Illustrate different forms of collective bargaining. Discuss the different collective agreements.
“Collective bargaining typically refers to the negotiation, administration and interpretation of written agreement between two parties that covers a specific period of time (DeCenzo & Stephen, 2010, p. 351)”
“Collective bargaining is a joint regulating process, dealing with the regulation of management in its relationship with work people as well as the regulation of conditions of employment. (Armstrong, 2012, p. 414)”
We can term collective bargaining as the negotiation of written agreement with the work people that clarifies all the regulation and conditions of employment for a pre-stated period of time.
Forms of collective bargaining as mentioned by Walton and McKersie (1965) (extracted from Armstrong 2012) mentions two forms of collective bargaining as distributive and integrative. The former one deals with bargaining style where one party tries to get the most out of the bargaining by outsmarting or overpowering the other party. Where as in integrative bargaining the two parties try and find a mutual agreement for the benefit of both. “Integrative bargaining (also called "interest-based bargaining, win-win bargaining") is a negotiation strategy in which parties collaborate to find a win-win solution to their dispute. Spangler (2003)”
Chamberlain and Kuhn (1965) (extracted from Armstrong 2012) also gives two forms of collective bargaining. The forms are defined as conjunctive and cooperative bargaining. The conjunctive bargaining is similar to distributive bargaining where one tries to over gain the other. Their try to win over the other with various methods. Similarly the cooperative bargaining is similar to integrative bargaining where both the parties try to find a win-win situation for both sides.
Types of collective bargaining agreements are new style agreement, partnership agreement, substantive agreements, procedural agreements and single union deals.
New style agreement: The new style agreement was formed to promote cooperative solution to any disputes in the future. Any labour disputes in the future will be subjected to the norm and guidelines that have be pre stated in the agreement between the parties beforehand. This agreement type has incorporated policies such as no strike and recognized only one union. The underlining objective of this agreement is to solve any grievances without affecting the overall output of the organization.
Partnership agreement: This is a type of integrative or cooperative bargaining where both parties will mutually place their offer on the table and decide on the agreement that benefits both. The relation between employer and employee are strengthened in this agreement and team work is built on trust. “Management may offer job security linked to productivity and the union may agree to more flexible working. (Armstrong, 2012, p. 416)”
Substantive Agreement: This agreement has pre-stated agreed terms and condition for type of jobs, payment, working hours, holidays, leave, extra benefits for medical, etc. This can be related to the agreement that we have in our jobs where all rules, guidelines and policies are signed in the agreement before hand.
Procedural Agreement: The procedural agreement is similar to substantive agreement. Procedures for disputes that can occur in the future is written and freely agreed by both the parties. The terms and conditions however may not be legally enforceable but depends on the ethical aspect of both parties.
Single Union Deals: Single union deal as the name suggests agrees on one single union to represent all the employees. The union work for the balancing of terms and conditions of both the blue and white collar job holders. The terms also agree with dealing with disputes through negotiation and not conducting strikes or hampering the production of the company.
Armstrong, M. (2012). ARMSTRONG’S HANDBOOK OF HUMAN RESOURCE MANAGEMENT PRACTICE (12 Ed ed.). London: Kogan Page.
DeCenzo, D. A., & Stephen, P. R. (2010). Collective Bargaining. In S. R. David A DeCenzo, Fundamentals of Human Resource Management (pp. 350-353). United States of America: John Wiley & Sons Inc.
Spangler, Brad. "Integrative or Interest-Based Bargaining." Beyond Intractability. Eds. Guy Burgess and Heidi Burgess. Conflict Information Consortium, University of Colorado, Boulder. Posted: June 2003 <http://www.beyondintractability.org/essay/interest-based-bargaining>.
Collective bargaining as the name suggest involves of bargaining as a group. This involves of bargaining for improvement of the work environment, increased wage, and availability of overtime, facilities and things like that with the employer regarding the workplace. The aim of doing a collective bargaining is to have a collective agreement and to resolve any dispute interests (Kochan, 2012).
