Role of collective bargaining in industrial relationship

Collective bargaining and labour relations (Collective bargaining and labour relations)

role of collective bargaining in industrial relationship

Collective bargaining is a process of negotiation between employers and a group of employees A collective agreement functions as a labour contract between an employer and one or more The term "collective bargaining" was first used in by Beatrice Webb, a founder of the field of industrial relations in Britain. more important role, including the development of tripartite consultative mechanisms. Context of industrial relations and collective bargaining in China: . Importance Of Collective Bargaining: Collective bargaining develops a sense of bargaining is, essentially, a recognized way of creating a system of industrial.

Why Is Collective Bargaining A Hallmark of Industrial Relations? | cypenv.info

It aims to acquire a large measure of economic and political control over crucial decisions in the area of its most immediate interest and to be recognized in other areas of decision making.

Collective bargaining has no final form. It adapts- itself to the changing social, legal and economic environment.

role of collective bargaining in industrial relationship

It has varied considerably from plant to plant and industry to industry, and also between and within unions. For example, a number of industrial unions have successfully bargained for higher bonus and Provident Fund benefit, why many unions in the construction industry have ignored these goals.

Bargaining in some plants is characterized by comparatively frequent strikes, whereas in other plants there are long records of uninterrupted industrial peace. Wage corners have enhanced their social and economic position in absolute terms and in relation to other groups and at same time, management has retained a large measure of power and dignity. These gains were not registered in one great revolutionary change, but rather step by step, with each clash between the opposing parties settled with a new compromise somewhat different from the previous settlement.

In short, collective bargaining accomplishes long-run stability on the basis of day-to-day adjustments in relation between labor and management. Collective bargaining may be viewed as a struggle between two opposing forces with the outcome depending on their relative strength.

role of collective bargaining in industrial relationship

The inherent strength of each side is its ability to withstand a strike. This is partly an economic matter: Sometimes, it is a matter of differing interpretations of specific clause in the contract, sometimes; it is a question of whether the dispute is even covered by the contract.

Nevertheless, each case must somehow be settled. The spirit of the contract should not be violated. Enforcement of the Agreement: Proper and timely enforcement of the contract is very essential for the success of collective bargaining.

If a contract is enforced in such way that it reduces or nullifies the benefits expected by the parties, it will defeat basic purpose of collective bargaining. It may give rise to fresh industrial disputes.

Hence, in the enforcement of the contract the spirit of the contract should not be violated. However, new contracts may be written to meet the problems involved in the previous contract.

Furthermore, as day-to-day problems are solved, they set precedents for handling similar problems in future. Such precedents are almost as important as the contract in controlling the working conditions. In short, collective bargaining is not an on-and-off relationship that is kept in cold storage except when new contracts are drafted. Theories of Collective Bargaining: There are three important concepts on collective bargaining which have been discussed as follows: The Marketing Concept and the Agreement as a Contract: The marketing concept views collective bargaining as a contract for the sale of labour.

It is a market or exchange relationship and is justified on the ground that it gives assurance of voice on the part of the organised workers in the matter of sale. The same objective rules which apply to the construction of all commercial contracts are invoked since the union-management relationship is concerned as a commercial one.

According to this theory, employees sell their individual labour only on terms collectively determined on the basis of contract which has been made through the process of collective bargaining.

The uncertainty of trade cycles, the spirit of mass production and competition for jobs make bargain a necessity. It enabled him to resist the pressure of circumstances in which he was placed and to face an unbalanced and disadvantageous situation created by the employer. The object of trade union policy through all the maze of conflicting and obscure regulations has been to give to each individual worker something of the indispensability of labour as a whole.

It cannot be said whether the workers attained a bargaining equality with employers. But, collective bargaining had given a new- relationship under which it is difficult for the employer to dispense without facing the relatively bigger collective strength.

The Governmental Concept and the Agreement as Law: The Governmental Concept views collective bargaining as a constitutional system in industry. It is a political relationship. The union shares sovereignty with management over the workers and, as their representative, uses that power in their interests.

The application of the agreement is governed by a weighing of the relation of the provisions of the agreement to the needs and ethics of the particular case. The contract is viewed as a constitution, written by the point conference of union and management representative in the form of a compromise or trade agreement. The agreement lays down the machinery for making executing and interpreting the laws for the industry. The right of initiative is circumscribed within a framework of legislation.

Whenever, management fails to conform to the agreement of constitutional requirements, judicial machinery is provided by the grievance procedure and arbitration. This creates a joint Industrial Government where the union share sovereignty with management over the workers and defend their group affairs and joint autonomy from external interference. The industrial relations concept views collective bargaining as a system of industrial governance.

It is a functional relationship. Group Government substitutes the State Government. The union representative gets a hand in the managerial role. Discussions take place in good faith and agreements are arrived at. The union joins with company officials in reaching decisions on matters in which both have vital interests.

Thus, union representatives and the management meet each other to arrive at a mutual agreement which they cannot do alone. To some extent, these approaches represent stage of development of the bargaining process itself.

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  • Importance of Collective Bargaining in Industrial Relations

Early negotiations were a matter of simple contracting for the terms of sale of labour. Developments of the latter period led to the emergence of the Government theory. The industrial relations approach can be traced to the Industrial Disputes Act of in our country, which established a legal basis for union participation in the management.

