Collective bargaining is a process of negotiation between employers and a group of employees aimed at agreements to regulate working salaries, working conditions, benefits, and other aspects of workers' compensation and rights for workers. The interests of the employees are commonly presented by representatives of a trade union to which the employees belong. A collective agreement reached by these negotiations functions as a labour contract between an employer and one or more unions, and typically establishes terms regarding wage scales, working hours, training, health and safety, overtime, grievance mechanisms, and rights to participate in workplace or company affairs.[1] Such agreements can also include 'productivity bargaining' in which workers agree to changes to working practices in return for higher pay or greater job security.[2]
The union may negotiate with a single employer (who is typically representing a company's shareholders) or may negotiate with a group of businesses, depending on the country, to reach an industry-wide agreement. Collective bargaining consists of the process of negotiation between representatives of a union and employers (generally represented by management, or, in some countries such as Austria, Sweden and the Netherlands, by an employers' organization) in respect of the terms and conditions of employment of employees, such as wages, hours of work, working conditions, grievance procedures, and about the rights and responsibilities of trade unions. The parties often refer to the result of the negotiation as a collective bargaining agreement (CBA) or as a collective employment agreement (CEA).
The term "collective bargaining" was first used in 1891 by Beatrice Webb, a founder of the field of industrial relations in Britain.[3] It refers to the sort of collective negotiations and agreements that had existed since the rise of trade unions during the 18th century.
In the United States, the National Labor Relations Act of 1935 made it illegal for any employer to deny union rights to an employee. The issue of unionizing government employees in a public-sector trade union was much more controversial until the 1950s. In 1962, President John F. Kennedy issued an executive order granting federal employees the right to unionize.
An issue of jurisdiction surfaced in National Labor Relations Board v. Catholic Bishop of Chicago (1979) when the Supreme Court held that the National Labor Relations Board (NLRB) could not assert jurisdiction over a church-operated school because such jurisdiction would violate the First Amendment establishment of freedom of religion and the separation of church of state.[4]
Union members and other workers covered by collective agreements get, on average, a wage markup over their nonunionized (or uncovered) counterparts. Such a markup is typically 5–10 percent in industrial countries.[8]
Unions tend to equalize the income distribution, especially between skilled and unskilled workers.[8]
The deadweight loss associated with unions is 0.2 to 0.5 percent of GDP, which is similar to monopolies in product markets.[8]
An empirical model for empirical analysis and computer-assisted collective bargaining has been developed at the Hans Böckler Foundation.[9][10][11]
Internationally
OECD
Only one in three OECD employees have wages which were agreed on through collective bargaining. The Organization for Economic Co-operation and Development, with its 36 members, has become an outspoken proponent for collective bargaining as a way to ensure that the falling unemployment also leads to higher wages.[12]
Canada
In June 2007 the Supreme Court of Canada extensively reviewed the rationale for regarding collective bargaining as a human right. In the case of Facilities Subsector Bargaining Association v. British Columbia, the Court made the following observations:
The right to bargain collectively with an employer enhances the human dignity, liberty and autonomy of workers by giving them the opportunity to influence the establishment of workplace rules and thereby gain some control over a major aspect of their lives, namely their work... Collective bargaining is not simply an instrument for pursuing external ends... rather [it] is intrinsically valuable as an experience in self-government... Collective bargaining permits workers to achieve a form of workplace democracy and to ensure the rule of law in the workplace. Workers gain a voice to influence the establishment of rules that control a major aspect of their lives.[13]
Sweden
In Sweden the coverage of collective agreements is very high despite the absence of legal mechanisms to extend agreements to whole industries. In 2018, 83% of all private-sector employees were covered by collective agreements, 100% of public sector employees and in all 90% (referring to the whole labor market).[14] This reflects the dominance of self-regulation (regulation by the labour market parties themselves) over state regulation in Swedish industrial relations.[15]
Australia
Collective bargaining in Australia has its roots in the early 20th century, with the introduction of the conciliation and arbitration system. This system was established to resolve industrial disputes through the intervention of an independent third party, which could make legally binding decisions. Over the years, this system underwent significant transformations, reflecting the changing priorities of different governments and the shifting balance of power between employers and unions.[16]
Legislative Framework The Fair Work Act 2009 is the cornerstone of contemporary collective bargaining in Australia. The Act provides for "good faith bargaining"[17] requirements, ensuring that parties engage in negotiations sincerely with the aim of reaching an agreement. This framework facilitates several key aspects of the collective bargaining process:
1. Enterprise Bargaining: The focus of collective bargaining in Australia is on enterprise bargaining, which allows for more flexible working conditions tailored to the specific needs of an enterprise and its employees. [18]
2. Role of Unions: While union membership has declined in recent decades, unions still play a crucial role in the collective bargaining process, representing workers in negotiations with employers.[19]
3. Bargaining Representative: Employees can appoint a bargaining agent, such as a union representative, to negotiate on their behalf.[20]
4. Good Faith Bargaining: Parties involved in collective bargaining are required to meet good faith bargaining requirements, which include attending meetings, considering proposals, and responding in a timely manner.[17]
5. Industrial Action:Industrial action, including strikes and lockouts, can be a part of the bargaining process but is subject to strict regulations, including protected action ballots.[21]
United States
...where free unions and collective bargaining are forbidden, freedom is lost.[22]
Ronald Reagan, Labor Day Speech at Liberty State Park, 1980
In the United States, the National Labor Relations Act (1935) covers most collective agreements in the private sector. This act makes it illegal for employers to discriminate, spy on, harass, or terminate the employment of workers because of their union membership or to retaliate against them for engaging in organizing campaigns or other "concerted activities", to form company unions, or to refuse to engage in collective bargaining with the union that represents their employees. It is also illegal to require any employee to join a union as a condition of employment.[23] Unions are also able to secure safe work conditions and equitable pay for their labor.
