Collective Bargaining

Collective bargaining typically refers to the negotiation, administration and

interpretation of a written agreement between two parties that covers a specific
period of time. This agreement or contract lays-out in specific terms the conditions
of employment, puts some limits on employees and restricts management’s
authority. It is the practice in which union and company representatives meet to
negotiate a new labour contract.

Collective bargaining consists of the process of negotiation between

representatives of union and employees in respect of terms and conditions of
employment of employees, such as wages, hours of work, working conditions and
grievance procedures and about the rights and responsibilities of trade unions.

Professor Allan Flanders argues that collective bargaining is primarily a political

rather than an economic process. It is power relationship between a trade union
organization and the management organization. The agreement arrived at is a
compromise settlement of power conflicts.

The process is ‘collective’ because representatives of employees and employers act

in groups rather than as individuals solve issues relating to terms and conditions of
employment. The term ‘bargaining’ refers to evolving an agreement using
methods like negotiations, discussions, exchange of facts and ideas, rather than
confrontation.

The process of collective bargaining is bipartite in nature, i.e. the negotiations are
between the employers and the employees, without a third party’s intervention.
Divergent viewpoints are put forth by the parties concerned, and through
negotiations, a settlement is reached. The objective is to arrive at an agreement.

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 labor and management may cooperate and work together over a certain
stated period.

It is also a judicial process for in 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 for both management and union undertake to implement
the agreement signed.
Thus collective bargaining:
i. Is a collective process in which representatives of both the management and
employees participate.

ii. Is a continuous process which aims at establishing stable relationships between

the parties involved.

iii. Not only involves the bargaining agreement, but also involves the
implementation of such an agreement.

iv. Attempts in achieving discipline in the industry

Collective Bargaining — History: From Period of Substitution to Post-

Economic Reforms and Structural Adjustment

The history of collective bargaining is as old as the history of trade unions in the
country. The growth and development of the process of collective bargaining has
progressed along with the four phases of trade union development-

i. First phase (1950s-60s)—period of substitution.

ii. Second phase (mid 1960s—79)—period of economic stagnation and political

instability.

iii. Third phase (1980-91)—period of uneven economic development.

iv. Fourth phase (1991 onwards)—post-economic reforms and structural

adjustment.

The phrase ‘collective bargaining’ was coined by Sydney and Beatrice Webb,
and according to their definition, it is a method by which the trade unions strive to
protect and improve the working conditions of the workers. In the initial
industrialization era, the workers had to fight with the management for their rights.

In the globalized scenario, the companies are increasingly realizing the need for
shedding the anti-labour attitude and working towards building cooperative and
cordial relationship with the trade unions and workers.

Since the onset of industrial revolution, the managements have the single point
agenda of improving the productivity and functional efficiency. Initially,
experiments had been carried out by Frederick Taylor and other management
theorists, who believed in scientific management.
The approach of scientifically measuring time, work, etc. had only resulted in
marginal improvement and over a period of time it got negated. These
developments were increasingly perceived as another method of exploitation by
the union leaders and employees.

The advent of human relations concept has led to the basic thought that employees
are human beings and they deserve to be treated properly and not like machines. It
is here that the human approach has assumed significance in union-management
relations.

The organizations after a lot of exploration and experimentation have come to a

consensus that the only way to improve productivity and maintain cordial
industrial climate is to engender a sense of commitment and involvement among
the employees. But to inculcate commitment, it is essential that the employees are
involved in the day-to-day management of affairs for bringing in the feeling of
being a stakeholder in the organization.

The organizations have for this purpose decided to democratize and decentralize
the decision-making process and thus pave the way for the process of participation
of workers in the management.

The advent of democratic governments has led to hopes and aspirations among the
employees for industrial democracy and thus workers’ participation in
management (WPM) has assumed more significance. It implies that the
organization follows participative and consultative decision making processes,
especially in matters pertinent to wages, working conditions, and jobs of workers.

It is an indication of mental and emotional involvement of an employee or groups

of employees, which would ultimately encourage their contribution to the goals
and objectives of the organization.

Workers’ participation in management tries to reduce the dichotomy created by

industrial revolutions, which led to watertight compartments called management
and operational workers or personnel. It tries to bring in synergy by addressing the
hopes and aspirations of the workers of being involved in the decision making
processes relating to wages and conditions.

The participation enhances the employee’s ability to influence decision makers and
the decision making process at different levels of hierarchy and also motivates the
employee to assume responsibility for his or her action. The participation can
mainly occur at three levels, that is, shop-floor level, departmental level, and board
level.