As per Walton and McKersie there are two forms of collective bargaining which is distributed bargaining and integrative bargaining. Distributed bargaining is a bit complex system as the position of both employer and the union (employee’s representative) is something like “We/I can’t go beyond this point, We/I can’t do more than this percentage”. Here, the interest opposes and both parties wants as much as they can get from the deal. The motivation here is often to create a winning situation for oneself and loosing for the other party. While, the other form of collective bargaining they listed in integrative bargaining is completely different as it tries to create a win-win situation and the interest of both parties are congruent. The goal here is to expand the deal and show flexibility at both end such that both parties can be satisfied. Here the focus is more on asking question on why a certain issue is important and finding common interest point (Walton & MacKersie, 1995).
There’s another form of collective bargaining as well as developed by Chamberlain and Kuhn which is conjunctive bargaining and cooperative bargaining. Conjunctive bargaining is also called as distributive bargaining and is a very common type of bargaining. In this form of negotiation, one side wins and the other side loses as both parties try to tilt the deal more on their favor. Whereas in cooperative bargaining both sides try to reach an agreement which is mutually beneficial alternatives to the demands. This form of bargaining creates a win-win situation as both the employee and employer try to resolve the conflict being flexible and in such a way which is in the interest of both the parties involved (Schwarz, Chamberlain & Kuhn, 1987).
Collective agreement evolves after a successful conclusion of collective bargaining. Collective agreement includes of a legally enforceable written contract which is valid for a certain period agreed and is done between the management and employees through representatives. It doesn’t replace an individual employee contract but rather modify or improve the contract in certain way with regard to changes in wage, working hours, working conditions and benefits, overtime and dispute resolution procedure (Addison, Teixeira, Bryson & Pahnke, 2013). There are various different types of collective agreement, few of which are as listed below:
- General Collective Agreements: It includes of an agreement between the employee’s representative and the employer with regard to wages and/or other terms of employment like the working conditions, facilities, holidays, insurance, worktime, and alike.
- Special Collective Agreements: It includes of general collective agreements with additional layer of agreement at a local level by local level unions on different issues such as work shift.
- Enterprise Agreement: For this an example can be taken with regard to different unions formed by the employees of Government of Nepal. Regardless of them having unions at office level and in a local level as well, there’s one in the nation level. And, in addition to that, there’s a different federation which is formed by the inclusion of all the other union representatives. So, in case of such large organization, the federation negotiates on the behalf of all the other trade unions belonging to different occupations to reach on a general collective agreement which covers all the relevant issues.
Addison, J., Teixeira, P., Bryson, A., & Pahnke, A. (2013). Collective Agreement Status and Survivability: Change and Persistence in the German Model. LABOUR , 27 (3), 288-309. http://dx.doi.org/10.1111/labr.12012
Kochan, T. (2012). Collective bargaining: crisis and its consequences for American society. Industrial Relations Journal , 43 (4), 302-316. http://dx.doi.org/10.1111/j.1468-2338.2012.00680.x
Schwarz, J., Chamberlain, N., & Kuhn, J. (1987). Collective Bargaining. Industrial And Labor Relations Review , 40 (3), 444. http://dx.doi.org/10.2307/2523501
Walton, R., & MacKersie, R. (1995). A behavioral theory of labor negotiations . Ithaca: ILR Press.
Collective bargaining is the process of negotiation between employers and a group of employees when certain issues arises aimed at agreements to regulate working salaries, working conditions, benefits, and other aspects of workers’ compensation and rights for workers to secure full time employment. It is a joint regulation process dealing with the regulation of management in its relationship with work place as well as the conditions of employment (Armstrong, 2012).
