National law institute university, bhopal

Project
Of

LABOUR LAW
On

COLLECTIVE BARGAINING AND TRI-PARTITE

AGREEMENTS

Submitted to:-Mr. Mahendra Soni

Submitted by:-Amit Dubey

Roll no.-2013BALLB45
 CONTENTS

Introduction ................................................................................................................................................................................. 1

Aims and Objectives ............................................................................................................................................................ 2

Balances the Legitimate Expectations ......................................................................................................... 2

Maintain Equality ................................................................................................................................................. 2

Promote Industrial Democracy ...................................................................................................................... 3

Rule-making Function ........................................................................................................................................ 3

Types of Collective Bargaining ....................................................................................................................................... 4

Conditions of Collective Bargaining ................................................................................................................................. 4

Levels of Collective Bargaining .......................................................................................................................................... 5

3. Corporate-Level Bargaining............................................................................................................................. 6

4. Plant-Level Bargaining ....................................................................................................................................... 6

5. Craft-Level Bargaining ....................................................................................................................................... 6

Collective Bargaining in India ........................................................................................................................................... 6

Origin & Development ....................................................................................................................................................... 6

Validity & Recognition....................................................................................................................................................... 7

Recognition ......................................................................................................................................................................... 10

International conventions on collective bargaining.11

Tri- partite agreements..12

Difference between tri-partite and bipartite agreements.13

Conclusion.15
 INTRODUCTION

Peace is sine qua non for development and disputes dissipate valuable time, effort and money of the
society. But, in a realistic sense, conflict is inevitable. Commerce, business, development work,
administration, etc., all suffer because of long time taken in resolving disputes through traditional court of
law. To get out of this maze of litigation, there is an alternative methods of industrial dispute resolution
namely; collective bargaining, conciliation, mediation, arbitration, workers participation in management,
wage boards etc. Of all these, collective bargaining is considered as the best possible method because in
this the disputants themselves sit together and resolve their differences in an amicable and respectable
manner. A number of theories from the fields of industrial relations, economics, political science,
history and sociology as well as the writings of activists, workers and labour organizations have attempted
to define and explain collective bargaining. One theory suggests that collective bargaining is a human
right and thus deserving of legal protection1. In June 2007 the Supreme Court of Canada in Facilities
Subsector Bargaining Assn. v. British Columbia 2 extensively reviewed the rationale for considering
collective bargaining to be a human right. The Court made the following observations in this case:

The right to bargain collectively with an employer enhances the human dignity, liberty
and autonomy of workers by giving them the opportunity to influence the establishment
of workplace rules and thereby gain some control over a major aspect of their lives,
namely their work. Collective bargaining is not simply an instrument for pursuing
external endsrather [it] is intrinsically valuable as an experience in self-government.
Collective bargaining permits workers to achieve a form of workplace democracy and
to ensure the rule of law in the workplace. Workers gain a voice to influence the
establishment of rules that control a major aspect of their lives.

Thus, collective bargaining is the process of negotiation between firms and workers representatives for
the purpose of establishing mutually agreeable conditions of employment. The parties often refer to the
result of the negotiation as a collective bargaining agreement or as a collective employment agreement. It
is called collective because both the employer and the employee act as a group rather as individuals. It is

1
United Nations General Assembly (1948). "Article 23". Universal Declaration of Human Rights. Paris. Retrieved on
29 August 2007. Article 23 of the Universal Declaration of Human Rights identifies the ability to organise trade unions as
a fundamental human right. Further, Item 2(a) of the International Labour Organization's Declaration on Fundamental
Principles and Rights at Work defines the "freedom of association and the effective recognition of the right to collective
bargaining" as an essential right of workers. (International Labor Organization (1998). Declaration on Fundamental
Principles and Rights at Work. 86th Session: Geneva.
2
2007 SCC 27

1
known as bargaining because the method of reaching an agreement involves proposals and counter
proposals, offers and counter offers and other negotiation. Collective bargaining provides for procedural
and substantive rules. While procedural rules concern mechanism for dealing with interpretation and
implementation of agreements as well as resolving conflicts, substantive rules concern the substance of
the agreement, both market (terms and conditions of employment) and managerial relationship (control on
manning, transfers, promotions etc).

