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Collective bargaining is the process of representatives of workers and employers engaging in a series of negotiations, often with diplomatic and political maneuvers, to effect a collective agreement toward resolution of any dispute or outstanding issues related to terms and conditions of employment, and rights and responsibilities of workers.
The primary challenges of collective bargaining pertains to ensuring that the principals of both parties agree to the settlement, ensuring that the process addresses core issues, and ensuring the relevance of the settlement in a fast paced business environment that demands constant change.
Image Credit: Wikimedia Commons
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The primary challenges of collective bargaining lies in ensuring “collectivity." The collective bargaining takes place with a group of negotiators representing the management on one side, and another group representing the workers, usually the trade union, on the other side.
Not all employees need be members of the trade union, and not all workers need to subscribe to the demands put forth by the group representing the employees. The biggest challenge in collective bargaining is ensuring consensus among the workers, so that the group representing the workers can negotiate without distraction of conflicting and divergent demands made by workers. The group representing workers negotiating without the consent of a good majority of the workers can lead to problems during the implementation of the negotiated settlement. The collective bargaining effort serves no purpose unless an overwhelming majority of the workers acquiesces with the settlement effected by the negotiators. Otherwise, the discontent and underlying issues that cause the need for the collective bargaining remain.
On the other hand, top management also needs to agree to the collective bargaining agreement struck by the negotiators representing them. Instances of top management striking down such collective bargaining agreements, leading to the entire exercise becoming futile are commonplace. The solution to this issue is keeping the top management informed throughout the process and getting their approval before making concessions.
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Resolving Core Issues
Even if a majority or all the workers accept the collective bargaining settlement, the underlying issues still need not be resolved. Collective bargaining is a “please all" settlement that aims to strike a compromise by identifying a common ground between two divergent positions. A settlement depends on acceptance by both parties, and neither party would agree to a settlement that requires them to give something with nothing in return, or agree to one-sided drastic changes, even when such an approach might the remedy to the issue.
Again, collective bargaining is concerned only with issues that affect the workforce in general. Matters concerning individual employees or small groups of employees need not be resolved through this exercise, even when such matters remains more pressing and important than the scope of the collective bargaining exercise.
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Collective bargaining is a lengthy process and aims to effect a long-term agreement. This remains unsuited to the present day business environment, which remains in a constant state of flux. Businesses need to make frequent and fast changes in all aspects of their operations, including working conditions to respond to the challenges posed by such changes, and take advantage of emerging opportunities.
Innovation in goods and services owing to changes in the business environment leads to new work activities, obsolesce of existing work processes, and new forms of business organization. All these can lead to the collective bargaining agreement becoming redundant.
The new realties have led to dominance of individual agreements and negotiations over collective bargaining, and decentralized collective bargaining agreements at group and individual unit levels as a means to overcome the challenges of collective bargaining at a centralized level.
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- International Labor Organization. “The Collective Bargaining process." Retrieved from http://www.ilocarib.org.tt/Promalco_tool/productivity-tools/manual10/m10_3.htm%20on%2014%20February%202011.
- Eironline. “Progress and problems in collective bargaining." Retrieved from http://www.eurofound.europa.eu/eiro/2008/09/articles/es0809049i.htm%20on%2014%20February%202011.