We are often approached by businesses unsure of what to do when a union initiates bargaining for a collective agreement. It’s a common challenge and one that comes with legal obligations and procedural complexities that can feel overwhelming.
What is Collective Bargaining?
Collective bargaining is the process where an employer and a registered union negotiate the terms and conditions of employment on behalf of your employees who are union members. The union's desired outcome of these negotiations is a collective agreement, which sets out employment conditions such as wages, leave entitlements, dispute resolution processes, and workplace policies.
In New Zealand, the Employment Relations Act 2000 governs collective bargaining and places significant emphasis on good faith bargaining. This means that both parties, employers and unions, must engage honestly, openly, and constructively throughout the process.
Key obligations for employers
If a union initiates collective bargaining, employers have legal obligations they must adhere to. These include:
- Engaging in good faith: this means both parties must be active and constructive in bargaining, avoiding misleading or deceptive conduct. Employers cannot refuse to bargain if a union represents employees covered by the proposed agreement.
- Providing necessary information: employers must supply relevant information during negotiations if requested to do so, such as wage data or financial reasoning behind proposals. This ensures transparency in the process.
- Not undermining the union: employers cannot take actions that might be seen as discouraging employees from supporting the union or from engaging in collective bargaining.
- Following the process properly: if bargaining reaches a deadlock, there are legal steps that must be followed, including mediation or potential recourse to the Employment Relations Authority (ERA) for resolution.
Failing to meet these obligations can lead to legal challenges, penalties, or industrial action, making it critical to approach bargaining with the right strategy and understanding.
Challenges employers often face
Many businesses in New Zealand find collective bargaining challenging for several reasons:
- Limited experience: If a business hasn’t gone through collective bargaining before, knowing where to start or what to expect can be daunting.
- Balancing business needs with employee expectations: Employers want to remain competitive and financially sustainable, while employees and unions seek improved wages and conditions. Finding common ground can be difficult.
- Managing the process effectively: Bargaining can take weeks or even months, requiring careful planning, strategy, and negotiation skills.
How Intepeople can help
This is where expert guidance makes all the difference. With extensive experience in collective bargaining, the Intepeople team can support your business by:
- Clarifying your legal obligations and ensuring compliance with employment law
- Developing a clear negotiation strategy that aligns with your business goals
- Providing expert advice and representation throughout the bargaining process
- Helping you maintain positive relationships with employees and unions while securing a fair and sustainable agreement
We understand that every organisation is unique, and we tailor our approach to align with your business needs, culture, and goals.
Need support? Let’s talk
If your business is facing collective bargaining for the first time, or if you want to ensure you’re on the right track, please reach out to us. With the right expertise on your side, you can approach negotiations with confidence, knowing you have the support to achieve a positive and legally sound outcome.
📞 Get in touch with Marianne Wilkinson, Intepeople ER Partner.