Collective Bargaining – Definitions: By Eminent Authors,

Encyclopedia of Social Sciences and ILO
The collective bargaining is another form of involving the employees in the
decision making exercise of the organization. In this process, the terms and
conditions of employment are determined by mutual agreement between employer
and employees. The idea behind this is that the employer and employee should not
make decisions unilaterally or with the intervention of any third party. It is a
bipartite in nature because only the employer and the employees are involved in
the bargaining process.

Collective bargaining is a process of negotiations between two or more parties

mainly employees or trade unions as representatives of employees and employers
or association of employers if applicable to discuss the issue relating to the terms
and conditions of employment in the industry.

The discussion takes place relating to terms and conditions of employment may
include such as – wage and salary scales, allowances, benefits, working conditions,
working hours, leave, health and safety measures, training, promotion, transfer,
overtime, facilities, opportunities for development or betterment, rewards,
recognitions, discipline, increments, bonus, etc.

The concerned parties at the decided place and time participate in discuss in
peaceful environment and try to reach to and an agreement over the issue of
conflict or difference. The solution to problem can be given through negotiation
and maintain good relations by removing differences.

This process is called collective bargaining. This process has been used in
European and USA countries for solutions of the labour problems time-to-time.
Now in the present, time it is used in developing countries like India, Brazil, South
Korea and Malaysia.

Collective Bargaining, an essential element of economic democracy is a ‘two

party’ procedure to arrive at a mutually agreed solution.
“Collective bargaining is essentially a process in which employees act as a group
in seeking to shape conditions and relationships in their employment.” (Dale
Yoder)

“Collective bargaining is a method by which trade unions protect and improve the
conditions of their members working lives.” (Sydney and Beatrice who coined the
phrase ‘collective bargaining’)

According to Harbinson, collective bargaining is “a process of accommodation

between two institutions which have both common and conflicting interests”.

“Collective bargaining is a process of discussion and negotiation between two

parties, one or both of whom is a group of persons acting on concept 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”. (Encyclopaedia of Social Sciences)

Collective bargaining means, “Negotiations about working conditions and terms of

Collective bargaining employment between an employer and a group of employees
or one or more employees organisation 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 relations with one another – Fix a large number of
detailed conditions of employment; and during its validity, none of the matters it
deals with, can in normal circumstances, be given as a group for a dispute
concerning an individual worker.” (ILO)

Collective bargaining is “the resolution of industrial problems between the

representatives of employers and the freely designated representatives of
employees acting collectively with a minimum of government dictation”. (Cox)

Collective bargaining can be defined as – “a process where workers’ representative

and management’s representative meet and treat at the bargaining table to
determine the arrangement of the working relationship between an employer and
employees in the workplace” (Salamon, and Leap). This involves setting the terms
and conditions of employment, putting systems in place to settle any conflict that
may arise and determining employees’ contribution to organizing the daily work
activities.

Collective bargaining is “a process in which the representatives of the employer

and employees meet and attempt to negotiate a contract governing the employer-
employee union relationship” (Fisher, Schoenfeldt and Shaw). The collective
bargaining process has always been known for its outcome, as it always ends up
determining die relationship between the union and the employer in regard to
wages, benefits, hours and working conditions, etc.

Collective bargaining, as a technique for the fulfilment of the needs and objective
of workers and employers, is an integral part of industrial society. It is in fact an
extension of the principles and practices of democracy to industry. It is a dynamic
process and is constantly expanding. However, “collective bargaining is a powerful
instrument for either good or evil. Its results will depend upon wisdom and
farsightedness with which the bargains are made.”

Main Participants Collective Bargaining: -

Earlier, the two parties i.e., employer and employees participated in the collective
bargaining. In the situation of non-settlement of the issues, the third party-the
government-came into picture.

The size of representation of the management in the collective bargaining tends to

depend on the size of the organization. In a small firm, for instance, the president
of the company often discharges this responsibility. In medium-sized
organizations, the personnel manager, who is often supported by outside legal
assistance, typically completes bargaining.

In large organizations, there is usually a sophisticated personnel department with

full-time industrial relations experts. In such cases, we can expect management to
be represented by the senior manager for industrial relations, corporate executives,
and company lawyers-with support provided by legal and economic specialists in
wage and salary administration, labour law: fringe benefits and so forth.

