Collective Bargaining

Process and Its

Outcome
 College of Business & Economics
CHED Center of Development in Business & Management Education

Collective Bargaining Process

and Its Outcome

SERIES 1999-03

Divina M. Edralin, Ph.D.

De La Salle University, Philippines

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 About the Author

Dr. Divina M. Edralin is a Full Professor at the Business Management

Department of the College of Business and Economics (CBE) of De La
Salle University-Manila. She is also the Director of the Center for
Business and Economics Research and Development (CBERD). She also
holds the Don Antonio L. Tambunting Sr., Professorial Chair in Business
Administration. She earned her Doctor in Management from De La Salle
University-Manila, and her MA Industrial Relations from the Institute of
Industrial Relations of the University of the Philippines. Her areas of
expertise and research interest include human resource management,
entrepreneurship, collective bargaining, and labor issues.
 Abstract
Dr. Divina Edralin

This research on the collective bargaining process as initiated by trade unions

and the results of such efforts had been undertaken on the premise that trade unions
are founded on the principle of strength in numbers, and organized to fight for the
worker’s rights, get better terms and conditions of work, and improve the overall
quality of life and political power of its members, primarily through collective
bargaining with employers. A survey was conducted among 90 unionized firms in
Metro Manila, with both union and management representatives taken as
respondents. Content analysis of the existing CBA in the unionized firms was done
to determine the common economic and political issues negotiated by collective
bargaining.
Results indicate that the collective bargaining process is time-consuming
because of the le ngth of time involved in preparing the proposals and counter
proposals, the long hours spent during negotiations which is stretched over an
average of nine (9) months, and the monitoring of the implementation of the CBA
which is for a period of three to five years. The collective bargaining process is also
a complicated encounter because of the varying strategies and tactics used by both
parties in the pre-negotiation and actual negotiation stages. Other factors that add to
the complexity of the process include the composition of the respective panels of
negotiators (particularly the presence of a lawyer), and the differing attitudes and
goals of the panel members.
The study also reveals that the type of industry to which the company
belongs, and the union’s membership in a federation have no correlation with the
number of strategies and success factors identified by both union and management.
The number of economic issues negotiated are significantly different
according to the type of industry, with unions in the non-manufacturing sector getting
more than those in the manufacturing sector. On the other hand, the number of
political issues bargained by the federated unions are significantly different from the
number bargained by the independent unions, with the federated unions getting more,
particularly provisions related to union assistance.
Lastly, both management and union have the same perception on the factors
that will contribute to the success of the collective bargaining process foremost of
which is trust between parties.
 Collective Bargaining Process and Its Outcome
Dr. Divina Edralin*
“Good labor relations…. Cannot be brought about by legislation….
I believe that enlightened labor and enlightened management working
together, can accomplish far more by peaceful bargaining than is
possible though legislation.” (Harry Truman)

1. Introduction

The trade union, as a form of organization among workers, evolved in

different parts of the world, in widely differing conditions and for varying reasons.
Its historical formation from the early 1800s can be traced to economic, political, and
social theories. As cited by Flippo (1984), trade unions are formed by the workers
“to promote, protect, and improve, through collective action, the social,
economic, and political interests of its members.” Corrollarily, Hoxie (1986)
argued that labor unions’ primary aim is to protect and pursue the economic interests
(such as raise wages, shorten hours of work, and increase the security of
employment) of its own members. The Constitution and By-laws of one of the most
active national trade unions in the Philippines, which is called the National Union of
Workers in the Hotel, Restaurant and Allied Industries, stipulates that its four main
objectives are to: (1) unite and organize all workers into one union; (2) promote job
security and defend workers’ rights to self- organization, collective bargaining, and
concerted action; (3) secure better terms and conditions of work; and (4) promote and
advance the interests and general welfare of workers. These objectives are very
similar to those cited in the economic, political and social theories on the formation of
unions. Even the Philippine Labor Code (1998) defines a labor organization as “any
union or association of employees which exists in whole or in part for the
purpose of collective bargaining or of dealing with employers concerning terms
and conditions of employment.”
The available literature also show that the development of trade unions over
the years had been very complicated, and like a pendulum, swings as much between
experiences of failures as well as of successes. Today’s labor unions, however, have
reached a critical point in their history, and their role in society is hotly disputed
(McConville, 1986). This situation may be attributed to the fact that trade unions, as
observed by Dijillas (1994), have considerable varying impact on the economic
growth and political stability of the country.
On the premise that trade unions are founded on the principle of strength in numbers,
and organized to fight for workers’ rights, get better terms and conditions of work,
and improve the overall quality of life and political power of its members, primarily
through collective bargaining with employers, this research on the collective

*
I wish to acknowledge Ms. Ma. Theresa Mosquito for her assistance in the tabulation and statistical analysis
of the sample data. Thanks are accorded to Mr. Eleazar Tolledo for facilitating the collection of the data
through his Industrial Relations students under the Applied Corporate Management Program of the Business
Management Department. I also thank Mr. Raymund Habaradas for editing the paper.
 bargaining process as initiated by trade unions, and the results of such efforts, had
been undertaken. Specifically, this paper aimed to:
1. identify the dynamics of the collective bargaining process in terms of its:
1.1 principles
1.2 stages
1.3 composition of the panel of negotiators
1.4 strategies used in the negotiation
2. determine the outcome of the collective bargaining process in terms of the
common political and economic issues covered in the collective bargaining
agreement (CBA);
3. identify significant differences in the number of strategies used by the parties,
number of political and economic issues negotiated, and number of success
factors experienced in the collective bargaining process based on the type of
industry of the firms and union affiliation with a federation.
4. correlate the number of strategies used by the parties, number of political and
economic issues negotiated, and number of success factors experienced based
on the type of industry of the firms and union affiliation with a federation.
5. analyze the difficulties/problems encountered by the union and management
during the collective bargaining negotiations; and
6. determine the factors that contribute to the success of collective bargaining
negotiations.

