Category: Collective Bargaining

Analysis of the Union Certification Process

This is issued by the government through the board of labour relations in that the union has the capacity to operate as a bargaining authority for all workers. This is because it has the mandate from the majority. The process of Union сertification has different unified stages that drive it and below are well detailed procedures to be followed during the process of Union certification:

• Cards of membership. The first requirement for any Union is the membership card which shows that a certain employee is a signed fully fledged Union member. Any card of membership is dated and signed by the owner and stipulates that the worker’s should be represented by the Union. The Union keeps all the cards of workers in a suggested bargaining unit together with the Union application to the agency (Visser, 2011).
• Application for certification. With the membership cards, the application must be filed by to the agency clearly stating the data which includes the overview of the suggested bargaining Unit (Visser, 2011). The number of workers that are believed to be recruited in that Unit and together with the details which shows the mechanism of conducting a secret ballot voting process of all workers.
• Secret ballot voting. The board analyses the application if it will be successful and whether the Unit suggested by the Union will be valid for collective bargain. This should also be embarked by 40% of the workers in the Unit. If all pre requisites are met, the board will issue the mandate for the vote of all workers on the fifth day following the date of application.
• Failure or success. The results from the voting process are gathered. E.g. if the Unit is comprises of 200 workers but on 20 turn up to cast their votes, if 12 or more of those workers vote in favour of the Union, then the Union will be authorised to represent all 200 workers. As the majority cast towards the Unit, then the application will proceed.
• Employers and Union collective bargain. If the Union is authorised to show up on behalf of its members, there is full mandate to negotiate in a good way. This gathers all employees’ issues during work. E.g. salaries, wages, working hours, health issues, benefits etc.

The bargaining process might take a long time lag as long as the employer bargains in a positive way, there are no attachments to agree any contract. Several sectors employees contain a different legal rights to bring a Union to represent them in the process of negotiation with their employer. The agency prohibits certain characters from the employer in order to ensure that there is a good climate for all employees to choose if to unionise or not. Specifically, employers should not look forward to compel a worker from becoming a member of the union by any way of the means below:

1. Intimidation. This is an act where employers try frighten employees in order to persuade them support the union.
2. Threatening. Employers always do acts that force employees to accept the process of unionisation.
3. Dismissal. Employers can promise to chase or end the contractor with the employees. This may force the worker to support the process of unionisation.
4. Salary or wage increment. This acts as a motivation to workers in a way that they support the union.
5. Setting of unwanted conditions of unemployment. There should not be any kind of engagement to eliminate joining are leaving from being a member of the Union. The board will intervene whether the employer has put pressure on employees.

Like other employers, unions are also prohibited from committing unlawful labour practice. E.g. unions have no mandate to organise employees at their work places without employers will. Though, it does not imply that workers are protected from talking about the advantages of unionisation. During the process of unionisation, there are restrictions that apply to the union during the certification:

• Violating employees in their dairy working conditions from their rights in order to support the unionisation e.g. threatening workers or chase them because of failure to support the union. Restraining an employer in their favour of bargaining representatives in a way of meeting leaders only on behalf of employers.
• Persuading employers to under look an employee for encouraging membership e.g. telling employers to penalise workers who are not part in the process of unionisation.
• Denying to involve in a good way during collective bargaining e.g. refusing to turn up for bargaining consensus with employers.
• Strike practices during collective bargaining.
• Involving employers to pay for un done work.
• For the union that is not authorised to represent a set of workers, in an act to recognise them in order to support the union.
• Frequently, groups of workers come together as a bond to address and negotiate common needs with employers.

In the process of unionisation, employees can be more inefficient in the process of negotiations than individuals. Collective bargaining is the process where by all employees negotiate with employers on the terms and conditions of employment. This entitles the process through which its done and its done as follows:

1. Preparation. At the starting point, all representatives of each party prepares the talks to happen during the meeting. Every member is mandated to be well versed with points to be discussed during the meeting and should bear information of the workers’ laws. The board should be well organised with the change proposals required for terms and conditions of employment bearing that qualitative information to support its stand. The union must collect valid information regarding the financial status of the business alongside with its potential to pay and prepare a full report on issues and needs of employees.
2. Discuss. All parties come up with rules that will govern the negotiations and the negotiator is from the board who is mandated to chair the discussion. On the other hand, the issues could pension, health insurance etc. other administrative issues include; changes in technology, job safety and working conditions.
3. Propose. At the point, the lead negotiator starts the conversation with a beginning statement and thereafter all parties stipulate their needs (Doellgast., Nohara., and chobanian, 2009). This activity can be referred to as brainstorming. This is where every party lays down its ideas which leads to arguments.
4. Bargain. The negotiation starts on this stage, whereby every party tries to overtake each other. The process can last for days until the final contract is reached. Sometimes, parties draw a solution but the third party comes in to settle the disputes.
5. Settlement. This is the last stage of collective bargain process, where all parties come in agreement of the solution to all problems discussed about. The agreement is made between the employer and the employee which must be signed by both parties in order to show the will of acceptance (Doellgast, 2012).

In order to get problems solved, the board must follow the above discusses steps in order to empower workers with equal rights to bring out their minds.

Reference

1. Visser, j. (2011), ‘ICTWSS: Database on institutional characteristics of trade unions, wage
2. Setting, state intervention and social pacts.
3. Doellgast, v. (2012), Disintegrating Democracy at Work. Labor Unions and the Future of Good Jobs in the Service Economy, Ithaca, NY: ILR Press.
4. Doellgast, v., h. Nohara., and tchobanian, r. (2009), ‘Institutional change and the restructuring of service work in the French and German telecommunication industry’, European Journal.

Collective Bargaining in India

The Supreme Court of India defined Collective Bargaining as “the technique by which dispute as to conditions of employment is resolved amicably by agreement rather than coercion” [1]. The process of collective bargaining involves discussion and negotiations between workers and employer regarding the terms of employment and working conditions. The trade union is generally used to represent the workers to express their grievances regarding conditions and wages before the employer and management. It is considered to be an unfair labor practice as per the Industrial Disputes Act, 1947 (IDA) if the employer refuses to bargain with the trade union. It is an effective system as it helps employers to resolve the issues of the workers because it mostly results in undertaking actions [2]. However, the legal procedure is complicated in India for pursuing collective bargaining.

Stages of Collective Bargaining in India

Charter of Demands

The Charter of Demands essentially means the document that mentions the requirement of the workers in the industries regarding the issues relating to wages, bonuses, allowances, working hours, benefits, holidays etc. Generally the union notifies the call for the collective bargaining. After this the ‘Charter of Demands’ is drafted after discussion and consultation with the union leader.

Negotiation

Negotiation begins after the submission of Charter of Demands by representative of trade union. Before negotiating, preparation is done both by employer and unions by collection of data, policy formulations and strategies for negotiation. This process takes much longer time when multiple unions are involved. For example, it may take months or even years for public sector.

Collective Bargaining Agreements

After the negotiations are over, both the employer and the union representative will have to enter the agreement.

Strikes

If both parties fail to reach a collective agreement then the union may go for strike. But proper notice has to be given prior to the strike to allow the employer to make decisions and it is called ‘cooling period’.

Conciliation

A conciliation proceedings will begin after receiving strike notice from the union. Based on this Board of Conciliation will be appointed with equal numbers of both parties. No strike can be conducted during the conciliation proceedings.

Compulsory Arbitration or Adjudication

When conciliation fails parties can go for voluntary or compulsory arbitration. Arbitrator makes recommendations to parties without their consent and both parties must accept to the conditions set by the arbitrator.

Collective Bargaining Agreements in India

1. Bipartite or voluntary agreements. It is drawn up in voluntary negotiations between employer and the trade union. It is generally easy for implementation because both parties accepted it voluntarily.
2. Settlement. It is tripartite in nature because it also involves conciliation officer. They generally arises for specific disputes, which is referred to the officer for reconciliation.
3. Consent awards. When an agreement is reached while the dispute is pending before a compulsory adjudicatory authority and incorporated into the authority’s award it is called as consent awards. Even though the agreement is reached voluntarily it becomes part of binding award pronounced by the authority constituted for the purpose.

Contents of Collective Bargaining Agreements

After the agreement is reached a memorandum of settlements is drafted which enumerate the various clauses that tells the relationship between trade union and employer. Typical clauses in the memorandum of settlements are as follows:

• The duration of the memorandum of settlement that has been agreed by the parties.
• The terms regarding settlement with respect to wages and other payment related activities has to be mentioned. Also arrears with respect to work hours, concession has to be included.
• In case of strikes and lockouts of trade union, the conditions for the same has to be mentioned.
• The obligation raised by the trade union.
• The obligations of the employer regarding the terms.
• The penalties regarding the breach of agreements of employer and trade union.
• The dispute resolution method has to be mentioned the clauses.

Levels of Collective Bargaining in India

National Level Industrial Bargaining

This is centralized bargaining unit. Common in core industries such as banks, coal, steel, ports and docks and oil where central government employments are dominant.

Industrial Cum Regional Bargaining

Generally takes place in tripartite form. Common in industries where the private sector dominates such as cotton, jute, textiles, engineering, tea plantation, portsiiand docks.

Enterprise or Plant Level Bargaining

It takes place within the particular industry where problem arises. Bargaining takes place between one or more unions with the employer of management. Takes place only in private industries.

Unit level Bargaining

This is decentralized bargaining system. Generally takes place in MNC’s belonging to IT industry and bargaining generally takes place at individual level.

