Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations Unit Collective Bargaining

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations 22-2 Introduction Collective bargaining is a method to determine working conditions and terms of employment through negotiations. Negotiations take place between ‘employers’ organisations and one or more workers organisations. Negotiations helps to reach an agreement. Collective bargaining is considered as an economic institution and trade unionism by forming a labour cartel restricts the entry into the trade. The most comprehensive definition of collective bargaining has been provided by TULRCA 1992 s. 178 (1) & (2) of U.K. employment law programme. It is a negotiation connected with one or more of the following: a) terms and conditions of employment, or the physical conditions in which workers are required to work, b) engagement or non-engagement, or termination or suspension of employment or the duties of employment, of one or more workers,

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations 22-3 Important Assumptions to Achieve Stable Collective Bargaining 1. While employers and employees have different interests, these differences are not irreconcilable. Instead they are somewhat the same as the difference between buyers and sellers in general. Therefore, through bargaining, a deal can be cut which sets the price and regulates the conditions under which employees sell their labour. 2. Each side accepts the legitimacy of the other and its right to survive. 3. The sides are roughly equal in strength; otherwise one side will dominate rather than bargain with the other. 4. The union legitimately represents the interests of all of those it claims to represent (a claim sometimes questioned by women and members of minority groups). 5. Both parties are willing to negotiate seriously with the aim of reaching agreement. 6. The Government plays only a limited direct role in bargaining.

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations 22-4 Role of Government in Collective Bargaining The government may influence collective bargaining and employment conditions in ways which differ greatly among countries: It may determine employment conditions by law, for example, through setting minimum wages, legislating the length of holiday or preventing ethnic discrimination. It may provide some benefits directly, for example, pensions. It may set the ground rules which govern the parties conduct, for example, through giving unions the right to bargain, restricting the conditions under which strikes may occur or determining the scope of bargaining. It may settle disputes which the parties are unable to settle themselves often through mediation or arbitration. In Australia conciliation and arbitration play major role in determining the conditions of employment. Through its macroeconomic and social policies it affects the terms of bargaining agreements.

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations 22-5 Characteristics of Collective Bargaining From the foregoing definitions of collective bargaining, some essential characteristics may be enumerated as follows: a. It is a group action as opposed to individual action and initiated through the representatives of workers and delegates of the management at the bargaining table. b. It is flexible and mobile and not fixed or static. It has flexibility and ample scope for compromise for a mutual give and take before the final agreement. c. It is a continuous process, which provides a mechanism for continuing and organised relationships between management and trade unions. The heart of collective bargaining is the process for continuing joint consideration and adjustment of plant and problems. d. The term is dynamic itself because the concept is growing, expanding and changing. e. It is industrial democracy at work.

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations 22-6 Importance and Need for Collective Bargaining It is evident from the foregoing discussion that to settle differences on the work related issues, collective bargaining as a process is perceived both by employers and employees as an important machinery. We have adequately covered the general issues which are usually settled through collective bargaining. The need for collective bargaining in India arose due to some controversial problem which the Indian industry had to face after the termination of the Second World War.

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations 22-7 Prerequisites for Collective Bargaining 1. It is necessary for the management to recognise the union and to bargain in more good faith, in the unionised situation. 2. For the purpose of collective bargaining, employers should be represented by the management and workers by their union representatives. 3. It is also appreciable to have open minds, listening to others’ concern and point of view and to have some flexibility in making adjustments to the demands. 4. Either side should avoid putting forth any irrational or unreasonable demand. 5. Strikes and lockouts should be the last resort. Periodic discussions may be necessary between management and unions to interpret the provisions of the contract and clarify doubts. 6. Trade unions should be equally concerned with both, quality of work, leading up to a consistent concern for the viability of the firm and its products and services. 7. Once the agreement is reached, it must be honoured and fairly implemented.

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations 22-8 Cont…. Collective Bargaining in India The term collective bargaining in fact originated from Great Britain and was coined by Beatrice Potter as is evident from her book The Co-operative Movement’ in 1891 and ‘Industrial Democracy in 1897, where it was regarded as the alternative to individual bargaining. In India, however, collective bargaining is a late development and has marked its presence only in the year 1918, in Ahmedabad. Voluntary collective bargaining in industry and commerce has developed in India since independence. In 1918, Gandhiji was leading the textile workers of Ahmedabad in their demand for better working conditions, but even though he had supported their strike, he was advocating the resolution of conflict by negotiation and mutual discussion between the accredited organisations of labourers and employers.

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations 22-9 Cont…. In 1952, after a lapse of about 14 years, the Ahmedabad Mill Owners’ Association and the Textile Labour Union signed two agreements, initially for two years, by which the machinery of voluntary arbitration was revived. This was a proper collective bargaining between the two representative organisations, who agreed that in future all disputes between mills and their employees should be settled out of the court. Collective bargaining in Ahamedabd textile industry is now carried out at two levels, viz. a) Between Mill Owners’ Association and Textile Labour Association, and b) Between individual mills and Textile Labour Association. In 1955, a general agreement on the subject of annual bonus was reached for the years , covering all the mills. In 1957, a joint productivity council was set up for Ahmedabad textiles. From the above discussion, it is clear that a continuing collective bargaining process has come into being in Ahmedabad textile industry.

Excel Books Human Resource Management (2nd Edition) Dipak Kumar Bhattacharyya Copyright © 2006, Dipak Kumar Bhattacharyya Collective Bargaining Unit:22 Block: Eight Employee Relations Month-wise Collective Bargaining Agreements during the Quarter ending 31st December, 1994 S.No.Subject Number of AgreementsTotal October 1994November 1994December Wages/DA Bonus Overtime House Rent Health Welfare Hours of Work Conveyance Leave Liveries Service Matter Others Total