2. Theoretical Framework
Collective bargaining is a long, complex, and emotional-rational process, the
outcome of which depends on the balance of power between the union and
management and their bargaining stances (Ballot, 1992).
It is defined by Byars and Rue (1991) as a process that involves the
negotiation, drafting, administration, and interpretation of a written agreement
between an employer and a union for a specific period of time . This process
therefore involves proposals and counter-proposals, demands and counter-demands
wherein each party tries to obtain for itself the best or most favorable terms and
conditions. It also involves constant communication between the union and the
management during the effectivity of the written contract in order to avoid disputes in
the interpretation and implementation of its provisions.
By the same token, Baldoz (1995) explained that collective bargaining, which
is basically a wage-setting and dispute settlement system, is the centerpiece of the
industrial relations in the Philippines. It is a procedure whose end result is the
making of collective agreements between employer and accredited representatives of
employees concerning political and economic issues of employment. It requires both
parties to deal with each other with open
and fair minds, and to sincerely endeavor to overcome obstacles existing between
them to the end that industrial relations may be successful, peaceful, and beneficial to
both parties. However, collective bargaining does not end with the execution of an
agreement. It is a continuous process and involves a continuing legal duty.
As indicated, the end result of the collective bargaining process is a contract
which is called the Collective Bargaining Agreement or simply CBA. The CBA
stipulates the joint understanding of the union and management concerning wages,
hours of work, and all other terms and conditions of employment within the
bargaining unit, including mandatory provisions for grievance and arbitration
machinery (BLES, 1998). In the USA, about 2.4 million workers are under major
collective bargaining agreements (those covering 1,000 workers or more) which are
scheduled to expire or be reopened in 1996. These workers constitute about 30
percent of the 8.2 million employees under such agreements in private industry and
State and local governments (Monthly Labor Review, 1996). In the Philippines,
683,000 workers or 23.8% of the total 2.865 million workforce of 6,540
establishments were reported to be covered by collective bargaining agreements
(CBAs) in 1997. The said companies with CBAs represented 15.1% of the total
number of 43,358 firms in the country in 1997. Per type of industry, the
manufacturing sector, which constituted the bulk of establishments, only had 18.3%
of such firms with CBAs; while the financing, insurance real estate and business
services had 33.1% of such firms covered by CBAs making it the industry with the
biggest slice of companies with CBAs (BLES, 1998). Refer to Appendix 1 for
details.
It can also be noted that the collective bargaining process seems to differ more
in style than in substance. Scarth (1994) in his study identified two styles, namely:
(1) the adversarial and (2) the cooperative. The adversarial style involves a high
degree of animosity and antagonism between the union and management during the
negotiation, while the cooperative style is more of a collaborative effort between the
union and management to arrive at an agreement. Power (1996) added a new
contract negotiation style called target-specific bargaining. This model is a team-
based, interactive process which helps one organization and its bargaining unit/s bury
old tensions and sign long-term agreements.

UNION SITUATION
• Federated or Not • Number of Years • Number of • Relationship with P
E in Operation Members Management O
C L
O INPUT CONVERSION OUTPUT I
N T
O I
Collective Bargaining Collective Bargaining
M C
Process Agreement
I
• Principles A
C • Factors of
• Stages Success
CBA Provisions L
S • Composition of • Problems •• Economic Issues
I Panel Encountered •• Political Issues S
• Strategies I
T T
U • Success Factors
U
A A
T T
I COMPANY SITUATION I
O • Financial Position • Type of Industry • Type of Owners • Relationship with the O
N Union N

Figure 1. Schematic Diagram of the Collective Bargaining Process

 Viewing collective bargaining as a dynamic and complex process of encounter
between the management and the union, whose respective goals differ from one
another, the above diagram summarizes the collective bargaining framework of the
study. Using the input-output model of Kast and Rosenweig (1974), the collective
bargaining process is considered as the input, while the collective bargaining
agreement which stipulates the economic and political issues negotiated is the output.
The factors of success and the problems encountered are then considered to be the
conversion variables. The input-output process is then assumed to be affected by both
the internal environment represented by the union and company situations and the
external environment the most important factors of which are the economic and
political scenarios.
3. Methodology
Descriptive and comparative research designs were employed to realize the
objectives of the study.
A survey among 90 unionized firms in Metro Manila was conducted with both
the union and management representatives taken as respondents for the survey. Table
1 presents the distribution of the actual samples.
The three page survey questionnaire, which had been pre-tested, focused on
gathering data related to company profile, union profile, strategies used by the union
and the management in the CBA negotiation, problems the parties encountered during
negotiation, and the factors of success experienced in CBA negotiations.
Content analysis of the existing CBA in each unionized firm was done to
determine the common economic and political issues negotiated by collective
bargaining.
The collected data were analyzed with the use of the SPSS (Statistical
Package for Social Sciences) program. The percentage, mean, and simple ranking
were utilized for the descriptive part. To test the null hypothesis for equality of means
for the groups, a non-parametric approach was used. Significance tests for
differences between the groups (by type of industry: manufacturing vs. non-
manufacturing; by type of union affiliation: independent vs. federated, by
respondent: union vs. management) was done. The independent samples t- test and
Mann-Whitney or U test were used to test for the equality of means. The Mann-
Whitney test is an alternative test which made use of the ranks to test the equality of
means. Kolmogorov-Smirnov was also used to test if the two groups compared come
from the same distribution. Furthermore, Spearman’s rank correlation coefficients
were obtained and significance tests of these coefficients were made to test the null
hypothesis on whether there is a correlation between the different variables under
study.

