COLLECTIVE BARGAINING

AND EMPLOYMENT RELATIONS

Lecturer: Le Tran Tuan Anh
Faculty of Economics and Business
Learning objectives
• Discuss trade unions and collective bargaining
• Understand the steps of negotiation
• Know how to handle a grievance procedure
• Acquire knowledge of employment relation issues in various
Asian countries, especially related to collective bargaining

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 WHAT IS EMPLOYMENT RELATIONS?

It implies a long-term partnership among

people, and each partner plays a different

role in the organization and works

collectively to achieve the organization’s

goal and to improve the quality of work life

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WHY DO WORKERS ORGANIZE?

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 Main reason why workers join a union

Higher wages and

better working Job security Social need
conditions

Upgrading of skills Peer group pressure Self-fullfillment

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 TR A D E U NION

Organization of workers acting collectively, who seek to

protect and promote their mutual interests through
collective bargaining

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 Trade Union

Craft
union

House General
union union
Types of
unions

Industry Staff
union union

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 National and International Unions
• Most Union members belong to a national or international

union. These unions may be:

- Craft unions: labor unions whose members all have a

particular skill or occupation

- Industrial unions: labor unions whose members are

linked by their work in a particular industry

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 Collective bargaining
❖ Definition
Negotiation between an employer and workers or their
representation about working conditions and terms of
employment “in good faith”.
❖ Perspectives of collective bargaining
• Behavioral perspective
• Economic perspective
• Legal perspective

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 Perspectives of collective bargaining

❑ Behavioral perspective: Collective bargaining may be perceived as a balance

of power between the employers and employees
❑ Economic perspective: The outcome of collective bargaining reflects labor
market conditions
❑ Legal perspective: In many countries, collective bargaining is a legal
requirement under the employment law and procedures

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What is good faith bargaining?
➢ Both parties communicate and negotiate

➢ They match proposals with counterproposals in a

reasonable effort to arrive at an agreement

➢ It does not mean that one party compels another

to agree to a proposal or make any specific

concessions

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Process of collective bargaining

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 Negotiation process
Negotiation is a process of discussing a subject matter with
the objective of reaching an agreement

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 Negotiation process
Steps in negotiation

• Preparation
1

• Presentation
2

• Exchange and compromise

3

• Reaching an agreement
4

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 Negotiation process
Ways to settle dispute
 Mediation: A process in which a third party helps the negotiation parties to
reach an agreement

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 Negotiation process
Ways to settle dispute
 Conciliation: A process in which a third party helps the disputing parties to reach
a mutually acceptable agreement

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 Negotiation process
Ways to settle dispute
 Arbitration: A process whereby a third party settles a dispute by making an
independent decision for the two parties

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 Grievance system
❖ Grievance
• Any factor involving wages, hours, or conditions of employment that
is used as a complaint against the employer
❖ Sources of grievances
• Absenteeism

• Insubordination

• Overtime

• Plant rules

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What will happen when bargaining break down?

Strike: a collective
decision by union
members not to work
until certain demands or
conditions are met

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 The employment relation issues in some Asian countries
Vietnam
Employment contract Collective agreement
▪ Employers must sign employment Types of enterprise
contracts with their employees ▪ State-owned enterprise
▪ Types of employment contract ▪ Enterprise employing 10 or more
➢ Definite period employees
➢ Indefinite period ▪ Enterprise with foreign capital
➢ A seasonal job of less than a ▪ Enterprise in industrial zone or
year export processing

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 The employment relation issues in some Asian countries
Japan
▪ Lifetime employment and the seniority-based
systems
▪ Labor contracts are applied when the number of
union members exceeds 75% of the total number
of regular employees in the company
▪ Spring struggle (Shunto): an annual wage
increase drive conducted from March to May

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 The employment relation issues in some Asian countries
China
• A tripartite system was introduced
Ministry of
Labor
in the early 1990s
All China
Federation of
• Chinese trade union exists two basic types of Chinese Trade Unions
Enterprise
economic systems Directors'
Association
➢ Public economic system
➢ Private economic system

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