CHAPTER Seven

COLLECTIVE LABOUR RELATIONS

7.1. The Right to form Organization
The importance of anchoring legal recognition for the right to form organization in the
employment arena is not doubtful now throughout the world. Indeed, both workers and employers
should be given the right to form their own organizations to promote their social and economic
interest as well as to defend any moves detrimental to their occupational interest. As part and parcel
of the fundamental right of freedom of association, the right to form industrial organizations is
widely recognized today as one of the pillars and expressions of a sound labour relations policy.
In today’s modern economic order unorganized workers or employers would, no doubt, have a
limited capability to enforce their rights or defend their interest. Today, many agree that there can
be no permanent prosperity to the workingmen, there can be no industrial peace, unless and until
the principle is firmly and fully established that in industrial life the settlement of wages, hours of
labour, and all the important conditions of work, are made between the employers and the workers
collectively and not between employers and workers individually.
The individual worker theoretically bargains with his employer as to the wages to be paid by his
employer; but practically there is no bargaining. The individual worker must accept the wages and
conditions of employment that are offered to him by his employer. It is a matter of no concern at
all to an employer if one workingman refuses employment. The employer thinks nothing about it,
because there is another workingman ready to take the job. As a consequence of this system of
individual bargaining, which is really non-unionism, the conditions of the best persons in the
industry are brought down, practically, to a level with those of the weakest workers in the industry.
However, the idea of a group of people associating for mutual protection and benefit in relation to
employment had come under severe attack from every quarter in the history of mankind, though it
is a common enough one today. After long years of struggle and challenges, it was the Industrial
Revolution that gave birth, in particular to trade unions as we know them today. It was not without
challenge, even then after, that the idea of trade unionism acquires its current status worldwide.
The major legal obstruction to unions during the early part of the nineteenth century was that, as
their main purpose was to improve the working conditions of their members, they were seen to be
in restraint of trade and therefore, considered to be illegal if they performed this function.
Forming industrial organization is vital to both the workers and employers for effective realization
of their legally recognized rights and interests. Acting collectively by forming organizations is thus
not a mere privilege but also a precondition attached to both the workers and employers to put
pressure on or influence one another, and thereby promote and protect their respective rights and
benefits. This is mainly due to the very fact that industrial organizations provide a great deal of
advantage not only to the workers and employers but also to a state, as a guardian of its subjects,
by creating a fertile ground for peaceful labour disputes resolution process. Effective resolution of
labour disputes is closely linked to promotion of the right to collective bargaining.
As will be discussed later on, collective bargaining, on the other hand, presupposes the existence
of organizations in general and trade unions in particular. In other words, in order to have a
collective bargaining the formation or existence of trade union is a necessary prerequisite. That is
why, of course, forming industrial organization is said to be not a mere privilege but a precondition
for effective protection and implementation of the rights of both parties in the labour relations.
Despite the tremendous benefits organizations would provide for both the workers and employers,
the right to form organization ages only few decades since it acquires legal recognition under
Ethiopian law. It was only upon the coming into effect of the 1955 revised constitution that we
came to see a legal provision on freedom of association. Nonetheless, it was after eight years that
a proclamation containing detail matters on this core right of workers was enacted in 1963 in
support of the constitutional sanctity of freedom of association.
Currently, there are a number of legal provisions that recognize this core right of workers and
employers under our laws. For instance, article 31 and 42 of the FDRE constitution, article 113 of
the present labour proclamation expressly recognize the right of workers and employers to form
their own respective organizations. In addition, you can find a large number of provisions from
international instruments adopted and ratified by Ethiopia such as the ILO convention 11,
convention 87 and convention 98 which directly refer to the rights of workers and employers to
form industrial organizations. The provisions under those international instruments apply not only
to workers and employers in the industrial sector but also to civil servants and workingmen, as a
class, in other sectors, too.
When we talk about the right to form organization we are not referring to a single right; rather it
is a bundle of rights which include the rights of workers and employers to form their own
organizations without the interference or influence of any third party, to prepare their own
constitutions that govern their respective organizations, to choose the leaders of their organizations
freely and fairly, to formulate and design the programmes and objectives of their organization, and
so on. However, the right to form organization is not an “exclusive right” in a sense that it cannot
be realized without preconditions. Just like many other collective legal rights, the right to form
organization presupposes the fulfillment of various requirements, for its effective realization.
For instance, in order to form a trade union sustainable in the eyes of the law, workers are expected
to fulfill the following preconditions or requirements:
i. minimum number of members;
ii. Constitution; and
iii. Registration with the Ministry of Labour and Social Affairs
Accordingly, in order to form a trade union, workers must make sure that they satisfy the minimum
