Overview
Workers all over the world have often attempted to put pressure through a collective power so that their requests and demands can be heard. Such demands usually range from wages and salaries to terms and conditions of working. It is however important to explore the historical and current trends of collective bargaining so that a thorough understanding of the concept is brought on board (Calmfors & Driffill, 1988). In so doing, it will be interesting to note that there are some collective bargaining methods that have been abandoned altogether and new ones adopted due to changing needs of the working population.
Workers can use different alternatives to have control of their working conditions. Nonetheless, the use of labor organizations as vehicles through which workers can present their views and opinions is equally critical in this discussion. These are workers’ outfit associations which may largely be categorized as economic or political organizations (Golden, 1993). Workers’ unions which are political in nature tend to theoretically exercise their authority over such unions. These unions may fight for the rights of workers by staging political protests or seeking a consensus with the government of the day on ways through which the condition of workers can be improved. On the other hand, economic unions usually seek to attain the same objectives although such organizations prefer to interact on a one-to-one basis with the affected workers and employers. This paper explores the trends on how collective bargaining has been conducted in the past and its transition into the present time.
Dimensions of collective bargaining
Collective bargaining trends may take two broad forms. To begin with, the extent or level of centralization is an important dimension to put into consideration. This form of bargaining refers to the bargaining degree to which conclusions are made concerning formal agreements reached on both sides, that is between workers and the employer (Calmfors & Refill, 1988). The second dimension of collective bargaining is referred to as macro-coordination of collective bargaining. In this case, both the macro-economic and social objectives are synchronized and which is achieved through establishing definite bargaining levels within the economy.
Collective Bargaining Trends
Bargaining using a centralized approach or dimension is more common than macro-coordination of collective bargaining. However, it is more cumbersome to operate this dimension of collective bargaining. The main reason for this difficulty is that most countries have made use of multi-level bargaining for a considerable length of time. Hence, it is more challenging to measure the change in centralized collective bargaining. A large number of employees will often be catered for by a bargaining level that is thorough and therefore capable of recording positive results (Calmfors & Driffill, 1988). Unfortunately, historical trends reveal that quite a significant number of countries have not utilized the bargaining level which is beneficial to workers. Fluctuations that run for a short period of time have also been witnessed in some countries as far as this level is concerned. Moreover, bargaining degree which is unidirectional has also been experienced in some countries for a long period of time. Countries like Japan, Portugal, Austria, and the USA tend to experience very stable trends in collective bargaining from historical times up to the present. However, short-term fluctuations are common in Australia and Finland. However, long-term fluctuations have persisted in countries like New Zealand, Ireland, and Sweden. This implies that the decentralization approach to collective bargaining is more prevalent in most countries except Ireland.
Besides, it is also imperative to note that decentralization takes two forms namely the one that moves from the center to the industry edge while the other form is the one that shifts from the industry to the company platform. The company level of decentralization is less common bearing in mind that it was experienced by New Zealand and the United Kingdom only (Piekkola & Snellman, 2005). In the event that striking a formal centralization approach in collective bargaining is not possible, labor organizations have found themselves coordinating their abilities as an alternative way to seek redress to their working rights and privileges.
There are cases when there is a single employer who is involved in the dispute with workers. In such a case, the employer takes the initiative to negotiate on an individual basis. Collective bargaining entails several employers, binding decisions which have far-reaching effects on the multiple firms or a region, in general, are adopted (Traxler & Kittel, 2000). Collective bargaining on a multiemployer basis has been very prominent since the 1930s. This mode of bargaining has been very common especially in some parts of Western Europe.
Countries like Japan have not exercised this approach as such. Moreover, collective bargaining was also common in New Zealand and is still practiced in Australia. Sectoral bargaining is common in some parts of Europe and has been historically used for a considerable length of time (Carrell & Heavrin, 2008). On the other hand, companies have often participated in collective bargaining deals in regions located outside Europe.
Both sectoral and centralized bargaining has faced a myriad of challenges in the recent past. For instance, advances made in the field of technology, impacts of globalization, diverse origin, and lifestyle of workers among other factors have posed great challenges to collective bargaining. In some cases, there are some countries that have opted to reduce their support for labor organizations, therefore, complicating the initial working principles of these unions. Due to these emerging trends, workers have been compelled to negotiate for their wages, salaries, and working conditions based on the local conditions but not on global trends. Furthermore, there is an emerging trend whereby many countries are opting for wage-setting habits which are decentralized in nature. This is mainly caused by the market competition that is largely influenced by international factors leaving the local companies with no other option apart from adopting the relevant changes which benefit workers. This is a direct effect of a globalized world economy (Caisley, 2007).
However, individualized bargaining has not yet substituted bargaining at the industry level. Instead, there have been additions being made to the already established bargaining systems. This has been perpetuated within the industry and sometimes at the national level. Hence, current trends in collective bargaining are exhibited more at either the industry or national level.
Temporary unions served as labor organizations in the United States in the past. These short-term unions were constituted by workers themselves especially at the local level. Workers would come together to demand higher wages and salaries in addition to fighting for other fringe benefits. This was done in the absence of properly structured unions which as mentioned earlier, were temporary outfits.
Interestingly, the emergence of permanent unions did not seem to erase the old systems because the permanent unions had short life spans too (Carrell & Heavrin, 2008).
Whenever there was economic depression, a counterbalance would result between the early organizations and the need to remain economically vibrant (International Labor Office, 2003). Hence, workers had the tendency of joining labor unions which were political in nature especially when the economies were performing poorly. The need to establish labor unions that are permanent in operation has not recorded significant success in the United States compared to other countries.
The contemporary unions mainly differ in one aspect of the operation: there is a clear-cut difference in the way they determine which group of workers are inclusive in the process of collecting bargaining (Caisley, 2007). Unions which concentrate so much in class are more likely to include all categories of workers. Hence, general organizations are born out of such unions.
The Economic Framework
The economic ability of employees has been the main driving force towards collective bargaining in the United States since the 1930s (Colosi & Berkeley, 2006). This power is the one that enables employees to set limits for their wages and other working conditions. Although the National Labor Relations Act regulates the bargaining framework, the market forces may override this Act especially if globalization has greatly impacted the local scene. It is equally not easy to predict the effect caused by the act of collective bargaining due to quite a number of factors. Nonetheless, studies have revealed that there is a 10-30 % higher wage-earning in sectors where labor unions exist compared to those which do not exercise collective bargaining (Calmfors & Driffill, 1988).
References
Caisley, T.K. (2007). Collective Bargaining, Auckland: CCH New Zealand Limited.
Calmfors, L. and Driffill, J. (1988). Bargaining Structure, Corporatism and Macro- economic Performance, Economic Policy, 6:13-61.
Carrell, R.M. and Heavrin, C. (2008). Labor Relations and Collective Bargaining: Cases, Practice, and Law, New York: Prentice Hall.
Colosi, R.T. and Berkeley, E.A. (2006). Collective bargaining: how it works and why : a manual of theory and practice, New York: American Arbitration Association.
Golden, M. (1993). The Dynamics of Trade Unionism and National Economic Performance, American Political Science Review, 87:439-454.
International Labor Office (2003). Collective bargaining: a fundamental principle, a right, a convention, Geneva: International Labor Organisation.
Piekkola, H. and Snellman, K. (2005). Collective bargaining and wage formation: performance and challenges, New York: Physica-Verlag Heidelberg.
Traxler, F. and Kittel, B. (2000). The Bargaining System and Performance: A Comparison of 18 OECD Countries, Comparative Political Studies, 33:1154- 1190.