4. Findings
4.1 Profile of the Firms and their Unions
Ninety (90) unionized firms, composed of 42 manufacturing (47%) and 48
non-manufacturing (53%) establishments, participated in the survey. Classified by
size of employment, 6.67% are small, 10% are medium and 83.33% are large
companies with an average of 1,613 employees. By ownership, 34% are
multinationals, 29% are Filipino-Chinese, 22% are Filipino, 7% are Chinese, and 7%
are owned by other nationalities. Moreover, these companies, which are
predominantly corporations (98%), had been in existence for an average of 37 years,
with some of the firms operating for at least five years, and for as long as
more than 80 years. (Refer to Table 2)
Table 1. Distribution of Sample Firms and the Type of Respondents
Union Management Total
Representa- Representa- Number %
tives tives of (over
Type of Industry (Frequency) (Frequency) Samples Total)
Manufacturing Companies
Appliances and Electronic 3 3 6 3.33
Products
Ceramics 2 2 4 2.22
Construction Materials 5 5 10 5.56
Consumer Products 5 5 10 5.56
Food and Beverage 5 5 10 5.56
Industrial Chemicals,Rubber, 3 3 6 3.33
and Paints
Machinery and Equipment 2 2 4 2.22
Packaging 2 2 4 2.22
Pharmaceutical and Chemicals 8 8 16 8.89
Textile and Garments 6 6 12 6.67
Tobacco 1 1 2 1.11
Subtotal (Manufacturing) 42 42 84 46.67
Non-Manufacturing Companies
Banking 14 14 28 15.56
Cargo/Transportation 4 4 8 4.44
Computer Products 1 1 2 1.11
Construction Materials 1 1 2 1.11
Electricity 1 1 2 1.11
Hospital 2 2 4 2.22
Hotels, Restaurants, and Resorts 10 10 20 11.11
Insurance 4 4 8 4.44
Manpower Services 1 1 2 1.11
Pharmaceutical and Chemicals 4 4 8 4.44
Retail/Wholesale 2 2 4 2.22
Telecommunications 4 4 8 4.44
Subtotal (Non-Manufacturing) 48 48 96 53.33
Over-All Total 90 90 180 100.00
Table 2. Profile of Respondent Companies
Number Of
Characteristics Firms %
Type of Industry
Manufacturing 42 46.67
Non-Manufacturing 48 53.33
Total 90 100.00
Size Based on Employment
SMALL (10-99 Employees) 6 6.67
MEDIUM (100-199 Employees) 9 10.00
LARGE (200 or MORE) 75 83.33
Total 90 100.00
Average Number of Employees 1,613
Standard Deviation 2,380
Minimum No. of Employees 44
Maximum No. of Employees 10,000
Type of Ownership
Filipino 20 22.22
Chinese 7 7.78
Filipino-Chinese 26 28.89
Multinational/Transnational 31 34.44
Others 6 6.67
Total 90 100.00
Form of Ownership
Single Proprietorship 1 1.11
Partnership 1 1.11
Corporation 88 97.78
Total 90 100.00
Years of Existence
5-20 Years 23 25.56
21-40 Years 31 34.44
41-60 Years 26 28.89
61-80 Years 5 5.56
80 Years or More 5 5.56
Total 90 100.00
Average Years of Existence 37
Minimum (in Years) 6
Maximum (in Years) 147
 In unionized companies, the union had been operating for an average of 18
years covering about 21%-90% of the bulk of the rank and file employee population.
The average number of union members, given this percentage of coverage, is 807
employees with a minimum of 40 and a maximum of 6,753 members. There are 48
(53%) independent local unions and 42 (47%) federated workers’ organizations. The
federated local unions have been affiliates of national trade union centers like the
Trade Union Congress of the Philippines (TUCP); national unions such as the
National Union of Workers in Hotel and Restaurant and Allied Industries
(NUWHRAIN); and federations such as the Federation of Free Workers(FFW) for an
average of 12 years. The unions have had an average of 4 CBAs with the same
employer. It took an average of nine months for their negotiations on their present
CBA to be concluded.

Table 3. Union Profile

Number Of
Characteristics Firms %
Years of Existence
1-10 Years 33 36.67
11-20 Years 19 21.11
21-30 Years 13 14.44
31 Years or More 25 27.78
Total 90 100.00
Average Years of Existence 18
Minimum (in Years) 1
Maximum (in Years) 45
Membership as a Percentage of Employee Population
Less Than 10% 5 5.56
10-20% 10 11.11
21-50% 24 26.67
51-70% 20 22.22
71-90% 26 28.89
90% or More 5 5.56
Total 90 100.00
Average Number of Union Members 807
Minimum No. of Union Members 40
Maximum No. of Union Members 6,753
Type of Union Affiliation
Independent 48 53.33
Federated 42 46.67
Total 90 100.00
Table 3. Continued
No. of Firms
Characteristics %
Number of CBAs
1-3 43 47.78
4-6 17 18.89
7-9 7 7.78
10-11 9 10.00
Do Not Know/No Answer 14 15.56
Total 90 100.00
Average Number of CBAs 4
Minimum No. of CBAs 1
Maximum No. of CBAs 11
Number of Months of Negotiations for Present CBA
Less Than 1 Month 7 7.78
1-3 Months 27 30.00
4-6 Months 27 30.00
7-9 Months 8 8.89
10-12 Months 4 4.44
More Than 12 Months 7 7.78
Do Not Know/No Answer 10 11.11
Total 90 100.00
Average Number of Months 9
Minimum 2 Days
Maximum 54 Months
Federation/National Center
All Workers Alliance Trade Unions (AWATU-TUCP) 1 2.38
Alliance of Filipino Workers (AFW-LMLC) 1 2.38
Anglo – Kilusang Mayo Uno (ANGLO-KMU) 2 4.76
Associated Trade Unions (ATU-TUCP) 6 14.29
Confederation of Free Workers (CFW-PDMP) 3 7.14
Confederation of Labor and Allied Social 2 4.76
Services (CLASS-TUCP)
Drug and Food Alliance (DFA-KMU) 3 7.14
Federation of Free Workers (FFW) 4 9.52
February Six Movement (FSM-NCL) 1 2.38
National Federation of Labor Unions (NAFLU-NCL) 2 4.76
National Federation of Labor Unions (NAFLU-KMU) 3 7.14
Table 3. Continued
No. of
Characteristics Firms %

National Asociation of Trade Unions 1 2.38

(NATU-PDMP)
National Labor Union (NLU-TUCP) 1 2.38
National Union of Bank Employees (NUBE- 5 11.90
LMLC)
National Union of Workers In Hotel And 6 14.29
Restaurant and Allied Industries
(NUWHRAIN-APL)
Philippine Transport and General 1 2.38
Workers Organization (PTGWO-TUCP)
Total 42 100.00
Number of Years with the Federation
1-5 Years 7 16.67
6-10 Years 10 23.81
11-15 Years 4 9.52
16-20 Years 9 21.43
More Than 20 Years 12 28.57
Total 42 100.00
Average Number Of Years With The Federation 12
Minimum (In Years) 1
Maximum (In Years) 35

4.2 Collective Bargaining Process

4.2.1 Principles Used

The collective bargaining process in the surveyed unionized establishments
was based on four (4) principles which were not forms of begging that appealed to the
goodwill of the employer. These principles were:

(1) Recognition of opposing interests between labor and management - The

management’s interest is to get the most from the workers, at the lowest
possible cost, in order to maximize profit. This means offering low wages
and poor working conditions. In contrast to the employer’s aim to reduce
production cost to a minimum level, workers are interested in getting the best
possible conditions for their work: good wages, safe and healthful workplace,
an acceptable length of the working day, and other fringe benefits which
would allow them to live decently.
 (2) Settlement of the clash of interest by means of a compromise between the
workers’ demands and employer’s offer - A compromise requires good
faith and a flexible “give and take attitude” on both sides. Both parties
present their demands not as rigidly as a choice between “all-or-nothing”,
but with the willingness to concede, if necessary.
(3) Non-violence - The use of strike/ lockout and other forms of threat or
harassment to get one’s demands or offers accepted in the initial stages of the
negotiations is not deemed to be advantageous to both parties. Such restraint
prevented an early deadlock, and allowed the parties to exhaustively tackle all
issues involved. Peaceful alternative means are utilized by both parties to
arrive at an agreement.
(4) Bargaining autonomy - The shaping of working conditions through the
conclusion of collective bargaining agreements is solely the responsibility of
unions and employers. Government only gets into the picture in cases of
deadlock, usually involving economic issues, particularly on wage.