number of members required by the law. As per article 114(1) of the labour proclamation, a trade
union may be established in an undertaking where the number of workers is ten or more. According
to this provision the minimum number of workers required to form a trade union is ten. The number
of members of the union shall not be less than ten.
However, workers should be given greater opportunity to form organization, and the legislative
drafter must endeavor to reduce, as much as possible, any obstacles that may dwarf this
opportunity. Taking this fact into account, the law has tried to come up with another alternative
whereby workers who work in undertakings which have less than ten workers may form a union.
As provided under article 114(2) of the proclamation, workers who work in undertakings which
have less than ten workers can form a general trade union.
General trade union is simply a type of trade union which workers of two or more different
undertakings may jointly form. But, at any rate the number of members of such a union which is
to be formed by workers of more than one undertaking shall not be less than ten. For example; let
us say that the number of workers in undertaking “A” is five, while the number of workers in
undertaking “B” is four.
As can be understood from the above discussion it is obvious that neither workers of undertaking
“A” nor that of “B” may independently form their own trade union. This is because the number of
workers in each of these two undertakings is less than ten. Similarly, workers of both undertaking
“A” and “B” may not even jointly form a general trade union, unless they call for additional
workers from another undertaking to join them. Because, the sum of the number of workers of
undertaking “A” and undertaking “B” is still remain less than ten.
Having a constitution is the other requirement for the formation of a trade union. Workers who
agree to form a trade union must prepare and submit the constitution of the union to the Ministry
of Labour and Social Affairs. A constitution in this context can be defined as a written document
in which the objectives of the union and the rights & duties of its members as well as their
relationship with the union are embodied. The constitution governs the powers / functions/ and
duties of the leaders of the union, the rights and duties of the members as well as their relationship
with the union, and so on. In addition, what a constitution may also contain is listed under article
117 of the Labour proclamation. Thus, preparing a constitution that contains such matters is the
other precondition to form a trade union.
Registration is the last essential requirement to form legally recognized trade union. After fulfilling
the above two conditions the “union” must get registered with the Ministry of Labour and Social
Affairs if it is sought to perform the desired activities or discharge functions sustainable in the eyes
of the law. Accordingly, in order to form legally recognized trade union workers who have agreed
to form a union need to submit their application to the ministry together with the necessary
documents such as the constitution. Workers who satisfied the above two requirements (i.e.
constitution and the minimum number - - -) would normally accepted by the ministry and get
registered without challenge. The ministry may, however, refuse to register a union for certain
reasons. The grounds of refusal for registration are provided under article 119 of the proclamation.
Therefore, the ministry may refuse to register a trade union or employers’ organization for any one
of the reasons provided under this provision.
Nonetheless, according to article 118(1) of the proclamation the ministry shall, after examining
the documents and ascertaining that they are duly completed, issue a certificate of registration
within fifteen (15) days of receiving the application. Where the Ministry does not notify its
decision within this period, the organization shall be deemed registered. Once a trade union or
employers’ organization get registered it shall have legal personality and as such it will have the
capacity to perform juridical acts in its own name, in particular capacities such as to enter into
contract, to sue or be sued, to own, use and transfer property, and so on.
So far, we have seen three major requirements for the formation of a trade union in particular.
Except the first requirement that applies to trade unions only, the other two requirements apply to
both trade unions and employers’ organization. This is to mean that preparation of a constitution
and registration are also the necessary preconditions to form legally recognized employers’
organization.
Unlike the case for trade unions, the law is silent as to the minimum number of members required
to form employers’ organization. Therefore, in the absence of any clear provision to this effect, it
is sympathetic to say that employers’ organization can be formed so long as the number of
employers who agree to form organization is not less than two.
To sum up, the requirements or preconditions necessary for the formation of a trade union or
employers’ organization are more or less the same, except, of course, the one that requires the
minimum number of workers to form a trade union. In general, both workers and employers can
form their own respective organizations after fulfilling the requirements discussed above. trade
unions and employers’ organizations are types of industrial organizations that could be formed at
the grass-root level.
In addition to these, there are industrial organizations such as “federations” and confederations”
that could be formed at a vertical level. In order to strengthen the unity and spirit of co-operation
of their members, more than one trade unions may jointly for “trade unions federation”. Likewise,
several employers’ organizations may jointly form “employers’ federations”. Similarly, more than
one federations of trade unions may come together to form a trade unions confederation, and more
than one federations of employers may jointly form employers confederation. Confederations are
the upper level industrial organizations. Nonetheless, the law is silent as to whether trade unions
federations and employers’ federations can have more than one confederation of their own. But,
practically there is only one confederation (i.e. Confederation of Ethiopian Trade Unions, CETU)
and few federations, so far, in the country.

