Why is collective bargaining important for both the employees and the employer?

All over the world today, we have come to see that freedom of association is a right that is cherished by all human beings. This right among its other benefits ensures that workers in organisations or countries can meet and seek to project and protect their rights and benefits as it relates to their employment. In this regard, workers and employers can freely relate to efficiently negotiate work relations. The right of workers to meet, harmonise and uniformly negotiate their basic rights and interests with their employer is universally referred to as collective bargaining. When combined with a strong freedom of association, sound collective bargaining practices ensures that employers and workers have an equal voice in negotiations and that the outcome of such negotiations will be fair and equitable. Collective bargaining allows both sides to negotiate a fair employment relationship and prevents costly labour disputes.

Collective bargaining consists of negotiations between an employer and a group of employees in order to determine the conditions of employment. The result of collective bargaining procedure is a collective agreement. Employees are often represented in bargaining by a union or labour organization. It is a process of negotiation between representatives of workers (usually labour union officials) and the management of an organisation to determine the conditions of employment. The agreement reached may cover not only wages, but hiring practices, layoffs, promotions, working conditions and hours, and benefit programs.

Essentially collective bargaining allows workers and employers to reach voluntary agreement on a wide range of topics. It is important to point out however this ability to bargain is limited to some extent by federal and state laws in force in every country. In this regard, a collective bargaining agreement cannot accomplish by contract what the law prohibits. For example, a union and an employer cannot use collective bargaining to deprive employees of rights they would otherwise enjoy under the law. An instructive case in this regard is Alexander v. Gardner-Denver Co., 415 U.S. 36, 94 S. Ct. 1011, 39 L. Ed. 2d 147 [1974]), where it was held that a collective bargaining agreement cannot infringe on Civil Rights statutes. Collective bargaining also cannot be used to waive rights or obligations that laws impose on either party. For example, an employer may not use collective bargaining to reduce the level of safety standards it must follow under the law. Additionally, a collective bargaining agreement is not purely voluntary; one party’s failure to reach agreement entitles the other to resort to certain legal tactics, such as strikes and lockouts, to apply economic pressure and force agreement.

Indeed, some research has indicated that countries with highly coordinated collective bargaining practices tend to have less inequality in wages, lower and less persistent unemployment and fewer and shorter strikes than countries where collective bargaining is less established. Established collective bargaining practices were an element that allowed the Republic of Korea to weather the Asian financial crisis and enabled South Africa to make a relatively peaceful transition into the post-apartheid era. International Labour Organization (ILO) standards promote collective bargaining and help to ensure that good labour relations benefit everyone. Collective bargaining is concerned with the relations between trade unions and governments or management (leadership) of organizations. Bargaining is collective because chosen representatives of labour and management act as bargaining agents. It refers to a process by which employers on the one hand and representatives of the employees on the other attempt to arrive at agreements covering the conditions under which employees will contribute and be compensated for their services.

Collective bargaining developed in England at the end of the 18th century. The term collective bargaining itself was coined by a British labour historian named Mrs. Sidney Webb in 1891. Back then in the United States of America, the National Railway Act and the National Labour Relations Act in America made it illegal for any employer to deny union rights to an employee. Another step in this direction came in 1962 when President John F. Kennedy issued an executive order granting federal employees the right to unionize and collectively bargain. Even the Catholic Church has asserted that it is imperative to protect workers’ rights including collective bargaining. It is widely recognized that throughout history, unionized employees, both public and private, enjoy a living wage and benefits that they deserve while not having to worry about unjust treatment, unfair labour practices, or termination without cause. Although collective bargaining agreements are common in many countries, they are scant in developing countries that have large pools of surplus labour. Contract negotiations may occur at the national, regional, or local level, depending on the structure of industry within a country. In Nigeria, the Nigerian Labour Act, cap L1 LFN, 2004 regulates labour relations in the country. In the same vein, the South African Labour Relations Act governs labour relations in the country.

Once both parties reach an agreement on a contract, it is approved and set for a period of time. This final contract is called a collective bargaining agreement. The interests of the employees are commonly presented by representatives of a trade union to which the employees belong. The collective bargaining agreements reached by these negotiations usually set out wage scales, working hours, training, health and safety, rules/guidelines of the workplace, overtime, benefits, working conditions, grievance mechanisms and rights to participate in workplace or company affairs. A collective agreement functions as a labour contract between an employer and one or more unions.