Aside from these four principles, Byars and Rue (1991) also added the following
basic tenets of the collective bargaining process, to which the 90 unionized firms adhered :

1. Negotiation of relevant issues in good faith by both management and

the union.
2. Incorporation of the parties’ agreements into a written contract,
which is the CBA.
3. Administration of the daily working relationships according to the
terms and conditions of employment specified in the contract.
4. Resolution of disputes in the interpretation of the terms of the
contract through established procedures, like the grievance machinery.

4.2.2 Stages

The collective bargaining process of the sample companies involves three

major stages. These are:

(1) Pre-negotiation - This involved the union’s collection and analysis of

data which enabled it to outline its demands, come up with bases/
justifications for the demands, prioritize the demands, and write the
CBA proposal and present such proposal within 60 days prior to the
expiration of the existing contract. Both parties, particularly the union,
found the need to conduct extensive research related to the needs of
workers, the economy, the financial condition of the company, and
other relevant data to prepare and justify its proposals. On the other
hand, management reviewed thoroughly the union’s demands to be
able to give its counter proposals, particularly on those that have major
financial implications and those impinging on management
prerogatives.
 (2) Actual Negotiation - This included stating the initial offer; further
research to justify demands and counter-offers; deadlock on issues;
and final agreement. This stage also necessitated the use of strategies
and tactics by the respective panels designed to improve their chances
of securing provisions in the contract more beneficial to their
respective sides.

(3) Implementation of CBA - This was after both parties had signed the
contract, and the union members had ratified the same. Thus, the CBA
had taken effect. At this stage the union and management found it
necessary to have the same interpretation of the provisions of the
CBA to avoid disputes. The effectivity of the contracts covered a
variety of time periods, between one year and five years, the most
common being three years.

4.2.3 Composition of the CBA Negotiating Panel

One of the critical factors in the collective bargaining process is the people involved
in the actual negotiations. These negotiators at the bargaining table vary slightly as to job
title or position in the organization and number, depending on the type of union. Table 4
presents the usual members of the panel from both parties based on the survey.

Table 4. Common CBA Panel of Negotiators

Union Panel Freq % Management Panel Freq %
Member of Local Officers 42 100.00 IR/HRD Manager 42 100.00
a National • President Lawyer 35 83.33
Union, • Vice President Manufacturing/Plant 10 23.81
Federation • Secretary General Manager* 3 7.14
Or Center • Treasurer Employee Relations 1 2.38
• Auditor Controller 1 2.38
Federation Representative 30 71.43
• President
• Secretary General
• Adviser
• Legal Counsel
Observers/Research 3 7.14
Independent Officers 48 100.00 IR/HRD Manager 48 100.00
Enterprise • President Lawyer 15 31.25
Union • Vice President Senior Vice 8 16.67
• Board Members Controller 3 6.25
• Secretary Manufacturing/Plant 3 6.25
• PRO Finance 2 4.17
Lawyer 5 10.42 General Manager* 2 4.17
Employee Relations 1 2.08
Sales Manager 1 2.08
 When the union was affiliated with a federation, the federation representative, such as
the President, Secretary-General, Legal Counsel or Adviser formed part of the union panel
together with the local officers. If the union was independent, it was the officers composed of
the President, Vice-President, Secretary, Treasurer, and other authorized board members,
together with their lawyer, if any, who sat as the panel of negotiators.

On the side of management , whether the union was independent or federated, the
usual panel of negotiators were the IR/HRD, manager, and company lawyer.

The General Managers of the large companies rarely joined the negotiations, except
when there was an impending or an actual deadlock in the issues which would have a major
impact on the company, such as issues related to wages. The use of a lawyer as a panel
member was common to many companies since management tended to be legalistic in its
approach to the bargaining process.

In the context of the tripartite industrial relations system, the government only
mediates when there exists a deadlock in the collective bargaining negotiations, for which a
notice of strike or request for preventive mediation had been formally filed with the Labor
Department, particularly its National Conciliation and Mediation Board (NCMB).

4.3 Strategies in Collective Bargaining Negotiations

4.3.1 Strategies Used by the Union

The strategies utilized by the union in the entire duration of the collective bargaining
process contributed significantly towards determining the nature, type or extent of the
political and economic demands that they will be able to get from management.
Based on the responses of the 90 union representatives, their respective union panels
utilized an average of 18 strategies, the least of which was six and the most of which was 23.
The top five strategies commonly employed by the union in the collective bargaining
negotiations were: (1) Examining final copies before final signing; becoming extra careful
(82%);(2) Identifying which proposal/s can be compromised, to what extent, and in exchange
for what (79%); (3) Defining the ground rules (74%); (4) Identifying which proposal/s cannot
be compromised (72%); and (5) Listing information that can be obtained during negotiation;
keeping a scoresheet of what were discussed and the results of the discussion; and; showing
conviction in saying “No” and presenting facts to substantiate the arguments (70%).
On the other hand, the least frequently used strategies cited by less than the majority
were: If facts are vague, suspending judgement and negotiation on such issues (45%);
Identifying friends of labor in the Department of Labor & Employment (36%); and Not
agreeing on anything until you have agreed on everything (36%). Refer to Table 5.
Table 5. Strategies Used by the Union

Number of
Strategies Firms % Rank
Examining final copies before final signing; 74 82.22 1
becoming extra careful
Identifying which proposal can be compromised, 71 78.89 2
to what extent, and in exchange for what
Defining the ground rules 67 74.44 3
Identifying which proposal can be compromised 65 72.22 4
Listing information that can be obtained during 63 70.00 6
negotiation
Keeping a scoresheet of what were discussed 63 70.00 6
and the result of the discussion
Showing conviction in saying “No,” and presenting 63 70.00 6
facts to substantiate the arguments
Signing the final draft as basis of the final copies 62 68.89 8
Conducting continuous research to be able to 61 67.78 9
support/justify demands
Deciding what information to give/withhold during 59 65.56 10
negotiation
Having alternative proposals that will respond to 56 62.22 11
management’s unrealistic counter proposals
Pinpointing the best and most appropriate time 55 61.11 12
to negotiate and when a strike would be
most effective
Making the opening statements, with the management 53 58.89 13
making the response
Practicing equal footing during negotiation. 51 56.67 14
Avoid using “Boss” or “Sir” in addressing the management
panel
Expecting unforeseen crises and developments 50 55.56 15.5
that might occur in the course of bargaining
which requires new strategies and tactics
In case of deadlock, getting ready for a strike 50 55.56 15.5
Controlling the discussion and always taking the 48 53.33 17
initiative
Offering to write the draft of the final agreement 47 52.22 18
Building up a substantial collective bargaining 45 50.00 19
(strike) fund
If facts are vague, suspending judgement and 41 45.56 20
negotiation on such issues
Not agreeing on anything until they have agreed 32 35.56 21.5
on everything
Identifying friends of labor in Department of Labor and 32 35.56 21.5
Employment

Others 16 17.78 23
Table 5. continued.