At a workplace where a majority of workers have voted for union representation, a committee of employees and union representatives negotiate a contract with the management regarding wages, hours, benefits, and other terms and conditions of employment, such as protection from termination of employment without just cause. Individual negotiation is prohibited. Once the workers' committee and management have agreed on a contract, it is then put to a vote of all workers at the workplace. If approved, the contract is usually in force for a fixed term of years, and when that term is up, it is then renegotiated between employees and management. Sometimes there are disputes over the union contract; this particularly occurs in cases of workers fired without just cause in a union workplace. These then go to arbitration, which is similar to an informal court hearing; a neutral arbitrator then rules whether the termination or other contract breach is extant, and if it is, orders that it be corrected.
In 24 U.S. states,[24] employees who are working in a unionized shop may be required to contribute towards the cost of representation (such as at disciplinary hearings) if their fellow employees have negotiated a union security clause in their contract with management. Dues are generally 1–2% of pay. However, union members and other workers covered by collective agreements get, on average, a 5–10% wage markup over their nonunionized (or uncovered) counterparts.[8] Some states, especially in the south-central and south-eastern regions of the U.S., have outlawed union security clauses; this can cause controversy, as it allows some net beneficiaries of the union contract to avoid paying their portion of the costs of contract negotiation. Regardless of state, the Supreme Court has held that the Act prevents a person's union dues from being used without consent to fund political causes that may be opposed to the individual's personal politics. Instead, in states where union security clauses are permitted, such dissenters may elect to pay only the proportion of dues which go directly toward representation of workers.[25]
The American Federation of Labor was formed in 1886, providing unprecedented bargaining powers for a variety of workers.[26] The Railway Labor Act (1926) required employers to bargain collectively with unions.
In 1931 the Supreme Court, in the case of Texas & N.O.R. Co. v. Brotherhood of Railway Clerks, upheld the act's prohibition of employer interference in the selection of bargaining representatives.[26] In 1962, President Kennedy signed an executive order giving public-employee unions the right to collectively bargain with federal government agencies.[26]
The Office of Labor-Management Standards, part of the United States Department of Labor, is required to collect all collective bargaining agreements covering 1,000 or more workers, excluding those involving railroads and airlines.[27] They provide public access to these collections through their website.
↑ Tangian, Andranik (2011). "Chapter 9: Flexicurity in collective agreements". Flexicurity and Political Philosophy. New York: Nova. pp.113–126. ISBN978-1-61122-816-8.
↑ Isaac, Joe; Macintyre, Stuart (2004). The New Province for Law and Order: 100 Years of Australian Industrial Conciliation and Arbitration. Cambridge University Press.
Buidens, Wayne, and others. "Collective Gaining: A Bargaining Alternative". Phi Delta Kappan 63 (1981): 244–245.
DeGennaro, William, and Kay Michelfeld. "Joint Committees Take the Rancor out of Bargaining with Our Teachers". The American School Board Journal 173 (1986): 38–39.
Herman, Jerry J. "With Collaborative Bargaining, You Work with the Union—Not Against It". The American School Board Journal 172 (1985): 41–42, 47.
Huber, Joe; and Jay Hennies. "Fix on These Five Guiding Lights, and Emerge from the Bargaining Fog". The American School Board Journal 174 (1987): 31.