Aims and Objectives

The aims and objectives of collective bargaining includes the following:

BALANCES THE LEGITIMATE EXPECTATIONS Management can legitimately expect

that most qualified labour will be available at a price which permits a reasonable margin for
investment. On the other hand, labours can claim job for each worker and steady increment in
the wages. In other words, managements interest in planning production and in being
protected against its interruption is the exact equivalent to the workers interest in planning
his and his familys life and in being protected against an interruption in his mode of
existence, either through a fall of his real income or through the loss of his job. Collective
Bargaining balances this conflicting interest through the process of negotiation3.

MAINTAIN EQUALITY Collective Bargaining is a means to maintain equality between

the worker and the workmen as the latter is at least advantageous position from the outset.
The bargaining power of an individual worker is, more often than not, quite weak because of
factors like illiteracy, indebtedness and socio-economic backwardness. Therefore, there is no
match for the economically and consequently, political, superior employer. These expose the
worker to exploitation, discrimination and indignities. As Lord Wedderburn rightly argues,
the Common Law assumes that it is dealing with a contract made between equals, but in
reality, save in exceptional circumstances, the individual worker brings no equality of
bargaining power to the labour market4

3
Power stands against power. It is the conflict of interests which makes their agreements a valid instrument of social
engineering
4
Lord Wedderburn, The Worker and the Law (1986)

2
 PROMOTE INDUSTRIAL DEMOCRACY Trade Union seeks to promote industrial
democracy. They have now come to symbolize: workers right to organize, to put forth their
demands collectively and to resort to industrial action, i.e; strike, when their demands are not
conceded by their employers. They seek to impress upon their employers that their collective
voice be heard when decisions affecting their working lives are made. Thus, union assures
that individual interest should be subordinated to the collective well being of its members.
Given that joint regulation takes place of authoritarian decision making, collective bargaining
can be a vehicle for the democratization of industrial life5. The International Confederation of
Free Trade Union stated that the objects of the collective bargaining is to express in practical
terms the workers desire to be treated with due respect and to achieve democratic
participation in decision affecting their working conditions.

RULE-MAKING FUNCTION Collective bargaining performs rule-making function.

Collective Agreements govern employment relationships in the bargaining unit and thereby
create generally applied standards. This indicates the power of groups to provide for their
own internal regulation (e.g; by custom and practice) and that there are limits to the sovereign
power of an employer. Collective bargaining can thus be regarded as an expression of
pluralism.

Thus, collective bargaining is not just a means for raising wages and improving conditions of
employment. Nor is it merely democratic government in industry. It is above all a technique whereby an
inferior social class or group exerts a never- slackening pressure for a bigger share in social sovereignty,
as well as for more welfare and greater security and liberty20. In short, collective bargaining helps in
21
establishment and maintenance of the mutual relations of the workers and the management .
Consequently, it strengthens the union as an organization. Further, it makes enterprise more responsive to
human needs.

5
R. Blanpain & C. Engels, Industrial Relations and Labour Laws, 4 th Ed. Reprint, 2002, Vikas Publishing House Pvt. Ltd.,
New Delhi.

3
 Types of Collective Bargaining

There are two types of bargaining exercises conjuritive or distributive bargaining and intergrative or
Cooperative bargaining. Though both aim at joint decision making, their processes are not same.
Distributive bargaining deals with issues in which parties have conflicting interests and each party uses its
coercive power to a maximum extent possible. In such a situation, one partys gain is the others loss.
Wages bargaining is an obvious example of distributive or conjunctive bargaining. In contrast to the win-
lose syndrome, integrative bargaining is concerned with the solution of problems confronting both parties.
It is a situation where neither party can gain unless the other gains as well. It makes a problem solving
approach in which both the parties make a positive joint effort to their mutual satisfaction. Productivity
bargaining is an instance of integrative bargaining. Productivity bargaining may broadly be described as
agreements in which advantages of one kind or another, such as higher wage or increased leisure, are
given to workers in return for agreement on their part accept changes in work practices, methods work,
etc.