A bargaining team constituted of the officers of the local union local shop
stewards, and some representation from the national union usually represents the
union side. Again, as with management, representation is modified to reflect the
size of the bargaining unit.

In a small firm or for local negotiations covering special issues at the plant level
for a nationwide organization, bargaining representatives for the union might be
the local officers and a few specially elected committee members.

The third participant in the collective bargaining process is the government. In

addition to providing the rules under which management and labor bargain,
government provides a watchful eye on the two parties to ensure that the rules are
followed, and it stands ready to intervene if an agreement on acceptable terms
cannot be reached and the impasse undermines the nation’s well- being and
peaceful process.

Another participant to the collective bargaining is the presence of financial

institutions and more particularly banks. Although not directly involved in
negotiations, the banks set limits on the amount that the company can spend in
upcoming negotiations. Exceeding that amount may cause the banks to call in the
loans that had been made to the company. These results in placing a ceiling on
what management can spend.

Collective Bargaining – Role in Setting and Preventing Industrial

Disputes
On the basis of the experience of the advanced countries, where collective
bargaining is said to have made considerable advances, to identify some indicators
of mature collective bargaining practices.

Collective bargaining plays a vital role in setting and preventing industrial

disputes.

Specifically its importance is evident from the following:

(i) Increase the economic strength of unions and management;

(ii) Establish uniform conditions of employment with a view to avoiding industrial

disputes and maintaining stable peace in the industry;

(iii) Secure a prompt and fair redressal of grievances;

(iv) Avoid interruptions in work which follow strikes, go-slow tactics and similar
coercive activities;

(v) Lay down fair rates of wages and norms of working conditions;

(vi) Achieve an efficient operation of the plant; and

(vii) Promote the stability and prosperity of the industry;

(viii) It provides a method for the regulation of the conditions of employment of

those who are directly concerned about them;
(ix) It provides a solution to the problem of sickness in industry, and ensure old
age pension benefits and other fringe benefits;

(x) It creates new and varied procedures for the solution of the problems as and
when they arise — problems which vex industrial relations; and its form can be
adjusted to meet new situations. Since basic standards are laid down, the employee
is assured that he will be required to work under the stipulated audit;

(xi) It provides a flexible means for the adjustment of wages and employment
conditions to economic and technological changes in the industry, as a result of
which the chances for conflicts are reduced;

(xii) As a vehicle of industrial peace, collective bargaining has no equal. It is the

most important and significant aspect of labour-management relations, and extends
the democratic principle from the political to the industrial field;

(xiii) It builds up a system of industrial jurisprudence by introducing civil rights in

industry. In other words, it ensures that management is conducted by rules rather
than by arbitrary decisions.

Main features of Collective Bargaining:

i. It is essentially a group action and is initiated by the representatives of workers.

ii. The process is flexible and it provides for both parties a scope for Compromise
and facilitates a mutual give and take environment for final agreement or
settlement. According to Bakke and Kerr, ‘Essentially, a successful collective
bargaining is an exercise in graceful retreat—without seeming to retreat.’

iii. It is a two-party process, where both strive to arrive at an agreement for settling
a dispute, devoid of animosity and mutual hatred.

iv. It is a continuous process, which provides for building and sustaining

relationships between the management and trade unions with the common
objective of resolving employee grievances and plant problems.

v. It reflects implementation of industrial democracy. The workers are provided

with an opportunity for self-governance and a powerful tool which holds a check
for arbitrariness and unilateralism.

Types of Collective Bargaining

There are four types of collective bargaining:
Type # i. Distributive Bargaining:

It involves haggling over the distribution of surplus. Under it, the economic issues
like wages, salaries and bonus are discussed. In distributive bargaining, one party’s
gain is another party’s loss. This is most commonly explained in terms of a pie.
Disputants can work together to make the pie bigger, so there is enough for both of
them to have as much as they want, or they can focus on cutting the pie up, trying
to get as much as they can for themselves. In general, distributive bargaining tends
to be more competitive. This type of bargaining is also known as conjunctive
bargaining.

Type # ii. Integrative Bargaining:

This involves negotiation of an issue on which both the parties may gain, or at least
neither party loses. For example, representatives of employer and employee sides
may bargain over the better training programme or a better job evaluation method.
Here, both the parties are trying to make more of something. In general, it tends to
be more cooperative than distributive bargaining.