The Problem of Decent Wages

The Council of Europe is not an institution of the European Union. It was founded in 1949 and one of its main goals is to protect human rights and work towards the standardization of legal and social protection in all its 46 member states. In 1965 the ‘European Social Charter’ entered into force. Article 4 paragraph 1 speaks on the “right to fair compensation’ and urges the signatory states: ‘Recognize workers’ right to compensation which will enable them and their families to enjoy a decent standard of living”. “The Council of Europe can examine the remuneration systems of the member states and assess whether they provide fair remuneration for their work based on their dignity”. For example, the Council of Europe concluded that in 2002 the national minimum wage in the UK (based on the rate in force in 2000) was too low to comply with Article 4. It also stated that it could not properly assess the situation in UK Britain because it failed to provide data on the net minimum wage of a non-family worker.

But the UK is not alone in this. In a recent summary of decisions taken under paragraph 1 of Article 4, the European Committee of the Council of Europe on Social Rights also concluded that Austria, Greece, the Netherlands, Slovakia and Spain did not comply with the Wages Directive. However, he refrained from reaching a conclusion on the situation in Denmark, Germany, Iceland and Norway pending further information.

If a country is unable to comply with the Social Charter, it should submit a timetable and publish a process showing how and when it can comply with the requirements of the Charter. The European Committee gives several some many warnings, recommendations and additional recommendations to ensure that this country acts by following per under the ‘Social Charter’.

Surprisingly, such regular assessments of the state of respect for social rights throughout Europe remain so restrained. Their reports cite cases of non-compliance with Article 4, paragraph 1, and also contain information on non-compliance by many countries with other provisions of the Social Charter, but it is doubtful that many trade unions across Europe are aware of this. The situation is similar with the issue of a ‘decent wage threshold’: it is clear that the discussion of this ‘threshold’ and the decision to change it are considered to be very much internal issues of the Council of Europe Committee on Social Rights and does not spread wider. Collective bargaining in solidarity. The main purpose of collective bargaining is to protect workers’ wages from inflation and to provide them with at least some of the benefits of any productivity gains. This is the basis of the guidelines adopted by the ETUC and several European trade union federations to coordinate the collective agreement. At the same time, attention is focused on increasing average national productivity, rather than on changes in labour productivity in specific sectors of the economy. The rationale for this is that low productivity industries must keep pace with high productivity industries.

This is a particularly important issue for the public service sector, where even achieving a widely accepted measure of productivity growth is a challenge. It is in this sector that several some many very important professions are employed, such as social services, which, however, is considered low productivity if the standard for measuring tools applied to them.

Solidary collective bargaining has come under pressure in recent years as governments and employers seek more localized elements of collective bargaining in centralized national and industry negotiations. In public services, deregulation and privatization have also contributed to the continuation of this trend of less wage bargaining at the local level, or of undermining collective bargaining, as well as of workers hired by outsourcing companies themselves being hired by organizations to apply collective agreements with even worse wages and working conditions, or avoid any collective agreements at all.

In general, since the 1970s, the long-term trend has been to reduce the share of wages in national income, as wage in many European countries lags behind productivity growth (Thorsten Schulten, 2002).

This, in turn, has an impact on the economy as a whole and, in particular, has become a hotly debated topic in Germany.

The Trade Union, backed by researchers in Germany, France and Switzerland, has highlighted the economic role of wages in its ‘Theses on European Minimum Wage Policy’. They note that businesses increasingly view pay simply as “a factor in production costs and a variable in the international competition for company locations”. Thus: “the economic function of workers’ wages is pushed into the background as a significant component of national economic demand, without which a prosperous economy is impossible”. There is also the issue of getting a ‘decent income’ and the fact that workers are not a commodity, and that their income should not simply be left at the mercy of the market. The neoliberal argument is for markets to work, through the logic of a German website created to encourage people to apply for jobs by terminating other employees.

Even in some public service sectors, employers acknowledge that wage-setting cannot simply be left to the market. A study by the Bilateral Commission on Local Government Salaries (October 2003) on the state of wages in municipalities in the UK states: “Comparison of markets and their assessment it must be done scrupulously. The fact that it is possible to hire workers at a lower rate than what is offered is not a necessary indication that the proposed rates are too high”.

The International Labor Organization (ILO) points out why employers can support the minimum wage check as “to increase productivity by motivating workers’ and as a factor in ‘Reducing labour change’, which can be very costly for firms”.

Average hourly wages in 2017: 1) in EU countries – 26.76 euros per hour; 2) in the euro area countries – 30.33 euros per hour. Thus, the average salary in the countries of the European Monetary Union is higher than the EU average. According to the statistical agency Eurostat, in the first quarter of 2020, the largest increase in average wages was recorded in Romania (13%), Latvia (11%) and Hungary (10%). They are followed by the Czech Republic and Lithuania with a growth of 9% and Slovakia with a growth of 8.5%. For the first quarter of 2020, wage growth in the euro area countries was 2%, and in the EU countries (EU-28) – 2.7%.

To find out if the Council of Europe wage levels is adequate in a given country, its European Committee of Social Rights (SEBS) has proposed that 68% of gross average earnings be considered the norm. This was reminiscent of the definitions used by the OECD, namely two-thirds of the average earnings of full-time workers. The Council of Europe definition has gained some acceptance and has certainly become a key target for low-wage activists in the UK. However, according to the Council of Europe, it was never just a matter of assessing, for example, whether the national minimum wage was above or above this threshold. The Council of Europe Committee on Social Rights (ECSC) has said it wants to take other factors into accounts, such as taxes and social benefits. This proved to be an impossible task and the ECSC announced that it was unable to determine whether or not governments were providing sufficient revenue.

This committee then prepared another benchmark – 60% of net average earnings. The decision to make this change was attacked in the UK by low-wage activists. Carol Murray of the Scottish Low Wage Group said: “This group believes that such a redefinition not only hides the overall effectiveness of a decent wage threshold as a means by which poorer European citizens can hold their governments accountable for their policies but also bury the usefulness of the definition as a tool for analysis of unnecessary complexities that can only be revealed by statisticians in the service of the Member States” (Radical Statistics, No.85, 2004).

Thus, a key feature of any set goal should be its comprehensibility and ease of assessment when checking the salary level. This is especially important if the aim is to set goals or objectives for collective bargaining, lobbying and campaigning across Europe. “This group believes that this change in definition does not only serve to hide the overall effectiveness of a decent wage threshold as a means of which poorer European citizens can hold their governments accountable for their policies but also buries the usefulness of the definition as a tool for analysis among unnecessary complexities that only statisticians in the service of Member States can hope to resolve” (Radical Statistics, No.85, 2004).

Provisions on Organisational Rights and Collective Bargaining: Argumentative Essay

Introduction

In this assignment, I was asked to critically engage with the Labour Relations Act (LRA)[footnoteRef:1] provisions on Organisational Rights and Collective Bargaining. Having read the two cases that I was asked to analyze, it will be better for me to start with the first one then move to another. [1: Act 66, 1995 (“the Act”).]

I will give clarity about organizational rights and collective bargaining. Define the workplace and deal with different sections from the Labour Relations Act, (LRA)[footnoteRef:2] and the Constitution[footnoteRef:3] of the Republic of South Africa. [2: Act 66, 1995.] [3: Constitution 1996.]

The early twentieth-century patent the security of worker’s rights to form trade unions and engaged in collective bargaining were restricted to white employees. South Africa did not recognize or endorse freedom of association and collective bargaining. The democratic elections in 1994 surfaced the way to success, a task team was selected to restructure the labour legislation. After doing that, South Africa became a leader in applying international constitutional and labour standards[footnoteRef:4] cliffdekkerhofmeyr.com. [4: https:// www.cliffdekkerhofmeyr.com/en/news/publications/…]

The Labour Relations Act,[footnoteRef:5] was followed by the introduction of various Acts, Basic Conditions of Employment Act,[footnoteRef:6] 75 of 1997, Employment Equity Act,[footnoteRef:7] 55 of 1998 and Skills Development Act,[footnoteRef:8] 97 of 1998. [5: Act, 66 of 1995.] [6: Act, 75 of 1997.] [7: Act, 55 of 1998.] [8: Act, 97 of 1998.]

Organizational Rights

Organizational rights are the umbrella term for a number of rights deliberated to trade unions. A registered trade union who seeks organisational rights at the workplace needs to comply with section 21[footnoteRef:9] of the Labour Relations Act (LRA). [9: Act 66, 1995, Exercise of rights.]

Sec 21(1-10) state the following:

1. Any registered trade union may notify an employer in writing that it seeks to exercise one or more of the rights conferred by this Part in a workplace.
2. The notice referred to in subsection (1) must be accompanied by a certified copy of the trade unions certificate of registration and must specify-
   1. a) the workplace in respect of which the trade union seeks to exercise the rights;
   2. b) the representativeness of the trade union in that workplace, and the facts relied upon to demonstrate that it is a representative trade union; and
   3. c) the rights that the trade union seeks to exercise and the manner in which it seeks to exercise those rights.
3. Within 30 days of receiving the notice, the employer must meet the registered trade union and endeavour to conclude a collective agreement as to the manner in which the trade union will exercise the rights in respect of that workplace.
4. If a collective agreement is not concluded, either the registered trade union or the employer may refer the dispute in writing to the Commission.
5. The party who refers the dispute to the Commission must satisfy it that a copy of the referral has been served on the other party to the dispute.
6. The Commission must appoint a commissioner to attempt to resolve the dispute through conciliation.
7. If the dispute remains unresolved, either party to the dispute may request that the dispute be resolved through arbitration.
8. If the unresolved dispute is about whether or not the registered trade union is a representative trade union, the commissioner-
   1. a) must seek
      1. (i) minimizeise the proliferation of trade union representation in a single workplace and, where possible, to encourage a system of a representative trade union in a workplace; and
      2. (iminimizenimise the financial and administrative burden of requiring an employer to organizationaltional rights to more than one registered trade union;
   2. b) must consider-
      1. (i) the nature of the workplace;
      2. (ii) the nature of torganizational organizational rights that the registered trade union seeks to exercise;
      3. (iii) the nature of the sector in which the workplace is situated; and
      4. (iv) the organizational history at the workplace or any other workplace of the employer; and
   3. c) may withdraw any of the organizational rights conferred by this Part and which are exercised by any other registered trade union in respect of that workplace, if that other trade union has ceased to be a representative trade union.
9. In order to determine the membership or support of the registered trade union, the commissioner may-
   1. (a) make any necessary inquiries;
   2. (b) where appropriate, conduct a ballot of the relevant employees; and
   3. (c) take into account any other relevant information.
10. The employer must cooperate with the commissioner when the commissioner acts in terms of subsection (9), and must provide any information to the commissioner and facilities that are reasonably necessary for the purposes of that subsection.