Conditions of Collective Bargaining

There are certain preconditions without which collective bargaining cannot exist. These are generally as
follows:

1. PARITY OF POWER BETWEEN THE TWO PARTIES management and unions should be more
or less equal in the matter of power or strength to achieve genuine bargaining status. A weak union cannot
force management even to bargain, let alone achieve anything of substance for its members. Similarly,
weak management can surrender so many things to powerful unions that the agreement cannot be
rightfully said to represent the results of a bargain. For example, excessive political interference and
supervision by the ministries weakens the management and make union appears larger than they really
are.

2. BARGAINING IN GOOD FAITH the bona fides of the bargaining parties have to be clear right from
the start and the existence of hidden agendas can only hamper the process. For example, if bargaining is
taken towards deadlock as a pretext to close down the plant.

4
3. MECHANISM TO BREAK A DEADLOCK bargaining may often result in a stalemate, with neither
managements nor unions budging from their respective offers or demands. The breaking of this deadlock
can be achieved in two ways, either through an ultimatum like strikes or lockouts, or through third party
mediation, like arbitration or conciliation.

Levels of Collective Bargaining

Collective bargaining takes place in varied ways. The forms vary from those where the government plays
a negligible role to those where the government intervenes substantially, or to those where it is out and
out tripartism. Technically speaking, collective bargaining varies in levels from national to craft.

1. NATIONAL-LEVEL BARGAINING This type of bargaining takes place between employers

organisations and the dominant union centre over issues which are rudimentary and basic to industrial
working. These could be basic wage rates or the basic formula for cost of living adjustment and may take
place annually or after gaps of two or three years. The implication would be that these basic issues are
uniformly accepted by all industries and all industrial workers. This type of bargaining is relatively easier
to follow in small homogeneous industrial structure. Therefore it is not possible in India because of its
large size and heterogeneity. However, in India, since the early 1970s, sectoral bargaining at the national
level is occurring in industries in which the government is a dominant player . The advantage of this type
of bargaining is its standardisation of wage and avoidance of disputes on the plea of disparity. But, there
is little room for flexibility and therefore does not allow variations on the issues.

2. INDUSTRY-LEVEL BARGAINING In this type, employers organisations or bodies in one industry

jointly bargain with unions in that industry. These Unions are organised either as industry federations or
registered on the industry basis, with branches in different plants of that industry. The issues in this type
of bargaining is not limited to basic wages and allowances but also includes basic production norms and
working conditions, peculiar to that industry. This type of bargaining is common in cotton and jute
textiles, engineering and tea, which are dominated by the private sector.

5
3. CORPORATE-LEVEL BARGAINING This occurs when the corporate management of a multi-
plant enterprise negotiates one agreement with various unions for all its plants. The bargaining is usually
conducted by corporate management with representation from its different plants. It is practised in most
large public sector undertakings, which have several establishments in various regions of the country .
The main advantage of this system is wage uniformity between the various establishments and avoidance
of disputes on grounds of disparity. But at the same time, the system is rigid to take into account the
differences between plants, products, or technologies, which may be due to age, size or employment
patterns, and the resultant performance.

4. PLANT-LEVEL BARGAINING In this type of bargaining, the management of a particular plant or

factory or establishment bargains with the unions of that establishment or unit. The issues obviously can
be as comprehensive and detailed as possible, and relate entirely to the performance of that
establishment. Most private sectors in India practise this system of bargaining.

5. CRAFT-LEVEL BARGAINING In this type of bargaining, the employer bargains separate

agreements with different craft unions within the same enterprise. This system is not common in India
with airlines as an exception.

COLLECTIVE BARGAININ G IN INDIA

ORIGIN & DEVELOPMENT

Since Collective Bargaining is the off-shoot of Trade Union activity, it is worthwhile to trace the origin of
Trade Union first. The credit for organised labour movement in India goes to N.M. Lokhande, who was a
factory worker himself. In 1884, he organised an agitation in Bombay and prepared a memorandum
demanding limitation of working hours, a weekly rest day, compensation for injuries etc. and in response
of these demands a weekly holidays was actually granted by the mill owners of Bombay. In fact, in 1890,
the Bombay Mill hands Association was organised with Lokhande as chairman and workers newspaper
Deenabandhu was started. The trade union movement got its momentum at the close of the World War