7.2 Trade Unions and the rights of workers

Though the formation of trade unions is vital for every aspect of labour relations, you must note
the fact that a trade union has to be formed with the free and full consent of workers without any
influence or interference from any quarter. This fundamental right includes the freedom of worker
to join any of the trade unions they like, or not to join a certain trade union, or even to withdraw
themselves from the membership of a trade union at any time they wish.
As a result, no one, even the employer or the trade unions themselves, can force any worker to join
a certain trade union or to withdraw from the membership of a trade union. Any acts that aimed,
directly or indirectly, at forcing a worker to join or not join, or to withdraw from a trade union is
taken to be illegal. For instance, any activity of the employer that, directly or indirectly, forces a
worker is clearly prohibited under article 14 (1) (a) of the Labour proclamation. In many countries
there are certain kinds of associations or practices such as yellow dog, closed shop, unions shop
and Agency Shop which indirectly force workers to join trade unions. Such systems or associations
are there, often, to provide especial benefit to its members only as well as to help employers by
avoiding strike. In such systems, though non-member workers are not directly obliged to join such
unions, they are forced to pay fees that used to run the activities of the unions. Such practices, in
general, would have the effect of, though it is indirect, forcing a worker to join one of the unions.
However, this is a sort of unionism widely practiced in other countries. It is uncommon to observe
such sort of unionism under Ethiopian law. The legality of practices that may put pressure on
workers freedom, or activities where by the employer would make any discrimination among
workers based on membership to a trade union by providing special benefits to members of a trade
union is questionable under Ethiopian law.
A similar problem may, of course, occur in relation to implementing collective agreement and/or
collective bargaining. Collective bargaining in short, is a process through which some
representatives of the working class (often leaders of trade unions) negotiate with the employer
regarding matters on wages, working hours, and other important conditions of work. And the effort
to reach on an agreement on such matters inevitably demands both parties to incur transaction
costs in terms of time, labour, money and the like. But, once the agreement is signed, after parties
have reached on agreement, the agreement will apply to all workers without due regard to workers
membership to a trade union.
The agreement shall, by no means, be made applicable to some workers only who are members to
a trade union, by excluding non-member workers. Thus, any activity or attempt of either the
employer or trade unions, be it overt or covert, that aims at making a discrimination among non-
member workers and members to a trade union would be contrary to the provisions of the
constitution or other international and domestic legislations. But, in such conditions there may be
a problem as to the question that who shall cover the transaction costs incurred to bring the
collective agreement?
On the workers side, the cost is, often, to be covered by the trade union from the income collected
from its members in a form of membership fees. If that is the case, making the collective agreement
applicable to all workers would, perhaps, amount to giving undue advantage to non-member
workers at the expense of members to the trade union who are paying membership fees. So,
according to some writers the solution to such a problem is making all workers (including non-
member workers and members to the trade union) to share the costs incurred during the bargaining
process.
7.3. Functions of Trade Unions and Employers’ Organizations
