Collective Bargaining Agreements


Introduction………………………………….Page 2
Management Rights…………………………Page 3
Union Security……………………………….Page 4
Wages and Benefits………………………… Page 5
Individual Security (Seniority) Rights……..Page 6
Dispute Resolution…………………………..Page 7
Bibliography…………………………………Page 10

A collective bargaining agreement collectively sets the terms on which an employer offers individual work contracts to each of its employees in the bargaining unit. A bargaining agreement, also herein referred to as a labor agreement, is a legally enforceable written commitment, which states the rights and duties of all parties involved. The labor agreement should be made in good faith and is intended to be observed and not violated. The National Labor Relations Act obligates employers and unions to bargain in good faith concerning terms and conditions of employment, including hours and wages.

Like any normal contract, competent parties must enter into a labor agreement. However, a labor agreement is unique from other legal contracts in that there is no consideration involved and nothing tangible is exchanged. Many, but not all, unions require formal ratification of a new labor contract by a majority membership acceptance, which is determined through vote by the members. Until majority approval of those voting in a ratification election is received, the proposed labor contract is not final.

While each labor agreement is unique to the needs of an organization and its employees, most agreements include five issues: (1) Management Rights, (2) Union Security, (3) Wages and Benefits, (4) Individual Security (Seniority) Rights, and (5) Dispute Resolution.
Management Rights
“Management” is the process of working with people and resources to accomplish organizational goals by making the best possible use of money, time, materials and people. The management process, when properly executed, involves a wide variety of activities including planning, organizing, directing and controlling. It is management’s role to perform all of these functions in order to maximize results. Management maintains the right to direct all business activities. In order to retain as much authority as possible in the direction of the workplace, management has sought to include certain provisions in collective bargaining agreements.

Management has no rights over individual people within the organization, but does maintain rights to property, which are real and legally enforceable. Management has sole discretion and flexibility in deployment and discipline issues and maintains the right to assign measures to people within the company, as it deems appropriate, as long as the language of the agreement does not explicitly limit the action.

A typical management rights clause reads as follows:
“The Company retains the exclusive right and responsibility to manage the
business and plants and to direct the working forces subject to the
provisions of this Agreement, including the right to hire, suspend, or
discharge for proper cause or transfer and the right to relieve employees
from duty because of lack of work or for other legitimate reasons.”
The effect of the management clause may be limited, in as much as, the company has a legal duty to bargain about many matters and may be required to do so, regardless of the employer rights clause in the agreement. Where there are rights, there are also obligations.

Union Security
In 1947 Congress wrote into the Taft-Hartley Act statutory provisions about union security. Union security clauses address status of employee membership in the union and attempt to ensure that the union has continuous strength. Nearly all contracts provide some type of union security clause. Forms of union security are outlined below:
Union Shop: A form of union security under which an employer may hire
a nonunion employee, but the employee must become a union member
within a specified period of time and remain a member in good standing
as a condition of employment.
Agency Shop: A union contract provision requiring that nonunion employees
pay to the union the equivalent of union dues in order to retain their
Closed Shop: A union security agreement by which only union members may
be hired. Now generally prohibited under federal labor statutes.
Maintenance of Membership: A mild form of union security that imposes no
obligation on an employee to join a union but merely the obligation to remain
a member in good standing for the duration of the collective bargaining
agreement if an employee has already joined a union.
Checkoff: A system by which an employer deducts union dues from the
employees’ paychecks and transfers the funds to the union.

Wages and Benefits
The amount of compensation, its forms, and the processes by which it is determined are