6
I and the period of 1918-21 was an epoch-making period in the history of Indian labour movement. The
Madras Labour Union (1918) founded by P.P. Wadia was the first Indias Trade Union. By the year 1920
the Trade Union had emerged on the Indian Scene in almost all the sector to protect the legitimate
interests of the working classes. Collective Bargaining formally started in 1920s in the textile industry in
Ahmedabad at the time when Mahatma Gandhi was introducing the concept of arbitration. Collective
Bargaining started because of failure of arbitration . Thereafter, lots of collective bargaining agreements
were executed especially after Independence. But there was little support for the growth of this practice,
40
since neither British India nor Independent India made legal provisions for collective bargaining .
Nevertheless, like many other countries, collective bargaining in India got some impetus from various
statutory provisions. The Trade Union Act, 1929, the Bombay Industrial Relations Act, 1946, the
Industrial Disputes Act, 1947, and the Madhya Pradesh Industrial Relations Act, 1960 provided a
machinery for consultation and paved the way for Collective bargaining.

VALIDITY & RECOGNITION The analysis of the following documents along with the decisions
of the Court justifies the legality and recognition of collective bargaining in India.

1. Industrial Disputes Act, 1947 The Act is basically enacted for providing the mechanism for the
settlement of disputes41. According to Section 18 of the Act, A settlement arrived at by agreement
between the employer and workman otherwise than in the course of conciliation proceeding shall be
binding on the parties to the agreement . Thus, settlement other than conciliation which may take
place by a binding agreement between the employer and the employee is nothing but an implication of
the collective bargaining agreement. In other words, Section 18 recognises collective bargaining. In fact,
the definition of settlement under the Act itself contains the element of collective bargaining6.

In the case of Workmen of Dimakuchi Tea Estate vs. The Management of Dimakuchi Tea Estate7, the
examination of the salient provisions of the Act shows that the principal objects of the Act are (1) the
promotion of measures for securing and preserving amity and good relations between the employer and

6
"settlement" means a settlement arrived at in the course of conciliation proceeding and includes a written agreement
between the employer and workmen arrived at otherwise than in the course of conciliation proceeding where such
agreement has been signed by the parties thereto in such manner as may be prescribed and a copy thereof has been sent to
an officer authorised in this behalf by the appropriate Government and the conciliation officer (Section 2(p))
7
AIR 1958 SC 353

7
workmen; (2) an investigation and settlement of industrial disputes, between employers and employers,
employers and workmen, or workmen and workmen, with a right of representation by a registered trade
union or federation of trade unions or association of employers or a federation of associations of
employers;.and (5) collective bargaining.

Further, in Karnal Leather Karamchari Sanghatan (Regd.) vs. Respondent:Liberty Footwear Company
(Regd.) and Ors8, the Court laid down that the Act (Industrial Disputes Act, 1947) seeks to achieve social
justice on the basis of collective bargaining. The voluntary arbitration is a part of infrastructure of
dispensation of justice in the industrial adjudication. The arbitrator thus falls within the rainbow of
statutory tribunals. When a dispute is referred to arbitration, it is therefore, necessary that the workers
must be made aware of the dispute as well as the arbitrator whose award ultimately would bind them.
They must know what is referred to arbitration, who is their arbitrator and what is in store for them. They
must have an opportunity to share their views with each other and if necessary to place the same before
the arbitrator. This is the need for collective bargaining and there cannot be collective bargaining without
involving the workers. The Union only helps the workers in resolving their disputes with management but
ultimately it would be for the workers to take decision and suggest remedies. It seems to us therefore, that
the arbitration agreement must be published before the arbitrator considers the merits of the dispute. Non-
compliance of this requirement would be fatal to the arbitral award.

In the case of Amalgamated Coffee Estates Ltd. vs. Workmen9, the Apex Court held that the process of
negotiated settlements is at the heart of the solution of the collective disputes. Unlike a settlement in the
course of conciliation proceedings, a bipartite settlement with a majority union is equally binding if it is
held to be fair and reasonable. Likewise, Central Provinces Transport Services vs. Patwardhan10, the
Court held that the Industrial Disputes Act essentially deals with collective disputes.