As can be read from article 15 of the labour proclamation the major functions of both trade unions
and employers’ associations are:
 to represent members in collective negotiations and labour disputes before the competent
body when so requested or delegated;
 to observe the conditions of work and fulfill the obligations set forth in the proclamation;
 to respect the rights and interests of their members in particular;
 to ensure that laws, regulations, directives and statements are known to as well as be
observed and implemented by their members; and
 to initiate law and regulations concerning employers and workers, and participate actively
during the preparation or amendments of such laws and regulations.
In addition to the activities mentioned herein above, both trade unions and employers’ associations
are expected to discharge other functions provided for in their respective constitutions. In addition
to the above functions, federations and confederations are expected to discharge functions such as
strengthening the unity and spirit of co-operation of their members, participating in the
determination or improvement of the conditions of work at the trade or industry level as well as
encouraging members to strengthen their participation in the construction of the national economy,
representing their organizations in any conferences; and discharging other functions in accordance
with their constitutions.
Apart from the various economic and social functions mentioned above, the role of trade unions
and/or employers’ associations (as an organized community) in the political sphere of the country
is neither expressly nor impliedly recognized under the current labour proclamation.
The 1963 proclamation under article 22 expressly prohibited those organizations from
participating in any political activities, whereas proclamation no. 64/1968, on the other hand, had
come up with a number of provisions that allowed these organizations to participate in the initiation
as well as determination of the political objectives and goals of the country. But, the current labour
proclamation says nothing about the role of trade unions and employers’ organization in the
political arena. In other words, the proclamation contains no single provision that neither expressly
prohibits nor allows those organizations to participate in political activities. However, workers’
and employers’ organizations must have full freedom to formulate their own programmes of
activities to defend the social as well as occupational interests of their members.
As the ILO convention No. 87, to which Ethiopia is a signatory, under article 3(1) states, some
legislative provisions regulating this area may be compatible with freedom of association
principles, provided that they are carefully drafted. The legislative drafter must take particular care
with provisions which touch on participation in political activities, and/or the right to strike.
The activities of workers’ and employers’ organizations cannot be completely separated from
political matters. Various social and economic policies formulated by the government will
inevitably have impacts on workers and employers, and therefore, their organizations must be free
to express their members’ views about such policies by appropriate means. The government, thus,
must ensure, if necessary by appropriate legislative measures, that workers and employers are left
free to exercise these rights.
Nonetheless, it is only organizations for furthering and defending the interests of their members
that are protected by convention No. 87, as article 10 of this convention says. Therefore, both
workers’ and employers’ organizations should not lose sight of the importance which should be
attached to the independence of the trade union movement. Neither workers’ nor employers’
organizations should enter into arrangements with political parties which would compromise their
continued independence, or their social or economic functions.

