Collective
Bargaining
MADE BY- SHALINI SINGH
2ND YEAR SEM-4 ROLL NO- MBA195029
Definition and Introduction
Collective bargaining is a process whereby organized labor and management
negotiate the terms and the conditions of employment.
In majority of the cases collective bargaining process deals with issues like:
Rate of wages, pay.
Hours of employment, working conditions
Employment policies
Productivity settlement
Collective bargaining is specifically an industrial relations mechanism or tool, and is an
aspect of negotiation, applicable to employment relationship. As a process, the two are in
essence the same, and the principle applicable to negotiations is relevant to collective
bargaining as well. In collective bargaining the union always has a collective interest
since the negotiations are for the benefit of several employees. Where collective
bargaining is not for one employer but for several, collective interests become a feature
for both parties to the bargaining process. In collective bargaining certain essential
conditions need to be satisfied, such as the existence of freedom of association and a
labor law system. Further, since the beneficiaries of collective bargaining are in daily
contact with each other, negotiations take place in the background of a continuing
relationship which ultimately motivates the parties to resolve the specific issues.
Objectives:-
There are some basic objectives of collective bargaining on that basis whole process
generally work,
these are:
# Settle the conflicts related to working conditions and wages.
# To protect the interest of the workers through collective action.
# To resolve the difference between the workers and management through voluntary
negotiations
and to arrive at a consensus.
# To avoid third party intervention in matters relating to employment.
# Practically speaking any issues that has any relevance to management and workers
becomes the
subject matter of bargaining.
Features:-
Collective
Bargaining power
Flexible
Voluntary
Continuous
Dynamics
Power relationship
Representation
Bipartite Process
Good faith bargaining process
Types of collective bargaining:-
Distributive Bargaining: Distributive bargaining is the most common type
of bargaining and involves zero-sum negotiation. In other words, one side
wins and other side loses. Union employees may try to convince
management that they will strike if they don’t get the wages or working
conditions they desire.
Integrative Bargaining: Integrative bargaining is similar to problem-
solving sessions in which both sides are trying to reach mutually beneficial
alternatives. Both the employer and union try to resolve the conflict to the
benefit of both parties.
Concessionary Bargaining: It involves a union’s giving back to
management some of what it has gained in previous bargaining.
Process of collective bargaining:-
Developing a Bargaining Relationship
One of the very important facets which need to be considered before studying the
process of collective bargaining is “Understanding and developing of a good
Bargaining relationship”. This step consists of these activities mainly:-
1. Recognition of the Bargaining Agent: In those organizations where there is a
single trade union, that union is generally granted recognition to represent the
workers.
2. Levels of bargaining. Collective bargaining is possible at all levels, such as:
At the level of the enterprise,
It may be at the level of the industry in a particular region.
At the level of the entire industry in the country, that is, at the national level.
3. Scope and Coverage of Collective Bargaining: Though in many organizations bargaining
is struck only by specific issues like wage increase, bonus, or seniority, promotion, etc.
4. Process Variation of Collective Bargaining: The negotiation process has been
visualized in different ways. Collective bargaining procedure can be compared with the
similar to an exercise in politics where the relative strength of the parties stems from
decisiveness and that it resembles with a debate.
Preparation for Negotiation
Prior to the actual bargaining sessions, enough care should be taken by both the parties to
have a thorough preparation for the negotiations. This has become a pre – requisite to
collective bargaining in view of several reasons.
Negotiation Stage
Methodology for bargaining is very important in negotiating process. It will help
the negotiator to develop those personal and managerial (administrative) qualities of
preparedness, knowledge, ability, sensitivity, timing, analytical abilities, composure and
patience. These qualities develop as a result of observation, experience involvement and
conscious individual effort and experience.
As a bargaining methodology it is desirable to list all the bargaining items, whether
introduced by the employer or the employee that the parties will consider during
the course of the collective bargaining negotiations. These bargaining items
could be separated into two parts –
# The cost or financial items
# The other for non cost or non financial items.
Management Strategies:
Prior to the bargaining session, management negotiators prepare by developing the
strategies and proposals
they will use. Three major areas of preparation have been identified:
# Determination of the general size of the economic package that the company
anticipates offering
during the negotiations.
Preparation of statistical displays and supportive data that the company will use
during negotiations.
Preparation of a bargaining book for the use of company negotiators, a
compilation of information on issues that will be discussed, giving an analysis
of the effect of each clause, its use in other companies, another fact.
Union Strategies:
Like management, unions need to prepare for negotiations by collecting
information. More and better information gives the union the ability to be more
convincing in negotiations. Since collective bargaining is the major means by
which the union can convince its members that it is effective and valuable, this is a
critical activity.
Collective Agreements
Procedure Agreements: Procedure agreements spell out the steps by
which the industrial relations processes are carried out.
Substantive Agreements: These contain the ‘substance’ of any agreement
on terms and conditions of the employment.
Mixed Procedural/ Substantive Agreements: The distinction between
‘procedural’ and ‘substantive’ agreements while useful, does not always
apply in practice. It is possible to have both ’substantive’ and ‘procedural’
elements in the same agreement.
Collective Bargaining Practices in
India:-
Collective bargaining in India has been the subject matter of industrial
adjudication since long and has been defined by our Law Courts .Collective
bargaining is a technique by which dispute as to conditions of employment is
resolved amicably by agreement rather than coercion. Collective Bargaining
machinery essentially is a reflection of a particular social and political
climate. The history of the trade union movement shows that union is
affiliated to one or the other political parties. As a result most of the trade
unions are controlled by outsiders. Critic says that the presence of outsiders is
one of the important reasons for the failure of collective bargaining in India.
Summary:-
Collective bargaining emerged initially has been purely Metter between the plant
level union and the plant management. The negotiations either at the state or at the
industry level are yet not frequent. The collective bargaining has not decentralized
beyond the plant level because crafts unions are absent. There are three important
reasons as to why collective bargaining has not gone beyond the plant level: a) the
varying sizes not permit uniform employment conditions; b) the absence of
homogeneous labor market owing to lack of uniform skills and pattern of training
which does not promote free mobility of labor market owing to lack of uniform
skills and pattern of training which does not promote free mobility of labor so that
uniform employment conditions could be evolved for the industry as a whole. c) the
plant union leadership which at present enjoys enormous powers and faces prospects
of political climb is reluctant to get integrated into an industry wise union where its
power are likely to be restricted.
References Books:-
Mamoria C.B.(2008); “ Dynamics of Industrial Relations”;
Himalaya Publishing House, Mumbai.
- Webb, Sydeny and Beatrice,(1902); “ Industrial Democracy”
;p.185.
- Richardson,J.H,(1964) “An Introduction to the study of industrial
relations”; p.22.
- Dunlop,John J.,(1954) “Challenges to collective Bargaining”p.170-
174.
- ILO;”Collective Bargaining”.p.70.
