Law and You > Labour Laws > Collective Bargaining and Trade Unions > Process of Collective Bargaining
Collective Bargaining is a process of discussion and negotiation between employer and workers regarding terms of employment and working conditions. Workers are generally represented by trade unions with respect to expressing their grievance concerning service conditions and wages before the employer and the management. It is perceived as a process both by employers and employees and important machinery to settle differences on the work-related issues. The need for collective bargaining in India arose, particularly after World War II.
Modernization, the need for quality, and increased productivity are important for competing in the international market. Modernization may cause the introduction of modern automatic machinery and may require high skilled labours. Thus modernization results in the displacement, laying off, and retrenchment of workers. Such condition results in hostility between the workers and the management. In such a case, management and workers must come together and use the concept of collective bargaining. Collective agreements provide the climate for the smooth working of the business.
Objectives of Collective Bargaining:
- To foster and maintain cordial relations between the employer/management and employees.
- To protect the interests of the workers and employer through collective action and by preventing unilateral actions from being taken by either party.
- To keep outside the government interventions
- To promote industrial democracy.
Characteristics of Collective Bargaining:
- It is a group or collective action as opposed to individual action. It is initiated through the representatives of the employees (trade union members).
- It is two-way give and take process because its outcome is mutually beneficial. The negotiation arrived at is acceptable to both parties: the employer and the employees. Hence it creates a stable relationship.
- It is a voluntary bipartite and continuous process without any third-party intervention.
- It is a flexible and dynamic process wherein no party adopts a rigid attitude. It changes as per the conditions prevailing at the time of negotiations.
- It ensures industrial democracy in the workplace. Both the employer and the employees who best know their problems, participate in the negotiation process.
- It is a practical way of solving issues between the employer and the employee.
- It involves balancing of strength and power.
- The decision taken by collective bargaining can be implemented speedily.
Subject Matter of Collective Bargaining:
- Rights and responsibilities of the management and of the trade union.
- Wages, bonus and other allowances including profit sharing.
- Hours of work, rest intervals.
- Production norms
- Leave and other facilities
- terms and conditions of service.
- retirement benefits
- Grievance redressal system.
- The procedure of joint consultation
- The procedure of settling disputes.
- Purpose, scope and duration of the agreement
- Differences in interpretation of the agreement
- the definition of important terms.
- Annual holidays and pays
- Termination, discharge, suspension and dismissal clauses.
- Prohibition of strikes and lockouts in the period of the agreement.
Prerequisites of Collective Bargaining:
- Right to organize and right to collective bargain: The success of collective bargaining depends upon the extent to which, the workers enjoy the right to organize and bargain.
- Presence of strong independent trade union: If the trade union is weak, employers can say that it does not represent the workers and will refuse to negotiate with it.
- Recognition of trade union:There may be many unions of workers but only one of them having the majority is recognized by the employer.
- Keeping aside prejudice: Both parties involved in collective bargaining must not have any prejudice about each other.
- The attitude of employers and trade unions: Collective bargaining is impossible between the parties which are rigid, non-compromising and close-minded.
- A give and take policy: The attitude to give and take should be followed by both the parties.
- A favourable political environment: When the government encourages collective bargaining as the best method of regulating conditions of employment, then it guarantees the success of collective bargaining.
- Unfair labour practices: Unfair Labour Practices will restrict the development of collective bargaining.
- Written agreements: The agreement must be observed by those to whom they apply.
- A suitable framework: The machinery for effective collective bargaining has been laid down either by the legislation of the country or by mutual agreement.
Process of Collective Bargaining:
Identification of Issue and Initiation:
During the identified issue for bargaining is categorized like wage issues, economic benefit issues, administrative issues, etc.
In Boulwarism method, the management themselves takes the initiative to find out through comprehensive research and surveys the needs of the employees. Based on the analysis of the findings, the company designs its own package based on the issues to be bargained. Thereafter, a change is incorporated only when new facts are presented by the employees or their unions.
In Continuous Bargaining method the parties involved are to explore particular bargaining problems in joint meetings over a long period of time, some throughout the life of each agreement. In this method, it is assumed that all persistent issues can be addressed through continuous negotiation over a period of time.
Preparation of Negotiations:
This step involves representatives from both the management as well as the trade. Representatives taking parts in negotiation from both the sides are decided. Draft for likely decisions is prepared in advance. The time and place of negotiation is fixed. The union representatives must consider attitudes and expectations of the employees over the issue under discussion and at the same time the financial position of the company.
Negotiation:
In this step, both the parties engage in the actual negotiation process at a time and at a place fixed for the purpose. Initial negotiations are done to arrive at a mutually acceptable agreement. Then this agreement is ratified by both the parties involved in the negotiations. When the two parties arrive at a mutually acceptable agreement, then it is ratified by both the parties.
Implementation of Agreement:
The agreement becomes operational from the date indicated in the agreement. The agreement must be implemented according to the letter and spirit of the provisions made by the agreement agreed to by both parties. The HR manager plays a crucial role in the day-to-day administration implementation of the agreement.
Conclusion:
Related Topics:
- Introduction to Collective Bargaining
- Types and Pre-Requisites of Collective Bargaining
- Disadvantages and Advantages of Collective Bargaining
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