Collective Bargaining: Process & Agreements

Collective Bargaining

• Negotiations about working conditions and terms of employment between an employer, a group of employees, or employers' organizations and workers' organizations to reach an agreement
• The process involves representatives gathering to negotiate a collective labor agreement on employment terms and conditions

Collective Bargaining Process

• Begins with union recognition
• Includes local-level negotiation between union delegates and management
• May require external assistance, e.g., Ministry of Labor involvement, and third party engagement (conciliation)
• May involve mediation by a senior Labour Ministry negotiation specialist to offer solutions
• The last step is arbitration (IDT)
• Results in a collective agreement (CLA), a document or verbal agreement on specific points
  • contracts are not legally binding in Jamaica

Summary of Collective Bargaining

• Workers, through representatives, and managers create an agreement on wages, benefits, work conditions, and workplace rules
• The process starts with union recognition and concludes with an agreement
• Assistance from the Ministry of Labour is available through conciliation and mediation.
• Unsuccessful bargaining may be referred to the IDT to resolve the breakdown

Notes on Collective Bargaining

• Collective bargaining also takes place between unions representing sectors of the economy and sector employers, or between government and civil servant unions
• Regional unions may involve international bodies like the OAS, IMF, or World Bank

Reasons for Collective Bargaining

• Increase employee involvement in decision-making and strengthen shared governance
• Clearly define employment conditions to minimize uncertainty and resolve disputes effectively
• Create stable, secure, and binding agreements reflecting employee concerns, which cannot be unilaterally changed
• Used for legislative advocacy and lobbying

Intentions of Collective Bargaining

• Establish engagement rules between managers and employees
• Improve employment terms and conditions to foster a workable employee-management relationship
• Balance power by opposing management's power with the collective power of workers, leading to acceptable settlements
• Contain workplace conflicts by providing a structured method to handle disputes

Aim of Collective Bargaining

• Reach an amicable agreement
• LRIDA intends collective bargaining to foster harmonious manager-staff relationships

Prerequisites for Collective Bargaining

• Laws that permit freedom of association, enabling workers to unionize (Trade Union Act, 1919)
• Recognition of the union by the company, either formally by the Ministry of Labour or voluntarily
• Clear determination that no other union represents the bargaining employees

Conditions for a Smooth Process

• Good internal communication systems
• An understanding of negotiating in good faith to move the process forward
• A climate of observation of agreements to build trust
• Support from the Ministry of Labour in conciliation and mediation, with sensitivity in timing issues for the Industrial Disputes Tribunal
• Government establishes laws to facilitate manager-worker interaction

Aspects of Collective Bargaining

• Political aspects
• Economical aspects
• Governmental aspects
• Other aspects: include good faith bargaining, collective labour agreements, and work rules

Political Aspect of Collective Bargaining

• Works as a balance of power between employers and individual employees,
• Collective action provides greater power than individual bargaining
• Enables the numerical strength of the workforce to counter "Management prerogative"
• Unions achieve a better balance of power by collectively negotiating on employee's behalf

Economic Aspect of Collective Bargaining

• Determines the price of labor (wages, hours, terms), which is crucial for a country's economic planning
• Employers want to pay at their capacity
• Employees want to improve their living standards

Governmental Aspect of Collective Bargaining

• Establishes rules and procedures for industrial relations
• The outcome circumscribes employer and employee behaviors, per labor laws
• Government itself becomes an employer, with unions like JCTU bargaining for public sector employees

Good Faith

• Ensures that negotiations are handled honestly
• "In good faith" entails communicating, negotiating, and matching proposals with counter proposals to reach an agreement

Collective Labor Agreement (CLA)

• Unions and management negotiate terms of reference for a set period of time
• CLA signed by both parties includes points of agreement
• Unions and management adhere to the agreement for its duration

Work Rules

• Includes wages, salaries, conditions of employment, pay, work/lunch breaks, vacations Also includes:
• Work assignments
• Grievance procedures

