Collective bargaining is an activity that takes place between workers and employers. It can be defined as the ongoing process by which workers and their employers negotiate to resolve disputes over workplace issues. These issues typically include compensation (wages and other pay, such as overtime, holiday pay, vacation pay, and benefits, which include health care and retirement); hours of work; and conditions of work (work rules, safety and health procedures, work duties, seniority provisions, etc.). The formal resolution of the disputes is written into a collective bargaining agreement or contract. In the United States, bargaining is done through a labor union (or employee organization) that the workers have chosen to represent them in dealing with their employer for collective bargaining purposes. It takes place under governmental labor relations regulations and is strongly influenced by prevailing economic and political conditions.
In the United States, labor relations are regulated by the National Labor Relations Act (NLRA), which covers private employers and the unions that deal with them, and by various federal, state, and local laws and ordinances, which cover the relationship between the public or government sector and the unions representing government employees. Under such regulations, labor-management relations in the United States focus on collective bargaining, which has evolved into two mutually supporting levels: (1) negotiating the bargaining agreement, or contract, and (2) enforcing that contract through the use of grievance and arbitration procedures and other means to ensure that the terms of the contract are followed. The average duration of a labor agreement is three years, but both shorter and longer contracts are frequent, depending on what the two parties agree on. As a result, bargaining for a new contract occurs every three years or when the contract expires. Contract enforcement bargaining takes place whenever problems arise in implementing an existing agreement.
Regardless of the type of employer and the legal restrictions that apply, collective bargaining follows the same general process, a sequence of activities that includes preparing, negotiating, and finalizing the agreement. Bargaining takes place under union staff or officers, who represent the workers, and management persons, representing the employer. These representatives, with their respective committees, meet together and conduct the actual negotiating. In the United States, the law regulates the conduct of the parties and how they behave relative to each other, but it does not regulate the outcome or final results of the bargaining. The results depend on the relative economic power of the two parties.
It should be recognized that collective bargaining takes place under a complex set of relationships between employers and managers, on one hand, and the workforce and the union, on the other. While basic relations between employers and employees exist in any enterprise, these relationships take on a special form when the workers have organized into a union. They have a degree of power in dealing with their employers that unorganized workers do not have. One school of thought considers the dynamics between the parties in bargaining as essentially a power struggle. Others, typically in human resource positions, consider the main purpose of bargaining as the maintenance of labor peace and minimization of conflict at the workplace.
The relationships existing between the parties are influenced by the prevailing political and economic conditions outside the business, the state of the overall economy, the employer’s competitiveness, and conditions in the local community. The motivations and expectations of each party in the bargaining process are usually quite different. Their positions, in turn, are heavily influenced by each party’s interests, that is, what each side thinks is important to its well-being and thus needs to protect and improve. Reaching a compromise that is acceptable to each side can be a difficult task. When this fails to happen, a strike or lockout usually occurs. In recent years, however, over 98 percent of contract negotiations were concluded without strikes or lockouts. Considerable skills are needed for an individual from either party to be an effective bargaining representative.
Workers, and therefore their union representatives, normally focus on bettering wages, maintaining benefits, and improving work conditions. In some situations, the financial condition of the employer exerts unusual pressures for concessions and other undesirable changes in the terms of the contract. Employers historically have been mainly concerned about maximizing profits (in the private sector) and maintaining workforce control (in all sectors). Employers naturally worry about how collective bargaining and the union’s power will impact these two objectives. This fuels their natural opposition to unions. Coupled with the enormous economic and political clout of corporations in today’s society, this opposition creates a formidable obstacle for unions to successful bargaining.
As this brief discussion of collective bargaining indicates, the representatives from management and the union are by necessity trained professionals who are familiar with labor law, understand the dynamics of interpersonal relations, are experienced in the bargaining process from both their own perspective and that of the other party, and are skilled at the art of negotiating. Either party may choose a labor relations lawyer to represent it in bargaining, but unions often fall back on trained staff, while management frequently uses human resource personnel.
Training for management positions in collective bargaining is commonly part of university-level programs in management, especially in personnel relations and human resource management. However, some companies still rely on on-the-job training for selected managers as preparation for collective bargaining. Preparation for a position as a union representative is considerably more varied. Some unions look to hiring and training college graduates with labor studies or industrial relations degrees. Others hire pro-labor lawyers and integrate them into the union’s bargaining philosophy. Still other unions prefer to promote promising members who have been active in their local unions to staff positions and to train them for collective bargaining roles. Finally, law schools offer a wide variety of labor law courses that prepare students for work in labor relations.
As in other careers today, the world of collective bargaining is in transition. Since the 1970s, economic changes such as the shift from manufacturing jobs to service-providing jobs, deregulation, free trade, and globalization, along with changes in political attitudes and the manner in which the federal government implements the NLRA, have resulted in layoffs, plant closings, and downsizing. This has reduced union membership, especially in the goods-producing industries. Unions that represent workers in retail trade and service industries and public sector unions are holding their own or growing. The net result is fewer and smaller-sized unions in the goods-producing sector. This has even led to the demise of certain unions, usually through mergers into larger unions. As a consequence, fewer companies are unionized, so less bargaining takes place. Thus, the number of job opportunities in collective bargaining has correspondingly declined. Such positions still exist, but they are harder to find. Properly prepared individuals can still find careers in collective bargaining and related fields, but it now takes an intelligent, well-planned effort to do so.
- Employment contracts
- National Labor Relations Act (NLRA)
- Strategic human resource management
- Betters, M. 1993. Contract Bargaining Handbook.Washington, DC: Bureau of National Affairs. Bureau of National Affairs. 1994. Primer of Labor Relations. 25th ed. Washington, DC: Author.
- Carrell, M. R. and Heavrin, C. 2001. Labor Relations and Collective Bargaining. 6th ed. Upper Saddle River, NJ: Prentice Hall.
- Feldacker, B. 2000. Labor Guide to Labor Law. 4th ed. Upper Saddle River, NJ: Prentice Hall.
- Rosenfeld, D. 1995. Offensive Bargaining. Silver Spring, MD: George Meany Center for Labor Studies.