For collective bargaining to be fully effective, there are certain essential prerequisites. These are given below:
Prerequisites
1. A Favourable Political Climate:
The government and the public opinion must be convinced that collective bargaining is the best method of regulating employment conditions.
The government should remove all legislative restrictions which hamper collective bargaining. It can also confer a right to bargain collectively, lay down the form and content of collective agreement, register these agreements and assist in their enforcement.
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If collective bargaining is to be fully effective, a favourable political “climate” must exist.
2. Freedom of Association:
Freedom of association is essential for collective bargaining. When such freedom is denied, collective bargaining is impracticable, and when it is restricted, collective bargaining is also restricted.
Freedom of association can be facilitated by removal of legislative restrictions on combinations where they exist, leaving workers and employers free to form associations as they please. Collective bargaining is not possible if employees are not free to form trade unions which are required to bargain with the employer on equal basis.
3. Stability of Trade Unions:
Workers may have freedom of association but, unless they make use of that right and form and maintain stable unions, collective bargaining will be ineffective. If a union is weak, employers can say that it does not represent the workers and will refuse to recognise it or negotiate with it.
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Before entering into agreements with a trade union, employers will want a reasonable assurance that it will be able to honour its commitments and this both implies that the union can exercise authority over its members and that its membership is sufficiently stable.
4. Recognition of Trade Unions:
Employers should be required by law to give recognition to representative trade unions. It is in the interest of an employer to give recognition to representative trade unions.
Once a trade union is strong enough, employers may decide that it is in their interest to recognise it and negotiate with it; otherwise, they may be faced with strikes and the ensuing financial losses may be far greater than the cost of any concessions on wages and conditions they may have to make in negotiations with the union.
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The granting of recognition may also have the positive benefit of improving industrial relations and this may manifest favourably in productions.
5. Willingness to “Give and Take”:
If one or both sides merely make demands when they meet, there can be no negotiation or agreement.
Each side normally puts forward claims which are intended to provide a basis for bargaining and as the negotiations proceed, one side will agree to reduce its demand on one item in return for some concession by the other side.
Willingness to “give and take” during negotiations does not necessarily mean that Concessions will be made by one side only.
One side may make greatly exaggerated demands which it will have to tone down considerably if agreement is to be reached. Also depending on the relative strength of the two parties, economic conditions at the time and skill in negotiation, one side may win more concessions than the other.
6. Mutual Recognition and Respect:
The facts that the management has the right to manage and the union has the right to organise itself and fight for justice must be fully recognised and accepted by both sides. Unless there is this basic unanimity of views, collective bargaining is mere trial strength.