Collective Bargaining-Its Relationship to Stakeholders

By Prasad, V. Vijay Durga | Indian Journal of Industrial Relations, October 2009 | Go to article overview
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Collective Bargaining-Its Relationship to Stakeholders


Prasad, V. Vijay Durga, Indian Journal of Industrial Relations


Introduction

Collective bargaining is a means of joint regulation by employers and workers' organisations. Respect of rules depends on the manner of their formulation. Collective bargaining provides the opportunity to formulate rules by mutual consent. Some view the process of collective bargaining as one of unions sharing governance with management. This influences regulation or rule making and results in contract. Several analysts have focused on the economic and political functions of collective bargaining. Some emphasise the eco-nomic functions others highlight the political role of trade unions in collective bargaining. In most cases, the dynamics of economic and political factors and forces together determine the outcomes of collective bargaining. According to ILO, freedom of association and collect-ive bargaining are fundamental rights. Both freedom of association and the right to collective bargaining form an integral part of the ILO Declaration on Funda-mental Principles and Rights at Work.

Collective bargaining is the process in which the terms and conditions of employment are determined jointly by the employer and workers. Like bargaining in the commodity market where the sellers try to sell commodities at higher possible prices, and the buyers seeks to purchase at lower possible prices, in collective bargaining the sellers of labour services, (workers) bargain for obtaining better and improved terms and conditions of employment, and the buyers of these services try to purchase them at lower price as possible. In this process of give-and-take, the final terms are determined on an agreed basis. Collective bargaining emanates from employment relationship. The employer-employee relationship is a pre-condition for collective bargaining. Where there is no such relationship as in the case of self-employed persons or members confined to trade union or an employers' organization, the question of collective bargaining does not arise.

The primary object of collective bargaining is the determination of terms and conditions of employment through negotiations and process of give-and-take. If negotiations succeed the parties arrive at an agreement, which is called 'collective agreement'. In the event of the failure of negotiations, the parties generally take recourse to corrective measures. The agreement arrived at during the course of bargaining may relate to a number of subjects of the terms of employment and working conditions or to only a single issue. As the terms of employment and working conditions have widened during the course of time, so also has the subject matter of collective bargaining. Collective bargaining is confined not only to employer and workers, but the state has also come to play a notable role in regulating various aspects of collective bargaining. Some of these aspects include: selection of bargaining agent, determining the enforceability of collective agreements, obligating the employer and trade unions to bargain collectively and imposing restrictions on industrial actions in the event of failure of negotiations and so on.

The nature of collective bargaining is changing and dynamic. With the changes taking place in technology, economic order, political environment, structure of trade union organizations, ownership of individual enterprises, and role of the government and so on, the various ingredients of collective bargaining are also changing. The pattern of collective bargaining in different countries is not the same nor is collective bargaining at the same stage of development all over the world. The main steps involved in collective bargaining include: presentation in a collective manner to the employer their demands by the employees, discussions and negotiations on the basis of mutual give and take for fulfilling the demands, signing of a formal agreement or arriving at an informal understanding when negotiations result in mutual satisfaction and in the event of the failure of nego-tiations a likely resort to strike or lock out to force the opposite party to come to terms.

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