Collective Bargaining

In the USA, this idea was widely embraced and applied to resolving labor disputes. Collective bargaining as a means of resolving labor problems is relatively new in India. The greatest approach is collective bargaining, since it allows the disputants to get together and settle their disputes amicably and respectfully.

Meaning of Collective Bargaining

Collective bargaining simply refers to negotiations or bargaining that takes place between employers and employees. Sydney and Beatrice were the first to use the term "collective bargaining" in 1891. They defined collective bargaining as "a procedure by which workers get together and send senates to convey over their terms and circumstances of employment."

It occurs when a number of workers engage in negotiations as a brokering unit with an employer or another group of workers with the goal of coming to an agreement on the terms of their employment and working conditions. As a kind of negotiation applicable to the employment relationship, collective bargaining is a specific industrial relations technique or method.

Collective bargaining is described by the I.L.O. as "the negotiations about working circumstances and terms of employment between an employer, or a group of employers, or one or more employers' organizations, on the one hand, and one or more representative workers' organizations, on the other, to reach an agreement."

Types of Collective Bargaining

There are two kinds of negotiations in collective bargaining −

Conjunctive or Distributive Bargaining

It addresses problems where parties have competing interests and each makes the most of their forced power. One party gain while the other loses in this arrangement, which is a win-lose scenario. A clear example of distributive bargaining is wage negotiations.

Integrative or Cooperative Bargaining

Integrative negotiation focuses on finding solutions to issues that both sides are facing. Both parties benefit from the circumstance; thus, neither can succeed without the other.

Characteristics of Collective Bargaining

Major characteristics of collective bargaining are −


Collective bargaining is a flexible process that allows for plenty of compromise and mutual "give and take" before the final agreement is stretched.

Group Activity

Contrary to individual action, collective bargaining is a group action. The respective groupings of each party to the settlement are present. Delegates from the employer are in charge of representing the company, and the employees' union is in charge of representing the workers.

Continuous Process

It is a constant process, so there is no final agreement. It offers a framework for ongoing, structured interactions between management and labor organizations.

Bipartite Process

Employees and their representatives negotiate openly and face-to-face during this collective procedure. Together, they combine two ways.

  • The perks and shared interests of all employees are negotiated collectively.

  • By using solutions, the employees and management reach a mutually agreeable conclusion.

Dynamic Process

Massive modifications have been made to the collective bargaining process. Though it was once sentimental, emotional, and turbulent, it is now growing, expanding, and evolving. As of right now, it is true, scientific, and organized.


Significance To Workers

  • It fosters a feeling of self-respect and community among employees.

  • Groups have greater negotiating power.

  • Boost productivity and morale.

  • The union's influence is increased by it.

  • Management is not allowed to make a choice by itself.

Concerns For Employers

  • Employers see better productivity as a result of ongoing communication with the workforce.

  • Resolving problems at the preventive level is simpler for management.

  • The distance between the top and bottom levels of the management structure is narrowing.

Social Significance

  • It promotes societal and industrial peace.

  • It regulates management's exploitation of the workforce.

  • It aids in the nation's social and economic advancement.

  • It fosters a feeling of equality in the community.

Collective Bargaining Theories

An Agreement Based on The Marketing Concept

Collective bargaining is seen as a contract for the sale of labor in the marketing sense. In accordance with this view, workers can only sell their labor on conditions that have been collectively decided upon and are based on a contract that has been created through the course of collective bargaining.

The Idea of Government as A Rule of Law

According to the government's concept, the industry's collective bargaining system is a constitutional one. This connection is political. The union represents the interests of the workers by using the authority that it shares with management over them.

The Joint Decisions Concept in Industrial Relations

Collective bargaining is viewed by industrial relations as a way for the union to be represented in decision-making and as a way for employees to have a voice in formulating the rules that govern and regulate their working lives.

India's Collective Bargaining

It is important to first look into the history of trade unions in India because collective bargaining has increased in India at the same time that trade unions have expanded. N.M. Lokhande, an actual factory worker, is credited with starting the systematized labor movement in India. While Mahatma Gandhi was establishing the idea of arbitration in 1920, the first collective bargaining treaty in Ahmedabad's textile sector was drafted.

The study of the ensuing documents, combined with the court's rulings, demonstrates that collective bargaining is legitimate and recognized in India.

  • Trade Union Act, 1929 − The Act specifies the rights, obligations, and privileges of the union as well as how trade unions are to be registered. It is widely known that collective bargaining is one of the methods for regulating such a relation. The main reason why a trade union is formed is to regulate the relationships between the employer and employee or among themselves.

  • Industrial Disputes Act, 1947 − The act was passed to establish a procedure for resolving disputes. A settlement reached by agreement between the employer and employee outside of a conciliation action shall be binding for the parties to the agreement, according to Section 18 of the Act.

  • The Constitution of India − The Basic Rights Chapter and the Directive Principles of State Policy in the Indian Constitution uphold the legitimacy of collective bargaining, and as was already said, one of a trade union's primary goals is collective bargaining, which is permitted by Article 19 of the Constitution.

  • Industrial Employment (Standing Orders) Act, 1946 − The employer creates a standing order that outlines the terms of employment. According to Section 3 of the Act, the employer must first provide the Certifying Officer with a draft standing order that, to the greatest extent feasible, complies with the model standing order.


A democratic method of industrial life, collective bargaining is the process of jointly deciding on terms of agreement. The sides must be ready and willing to compromise for collective bargaining to be successful, or else the entire purpose of the process would be for naught.

The issue with India's situation is that a representative trade union's ability to bargain with an employer is hampered by the lack of any central-level legislation requirements for such recognition.

Frequently Asked Questions

Q1. What is labour law?

Ans. Labor laws, also referred to as employment laws or labor laws, are those that serve as a mediator between employers, employees, labor unions, and the government. The tripartite connection between the union, the employer, and the employee is addressed by collective labor law.

Q2. What do you mean by living wages?

Ans. The bare minimum salary that a worker needs to make ends meet is referred to as a livable wage. This differs from a minimal wage that tracks worker productivity, such as a survival wage, which refers to a living minimum, and a solidarity wage.

Q3. What is the meaning of precarious work?

Ans. Critics use the phrase "precarious work" to refer to non-standard or temporary jobs that may be underpaid, unstable, unprotected, or unable to sustain a family.

Updated on: 31-Mar-2023


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