Prior to the writing of this article, I undertook a random survey of general knowledge of HRM practitioners on their understanding of the difference between a Collective Agreement and a Collective Bargaining Agreement. In most cases, they referred to a Collective Agreement as a Collective Bargaining Agreement. Most couldn’t tell the difference and believed it was one and the same thing.
Another is the difference between Collective Bargaining Certificate and Union Certificate. Most HRM Practitioners may not be able to tell the difference between the two. There are three stages of the union formation process. The first is registration as a body corporate with the Registrar Generals Department of Ghana to obtain certification to operate as a union if the Republic, The second is application to and registration with the Chief Labour Officer for a Union Certificate and then the third is application to obtain certification to collectively bargain for a class of identified workers who have been unionized (organized).
So we will try to explain what a Collective Agreement is as against a Collective Bargaining Agreement. Then we will look closely at the content of such Agreements. Most importantly, we hope to be able to replay typical labour-management negotiations leading to the signing of a Collective Agreement. In the end, I hope that we can understand the dynamics of such negotiations and the specific Agreements that emanate from such negotiations.
Imminence of Unionization
A decade ago, I said categorically that all organizations should brace themselves for the unionization revolution because a union will come knocking on their doors at some point in the near and present future. And that they better be ready when the unions come knocking because in many cases, there will be no stopping them.
This statement still holds and indeed, some organizations have experienced first-hand what it means for a union to come knocking on the door and truly there’s often no stopping them. For the above reasons, it is important for human resource management practitioners and business leaders to equip themselves with the necessary knowledge in labour union regulation to enable them engage effectively when the unions turn up.
Unions are cross-unionizing everything and anything that has a semblance of a salary earning individual. The competition is so intense that most often, unions cut corners in unionizing workers. For a ‘weak’ management, some unions will bully and intimidate their way into the organization and forcibly extract conditions capable of sinking the organization. Some unions however are a blessing in disguise and represent that ‘steady voice of counsel’ or a helpful check that guides management action for enhanced productivity.
What is A Collective Agreement?
Austin Akuffo Gamey, an accomplished Labour and ADR Consultant and the CEO of Gamey and Gamey Group defines Collective Bargaining as “A genuine process to negotiate in good faith collectively on issues to regulate terms and conditions of employment, non-employment and work, including remuneration, dispute resolution mechanisms and other benefits, based on brainstorming and consensus, which must be owned jointly by the social partners for implementation.”
A Collective Agreement is a document containing the concluded terms and conditions of work as well as all cash and non-cash benefits that accrue to a unionized worker in a job position. The document is indeed an agreement bargained, concluded and signed by the representatives of workers (the Union) on the one hand and Management of the organization or company. The agreement which normally remains effective for at least a year is renegotiated upon expiration. However, if no party to the Collective Agreement notifies the other of the intention to renegotiate parts or all of the agreement, the agreement remains effective and in force until it is renegotiated
The initial draft of the Collective Agreement which is negotiated by the parties is called the Collective Bargaining Agreement. I am not sure why it is called a Bargaining Agreement when indeed there is no agreement yet of all the terms in the document under negotiations. Perhaps, and I am convinced of this, that it may be called as such because it emanates from an initial agreement by the parties to draft and jointly deliberate on various terms and conditions of work as well as employee benefits that should govern and regulate the employment relationship between Labour and Management. So there is a Collective Bargaining Agreement which is a draft document, negotiated and agreed as a binding workplace regulation and referred to as the Collective Agreement. It is only when negotiations are over and the Collective Bargaining Agreement signed and sealed (approved) by each party to the negotiations can such a document be called a Collective Agreement.
On the other hand, in the absence of a Union in the workplace, the regulatory document which is implemented in place of a Collective Agreement is referred to as the Conditions of Service. The contents of a Conditions of Service Document are not too different from that of a Collective Agreement. The only prominent difference is that a Collective Agreement is a negotiated document and has the high input of workers while in traditional Conditions of Employment documents, there is hardly any employee input. A Condition of Service is a management regulatory tool that binds employees to a particular behaviour, conduct and earned remuneration and rewards.
Composition of a Collective Agreement
The Labour Act, 2003 (Act 651) a.k.a. The Labour Law makes some suggestions of necessary areas, provisions or matters that “may” be included in the design or crafting of Collective Agreements. The first is the class and categories of workers to which the Collective Agreement applies. Now this is a very important aspect of every Collective Agreement because being a binding document, its scope of application must be well defined to avert future issues of disagreements on scope and application of the Collective Agreement.
The second is the Conditions of Work including the hours of work, rest periods, meal breaks, annual leave, and occupational health and safety measures. I have always maintained that hours of work in a workplace is as important as pay because employers essentially pay for a qualified employee’s time and nothing else. The current and applicable Labour Law makes the health of an employee the liability of his or her employer on and off the job. Hence it is most important that the binding Collective Agreement hold the employer to the duty of healthcare to its employees.