Kjellberg, Anders (2019) "Sweden: collective bargaining under the industry norm", in Torsten Müller & Kurt Vandaele & Jeremy Waddington (eds.) Collective bargaining in Europe: towards an endgame, European Trade Union Institute (ETUI) Brussels 2019. Vol. III (pp.583–604).
Liontos, Demetri. Collaborative Bargaining: Case Studies and Recommendations. Eugene: Oregon School Study Council, University of Oregon, September 1987. OSSC Bulletin Series. 27 pages. ED number not yet assigned.
McMahon, Dennis O. "Getting to Yes". Paper presented at the annual conference of the American Association of School Administrators, New Orleans, LA, February 20–23, 1987. ED 280 188.
Namit, Chuck; and Larry Swift. "Prescription for Labor Pains: Combine Bargaining with Problem Solving". The American School Board Journal 174 (1987): 24.
A trade union or labor union, often simply referred to as a union, is an organization of workers whose purpose is to maintain or improve the conditions of their employment, such as attaining better wages and benefits, improving working conditions, improving safety standards, establishing complaint procedures, developing rules governing status of employees and protecting and increasing the bargaining power of workers.
Labour laws, labour code or employment laws are those that mediate the relationship between workers, employing entities, trade unions, and the government. Collective labour law relates to the tripartite relationship between employee, employer, and union.
Strike action, also called labor strike, labour strike and industrial action in British English, or simply strike, is a work stoppage caused by the mass refusal of employees to work. A strike usually takes place in response to employee grievances. Strikes became common during the Industrial Revolution, when mass labor became important in factories and mines. As striking became a more common practice, governments were often pushed to act. When government intervention occurred, it was rarely neutral or amicable. Early strikes were often deemed unlawful conspiracies or anti-competitive cartel action and many were subject to massive legal repression by state police, federal military power, and federal courts. Many Western nations legalized striking under certain conditions in the late 19th and early 20th centuries.
In labor law, a union shop, also known as a post-entry closed shop, is a form of a union security clause. Under this, the employer agrees to either only hire labor union members or to require that any new employees who are not already union members become members within a certain amount of time. Use of the union shop varies widely from nation to nation, depending on the level of protection given trade unions in general.
United States labor law sets the rights and duties for employees, labor unions, and employers in the US. Labor law's basic aim is to remedy the "inequality of bargaining power" between employees and employers, especially employers "organized in the corporate or other forms of ownership association". Over the 20th century, federal law created minimum social and economic rights, and encouraged state laws to go beyond the minimum to favor employees. The Fair Labor Standards Act of 1938 requires a federal minimum wage, currently $7.25 but higher in 29 states and D.C., and discourages working weeks over 40 hours through time-and-a-half overtime pay. There are no federal laws, and few state laws, requiring paid holidays or paid family leave. The Family and Medical Leave Act of 1993 creates a limited right to 12 weeks of unpaid leave in larger employers. There is no automatic right to an occupational pension beyond federally guaranteed Social Security, but the Employee Retirement Income Security Act of 1974 requires standards of prudent management and good governance if employers agree to provide pensions, health plans or other benefits. The Occupational Safety and Health Act of 1970 requires employees have a safe system of work.
Labor rights or workers' rights are both legal rights and human rights relating to labor relations between workers and employers. These rights are codified in national and international labor and employment law. In general, these rights influence working conditions in the relations of employment. One of the most prominent is the right to freedom of association, otherwise known as the right to organize. Workers organized in trade unions exercise the right to collective bargaining to improve working conditions.
The duty of fair representation is incumbent upon Canadian and U.S. labor unions that are the exclusive bargaining representative of workers in a particular group. It is the obligation to represent all employees fairly, in good faith, and without discrimination.
In Canadian labour law, the Rand formula is a workplace compromise arising from jurisprudence struck between organized labour and employers that guarantees employers industrial stability by requiring all workers affected by a collective agreement to pay dues to the union by mandatory deduction in exchange for the union agreement to "work now, grieve later."
An Australian workplace agreement (AWA) was a type of formalised individual agreement negotiated between an employer and employee in Australia that existed from 1996 to 2009. Employers could offer a "take it or leave it" AWA as a condition of employment. They were registered by the Employment Advocate and did not require a dispute resolution procedure. These agreements operated only at the federal level. AWAs were individual written agreements concerning terms and conditions of employment between an employer and employee in Australia, under the Workplace Relations Act 1996. An AWA could override employment conditions in state or territory laws except those relating to occupational health and safety, workers' compensation, or training arrangements. An AWA was required to meet only the most minimal Australian Fair Pay and Conditions Standard. Agreements were not required to include effective dispute resolution procedures, and could not include prohibited content. Agreements were for a maximum of five years; approved, promoted and registered by the Workplace Authority; operated to the exclusion of any award; and prohibited industrial action regarding details in the agreement for the life of the agreement. The introduction of AWAs was a very controversial industrial relations issue in Australia.
