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Managing Human Element at Work
Notes may provide ways in which wages could be adjusted to meet increase in the cost of living,
in which event they will constitute an agreed policy on this issue. They may link a part of
wage increase to productivity increase or provide for productivity gain sharing in other
ways, in which event they represent policy on aspects of productivity. Methods of dispute
settlement would reflect a desire for the peaceful resolution of disputes. In a more general
sense, collective bargaining (which has its supporters as well as its critics) is a critical
element in pluralism. As Harry Arthur’s explains:
“Why does pluralism place collective bargaining at the centre? Because, as adherents and
critics agree, in the pluralist vision, labour and management, as autonomous interest groups,
can and should jointly fix the rules of employment upon terms which represent an acceptable
compromise between their competing interests. But is this process of negotiation and
compromise a good in itself? Pluralists believe that it is, although their rationales vary:
collective bargaining replicates the processes by which conflict is and should always be
resolved in a democracy; it projects democratic values into the workplace; it preserves the
autonomy of social forces as against the pervasive influence of the state; it is faithful to -
but makes more acceptable by its mobilization of countervailing power - the conventional
marketplace techniques of economic ordering in a capitalist economy; it ensures the
participation, and thereby the moral commitment, of those most directly concerned with
outcomes; it represents a significant advance over abusive and oppressive unilateral employer
control.”
Collective bargaining, in as much as it promotes democracy at the enterprise as well as at
the national and the industry levels (depending at which level collective bargaining takes
place), is an important aspect of a sound industrial relations system.
7.3.5 Nature of Collective Bargaining
The ILO Convention No. 98 (1949) relating to the Right to Organize and to Bargain Collectively
describes collective bargaining as, “voluntary negotiation between employers or employers’
organizations and workers’ organizations, with a view to the regulation of terms and
conditions of employment by collective agreements.”
There are several essential features of collective bargaining, all of which cannot be reflected
in a single definition or description. They are as follows:
• It is not equivalent to collective agreements because collective bargaining refers to the
process or means, and collective agreements to the possible result, of bargaining. There
may therefore be collective bargaining without a collective agreement.
• It is a method used by trade unions to improve the terms and conditions of employment
of their members, often on the basis of equalizing them across industries.
• It is a method which restores the unequal bargaining position as between employer
and employee.
• Where it leads to an agreement it modifies, rather than replaces, the individual contract
of employment, because it does not create the employer-employee relationship.
• The process is bipartite, but in some developing countries the State plays a role in the
form of a counciliator where disagreements occur, or may intervene more directly (e.g.
by setting wage guidelines) where collective bargaining impinges on government
policy.
• Employers have in the past used collective bargaining to reduce competitive edge
based on labour costs.
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