This type of bargaining is also known as cooperative bargaining. The integrative

strategies require that both management and the union drop combative attitudes
and adopt a genuine interest in the joint exploration of solutions to common
problems. To work effectively, integrative bargaining must become a way of life
for the two parties that include continual efforts to improve relationships through
regular discussions of problems at all levels and willingness to attempt to settle
these problems with third party interventions.

Solutions to the most difficult problems can be approached by establishing special

committees, whose members are drawn from both management and labour to study
the issues and determine the facts.

Type # iii. Attitudinal Restructuring:

This involves shaping and reshaping some attitudes like trust or distrust,
friendliness or hostility between labour and management. When there is a backlog
of bitterness between both the parties, attitudinal restructuring is required to
maintain smooth and harmonious industrial relations. It develops a bargaining
environment and creates trust and cooperation among the parties.

Type # iv. Intra-Organizational Bargaining:

It generally aims at resolving internal conflicts. This is a type of manoeuvring to
achieve consensus with the workers and management. 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 differences. Trade unions manoeuvre to achieve consensus
among the conflicting groups.

Collective Bargaining – 2 General Principles Laid Down by Arnold

F. Gampo: For Union & Management and Trade Union:
Arnold F. Gampo has laid down certain essential general principles of collective
bargaining.

These are:

Principle # 1. For Union and Management:

(a) Collective bargaining should be made an educational as well as a bargaining

process.

(b) The management and the trade union must look upon collective bargaining as a
means of finding the best possible solution and not as a means of acquiring as
much as one can while conceding the minimum.

(c) Both the parties to a dispute should command the respect of each other and
should have enough bargaining power to enforce the terms of the agreement that
may be arrived at.

(d) There must be mutual confidence, good faith and a desire to make collective
bargaining effective in practice.

(e) The two parties should meticulously observe and abide by all the national and
state laws which are applicable to collective bargaining.

(f) There should be an honest, able and responsible leadership. For only this kind
of leadership will make collective bargaining effective and meaningful.

(g) There must be mutual, understanding between two parties.

For the Management:

(a) The management must develop and consistently follow a realistic labour policy,
which should be accepted and implemented by all its representatives.

(b) The management should not assume that employee goodwill will always be
there for it.

(c) The management should not wait for the trade union to bring employee
grievances to its notice but should rather create the conditions in which the trade
union will not do so and should settle the grievances of the employees even before
the trade union brings them to the notice of management.

(d) The management should act upon the assumption that, in order to make the
trade union a responsible and conservative body, it is essential that it should be
fairly treated.

(e) While weighing the economic consequences of collective bargaining the

management should place greater emphasis on social considerations.

(f) The management should deal with only one trade union in the organisation.

Principle # 2. For the Trade Union:

(a) In view of the rights granted to organized labour, it is essential that trade unions
should eliminate racketeering and other undemocratic practices within their
organisation.

(b) Trade union leaders should appreciate the economic implications of collective
bargaining, for their demands are generally met from the income and resources of
the organisation in which their members are employed.

(c) Trade union leaders should assist in the removal of such restrictive rules and
regulations as are likely to increase costs and prices, reduce the amount that can be
paid out as wages and tend to make for low employment.

(d) Trade unions should resort to strikes only when all other methods of settling a
dispute have failed to bring about satisfactory results.

(e) Trade union leaders should not imagine that their only function is to secure
higher wages for their members and shorter hours of work and better working
conditions for them.  

Collective Bargaining – Advantages and Disadvantages

Advantages of Collective Bargaining:
The main advantages of collective bargaining are as follows:

1. Effective in Protecting and Promoting Interests of Workers:

Collective bargaining has contributed much towards protecting and promoting the
interests of workers, especially in regard to the terms and conditions of
employment. Unions in many countries of the world have successfully contracted
agreements with employers, for higher wages, improved fringe benefits and cash
allowances, job security, better physical working conditions, social security
benefits and so on. In many cases, the benefits accruing to the workers through
collective bargaining have been much better than those available or expected under
legislation or industrial awards.

2. Control of Management’s Autocracy:

Collective bargaining has increasingly usurped the prerogatives traditionally

enjoyed by the employers of unilaterally laying down the terms and conditions of
employment of their employees. Apart from wages, hours of work and working
conditions, many more subjects have come within the ambit of collective
agreements. Thus, collective bargaining has tended to impose a substantial check
on employers’ autocracy in taking decision over matters of concern of their
employees.

