In a recent decision of the NLRB, greater scrutiny was given to what constitutes chargeable expenses of a labor organization, resulting in non-member employees being freed from the burden of paying for a union’s lobbying expenses.
Since the Supreme Court’s decision in Communication Workers v. Beck in 1988, the NLRB has recognized a category of “chargeable” expenses, which are those union expenses that can be paid by the forced contributions of non-members. Chargeable expenses was defined by the Supreme Court as costs “necessary to performing the duties of an exclusive representative of the employees in dealing with the employer on labor-management issues.” As the Board has explained, “the limits on compulsory union dues is rooted in the union’s duty of fair representation.” While the question of whether union lobbying efforts should fall within that scope had been addressed in the public sector and under the Railway Labor Act, it had not been definitively answered under the NLRA.
In United Nurses and Allied Professionals, (367 NLRB NO. 94, March 1, 2019) the employer, Kent Hospital, was an acute care facility in Rhode Island. The union, United Nurses and Allied Professionals, was the exclusive representative of the registered nurses at the hospital. The union also represented other registered nurse bargaining units in Rhode Island and Vermont; a total of 15 bargaining units. In 2009, the union used money from its operating fund to lobby for various legislation that was pending before the Rhode Island and Vermont legislatures. Generally, those bills would have benefitted registered nurses by providing additional funding for hospitals where the union represented nurses, establishing rules to protect nurses and, in Vermont, prohibiting the hospital from requiring any employee from working more than 40 hours. A non-member employee complained that the money spent by the union was “nonrepresentational activity,” and thus a violation of Section 8(b) (1) (a) of the Act.
After a tortured case history, the Board held in a 3-1 decision that relevant Supreme Court and Court of Appeals precedent “compels” holding that lobbying costs are not chargeable to an objecting non-member. Citing that precedent, the Board held the union’s authority to compel non-member financial support cannot go beyond the expenses “necessary to performing the duties of an exclusive representative” that is the union’s “statutory function.” Thus the Board concluded that lobbying expenses cannot be charged to non-members “though they may in general relate to terms and conditions of employment or may incidentally affect collective bargaining, (since) the lobbying activity is not part of the Union’s statutory collective bargaining obligation and therefore is non-chargeable.” Said another way, lobbying is not a representational function as set forth in Beck and can never be charged to an objecting non-member.
In dissent, member McFerran disagreed with the majority that the result is compelled by Supreme Court precedent. In her view, lobbying expenditures may be chargeable “if the Union can demonstrate that they were germane to collective bargaining, contract administration, or grievance handling and thus necessarily or reasonably incurred for the purpose of performing the duties of an exclusive bargaining representative.”
The result of this ruling is that funding for union lobbying will have to come solely from union member dues. This decision will have the greatest impact on unions who represent multiple units (particularly inter-state units) as was the case here, and international unions. Local unions who represent a single unit rarely engage in lobbying.