2. Trade Union Act, 1926 The Act provides for the registration of trade union and determines the rights,
liabilities and immunities of the union. The primary purpose for the formation of the trade union is to
regulate the relations between the employer and employee or among themselves and it is well established

8
(1989)4 SCC 448
9
1965 II LLJ 110 SC
10
(1956) SCR 956

8
that collective bargaining is one of the means of regulating such a relation. In the case of D.N. Banerjee
vs. P.R. Mukherjee11, the court recognises collective bargaining. Justice Chandra Shekhar Aiyer observed
that having regard to the modern condition of society where capital and labour have organised
themselves into groups for the purpose of fighting their disputes and settling them on the basis of the
theory that Union is Strength, collective bargaining has come to stay.

Further, in Tamil Nadu Electricity Workers Federation vs. Madras State Electricity Board12, the Madras
High Court observed that the whole theory of organised labour and its statutory recognition in industrial
legislation, is based upon the unequal bargaining power that prevails as between the capital employer and
in individual workman, or disunited workman. Collective bargaining is the foundation of this movement,
and it is in the interest of labour that statutory recognition has been accorded to Trade Unions and their
capacity to represent workmen, who are members of such bodies.

3. The Industrial Employment (Standing Orders) Act, 1946 Standing Order is drafted by the employer
which contains the conditions of employment. As per Section 3 of the Act, initially, the employer needs
to submit the draft standing order to the Certifying Officer which should be in conformity to the model
standing order as far as possible. Thereafter, the said Officer forward the copy of the draft to the trade
union or to the workmen, if there is no trade union for seeking objections (if any) and after giving both
the parties an opportunity of being heard, the Officer shall certify the standing order with necessary
modifications (if required) and shall send it copies to both the parties13.

11
1 L.L.J. 1951 (SC)
12
AIR, 1965 Mad. 111
13
Certification of standing orders

(1) On receipt of the draft under section 3, the Certifying Officer shall forward a copy thereof to the trade union, if any, of
the workmen, or where there is no such trade union, to the workmen in such manner as may be prescribed, together with a
notice in the prescribed form requiring objections, if any, which the workmen may desire to make to the draft standing
orders to be submitted to him within fifteen days from the receipt of the notice.

(2) After giving the employer and the trade union or such other representatives of the workmen as may be prescribed an
opportunity of being heard, the Certifying Officer shall decide whether or not any modification of or addition to the draft
submitted by the employer is necessary to render the draft standing orders certifiable under this Act, and shall make an
order in writing accordingly.

(3) The Certifying Officer shall thereupon certify the draft standing orders, after making any modifications therein which
his order under sub-section (2) may require, and shall within seven days thereafter send copies of the certified standing
orders authenticated in the prescribed manner and of his order under sub-section (2) to the employer and to the trade union
or other prescribed representatives of the workmen (Sec. 5)

9
4. The Constitution of India The Constitution of India in the Chapters on Fundamental Rights and
Directive Principles of State Policy justify the legality of collective bargaining. In this context, Article 19
permits to form association which implicates the validity of trade union and as mentioned above that one
of the main purposes of trade union is collective bargaining. Further, several Directives Principles also
justifies the provisions for improving the conditions of the labour in general and Article 43-A in particular
provides that State shall ensure the participation of workers in the management. Although the said
Directives are not directly enforceable in the court of law, still its binding nature can by established with
the help of some decisions of the Apex Court of India. In Re Kerala Education Bill case14, the Supreme
Court observed that though the directives principles cannot override the fundamental rights, nevertheless,
in determining the scope and ambit of fundamental rights the court may not entirely ignore the directive
principles but should adopt the principles of harmonious construction and should attempt to give effect
to both as much as possible.

Recognition

Recognition is the process through which management acknowledge and accept a trade union as
representative of some or all of the workers in an establishment or industry and with which it is willing to
conduct discussions on all issues concerning those workers. When this acceptance also includes the
willingness of the management to bargain with that union or unions, they may be termed as bargaining
agent or agents. The National Commission on Labour attached considerable importance to the matter of
recognition of unions. The Commission stated that the provision for union recognition has been realised is
evident from theBombay Industrial Relations Act, 1946 and certain other state Acts (Madhya Pradesh
and Rajasthan), the amendments incorporated (but not enforced) in the Trade Union Act and the Code of
Discipline, as also the fact that it was included in the Second Plan. The Commission suggested a
compulsory recognition of the union under a Central Law in all undertaking employing 100 or more
workers or where the capital invested is above a stipulated size. The Commission also recommended the
rights of the recognised unions. Nevertheless, there is no law at the national level for recognition of trade
unions. However, some States such as Maharashtra, Andhra Pradesh, Madhya Pradesh, West Bengal and
Orissa have enacted the legal provisions for the recognition. Thus, it is evident that in spite of absence of
expressly centrally enacted provisions on collective bargaining in India, there are enough protections for
the relevance of collective bargaining in India.

