Business School 101: Collective Bargaining

Introduction

• Overview of collective bargaining in organizations
• Importance of negotiation for wages, working conditions, and employee benefits
• Focus on key questions about collective bargaining

Section One: Definition

• Collective Bargaining:
  • Process where employers and employees negotiate terms of employment
  • Often involves representatives from both sides, typically through a union
  • Aims to regulate working conditions, wages, hours, benefits, and worker rights
  • Protected by labor laws and international conventions in many countries

Section Two: Process

• Key Steps in Collective Bargaining:
  1. Preparation:
     • Union gathers member input on needs and priorities
     • Employer assesses financial implications and objectives
  2. Negotiation:
     • Discussions between employer and union representatives
     • Involves proposals and counterproposals to reach consensus
     • Focus on wages, hours, health benefits, job security, etc.
  3. Agreement:
     • Terms are formalized in a Collective Bargaining Agreement (CBA)
     • CBA is legally binding and requires ratification by union members
  4. Implementation:
     • Agreement is put into action; both parties ensure compliance
     • Union monitors adherence and addresses grievances
  5. Renegotiation:
     • CBAs are temporary, usually lasting 1-3 years
     • New terms are negotiated as the agreement nears expiration

Section Three: Strategies

• Strategies Employed in Collective Bargaining:
  1. Interest-Based Bargaining (IBB):
     • Focuses on mutual interests to create sustainable agreements
  2. Positional Bargaining:
     • Each side starts with a fixed position; can be adversarial
     • Often leads to compromises that may not fully satisfy either side
  3. Concession Bargaining:
     • Employers ask unions to accept reductions in conditions for job security
     • Common during economic downturns
  4. Distributive Bargaining:
     • Zero-sum approach where one side's gain is the other side's loss
     • Requires careful calculations to reach acceptable agreements

Section Four: Real World Example

• UAW and the Big Three Automakers:
  • 2019 strike against General Motors lasted 40 days, longest in 50 years
  • Workers sought better wages, job security, and healthcare benefits
  • Resulted in a new 4-year CBA with wage increases and bonuses
  • Highlighted the power and challenges of collective bargaining

Section Five: Summary

• Collective bargaining is essential for fair employment terms
• Effective through preparation, strategic negotiation, and collaboration
• Benefits both workforce and organizational success

Conclusion

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• Thanks for watching!