Collective Bargaining

Collective Bargaining 1

Definition Beatrice and Sidney Webb defined collective bargaining as: 

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one method whereby trade unions could maintain and improve their members’ terms of employment Accordingly collective bargaining is a trade union initiated process If employees didn’t form unions and make demands the bargaining process would not have happened 2

Definition Definition 

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The prime aim for unions is to improve wages & conditions of employment This definition however fails to discuss the interactive nature of the process and its central position in labour relations Collective bargaining is a two way process and the pressure to negotiate comes from both sides

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Definition 

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Collective bargaining is the principle method whereby employers and employees establish and continue a relationship This is an important means of communication which Allows the two sides to get together and talk about problems, needs, goals and to settle differences

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Definition 

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An alternative definition: “ a method of determining the terms and conditions of employment and regulating the employment relationship between representatives of management and employees with the intention to reach an agreement which may be applied to a group of workers. This definition is used by Salamon.

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Collective Bargaining Commonality of interest as a basis for bargaining: 

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Bargaining would not take place if there was no common interest to bargaining Parties work together to produce goods and services Together they work for the long term future of the of the company Bargaining is based on pluralism Both parties recognise each others right to exist

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Collective Bargaining The role of conflict in bargaining: 

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Bargaining would not occur if there was no conflict Parties have different needs, goals, interests, attitudes, values and perceptions These goals are pursued at the costs of the other party If parties have sufficient power then they use collective bargaining as a way forward

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Collective Bargaining Role of conflict: 

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The agreement to bargain does not negate or eliminate conflict Conflict should not be seen as dysfunctional leading to destruction Instead many see conflict as leading to innovation and change to bring about improvement in an organisation

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Collective Bargaining Sources of conflict are:  

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Scarcity of resources: availability of money Incompatibility of goals, needs and interests Different attitudes to work Ambiguity in responsibilities and roles Poor organisational structure Poor communication

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Collective Bargaining Sources of conflict  Most important over: wages and salaries  Management has to see to shareholder profits and workers want more money  Productivity needs may force the firm to operate different work practices and the unions might resist this  Companies might want to dismiss inefficient workers and the union would resist this, demanding job security

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Collective Bargaining 

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Employees might demand shorter working hours, longer vacation leave and more time off for training Employees might insist on stricter health and safety controls which would be expensive for the company Employers demand loyalty to the firm whereas employees see it as the individual right to change jobs when the opportunity arises 11

Collective Bargaining 

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These are the issues that are brought to the bargaining table Both parties realise the need to handle conflict effectively These include the day to day activities of the organisations Conflict is thus not confined to the bargaining table

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Collective Bargaining Power regulated the bargaining process: 

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If one party has more power it will override the interest of the other party Historically management has had more power than the workers

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Collective Bargaining Power: 

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Management's sources of power is their ownership and/or control over the firm Workers power comes from their ability to withhold labour collectively - strikes On an individual level workers hold very little power and its only in trade unions that they have power

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Collective Bargaining Power:  

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The law defines the parameter of power The legality of the use of the strike can ensure that workers have power, making strikes illegal takes power away from workers Having the power of the collective makes trade unions powerful since they can stop the production process Power somewhat weakened by no work no pay

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Collective Bargaining 

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Once a bargaining relationship has been established both parties will bring their power to the bargaining table Employers can withhold work opportunity by locking out workers and this way they do not receive any wages The ability to hire casual labour during strike action can give employers power

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Collective Bargaining Establishing a bargaining relationship: 

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Employment contract, whereby employer and employee agree on wages and conditions of employment Unions then demand recognition from management. This formalises management union relationship A bargaining relationship is established when management and union formally agree to enter into negotiations 17

Nature of C.B A power game A rational process where conflicting interests are reconciled A forum where unions go to “collect” and Management goes to “bargain”

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Collective Bargaining Bargaining styles: 

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Distributive bargaining: this is the most common type Management and unions are in opposing positions and gain for one is a loss for another Antagonism dominates the bargaining items These would be around wages and conditions of employment

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Collective Bargaining In distributive bargaining power is used as part of the strategy and tactics on both side Each party strives towards an outcome that is favourable to its own side Both parties are thus assessing strengths and weaknesses on both sides Both parties are looking to how much they can push the other party Each party assesses its ability to withstand being pushed

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Collective Bargaining Bargaining styles: 

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Integrative Bargaining: This is when both parties want a successful outcome and there is a genuine desire to solve a problem In integrative bargaining items are seen as problems that need resolving Integrative bargaining strives for a win –win situation Conflict is minimised

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Bargaining Styles Matters dealt with include: job security, procedures, promotions, benefits and institutional security Problems like retrenchment and promotions are dealt with jointly and one party does not impose its view on the other party Both parties identify and recognise the problem and search for solutions through exploring alternatives

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Collective Bargaining Bargaining Structure:  

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Refers to bargaining units and bargaining levels Bargaining unit is the employees that will be covered by the agreement Bargaining level refers to whether bargaining will take place on a decentralised or a more centralised level Bargaining structure determines which employees are covered by an agreement

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Collective Bargaining Types of bargaining structures 

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Narrow decentralised units: when a union represents the interest of one group of workers at a particular plant Broad decentralised units: Unions of several unions combine to form one bargaining unit represent different sets of employees

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Collective Bargaining Bargaining structures: 

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Narrow centralised units:when a union or several unions representing a particular sector at a company or industry, or different industries bargain centrally Broad decentralised units: a union or a number of unions represent diverse interests bargain with a number of employees in an industry

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Collective Bargaining Outcomes: 

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The outcome of a collective bargaining process is an agreement There is usually an agreement to bargain regularly over wages and other conditions of employment Agreement can stipulate a time factor to the agreement, for e.g. wage increase for one year only or for a number of years

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Outcomes All agreement are enforceable by law. All parties are bound to the terms and conditions set out in the agreement. While parties cannot withdraw from and agreement, clauses can be inserted to allow for conditional withdrawal.

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