In the United States, a closed shop agreement is a contract provision that requires an employer to hire only union members. That means employees must belong to a union or agree to be a member of a union before they can be hired or continue their employment with the company. But is this type of agreement valid or invalid?
The answer is a bit complicated. Under the National Labor Relations Act (NLRA), closed shop agreements were initially made illegal in 1947. However, the Taft-Hartley Act of 1947 allowed states to pass right-to-work laws, which made closed shop agreements illegal. This means that in states that have right-to-work laws, closed shop agreements are invalid.
Currently, there are 27 states that have right-to-work laws, including Alabama, Arizona, Arkansas, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Nebraska, Nevada, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, and Wisconsin.
In states without right-to-work laws, closed shop agreements are valid. However, the Supreme Court has placed some restrictions on the use of such agreements. In the 1963 decision in NLRB v. General Motors Corp., the Court held that a union can only negotiate a closed shop agreement if it can prove that the arrangement is necessary to prevent “free riders” or non-union members who benefit from union bargaining but do not pay union dues.
Additionally, the Court held in the 1988 decision in Communication Workers v. Beck that employees who object to union membership on religious grounds can be exempt from paying union dues. This means that the union cannot force these employees to become members or pay dues as a condition of employment.
In conclusion, whether a closed shop agreement is valid or invalid depends on the state in which the employer operates. In states with right-to-work laws, closed shop agreements are illegal while in other states, they are valid. Nevertheless, even in states where such agreements are valid, there are restrictions on their use. Employers should work with experienced legal counsel to ensure that they are complying with all relevant labor laws.