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Lecture 07

Collective Bargaining

M Akbar Ali, bpm ppm
+880 1711 806 888

After reading this chapter you should have a good

understanding of

a. Definition, concept & Characteristics of Collective Bargaining,

b. Importance & Functions of Collective Bargaining,
c. Principles, Forms & Levels of
d. Collective Bargaining Process
e. Pre-requisite for Successful Collective Bargaining
f. Third Party involvement in Collective Bargaining.

The Collective Bargaining Process

The term collective bargaining is made up of two

action through representation and

Negotiating, which involves proposals and counterproposals, offers and counter-offers.

Thus it means collective negotiations between the

employer and the employee, relating to their work

The Collective Bargaining Process

The negotiation, administration, and interpretation of a
written agreement between two parties, at least one of
which represents a group that is acting collectively, that
covers a specific period of time.
According to the Encyclopedia of Social Sciences,
Collective bargaining is a procedure, by which employer
and a group of employees agree upon the conditions of
The ILO Workers Manual defines collective bargaining as,
negotiation about working conditions and terms of
employment between an employer, a group of employers
or one or more employers organizations, on the one hand,
and one or more representative workers organization on
the other with a view of reaching an agreement.

The solution to common problems between employers and trade

unions can be found directly through negotiation between both parties
and in this context the scope of collective bargaining is very great.
If it works well, it develops a sense of self-responsibility and selfrespect among the employees concerned and thus significantly paves
the way for improved employee morale and productivity.
Collective Bargaining restricts managements freedom for
arbitrary action and thereby management learns a new code of
behavior by conceiving of the union as a method of dealing with
The management comes to know the grievances of workers in
advance to take precautionary measure.
Opens up top and bottom channel of communication
CB if properly conducted, result in the establishment of a harmonious
industrial climate to help nations socio-economic development


Where there is only one trade union, that shall be taken as the Collective Bargaining Agent for that


Where the number of trade union is more than one, the Registrar shall take necessary steps to elect the


Trade unions having members of more than one third of the total workers employed in the establishment
can apply for contesting in the election.


Upon request from the Registrar, the employers shall submit the list of all workers employed in the
establishment, excluding those whose period of employment in the establishment is less than three
months or workers with records of insubordination and negligence-to-duty
Then, the Registrar shall send a copy of the list to each of the contesting trade unions and shall also affix a
copy in a conspicuous place of her/his office and another copy of the list in a conspicuous place of the
After amendments, alterations or modifications, if any, the Registrar shall prepare the final copy of the list
of workers employed in the establishment . The list shall be deemed to be the list of voters and every
person whose name appears in the list shall be entitled to vote to elect the Collective Bargaining Agent.
For the purpose of holding the secret ballot to determine the CBA, the Registrar shall do the following:
a. Fix a date and intimate the same to the contesting trade unions and the employer.
b. Set the sealed ballot boxes, which are sealed in presence of the representative of each of the
contesting trade
unions if any one present
c. Conduct the poll in the polling stations where the representative of the contesting trade unions shall
have the right
to enter
d. Count the votes in presence of the representative of the contesting trade unions if anybody is
e. Declare the result and the name of the elected Collective Bargaining Agent.


8. Where a registered trade union is declared as the Collective Bargaining Agent according to the above rules,
no such application for the determination of the CBA shall be entertained within the subsequent two years.

The Collective Bargaining Agent in relation to an establishment or group

of establishments shall be entitled to

* Undertake collective bargaining with the employer or the employers on

matters connected with the employment, non employment or terms of

* Represent all or any of the workmen in any proceedings

* The right of litigation for and on behalf of the one or all of the workers
under this Act

* Give notice of and declare a strike in accordance with provisions of the


* Nominate representatives of workmen on any committee, fund

constituted as per the provisions of law or agreements.

1. Collective bargaining as a process of social change

Collective bargaining enhances the status of the working class in
the society. Wage earners have enhanced their social and
economic position in relation to other groups. Employers have also
retained high power and dignity through collective bargaining.

2. Collective bargaining as a peace treaty

Collective bargaining serves as a peace treaty between the
employers and employees. However the settlement between the
two parties is a compromise.

3. Collective bargaining as an industrial jurisprudence

It is a method of introducing civil rights into industry. It
rules which define and restrict the traditional authority
by employers over their employees placing part of the
under joint control of union and management.

For both union and management

Should give due consideration to hear the problems on both sides.
Both should analyze the alternatives to arrive at the best solution.
Mutual respect on both the parties.
Both must have good faith and confidence in discussion and arriving at a
Effective leadership is required on both sides to moderate discussions and create
Both should observe the laws and regulations in practice in arriving at a
Labor should be given due consideration in wage fixation, in working
conditions, bonus etc.

For management
Should think of realistic principles and policies for labor regulations.
If there are more than one union, the management can recognize one which is
having the support of majority of workers.
Should follow a policy of goodwill, and cooperation in collective bargaining.
Need not wait for trade union to represent their grievances for settlement.
Should give due consideration to social and economic conditions of workers
in CB.

For Unions
Should avoid undemocratic practices.
Have to recognize their duties to the management also before emphasizing
their demands.
Have to consider the benefits to all workers rather than a section of workers.
Strike lock-outs should be resorted to, only as a last measure.

* The Collective Bargaining


Preparing to negotiate


Includes internal information (e.g.,

employee performance records, overtime) and external
(i.e., data on what similar organizations are doing and
the economy).
*Goal-setting: Management decides what it can expect
from the negotiation.
*Strategy development: This includes assessing the
other sides power and tactics.

Fundamentals of Human
Resource Management

Negotiating at the bargaining table

*Each side usually begins by publicly
demanding more than they are willing to
*More realistic assessments and
compromises take place behind closed
*After oral agreement, a written contract
is submitted to the union for ratification.

1. Negotiating team
Negotiating team should represent all groups including production, finance and industrial
relations experts.
2. Recognition of unions
The management should recognize the trade union and analyze the facts in their
representation of grievances. Mutual understanding encourages mutual agreement.
3. Open mind
Both the management and union should have open minds to listen and appreciate each
others point of view with flexibility and adjustment.
4. Home Work on demands
The union and management have to collect relevant data relating wages, conditions of
work, welfare schemes, cost of benefits.
5. Routine problems
The management and unions have to identify the grievances on routine basis and take
appropriate action then and there.
6. Internal union democracy
Trade unions should encourage internal union democracy by consulting the rank and file
7. Importance to output
Should give importance to output, quality of the products, companys image etc.

Involves five key activities:

* Obtaining substantial results

* Influencing the balance of power between parties
* Influencing the atmosphere
* Influencing the constituency
* Influencing the procedures.
A negotiation could result in any of the following situations:

* Win-lose
* Lose-win
* Lose-lose
* Win-win

To achieve win-win agreements, the parties should keep the following points
in mind while negotiating:


Focus on their interests, not take positions

Focus on the problem, not the person
Invent multiple solutions
Be creative
Expand the pie
Non-specific compensation
*Log rolling
Bridge the gap in perceptions through reformulation of the issue

*mutual praise
1. The exchanging of political favors, especially the trading of influence or votes
among legislators to achieve passage of projects that are of interest to one another.
2. The exchanging of favors or praise, as among artists, critics, or academics.
[From the early American practice of neighbors gathering to help clear land by
rolling off and burning felled timber.]


Bargaining Power:
The power of labour management to achieve their goals
through economic, social, or political influence.
* Union Bargaining Power
* Management Bargaining Power
Lock out
Transfer operation in other location