Collective Bargaining 101

What is collective bargaining?

Collective bargaining is a process that enables employers (represented by their employers’ organisations) and employees (represented by their trade unions) to reach an agreement about salaries or wages and working conditions. The platform where these negotiations take place are called “bargaining councils” and for every industry, there is a different bargaining council, and because certain bargaining councils only have jurisdiction in specific geographical areas, there may be more than one bargaining
council per industry.


These bargaining councils, as bodies, as well as the two main parties that are involved in the negotiation process, namely the trade unions and employers’ organisations, must be formally registered with the Department of Employment and Labour (DEL), and operate within the relevant legal parameters.

When does a collective agreement become legally binding?

As soon as a collective agreement is signed by all parties involved, it is sent to Minister of Labour, who must then extend the collective agreement by publishing a notice in the Government Gazette, within 60 days of receiving the request. This must be accompanied
by a declaration that specifies for which period the collective will be legally binding.

Typically, collective agreements are in place for a period of three to four years, and upon expiry of this period, the terms are renegotiated. Whilst waiting for a new collective agreement to be gazetted, the terms of the current one remains in place.

Who are bound by a collective agreement?

The moment a collective agreement in any industry becomes legally bound, it applies to all employers in that industry, or within the relevant geographical area, regardless of whether they participated in the collective bargaining process or not, or whether they were a “non-party” to the bargaining council or not.


By law, the onus is furthermore on the employer to determine which industry the business falls in, and which collective agreement informs their terms and conditions for employment, which is why all employers or their dedicated labour relation(s) practitioners should always be well-informed on the terms of the latest collective agreement that pertains to their industry

The role of each party in collective bargaining.

The purpose of the bargaining council is basically to facilitate labour-related negotiations between employers’ organisations and unions, solve labour disputes, establish various employee incentive schemes and comment on labour-related policies and laws. The purpose of the employers’ organisation is to represent or advance the interest of employers or groups of employers in matters pertaining to employment. Similarly, the purpose of the trade union is to represent or advance the interest of employees or groups of employees in these matters.

As soon as all parties have come to an agreement about the salaries or wages and working conditions, the details of the agreement are stipulated in a contract, which for the purposes
of collective bargaining, is referred to as a “collective agreement”.

How to get a seat at the labour decision-making table.

Simply put, if you are an employee, and you want a seat at this decision-making table, you need to join a legally registered trade union, who needs to apply to get a seat at your industry’s bargaining council, on your behalf. Similarly, employers who wish to have their voices heard, must join a legally registered employers’ organisation. After all, you cannot sit on the side line and criticise the rules of the labour game, if you are not in the labour game.

For more than 22 years, the (SA)UEO has been trusted to represent employers in South African industries across the board and promote their interest in a manner that is as fair as possible to all parties involved.


For more info, visit