Legal 101

An introduction to collective agreements

Amber AkhtarAmber Akhtar
Last updated on:
June 29, 2022
Published on:
June 29, 2022

Read our guide to employment agreements

Read the Guide

Many employment contracts refer to collective agreements, but what actually is a collective agreement?

What is a collective agreement?

A collective agreement is entered into between an employer and a trade union. A trade union is an organisation which consists of groups of employees who come together to maintain and improve conditions of employment, for example by collectively bargaining for better pay and conditions for all workers, political campaigning and industrial action. The key legislation of importance are the Trade Union and Labour Relations (Consolidation) Act 1992 (‘TULRCA’) and the Trade Union Act 2016 . An employer may have an agreement with the employees’ representatives from a trade union or staff association, which allows the negotiation of terms and conditions affecting the employee's contract like pay or working hours, otherwise known as a collective agreement. The terms of such an agreement include:

  • How negotiations will be organised;
  • Who will represent the employees;
  • Which employees are covered by the agreement; and
  • Which terms and conditions the agreement will cover

What are Trade Union Representatives?

Trade unions have representatives situated in the workplace and their role includes:

  • Negotiating agreements with employers on pay and conditions;
  • Discussing changes such as redundancy;
  • Discussing members’ concerns with employers;
  • Accompanying members to disciplinary and grievance meetings; and
  • Assisting members with legal or financial problems

What is Collective Bargaining?

Collective bargaining is only possible when an employer recognises a trade union and they have decided on the scope and process of negotiations, this can be either voluntary or through ‘statutory recognition’ which is stipulated through law, is legally binding and allows unions to make employers recognise them when enough workers become union members and support union recognition.

Collective bargaining is the process in which trade unions negotiate with employers on behalf of their members. When a trade union is recognised in a workplace, the negotiations that they have with the employer are known as “collective bargaining”, which are negotiations regarding the terms and conditions of employment. They will need to agree on:

  • Who represents the worker, or workers’ (bargaining unit);
  • Which workers are included in the bargaining unit;
  • How often meetings take place;
  • Which issues will be discussed;
  • How failures to agree will be resolved; and
  • How discussions will work if there are multiple organisations involved.

Once a collective agreement has been agreed by the employer, the decision is legally enforceable and implemented into the employees contracts/worker's contract.

Where a decision cannot be reached through negotiations between the employee, workers and their employers, they may need to resort to dispute resolution. Collective disputes between employers and their workforce or a trade union are normally resolved through dispute procedures. Strikes and industrial action are normally the last resort. All parties must know the parameters of what they can and can’t do when in dispute.

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How do collective agreements affect Rail, Tube and Airport Strikes?

Last week travel across the UK was disrupted as the Rail, Maritime and Transport (RMT) union launched a three day strike to impact the British rail network. This comes after years of failed negotiations and collective bargaining with railway operators. As it stands, more rail strikes may be likely if talks between rail bosses and unions continue to fail. But why is there a strike?

In May, members of the RMT union voted on industrial action, 89% of the members who responded in the ballot were in favour of the strikes. The employees work across Network Rail and 13 individual train operators which include catering staff, guards, engineering workers and signalling staff.

The RMT union is protesting against government cuts, poor working conditions and unsatisfactory pay rises against rising inflation. It was said the source of the disputes has been the decision by the Tory government to cut £4bn of funding from transport systems, £2bn from National Rail and £2bn from Transport for London. As a result of this decision, the employers have decided to make thousands of job cuts, reducing pay or subjecting employees to lengthy pay freezes and cutting benefits/making staff work longer hours. The RMT is preparing more strikes after failing to reach an agreement with the Network Rail and UK train operators.

The Transport and Salaried Staffs’ Association (TSSA) who represent non-driving rail workers also served notice of an industrial action ballot on 9 June, which means workers for Avanti West Coast could strike over pay, conditions and job security.

In addition, British Airways ground-handling staff who are members of the Unite Union have votes 95 percent in favour of a strike unless British Airways reverses the 10 percent wage cut made during the Covid-19 pandemic.

There are a number of additional strikes pending which include Aslef train and tram strikes, London Underground tube strikes and Yorkshire and London Bus strikes.

Many rights we are able to enjoy today would not have been possible without the workers who joined trade unions.

What impact have Unions had on Society?

Unions have made significant changes to society which include:

Collective Agreements and Employment Contracts

A collective agreement may be implied or expressly incorporated into an employment contract. Those that are expressly incorporated must reference the collective agreement in the employment contract alongside stating the terms in the employment contract which may be changed in the event there is a variation to the collective agreement.  

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