7.2. COLLECTIVE BARGAINING and COLLECTIVE AGREEMENTS

Collective bargaining is the process of collective negotiation to be conducted to this effect.
Collective agreement, on the other hand, is an end result of such collective negotiation. Collective
bargaining and collective agreement can be taken as the two most important concepts as far as the
collective aspect of labour relations is concerned.

7.2.1 COLLECTIVE BARGAINING

7.2.1 Definition and Significance
As the term itself implies “collective bargaining” in short refers to a process whereby workers
through their organizations negotiate with their employer or employers’ organizations regarding
matters on determination of working conditions and terms of employment, or the regulation of
relations between workers and employers or workers’ organizations and employers’
organization/s.
According to the ILO convention No. 154 article 2 collective bargaining is defined as all sort of
negotiations that take place between an employer, a group of employers or one or more employers’
organizations, on the one hand, and one or more workers’ organizations, on the other hand, for
determining working conditions and terms of employment; and/or regulating relationships
between workers and employers, or workers’ organization/s and employers’ organization/s.
Similarly article 124(2) of the Ethiopian labour proclamation defines it as any “negotiation made
between employers and workers organizations or their representatives concerning conditions of
work or collective agreement or the renewal and modifications of the collective agreement.” , as
you can see from the above definitions collective bargaining is one, and the major, of the collective
aspects of labour relations, and as such it presupposes the existence of trade unions, in particular.
In order to have collective bargaining the existence of a trade union or trade unions is a necessary
precondition. This is, of course, what has been reaffirmed by article 125(1) of the Labour
Proclamation. That is why we said earlier that the formation of a trade union, in particular, is vital
in all aspects of collective labour relations.
Collective bargaining is recognized worldwide as a crucial means for bringing industrial
democracy in every society. As a result, a large number of international instruments have come
about, at the international level, with the recognition of this core right of workers.
And such international instruments, just like other binding agreements, oblige ratifying states to
recognize and promote collective bargaining through domestic legislations and other appropriate
means.
The International Labour Organization (ILO) could be cited as the primary source which gives rise
to many of the international instruments made to recognize and promote collective bargaining. The
promotion of collective bargaining is one of the central and most important concerns of the ILO.
The importance of collective bargaining has been recently reaffirmed by the 1998 ILO Declaration
on Fundamental principles and Rights at work. As can be read from paragraph 2(a) of this
declaration, member states, irrespective of whether they have ratified the relevant conventions, are
obliged by the very fact of membership to the ILO, to promote and realize the principles
concerning the effective recognition of the right to collective bargaining.
There are also many other ILO conventions and recommendations, in particular the 1949 the right
to organize and collective bargaining conversion No. 98 and the 1981 collective bargaining
convention No. 154, which are made to this effect. Apart from the ILO conventions and
recommendations, the right to engage in collective bargaining had also been recognized by other
international and/or regional instruments such as the 1948 Inter-American Charter on Social
Guarantees, the 1561 European Social Charter, and the 1989 European Communities Charter on
Fundamental Social Rights of workers.
The importance given to collective bargaining in these international instruments on basic human
rights, as well as the law and practice of a great many states, is testimony to the emphasis given
by national and international social policy to the principle that workers, through their collective
right to organize in defense of their interests, should be enabled to use their collective power to
negotiate better terms and conditions of employment with employers for their members than each
worker could achieve by negotiating individually.
It is thus a means of seeking to overcome the unequal bargaining power of individual workers vis-
à-vis employer in negotiating individual employment contracts by according workers’
organizations a right to conclude collective agreements which supersede such contracts. In return,
employers can expect improved productivity from a more work force granted better working
conditions and sentiment that they are able to participate in determining these conditions.
The primary objective of national policy should be to promote and encourage free and voluntary
collective bargaining, allowing the parties the greatest possible autonomy, while establishing a
legal framework and an administrative structure to which they may have recourse, on a voluntary
basis and by mutual agreement, to facilitate the conclusion of collective agreements.
ILO convention No. 98 requires ratifying countries to: “take measures appropriate to national
conditions, where necessary, to encourage and promote the full development and utilization of
machinery for voluntary negotiations, with a view to regulation of terms and conditions of
employment by means of collective agreements. (Art. 4)” Convention No. 154 provides straighter
forwardly that ratifying countries are to; “take measures adapted to national conditions to promote
collective bargaining” (Article 5(1)).
One of the primary means by which member states seek to comply with those obligations is
through the enactment of labour legislation. Other means may include collective agreements,
arbitration awards, administrative rules and regulations, decrees and ministerial orders, as well as
the establishment of administrative bodies to monitor the observance of the legal obligations and
the provision of conciliation and medication services to assist the parties.

