The Power of Collective Bargaining

Collective bargaining is perhaps one of the most important elements of union life. It’s also a pathway toward better working conditions, higher wages and fairer treatment across the board.

But these benefits don’t just happen. Collective bargaining is the product of multiple laws and lots of work, which is why it’s worth a closer look. Learn more about this process and why it’s so crucial for unions.

What is collective bargaining?

Collective bargaining is a negotiation between employers and employees, generally with unions acting as the middleman. The goal is to establish agreements regarding key topics such as:

  • Wages
  • Benefits
  • Work hours
  • Overtime
  • Leave
  • Workplace safety
  • Job health policies
  • Support for work/life balance
  • Training
  • Equal treatment

The American Federation of Labor & Congress of Industrial Organizations (AFL-CIO) calls collective bargaining “the best means for raising wages in America,” and the International Labour Organization (ILO) says it’s “a fundamental right.” According to AFL-CIO, three-quarters of private sector workers and two-thirds of public employees can take advantage of collective bargaining.

Whom to thank for collective bargaining

If you have the right to this potentially powerful process, generations of workers before you can take the credit. One of the earliest examples of collective bargaining dates to 1806, when shoemakers in Philadelphia worked together to set wages and refused to work for anyone who didn’t offer this pay. Courts at the time called this move “criminal conspiracy.”

It wasn’t until 1842 that the Massachusetts Supreme Court shifted the playing field, ruling that peaceful collective action wasn’t unlawful conspiracy. This decision didn’t necessarily put the problem to bed. State courts still jailed workers and union leaders, claiming there was a potential for violence, and employers were allowed to force new hires to sign contracts asserting they’d never join a union.

The U.S. made significant progress over the next century, passing two pieces of legislation that helped define collective bargaining as it exists today:

  • The Railway Labor Act: Enacted in 1926 and expanded to cover the airline industry in 1936, this act creates a system for bargaining, arbitration and more. The goal is to protect workers and prevent strikes.
  • The National Labor Relations Act (NLRA): The NLRA covers most private sector workers outside the railway and airline industries. It prohibits unfair labor practices, establishes a “duty to bargain” among employers, creates guidelines for impasses and more.

Stages of collective bargaining

Depending on the employer and union involved, collective bargaining can take a lot of forms. However, you can expect general stages like these:

  1. Preparation: Unions and employers both pick their bargaining teams based on relevant by-laws.
  2. Negotiation: Conversations may occur in multiple rounds and only cover those subjects that are allowed by law.
  3. Ratification: Representatives take tentative agreement terms back to their respective parties and either pass or renegotiate the contract until ratification.

 There are also steps for resolving disputes or making changes to an agreement after it’s finalized. These processes must follow specific guidelines designed to protect workers, employers and even supply chains and economies further down the road.

Why collective bargaining matters

There are plenty of reasons to take advantage of your collective bargaining power, including:

  • Benefits: Negotiation helps workers get what they need in terms of safety, support and compensation.
  • Proactive solutions: Clear communication between unions and employers can help address issues before they lead to interruptions, impacted workplace safety and potential strikes.
  • Compromises: By allowing all representative parties to have a say in negotiations, collective bargaining helps reach compromises that respect everyone’s priorities.
  • Morale: To achieve what ILO calls “increasing the consent of the governed,” collective bargaining ensures that grievances and concerns are addressed in a timely, effective manner.

When all these moving parts come together, great things can happen. Take, for example, the recent tentative agreement between the United States Steel Corporation and the United Steelworkers (USW). In late 2022, these parties collaborated on a four-year contract covering about 11,000 employees represented by the USW.

The main takeaway? Unions — and the people they represent — have the power to change workplaces through collaborative solutions. Collective bargaining is perhaps one of the biggest and most obvious pathways to this success, but it certainly isn’t the only one.