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What are the Pros and Cons of Collective Bargaining

What are the Pros and Cons of Collective Bargaining

Collective agreement between an employer and employees can be reached if a process of negotiations is initiated by the union that is usually a trade union. Such a bargaining process helps them reach an agreement regarding their working conditions. Scroll down to learn about the pros and cons of collective bargaining through this article.
Suganya Sukumar
Last Updated: Jun 3, 2018
Collective bargaining is a term which was first coined in 1891 by an economist called Sidney Webb. During the nineteenth century, collective agreements and contracts were prevalent as the trade unions were gaining momentum. If a group of employees are not able to achieve their needs and desires, they could form a union and rise against the management. The process can be initiated by the trade union unless the coverage clause in the proposed collective agreement, overlaps with any other previous agreements which the union had already proposed. A collective agreement could be legally achieved through negotiations between the employer and a group of employees. The employer's rights at workplace are guaranteed by the Contracts of Employment Act 1972.

This concept is defined by John Grogan as, "the process by which employers and organized groups of employees seek to reconcile their conflicting goals through mutual accommodation. The dynamics of this process is demand and concession; its objective is agreement. Unlike mere consultation, this bargaining process assumes willingness on each side not only to listen and to consider the representations of the other but also to abandon fixed positions wherever possible in order to find common ground."

Collective Bargaining Process

There are basically six steps involved in this process.
  • The negotiating team is organized to represent the union.
  • The mutual trust is gained between the employees.
  • Agreements are discussed between the representatives.
  • The agreement is proposed to the management.
  • The process of bargaining is initiated by the union.
  • Collective agreement is achieved when both the parties reach common grounds.
  • Legally based employer-union relationship is provided through such agreements.
  • The employees who are not the members of the trade union, need not pay service fees, but they can discuss on certain issues with their employer.
  • The employees have their right to bargain for wages and other work practices.
  • The employees are allowed to take part in the decision-making process of the management.
  • As the contract is legally bound, the employees and the management are required to adhere to the rules mentioned in the contract.
  • The authority of the management can be questioned, in case the employees are facing injustice.
  • The employees are prohibited from engaging in activities like striking, stopping and any uncivil methods of showing their frustration.
  • Before the employees opt for such negotiations, elections will be conducted.
  • Favoritism and victimization, which is prevalent in workplaces, can be reduced by this process
  • The decisions taken or proposed by the union need not always fall in line with the viewpoints of other individual employees.
  • The management's freedom in implementing certain ideas which can bring about constructive development for the company, may be hindered by the unnecessary involvement of employees.
  • The disproportionate effect between the active participants and inactive participants in the bargaining unit is definitely a disadvantage because, the decision being taken should have the entire representation of the employees.
  • This process promotes bureaucratism.
  • The progression in decision making is tampered, which may result in bad work culture and inefficiency.
  • It protects status quo, when privatization is involved which inhibits innovation.
  • Huge amount of money, which is associated with negotiations and agreements is spent by the management.
  • Dependence on private sector for technological services may be compromised.
  • Managing this process is not an easy task and it causes unnecessary troubles to managers and supervisors.
  • Under the disguise of unfairness and injustice, the workers may try to negotiate on high economic benefits which cannot be catered by the management.
When the organizational structure and design of the company is efficient, the need for such collective agreements will reduce. Though the partnership between the management and the employees can be strengthened through legal agreements, this process may not always be used for constructive purposes of building the efficiency of the employee. When the laborers are satisfied through collective bargaining without inhibiting and suppressing the management and the company's growth, it may even lead to technological revolution and innovation.