Collective bargaining

Collective bargaining is at the centre of the labour relations system. It is an ongoing process of negotiations between representatives of workers and employers to establish the conditions of employment. Collective bargaining developed with the growth of trade unionism, especially from 1890.[footnoteRef:10] [10: https:/www.britannica.com.]

Sec 23 (5)[footnoteRef:11] of the Constitution states that Every trade union, employer’s organization and employer has the right to engage in collective bargaining. National legislation may be legislated to regulate collective bargaining. [11: Constitution, 1996.]

recognizes the right of trade unions to engage in voluntary collective bargaining. This system of voluntary collective bargaining is created via the instruments provided for in the LRA[footnoteRef:12] [12: Act, 66 of 1995, Mario Jacob’s notes Ph.D. Candidate Law Faculty and Sociology Department University of Cape Town.]

The issue(s) in dispute:

Case Abanqobi Workers Union obo Members/IR Voigts (Pty) Ltd[footnoteRef:13] (the applicant) claimed organisational rights from the respondent, which operated five farms in the KZN Midlands and performed contract work for various agricultural businesses. The union (AWU) recruited only the members working on the Mount Verde farm, but two of its members was transferred to other farms. [13: [2019] 9 BALR 942 (CCMA).]

The union (AWU) claimed that it was entitled to organizational rights in terms of the LRA,[footnoteRef:14]but the respondent was willing to grant only sec 13[footnoteRef:15] which deals with union subscriptions which the union (AWU) rejected. [14: Act, 66 of 1995.] [15: Act, 66 of the LRA.]

It is common cause that ratified conventions of the International Labour Organisation (ILO) are binding in South Africa. When interpreting both the Constitution[footnoteRef:16]of the Republic of South Africa, 1996 and the LRA[footnoteRef:17]… The two key conventions of relevance here, both of which have been ratified by South Africa, are the Convention on Freedom of Association and Protection of the Right to Organise 87 of 1948 and Collective Bargaining Convention 98 of 1949. [16: Constitution of the Republic of South Africa ,1996.] [17: Act, 66 of 1995.]

The union seeks sections 12[footnoteRef:18], 13, and 15 rights, because without having these rights it is difficult to recruit new members and to serve existing members. Sec 12 speaks about access to workplace, sec 13 speaks about the trade union subscriptions and sec 15 speaks about leave for trade union activities. In this case IR Voigts (the respondent) is willing to give the union sec 13 which speaks about deduction only meaning that the union will not have access to the workplace in order to recruit more members and their members will not be able to attend any union activities. [18: Act, 66 of 1995.]

The union must be sufficiently representative in order to access the minimum organisational rights in the LRA.[footnoteRef:19] These rights include trade union access to enter the workplace; hold meetings with employees outside their working hours… [19: Section 12 and 13 LRA. Sufficiently representative, generally is between 20 to 30 percent of the trade union membership at the workplace. ‘Mario Jacobs’ notes…]

In South African Industrial, Commercial and Allied Workers Union / Denny Mushrooms a Division of Libstar Operations (Pty) Ltd[footnoteRef:20] [20: [2018] 5 BLLR 543 (CCMA).]

The CCMA had to consider whether the South African Industrial Commercial and Allied Workers Union (SAICWU) should be granted organisational rights in terms of sec 12-15 of the LRA. The employer, Denny Mushrooms, refused to recognise SAICWU claiming that the union’s constitution does not include the agriculture sector and therefore could not be granted organisational rights.

Lufil Packaging (Isithebe), A division of Bidvest Paperplus (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others[footnoteRef:21] [21: (2018) 39 ILJ 1786 (LC).]

In this case, also involving NUMSA as one of the parties, the CCMA was called to determine whether NUMSA could organise employees falling outside its registered scope. CCMA commissioner after hearing the arguments from both parties, ruled in NUMSA’s favour and granted the union organisational rights. Not happy with the outcomes or ruling, Lufil approached Labour Court (LC) seeking to review the commissioner’s ruling.

In his judgment Gush J sets out the essence of the review application he is required to determine as:

The applicant contended that the provisions of the third respondent’s constitution that sets out the third respondent’s scope of, and the industries in which it is entitled to organise, do not entitle the third respondent to those organisational rights contained in chapter 4 of the LRA. The applicant avers that the operations of the applicant do not fall within an industry in which the third respondent may organise or fall within the third respondent’s scope.

In addition, the applicant avers that the employees’ right to join the third respondent is limited by its constitution. Section 4 by the [sic] of the LRA records the employees’ right to freedom of association and includes the right to join a trade union “subject to its constitution”.[footnoteRef:22] [22: Para 9 and 10 of the judgment.]

Para 28, as far as locus standi is concerned, the conditions precedent to a union wishing to exercise organisational rights, in accordance with the LRA[footnoteRef:23], need to only satisfy two conditions: [23: Act, 66 of 1995 (“the Act”)]

• a) The u must be registered (see sec 11 14 16 18 and 21).

It is common cause that the third respondent is a registered union;

• b) The union must be sufficiently representative (sections 11, 12, 13, 15, 16, 18 and 21) …

In Police & Prisons Civil Rights Union v SA Correctional Services Workers Union & Others (POPCRU (CC))[footnoteRef:24] [24: (2018) 39 ILJ 2646 (CC) POPCRU (CC)).]

The case of POPCRU Constitutional Court (CC) began with a minority union, the South African Correctional Services Workers Union (SACOSWU) and the Department of Correctional Services concluding a collective agreement (the organisational rights agreement) that granted SACOSWU organisational rights to access the workplace for the purpose of representing its members in grievance and disciplinary proceedings and to the deduction of union subscriptions.

This was in spite of a collective agreement regulating thresholds for organisational rights concluded under s 18[footnoteRef:25] between POPCRU and the department. The threshold agreement had been extended to cover non-parties under s 23 (1) (d) of the LRA. POPCRU referred a dispute to the General Public Service Sectoral Bargaining Council, objecting to the organisational rights agreement. It alleged that the agreement was invalid as SACOSWU had not met (and did not meet) the representativeness threshold stipulated by the threshold agreement. However, the arbitrator found in favour of SACOSWU, drawing heavily on the Constitutional Court’s judgment in Bader Bop for support… [25: Act, 66 of 1995]

Second case:

The issue in dispute is:

Whether or not the union is entitled to elect shop stewards at Tolcon’s Mooi Toll Plaza.

In South African Transport and Allied Workers Union obo Members / Tolcon (Pty) Ltd[footnoteRef:26] [26: [2019] 8 BALR 897 (CCMA)]

The union is claiming the right to elect shop stewards at one of four divisions of the employer where it lacked majority to be able to elect shop steward. The respondent administers several road stations on N3. The applicant (SATAWU) concluded the agreement with the respondent in 2012 in respect of three of the stations in terms of which it was require to maintain a membership of 50% + 1 of the employees employed for the entire service contract.

In 2015 the respondent suspended the recognition agreement with the union and gave the union the notice that the agreement would be cancelled if the union did not restore its majority within 30 days, and refused the union’s request to elect the shop stewards at one of the stations.

In case Professional Transport and Allied Workers Union obo members / Professional Aviation Services.[footnoteRef:27] [27: [2016] 4 BALR 421 (CCMA)]

The Commissioner considered section 21 (8)[footnoteRef:28] of the LRA sets out factors which a Commissioner must take into account when resolving a dispute about whether or not a trade union is a representative trade union and held that a key consideration in such matters is the principle of majoritarianism. The commissioner also pointed out that in order to decide whether the applicant was entitled to organisational rights, he had to consider the meaning of “workplace”. [28: Act, 66 of 1995 ]

Section 213[footnoteRef:29] of the LRA states that ‘workplace’ means “the place or places where the employees of an employer work. If an employer carries on or conducts two or more operations that are independent of one another by reason of their size, function or organisation, the place or places where employees work in connection with each independent operation, constitutes the workplace for that operation.” [29: See footnote 28 above.]

Constitutional Law:

Section 23[footnoteRef:30] of the Constitution regulates the right to fair labour practices, including the right of all trade unions to organise workers and to engage in collective bargaining. [30: Constitution, 1996.]

In South African Transport and Allied Workers Union obo Members / Tolcon (Pty) Ltd

The union is looking for the rights in sec 14 of the LRA. Sec 14 (2) states in any workplace in which at least ten members of a representative trade union are employed, those members are entitled to elect from among themselves.

Conclusion

Having read both cases, I found out that both unions are looking for rights even if they are different, because the first one is looking for organisational rights, while the second one is looking for the right to elect the shop steward. They both suffer from the same thing because they lack Sufficient Representative (SR) in order to access those rights. With the above in mind, in these cases I learnt how the Commission, Mediation and Arbitration (CCMA) and the labour courts consider disputes where the trade unions sought to obtain trade union rights outside their scope and how they deal with minority unions.

Bibliography

Statute

1. South Africa. (2015). Labour Relations Act No. 66 of 1995. Pretoria: Government Printer.
2. The Constitution of the Republic of South Africa, 1996, 14th Edition.

