Closed Shop Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Closed Shop, written in plain English, along with examples of how it is used.

What is Closed Shop?

It is a business or industry in which the employees are required to be union members and if not they should become members within a specific time period of their joining the industry.

History and Meaning of Closed Shop

A closed shop is a type of collective bargaining agreement that requires employers to hire only union members, and employees are only able to continue working if they maintain their union membership. This made it difficult for employers to hire non-union employees. The term "closed shop" originated in Great Britain and migrated to the United States in the early 20th century. The Taft-Hartley Act of 1947 prohibited the practice of closed shop within the private sector. Although the act permits employers and labor unions to enter into union shop agreements, which allow the employer to only hire non-union employees who become union members within a certain period after their hiring.

Examples of Closed Shop

  1. In the 1930s and 1940s, the construction industry was particularly notable for its usage of closed shop agreements requiring union membership.
  2. Closed shops were prevalent in the transportation sector in the United States. For example, airlines, trucking, and transport workers were only permitted to be hired if they were union members.
  3. An example of a closed shop was that of the National Football League players' union. Until the 1990s, becoming a member of the union was the only way that a player could be part of the league.

Legal Terms Similar to Closed Shop

  1. Union shop - a type of agreement that permits employers to hire non-union employees but mandates that those employees become union members within a certain amount of time.
  2. Agency shop - a type of agreement that requires employees to pay a fee to a labor union that represents them in collective bargaining, even if they are not members of the union.
  3. Open shop - a type of workplace that does not require employees to become union members to be hired or retain employment.