3. Promotion of Durable Industrial Peace:

Where the terms and conditions of employment of employees are determined by

mutual agreement and understanding between the employer and the union
representing the employees, the scope of further differences over the subjects of
agreement is considerably minimised. Besides, the parties are placed in a better
position to understand and appreciate their respective problems and difficulties,
which results in the development of a co-operative environment in the enterprise.

Solution of a contentious issue imposed from outside, such as an adjudication

authority, may not satisfy either or both the parties. Besides, most collective
agreements also provide for grievance procedure for redressing grievances arising
out of the interpretation or application of collective agreements. Thus, collective
bargaining is expected to ensure durable industrial peace in enterprises.

4. Conducive to the Enhancement of Managerial Efficiency:

Collective bargaining enables managers to understand the problems of the

employees in the right perspective. Similarly, the union is also enabled to
understand the genuine problems facing the management and the enterprise.
Negotiations taking place in frank and free atmosphere can reveal the areas of
deficiencies in managerial practices and thereby enable managers to adopt
appropriate measures to rectify them. Besides, the suggestions of the trade union
may provide a useful feedback.

5. Establishment of Industrial Rules and Creation of Labour Standards:

Collective bargaining has also been helpful in the establishment of industrial rules
and creation of useful labour standards. The rules and norms embodied in the
labour contract of one firm often lead to the establishment of similar rules and
norms in other firms, and the process goes on continuing.

In this way, a sort of uniformity in industrial rules and labour standards is

established on a wide scale. It has been experienced that labour standards
uniformly embodied in collective agreements of several firms on major issues of
concern of a large bulk of workers such as bonus, gratuity, provident fund and so
on have provided the basis for the adoption of legislation for ensuring their wider
coverage.

Disadvantages of Collective Bargaining:

Collective bargaining also results in certain disadvantages to the parties to
negotiate:

i. Strikes:

The strike creates a dilemma for those who have accepted the institution of
collective bargaining because it is difficult to have collective bargaining without
the right to strike. At the same time strikes can inflict considerable damage on the
public image. Much attention has been given to the problem of how to maintain
collective bargaining while preventing the damage that might be inflicted upon by
the strikes. No effective solution has been found yet.

ii. Based on Power and Conflict:

Collective bargaining is based on power and conflict and does the most for the
people who need it least. The stronger workers in the labor market could protect
the income of their skills while the weakest workers in the work force have very
limited ability to form unions and hence are unable to gain the benefits of
collective bargaining.
iii. Lacks Safeguards for Public Interest:

Collective bargaining does not contain sufficient safeguards for the public interest,
which might be ignored by collusion between strong unions and employers to fix
prices. In the U.S.A., where collective bargaining is a feature of industrial
relations, it is claimed that it has impeded the economy’s growth, imparted an
upward drift to the general price level and periodically imperilled the nation’s
health and safety.

Collective Bargaining – Suggestions for the Effective Functioning: Change in

Attitude, Efficient at Plant Level, Concentrate on Differences and a Few More

Suggestion # 1. Change in Attitude:

There must be a change, in the attitude of employers and employees. They should
realise that the collective bargaining approach does not imply litigation as it does
under adjudication. It is an approach which indicates that the two parties are
determined to resolve their differences on their respective claims in a peaceful
manner relying only on their own strength and resources; they do not look to a
third party for the solution of their problems.

Suggestion # 2. Efficient at Plant Level:

Collective bargaining is best conducted at plant level. The bargaining agents of

both the parties should be determined to arrive at an agreed solution of their
respective problems. The employers should be represented by the management and
the workers by their trade union. Both should know which one is the recognised
union, in case there is more than one in a plant; and this union, recognised in the
proper manner, should be the sole bargaining agent of all the workers in an
organisation.

Suggestion # 3. Concentrate on Differences:

Employers and employees should enter upon negotiations on points of difference

or on demands with a view to reaching an agreement. The trade union should not
make or put forward unreasonable demands. Any refusal to negotiate on the part of
either side should be looked upon as an unfair practice. Rigid attitudes are out of
place in a collective bargaining system.

Suggestion # 4. Rely on Facts:

Negotiations can be successful only when the parties rely on facts and figures to
support their point of view. The trade union should be assisted by such specialists
as economists, productivity experts and professionals, so that their case is properly
presented to the representative of the management. In order to bring this to pass,
the organisational set-up of a trade union will have to be changed; and the latter
should adopt a constructive approach at the bargaining table rather than the present
agitation or litigation oriented approach.

