
INTRODUCTION
Trade unions and Collective Bargaining Agreements (CBAs) constitute the bedrock of industrial relations, ensuring that the interests of employees are adequately represented in negotiations with employers. In India, trade unions act as collective representatives of workers, engaging in structured negotiations to establish legally enforceable agreements on wages, working conditions, and other employment-related matters.
The role of trade unions In shaping labour relations has been pivotal in the evolution of employment law in India. As collective entities representing the workforce, trade unions facilitate structured dialogue between employees and employers, ensuring that labour rights are upheld while maintaining industrial harmony. One of the primary tools available to trade unions in achieving these objectives is collective bargaining, a process through which labour conditions, wages, and other employment benefits are negotiated and formalized in agreements that bind both parties .
The necessity of trade unions and collective bargaining is underscored by the inherent power imbalance in employer-employee relationships. While employers have the capacity to dictate terms of employment, collective bargaining enables employees, through trade unions, to negotiate better working conditions and legal protections.
In India, the legal recognition of trade unions and the enforcement of CBAs are governed by multiple statutes, including the Trade Unions Act, 1926, the Industrial Disputes Act, 1947, and the Code on Industrial Relations, 2020 .
Despite being an essential feature of labour law, trade union activity and collective bargaining in India face numerous challenges, including declining membership, legislative restrictions, and the rise of alternative work arrangements such as gig and contract-based employment.
LEGAL FRAMEWORK
The Trade Unions Act, 1926
The Trade Unions Act, 1926, provides the statutory foundation for the formation, registration, and functioning of trade unions in India. The Act defines a trade union as any combination of workers or employers formed to regulate employment relations. It mandates a minimum of seven members for registration, granting legal recognition and statutory protections.
The Industrial Disputes Act, 1947
The Industrial Disputes Act, 1947, governs the resolution of industrial disputes and recognizes the role of trade unions in collective bargaining.
Code on Industrial Relations, 2020
Though yet to be implemented, the Code on Industrial Relations, 2020, consolidates existing labour laws and introduces key reforms affecting trade unions and CBAs. It introduces the concept of a negotiating union/bargaining agent, requiring employers to engage with the union having at least 51% membership in an establishment. It also standardizes the process for collective bargaining, ensuring clarity in employer-employee negotiations and imposes conditions on legal strikes, including mandatory notice periods and mediation requirements.
INTERDEPENDENCE OF TRADE UNIONS AND COLLECTIVE BARGAINING AGREEMENTS
Trade unions serve as the primary vehicle for collective bargaining, and negotiating CBAs that define employment conditions. Their functions in this regard include :
- Representation in Negotiations
- Legally Binding Agreements
- Dispute Prevention and Industrial Harmony
- Fragmentation of Trade Unions
- Declining Union Membership
- Regulatory Restrictions on Strikes
- Technological and Structural Shifts in Employment
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