Collective Bargaining

AAA

DEFINITION of 'Collective Bargaining'

The process of negotiating the terms of employment between an employer and a group of workers. The terms of employment are likely to include items such as conditions of employment, working conditions and other workplace rules, base pay, overtime pay, work hours, shift length, work holidays, sick leave, vacation time, retirement benefits and health care benefits.

In the United States, collective bargaining takes place between labor union leaders and the management of the company that employs that union's workers. The result of collective bargaining is called a collective bargaining agreement, and it establishes rules of employment for a set number of years. The cost of this employee representation is paid by union members in the form of dues. The collective bargaining process may involve antagonistic labor strikes or employee lockouts if the two sides are having trouble reaching an agreement.

INVESTOPEDIA EXPLAINS 'Collective Bargaining'

In the United States, there are unions in both the private sector and the public sector. As of 2009, about 7.2% of private sector employees and 37% of public sector employees were unionized. Categories of workers that belong to unions include grocery store employees, airline employees, professional athletes, teachers, auto workers, postal workers, actors, farm workers, steel workers and many more.

RELATED TERMS
  1. Labor Union

    An organization intended to represent the collective interests ...
  2. Unofficial Strike

    A work stoppage by union members that is not endorsed by the ...
  3. Official Strike

    A work stoppage by union members that is endorsed by the union ...
  4. International Labor Organization ...

    A United Nations agency that strives to serve as a uniting force ...
  5. Department Of Labor - DOL

    A U.S government cabinet body responsible for standards in occupational ...
  6. Organized Labor

    An association of workers united as a single, representative ...
Related Articles
  1. The Economics Of Labor Mobility
    Economics

    The Economics Of Labor Mobility

  2. Unions: Do They Help Or Hurt Workers?
    Economics

    Unions: Do They Help Or Hurt Workers?

  3. Lump Sum Versus Regular Pension Payments
    Retirement

    Lump Sum Versus Regular Pension Payments

  4. Is That Airline Ready For Lift-Off?
    Active Trading

    Is That Airline Ready For Lift-Off?

comments powered by Disqus
Hot Definitions
  1. Market Segmentation

    A marketing term referring to the aggregating of prospective buyers into groups (segments) that have common needs and will ...
  2. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  3. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  4. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  5. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  6. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
Trading Center