Case Law

1. Abanqobi Workers Union obo Members/IR Voigts (Pty) Ltd [2019] 9 BALR 942 (CCMA).
2. Lufil Packaging (Isithebe), A division of Bidvest Paperplus (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2018) 39 ILJ 1786 (LC).
3. Police & Prisons Civil Rights Union v SA Correctional Services Workers Union & Others (POPCRU (CC)) (2018) 39 ILJ 2646 (CC) POPCRU (CC)).
4. South African Transport and Allied Workers Union obo Members / Tolcon (Pty) Ltd [2019] 8 BALR 897 (CCMA).
5. Professional Transport and Allied Workers Union obo members / Professional Aviation Services [2016] 4 BALR 421 (CCMA).
6. South African Industrial, Commercial and Allied Workers Union / Denny Mushrooms a Division of Libstar Operations (Pty) Ltd

Other Source/s [2018] 5 BLLR 543 (CCMA).

Other Source/s

1. cliffdekkerhofmeyr.com.

Collective Bargaining in the USA and India: Analytical Essay

Research Title: Importance of Collective Bargaining

Research methodology

The researcher has used Harvard Bluebook Law 20th edition, method of citation. In this paper, the researcher aims to understand the theory and practice of collective bargaining principle, with focus on its practices and evolution in the USA and India, specifically. This paper will delve into the process of collective bargaining, its evolution, importance etc. The researcher will also do a comparative study on the difference, if any, in the practices of collective bargaining in India and the USA.

Research Problem

Collective bargaining is not easily accomplished and is often influenced by a lot of factors one being political decentralization. One of the main issues with the principle of collective bargaining is in choosing whether to pursue centralised or decentralised bargaining[footnoteRef:1]. [1: Villarejo, E., 2020. Progress And Problems In Collective Bargaining. [online] Eurofound. Available at: [Accessed 3 April 2020].]

Decentralization can be defined as “the process by which activities of an organization, particularly those regarding planning and decision making, are distributed or delegated away from a central, authoritative location or group”[footnoteRef:2].usually trade unions favour centralised collective bargaining as it tends to strengthen the position of the workers. [2: En.wikipedia.org. 2020. Decentralization. [online] Available at: [Accessed 3 April 2020].]

The concept varies from country to country, with each country dealing with their own labour problems. Collective bargaining is merely a gateway to achieving some relief regarding those problems. However, even though it is believed that there is power in numbers, it is easier said than done when the workers’ job is in jeopardy. Hence, this paper will focus on the concept of collective bargaining in specific countries – India and USA, analyse their issues and how the laborers are fighting these issues through the method of collective bargaining.

1. The Evolution of collective bargaining in the USA and India.
2. The importance and scope of collective bargaining.

Research Hypothesis

Collective bargaining can be defined as the “ongoing process of negotiation between representatives of workers and employers to establish the conditions of employment.”[footnoteRef:3]The agreement decided upon in this process may not only be related to wages but other aspects as well such as hiring practices, layoffs, promotions, job functions, working conditions and hours, worker discipline and termination as well as benefit programs[footnoteRef:4]. [3: Augustyn, A., 2020. Collective Bargaining | Definition, Objectives, Functions, Types, & Facts. [online] Encyclopaedia Britannica. Available at: [Accessed 3 April 2020].] [4: Augustyn, A., 2020. Collective Bargaining | Definition, Objectives, Functions, Types, & Facts. [online] Encyclopaedia Britannica. Available at: [Accessed 3 April 2020].]

The practice of collective bargaining has existed in Britain since the 18th century when it was first used by Beatrice Webb who was a founder of the field of industrial relations in Britain. This practice was widely accepted and implemented in the United States of America for settling any industrial disputes. As this further developed in the USA, USA is considered to be the motherland of collective bargaining and this has also spread to India as a method of settling industrial disputes.

In the U.S., collective bargaining takes place between the labour union leaders and the management of the company where the union workers are employed. This sort of agreement produces a “collective bargaining agreement” which establishes the rules of employment for a set number of years. And this is obtained through a certain cost which union workers bear, in the form of “union dues.”[footnoteRef:5] [5: Kenton, W., 2020. What Is Collective Bargaining? [online] Investopedia. Available at: [Accessed 3 April 2020].]

Collective bargaining is a group process involving two parties – the employers and the employees. In this process, negotiations form an important aspect of the process where important terms and conditions are discussed during these negotiations and focuses on resolving any issue of the labour. It is a bipartite process which means that there are only two parties involved in this process.

One of the most important aspects of collective bargaining is that it’s a never-ending process. It continues well after an agreement has been made and is implemented. Moreover, this process does not allow the use of any sort of compulsion to influence the other party into agreeing to any particular terms and conditions. The right to bargain collectively is also recognized through international human rights conventions. It is stated under article 23 of the Universal Declaration of Human Rights, which recognizes the ability to join trade unions as a human right. It is also recognized under item 2(a) of the International Labour Organisation’s declaration[footnoteRef:6]. [6: Lawteacher.net. 2020. Trade Unions And Collective Bargaining. [online] Available at: [Accessed 3 April 2020].]

One of the main reasons for collective bargaining is to fight for better working conditions, mainly increased wages. But does collective bargaining actually result in higher wages and better working conditions? Are labour organizations actually able to increase the wages of all their workers at an equal rate? When considering the economic aspect of this, we can assume that the distribution of labour and capital in a single industry moves in accordance with the elasticity of substitution between labour and capital. This means that, while both labour and capital are utilised in an industry, they also serve as substitutes. Unfortunately, in the case of industries, capital employment is favored over labour employment. Hence, collectively bargaining for higher pay and other benefits may not always result in a positive outcome in such industries.

In such a case, the employer would be more than willing to substitute the labour with capital. As such, it can be observed from this scenario that collective bargaining is not always the solution and does not always work. Especially in industries dominated by machinery, here labour are considered expendable. Collective bargaining would bear no fruit here and the result can never be predicted. This paper will analyse the effectiveness of collective bargaining and refer to cases wherein it has been both a success and a failure.

Collusion in Poultry Market and Collective Bargaining Agreement: Analytical Essay on Microeconomics

Q1 “Egyptian Competition Authority (ECA) has announced evidence of collusion in poultry market.” What is collusion? How does it affect supply, demand, production, and prices (show its impact)? What is ECA? What is the case of poultry market in Egypt (give a brief)?

The Egyptian Competition Authority (ECA) has been established in 2005. Its objective is the protection of competition and the prevention of monopolistic practices to ensure free entry and exit from the market and provides the competitors with equal rights and opportunities to compete in all economic sectors, which guarantees a fair competition to all competitors.

Collusion is a term used to show an illegal agreement between people or companies that are usually competitors in a market as they work together to influence a market or pricing for their own advantage. Also, it refers to collective attempts to reduce competition.

Acts of collusion include price-fixing, synchronized advertising, price rigging and sharing insider information. These acts lead to significantly increased prices, which leads to a decline in consumer surplus, and decrease the demand, in addition to allocative inefficiency. Also, it leads to reductions of output and supply. Collusion acts as a barrier to entry that may discourage new firms from entering the market as they aim to exclude new firms to prevent the market becoming more competitive. It make firms lazy and avoid innovation, efforts to increase productivity and efficiency because of the easy profits they gain from collusion.

As we can see in the graph, that collusion restricts quantity produced to Q2, which increase prices to P2 (in the first graph). And producers capture more from consumers surplus (Shaded part in the second graph) which means that consumers surplus decreases.

In Egypt, collusion actions led to the closure of many farms, where 40% of small breeders preferred to exit from the industry. Feed prices have risen from 5000 to 7000 pounds per ton. And cost of feeding birds represents about 70% of the cost of the production process.

The increase in the prices of broiler chicks led to the emergence of many poultry owners and the lack of their capacity to meet this insane price of chicks, and therefore decreased quantities of meatballs, which led to higher prices of chicken to retailers.

Q2- Labor economics is a branch of microeconomics that tries to give better explanation of labor market and deciding wages. What is the role of labor union in affecting the market? What is collective bargaining agreement? How collective bargaining agreement can affect the labor market? Give examples of collective bargaining agreement in Egypt lately.

A labor union is an organization that works with employers to resolve labor issues such as improving workers compensations, benefits, and working conditions, such as regulating labor wages where they use “price flooring” which is a minimum wage set by a regulator or by law that prevents employers to charge wages lower than the floor. Labor union and employees unite to make decisions and represent collective interests of workers that are classified upon their mutual agreements called (Collective bargaining agreement) to resolve any burdens or conditions that affects their work. Labor unions also strive to bring greater fairness and due process to the workplace; as one of their main roles is to resolve disputes in the workplace, they act as an intermediary between employers and business owners. Moreover, labor union leaders are advocates for workers’ rights and benefits through collective bargaining as they are experienced at solving problems through formal arbitration and grievance procedures.

Collective bargaining agreement is a set of negotiations that takes place between employers and a group of employees aimed at agreements to improve and regulate multiple aspects in their work such as determining employees working salaries in addition to regulating working conditions that may affect the cost of labor as it includes number of holidays, and overtime and night shift pay. Another aspect it regulates are employees benefits such as: (vacation days, health insurance, life insurance, dental insurance, etc… ) as well as granting workers compensation and fulfilling their rights. However, some collective contracts also specify which workers can do which jobs through further constraining reallocation of labor within a firm.

The people that are responsible and are mostly involved in negotiating a collective bargaining agreement are HR leaders, lawyers, and their direct reports by delegating these tasks to them; the company must give them the authority to negotiate the terms of the union contract on the company’s behalf. Some of the positive effects of collective bargaining agreement include freeing yourself from the often laborious tasks of compiling wages rates, researching benefits trends, and calculating labor costs and is a huge time saver in negotiating wages, benefits, hours, and working conditions for individual employees, management will be able to negotiate compensation packages for 100 employees in one union contract which will save money as well. Moreover, collective bargaining agreements help to resolve issues and conflicts raised from the workplace as these agreements include clauses on how to resolve potential conflicts between employees and supervisors in a so called grievance process. These contracts provide the process, conditions, and the steps required to either resolve or escalate issues. Workers’ quality of live is also improved due to increased level of pay for workers and improved safety and working conditions. In addition provides an extra level of security for employees and employers in the labor market because both parties are bound to the collective bargaining agreement, if one side or the other is not performing to the stipulations that have been set forth in the contract, then they can be held responsible to them by the injured party.