14
AIR 1957 SC 956

10
 INTERNATIONAL CONVENTIONS ON COLLECTIVE BARGAINING

1. Right to organize and collective bargaining convention,1949

It is the General Conference of the International Labour Organisation, Having been convened at
Geneva by the Governing Body of the International Labour Office, Having decided upon the
adoption of certain proposals concerning the application of the principles of the right to organise
and to bargain collectively

Article 1-Workers shall enjoy adequate protection against acts of anti-union discrimination in
respect of their employment.

Such protection shall apply more particularly in respect of acts calculated to--

(a) make the employment of a worker subject to the condition that he shall not join a union or shall
relinquish trade union membership;

(b) cause the dismissal of or otherwise prejudice a worker by reason of union membership or
because of participation in union activities outside working hours or, with the consent of the
employer, within working hours.

2. Collective bargaining convention, 1989

Aims of the convention:

(a) collective bargaining should be made possible for all employers and all groups of workers in the
branches of activity covered by this Convention;

(b) collective bargaining should be progressively extended to all matters covered by subparagraphs
(a), (b) and ) of Article 2 of this Convention;

(c) the establishment of rules of procedure agreed between employers' and workers' organisations
should be encouraged;

(d) collective bargaining should not be hampered by the absence of rules governing the procedure to
be used or by the inadequacy or inappropriateness of such rules;

(e) Bodies and procedures for the settlement of labour disputes should be so conceived as to
contribute to the promotion of collective bargaining.

11
TRIPART ITE AGREEMENTS

Tripartite agreements are same as the collective bargaining but the involvement of state government is
there in tripartite agreements. No interference by governor or ministry. It is governed by the convention of
Tri partite consultation (International Labour standards) convention,1976 which states that tripartite
means where the government consult is involved, representatives of employer and employee in framing
socio-economic policies at the national and industrial level and in particular in the legal framework of
labour relations and labour related policies.

Tripartite refers to situation where three parties namely- employer, employee and tends to
achieve the object of balanced industrial relationship along with industrial development of nation. In case
of tripartism government interferes as a third party and primary purpose of such intervention is the
protection of ultimate beneficiary i.e. consumers and ensuring that all the rules and laws are complied
with and nothing is happening in the industry against the procedure established by law.

In case of tripartism unique feature is that although government is acting as a third

party but its authority is exclusively restricted to the framing of terms of settlement not any more. As the
role played by the third party or government is of a facilitator rather than an arbitrator.

FEATURES;

Three parties are involved

Absence of authority-Although the agreement is entered by three parties but none of the parties
have authority to bound the others according to terms of settlement.
Terms of settlement are not final rather are in form of mere recommendation depend solely upon
wish of the parties to accept or reject the same.

NEED FOR TRIPARTISM:

Weak trade union- TU in India are not in a position to represent the grievances of employees due
to financial and statutory incapacities which makes them unable also for insisting hardly for their
demand.
Business friendly- Saves time and expenses.

12
 Ensures government control- In case of tripartism the authorized officer is acting on the behalf of
government and ensures compliance with laws and rules which is necessary for adequate
governance of industrial relations.
Labour welfare- Government acting as a third party tries to protect the employee against
exploitation and most of the agreed settlement are coloured with labour welfare provisions.
Prevents unfair labour practices like illegal act etc.

DIFFERENCE BETWEEN TRIPARTITE AND BIPARTITE

AGREEMENTS

Apart from the number of parties in the two relationships, there are several points of distinction between
them. First, tripartism operates at the national, industry or provincial levels. It cannot simply that
tripartism operates at that level, in the same way that though the State prescribes rules relating to
marriage, it does not mean that the marriage relationship involves State participation. Even though labour
inspection is a process undertaken by the State with a view to ensuring the observance of laws and rules
required to be observed by enterprises, or at the enterprise level, it is not tripartism. Bipartism, on the
other hand, operates at all three levels, more particularly and frequently at the enterprise level.

