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2. • Collective bargaining is process of joint decision making
and basically represents a democratic way of life in
industry.
• It is the process of negotiation between firm’s and
workers’ representatives for the purpose of establishing
mutually agreeable conditions of employment.
• It is a technique adopted by two parties to reach an
understanding acceptable to both through the process of
discussion and negotiation.
• ILO has defined collective bargaining as, negotiation about
working conditions and terms of employment between an
employer and a group of employees or one or more
employee, organization with a view to reaching an
agreement wherein the terms serve as a code of defining
the rights and obligations of each party in their
employment/industrial relations with one another

3. • Collective bargaining involves discussions and
negotiations between two groups as to the terms
and conditions of employment.
• It is called ‘collective’ because both the
employer and the employee act as a group rather
than as individuals.
• It is known as ‘bargaining’ because the method of
reaching an agreement involves proposals and
counter proposals, offers and counter offers and
other negotiations

4. Thus collective bargaining:
• is a collective process in which representatives of both
the management and employees participate.
• is a continuous process which aims at establishing
stable relationships between the parties involved.
• not only involves the bargaining agreement, but also
involves the implementation of such an agreement.
• attempts in achieving discipline in the industry
• is a flexible approach, as the parties involved have to
adopt a flexible attitude towards negotiations

5. Main Features:
• Collective bargaining is a group action
• Collective bargaining is an art.
• Collective bargaining is a complementary and not
competitive process.
• It’s a continuous and logical process.
• It’s a step towards industrial democracy: working
together, thinking together and deciding together.
• It’s a Bipartite process.

6. Scope of Collective Bargaining
• The scope of collective bargaining is very wide. Any
matter defining the relationship between the
management and workers may form a part of it.
• Broadly two type of issues/items may involved in
collective bargaining.
• Economic Provision: includes those provision which
affects the economic, financial, and professional aspect
of workers.(working conditions, rules and regulations)
• Political provisions or issues: these provisions relates to
the general administration such as division of authority
and Responsibility, workers participation in
management and power to challenge the decision
taken by management.

7. Others items being a part of collective Bargaining
• Allowance and leave rules
• Wage and salary structure
• Wage incentive scheme
• Lay off and retrenchment of workers
• Demotion, promotion transfer
• Grievances procedure
• Safety and health facilities
• Scheme of bonus, profit sharing and co partnership
• Maintenance of discipline
• System of performance appraisal
• Labour welfare schemes
• Schemes of social security
• Medical and compensation schemes.

8. Different aspects of collective bargaining
• The concept of collective bargaining need to understood in its
proper perspectives.
• There is a transformation in the process
• Earlier it was mainly focus on wages and working condition
however in recent times the process of bargaining is extended
to almost every area involving employer-employee relation i.e.
incentive payment, job security, job security, staff transfer,
promotion etc.
• To understand collective bargaining one require following
aspects
1. Parties to collective bargaining
2. Subject matter of collective bargaining
3. Objective of collective bargaining
4. Duration of collective bargaining

9. • Parties to collective bargaining; CB is a bipartite agreement which
involves two parties.
• Management or employer association and workers represented by
trade union or worker federation on the other hand.
• Both these parties directly involved in the process.
• Subject Matter of Collective Bargaining:
1. Setting out standards for employment: like determination of wage,
fixing working hour etc.
2. Regulating the employer-employee relation: provision for
enforcement of collective bargaining, recognition of union, methods
of settling industrial disputes, procedure of negotiations, giving the
preference to union members in recruitment, an undertaking of not
to resort on strike or lock out during the period. Etc.

10. • Objectives of collective bargaining: the prime objective is
to maintain co-ordial relationship between management
and workers and to settle dispute relating to wage and
working condition.
• It aims to safeguard the interest of workers through
collective action
• To ensure participation in trade union in industry.
• To introduce effective grievance handling procedure.
• Duration and issues involved in collective bargaining: it
refer for which the collective bargaining agreement remain
effective.
• There is a general tendency , on the part of union to have
agreement of short duration