Collective Bargaining Notes

• Negotiations determine earnings, working conditions, rules of behavior, and regulations
• Conflicts arise during CLA implementation, often due to ambiguous clauses, which parties must jointly resolve

Issues Handled

• Rights
• Interests
• Substantive terms and conditions
• Procedural rules
• Working arrangements

Rights

• Used to resolve issues already included in a previous collective agreement
• A claim under agreement where there is a negotiated right, but application or interpretation is disputed
• Issues are resolved through a procedural agreement/grievance resolution
• Examples include overtime pay conditions, agreed uniform allowances, and failure to pay retroactive adjustments

Interests

• A dispute relating to a new condition not currently covered in agreements
• Claims for something new/different
• Includes demand safety boots, uniform for the janitor, the provision of more jobs
• Can be rejected
• Issues can be placed on the claim in the next negotiation period
• Actual negotiations can be described as an interest dispute if previous CLA is about to expire and this is dealt with through bargaining

Substantive Terms and Conditions

• Relates to the regulation of "economic" relations like wages, hours, holidays, and benefits
• Trade unions and collective bargaining are often the primary source, gaining more than legislation or individual efforts

Procedural Rules

• Govern managerial relations, balancing management authority and employee participation in organizational decision making
• Rules define issues for joint regulation, their handling, and the roles of parties involved
• They introduce degree of certainty on managerial and employee relations
• They share power/authority not money
• Rules are set up for decision-making responsibility, grievances, discipline, redundancy, consultation, job evaluation

Working Arrangements

• Define the work, new technology, flexibility agreements and provisions by employees
• Features productivity, new technology and flexibility agreements, containing provisions relating to 'manning' levels, inter-job flexibility, time flexibility and contractor use
• Focuses on factors such as globalization
• Negotiation involves employee training for new technology or roles

Contents for Collective Bargaining

• Pay (salary, basic rates, layoff/guarantee/method/interval of pay)
• Premiums (overtime, shifts, weekend/holiday, call-in pay)
• Bonuses (piecework, measured day/group, commission, profit sharing)
• Allowances (working conditions, abnormal work, travel, tools)
• Hours (basic/normal working week, shift working, start/finish times, flex-time, breaks, overtime, on-call)
• Holidays (basic/service entitlement, qualifying days, holiday pay)
• Safety (protective gear, practices, injury benefits)
• Welfare (medical checks, canteen, changing rooms)
• Pensions (contributions, benefits, insurance, retirement)
• Notice (employer to employee, pay arrangements, length of notice, leaving early)
• Redundancy (consultation, selection, payments, redeployment, training)
• Job Description (job title, functions, responsibilities)
• Training (entitlement, craft training, payment of fees, block releases)
• Staffing (levels, flexibility, mobility, cover)
• Some items are Mandatory, others are Permissible,

Factors Influencing

• Union
• Management preferences
• Types of claims
• Environmental
• Socio-demographic trends
• Organizational factors

Management Goals

• Business preservation, control, stable relationship with bargaining agents, and promotion of social/economic goals

Unions Goals

• Preservation, formal purpose, more control over jobs, and broad social/economic aims

Stages in the Collective Bargaining Process

• Preparations (recognition)
• Negotiations
• Compromise
• Conciliation, mediation, and arbitration
• Settlement
• Administration of CLA

Levels of Collective Bargaining

• Differ depending on industry, country, union activities, governmental inclinations, and union strength
• Decentralized
• Centralized

Decentralized Bargaining

• Organizational level used in company, plant, multiple bargaining unit, departmental, joint, or single-table agreements

Company-Level Bargaining

• Pertains when all employees of the same type are under a single agreement

Plant-Level Bargaining

• Found in multi-site/industry organizations with varied work and employment terms

