Collective Wage Agreements
A collective wage agreement is a negotiated arrangement between an employer and employees on wages. Generally, such an agreement comes about through collective bargaining, in which management works with employees on determining conditions of employment.
Other People Are Reading
-
Significance
-
For an employee, a wage agreement clarifies what pay he will receive. For the employer, wages play a major role in determining her labor costs. A collective wage agreement enables the employer and the employee to anticipate pay levels, which benefits both parties.
Negotiations
-
In the United States, the National Labor Relations Act provides for employees to bargain collectively through a chosen representative, usually a trade union. The NLRA also lists wages as one of the required subjects when bargaining takes place. It does not compel management or unions to accept offers or reach compromises.
-
Considerations
-
When negotiating collective wage agreements, keep certain legal restrictions in mind. Review relevant state and federal laws, such as minimum wage laws specifying the lowest wage employers can legally pay employees.
Misconceptions
-
Violations in collective wage agreements can lead to legal action or strikes, but not always. In the course of negotiating the agreement, employers and employees might agree to an arbitration clause, in which an independent person or group acts as the arbitrator in future wage disputes. The two sides may also agree to a clause banning strikes as long as the wage agreement is in place.
-
References
Resources
- Photo Credit dispute for the money image by ktsdesign from Fotolia.com
