What are the effects of collective bargaining?

SYNOPSIS: POINTS: 1. Define collective bargaining. 2. Using diagrams show how collective bargaining may lead to a wage claim being settled quickly, not at all, only after a long time, with a strong union, with a weak union. 3. The effects: o Pay differentials - approximately 8% between those in unions and those not BUT the advantage may be obtained through district, local and company bargaining rather than industry-wide settlements. o Collective bargaining may reinforce the unions view that it has certain rights which have been established to protect jobs and/or earnings. Brief mention should be made of: Closed shop Minimum manning levels Demarcation rules Seniority principles The right to strike (GCHQ notwithstanding) To a monoponistic market a trade union may be able to raise wages AND employment (illustrate with a diagram). o On a wider scale you should show how strike action may adversely affect economic growth, inflation, unemployment and the Balance of Payments although the dockers strike may actually have reduced imports therefore reducing our Balance of Payments deficit. Most strikes are local affairs concerned with plant level issues. Pay and working conditions may be improved but these affects do not often diffuse through industry. Strikes may act as a pressure release leading later to higher productivity. In addition, a short term strike may help management remove surplus stock. Strikes may also win or lose elections!! One final point: it would be wrong to assume that union members receive higher wages simply because they are in a union. Union labour may be higher quality than non-union; employers may raise the wage of non-union labour to keep unions out; income policies may affect the union/non unions pay differential.

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