Agree on certain terms of references before the start of negotiations

Appoint somebody with a loud voice to be a speaker
Conduct a seminar on CBA tactics before negotiations
Create an atmosphere of openness
Create an atmosphere of trust between parties
Identify management's possible fears about the outcome of
negotiation
Keep in close contact with members to prepare for any
possibilities
Let lawyer be an observer only. Have consultants from
academe/economists
Make sure that when bluffs are made, the union can sustain them
Make the net income of the company a basis for proposal
negotiations
Show sincerity in presenting arguments
Using "on and off the record" during negotiation/Off the Record minutes
Minimum Number of Strategies Used 6
Maximum Number of Strategies Used 23
Average Number of Strategies Used 18

By the type of industry, the manufacturing firm unions used an average of 18

strategies with a minimum of nine strategies and a maximum of 23. However, the unions in
the non-manufacturing business utilized an average of 17 strategies, with a minimum of six
and a maximum of 23. Moreover, the item analysis (Refer to Table 6) shows that “defining
the ground rules” and “examining final copies before final signing; becoming extra careful”
was used by a big bulk (93%) of the unions in the manufacturing, while the strategy of “not
agreeing on anything until they have agreed on everything” is the least frequently used
strategy. Among the non-manufacturing establishments, a great majority (73%) of the unions
employed the “examining final copies before final signing; becoming extra careful”, while
the least used was “identifying friends of labor in the DOLE.” The t-test (t=-0.92;
ρ=0.359) as well as the Mann-Whitney test (z = -0.8362; p = 0.403) reveal that at 95%
confidence level, there is no significant difference in the mean number of strategies used by
the unions by type of industry. The Kolmogorov Smirnov test ( K-S z = 0.507; p = 0.959)
indicates that the number of strategies used by unions in the manufacturing and non-
manufacturing firms do not come from the same distribution. The results of the tests are
shown on Table 7. The Spearman’s rank correlation coefficient (0.0886; p = 0.406) proves
the absence of correlation between the number of strategies used by union and the type of
industry. The correlation table is shown on Table 8.
Table 6. Strategies Used By Union By Type of Industry

Manufacturing Non-Manufacturing
% %
No. of (Over 42 No. Of (Over 48
Strategies Firms FIRMS) Rank Firms FIRMS) Rank
Examining final copies before final signing; 39 92.86 1.5 35 72.92 1
Becoming extra careful
Identifying which proposal can be compromised, to 37 88.10 3 34 70.83 2
what extent, and in exchange for what
Defining the ground rules 39 92.86 1.5 28 58.33 8.5
Identifying which proposal can be compromised 33 78.57 7 32 66.67 4.5
Listing information that can be obtained 31 73.81 8.5 32 66.67 4.5
during negotiation
Keeping a scoresheet of what were discussed and the 33 78.57 6 30 62.50 6
result of the discussion
Showing conviction in saying “No,” and 35 83.33 4 28 58.33 8.5
Presenting facts to substantiate the
arguments
Signing the final draft as basis of the final 29 69.05 11 33 68.75 3
Copies
Conducting continuous research to be able 34 80.95 5 27 56.25 11.5
To support/justify demands
Deciding what information to give/withhold 31 73.81 9 28 58.33 8.5
during negotiation
Having alternative proposals that will 28 66.67 14.5 28 58.33 8.5
respond to counter proposals management’s
unrealistic
Pinpointing the best and most appropriate 29 69.05 11 26 54.17 13.5
would be most effective
Making the opening statements, with the 28 66.67 14.5 25 52.05 15.5
management making the response
Practicing equal footing during negotiation. 28 66.67 14.5 23 47.92 17
Avoid using “Boss” or “Sir” in Addressing the
management panel
Expecting unforeseen crises and developments that 28 66.67 14.5 22 45.83 18
might occur in the course of
bargaining which requires new strategies
and tactics
In case of deadlock, getting ready for a 23 54.76 17 27 56.25 11.5
Strike
Controlling the discussion and always
taking the initiative
Offering to write the draft of the final 22 52.38 18 25 52.08 15.5
agreement
Building up a substantial collective 19 45.24 20 26 54.17 13.5
bargaining (strike) fund
If facts are vague, suspending judgement 21 50.00 19 20 41.67 19
and negotiation on such issues
Table 6 continued.

Manufacturing Non-Manufacturing
% %
No. of (Over 42 No. Of (Over 48
Strategies Firms FIRMS) Rank Firms FIRMS) Rank
Not agreeing on anything until they have 15 35.71 22 17 35.42 21
agreed on everything
Identifying friends of labor in Department of 17 40.48 21 15 31.25 22
Labor and Employment

Others (Refer to Table 5 for details) 8 19.05 23 8 16.67 23

Minimum Number of Strategies 9 6

Used
Maximum Number of Strategies 23 23
Used
Average Number of Strategies 18 17
Used
Table 7. Significance Tests
Type Of Industry Type of Union Affiliation Respondent (Union/Mgmt.)
Result
Result Result Result Result Result OF Result Result Result
oF T-Test oF Mann OF OF T-Test OF Mann Kolmogorov OF T-Test OF Mann OF
(Equality Whitney U Kolmogorov (Equality Whitney U Smirnov Test (Equality Whitney U Kolmogorov
Variables of Means) Test Smirnov Test of Means) Test of Means) Test Smirnov Test

Number of Strategies t = -0.92 z = -.8362 z = 0.507 t = -0.9 z = -1.2097 z = 0.732 N.A. N.A. N.A.
Used by Union p = 0.359 p = 0.403 p = 0.959 p = 0.373 p = 0.2264 p = 0.657

Number of Strategies t = 0.65 z = -0.6197 z = 0.493 t = - 0.64 z = -1.2760 z = 0.789 N.A. N.A. N.A.
Used by Management p=0.515 p = 0.5355 p = 0.968 p=0.522 p = 0.202 p = 0.562