11. Types of Collective Bargaining
• Collective bargaining is a positive give and take between workers and
employers.
• Distributive Bargaining: straight art of bargaining haggling over the
distribution of amount. It covers issues like wages, salary, bonus etc.
• Attitudinal Bargaining : here all negotiations efforts are being done to
change the thinking, approach and attitude of both management and
the employee union. So here the attitude of both the parties are
shaped and reshaped.
• Integrative Bargaining: there may be some issue in the organization
on which both management and employees are equally interested
or being benefitted.
• Inter-organizational Bargaining: It generally aims at resolving internal
conflicts. Even within the union, there may be differences between
groups. For example, skilled workers may feel that they are
neglected or women workers may feel that their interests are not
looked after properly. Within the management also, there may be

12. Function of Collective Bargaining
• Collective bargaining is a process of decision making and mechanism
for belonging the power between the employer and employee.
• Working together, sharing together, deciding together and earning
together.
• It helps to promote the cooperation and mutual understanding
between workers and management.
• It establish uniform condition for employment
• It promote stability and prosperity
• It increase the economic strength of employee and management.
• Provide fair rate of wages and amenities for workers.
• Promote prompt redressal of grievances
• It provide a solution to industrial sickness.
• It provide new methods of employment regulatory condition.

13. Arthur D Butler’s classification of functions of
collective Bargaining.
 As a process of social change: it attempt to re arrange the economic
relation between employer and employee
 As a process of peace treaty: settlement between the two conflicting
parties is basically a compromise brought out by the collective
bargaining process. Compromise represent a state to which each side
is prepared to descend from original strand.
 As a system of Industrial jurisprudence:
• CB brings civil rights in to industry.It’s a rule making process that
formulates terms and condition for employment.
• its a executive process as the labour trade union share the collective
responsibility,
• its also a judicial process which provide interpretation of agreement
by the court.

14. PROCESS OF COLLECTIVE BARGAINING
• Collective bargaining consists of negotiations between an employer
and a group of employees that determine the conditions of
employment.
• Often employees are represented in the bargaining by a union or
other labor organization.
• The result of collective bargaining procedure is called the collective
bargaining agreement (CBA).
• Collective agreements may be in the form of procedural
agreements or substantive agreements.

15. • Procedural agreements deal with the relationship between workers
and management and the procedures to be adopted for resolving
individual or group disputes.
• This will normally include procedures in respect of individual
grievances, disputes and discipline.
• Frequently, procedural agreements are put into the company rule
book which provides information on the overall terms and
conditions of employment and codes of behavior.
• A substantive agreement deals with specific issues, such as basic
pay, overtime premiums, bonus arrangements, holiday
entitlements, hours of work, etc.
• In many companies, agreements have a fixed time scale and a
collective bargaining process will review the procedural agreement
when negotiations take place on pay and conditions of employment

16. • It’s a continuous process
• The process start when the workers puts the charter of demand
through their trade union to the management
• Normally a fresh charter is submitted at the expiry of existing
agreement which continue till a new agreement is signed and
enforced.
1. PREPARE FOR NEGOTIATION
2. TO DECIDE THE SOURCE FOR COLLECTING INFORMATION AND DATA
3. IDENTIFICATION OF ISSUE ,PROBLEM AND OBJECTIVES TO BE
DISCUSSED AND DECIDED.
4. IDENTIFICATION OF NEGOTIATING TEAM
5. DECIDING THE NEGOTIATION PROCEDURE TO BE FOLLOWED
6. ENTERING INTO LABOUR MANAGEMENT AGREEMENT
7. FOLLOW UP ACTION.

17. FOLLOW UP
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18.  Prepare
• This phase involves composition of a negotiation team.
• The negotiation team should consist of representatives of both
the parties with adequate knowledge and skills for negotiation.
• In this phase both the employer’s representatives and the union
examine their own situation in order to develop the issues that
they believe will be most important.
• The first thing to be done is to determine whether there is
actually any reason to negotiate at all.
• A correct understanding of the main issues to be covered and
intimate knowledge of operations, working conditions,
production norms and other relevant conditions is required.

19.  Discuss:
• Here, the parties decide the ground rules that will guide the
negotiations.
• A process well begun is half done and this is no less true in case of
collective bargaining.
• An environment of mutual trust and understanding is also created so
that the collective bargaining agreement would be reached.
 Propose:
• This phase involves the initial opening statements and the possible
options that exist to resolve them.
• In a word, this phase could be described as ‘brainstorming’.
• The exchange of messages takes place and opinion of both the
parties is sought.