The Minister of Manpower and Migration (MOMM) supervises and observes collective discussions and agreements. Wages, benefits, and job classifications are set by the government for the public sector. On the other hand, the private sector where Egyptian Trade Union Federation ( ETUF) has weak representation, from which laborers disrespect government rules and requirements on the minimum wage, social security, and other matters as they are not interested in collective bargaining. Some of the examples of Collective Bargaining Agreement in Egypt lately include that:

• Employers should notice and respect the right of employees to freedom of association and collective bargaining.
• Employers should apply to all national laws, regulat,ions and procedures concerning freedom of association and collective bargaining.
• Workers, without distinction whatsoever, shall have the right to establish and to join organizations of their own choosing subject only to the rules of the organization concerned, without previous authorization. The right to freedom of association begins at the time that workers seek employment and continues through the course of employment, including eventual termination of employment, and is applicable as well to unemployed and retired workers.
• Q4) Food subsidy is one of the ancient tools the government uses to affect the market of food. What is food subsidy? Explain using consumer and producer theory its impact? How food subsidies affect prices and production? Give summary of food subsidy situation in Egypt.

Food subsidy is a financial aid paid by the government to the suppliers in order to reduce their costs of production and encourages them to increase output, also the subsidies are financed from general taxation or by borrowing as well as subsidies cause the supply curve to shift to the right and the amount spent on the subsidy is equal to the subsidy per unit multiplied by total output. Subsidies is used to increase the production and decrease the price.

The theory is the consumer and producer surplus, where the consumer surplus: the difference between the highest price consumers are willing to pay and the actual market price of goods, it is found by the area below the demand curve and above equilibrium. While for the producer surplus: it is the difference between the market price and the lowest price a producer would be willing to accept, it is found by the area above the supply curve and below the market price. And both consumer surplus and producer surplus together create an economic surplus.

The price effect of a subsidy is to shift the supply curve downward by the amount of the subsidy. Effectively this is an increase in supply. The impact of the subsidy is to lower prices for consumers but to increase the price received by producers. While for the Marginal subsidies on production will shift the supply curve to the right until the vertical distance between the two supply curves is equal to the per-unit subsidy; when other things remain equal, this will decrease price paid by the consumers (which is equal to the new market price) and increase the price received by the producers.

Statistics are sounding a warning bell about the state of Egypt’s food security, poverty, and malnutrition. The number of food-insecure Egyptians has increased about 21 percent from 2009 to 2011, according to a 2011 analysis of household incomes, expenditures, and consumption. Results for poverty and malnutrition were even more dramatic, with poverty increasing around 25 percent from 2005 to 2011, and, in 2011, almost one-third of children ages 6 months to 5 years suffered from stunting, a direct effect of undernutrition. Anemia rates were at 50 percent for the same age group. A recently released policy note, Tackling Egypt’s Rising Food Insecurity in Times of Transition, produced jointly by IFPRI, the United Nations World Food Programme (WFP), and Egypt’s statistical agency, CAPMAS, delves into the complexity of food subsidies and nutrition in Egypt and offers some policy recommendations for reform. According to the note, the Egyptian government’s food subsidy program is designed to protect the most vulnerable from shocks such as rising food prices, but only 30 percent of Egyptians really need this protection while more than 70 percent receives it. And while the food subsidies did succeed in preventing an even more dramatic spike in poverty during the recent succession of crises, the program is very expensive and not well-targeted to those who need it most. And subsidies may indirectly contribute to malnutrition, as they keep the prices of rationed, calorie-dense foods far below market prices, increasing the relative costs of non-subsidized, often more nutritious, foods.

References

1. https://www.economicshelp.org/blog/21475/economics/collusion-meaning-and-examples/
2. https://en.engormix.com/poultry-industry/articles/poultry-industry-egypt-rise-t40853.htm
3. https://www.concurrences.com/en/authors/info-egyptian-competition-authority
4. https://bizfluent.com/info-7958760-benefits-collective-bargaining-contract.html
5. https://legal-dictionary.thefreedictionary.com/collective+bargaining
6. https://www.bartleby.com/essay/The-Role-of-Labor-Unions-PK6PYWFBYRPS
7. https://www.fairlabor.org/sites/default/files/documents/reports/may-2016-independent-trade-unions-in-egypt_0.pdf

Effective Collective Bargaining and Conflict Management: Analytical Essay

Introduction 1.1 Problem statement

The relationship between management and trade unions are one of the most fundamental working relationships within South Africa’s labour sphere. Yet, bargaining with South African trade unions can be quite a daunting task, as management continually protests against trade unions’ obstinate actions and workplace disruptions within their organisation (Mash & Kremer, 2016).

Researchers within the field of sociology critically portray trade unions as uncompromisable, supercilious and irrational (Farber 2001; Freeman and Medoff, 1984). Even so, trade unions are commonly acknowledged as employee organisations formed with the expectation of resolving work-related matters and promoting employee benefits (Rajesh & Manoj, 2015). Mash and Kremer (2016) however, point out that trade unions put emphasis on vertical differences that occur in the organisation consisting between management and employees. Dhammika (2015) describes trade unions as a key determining factor regarding the nature of industrial relations, not only within the labour market sphere but as well as in the country. Nevertheless, unionism is cynically connected with organisational research, capital investment and market value of organisations (Cullinane & Durdan, 2012; Mash & Kremer, 2016). Cullinane and Durdan (2012) state that the relationship climate between management and trade union is set by the rejection or acceptance of management towards trade unions. This determines whether the labour relationship between unions and management are harmonious or not (Cullinane and Durdan, 2012). Furthermore, the degree to which an employee commits either to the union or their organisation is a deciding factor in the relationship between management and union (Snape, Tom, & Chan, 2000). This view can result in unanticipated conflict causing a strenuous bargaining relationship between management and union (Ohlendorf, 2001; Omisore & Abiodun; 2016).

On the word of Godfrey (2010) collective bargaining in South Africa is an adversarial and conflicting process, which involves negotiations between parties with contradictory interests, searching for mutually acceptable compromises. In accordance to this, the South African constitution grants all individuals the right to fair and just labour practice as well the right to strike (Botha, 2015). However, the right to strike and the right to engage in the collective bargaining process is governed by the LRA 66 of 1995 (Botha, 2015). The collective bargaining process is thus voluntary and therefore settles any conflicting objectives of management, employees and unions through joint regulations of the terms and conditions of employment (Harrison, 2004). Du Plessis et al. (1996) describe collective bargaining as a process in which mutual control of the organisation is established by management and labour and by bargaining collectively, all workplace-related conflict is contained and collective agreements are reached to resolve any conflict situations. Nel and van Rooyen (1991:166) further elaborate that during the bargaining process management and unions meet, present and counter demands, convince, and in many cases within the South African labour sphere, threaten the opposition, until suitable agreements are reached.

Kahn-Freund (1972) states that for management, collective bargaining serves as a way to maintain peaceful industrial relations and for trade unions, it serves as a way to maintain specific work standards, such as employment rewards and stable employment conditions for union members. The collective bargaining process is set in motion when the trade union stipulates their demands, the management will act in response by comparing the demands stipulated by the union with their own (Harrison, 2004). According to Clegg, Courpasson and Phillips (2006) and Dubin (1957), the bargaining relationship between management and the representative trade union is typically viewed as an ongoing power struggle. Hence, the degree to which a trade union is viewed as a nuisance or an advantage in the bargaining relationship is greatly determined by the management’s response toward the trade union (Mash & Kremer, 2016). In addition, when trade unions affiliate themselves with political parties (Nanayakkara, 1998), this causes severe economic and managerial implications for the organization (Fenando, 1988). As most South African trade unions are affiliated with political parties, this has fostered political unionism (Biyanwila, 2003). Lambert (2002) defines political unionism as trade unions who engage with predominant political parties with the aim of obtaining power-based mechanisms to achieve union demands. Political unionism is largely used by trade unions as a power and status bargaining tool and provides unions with a clear collective identity (Dhammika, 2015; Gunawardana & Biyanwilla, 2008). T

By standing together unions gain power and reduce the gap between management and employees (Mash & Kremer, 2016). Thus, as the unionization of employees grow, changes occur from bargaining over work conditions and wages to a well-organized effort led by professional individuals in the trade union (Mash & Kremer, 2016). According to Martinez, Fiorito and Ferris (2012), one of the most distinct objectives of any trade union is to better the balance ratio of power between trade union and management groups. Therefore, the trade union’s level of strength is a realization of this fundamental aim (Martinez, Fiorito and Ferris, 2012). As a result, strong unions are measured in accordance to their perceived success in dealing with management and vice versa (Martinez, Fiorito and Ferris, 2012). Bacharach and Lawler (1986) distinguished that the power dependence theory treats the ongoing collective bargaining relationship between management and unions as a power struggle where both union and management try to obtain a favorable power position.

