Indeed it doesn't. They may not get the strike rewards, but all dropped engrams still show up at the postmaster. They can still complete many bounties, as kills by fellow fireteam members do count for them. They still get strike completions for whatever quest that requires them. And even if they want the end rewards, chances are that they might not be aware that AFKing prevents you from getting them. When they finally see the rewards screen, they won't know why they didn't receive anything and will keep AFKing.
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When I encounter an AFKer, I make a point by not killing a single enemy until they participate. I shoot them for a while so their controller keeps vibrating, then I dance next to them until they either help or leave. Of course, I try to make the third guy aware of what's happening so they don't have to carry two players instead of just one.
