Collective Bargaining Faculty GP Capt (DR.) RM Saxena

Chapter 5
Collective Bargaining
Faculty
Gp Capt (Dr.)RM Saxena
COLLECTIVE BARGANING
Introduction:-
In the beginning, groups or individual workers would go to their
employers & present their demands & grievances. Thereafter, it
was up to employer to take note of their problems & to act upon
them. Strike was an unlawful activity, liable to prosecution.
The pattern of growth of collective bargaining began from local
bargaining at plant level to region –cum –industry level& finally
national level bargaining.
This pattern gave a systematic push to employers to organise
themselves & has in many cases led to collective bargaining
between employers organisation & employees
organisations(Trade Unions)
MEANING;-
Collective bargaining is a process between employers
and employees to reach an agreement regarding the rights and
duties of people at work.
Collective bargaining aims to reach a collective
agreement which usually sets out issues such as employees
pay, working hours, training, health and safety, and rights to
participate in workplace or company affairs.
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.
OBJECTIVES OF COLLECTIVE BARGAINING
 Collective bargaining has benefits not only for the present, but also
for the future.
The objectives of collective bargaining are:
 1. To provide an opportunity to the workers, to voice their problems
on issues related to employment.
 2. To facilitate reaching a solution that is acceptable to all the parties
involves.
 3. To resolve all conflicts and disputes in a mutually agreeable
manner.
 4. To prevent any conflict/disputes in the future through mutually
signed contracts.
 5. To develop a conductive atmosphere to foster good organizations
relations.
 6. To provide stable and peaceful organization relations.
 7. To enhance the productivity of the organization by preventing
strikes lock – out ect.
CHARACTERSTICS OF COLLECTIVE BARGAINING
 It is a group process, wherein one group, representing the employers, and the
other, representing the employees, sit together to negotiate terms of
employment.
 2. Negotiations form an important aspect of the process of collective bargaining
i.e., there is considerable scope for discussion, compromise or mutual give and
take in collective bargaining.
 3. Collective bargaining is a formalized process by which employers and
independent trade unions negotiate terms and conditions of employment and the
ways in which certain employment-related issues are to be regulated at national,
organizational and workplace levels
 4.Collective bargaining is a process in the sense that it consists of a number
of steps. It begins with the presentation of the charter of demands and ends
with reaching an agreement, which would serve as the basic law governing
labor management relations over a period of time in an enterprise. Moreover,
it is flexible process and not fixed or static. Mutual trust and understanding
serve as the by products of harmonious relations between the two parties.
 5. It a bipartite process. This means there are always two parties involved in
the process of collective bargaining. The negotiations generally take place
between the employees and the management. It is a form of participation.
 6. Collective bargaining is a complementary process i.e. each party needs
something that the other party has; labor can increase productivity and
management can pay better for their efforts.

 7. Collective bargaining tends to improve the relations between
workers and the union on the one hand and the employer on the
other.
 8. Collective Bargaining is continuous process. It enables industrial
democracy to be effective. It uses cooperation and consensus for
settling disputes rather than conflict and confrontation.
 9. Collective bargaining takes into account day to day changes,
policies, potentialities, capacities and interests
At the bargaining table
• Four possibilities:-
• Total rejection of demands
• Partial rejection
• Management may need time to work out cost
of implications & re-negotiate.
• Agree to consider union demands but
management puts forth counter demands of
its own.
Bargaining Power
• Lindblom suggested that bargaining power
depends on:-
• The tastes, goals & motives of the parties
• Skills of persuasion &coercion
• Competition from other buyers & sellers.
Levels of CB
• Plant level: This is the basic or micro level unit, where
negotiations are conducted between management of plant &
unions of plant. Tatas were pioneers.
• Industry level: Several units in the same industry join together

to form an association which then negotiates with a union of
similar status. The agreements are broader in scope.
• National level: Here terms of reference & scope are much

wider but such agreements are not common in India given
the industry-cum region convention of India.
Principles of Collective
Bargaining(CB)
• For union and management:-
-CB should be an education as well as a bargaining processes.
-There must be mutual confidence and good faith and a desire to
make collective bargaining effective in practices.
-There should be an honest and responsible leadership for only this
kind of leadership will make collective bargaining effective and
meaningful
For the Management
• Management must develop and consistently follow a realistic
labour policy which should be accepted and carried out by its
representatives.
• Management must grant recognition to the trade union without
any reservations and accept it as a constructive force in the
organization
• Management should not wait for the trade union to bring
employee grievance to its notice but should rather create the
conditions so that employee can approach freely.
• Management should deal only with one trade union in the
organization
For Trade union :-
- Trade union leaders should be appreciate the economic
implication of collective bargaining for their demands are
generally met from the income and resources of the organisation .
- Trade union should resort to strikes only when all the other
methods of the settlement of a dispute have failed
-Trade union leaders should not imagine that their only
function is to secure higher wages ,shorter hours of work and better
working conditions for their members
Legal frame work for collective bargaining
Employee have the right to :-
• Form, to join or to assist a labour organisation of their
choice ,
• Bargain collectively through that labour organisation
• Engage in concerted activities in mutual aid .
Protects employees by defining and prohibiting unfair
labour organisation
• Discriminating against employees for engaging in or
refraining from union activities.
• Refusing to bargain with the union that is the lawful
representative of its employees.
Supervisor –dominance
 It shall be an unfair labor practice for an employer to dominate
or interfere with the formation or administration of any
labour organisation or contribute financial or other support to it.
COLLECTIVE BARGAINING PROCESS
Collective bargaining generally includes negotiations between the two
parties (employees‘ representatives and employer‘s representatives).
Collective bargaining consists of negotiations between an employer and a

group of employees that determine the conditions of employment. Often
employees are represented in the bargaining by a union or other labor
organization.
The result of collective bargaining procedure is called the collective

bargaining agreement (CBA).
Collective agreements may be in the form of procedural agreements or

substantive agreements. Procedural agreements deal with the relationship
between workers and management and the procedures to be adopted for
resolving individual or group disputes.
Collective bargaining process comprises five core steps:
 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.
 2. Discuss: the parties decide the ground rules that will guide the
negotiations.
• 3.Propose: this phase could be described as brainstorming‘. The
exchange of messages takes place and opinion of both the parties is
sought.
• 4. Bargain: This stage comprises the time when what ifs’ and
suppositions’ are set forth and the drafting of agreements take place.
• 5. Settlement: This stage is described as consisting of effective joint
implementation of the agreement through shared visions, strategic
planning and negotiated change.

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Chapter 5

labor management relations over a period of time in an enterprise. Moreover,

serve as the by products of harmonious relations between the two parties.

the process of collective bargaining. The negotiations generally take place

between the employees and the management. It is a form of participation.

 6. Collective bargaining is a complementary process i.e. each party needs

management can pay better for their efforts.

• Industry level: Several units in the same industry join together

• National level: Here terms of reference & scope are much

Collective bargaining consists of negotiations between an employer and a

The result of collective bargaining procedure is called the collective

Collective agreements may be in the form of procedural agreements or

 1.Prepare: This phase involves composition of a negotiation team. The

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