20.  Bargain:
• negotiations are easy if a problem solving attitude is adopted.
• This stage comprises the time when ‘what ifs’ and ‘supposals’ are
set forth and the drafting of agreements take place.
 Settlement:
• Once the parties are through with the bargaining process, a
consensual agreement is reached upon wherein both the parties
agree to a common decision regarding the problem or the issue.
• This stage is described as consisting of effective joint
implementation of the agreement through shared visions,
strategic planning and negotiated change.

21. Essential conditions for success of collective bargaining
• Collective bargaining can succeed only when the
management and trade union realize their responsibilities.
• There should be willingness of give and take for both the
parties.
• Existence of an organized and fully recognized trade union.
• CB is possible only in the an atmosphere of mutual trust
and recognition.
• There must be a maturity of leadership from both sides.
• The negotiator must have a problem solving and positive
attitude
• Intelligent collective bargaining specialized training of the
negotiators.

22. Theories of collective bargaining
• A number of bargaining models have their roots in
social psychology
• Some theories or models range from descriptions of
what occurs at the bargaining tables to complex
theories that make extensive use of mathematical
and economic models

23. • Walton and McKersie Theory
• Walton and McKersie4 view collective bargaining as four sub-
processes – distributive bargaining, integrative bargaining,
attitudinal structuring, and intra-organisational bargaining.
• Distributive bargaining applies to situations in which union and
management goals are in conflict.
• Integrative bargaining, on the other hand, refers to bargaining
issues that are not necessarily in conflict with those of the other
party.
• Attitudinal structuring is the means by which bargaining parties
cultivate friendliness,trust, respect, and cooperation.
• The final sub-process in Walton and Mckersie’sTheory is intra-
organisational bargaining wherein the focus is on interaction
between the union and management.
• These four sub-processes interact to help shape the final
outcome of collective negotiations as well as the long-term
relationship between union and management.

24. • Bargaining range theory has its roots with the late Professor A.C. Pigou.
Pigou’s
• bargaining range theory explains the process by which labour and
management establish upper and lower wage limits within which a final
settlement is made.
• The Union’s upper limit represents the union’s ideal wage. Management
will offer a wage that is well below that acceptable to the union.
• From these two extremes, the union and management teams will
normally proceed through a series of proposals and counter proposals.
• The union will gradually reduce its wage demands while the employer will
raise its wages offer.
• Both sides, however, have established limits as to how far they are willing
to concede, and in the process establish a sticking point.
• According to this theory, the exact settlement point will depend on the
bargaining skills and strengths of the union and management negotiators

25. • Chamberlain’s model focuses upon the determinants of bargaining power
and the ways in which changes in these determinants lead to settlement in
the majority of collective bargaining situations.
• Chamberlain defines bargaining power as the ability to secure your
opponent’s agreement to your terms.
• Thus a union’s bargaining power can be defined as management’s
willingness to agree to the union’s terms or demands.
• But what determines the willingness (or unwillingness) of management to
agree to the union’s terms? The answer, according to Chamberlain, depends
upon how costly disagreeing will be relative to how costly agreeing will be.
That is:
• Union’s bargaining power (UBP) = management’s perceived cost of
disagreeing with the union’s terms (MCD)/management’s perceived cost of
agreeing with the union’s terms (MCA)

26. • If management estimates that it is more costly to agree
than to disagree (that is, if the union’s bargaining power is
less than one), management will choose to disagree and
thereby reject the union’s terms.
• If, however, management judges that it is more costly to
disagree than to agree (that is, if the union’s bargaining
power is greater than one), management will choose to
agree.
• Management’s bargaining power can be similarly defined:
• bargaining power (MBP) = union’s perceived cost of
disagreeing Management’s with management’s terms
(UCD)/union’s perceived cost of agreeing with
management’s terms (UCA)

27. • Hicks Bargaining Model: focuses on the length and costs of
work stoppages. Hicks proposed that union and management
negotiators balance the costs and benefits of a work stoppage
when making concessions at the bargaining table.
• Each side makes concessions to avoid a work stoppage. The
central idea is that there is a functional relation between the
wage that one or the other party will accept and the length of
strike that would be necessary to establish that wage.
• There is a particular wage that the employer would prefer if
the union were not in the picture.
• He will concede more, however, in order to avoid a strike and
up to a point, his concessions will rise with the length of strike
he anticipates.
• A primary difference between the Hicks model and bargaining
range theory is that the Hicks model pinpoints a precise wage
settlement while the range theory does not.