The different forms of collective bargaining are:
Distributive Bargaining: The distributive bargaining involves zero sum negotiation in which one party tries to win over the others. Both the employers and employees try to maximize their respective gains. It focuses on the attainment of one party’s goals when they are in basic conflict with those of the other party (Walton & McKersie, 1965). It involves the economic issues such as wages, bonus and other benefits. It is also known as conjuctive bargaining. For example, the employees negotiate for increased wages and the employer negotiates for increased productivity at lower wage.
Integrative Bargaining: The integrative bargaining involves negotiating on mutually agreed terms with respect to working terms. It focuses on gain of either parties or at least tries to make sure that no one loses. It can be compared to problem solving technique where both the parties share information and create possible solutions. It recognizes that each party is interdependent on the other and can achieve its objectives more effectively if it wins support of others (Chamberlian & Kuhn, 1965). It is also referred to as cooperative bargaining. For example, the employees may agree to work on lower wages if the systems are updated.
Productivity Bargaining: The productivity bargaining relates incentives with the productivity. Higher the productivity, higher will be the incentive and vice-versa. It will encourage the employees to work harder and push their limits to get additional benefits. Both the parties can enjoy benefits in the terms of increased productivity and increased pay.
Composite Bargaining: The composite bargaining tries to reach to mutual agreement with respect to employment terms and enjoy long-term relationship with each other (Business Jargons, n.d.). The workers will still bargain for higher wages but will also pay attention to working conditions and policies.
Concessionary Bargaining: Concessionary bargaining is about giving back to the management some of what has been gained in earlier bargaining. A good example is the agreement between General Motors & the International Union of Electric Workers that granted GM around the clock operations, wages and benefits concessions for the new hires and a two-week mass vacation (LinkedIn Learning, 2013).
Collective agreements are the outcome of collective bargaining that regulates the terms and conditions of employees in the workplace. The different collective agreements are:
- Substantive Agreement: The substantive agreement is legally enforceable agreement that covers the basic terms and conditions of employment like pay, allowances, working hours, overtime, holidays, flexibility arrangements and achievement of single status. It helps in harmonization of terms and conditions between the employer and employees.
- Procedural Agreement: The procedural agreement aims on regulating the behavior of the parties involved in the agreement and it is not legally enforceable. It includes agreement about the methods to be used and procedures/rules to be followed that can vary widely depending on the nature of the organization.
- Single-Union Deals: The single union deals argue that there should be a single body to represent all employees. It emphasizes on flexible working practices and harmonization of terms and conditions between manual and non-manual employees.
- New-Style Agreements: The new style agreements involves provision for single union recognition, single status, labor flexibility, company council and no-strike clause. It advocates that negotiation should be based on mutually accepted rights of the parties.
- Partnership Agreements: In partnership agreement, both parties agree on achieving co-operative climate and less adversarial industrial relations. It encourages collaboration for mutual advantage.
- Disruption Resolution: Disruption resolution is the agreement about resolving the differences between management and trade unions. Depending on the nature of disputes, the conciliation, arbitration and mediation methods are used to address the organizational issues.
Armstrong, M. (2012). Armstrong’s Handbook of Human Resource Management Practice. London: Kogan Page.
Business Jargons. (n.d.). Types of Collective Bargaining . Retrieved from Types of Collective Bargaining: https://businessjargons.com/types-of-collective-bargaining.html
Chamberlian, N. W., & Kuhn, J. (1965). Collective Bargaining. New York: McGraw Hill.
LinkedIn Learning. (2013, March 16). Types of Collective Bargaining . Retrieved from Types of Collective Bargaining: https://www.slideshare.net/mahashmi/types-of-collective-bargaining
Walton , R. E., & McKersie, R. B. (1965). Behavioural Theory of Labour Negotiations. New York: McGraw Hill.
Collective Bargaining in simple terms is the ‘process of negotiation’ of wages, working hours, working conditions and other conditions of employment by a Labor or Trade Unions. According to the Legal Dictionary ( n.d.), “Collective bargaining is the negotiation process that takes place between an employer and a group of employees when certain issues arise.” We can take the example of Birgunj Sugar Mill which closed down by not paying the wages of the workers. Now after three years of closed down, the government has finally decided to reopen by signing the agreement, which states of paying all the unpaid salaries to workers. These trade unions can be part of any political party.
