Collective Bargaining and Importance of Collective Bargaining

Collective bargaining is one of the efficient ways of resolving industrial disputes. It is concerned with the relations between trade unions representing workers and the management representing employers. It is the distinct feature of modern industrial era. Industrial peace and harmony can be achieved only if there are healthy industrial relations in the country.

Collective bargaining is defined to cover the negotiation, administration, interpretation, application and enforcement of written agreement between employers and unions representing their employees settling for the joint understanding as to policies and procedures governing wages, rates of pay, hours of work and other condition of employment, so the collective bargaining is the technique of solving an industrial disputes. The term collective bargaining can be defined as;

According to E. B. Flippo,“Collective bargaining are a process in which the representatives of a labour organization and the representatives of the business organization meet and attend to negotiate a contract or agreement which specifies the nature of the employee-employer union relationship.”

Thus, the collective bargaining is the process of voluntary agreement. It is an agreement under which employees jointly or collectively undertake to resolve their existing or future conflicts or differences through negotiation usually between interested parties and if necessary, with the assistance of the third party. The agreement is known as labour contract or a union contract or labour management agreement. It gives the mutually agreed terms and conditions of services and represents voluntary arbitration and never a compulsory adjustment.

Importance of Collective Bargaining

Collective bargaining is considered as important for shaping better labour relation because of the following reasons.

• It is flexible means of adjusting wages and conditions of employment to changing economic, social, political, technological and other factors. Both the parties can meet whenever they desire and can adopt the term and conditions suited to the changing environment.
• It is an effective method of regulating the conditions of employment of the worker by trade unions.
• Collective bargaining is helpful in fixing standards of every worker and establishing a code of conduct defining rights, duties and obligations of each party. In other words, through collective bargaining some kinds of industrial jurisprudence is created.
• Collective bargaining results in better understanding and empathy between employer and workers. When issues regarding wages, incentives, grievances and complaints are discusses at the bargaining table, there is absolutely no room for misunderstanding between workers and management.

  SOME RELATED LINKS  

• Concept of Labour Relation

• Meaning of Unionism | Process of Unionization | Labour Legislation

• Contemporary Issues in Labour Relations in Nepal

• The Process of Collective Bargaining as a Mechanism for the Settlement of Labour Disputes

• Causes of Labour Disputes in Nepalese Organization

• Contemporary Issues in Labour Relations in Nepal

• Meaning of Unionism | Process of Unionization | Labour Legislation

• Meaning of Discipline and Grievance | Grievance Handling Procedures

Causes of Labour Disputes in Nepalese Organization | Settlement of Labour Disputes

There are the different conflicts or strike between workers and the management. They manifest in the form of strikes, lockouts and other industrial actions. They can be individual disputes or collective disputes. It can be between the employers and workers, among the workers, between employers and the government.

This types of disputes may be either right disputes – dispute over right or interest disputes – disputes due to conflict of interests. Labour disputes may result in loss of production, loss of profit, loss of market shares, low employee morale and finally the closure of the organization.

Causes of Disputes

There are many causes of labour disputes. They can be broadly divided into three categories.

1. Economic causes: They can be:
1. Compensation demands: They relate to wages, benefits and services. Inflation demands more rise in payment because the cost of items becomes expensive day by day. Employers want to pay the least and workers want to get the best in terms of wages, benefits and worker to get the best in terms of wages, benefits and welfare.
2. Bonus: There may be dispute regarding providing no bonus or low bonus to the workers by the management.
3. Working conditions: The working environment may not be acceptable. The working hours may be a problem too.
4. Condition of employment: The disputes may arise due to the terms and condition of employment.
5. Industrial sickness: Economic recession, defective taxation policies and changing competitive forces make industries sick. This may require lay-off or downsizing of organizations.
2. Managerial Causes: They are usually the unfair treatment of the union members or non-recognition of union by the management. They are manifested by; 
1. Non-reorganization to labour union: Employers usually hate recognizing the labour union, this are the root cause of disputes.
2. Lack of consultation in recruitment and selection process: Employers do not consult labour unions for recruitment and selection process, transfer, promotion and development of employees; these become the causes of disputes.
3. Job-security: Employers like to hire employees at their own. Workers see the practice as threatening to their job.
4. Disciplinary actions: Disciplinary actions are related with attendance, job behavior, dishonesty and outside activities of workers are the major causes of disputes.
5. Lack of proper and effective communication: The employers usually try to avoid talking with unions or workers about solving any situation and this lack of communication become a problem. 
3. Political Causes: They are the result of political interference, union rivalry, collective bargaining and multiplicity of labour laws. Most trade unions are affiliated with some political parties. The politicization allows the interference of politicians to the labour affairs and creates a problem for smooth relations with the management. Politicization also divides the trade unions on ideological lines. Unions break and disintegrate. Political pressures influence collective bargaining, which makes settlement difficult and complex and agreement is not reached. The interpretations of labour regulations may be a problem.

Settlement of Labour Disputes

It is better that the disputes are settled as early as possible. The methods available are;

1. Collective Bargaining: This refers to the negotiation, settlement and administration of a time-bound agreement between labour and management to settle disputes. Representatives of labour and management sit together and negotiate to settle the disputes. It is a “Peace treaty.” This is the most widely used method for the settlement of labour disputes. It benefits both labour and employer. It is democratic phenomenon. However, problems arise when agreement are not reached. Interpretations of the agreement also cause problems. 
2. Grievance Handling: This is a complaint filed and is perception of a worker’s unfair treatment on the job. This may be due to interpretation difference relating to employment contracts or collective bargaining agreement or unfair management practices; or personality trait of workers; or antagonistic organization culture. Grievance handling is a challenging stuff and facilitates upward communication. They are usually fame consuming and costly.
3. Conciliation: It is a process whereby a third party provides assistance in setting disputes. The settlement of the disputes depends on the agreement of the parties involved. The third party acts as neutral and does not impose their own decisions but beings the two parties closer.
4. Mediation: It is a process whereby the third parties are more active and submits proposals for dispute settlement. The party involved in dispute is free to accept or reject such proposals.
5. Adjudication: It is a process of mandatory settlement of a dispute by ordinary courts, labour court or a tribunal. This method only deals with disputes. The verdict of adjudication is binding on both the parties.

 SOME RELATED LINKS: 

• Concept of Labour Relation and Process of Labour Relation

• Meaning of Unionism | Process of Unionization | Labour Legislation

• Collective Bargaining and Importance of Collective Bargaining

• Contemporary Issues in Labour Relations in Nepal

• Process of Collective Bargaining as a Mechanism for the Settlement of Labour Disputes