The Trade Union and Labour Relations (Consolidation) Act 1992 is a UK Act of Parliament which regulates United Kingdom labour law. The act applies in full in England and Wales and in Scotland, and partially in Northern Ireland.
Labor relations or labor studies is a field of study that can have different meanings depending on the context in which it is used. In an international context, it is a subfield of labor history that studies the human relations with regard to work in its broadest sense and how this connects to questions of social inequality. It explicitly encompasses unregulated, historical, and non-Western forms of labor. Here, labor relations define "for or with whom one works and under what rules. These rules determine the type of work, type and amount of remuneration, working hours, degrees of physical and psychological strain, as well as the degree of freedom and autonomy associated with the work." More specifically in a North American and strictly modern context, labor relations is the study and practice of managing unionized employment situations. In academia, labor relations is frequently a sub-area within industrial relations, though scholars from many disciplines including economics, sociology, history, law, and political science also study labor unions and labor movements. In practice, labor relations is frequently a subarea within human resource management. Courses in labor relations typically cover labor history, labor law, union organizing, bargaining, contract administration, and important contemporary topics.
The Wartime Labour Relations Regulations, adopted under the War Measures Act on 17 February 1944, were introduced in Canada during World War II by the government of Prime Minister William Lyon Mackenzie King. Drafted loosely on the American Wagner Act, it was the first federal legislation in Canada to legally protect the formation of unions and to force employers to negotiate with organized workers. It was a foundational framework for legislation of union rights in Canada. The provisions of the order were later replicated by Acts of all the provincial legislatures.
A collective agreement, collective labour agreement (CLA) or collective bargaining agreement (CBA) is a written contract negotiated through collective bargaining for employees by one or more trade unions with the management of a company that regulates the terms and conditions of employees at work. This includes regulating the wages, benefits, and duties of the employees and the duties and responsibilities of the employer or employers and often includes rules for a dispute resolution process.
The Blue Eagle at Work: Reclaiming Democratic Rights in the American Workplace is a legal treatise written by Charles J. Morris which analyzes collective bargaining under the National Labor Relations Act (NLRA), the federal statute governing most private sector labor relations in the United States. Published in 2005 by Cornell University Press, the text claims that the NLRA guarantees that employees under that Act have the right to bargain collectively through minority unions—but only on a members-only basis—in workplaces where there is not an established majority union, notwithstanding that the present practice and general understanding of the law is that only majority-union employees are entitled to engage in collective bargaining on an exclusivity basis. Contracts resulting from such minority-union bargaining would apply to union members only, not to other employees.
NLRB v. Mackay Radio & Telegraph Co., 304 U.S. 333 (1938), is a United States labor law case of the Supreme Court of the United States which held that workers who strike remain employees for the purposes of the National Labor Relations Act (NLRA). The Court granted the relief sought by the National Labor Relations Board, which sought to have the workers reinstated by the employer. However, the decision is much better known today for its obiter dicta in which the Court said that an employer may hire strikebreakers and is not bound to discharge any of them if or when the strike ends.
South African labour law regulates the relationship between employers, employees and trade unions in the Republic of South Africa.
A master contract or master agreement is a collective bargaining agreement which covers all unionized worksites in an industry, market or company, and which establishes the terms and conditions of employment common to all workers in the industry, market or company.
The Fair Work Act 2009(Cth) is an Act of the Parliament of Australia, passed by the Rudd government to reform the industrial relations system of Australia. It replaced the Howard government's WorkChoices legislation, it established Fair Work Australia, later renamed the Fair Work Commission.
Collective agreement coverage or union representation refers to the proportion of people in a country population whose terms and conditions at work are made by collective bargaining, between an employer and a trade union, rather than by individual contracts. This is invariably higher than the union membership rate, because collective agreements almost always protect non-members in a unionised workplace. This means that, rather than individuals who have weaker bargaining power representing themselves in negotiations, people organise to represent each other together when negotiating for better pay and conditions in their workplace. The number of people who are covered by collective agreements is higher than the number of union members, and in many cases substantially higher, because when trade unions make collective agreements they aim to cover everyone at work, even those who have not necessarily joined for membership.
Saskatchewan Federation of Labour v Saskatchewan [2015] 1 SCR 245 is a Canadian labour law case on the right to strike.
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