Most broadly, this term can refer to any negotiation where a group of people have chosen a representative or representatives to bargain with an individual or another group, with the results to be binding on all, perhaps requiring ratification by the group as a whole.

Commonly this term is used to refer to labor union negotiations with a corporation, an individual employer, or the government. Usually the final goal is a written contract acceptable to both parties.

The tools available to each party to put pressure on the other vary according to the industry and situation. Employers are forbidden for penalizing employees simply for being in a union, but may claim they cannot afford to accept the employees demands and will cease operations if the damands are not moderate. The Taylor Law makes it illegal for government employees to strike, but other unions may collectively cease work and discourage others from taking their places by legal means - or occasionally illegal means. Often a company will find ways to discourage union membership that cannot be proven in court.

A collective bargaining agreement is a work contract that is developed by union and employer representatives. Collective bargaining agreements are often sought to end worker disputes and/or strikes, but they are also renegotiated on a periodic basis; depending on the agreement, work contracts expire after a certain amount of time, requiring a new contract to be agreed upon every few years or so.

Collective bargaining agreements constitute an employer/worker agreement on issues such as wages, fringe benefits, working conditions (e.g. employee safety), training opportunities, and pretty much anything else a worker and an employer could agree (or disagree) about. Bargaining agreements are hammered out by skilled negotiators from both sides, after which union representatives present the proposed contract to the bargaining unit, who must either vote to accept or reject the agreement.

The concept of a collective bargaining agreement is fairly simple: the employer agrees to certain concessions (e.g. a pay raise and a better pension plan) in exchange for the union agreeing not to stage strikes, walkouts, work stoppages, or other disruptions. In essence, both sides agree to play nice so long as each promises to hold up their end of the deal.

In working with employers and unions to create a mutually beneficial collective bargaining agreements (and in protecting the spirit of the National Labor Relations Act), the National Labor Relations Board often uses its judicial clout to encourage "good faith bargaining," which it defines in section 8(d)of the NLRA as:

To bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or the negotiation of an agreement or any question arising thereunder, and the execution of a written contract incorporating any agreement reached if requested by either party, but such obligation does not compel either party to agree to a proposal or require the making of a concession...
Basically speaking, corporate representatives and union representatives get together in a conference room (usually at a neutral location, such as a local hotel), order up a few pots of coffee, and argue back and forth about what the employees need/want and what the business can afford to give them. This process can take hours, days, or even weeks, but unless the union really wants to strike (or unless the company wishes to bust the union), the negotiators will find common ground and produce a mutually acceptable work contract before the preset deadline.

If the employees in the bargaining unit vote to accept this new contract, they will work under the agreement for a number of years until it expires, after which the process begins anew. If the bargaining unit rejects the new contract, then it's back to the drawing board; corporate and union representatives return to their posts and begin rehashing the finer parts of the contract in the hopes of averting a strike.

Sometimes (though not often), the bargaining unit will reject multiple contracts, requiring that negotiations drag on and on indefinitely. This is usually a strong sign that the union members consider their leadership "out of touch" with their needs and desires; it also often signals an impending change of leadership in the next union election.

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