INTRODUCTION OF

COLLECTIVE BARGAINING
The concept of collective bargaining was introduced very late in
India as trade unions were found only in 20 th century. The
concept of collective bargaining attained significance only after
1962. The phrase collective bargaining is said to be coined by
Sydney and Beatrice Webb and Great Britain. It is made up from
two words collective which means “group” and bargaining which
means “proposals and counter proposals”. So it is a process in
which the representatives of a labour organization & the
representatives of business organization meet and attempt to
negotiate a contract or agreement, which specifies the nature of
employee-employer union relationship.
 DEFINITION
“COLLECTIVE BARGAINING IS AN
AGREEMENT BETWEEN A SINGLE
EMPLOYER OR AN ASSOCIATION OF
EMPLOYERS ON THE ONE HAND AND A
LABOUR UNION ON THE OTHER, WHICH
REGULATES THE TERMS AND
CONDITIONS OF EMPLOYMENT”
TUDWIG TELLER
 Nature of Collective Bargaining
• It is not equivalent to collective agreements because collective
bargaining refers to the process or means, and collective agreements
to the possible result, of bargaining.
• Collective bargaining may not always lead to a collective
agreement.
• It is a method used by trade unions to improve the terms and
conditions of employment of their members.
• Where it leads to an agreement, it modifies, rather than replaces,
the individual contract of employment, because it does not create the
employer-employee relationship.
• The process is bipartite, but in some developing countries the State
plays a role in the form of a conciliator where disagreements occur,
or where collective bargaining impinges on government policy.
 OBJECTIVES OF
COLLECTIVE BARGAINING
 Resolve differences over
knotty issues.
 Protect the interests of workers
through collective action.
 Carry out negotiations
voluntarily, without
interference from a third party.
 Arrive at an amicable
agreement through a process of
give and take.
 To arrive at an agreement on
wages and other conditions of
employment.
 To have peaceful co-existence
for the mutual benefits and
progress.
 To maintain employee-
employer relation bilaterally.
 CHARACTERISTICS
• Collective: Collective bargaining is a two way group process where
the employers representative and employees representatives sit
together to negotiate terms of employment.
• Strength: Both the parties in collective bargaining are strong and
equal.
• Voluntary: Both parties come to the negotiation table voluntarily in
order to go in particular negotiation. It is based on discussion,
mutual trust and understanding.
• Formal: It is a formal process in which certain employment related
issues are to be regulated at National, organization and workplace
levels.
• Flexible: It is a flexible and continuous process and not fixed or
static.
• Improvement: It is a method to improve the employer-employees
relation in organization and resolve management and employees
conflicts.
 CONTD…
• Representation: Collective bargaining is between the
representatives of employees and management. The management
does not directly deal with employees. It carries negotiations with
the representatives/executives of unions and association.

•Dynamic: Collective bargaining is dynamic, that go on changing

over a period and grows and expand the way of agreement, the way
of implementation and way of discussion.

•Continuous: Collective bargaining is continuous and begins with

agreement, the implementation of agreement and further
negotiations.

• Bipartite Process: Because the employee and employers

representatives negotiate directly face to face across the table.
 Types of Collective Bargaining
Agreements
1. Bipartite (or voluntary) agreements are drawn up in
voluntary negotiations between the employer and the
trade union. As per the IDA 31, such agreements are
binding. Implementation is generally non-problematic
because both parties reached the agreement voluntarily.
2. Settlements are tripartite in nature, as they involve the
employer, trade union and conciliation officer. They arise
from a specific dispute, which is then referred to an
officer for reconciliation. If during the reconciliation
process, the officer feels that the parties’ viewpoints have
indeed been reconciled, and that an agreement is
possible, he may withdraw himself.
3. Consent awards are agreements reached while a
dispute is pending before a compulsory adjudicatory
authority, and incorporated into the authority’s award.
Here the agreements are negotiated by the parties on a
voluntary basis when disputes are subjudiced. Later these
are submitted to the labour courts.
 TYPES OF
BARGAINING
CONJUNCTIVE OR DISTRIBUTIVE BARGAINING: Conjunctive
bargaining is the most common type of bargaining & involves zero-sum
negotiations, in other words, one side wins and the other loses. Both parties
try to maximize their respective gains. They try to settle economic issues
such as wages, benefits, bonus, etc. For Example, Unions negotiate for
maximum wages & the management wants to yield as little as possible –
while getting things done through workers.

COOPERATIVE / INTEGRATIVE BARGAINING: Integrative

bargaining is similar to problem solving sessions in which both sides are
trying to reach a mutually beneficial alternative, i.e. a win-win situation.
Both the employer & the union try to resolve the conflict to the benefit of
both parties. Both sides share information about their interests and concerns
and they create a list of possible solutions to best meet everyone's needs.
 CONTD…

PRODUCTIVITY BARGAINING: A form of collective bargaining leading to a

productivity agreement in which management offers a pay raise in exchange for
alterations to employee working practices designed to increase productivity.
Productivity bargaining has been described as "an agreement in which advantages
of one kind or another, such as higher wages or increased leisure, are given to
workers in return for agreement on their part to accept changes in working practices
or in methods or in organization of work which will lead to more efficient
working.