Effective collective bargaining and conflict management play a crucial role towards harmonious labour relationships between unions and management (Yah Baah et al., 2012). According to Gelfand and Dyer (2000) conflict is ever-present, in addition, the capacity to comprehend, predict and manage conflict is one of the most essential challenges in any labour relationship. Elgoibar et al. (2012) elaborate that the success of internal collective bargaining and problem solving mainly depends on trade unions and management’s capability of managing potential conflicts. Rahim (1986) states that efficient and effective conflict management promotes motivation, improves management and union morale and encourages individual and social growth. Yah Baah et al., (2012) coincide with Rahim (1986) by further explaining that successful conflict management can contribute to a organisation’s effectiveness, resulting in ‘win-win’ situations, but if conflict is mismanaged it can result in counterproductive behaviour, resulting in both parties walking away empty-handed. As stated by Ting-Toomey et al. (2000) conflict is not always the main cause of problematic collective bargaining sessions but rather the conflict management style implemented, creating insubstantial conflict conditions between management and unions. Blake and Mouton (1964), Thomas and Kilmann (1974) and Rahim (1983) identified specific styles to manage conflict which enable individuals to react in a particular manner when confronted with a conflict situation. The five styles of conflict have been identified as; competing (forcing, dominating), accommodating (obliging), avoiding (denial, withdrawal), collaborating (integrating) and compromising (negotiating) (Blake & Mouton 1964; Rahim 1983; Thomas & Kilmann 1974). According to Vokić and Sontor (2009) no particular style of managing conflict is always the most suitable, therefore it depends on the given situation in order to reach a decision about what style will be the most appropriate to implement. By way of explanation, background appears to play a fundamental part in managing conflict, which indicates the choice an individual makes regarding their conflict management style is situational dependant (King & Miles, 1990).

In conclusion, the general objective of this study will be to investigate how trade unions and management approach each conflict management styles and how these styles to manage conflict affects each parties bargaining power during the collective bargaining process. It is anticipated that a better understanding of these issues will pinpoint better strategies for collective bargaining between management and unions. Furthermore, this research study will attempt to investigate the influence of the power-dependence theory on the collective braining process of management and unions, and in addition how the power-dependency of each actor influences the participating member’s conflict management styles. Henceforth, the researchers will conduct a quantitative study to gather data relating to the impact of power-dependence and conflict management styles on management and trade unions and how these factors overall influences the collective bargaining process of management and unions.

1.2 Literature review

Collective bargaining intro

Intro

In South Africa, collective bargaining acts as a fundamental economic function that regulates employee relations in the workplace and aims to the resolve conflicting interests of management and trade unions (Harrison, 2004). When studying present literature available on collective bargaining, research verified that differences in the collective bargaining processes amongst unions and management are derived from the power dependence theory (Doellgast & Benassi, 2014). Theorists argued that the outcome and structure of these labour market relationships are explained by differences or variations in the power of labour relative to management and the mediation through unions and the state (Korpi 1983; Esping-Andersen and Korpi 1984). When assessing the variation in trade unions access to bargaining power, which includes their level of power and strength in the organisation and their participation rights in the workplace, it influences the unions capability to promote employees’ interest in reorganisation and control over their work environment (Doellgast & Benassi, 2014).

Empirical evidence, therefore, suggests that coordinated forms of collective bargaining are not mainly established and maintained to seek and resolve coordination problems between management and unions, but are instead the result of conflict between societal attempts made by management and unions to regulate the labour market through bargaining collectively (Streeck 2009). Research, therefore, suggests that management and unions are not necessarily complicit with marginal growth in the collective bargaining relationship and will therefore seek to expand their power when their traditional sources of bargaining power declines (Doellgast & Benassi, 2014).

Power dependence

According to Harrison, (2004) the basis of collective bargaining is power. Therefore, in order to understand the theory of power Heckathorn (1983) and Lawler and Bacharach (1986) defined the theory as one actor’s dependence on the opposing on another. Thus, the fundamental aspect of the theory is based on the proposition that each actor’s power is based on the dependency of the opposing side rather than their own side (Bacharach & Lawler, 1981a; Blau, 1964; Emerson, 1962, 1972). Consequently, within the field of labour-management relations, the labour’s power is based on the dependency of management on the participation of the trade union and its members (Bacharach and Lawler,1986). Whilst management’s power is based on the degree to which the participating union and its members depend on the management (Lawler & Bacharach, 1986a).

Previous research conducted in the 1970s and 1980s based on the examination of the power dependence theory concluded that the source of power is based on an estimation about oneself and further extent of power (Bacharach and Lawler, 1976, 1981; Hegtvedt, 1988; Lawler & Bacharach 1976, 1979). Dubin (1957) who conducted vital studies based on the power dependence theory in the 1950s, pointed out that bargaining power is a worn-out term used in the research of union-management relations. Whilst, the power dependence theory is viewed by researchers as a systematic process that involves opposition between competing parties over who executes what function, when and how (Bacharach & Lawler,1981; Dubin, 1957; Lawler & Bacharach, 1976, 1979).

Bacharach and Lawler (1986) discovered that the power dependence theory contains certain paradoxes that define the attainment and use of power within the collective bargaining relationship. The four paradoxes of power dependence are as follows;

Power is based on giving. The first paradox according to Bacharach and Lawler (1986), in order for management or unions gain power they must make the other depend on them. Thus, this is accomplished by one party providing benefits to the other (Bacharach and Lawler, 1986; Lawler & Bacharach, 1986). For example, providing the opposition with an item of interest that could influence the power balance in the first parties’ favor. However, both parties, wants to utilize the benefits they provided in order to gain additional benefits in return (Lawler & Bacharach, 1986b). Yet, each actor want to provide benefits which they themselves view as invaluable, that the opposition views as highly valuable, and in return receive the outcome benefits they desired (Lawler & Bacharach, 1986a).

To use power is to lose it. Lawler and Bacharach (1986b), established that the second paradox of the power dependence theory consists out of coercion, which entails that a raise benefits taken or a reduction in benefits provided to the other party. Thus, each party has the capacity to extract benefits. Literature based on power dependence, suggests that the provision of benefits entail a major threat of losing said benefits (French & Raven, 1959; Bacharach and Lawler, 1986; Lawler & Bacharach, 1986). Nevertheless, if the giving is the basis of the power dependence theory, this could implicate the degree to which one party coerces another within the long run (Bacharach and Lawler, 1986; Lawler & Bacharach, 1986). As a result, when a trade union succeeds in negotiating favorable benefits it may motivate management to reduce labour costs such as retrenchments or mechanizations of the work place, resulting in management seeking commodities elsewhere (Lawler & Bacharach, 1986).

Power may have integrative rather than disintegrative effects on a labour-management relationship. The third paradox of power dependence is based on the effort of management and trade unions to change the power relationship, which in most cases is met with hostility (Lawler & Bacharach, 1986). As a result, management and unions implement tactics designed to change the power relationship, which are equivalent in an attempt to transform the terms of which the existing relationship rests on (Bacharach & Lawler, 1986; Lawler & Bacharach, 1986). Hence, this actions causes a disintegrative effect on union-management relations (Bacharach & Lawler, 1976; Lawler & Bacharach, 1986). According to the power dependence framework, strategic actions based on competitive bargaining styles, will ultimately have a integrative effect on the collective bargaining process (Bacharach & Lawler, 1976, 1986; Lawler & Bacharach, 1986). Based on the power dependence framework, two types of tactical options exist in which enables management and unions to modify the power balance in their relationship (Lawler & Bacharach, 1986). The two broad types of tactical options to amend the power relationship are namely; tactics that amplifies the opponent’s dependence and tactics to reduce the actors dependence (Bacharach and Lawler, 1986).

Inferior power can provide an actor a tactical advantage. The last paradox only applies to the commitment dimension (Bacharach & Lawler, 1986). This paradox has opposing implications for power and tactical actions. In accordance with the power dependence theory, actors who are vastly committed to the important benefits will have less proficient power than a actor who is less committed (Bacharach & Lawler, 1976, 1981. 1986; Lawler & Bacharach, 1986). Furthermore, the paradox entails that high levels of commitment will lead to increased tactical attempts to manipulate the opposition, in so doing obtaining highly valued benefits (Bacharach & Lawler, 1981; Lawter & Bacharach, 1976, 1986). Therefore, the party with high power in the aforementioned terms may yield more to the opposition than predicted by their power position in the labour relationship (Lawler & Bacharach, 1986b).

(Link to CM)

Notably, the significance of the power dependence theory as variable to conflict management has been recognized and acknowledged by numerous researchers. Greenhalgh (1987) first noted that it is realistically reasonable to anticipate that the power experienced from whatever source will fully affect management or trade unions choice of conflict management style tactic. Greenhalgh (1987) further elaborated that any outcomes of conflict is situational bound and therefore depends on, amongst other indicators, factors such as power distribution and dependency between conflicting parties. Putnam and Poole (1987) on the other hand-reviewed empirical findings and thus found that preferences in regards to conflict management’s styles, differ across hierarchical levels, with superior management utilizing styles such as forcing or dominating and subordinate level management utilizing styles such as avoidance, collaboration and compilation when engaging in negotiations. Significantly, variation in conflict management styles may well reflect the power and status in the discrepancies in bargaining collectively (Ritov, 1997). According to a study conducted by Tjosvold and Okum (1979), within an experimental research setting, participant with low power will thus act more cooperatively and are hence more likely to use the obliging conflict management style than participants who have high levels of power. Similarly, Bacharach and Lawler (1981) argues that the conflict styles union and management therefore use are strongly linked to the level of power they have during negotiations.

CMS

According to Putnam and Wilson (1983) and Roche and Teague (2012), each individual’s conflict management style is influenced by the assessment of the bargaining conditions and any potential long-term implications that may occur. Hence, on the word of Ritov (1997), the choice of conflict management style unions and management choose to implement is presumably influenced by unions and managements power position in the in the collective bargaining relationship. In agreement with Ritov (1997), Bacharach and Lawler (1981) specified in their study that the aforesaid consideration is primarily meaningful when the one actor’s power is obtained in terms of the other actor’s dependence on them for future rewards or benefits. Blake and Mouton (1964), Rahim (1983) and Thomas and Kilmann (1974) identified five styles to effectively manage conflict. These five styles are as follows; competing (forcing, dominating), accommodating (obliging), avoiding (denial, withdrawal), collaborating (integrating) and compromising (negotiating).

