Blog
What is collective bargaining?
Published 12 March 2025
The age old saying of ‘strength in numbers’ and a group of people acting together having more power or influence than a single individual, is fitting when looking at collective bargaining.
The idea that a workforce can achieve much more if it is united and it stands together is at the heart of collective action.
Collective bargaining refers to the process in which employers and employee representatives, usually trade unions, negotiate and agree on terms and conditions of employment e.g. pay, working hours, benefits etc [1] cited 12.3.25
Trade unions do have a significant role to play in the process and in discussions with any employer, despite a decline in trade union membership.
Most recent figures show the number of UK employees who are trade union members fell to 22.3 per cent in 2022, down from 23.1 per cent in 202. [2] cited 12.3.25
The total number of trade union members among employees was 6.25 million in 2022, the lowest membership level since 2017 and it marked the second consecutive year of decline following four years of growth.
However, trade unions remain a persuasive voice in collective bargaining, and they still have a vital role in ensuring employees are treated fairly in the workplace.
One of the key benefits is that the process helps to balance the power dynamics between workers and their employers. Collective bargaining gives staff a combined and more effective voice to assert their rights and with which to serve their best interests.
Who can be involved in collective bargaining?
It can involve a number of different parties, with each having a particular role to play in the process. Here is a look at what can be five of the key players in the process:
- The staff: whose employment terms, including pay, hours of work and conditions, are being negotiated. Every employee will not directly take part in the process because they will usually be represented by trade unions.
Non-trade union members will still benefit from the process if they are working for an employer that recognises a union for the purposes of collective bargaining. Any terms that are negotiated and agreed will usually apply to all employees, whether or not they are a trade union member. The downside is that non-union members will not get the same level of representation as colleagues who are members of a union, and they can miss out on additional support or advice afforded to union members.
- Trade unions: can negotiate agreements with employers on pay and conditions and discuss members’ concerns with employers. A union will play a key role in representing staff during any negotiations, which at times can be complex, intense and challenging. [3] cited 12.3.25
Representatives will act as the voice for employees and work with an aim to secure the best possible deal in any situation, and one that will provide the most benefit to staff.
- Employers: The business or organisation which employs the workers is expected to act in good faith during any negotiations and to reasonably consider any proposals.
Employers must give certain information to the union to help it with a bargaining process e.g. the company's pay and benefits structure or information about its profits, assets and liabilities [4] cited 12.3.25
- ACAS: the government-funded independent body, which works with millions of employers and employees every year to improve workplace relationships, can provide support, advice, and mediation to help resolve disputes during collective bargaining.
- Government: it will not actually take part in all negotiations, but it does set the legal framework for collective bargaining through legislation such as the Trade Union and Labour Relations (Consolidation) Act 1992 [5]3.25
What can collective bargaining actually be used for?
It can be used in different sectors, especially those in which union representation is strong, during:
Contract renewals: Collective bargaining can be particularly effective in negotiating new terms when employment contracts are coming to an end.
Dispute resolution: As in any relationship, there can be disputes that occur in the working relationship and collective bargaining can be used to attempt to resolve significant disputes between an employer and its staff.
Organisational changes: Many employers are facing significant challenges in the current business climate and face having to adapt, in some cases just to remain operational. During any significant or necessary changes within a business e.g. mergers or restructuring, collective bargaining can be vital in making sure that employees' interests are considered.
How does it work?
The first and key step, which may sound obvious, is identifying and being clear on the particular issue that is to be negotiated e.g. pay or any specific working conditions.
The parties will then work together to agree how the process will be carried out. This will generally involve consideration of issues such as which employees will be covered by an agreement, how often meetings will take place, the identity of representatives who will play an active role in the process and methods for resolving any disputes.
This process can involve an in-depth study of the terms of any contract and other important documents. Information sharing and clarity on issues is a key part of the process, which will usually see union representatives requesting information from an employer to help with negotiations.
Once all necessary and required information and data is gathered, discussions can start in line with what has been agreed regarding how the process is to be conducted.
While the aim is to reach an agreement that is acceptable to all parties, the process can be difficult, challenging and prolonged, often taking several months or even longer to conclude.
Why can collective bargaining be both good and bad?
Good points
- Can help to secure improve working conditions, which benefit employees such as fair wages, reasonable working hours and other wide-ranging benefits.
- It can help to avoid a workforce taking strike action, as the structured process can be effective in resolving disputes.
- Health and safety are fundamental in any workplace and it can help to ensure and improve safety standards and to create a safer working environment for employees.
Bad points
- As with any process that is designed to be helpful, things can go wrong leading to tension and conflict between unions and employers which can result in staff walking out and going on strike.
- If negotiations are protracted it can be a time-consuming process with an inevitable cost for both parties e.g. significant resources and legal expertise.
- Agreements may sometimes not allow any room for flexibility, which can create issues if there is then a need to adapt to changing business conditions.
What happens when an agreement is reached?
When a collective bargaining agreement is reached, it will establish the particular terms and conditions that have been agreed, which become legally binding. The agreement must be in writing and include a clause stating the intent for legal enforceability. Affected employees are required to adhere to the terms of the agreement, which may then be incorporated into individual employment contracts, either explicitly or implicitly.
And if an agreement is not reached?
The simple answer is nothing changes. A failure to reach an agreement can create significant workplace tension. In some cases, mediation or arbitration can be sought to help resolve the dispute, but without mutual agreement, no legally binding terms can be established.
Finally
Collective bargaining does have a vital role to play in the current business landscape, which can be complex and change quickly as a result of technological advancements and evolving consumer expectations.
Against such a backdrop collective bargaining can give employees a unified voice in negotiations, and in working to ensure any significant workplace changes do not have a negative impact on a workforce.
Understanding how collective bargaining works and the impact on both union and non-union members is essential in the modern workplace.