COMPOSITE BARGAINING: Workers believed that productivity bargaining

agreements increased their workloads. Rationalization, introduction of new
technology, tight productivity norms have added to this burden and made the life of
a worker some what uneasy. As an answer to such problems, labor has come in
favor of composite bargaining. In this method, labor bargains for wages as usual,
but goes a step further demanding equity in matters relating to work norms,
employment levels, manning standards and enviornmental hazards etc.
 Issues of collective
bargaining
1. Wages and working conditions
2. Work norms
3. Incentive payments
4. Job security
5. Changes in technology
6. Work tools, techniques and practices
7. Staff transfers and promotions
8. Grievances
9. Disciplinary matters
10. Health and safety
11. Insurance and benefits
12. Union recognition
13. Union activities/responsibilities
14. Management rights
 Effective Bargaining
 Be a good listener.
 Build a reputation for being fair but firm.
 Learn to control your emotions and use them as a tool.
 As you make each bargaining move, be sure you know its
relationship to all other moves.
 Measure each move against your objectives.
 Pay close attention to the wording of every clause negotiated;
they are often a source of grievances.
 Remember that collective bargaining is a compromise process;
There is no such thing as having all the pie.
 Try to understand people and their personalities.
 Consider the impact of present negotiations on those in future
years.
Forms of Bargaining Structures

One company dealing with a single

union
Several companies dealing with
single union
Several unions dealing with a
single company
Several companies dealing with
several unions
 ADVANTAGE
S
•Contract to guide standards.
•Participation in decision making process.
•All union members and management must confirm to terms of contract without
exception
•Process exists to question manager's authority if member feels something was done
unjustly.
•Improve professional relationships.
•Professionalism can be promoted.
•Give economic security.
•Ensure that employees have fair pay, good benefits and safe working conditions.
•Provide power.
•Establish effective channels of communication with decision-makers.
DISADVANTAGE
 Reduced S
individuality.
Disputes are not handled
with individual and
management only.

 Must pay union dues

even if one does
not support unionization.
PROCESS OF COLLECTIVE
BARGAINING
 (1) Prepare
This phase involves composition of a negotiation team.
The negotiation team should consist of representatives of both
the parties with adequate knowledge and skills for
negotiation.
In this phase both the employer’s representatives and the
union examine their own situation in order to develop the
issues that they believe will be most important.
A correct understanding of the main issues to be covered and
intimate knowledge of operations, working conditions
production norms and other relevant conditions is
required.
 (2) Discuss

The parties decide the ground rules that will

guide the negotiations.
An environment of mutual trust and
understanding is also created so that the
collective bargaining agreement would be
reached.
(3) Propose
It involves the initial opening statements and the
possible options that exist to resolve them.
In a word, this phase could be described as
‘brainstorming’. The exchange of messages
takes place and opinion of both the parties is
sought.
 (4) Bargain
Negotiations are easy if a problem solving attitude
is adopted.
This stage comprises the time when ‘what ifs’ and
‘supposals’ are set forth and the drafting of
agreements take place.
(5)Settlement
Once the parties are through with the bargaining
process, a consensual agreement is reached upon
wherein both the parties agree to a common
decision regarding the problem or the issue.
This stage is described as consisting of effective
joint implementation of the agreement through
shared visions, strategic planning and negotiated
change.
Levels of collective
bargaining
 Economy-wide
(national)
Bargaining is a bipartite or tripartite form
negotiation between union confederations, central
of

employer associations and government agencies.

It aims at providing a floor for lower-level
bargaining on the terms of employment, often taking into
account macroeconomic goals.
 (b) Sectoral bargaining:
It aims at the standardization of the terms of
employment in one industry, includes a range of bargaining
patterns.
Bargaining may be either broadly or narrowly defined
in terms of the industrial activities covered and may be either
split up according to territorial subunits or conducted
nationally.

(c) Enterprise Level:

It involves the company and/or establishment.
It emphasizes the point that bargaining levels need not
be mutually exclusive.
 Negotiating the Agreement

Bargaining is negotiation of price alone.

But negotiation may apply to much more than
price, and may not include price at all. However,
all negotiation involves an exchange of value,
and agreements and promises of performance.
Bargaining is often done verbally. Negotiation
often involves written records.
Negotiation:
–Begins with each side presenting initial demands
–Suggests a certain amount of give and take
–Each side does not expect to obtain all demands
presented
 PRERREQUISITES FOR THE
COLLLECTIVE BARGAINING:

1) Right to organize and right to collective bargain

2) Strong and stable trade unions
3) Recognition of trade unions:
4) Attitude of employers and trade unions
5) A suitable framework