The right to collectively bargain is recognized through international human rights conventions. Article 23 of the Universal Declaration of Human Rights identifies the ability to organize trade unions as a fundamental human right. Item 2(a) of the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work defines the “freedom of association and the effective recognition of the right to collective bargaining” as an essential right of workers.

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.

Some selected relevant International Labour Organization documents include:

1. Right to Organise and Collective Bargaining Convention, 1949 (No.98) -This fundamental Convention provides that measures appropriate to national conditions shall be taken, where necessary, to encourage and promote the full development and utilization of machinery for voluntary negotiation between employers or employers’ organizations and workers’ organizations, with a view to the regulation of terms and conditions of employment by means of collective agreements.
2. Labour Relations (Public Service) Convention, 1978 (No.151) – This Convention promotes collective bargaining for public employees, as well as other methods allowing public employees’ representatives to participate in the determination of their conditions of employment. It also provides that disputes shall be settled through negotiation between the parties or through independent and impartial machinery, such as mediation, conciliation and arbitration.
3. Collective Bargaining Convention, 1981 (No.154) – Defines collective bargaining and calls for its promotion in all branches of economic activity, including public service.

Some objectives of collective bargaining include:

1. Maintaining cordial relations between management & the workers
2. Settling disputes/conflicts relating to working conditions & wages
3. Protecting the interest of workers through collective action.
4. Ensuring the participation of trade unions
5. Resolving the differences between workers and management.

Principles of Collective Bargaining:

Principles for Trade Unions:

1. They should have open minds on various issues.
2. There should not be any room for confusion & misunderstanding.
3. Trade Unions should fully support management.
4. Strike calls should be the last resort.

Principles for Management:

1. Management should give proper recognition to trade unions.
2. Rules governing labour should be periodically examined.
3. All the clauses of agreements should be accepted in true spirit.

Principles for both Union & Management:

1. Both the parties should have faith in each other.
2. Both the parties should have positive views of the whole process rather thinking of it as formality.
3. Both the parties should adhere to all laws applicable to collective bargaining.

The process of collective bargaining includes identification of the problem, preparation for negotiations, negotiation procedure, and implementation of contract. In the same vein, the essentials of successful collective bargaining includes favourable political climate, strong and stable unions, recognition of unions, willingness to give and take, negotiator’s authority, fair practices and positive attitudes.

All over the world we have certain factors inhibiting collective bargaining and these includes; employer’s reluctance, multiple unions, non-recognition, weak unions, political interference, inadequate interventions.

There are different points of view on the advantages or disadvantages of collective bargaining in the workplace. Here is a brief listing for some of them.

Advantages:

1. Collective bargaining agreements or contracts help to guide standards.
2. It opens participation in decision-making process.
3. All union members and management must conform to terms of contract without exception.
4. Process exists to question manager’s authority if members feel something was done unjustly.
5. It can lead to high-performance workplace where labour and management jointly engage in problem solving and addressing issues on an equal standing.
6. Promotes fairness and consistency in employment policies and personnel decisions within different organizations.

Disadvantages:

1. It reduces individuality.
2. All union members and management must conform to terms of contract without exception.
3. Everyone involved must pay union dues even if they do not support unionization.
4. Creates significant potential for polarization between employees and managers.
5. Increased wages and improved facilities for workers can indirectly result in high prices for goods and services.
6. Restricts management’s ability to deal effectively with a troubled employee individually.

Above all, the importance of collectively bargaining work conditions cannot be over emphasized. It is the life wire of industrial democracy. Particularly in Africa, we see that industrial unrest continues to persist in the public sector as a result of not properly and effectively applying the use of this platform. Over the years, industrial actions on the continent have greatly hampered performance and productivity and this has not helped in fast tracking expected socio-economic development. The issue has become the bane of the public sector in many African countries. This has therefore made it difficult for governments to implement laudable policies and programmes to raise the standard of living of the citizens and this in turn has also affected the private sector. Thus creating an economic environment determined by market forces and a liberal political system is a prerequisite for African countries if there is to be an enabling environment for sound industrial relations to thrive as this would positively impact the continent’s economy.

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