Number of Economic t = 3.26** z = -3.1813** z = 1.507** t = -0.39 z = -0.5684 z = 0.676 N.A. N.A. N.A.
Issues Covered p = 0.002 p = 0.0015 p = 0.021 p = 0.696 p = 0.5698 p = 0.751

Number of Political t = -0.65 z = -0.8689 z = 0.831 t = -5.37** z=- 4.9118** z = N.A. N.A. N.A.
Issues Covered 2.507**
p = 0.516 p = 0.3849 p = 0.495 p = .000 p = .000 p = 0.000

Number of Success t = 0.94 z = -0.9177 z = 0.929 t = - 0.79 z = 0.732 z = 0.789 t =- 0.14 z = -0.220 z = 0.246
Factors Experienced p=0.351 p = 0.358 p = 0.354 p=0.432 p = 0.657 p = 0.562 p=0.890 p = 0.8243 p = 1.000

Legend:
** t/z is significant when ρ<0.05 which means that there is a significant difference between the means of the two groups (manufacturing vs. non-manufacturing, union vs. management,
independent vs. federated)

* NA – Computations are Not Applicable

Table 8. Correlation Table (Using Spearman’s Rank Order Correlation)

Number of Number of Number Of Number Of Number Of

Strategies Used Strategies Used Economic Issues Political Issues Success Factors
Variables By Union by Management Covered Covered Experienced
Type of 0.0886 -0.1353 -0.3372** 0.0921 0.0688
Business p = 0.406 p=0.204 p = 0.001 p = 0.388 p = 0.360
Type of 0.1282 0.0657 0.0602 0.5206** 0.0405
Union p = 0.228 p = 0.5390 p = 0.573 p = 0.000 p = 0.5400
Affiliation
Respondent Coefficient Coefficient 0.0000 0.0000 0.0166
(Union/Mgmt) cannot cannot p = 1.0000 p = 1.0000 p = 0.8250
be computed be computed

Legend:

** p < 0.05, significant correlation

NOTE : Correlation coefficient values above the p values indicate the variability explained by the relationship between the two variables but do not
necessarily explain a cause and effect relationship
 According to the type of union affiliation, independent unions employed an average
of 17 strategies, with a minimum of six and a maximum of 23. The federated unions, on the
other hand, utilized an average of 18, with as few as nine and as many as 23 strategies.
(Refer to Table 9).The item analysis confirms that by type of union affiliation, the number
one frequently used strategy was “examining final copies before signing” (77% for
independent and 83% for federated) and the least employed strategy for independent unions
was “not agreeing on anything until they have agreed on everything“ (25%). For federated
unions, the least used strategy was “identifying friends of labor at DOLE” (33%). The t- test
outcome (t=-0.9; ρ =0.373) and the Mann Whitney U test (z = -1.2097; p =0.2264) illustrate
that there is no significant difference in the mean number of strategies used by the unions by
their type of affiliation. This is further confirmed by the Kolmogorov-Smirnov test (K-S z =
0.732; p = 0.657) which illustrates that there is no significant difference in the distribution of
samples from the two groups (independent and federated unions based on number of
strategies used by the union negotiators (Refer to Table 7). The Spearman rank order
correlation coefficient computed value (0.1282, p=0.228) also pinpointed that there is no
correlation with the number of strategies used and the type of union affiliation (Refer to
Table 8)

Table 9. Strategies Used By Union By Type of Union Affiliation

Independent Federated
No. of % Rank No. of %
Firms (Over Firms (Over
Strategies 48 FIRMS) 42 FIRMS) Rank
Examining final copies before final 37 77.08 1 35 83.33 1
signing: becoming extra careful
Identifying which proposal can be 36 75.00 2 33 78.57 1.5
compromised to what extent, and in
exchange for what
Defining the ground rules 34 70.83 3.5 30 71.43 6
Identifying which proposal can be 34 70.83 3.5 29 69.05 9.5
compromised
Listing information that can be obtained 32 66.67 5.5 25 59.52 15
during negotiation
Keeping a scoresheet of what were 32 66.67 5.5 30 71.43 6
discussed and the result
and the result of the discussion
Showing conviction in saying “No,” and 29 60.42 9 32 76.19 4
presenting facts to substantiate the
Arguments
Signing the final draft as basis of the 29 60.42 9 29 69.05 9.5
final copies
Conducting continuous research to be 29 60.42 9 33 78.57 1.5
able to support/justify demands
Table 9. Continued
Independent Federated
% %
No. of (Over No. of (Over
Strategies Firms 48 FIRMS) Rank Firms 42 FIRMS) Rank
Deciding what information to give/withhold 29 60.42 9 28 66.67 13
during negotiation
Having alternative proposals that will 25 52.08 14.5 29 69.05 9.5
respond to management’s unrealistic
counter proposals
Pinpointing the best and most to 26 54.17 13 26 61.90 14
negotiate and when a strike would
be most effective
Making the opening statements, with the 27 56.25 12 24 57.14 16
management making the response
Practicing equal footing during 28 58.33 11 30 71.43 6
negotiation. Avoid using “Boss” or
“Sir” in addressing the management
panel
Expecting unforeseen crises and 24 50.00 16 29 69.05 9.5
developments that might occur in the
course of bargaining which requires
new strategies and tactics
In case of deadlock, getting ready for a 20 41.67 19.5 28 66.67 13
strike
Controlling the discussion and always 21 43.75 18 21 50.00 18
taking the initiative
Offering to write the draft of the final 25 52.08 14.5 20 47.62 19
agreement
Building up a substantial collective 20 41.67 19.5 23 54.76 17
bargaining (strike) fund
If facts are vague, suspending judge- 23 47.92 17 16 38.10 21
ment and negotiation on such issues
Not agreeing on anything until they have 12 25.00 22 19 45.24 20
agreed on everything
Identifying friends of labor in Department 17 35.42 21 14 33.33 22
of Labor and Employment
Others (Refer to Table 5 for details) 7 14.58 23 9 21.43 23

Minimum Number of Strategies 6 9

Maximum Number of Strategies 23 23
Average Number of Strategies Used 17 18
4.3.2 Strategies Used by Management

Management utilizes various negotiation strategies to lessen costs (most

directly in terms of lost sales and profits) since management works with a relatively
defined set of objectives (primarily profit maximization) and determines the overall
programs to reach these objectives. Based on the replies of the 90 management
representatives in the survey, their management panels employed an average of three
strategies with as few as one and as many as nine. The top three frequently
mentioned strategies were (1) “examining meticulously the details of each union
proposal” (58%); (2) “offering a “package deal” to save on labor costs” and
“background checking of the negotiation panel of the union” (50%); and (3) “offering
the least as a counter proposal to the union” (47%). The admitted least utilized
strategy by management is “harassing union negotiation panel members” (3%).

