer agrees to hire either labor union members or nonmembers but all non-union employees must become union members within a specified period of time or lose their jobs.

Under the National Labor Relations Act (NLRA), as amended by the Taft-Hartley Act, a union may require that employees either join the union or pay the equivalent of union dues. Nonmembers who object to that requirement may be compelled to pay only that portion of union dues that is attributable to the cost of representing employees in collective bargaining and in providing services to all represented employees, but not, with certain exceptions, to the union's political activities or organizing employees of other employers. Additional restrictions apply to unions covered by the Railway Labor Act (RLA) and unionized governmental employees.

The NLRA requires that employees must be given at least 30 days from the date of hire to join the union before they may be subject to being fired for failure to join the union or pay dues; shorter periods apply in the construction industry. The RLA gives employees 60 days to join the union. The union cannot, however, require that an employee become a member "in good standing": do more than pay dues or their equivalent. While a union shop agreement that, by its literal terms, requires an employee to become a member in good standing might appear to be unlawful on its face and therefore unenforceable, the National Labor Relations Board (NLRB) and the courts have uniformly interpreted such clauses to require no more than what the law permits (such as payment of dues).

Under United States labor law, a private sector union can expel a member from the union for any number of reasons, so long as it provides the member with the minimum due process required by the Labor Management Reporting and Disclosure Act (LMRDA) and does not do so for reasons prohibited by law (such as the member's race or protected political activities within the union). The union cannot, on the other hand, use a union shop agreement to require an employer to discharge a member for failure to maintain membership in good standing unless that member has been expelled from the union for failure to pay uniformly required union dues and fees. If the union expels a member for some reason other than failure to pay dues, it effectively terminates any right it might have had to demand that the employee pay dues thereafter or request that the employee be discharged for failure to do so.

The NLRA imposes additional requirements before a union can invoke a union shop agreement clause to require an employer to fire an employee who has failed to pay dues. While the union does not have to give the individual employee the sort of trial-type hearing required by the LMRDA to expel a union member for other reasons, the union must give the employee a detailed written explanation of the amount of delinquent dues that the employee owes and how those dues were calculated, and allow the employee a reasonable opportunity to pay those delinquent dues and fees before it asks that the employee be fired. In addition, the union must give all employees roughly the same opportunity to cure any delinquencies before requesting discharge; if the union gives one employee two weeks to pay delinquent dues, it must do the same for all others. The union is not, on the other hand, required to withdraw a request that an employee be fired for failure to pay delinquent dues if the employee makes the payment after the deadline but before the employer has effected the discharge. A union may owe back pay to employees who have been fired without these procedural protections; the employer may be liable if it effects the discharge when it knew or should have known that the union had not complied with the minimum requirements of the NLRA.

Under the NLRA, the union may demand payment only of those dues for periods when an employee was covered by a collective bargaining agreement that contained a valid union shop agreement. A union shop agreement may not be made retroactive to a period prior to the execution of the agreement. The union may not demand that an employee be fired for failure to pay extraordinary assessments that are not part of regularly, uniformly imposed dues. The LMRDA sets standards for the procedures that the union must follow when asking members to approve an increase in dues.

Union-represented employees covered by a union shop agreement may ask the NLRB to hold a "deauthorization election" to allow all bargaining unit employees to vote to determine whether the clause will continue to remain in effect. No such procedure exists under the RLA.