Suggestion # 5. Avoid Unfair Labour Practices:

To ensure that collective bargaining functions properly, unfair labour practices

should be avoided and abandoned by both sides. The negotiations between the
management and the recognised trade union will then be conducted in an
atmosphere of goodwill, which will not be vitiated by malpractices, and neither
side would take advantage of the other by resorting to unfair practices.

Suggestion # 6. Written Agreement:

When negotiations result in an agreement, the terms of the contract should be put
down in writing and embodied in a document. When no agreement is reached, the
parties should agree to conciliation, mediation or arbitration. If no settlement is
arrived at even then, the workers should be free to go on a strike, and the
employers should be at liberty to declare a lock-out. To restrict this right is to
inhibit and defeat the very process of collective bargaining.

Suggestion # 7. Honour the Agreement:

Once an agreement is reached, it must be honoured and fairly implemented. No

strike or lock-out should be permitted in respect of issues which have already been
covered in the contract; and the trade union should not be allowed to raise fresh
demands.

Suggestion # 8. Provision of Arbitration:

A provision for arbitration should be incorporated in the agreement, which should

become operative when there is any disagreement on the interpretation of its terms
and conditions. The disputes arising out of the agreement should be referred to an
agreed third party with a view to arriving at a final and binding decision.

Collective Bargaining in India – With Assessment

Collective bargaining is an experiment in industrial democracy. It is pre-requisite
for successful and peaceful industrial relations. However, its progress in India has
not been very satisfactory. Here as also in many other countries it got some
impacts from statutory provisions which laid down general principles of
negotiation, procedures for collective agreements and the character of
representation of the parties negotiating disputes.

Among the voluntary measures, tripartite conference, joint consultative board,

industrial committees and working parties at the industrial level have played a vital
role in the development of collective agreements concerned. They have been
entered at the plant level as well as at industry level. In Bombay and Ahmedabad,
industrial level agreements are more common.

Types of Collective agreements concluded in India:-

(a) Agreements which have been drawn up after direct negotiations between the
parties and are purely in nature for purpose of their implementation.
(b) Agreements which combine the elements of voluntaries and compulsion both.
(c) Agreements which acquire legal status because of successful discussion,
between the parties and under legal reference to industrial tribunals or courts.

Assessment of Collective Bargaining in India:

Except for the industrial relations legislation in some states where arrangements for
recognition of unions exit, there has been lack of statutory recognition of unions
for the country as a whole. There is also the lack of provisions requiring employers
and workers to bargain in “good faith”. It is therefore no surprise that collective
agreements have not made much headway in the country so far. Some historical
factors have also stood in the way of collective agreements having a greater share
in maintaining industrial harmony.

Collective bargaining in India is gradually extending its area and given proper
impetus, it is capable of leading the country to industrial peace and prosperity. It
follows therefore that conditions have to be created for the success of the technique
of collective bargaining for promoting industrial peace.

An important prerequisite of it is the encouragement to strong and powerful trade

unions and evolution of satisfactory arrangements for union recognition by statute
as also the creation of conditions in which such arrangements have a chance to
succeed. It is difficult to place reliance on the process of collective bargaining
without satisfying its pre-requisite adequately.
On the other hand, collective bargaining as it has developed in the West may not
be quite suitable for India; it cannot appropriately co-exist with the concept of a
planned economy where certain specified production targets have to be fulfilled.

Though it is argued that collective bargaining has grown in India due to the
statutory provisions, voluntary measures, Industrial Truce Resolution of 1962 and
the amendments to the Industrial Disputes Act, 1947, but its success is limited.

Causes for limited success of Collective Bargaining:

(a) Problems with Unions – Collective bargaining process mainly depend on the
strength of unions. But still there are not many strong unions in India. Indian
unions are marked with multiplicity, inter- and intra-union rivalry, weak financial
position and non-recognition. Weak trade unions cannot initiate strong arguments
during negotiations. There is usually no unanimous decision among workers to be
presented at the negotiating table.

(b) Problems from Government – The government has not been making any
strong effects for the development of collective bargaining. The government has
imposed many restrictions regarding strikes and lockouts, which is an obstacle for
the development of collective bargaining process.

(c) 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. And there are many such unions. To protect
their own unions all political parties interfere into the matters, creating their union
rivalries.

(d) Legal Problems – Now adjudication is easily accessible. As such now

collective bargaining process is losing its importance.

(e) Management Attitude – In India managements have negative attitude towards

unions. They do not appreciate their workers joining unions. As strong unions are a
must for collective bargaining process such an attitude of management hampers the
process.