Table 10. Strategies Used by Management

Strategies No. of firms % Rank
Examining meticulously the details of each proposal 52 57.78 1
Background checking of the union's negotiation panel 45 50.00 2.5
Offering a “package deal” to save on labor costs 45 50.00 2.5
Offering the least as a counter proposal 42 46.67 4
Explaining that the company is not generating profit 34 37.78 5
Adding or subtracting a few significant points in the 28 31.11 6
Final minutes of the CBA
Not giving the true financial condition of the company 21 23.33 7.5
Bluffing 21 23.33 7.5
Others 15 16.67 9
Preparing several proposals for each provision
Emphasize that all activities in the company are geared
towards labor-management partnership
Base the initial proposals on previous CBA
Take time to listen and show that management
understand the position of union
Create an atmosphere of trust and open communication
Define the ground rules
Agree to avoid foul language during negotiations
Present CBAs of other companies from the same industry for comparison
Maintain a friendly atmosphere
Practice an open-book policy regarding the financial standing of company
Sending pro-management workers during union 10 11.11 10
meeting to spy
Harassing union negotiation panel members 3 3.33 11
Minimum Number of Strategies Used 1
Maximum Number of Strategies Used 9
Average Number of Strategies Used 3
 Classified by type of industry, the manufacturing sector reply shows an
average of three strategies, with the use of at least one and as many as nine, in their
negotiations with the union. While, the non-manufacturing management panels
employ an average of four strategies, and the same range of strategies as that of the
manufacturing group.

Table 11. Strategies Used By Management By Type of Industry

Manufacturing Non-Manufacturing
% %
(Over (Over
No. of 42 No. of 48
Strategies Firms Firms) Rank Firms Firms) Rank

Examining meticulously the details of 32 76.19 1 20 41.67 1

each proposal
Background checking of the union's 27 64.29 2 18 37.50 2
negotiation panel
Offering a “package deal” to save on 29 69.05 3 16 33.33 4
labor costs
Offering the least as a counter proposal 25 59.52 4 17 35.42 3
Explaining that the company is not 19 45.24 5 15 31.25 5
generating profit
Adding or subtracting a few significant 17 40.48 6 11 22.92 8
points in the final minutes of the CBA
Not giving the true financial condition of 8 19.05 8 13 27.08 6
the company
Bluffing 9 21.43 7 12 25.00 7
Others (Refer to Table 10 for details) 5 11.90 9.5 10 20.83 9
Sending pro-management workers 5 11.90 9.5 5 10.42 10
during union meeting to spy
Harassing union negotiation panel 1 2.38 11 2 4.17 11
Minimum Number of Strategies 1 1
Maximum Number of Strategies 9 9
Average Number of Strategies 3 4

Furthermore, the content analysis of the responses reveals that, in both

industry sectors, “examining meticulously the details of each proposal” ranks first and
“harassing union negotiation panel members” ranks last. See Table 11. The t- test ( t=
0.65; p=0.515) as well as the Mann-Whitney test (z= -0.6197; p =0.5355) show that
there is no significant difference in the mean number of strategies employed by the
management panel by type of industry. The Kolmogorov-Smirnov test (K-S z =
0.493; p = 0.968) also indicates that the number of strategies used by management in
these two industry groups do not differ in their distribution.
 Table 12. Strategies Used By Management By Type of Union Affiliation
Independent Federated
%
(Over 48 %
No. of Firms) No. of (Over 42
Strategies Firms Rank Firms Firms) Rank
Examining meticulously the details of 24 50.00 1 28 66.67 1
each proposal
Background checking of the union's 22 45.83 2 21 50.00 3
negotiation panel
Offering a “package deal” to save on 21 43.75 3 23 54.76 2
labor costs
Offering the least as a counter 19 39.58 4 20 47.62 4
proposal
Explaining that the company is not 18 37.50 5 14 33.33 5
generating profit
Adding or subtracting a few 14 29.17 6 13 30.95 6
significant points in the
final minutes of the CBA
Not giving the true financial condition 9 18.75 7.5 10 23.81 8
of the company
Bluffing 7 14.58 9 12 28.57 7
Others (Please refer to Table 10 for 9 18.75 7.5 6 14.29 9.5
details)
Sending pro-management workers 4 8.33 10 6 14.29 9.5
during union meeting to spy
Harassing union negotiation panel 1 2.08 11 2 4.76 11
Members

Minimum Number of Strategies 1 1

Maximum Number of Strategies 9 9
Average Number of Strategies 3 4
5. Common Political and Economic Issues
The CBAs cover a variety of issues, which may be broadly categorized as:
political and economic. The political issues are those related to: (1)
coverage/scope; (2) union security; (3) job security or security of tenure (4) rights
and responsibilities of parties; (5) company rules and regulations; (6) management
prerogatives; (7) strikes/lockouts; (8) check off; (9) grievance procedure; (10)
disciplinary measures; (11) labor-management council/committee (12) union leave;
(13) union holiday-off; and (14) union assistance . The economic issues, on the other
hand, are those related to: (1) wages; (2) premiums; (3) allowances; (4) bonuses; (5)
hospitalization; (6) insurance; (7) retirement; (8) productivity incentives; (9) meal
subsidies; (10) uniforms; (11) promotions; and (12) leaves.

Based on this classification of CBA issues, the content analysis of the existing
contracts of the 90 unionized firms reveals a number of interesting patterns.