Collective bargaining has served as a cornerstone institution for democracy, a mechanism for increasing workers’ incomes, improving working conditions and reducing inequality, a means for ensuring fair employment relations and a source of workplace innovation (Susan Hayter, Vol 53, Issue 2, 2011). There are different forms of collective bargaining made by different scholars:
Conjunctive or Distributive Bargaining
Distributive bargaining is used when the firm or parties are trying to distribute something. The employee and employer both are trying to increase their gains. In this form of collective bargaining, employee wishes employee wishes to have an increased wage or bonus for his work done, whereas the employer wishes to increase the workload and reduce the wages (Business Jargons, n.d.).
Co-operative or Integrative Bargaining
In this form of Co-operative bargaining, both the parties sit together and discuss the matters in order to solve their problems and reach a common point. Under this, the matter is not in the control of the employers or employees like the recession or any other occurrence of natural calamities. For example, in the 2001 recession, the GDP growth did not return to 3 per cent until quarter three, 2003 (The Balance, 2018).
A collective agreement is a written contract between the employer and a union that outlines many of the terms and conditions of employment for employees in a bargaining unit (Human Resources, 2011). In this, the trade union give notice of bargaining within the 90 days before the current agreement. The conditions in a collective contract are already discussed in collective bargaining, the collective agreement includes wages, job postings, responsibilities of an employer, employee and the trade union including their benefits.
The different collective agreements include the following:
Under the substantive agreements, the basic matters of employment such as pay, allowances, holidays, overtime, working hours, etc., are covered which helps the employee and employer both if a certain issue occurs in the future. For example, One of my colleagues took a leave of 15 days while in her agreement with the office she was access to taking 18days of leave. But the head of the department cut off her salary for taking extra holidays. At such case, she with the help of the appointment letter talked to the head and saved her cut off salary.
This agreement sets the procedure and rules to be followed in case of any disputes occur between the employer and employee. The main purpose of this agreement is to regulate the behaviour of both the parties according to the agreement. This type of agreement depends upon the size and operations of the firm. Small firms may have limited agreement while big firms have lots of procedures.
This agreement or deal states that there should be a single trade union representing the employees or workers in the firm. This helps to maintain harmonization and flexible work practices between both the parties. In this type of deals, the former agrees to recognize the one union to represent the employee rather than having three or four representatives.
New style agreements
The new style agreement emerged in 1990s based on the mutually accepted rights of the parties. According to this agreement, the negotiation and disputes should be resolved based on the ‘rights’of both the parties.
Conciliation is a type of bank reconciliation system in which a third party from the outside act as a counsellor in resolving the disputes and agree on one common term among the employer and employees.
Arbitration is done if both the parties could not come to common terms and the disputes among them do not resolve. In this situation, a third person from the outside is called to observe on what condition the parties are not agreeing. Usually, ACAS officials in the UK take the arbitrator role.
Business Jargons. (n.d.). Business jargons. Retrieved from Types of Collective Bargaining: https://businessjargons.com/contact-us
Human Resources. (2011, August). Uoguelph.ca. Retrieved from Labor realtions- Frequently asked Questions: https://www.uoguelph.ca/hr/system/files/Labour%20Relations%20FAQs.pdf
Legal Dictionary. (n.d.). Collective Bargaining. Retrieved from Collective Bargaining: https://legaldictionary.net/collective-bargaining/
Susan Hayter, T. F. (Vol 53, Issue 2, 2011). Journal of Industrial Relations. SAGE Journals.
The Balance. (2018, March 25). GDP and Growth. Retrieved from What is a Recession? Examples, Impacts, Benefits: https://www.thebalance.com/what-is-a-recession-3306019