Third, the Remuneration and the method of calculating the remuneration of the workers are expected to be included in every Collective Agreement. Very interesting provision but important as well. Remuneration is defined as ‘the basic or minimum wage or salary and any other additional emoluments payable directly or indirectly by an employer to the worker on account of the worker’s employment”. Most often, remuneration is easily agreed but even that sometimes result in many differences and disputes. Now, we are expected to also agree on the method of calculating such remuneration. I must hurry to add that it is also important to agree and include the terms and frequency of payment of salary or pay in the Collective agreements.
These details are important because most employment disagreements emanate from disagreements on salaries, pay, quantum or terms of payment or even frequency of payment or non-payment. Hence, it is important to ensure that all these are clearly outlined and agreed as regulations in the Collective Agreement.
Fourth is the period of probation and the conditions of probation. Interestingly, this is the only aspect of the Labour Law where probation is mentioned. In the Labour Regulations of 2007 (LI 1833), regulation 5 makes a cursory and limited mention of probation and directs for contracts of employment to state the duration of probation where probation is a condition of employment. Now due to the limited provisions for probation in the statutory Labour Law and Regulations, it is important to specify the provisions of probation for employees in the Collective Agreement. Mandatory probation for all employees, duration of probation and the period of notice for termination of employment during probation are some of the most basic probation provisions that may be outlined. Then details such as employee performance monitoring and evaluation through appraisals and employee behaviour management could be included as well. Probation is the last option available to an employer to make the right hiring decision.
Fifth is the period of notice of termination of employment, transfer and discipline. Employers seem not to have a problem with regulating period of notice for termination of employment where one (1) month notice is required for employment for more than three (3) years, two (2) weeks’ notice for employment for less than three (3) years and so on. Notice for transfers is also not too much of a problem. However, there is a big problem with giving notice for discipline of employees. When it comes to discipline, it is known that many employers are yet to comply
with regulations at Law. Hence, it is important for the inclusion of specific disciplinary steps including notice for discipline in the Collective Agreement.
Sixth is the procedure for the avoidance and settlement of disputes arising out of the interpretation, application and administration of the agreement which in this case is the Collective Agreement. An agreement is bound to be breached in one form or the other. Hence, if there are no prior agreed methods and procedures to resolve such breaches or disagreements, there is bound to be constant upheaval in the implementation or application of the Collective Agreement. Indeed, the Labour Law requires that all employers and their workers include in the Collective Agreement provisions for the final and conclusive settlement of all disagreements that may arise in the course of the employment relationship.
Seventh are the principles for matching remuneration with productivity. This refers to the provision of policies for rewarding performance. Where pay for performance methods are executed in the workplace, they must be in accordance with negotiated outcomes regulating the terms of such pay for performance rewards. Negotiations are important in this instance because processes of reward must always ensure visible equity if peace is to reign in the workplace or organization. Hence, these must be agreed and included in a Collective Agreement which is binding on both the workers and management.
Last but not the least is to include the essential services within the establishment in the Collective Agreement. According to the Labour Law, workers or organizations classified as essential services shall not participate in any industrial or strike actions. Essential Services organizations as prescribed by the Labour Regulations include Water Supply Services, Electricity Services, Health, Hospital and Sanitary Services, Air Traffic Control, Meteorological and Fire Services etc. Hence, it is important to identify, agree and include in the Collective Agreement sections or departments of the company labelled as essential services. When this is done, it will mean that those identified sections of employees shall be bound per the Collective Agreement not to embark on industrial strike actions. Specific methods of resolving their grievances are stipulated for implementation.
When workers and management decide to agree on specific terms and conditions of employment, these terms are discussed at length to reach an agreement on each of the identified terms and conditions. The process of making offers and counter offers until an amicable agreement is reached on each of the stated and identified conditions and terms of work is known as Collective Negotiations. It is also called collective because it may involve several if not all employees in the workplace and such negotiations are held collectively on behalf of all the employees by their representative Union.
In typical Collective Negotiations, the Union or Management give each other notice of their intention to negotiate part or all of a Collective Bargaining Agreement (if it is the first) or Collective Agreement if it is already negotiated and expired or about to expire. The notifying party attaches proposals of changes to existing provisions to the other party, inviting the other party to negotiate on a proposed date and venue. The party who receives the notice responds and agrees on the proposed date or any other suitable date.
Each party then goes into individual strategy sessions to plan and work on proposals on the table in readiness for the negotiations. On the appointed date, the parties meet at what is called the bargaining table to discuss proposals tendered. Discussions (negotiations) are held on each proposal until agreements are reached. This normally takes a few days to several months depending on the circumstances and parties involved in the negotiations. The Agreement is signed upon conclusion of the negotiations by representatives of each of the parties to the negotiations.
A new Collective Agreement is then said to have been BORN!!!!