Prof. Hiteshwari Jadeja

Collective bargaining: meaning Collective bargaining is defined as a free and voluntary forum that facilitates negotiation between employers and employees’ unions on issues affecting the interest and rights of both parties so that an amicable settlement is reached in good faith.

Features of collective bargaining Joint process Interactive mode Continuous process Adversarial strategy Union-based initiative

Importance of CB It helps increase the economic strength of both the parties at the same time protecting their interests. It helps establish uniform conditions of employment with a view to avoid occurrence of industrial disputes. It helps resolve disputes when they occur. It lays down rules and norms for dealing with labour. It helps usher in democratic principles into the industrial world.

Evolution of Collective Bargaining CB rose and grew with the trade union movement. Roots of CB lie in Great Britain where it developed in response to the conditions created by the Industrial Revolution. Along with trade unions, the idea of bargaining collectively gained strength in the early part of the 18 th Century. Initially, the negotiations were carried out at plant level. By early 1900, industry and national level agreements became quite common. The idea spread across to France, Germany, and USA. And today, through the process of CB, organizations have learnt to cope with industrial conflict.

The Indian Scenario: ◦ In India, trade unions gained prominence much later – only after ◦ In 1918, Gandhiji - as the leader of the Ahmedabad textile workers – advocated the resolution of conflict through CB agreements. ◦ But the idea gathered interest only after the Second World War.  The Government of that time took steps like setting up of machinery for negotiations, conciliation and arbitration. ◦ The trade union movement and also CB agreements became popular after Indian independence.  Moving from agreements at the plant level, such agreements spread to industries such as chemicals, petroleum, tea, coal, oil and aluminum.  In ports and docks, banking and insurance, collective agreements were arrived at, right at the national level.

Types of bargaining The types of bargaining are Distributive bargaining Integrative bargaining Centralized bargaining Decentralized bargaining

Distributive bargaining A bargaining process is described as distributive bargaining when the parties to the bargaining process have conflicting needs, interests and goals. In distributive bargaining, the employers and employees normally adopt opposing positions. In this kind of bargaining, one party’s gain is another party’s loss as their needs are mutually exclusive. Economic issues like wages revisions, benefits, bonuses, leaves and workloads become the major agenda of distributive bargaining.

Integrative bargaining When there is a convergence of interests, needs and goals among the parties to the bargaining, the bargaining process is usually described as integrative bargaining. In this type of bargaining, the employers and the employees have the same attitude towards the issues discussed in the bargaining and are equally concerned about its outcome. Agreements regarding employee health and safety at the end of the bargaining process usually benefit both the parties.

Centralized bargaining When collective bargaining is conducted at higher levels like the national level or industry levels in a centralized manner, it is called centralized bargaining. This may be sectoral or central wage bargaining. The chief merit of centralized bargaining is that the centralized wage agreements ensure equal pay increase for equal jobs, irrespective of all other factors.

Decentralized bargaining In case of decentralized collective bargaining, the bargaining is conducted at the enterprise level or even at the individual level. In decentralized bargaining, an organization can develop a tailor-made wage package which best suits the interests of both the employer and the employees. Decentralized bargaining provides an opportunity to the employees to participate in the decision- making process.

The Collective Bargaining Process

COLLECTIVE BARGAINING IN INDIA Causes of limited success of CB in India: 1. Problems with Unions 2. Problems from Government 3. Political Interference 4. Legal Problems 5. Management Attitude

-Problems with unions:  CB mainly depends on the strength of unions.  Weak trade unions cannot initiate strong arguments during negotiations.  Not many strong unions in India.  Indian unions are bogged down by the problems of: multiplicity, inter and intra-union rivalry, weak financial position and non- recognition.  So, unanimous decision is unlikely to be presented at the negotiating table. -Problems from Government:  The Government has not been making any strong efforts for the development of CB.  Imposition of many restrictions regarding strikes and lockouts has removed the `edge` of the CB process.

◦ Political interference:  Interference of political leaders in all aspects of union matters has increased over the years.  Almost all unions are associating themselves with some political party or the other. ◦ Legal problems:  Now that adjudication is easily accessible, the CB process is losing its importance. ◦ Management attitude:  In India, managements have a negative attitude towards unions.  They do not appreciate their workers joining unions.

Conditions for Success of collective bargaining An effective collective bargaining requires Strong unions and an effective leadership The organization’s recognition of unions Top management support Positive external environment Openness and flexibility Fair labour practices

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