7.2.2 Parties to the Collective Bargaining and Procedural Requirements

Looking at the relevant ILO conventions and recommendations, one may say that the right to
engage in collective bargaining applies to all workers’ organizations and employers and their
organizations. Broadly speaking, all workers’ organizations and employers or their organizations
have the right to engage in collective bargaining. This is the general principle under international
instruments.
There are, however, exceptions to the extent that certain specific exclusions are permitted under
domestic legislations. Such exclusions that deny some sectors of workers’ organizations the right
to engage in collective bargaining is permissible under international instruments, provided that
they are made with due care. For instance, the ILO conventions No. 98, 151 and 154 provide that
the extent to which the right to engage in collective bargaining apply to the armed forces and the
police may be determined by national laws, regulations or national practices.
This means a government, by way of legislation or practice, may deny or grant either partially or
completely, this right to these sectors of “workers” organizations. Moreover, convention No. 98
expressly provides that collective bargaining does not deal with the positions of public servants
engaged in the administration of the state. This indicates that although such persons have the right
to organize by virtue of convention No. 87, this does not guarantee that the right to engage in
collective bargaining is extended to employees of this category.
Under Ethiopian law, collective bargaining as a collective right is recognized by the labour
proclamation. And, this right applies to all trade unions and employers or their organizations as
defined by this proclamation. This is to mean that the right to engage in collective bargaining
applies to workers’ organizations and employers or their organizations that are governed by the
Labour Proclamation.
By virtue of article 125 of this proclamation, parties to a collective bargaining are trade unions and
one or more employers or their organizations. Thus, the existence of a trade union is a necessary
prerequisite in order to enjoy /exercise/ the right to engage in collective bargaining. In an enterprise
where there exist more than one trade union it is the trade union which gets 50%+1 or more support
by all employees of the enterprise that can exercise this right (see article 115(a) of proc. No 1156).
Collective bargaining is required to be made with the free consent of the parties. Accordingly, any
party who wishes to engage in collective bargaining can request the other party to this effect. The
request is required to be made in writing. The party who wishes to do so is also required to prepare
and submit a draft on matters for negotiation.
Among other things, each party to a collective bargaining shall have the duty to bargain in good
faith. Effective collective bargaining involves the stimulation of dialogue and the promotion of
consensus. The ultimate purpose of this kind of duty is to ensure that parties have every possible
opportunity to reach on agreement. This is a very important requirement which has been given
emphasis by lots of international and national legislations. Under the ILO Recommendation No.
183, this requirement is extended to a duty incumbent upon the employer, as a party to negotiation,
to provide the trade union with information required for meaningful negotiations.

7.3 COLLECTIVE AGREEMENTS

7.3.1 Definition and Nature of Collective Agreement
One of the central objectives of collective bargaining is to conclude a collective agreement.
Collective agreement is the result of joint negotiation between two sides of industry, that is, a trade
union and an employer or employers’ association.
It is defined by article 114 of the Labour proclamation as “an agreement concluded in writing
between one or more representative of trade unions and one or more employers or agents or
representatives of employers’ organizations”. The agreement to be concluded may be relating to
matters concerning employment relationships and conditions of work or regarding the relations of
employers and their organizations with trade unions.
In addition, article 129 of the proclamation gives a list of the specified matters to be included
within the collective agreement. Collective agreements have two major functions. On one level
they deal with issues important to the trade union as an entity and the employer or employers’
organizations. This is because such agreements would deal with matters such as negotiation rights,
when the agreement will be renegotiated, and so on. Such issues are not as such important to the
relationship of the individual employee and his/her employer and as such do not bind the individual
parties. But, on the other hand, many terms of the agreement could be relevant to the individual
employee, in particular terms such as the conditions for protection of occupational safety and
health, arrangement of working hours etc. It is, therefore, important to see the enforceability of the
agreement between the collective parties and individual parties.