The term competing (forcing, dominating) refers to a hard-line, aggressive and hard-nosed approach applied to conflict that is driven by power (Al-Hamdan, Shukri & Anthony, 2010). The competing conflict management style is described by Thomas, Thomas and Schaubhut, (2008) as low cooperativeness and high assertiveness in an attempt to satisfy an individual’s own concern at the other individual’s expense. The individual, therefore pursues their own personal goals without the consideration for others (Al-Hamdan et al., 2010). According McElhaney (1996) and Vivar (2006) the competing approach is suitable to use when a rash decision must be made or to protect an individual or a group from an aggressor or in and a state of emergency.

Accommodation (obliging) is characterised by high cooperativeness and low assertiveness (Al-Hamdan et al., 2010). By obliging or accommodating an individual sacrifices their own concern or opinion to satisfy another individual or group (Al-Hamdan et al., 2010; Thomas et al., 2008). Accommodation involves concessions, unrestricted agreements and offers of help (Al-Hamdan et al., 2010). According to Marriner (1982) and McElhaney (1996) the accommodation conflict management style encourages harmony and gains acknowledgment and credit that can be used in the future. Ibrahim and Kassim (2014) noted that in the accommodating style, managers might be more inclined to self-sacrificing, being generous or charitable, and therefore conforming to another individuals desires and would rather yield towards other individual’s point of view.

Avoiding (denial, withdrawal) on the other hand, neglects both conflicting parties concerns by postponing the conflicting issue (Thomas et al., 2008). The avoiding style is the outcome from low cooperativeness, low assertiveness and low concern for self and others (Keenan et al.,1998; Thomas et al., 2008). Keenan et al. (1998) elaborates that the avoiding style entails reducing the importance of a problem and trying to suppress any thoughts regarding the conflicting problem. The avoiding conflict management style refuses to address the conflicting problem and this approach style would be appropriate if the opposing party is more powerful (McElhaney, 1996).

Marriner (1982), identifies collaboration (integrating) as both high in cooperativeness and assertiveness. In line with Marriner (1982) research Thomas et al. (2008) concurs that collaboration involves an attempt to work with another party to find an integrative or win-win solution that can satisfy the concerns of both conflicting parties involved. The collaboration approach leads to mutually gratifying decisions-making (Al-Hamdan et al., 2010). According to Al-Hamdan et al. (2010) the collaboration process involves exchanging information about priorities and preferences, indicates insight and composes transitions between significant and insignificant issues, which indicates that each individual or group engages in the problem with equal consideration.

Lastly, compromising (negotiating) is an attempt by conflicting parties to find a middle-ground settlement that will only moderately satisfy each parties concern (Thomas et al., 2008). Al-Hamdan et al. (2010) evaluates the compromising approach as a having a fair concern for both the individual and the conflicting party. The compromising process entails intermediate levels in both cooperativeness and assertiveness (Al-Hamdan et al., 2010; Thomas et al., 2008). Rahim (1983) provides an in-depth analysis of the compromising conflict management style. The compromising style focuses on swift, mutually pleasing decisions that aims to moderately satisfy both parties (Rahim 1983). Al-Hamdan et al. (2010) further elaborates on Rahim’s (1983) statement by indicating that the compromising style emerges when there is negotiation and exchange amid conflicting parties. Furthermore, for every gain the party obtains they have to make a concession during the negotiation process (Al-Hamdan et al., 2010).

In contrast, if the chosen conflict management style is unsuitable to resolve the particular conflict situation this could lead to a variety of unintentional and unwanted consequences (Swanson, 2015). There is a vast amount of literature available on conflict management and conflict management styles. In addition, because of the rising response for harmonious workplace environments and production effective conflict management becoming a vital skill (Chan., Monroe & Tan, 2006), numerous researchers, as a result, conducted studies about the relationship of conflict management styles and various individual and situational factors (Vokić & Sontor, 2009).

In summary, the aforementioned evidence proposes that the perception of the management and union power, in the role of the opposition, is a crucial part of the cognitive situational assessment which directs each party’s choice of conflict management style (Ritov, 1997). Ritov (1997) suggested that the two major distinguishing factors of the opposing party’s power in accordance to empirical evidence are the possible future dependence on the opposing party and lastly the opposition parties control over benefit contingencies. This research study, therefore, hypothesize that in a collective bargaining environment, when trade unions are perceived as powerful, management will be less inclined to implement the dominating conflict management style. Moreover, management will be more prone to implement the avoiding, obliging, compromising, and integrating styles.

3.2 Expected contribution of the study

The proposed study will have the following practical and theoretical contributions to the individual, the organisation, and the literature.

3.2.1 Contribution to the individual

The objective of this research study is for both management and trade union to evolve a relationship of mutual gain and agreement. Thus, the research study will aim to achieve the collaboration of each individual union and management member by inspiring both sides to give up their one-sided agendas and therefore aim to develop a plan that is based on mutually approved professional interests. This will lead to an industrial relationship that will flourish in a climate of cooperation, mutual gain and trust by both management and union.

3.2.2 Contribution to the organisation

In the context of this study, the parties concerned, i.e. management and trade union, will gain a better understanding of their opponent’s conflict management style and level of power in regards to the collective bargaining process. This study could therefore assist both parties to identify what leads to dissatisfying as well as satisfying collective bargaining sessions. More so, data gathered from participants will also offer recommendations as to what the management and trade unions can do or implement to improve collective bargaining to achieve a stronger and sounder relationship between management and unions.

3.2.3 Contribution to Labour Relations literature

This study will be beneficial to the literature as it will contribute to the existing international and national-based research performed on the conflict management styles and power dependence and the collective bargaining process of management and trade unions. Additionally, the data of this study will elicit and arouse the thinking and perceptions held by management and trade unions. This research study may broaden the available knowledge regarding conflict management styles, power dependence and collective bargaining. Also, as to how conflict management styles and power dependence might influence management and trade unions participation in collective bargaining. Finally, this research study can promote further studies on how conflict management styles and power dependence influence management and trade unions participating in collective bargaining sessions.

Collective Bargaining: Analysis of Theoretical Background

To fully address the above question, it is crucial to establish an understanding of the regulatory processes within the employment and labour market. To accomplish this, a systematic comparison of industrial relations between 3 countries can help to realize that understanding, as these countries possess many divergent characteristics which determine their practices and therefore, outcomes. These comparisons can be used as an explanatory device, coupled with the application of theoretical frameworks to develop an understanding of the role and status of trade unions within the system of industrial relations.

As described by Webb S & Webb B (1894), a trade union is a ‘continuous association of wage-earners for the purpose of maintaining and improving the conditions of their working lives which require them to be representative of the interests of its members and achieve progress on their behalf. The intensity of that representation is dependent on a number of contextual factors that affect the employment relationship between trade unions and organizations. The main instrument used by trade unions when communicating with employers is defined as ‘collective bargaining, which is the decision-making process which represents the two parties’ interests with the intent of applying an agreed set of rules to govern the utilitarian and bureaucratic terms of the employment relationship. However, trade unionism does not have a universal format that is applicable to every state; organizations are often bureaucratically complicated by the governments of the countries in which they operate, this rule of governance is what gives unions an identity. Hyman (2001) states that these identities are viewed as inherited traditions that shape current choices, pursued agendas, and the type of power resources that are cultivated and applied.

Drawing from theories regarding convergence and divergence can elucidate the challenges faced by trade unions, particularly when discussing comparative industrial relations. The convergence theory focuses on economic forces which tend to override diversity both culturally and institutionally, with ‘best practice’ production and employment systems defining industrial relations (Kerr, et al., 1960). Conversely, there are example nations such as the US and UK which hold institutional similarities that have contrasting economic performance that debunks the convergence theory. Divergence theory deliberates the enduring of cultural differences and societal structures, incorporating a societal effects framework that focuses on ‘nationally characteristic solutions’, the interactions between institutions, and their roles in relation to one another (Maurice, et al., 1980). These theories can be applied in an effective manner when discussing cultural and institutional differences at a national level; this paper will explore examples within the United Kingdom, Germany, and Hungary to address themes in relation to trade unionism.

When analyzing the role of trade unions among different countries, initially defining their theoretical approach to industrial relations provides a comprehensive indication to the state’s relationship with the unions. The United Kingdom historically a corporatist state now adopts a pluralist approach whereby there is conflict amongst employers and works (Budd, et al., 2004), however, it is contained by an appropriate regulatory system. Operating in a liberal market economy, union representation and bargaining power is fairly weak, with a lack of state support meaning individual protection is limited. This voluntarist (Kelly & Frege, 2013) identity bestowed on the trade unions arose out of various union immunity legislation that became a tradition in British industrial relations. Kelly (2013) describes features of Britain’s voluntarist traditions to include non-legally binding collective agreements and a voluntary framework of state-provided dispute resolution facilities, meaning the State possessed no power to arbitrate union disputes.

When comparing this model to the German industrial relations system, it is of stark contrast. The post-wartime Collective Bargaining Act of 1949 established the ‘direct and enforceable power of collective agreement’ (Behrens, 2013) meant that the results of any collective bargaining agreement become legally binding until any new agreement is reached. This bargaining occurs at industry level; however, it is difficult to pinpoint Germany’s exact theoretical approach. With aspects of pluralism and corporatism, there are complexities in the relationship between the state and the employers than cannot be inferred by conventional theories of interest representation. The state is able to lend trade unions organizational support through rules of ‘political influence’ that are favourable with them (Streeck, 1983). Streeck goes onto mention that business associations also become effectively involved in the formulation and implementation of public policy through this approach, preferring autonomy from the state and influence. Trade associations in Germany represents industry to the public and the state (Behrens, 2013) and may fend off legislative state interference with association members (Streeck, 1983) which could negatively affect sectoral level relations.

