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Supreme Court Clarifies Legality of Union Security Clause Requiring "Union Membership"

December 2, 1998

On November 3, 1998, the U.S. Supreme Court ruled that a union does not violate its duty of fair representation by negotiating a union security clause which requires each covered employee to be a "member in good standing" of the union. Marquez v. Screen Actors Guild, 1998 U.S. LEXIS 7110 (November 3, 1998).

Although many collective bargaining agreements contain a union security clause, providing that each employee covered by the agreement must become a "member" of the union within thirty-one days of the employee's date of hire, an employee may satisfy the "membership" obligation without becoming a full-fledged member of the union. Under applicable case law, an employee who wishes to resign from the union or who chooses not to join a union need only pay to the union an amount equal to the dues and fees which are to be used for the purpose of collective bargaining, contract administration, or grievance adjustment. Thus, the union may not require actual membership, nor may it compel payments by employees of money to be expended for purposes such as political contributions, lobbying activity, and other activities outside of the union's "core" representational functions. An employee who chooses not to join the union is deemed a "financial core" member and, unlike actual union members, is not subject to union fines or discipline for violation of the union's internal rules.

Because typical union security clauses can potentially mislead employees into believing that they must become actual members and pay full membership dues, the Supreme Court ruled in its landmark Beck case in 1988 that a union must notify employees that they have the right to refuse union membership and to pay only financial core dues. If the union fails to give the required notice, the union has violated the National Labor Relations Act and an employee is entitled, upon request, to a refund of any dues and fees paid by the employee to the union in excess of financial core dues.

The NLRB has taken the position that generic union security clauses, which purport to require "union membership," although ambiguous, are not facially violative of the National Labor Relations Act. However, at least two federal appeals court have disagreed. Buzenius v. NLRB, 124 F.3d 788 (6th Cir. 1997); Bloom v. NLRB, 30 F.3d 1001 (8th Cir. 1994). These courts ruled that, to be lawful, a union security clause which states that employees must become and remain union "members in good standing" must also contain a concurrent definition of that term which is limited to financial core membership. The courts reasoned that to allow bare language requiring membership, without explanation, would be deceptive to employees and would violate the principle of voluntary unionism.

In its recent decision in Marquez, however, the Supreme Court has apparently overruled the Sixth and Eighth Circuit decisions in favor of the NLRB's analysis. In Marquez, the Court considered whether a union's negotiation of a union security clause that fails to include language notifying the employees of their right to refuse union membership and to substitute for such membership the payment of financial core dues, violates the union's duty to give fair representation to the employees it represents. The union security clause at issue merely tracked the statutory language of Section 8(a)(3) of the National Labor Relations Act, which permits the use of union security clauses by stating, without elaboration, that a collective bargaining agreement may require "membership" in a union.

The Court ruled that the negotiation of such a clause does not constitute a breach of the union's duty of fair representation. The Court observed that earlier decisions had held that the language of Section 8(a)(3), which authorizes agreements requiring "membership" in a union, incorporates an employee's right not to become a full-fledged member of the union, although the statutory language does not explicitly so state. Thus, the Court ruled, the union cannot be faulted for entering into an agreement which uses the very statutory language that has been held to incorporate the right not to join the union.

Nonetheless, the Court explicitly made clear that while a union need not negotiate a contractual clause that itself notifies employees that they may not be required to "join" the union, it must nonetheless advise them of their Beck rights in some other fashion. The Court noted that the NLRB is currently in the process of defining the content of the required notification, to give guidance to unions about what they must do to notify employees about such rights.

Although it is now clear that an employer and union may agree to union security language that does not contain an explanation of the right to be only a financial core member, neither party may enforce such a clause in a way that would violate the employee's right not to "join" the union. Thus, employers should continue to be wary of complying with a union's request that an employee be discharged based on his or her failure to comply with the membership requirements imposed by a union security clause, absent evidence that the employee was notified that he or she need not be a formal member of the union and that he or she failed to pay dues for core representational functions.