A collective bargaining agreement collectively sets the terms on which an employer offers individual work contracts to each of its employees in the bargaining unit. A bargaining agreement, also herein referred to as a labor agreement, is a legally enforceable written commitment, which states the rights and duties of all parties involved. The labor agreement should be made in good faith and is intended to be observed and not violated.
The National Labor Relations Act obligates employers and unions to bargain in good faith concerning terms and conditions of employment, including hours and wages. Like any normal contract, competent parties must enter into a labor agreement. However, a labor agreement is unique from other legal contracts in that there is no consideration involved and nothing tangible is exchanged. Many, but not all, unions require formal ratification of a new labor contract by a majority membership acceptance, which is determined through vote by the members.
Until majority approval of those voting in a ratification election is received, the proposed labor contract is not final. While each labor agreement is unique to the needs of an organization and its employees, most agreements include five issues: (1) Management Rights, (2) Union Security, (3) Wages and Benefits, (4) Individual Security (Seniority) Rights, and (5) Dispute Resolution.