Importance of Collective Bargaining: The collective bargaining advances the mutual understanding between the two parties i. The role of collective bargaining may be evaluated from the following point of view: The main object of the organisation is to get the work done by the employees at work at minimum cost and thus earn a high rate of profits.

Maximum utilization of workers is a must for the effective management. For this purpose co-operation is required from the side of the employees and collective bargaining is a device to get and promote co-operation. The labour disputes are mostly attributable to certain direct or indirect causes and based on rumors, and misconceptions.

Collective bargaining is the best remedial measure for maintaining the cordial relations. Labour has poor bargaining power. Individually a worker has no existence because labour is perishable and therefore, the employers succeed in exploiting the labourers. The working class in united form becomes a power to protect its interests against the exploitation of the employers through the process of collective bargaining.

role of collective bargaining in industrial relationship

The collective bargaining imposes certain restrictions upon the employer. Unilateral action is prevented. All employees are treated on equal footings. The conditions of employment and rates of wages as specified in the agreement can be changed only through negotiations with labour.

Employer is not free to make and enforce decisions at his will.

COLLECTIVE BARGAINING Industrial Relations Management

Collective bargaining can be made only through the trade unions. Trade unions are the bargaining agents for the workers.

The main function of the trade unions is to protect the economic and non- economic interests of workers through constructive programmes and collective bargaining is one of the devices to attain that objective through negotiations with the employers, Trade unions may negotiate with the employer for better employment opportunities and job security through collective bargaining.

Government is also concerned with the process of collective bargaining. Government passes and implements several labour legislations and desires it to be implemented in their true sense. If any person violates the rules and laws, it enforces them by force. Collective bargaining prevents the Government from using the force because an amicable agreement can be reached between employer and employees for implementing the legislative provisions. Labour problems shall be minimised through collective bargaining and industrial peace shall be promoted in the country without any force.

Collective bargaining is a peaceful settlement of any dispute between worker and employers and therefore it promotes industrial peace and higher productivity resulting an increase in the Gross National Product or the national income of the country. Main Hindrances for Collective Bargaining: The main objective of developing collective bargaining technique is to improve the workers-management relations and thus maintain peace in industries.

The technique has developed in India only after India got independence and got momentum since then. The success of collective bargaining lies in the attitude of both management and workers which is actually not consistent with the spirit of collective bargaining in India.

There are certain problems which hinder the growth of collective bargaining in India. The following factors or activities act as hindrances to effective collective bargaining: Collective bargaining is generally becoming a competitive process, i. Both the parties—management and workers—come to the negotiation table without doing their homework.

To start with, there is often a kind of ritual, that of charges and counter charges, generally initiated by the trade union representatives.

Why Is Collective Bargaining A Hallmark of Industrial Relations?

In the absence of requisite information, nothing concrete is achieved. But in a period of recession, when demand of the product and the profits are falling, it is very difficult for the employer to meet the demands of the workers, he might even resort to retrenchment or even closure collective bargaining is no answer to such a situation.

This type of bargaining is also known as cooperative bargaining. This involves shaping and reshaping some attitudes like trust or distrust, friendliness or hostility between labor and management.

When there is a backlog of bitterness between both the parties, attitudinal restructuring is required to maintain smooth and harmonious industrial relations. It develops a bargaining environment and creates trust and cooperation among the parties.

It generally aims at resolving internal conflicts. This is a type of maneuvering to achieve consensus with the workers and management. Even within the union, there may be differences between groups. For example, skilled workers may feel that they are neglected or women workers may feel that their interests are not looked after properly.

Within the management also, there may be differences. Trade unions maneuver to achieve consensus among the conflicting groups. Collective bargaining consists of negotiations between an employer and a group of employees that determine the conditions of employment.

Often employees are represented in the bargaining by a union or other labor organization. The result of collective bargaining procedure is called the collective bargaining agreement.

Collective agreements may be in the form of procedural agreements or substantive agreements. Procedural agreements deal with the relationship between workers and management and the procedures to be adopted for resolving individual or group disputes.

Collective Bargaining

This will normally include procedures in respect of individual grievances, disputes and discipline. Frequently, procedural agreements are put into the company rule book which provides information on the overall terms and conditions of employment and codes of behavior.

A substantive agreement deals with specific issues, such as basic pay, overtime premiums, bonus arrangements, holiday entitlements, hours of work, etc. In many companies, agreements have a fixed time scale and a collective bargaining process will review the procedural agreement when negotiations take place on pay and conditions of employment. The collective bargaining process comprises of five core steps: This phase involves composition of a negotiation team.

The negotiation team should consist of representatives of both the parties with adequate knowledge and skills for negotiation. The first thing to be done is to determine whether there is actually any reason to negotiate at all.

A correct understanding of the main issues to be covered and intimate knowledge of operations, working conditions, production norms and other relevant conditions is required. Here, the parties decide the ground rules that will guide the negotiations. A process well begun is half done and this is no less true in case of collective bargaining. An environment of mutual trust and understanding is also created so that the collective bargaining agreement would be reached.

This phase involves the initial opening statements and the possible options that exist to resolve them.