Collective Bargaining

Trade Unions

A Presentation by Atul Chanodkar

Trade Union
A union is an organization of workers, acting collectively, seeking to promote
and protect its mutual interests through collective bargaining. However,
before we can examine the activities surrounding the collective bargaining
process, it is important to understand the laws that govern the labor–
management process, what unions are, and how employees unionize.

A union is a formal association of workers that promotes the interests of its

members through collective action. The very existence of unions depends
upon laws and legal action
Why Employees Join Unions
Higher Wages and Benefits
The power and strength of numbers sometimes help unions obtain higher
wages and benefit packages for their members than employees can negotiate
individually. One or two employees walking off the job over a wage dispute is
unlikely to significantly affect most businesses, but hundreds of workers going
out on strike can temporarily disrupt or even close down a company.
Additionally, professional bargainers employed by the union may negotiate
more skillfully than any individual could on his or her own behalf.

Greater Job Security

Unions provide their members with a sense of independence from
management’s power to arbitrarily hire, promote, or fire. The collective-
bargaining contract will stipulate rules that apply to all members, thus
providing fairer and more uniform treatment.
Why Employees Join Unions
Influence Over Work Rules
Where a union exists, workers can help determine the conditions under which
they work and have an effective channel through which they can protest
conditions they believe are unfair. Therefore, a union not only represents the
worker but also provides rules that define channels in which worker complaints
and concerns can be registered. Grievance procedures and rights to third-party
arbitration of disputes are examples of practices typically defined and regulated
as a result of union efforts.

Compulsory Membership
Many labor agreements contain statements commonly referred to as union
security arrangements. When one considers the importance of security
arrangements to unions—importance related to numbers and guaranteed
income—it is no wonder that such emphasis is placed on achieving a union
security arrangement that best suits their goals. Such arrangements range from
compulsory union membership to giving employees the freedom in choosing to
join the union.
Factors Leading to Employee Unionization
Collective Bargaining
Collective bargaining typically refers to the negotiation, administration, and
interpretation of a written agreement between two parties that covers a specific
period of time. This agreement, or contract, lays out in specific terms the
conditions of employment - that is, what is expected of employees and any limits
to management’s authority. In the following discussion, we take a somewhat
larger perspective and also consider the organizing, certification, and preparation
efforts that precede actual negotiation.

Collective bargaining is described as an activity that takes place between two

parties. In this context, the two parties are labor and management.
Collective Bargaining
Collective bargaining is the establishment by negotiation and discussion
of agreement on matters of mutual concern to employers and unions
covering the employment relationship and terms and conditions of
employment. It therefore provides a framework within which the views of
management and unions about disputed matters that could lead to
industrial disorder can be considered, with the aim of eliminating the
causes of the disorder.

Collective bargaining is a joint regulating process, dealing with the

regulation of management in its relationships with work people as well as
the regulation of conditions of employment. It has a political as well as
an economic basis – both sides are interested in the distribution of power
between them as well as the distribution of income.
Collective Bargaining
Collective bargaining can be regarded as an exchange relationship in which wage–
work bargains take place between employers and employees through the agency
of a trade union. Traditionally, the role of trade unions as bargaining agents has
been perceived as being to offset the inequalities of individual bargaining power
between employers and employees in the labour market.

Collective bargaining can also be seen as a political relationship in which trade

unions, as Chamberlain and Kuhn (1965) noted, share industrial sovereignty or
power over those who are governed, the employees. The sovereignty is held jointly
by management and union in the collective bargaining process.

Above all, collective bargaining is a power relationship that takes the form of a
measure of power-sharing between management and trade unions (although
recently the balance of power has shifted markedly in the direction of
management).
Collective Bargaining
Collective bargaining involves the following main features:

 Parties – at least two sides;

 An agreed procedure whereby the parties relate to each other – and the
negotiation of framework agreements and consultation;
 Outcomes – a collective agreement;
 The existence of sanctions designed to change the attitude or position of
the other party.
Collective Bargaining
Management’s representation in collective-bargaining talks tends to depend on
the size of the organization. In a small firm, for instance, bargaining is probably
done by the president. Few small firms have a specialist who deals only with HRM
issues; the president of the company often handles this task. Larger organizations
usually have an HRM department with full-time industrial relations experts. In
such cases, we can expect management to be represented by the senior manager
for industrial relations, corporate executives, and company lawyers—with support
provided by legal and economic specialists in wage and salary administration,
labor law, benefits, and so forth.

On the union side, we typically expect to see a bargaining team composed of an

officer of the local union, local shop stewards, and some representation from the
international/ national union. Again, as with management, representation is
modified to reflect the size of the bargaining unit.
Process of Collective Bargaining
Collective Bargaining
Trade Unions

A Presentation by Atul Chanodkar