A more radical theoretical approach is adopted by Hungary; with a history of political and financial volatility such as the collapse of the Soviet Union and it’s 2006 financial crisis, the Central European nation has been governed by Viktor Orban’s authoritarian, neo-liberal approach since 2010 (Stanojevic, 2014). The current industrial relations system does not prove fruitful for trade union membership with only 12% density (European Trade Union Institute, 2016) compared to the United Kingdom and Germany which are 21% and 26% respectively, this has resulted in the majority of bargaining occurring at an organizational level and the state operating unilaterally. An example of this is the wage bargaining structure reform in 2010, whereby a tripartite negotiation council was replaced by a multi-partite system which resulted in the minimum wage being set by the government. The importance of trade unions in Hungary diminished further in 2012 with the introduction of the labour code legislation, which placed restrictions on strikes and union representation, additionally decentralizing the collective bargaining structure (Stanojevic, 2014). It is evident that as a labour market institution, trade unions within Germany can provide institutional acting regulation at a national level, as proven through German trade union involvement in policy-making. The United Kingdom is positionally unclear with no truly centrally-regulated industrial relations system, and with Brexit jeopardizing the influence of EU membership on domestic employment legislation (Coulter & Hancké, 2016), defining a clear union identity is proving to be problematic.

Using Hyman’s eternal triangle, you can identify trade unionism in the United Kingdom along the Market-Class line. The ‘Market’ annotation describes union interests as a focus on the standardization of terms and conditions of employment, with an emphasis on collective bargaining. Whereas, the ‘Class’ annotation portrays unions as ‘schools of war’ meaning they are used as an instrument to generalize class demands within states possessing anti-capitalist ideologies (Hyman, 2001). The United Kingdom has traits of the ‘Class’ principles, with increasing merger activity; three of the biggest British trade unions are a result of various mergers which highlights the idea of creating a generalized viewpoint from various unions combining. Relating this to the collective bargaining stance, the majority of workplaces are covered in ‘single-table’ bargaining (Kelly & Frege, 2013) where unions all negotiate together, highlighting the ‘Market’ ideologies of the prominence of collective bargaining and ensuring the standardization of the terms of employment (Hyman, 2001).

German trade unionism adopts a similar approach, employing aspects of the ‘Market’ orientation with the introduction of the 1949 Collective Bargaining Act to establish bargaining at industry and company level. However, Germany differs to the United Kingdom and interprets unions as social partners as well; focusing on the importance of a social dialogue between labour and capital and the emphasis on integration through institutional mechanisms (Hyman, 2001). This is made apparent through the rebuilding of trade unionism in Germany after 1945, whereby the new program had the objective of reorganizing the economy and society based on the concept of ‘social ownership’. (Behrens, 2013). This was comparable to the Hungarian industrial relations model, that focused on creating a social dialogue within its public sector. Nevertheless, this system was not based on collective bargaining, and state decree was much more prominent (European Trade Union Institute, 2016), which was conflicting of relations in Germany where state intervention was minimal thanks to the autonomist approach of its bargaining actors when negotiating the conditions of employment.

The effect of globalization on the labour market, in particular the presence of multinational corporations emerging as powerful political actors allows us to explore regulatory relationships on an international level. Globally, these is no central regulator or national laws where multinational operation is weak, poorly enforced or simply non-existent (Scherer & Palazzo, 2008) which draws these firms into roles with greater political influence (Ruggie, 2017) carrying out legislation traditionally associated with the state. Drawing on Piazza’s (2005) work, globalization fuels international competition which in turn, can promote wage restraints. Hungary is an example of a country that has bared the negative effectives of multinational competition and globalization in general. German organizations setup their Central European subsidiaries in Hungary due to low labour costs (Meardi, et al., 2009) and its ability to operate in an isomorphic manner with Germany as a result of similarities in industrial relations models. Firms from the United States opted to invest in business subsidiaries in Hungary as well, allowing German firms to operate under the American model for employment practice, meaning the codetermination style adopted in Germany was not meaningfully implemented in Hungary (Meardi, et al., 2009). This influence of macroeconomic forces has an effect on trade unions and workers (Piazza, 2005), decentralizing the wage bargaining structure and negatively manipulating union density and creating a labour quiescence. German employers operate with extremely competitive strategies, relying on high quality and efficient production which is evidence particularly in the automotive industry. This strategic approach means that the firms are immensely reliant on stable relations at company level, also increasing their vulnerability to ‘overt industrial strife’ (Thelen, 2000; Thelen & Kume, 1999). This draws from Hall and Soskice’s (2001) ‘institutional complementarities’ concept which explores the idea that two institutions can complement each other if the presence of one increases the returns from the other. However, this is a notion that is highly critiqued with Frege and Kelly (2013) asserting that it ‘understates the nature of conflict and power within capitalist social relations and attacks welfare and employment rights.

Conversely, the United Kingdom has an industrial relations system that is very liberal, meaning societal trends and working life remain relatively consistent. Therefore, globalization in this case is prolific; there is growth in foreign direct investment and a multinational company presence containing isomorphic employment practices. Furthermore, like Germany and Hungary, globalization is standardized by the fact all three nations have membership to the European Union meaning there is influence on labour practices and standards. Although, the aforementioned impact of Brexit on employment and industrial relations is still unclear.

Looking towards the future of systematic European industrial relations, the weakening of collective actors appears to be the defining threat, along with the positioning of bargaining structures. In the German model, trade union density has declined from 30-40% in the 1970s to 21% in recent times (Eurofound, 2015). This may be a result of the increasing autonomism amongst unions that are attempting to establish an identity with increasing competition from confederal unions. The employers themselves are gradually moving away from employers’ associations and new firms are not joining these associations at all. Financial capitalism has been the driving force of German industrial relations in recent years thanks to the liberalization of financial markets and the changing or corporate strategy and state regulation (Brinkmann & Nachtwey, 2013). Increasing shareholder-value orientation of German multinationals and the privatization and liberalization of industries owned by the state created a tendency toward bargaining decentralization. This collective bargaining system and the decline of overall coverage resulted in an increase in wage dispersion, particularly in the lower third of society (Lehndorff, 2009) has resulted in a growing low-wage economy with ‘precarious’ employment affairs (Brinkmann & Nachtwey, 2013) and rebuilding those relations is Germany’s biggest challenge; the introduction of a uniform national minimum wage in 2015 infers the intent from the state to rectify this.

In the current context of Hungary, trade union density is very low at 12% and membership has halved over the last 20 years (European Trade Union Institute, 2016). The union movement is fragmented into 4 separate federations which although provides a plethora of options for workers, the lack of standardization in relations is unsettling for workers in regard to employment security. A further challenge is that political affiliations are a dominant actor within industrial relations. Socialist parties are weak, with the conservative FIDESZ government operating under an overwhelming majority; there are vast constraints on the independence of the judiciary (Stanojevic, 2014) meaning it is legislation reform and labour market regulation is problematic. The inevitable result of a system where regulation is needed but the state possesses the overruling power is affirmative action. However, the government’s abolishment of the tripartite negotiating body and its statutory rights make it practically impossible to call a strike legally (Toth, 2015) leaving workers in a motionless position.

Another challenge unions will encounter incorporates political uncertainty which is mainly ostensible in the case of the United Kingdom, but also within Hungary. Hungary’s criticism of the European Union, hailing the European model as ‘doomed to decline (Toth, 2015) separates the country from the rest of the continent and potentially weakening its negotiating position within the European union. Political uncertainty within the UK ha also affected trade unions with much of the discussion concerning employment rights, industrial policy and corporate governance reform being marginalized by the focus on exiting the European Union. UK unions are already struggling to establish a clear identity and Brexit will place restrictions on their attempts to urge for legal reforms as the state will be largely unreceptive (Sippitt, 2016). The role of unions in the will therefore be reduced to the simple representation of members in the workplaces of the UK, facing potential periods of cut backs in the initial economic uncertainty of Brexit.

In conclusion, this paper addresses the role and status taken up by trade unions within the industrial relations systems of three nations that contain variables within the macro and micro environment which affect the identity and actions of said unions. In general, it would appear that aspects from pluralist and corporatist approaches to industrial relations result in the most positive outcomes. Hungary’s radical, authoritarian government and state-controlled legislation places major constrictions on the role of unions and this fragmented system creates vulnerability in terms of regulation. The Hungarian industrial relations system does promote multinational corporation connections, with many western industries building their subsidiaries in central European countries with a similar system to Hungary. Due to the financial influence of multinational corporations, the structure industrial relations within the ‘host’ nation is altered to accommodate that of the ‘home nation’ meaning new reforms to legislation can transpire and benefit the industry workers of that country. The positioning of a nations bargaining structure diminishes the power of trade unions, however, this is not a uniform concept; the United Kingdom and Germany have both seen a dramatic decentralization of collective bargaining in recent decades, however, the degree and timing of this process has significantly differed between the two countries and in turn, affected the level of power retained in the respective unions. Bargaining coverage is almost twice as high in Germany compared to Britain and the German unions have been more successful in maintaining low wage differentials within industries (Wergin-Cheek, 2012). This is a result of external factors such as the political environment, institutional infrastructure, and the economy, all of which vary greatly between Germany and the United Kingdom. So, from this, it is inferred that the institutional context of a nation will affect its implementation of a model of capitalism such as trade unionism. We can attribute the vast decline in trade union membership to the structural alterations many countries have seen in the last few decades; Hungary are a key example of this process hence their reference in this paper. The nation has historically and politically fluctuated to a huge degree over previous decades; for example, the move toward an economic and political liberalization were met with the Soviet invasion, the collapse of the union in the 1990s resulted in a move to a market economy resulting in trade union developments and mass privatization. Additionally, the country has joined the European Union and had a financial crisis, all of this causes volatility in regard to the role and status of trade unions hence the underlying theme of this paper deliberates the ideology that union challenges are comparative to industrial actors and the state frameworks in which they operate.