Multiple Unit Representation

• Several unions bargaining in one organization

Departmental Bargaining

• Relates to arrangements specific to departments

Joint-Representation

• Two unions negotiating for one bargaining unit

Single-Table Bargaining

• All unions agree to create an agreeable collective agreement

Summary of Multi-Level Bargaining

• Decentralized bargaining can be layered when a company has multiple branches; external conditions differ
• “Layered" keeps some things uniform
• Organizational bargaining is not confined to one level, and job or work problems are resolved locally.
• Multi-employer agreements are interpreted and applied locally
• Decentralized bargaining is most common in Jamaica

Centralized Bargaining

• Occurs at a national level
• In Jamaica, Joint Industrial Councils are used for sugar/bananas etc
• Ministry appoints wage/condition negotiations
• Unions have representatives assist at organization level

Notes on Centralized Bargaining

• Ensures common rules across the board, reinforcing a standard "rate for the job," based on job nature v. particular org's performance
• Helps organizations offer a united union response, while setting uniform wage levels and preventing unfair competition
• Determines actual wage rate, setting floor/safety net

Scope of Bargaining

• Unions negotiate for an entire bargaining unit
• Some unions propose a "Closed Shop," where all employees must join, though this is unpopular with labor & management
• Mandatory and permissive issues, along with these items, set the breadth of scope
  • Substantive terms/conditions (pay, hours, fringe benefits)
  • Procedural rules (CLA implementation, union meetings, grievance and disciplinary action).
  • Working arrangements (technology, staffing, and productivity)

Bargaining Strategies

• Traditional involves displaying relative strength by discussing wage levels, national agreements, profits, labor markets Negotiations:
  • Proceed with claims and counterclaims until compromise is reached Productivity: Includes
  • Employees making for more efficient work
  • Employers agreeing to upkeep equipment
  • Nature of negotiations shifts as there is no trade-off rather an attempt to avoid aggressive bargaining

Factors that Lead to Greater Productivity

• Flexible staffing, flextime/extended hours, output-linked incentives
• Unions face challenges, focusing on flexibility

Steps In

• Select a negotiation team
• Prepare negotiation demands
• Create a procedure
• Determine a strategy
• Draft agreement
• Administration

Negotiation Team

• Two teams essential, management and workers
• Includes workers office bearers
• Management includes hr, production and finance managers
• Chief executives outside either team
• Uneven representation

Preparation of Demands

• Important preparation
• Charter is presented to management, prepared in consult with employee, with outside expert if necessary

Procedure

• Typically involves a two-pronged process
  • Issues decided one by one(piece meal negotiation)
  • Negotiations handled altogether considering grand effect
• Authority during negotiations clearly described by management

Strategy

• Not specific, depends on market conditions
• The aim is on full understanding and ultimate results v. instant gains

Agreement

• Outcome to bargining is to draft up agreed results
• Legal jargon to be avoided
• Signed by both parties
• Communicated across parties

Administration

• Both employer and employee need to be concerned
• Under Section 29 of the LRIDA any person who commits a breach of any term of the settlement is punishable with imprisonment for a term which may extend to six months, or with fine, or with both.

CLA Contents (Jamaica)

• Though Jamaica does not recognize a CLA as legally binding, contains set standard clauses
  • Date and duration of agreement
  • Parties
  • Rights of parties - rights for both parties and clauses for security

Organization of Work (CLA)

• Related clauses for distribution of work
• Includes job and work organization

Technological Changes

• Advance notice to union and laid of employees
• Offer training and/or retraining
• Layoff protection
• Wage protection specifically related to technological change
• Special leave/Severance Pay/Pre-retirement (all due to tech changes)

Distribution of Work

• Flexibility of work assignment
• Job rotation
• Semi autonomous teams
• Job sharing

Labour Relations (CLA)

• Clauses for grievance and work environment and technological change
  • Grievance procedure
  • Bargaining methods
  • Application of agreement/Job evaluation and joint commitees

More CLA

• Education Training and Development - Finacial assistance, leave and reimbursement and more assistance funds
• Conditions of Work - Work schedules, overtime, job security, termination of employment, and work-family balance,

• Insurance, health and welfare

Agreement

• Document is drafted up by negotiations
• Rough draft signed, fine-tuning can be applied at this step
• Distributed once full official