7.3.2 Enforceability of the Terms of a Collective Agreement

A collective agreement operates on two levels. It is first an agreement between the union and the
employer or employers’ organization/s. As a result, it binds those entities as they are parties to the
agreement. As article 139 of proclamation No. 1156 says “the provision of a collective agreement
shall be applicable to all parties covered by it”.
In addition to this, article 135(1) of the proclamation states that where a trade union which is a
party to a collective agreement dissolved, the collective agreement shall continue to be valid
between the workers and the employer. Those provisions indicate that collective agreement is a
legally binding agreement at both the collective and individual level. This means the trade union
which is party to a collective agreement can enforce the terms of the agreement against the
employer and vice-versa, on the basis of privity of contract.
In addition to being an agreement between the collective parties, the agreement concluded by the
trade union and employer or employers’ organization is likely to affect individual employees.
Matters relating to wages, for example, will affect all of the workers of an enterprise. However,
the problem that may arise is how can the individual worker enforce the terms of a collective
agreement against the employer?
In some countries the individual employee can hardly enforce the terms of the agreement on the
basis of privity of contract. This is because it is the union, and not the individual employee, who
is a party to the collective agreement. Thus, the only way the individual can enforce the relevant
provisions of the agreement against his/her employer in such countries is only if those provisions
have become part of the employment contract between them.
Accordingly, terms at the collective level can become incorporated into individual’s employment
contract either impliedly or expressly. The former way of incorporating the terms of a collective
agreement into the individual contract of employment is the most complex and it is probably the
most common one. The basis of implied incorporation is that there is evidence that both parties
have accepted the agreement as binding. On the part of the employer this is not difficult as he is
often one of the parties who negotiated the agreement at the collective level and obviously agrees
to be bound by it. On the part of the individual employee, there are a variety of ways whereby
courts could determine whether the individual has impliedly accepted the agreement as binding.
One of such a ways is that if the employee continued working once the collective agreement had
been signed, this indicates acceptance on his part of the relevant provisions of the agreement.
Express incorporation is the other way of incorporating the terms of a collective agreement into
the individual contract.
The major problem with implied incorporation is the matter of evidence that whether the employee
has accepted the change in his/her terms and conditions of employment. Express incorporation of
the agreement provides such evidence. Such incorporation is a simple process and merely requires
a statement in the agreement to the effect that the relevant previsions of the agreement concluded
by a certain trade union shall be part of individual’s contract of employment. as far as our law is
concerned the individual employee needs neither such implied nor express acceptance in order to
enforce the relevant provisions of a collective agreement.
As it can be seen from article 134 and 135 of the Labour Proclamation, either the trade union, as
an entity, or workers individually can enforce the relevant provisions of the agreement against the
employer. What matters under our law is whether the relevant provisions of the collective
agreement is more favorable to the workers in similar matters than those provided by law. So long
as the relevant provisions of the collective agreement provide more benefits to workers than those
provided by law, those provisions bind the employer. Therefore, the enforceability of such terms
seems undisputable whether it is challenged by the collective parties or individual employees.
7.3.3 Conditions for the Validity of a Collective Agreement
Collective agreements, just like other binding contracts, need to fulfill the necessary conditions
required by law for its validity. Conditions of validity of a collective agreement include
requirements such as regarding the form and content of the collective agreement, the legal force
of the collective agreement and who they bind, registering the agreement with the Ministry of
Labour and Social Affairs, and so on.
Accordingly, the law requires a collective agreement to be in writing, indicate the parties to the
agreement, and be signed by representatives of the parties to the agreement.
A collective agreement is also required to indicate the date on which it comes into force. This
requirement, however, is not a mandatory requirement unlike the former requirements. The date
at which the agreement starts to be effective is left to be determined by the parties. Thus, failure
to indicate such date does not affect the validity of the agreement. In case where parties fail to
indicate such date in the collective agreement, the agreement would have a legal effect as from the
date of signature by virtue of article 133(2) of the Labour Proclamation.
Registering a collective agreement with the Ministry of Labour and Social Affairs is the other
essential requirement for its validity. This requirement is imposed with the view to allow the
minister to follow developments in collective bargaining, to determine whether there is any legal
defect in the agreement and inform the parties thereof, and to be better prepared to assist the parties
in dealing with any disputes arising out of the agreement or in further negotiations between the
same parties.
Indicating the length of time for which a collective agreement expires is another requirement. Just
like the date of commencement of its legal effect, this is not a mandatory requirement that affects
its validity. Parties by agreement may indicate the time in which the agreement ceases to be
effective. In case where parties fail to indicate such time in the agreement, the law provides a three
(3) years period for effective functioning of the agreement. No party can challenge, unless
expressly stipulated otherwise in the agreement, the collective agreement before 3 years from the
date of its validity unless a major economic change occurs. Upon the occurrence of a major
economic change, any party who seeks to challenge the collective agreement may submit the
reason to the Ministry before the expiry of the 3 years period. The last and the most important
condition for the validity of a collective agreement relates to its content. A collective agreement is
expected to satisfy, at least, the minimum standards set by the labour proclamation, particularly
standards set in favor of workers.
Provisions of a collective agreement can be applicable only if they are not less favorable to the
workers in similar matters than those provided for by law. As can be read from article 133(1) of
the proclamation, “any provision of a collective agreement which provides for conditions of work
and benefits which are less favorable than those provided for under this proclamation or other laws
shall be null and void”. Therefore, in order to have a valid collective agreement, the provisions of
the agreement shall not prejudice the minimum standards set by the labour proclamation or other
laws.