A second distinction is based on the subject matter. In tripartite dialogue issues addressed are policy-
oriented. This is also the case in bipartite relationships when they occur at the national or industry level.
At the workplace level issues relate to the particular workplace, and are of a more practical nature.

Third, in regard to parties to the dialogue, tripartite processes involve representatives of employers and
employees, as does bipartism at the national, industry or provincial level. But at the enterprise level, there
is less scope for the involvement of employers' organizations, though such involvement does occur in
countries where the employers' organization negotiates on behalf of the employer in respect of workplace
issues such as disputes and strikes, wages and terms and conditions of employment. However, it may be
argued that when an employers' organization enters such negotiations, the matter is taken out of the
enterprise level. Bipartism can take place at the enterprise level even if there is no union. It is conceivable

13
for bipartism to operate in the same enterprise with or without a union at different levels. As in the case of
joint consultation in Japan, bipartism may operate in the form of workplace information-sharing through
group activities without the union, and at the corporate level through joint consultation committees
consisting of management and union representation. There is an interplay and interaction between
tripartism and bipartism. Since macro level decisions (which may be taken through tripartite consultation)
have little value if they are not translated into practice at the enterprise level, bipartism can be a process
for giving effect at the enterprise level to tripartite decisions. For example, Singapore's decision in the
second half of the 1980s to introduce a flexible wage system was the result of a tripartite consensus. But
implementation was determined on a bipartite basis, thus leaving employers and employees (and their
representatives) to opt between a profitability or productivity model (or a combination of both). There are,
of course, some tripartite decisions which do not call for implementation at the enterprise level, as in the
case of social security schemes operative at the national level.

Bipartism is not a process intended only to give effect to tripartite decisions. With the increasing
emphasis on workplace relations, macro level policies and decisions are influenced by what takes place,
or what is needed to support practices, at the micro level. Further, the outcomes of bipartite relationships
at the national, industry or provincial levels can have a major influence on tripartite consultation and
macro level policies. A good example is Sweden, where in the 1960s and 1970s the labour market was
regulated by the social partners and national policies reflected their agreements on labour market issues.
In its most advanced form, bipartism may lead to 'social contracts' as evidenced in some of the
Scandinavian countries and Germany, which define the basic relationship and objectives of the social
partners in the labour market.

Tripartism can become an important means to settle issues when bipartism does not result in a consensus.
When such failure leads to disputes, the State's involvement (including through conciliation and
adjudication) brings into play the tripartite process.

14
 CONCLUSION

Collective Bargaining is the process of joint decision making and basically represents a democratic way
of life in industry. For the success of collective bargaining the process must begin with proposals rather
than demands and the parties should be ready and willing to compromise otherwise the whole idea of
collective bargaining would be frustrated. In Indian context, the problem lies in the fact that in the
absence of any statutory provisions at Central Level for the recognition of a representative trade union by
an employer affects the bargaining power of the trade union. In addition, besides, unorganised labour
being a hurdle, the unions are generally weak. Rivalry on the basis of caste, creed, and religion is another
characteristic of Indian Trade Unions which come in the way of successful collective bargaining. Further,
division of union on the basis of political ideologies and weak financial position retards the growth of
Trade Unions.

Therefore, it is recommended that India should provides for a recognition of the Trade Union at the
central level, so that peace and harmony with the management and workers can be maintained, which
in turn can provide better service to the community and hence lead to the growth and development of
the economy. In fact, India is under international obligations to provide effective mechanism for
collective bargaining. In this regard, it is also recommended that India can ratify ILO Conventions
No. 87 of 1948 and No. 98 of 1949 both of these conventions assure the right to effective collective
bargaining. In short, we may say that the time has come for repeating the history. As per Sir Henry
Maine, the progressive society move from status to contract. However, given the necessity of
collective bargaining as an effective tool for the settlement of industrial dispute, the progressive
society has to move otherwise i.e; from contract to status rather than from status to contract.

15
16