Defining the Concept of Collective Bargaining

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The term “Collective Bargaining” originated in the writings of Sidney and Beatrice Webb, the famed historian of the British labour movement, towards the end of the 19th century. Collective bargaining is a process of joint decision-making and basically represents a democratic way of life in industry. It establishes a culture of bipartism and joint consultation in industry and a flexible method of adjustment to economic and technical changes in an industry. It helps in establishing industrial peace without disrupting either the existing arrangements or the production activities.

Collective bargaining has been defined in the Encyclopaedia of Social Sciences, as “a process of discussion and negotiation between two parties, one or both of whom is a group of persons acting in concert. The resulting bargain is an understanding as to the terms and conditions under which a continuing service is to be performed. More specifically, collective bargaining is a procedure by which employers and a group of employees agree upon the conditions of work.”

Stevens defines collective bargaining as a ‘social-control technique for reflecting and transmitting the basic power relationships which underlie the conflict of interest in an industrial relations system.’ The definition emphasizes important characteristics of collective bargaining, that it is concerned with the application of power in the adjustment of inherent conflicts of interest. Webbs described collective bargaining as an economic institution, with trade unionism acting as a labour cartel by controlling entry into the trade.

Prof. Allan Flanders has argued on the other hand, that collective bargaining is primarily a political rather than an economic process. He describes collective bargaining as a power relationship between a trade union organisation and the management organisation. The agreement arrived at is a compromise settlement of power conflicts. In Flanders’ view collective bargaining is joint administration, synonymous with joint management.

Collective bargaining has been described by Dubin as “the great social invention that has institutionalised industrial conflict” and by the Donovan Commission as “a right which is or should be the prerogative of every worker in a democratic society.”

Hence, Collective Bargaining may be defined as: “A method of determining terms and conditions of employment and regulating the employment relationship which utilises the process of negotiation between representatives of management and employees intended to result in an agreement which may be applied across a group of employees”. It is a method by which management and labour may explore each other’s problems and viewpoints, and develop a framework of employment relations and a spirit of cooperative goodwill for their mutual benefit. It has been described as a civilised bipartite confrontation between the workers and the management with a view to arriving at an agreement. In brief, it can be described as a continuous, dynamic process for solving problems arising directly out of the employer-employee relationship.

Collective bargaining serves a number of important functions. It is a rule making or legislative process in the sense that it formulates terms and conditions under which labour and management may cooperate and work together over a certain stated period. It is also a judicial process for every collective agreement there is a provision or clause regarding the interpretation of the agreement and how any difference of opinion about the intention or scope of a particular clause is to be resolved. It is also an executive process as both management and union undertake to implement the agreement signed. John Dunlop and Derek Bok have listed five important functions of collective bargaining: (i) Establishing the rules of the workplace

(ii) Determining the form of compensation;
(iii) Standardising compensation
(iv) Determining priorities on each side
(v) Redesigning the...
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