5.1 Economic Issues

On the major economic issues covered, all (100%) CBAs have wage
provisions which stipulate among others, across the board increases ranging from a
minimum of 10%/P150 per month, to a maximum of 15%/P2,200 per month with an
average of 13%/P786 per month for three years. One hundred percent (100%) of the
union contracts contain provisions on premiums mandated by law. These are
payment for services rendered for night duty, overtime, holiday and rest day. All
(100%) companies also have CBA provisions on vacation and sick leave benefits,
with a minimum entitlement of 10 days to a maximum of 21 days, or an average of 15
days per year. Other leaves such as emergency, birthday, bereavement and funeral,
are also manifested in 98% of the CBAs. These leaves range from one day up to 15
days with an average of seven days. The third most frequently (89%) negotiated
economic provision is hospitalization. This benefit gives at least P5,000 and as
much as P130,000, with an average of P40,879, per year. Bonus provisions are
included in 76% of the CBAs. This benefit is over and above the 13th month pay.
Workers receive at least one month to a maximum of four months with an average of
two months yearly bonus. Retirement provisions are also indicated in a considerable
number of contracts (71%). The retirement benefit is equivalent to 15 days’ to three
months’ pay with an average of one month salary per year of service. Allowances
provisions rank fifth (66%), with a minimum of P100 to P4,000, and an average of
P1,343 per month as employee allowance. The insurance provisions, on the other
hand, cover life insurance benefits for employees, ranging from P11,000 to
P600,000, with an average of P164,937. Uniform benefit is also stipulated in 60%
of the CBAs. Employees receive two sets/P500 to six sets/P6,000, with an average
of four sets/P1,922 per year. Meal subsidies are negotiated in 54% of the contracts.
Management subsidizes about P8.00 to P100 with an average of P41.00 per duty
meal. However, hotel and restaurant workers get free meals because of the nature of
their establishments.
 The least stipulated economic issues are on promotion (47%) and productivity
incentives (39%). Productivity incentives are computed differently in CBAs which
contain this provision. This is either based on percentage of sales or on actual peso
value. Further analysis of the 90 CBA on the economic issues illustrates that the
average number of negotiated provisions is 10, with a minimum of four and a
maximum of 14 (Refer to Table 13).

Table 13. Economic Issues Covered in the CBAs

Coverage*
No. of
Issues Minimum Maximum Average Firms % Rank
Wages 10% increase 15% increase 13% increase 90 100.00 2
annually annually annually
PHP 150.00 PHP 2,200.00 PHP 786.00
Premiums 90 100.00 2
a. Night + 15% + 55% + 31%
Differential
b. Overtime + 33% + 70% + 47%
c. Holiday Pay + 30% + 100% + 55%
d. Holiday-Rest + 50% + 80% + 62%
e. Rest day + 50% + 75% + 55%
Leaves (VL/SL) 10 Days 21 Days 15 Days 90 100.00 2
Other leaves 1 Day 15 days 7 Days 88 97.78 4
(Emergency,
Birthday etc.)
Hospitalization PHP 5,000.00 PHP 130,000 PHP 40,879 80 88.89 5
Bonuses 1 Month 4 Months 2 Months 68 75.56 6
Retirement 15 Days 3 Months 1 Month 64 71.11 7
Allowances PHP 100.00 PHP 4,000.00 PHP 1,343.00 59 65.56 8
Insurance plan PHP 16,000 PHP 600,000 PHP 164,937 58 64.44 9
Uniforms 2 Sets/ year 6 Sets/ year 4 Sets/ year 54 60.00 10
PHP 1,000.00 PHP 6,000.00 PHP 1,922.00
Meal subsidies PHP 8.00/ day PHP 100/ day PHP 41/day 49 54.44 11
Promotion 42 46.67 12
Productivity 35 38.89 13
Incentives
Signing bonus 2,500.00 15,000.00 6,625.00 12 13.33 14
1.5 months 2 months 1.5 months
salary Salary salary
Number of Issues 4 14 10
* For details, refer to Appendix 2

Grouped by type of industry, the manufacturing sector has as an average of

nine provisions with a minimum of fourand a maximum of 13. The non-
manufacturing group has an average of 11 provisions with a minimum of four and
 also a maximum of 14 (Refer to Table 14). The t-test (t=3.26; ρ=0.002) proved that
there is significant difference in the mean number of specific economic issues
stipulated in the CBAs based on the type of industry. The Mann Whitney test (z=-
3.1813; p =0.0015) and Kolmogorov Smirnov test (K-S z = 1.507; p = 0.021) further
confirmed this finding (Refer to Table 7). Also, the Spearman rank order correlation
coefficient (-0.3372; p = 0.001) implied that there is a linear relationship that exists
between the number of economic issues negotiated and the type of industry to which
the firm belongs. The data illustrate that economic benefits negotiated by unions in
the non-manufacturing sector are more compared to those in the manufacturing sector
and 34% of the variability in the number of economic provisions negotiated is
explained by the type of industry to which the companies belong.

Table 14. Economic Issues Covered in the CBAs by Type of Industry

Manufacturing Non- Manufacturing

%
No. of % No. of (48
Firms (42 Firms) Rank Firms Firms) Rank
Economic Issues
Wages 42 100.00 2 48 100.00 2.5
Premiums 42 100.00 2 48 100.00 2.5
A. Night Differential
B. Overtime
C. Holiday Pay
D. Holiday-Rest Day
E. Rest Day
Leaves 42 100.00 2 48 100.00 2.5
Other Leaves (Emergency, 40 95.24 4 48 100.00 2.5
Birthday, Bereavement,
Relocation Etc.)
Hospitalization 35 83.33 5 45 93.75 5
Bonuses 28 66.67 6 40 83.33 6
Retirement Plan 26 61.90 7 38 79.17 7.5
Allowances 21 50.00 10 38 79.17 7.5
Insurance Plan 22 52.38 9 36 75.00 9
Uniforms 24 57.14 8 30 62.50 11
Meal Subsidies 16 38.10 11 33 68.75 10
Promotion 15 35.71 12 27 56.25 12
Productivity Incentives 14 33.33 13 21 43.75 13
Signing Bonus 8 19.05 14 4 8.33 14

Minimum Number Of 4 4
Economic Issues
Maximum Number Of 13 14
Economic Issues
Average Number Of 9 11
Economic Issues
 By type of affiliation, the independent unions have an average of 10 provisions
with a minimum of four and a maximum of 14. The federated unions have also an average
of 10 provisions with at least five and as many as 13 (See Table 15). The t- test (t = -
0.39; p = 0.696) pinpoints that there is no significant difference in the mean number of
specific economic issues provided for in the CBAs based on the union affiliation. The
Mann-Whitney test (z= - .05684; p =0.5698) and Kolmogorov-Smirnov test (K-S z =
0.676; p = 0.751) further proved this result (See Table 7). The Spearman rank order
correlation value (0.602; p = 0.573) expressed that there is no significant relationship
between the number of economic issues negotiated and the type of union affiliation.

Table 15. Economic Issues Covered in the CBAs by Type of Union Affiliation

Independent Federated
No. Of %
Firms % No. Of (42
Economic Issues (48 Firms) Rank Firms Firms) Rank
Wages 48 100.00 2 42 100.00 2.5
Premiums 48 100.00 2 42 100.00 2.5
A. Night Differential
B. Overtime
C. Holiday Pay
D. Holiday-Rest Day
E. Rest Day
Leaves 48 100.00 2 42 100.00 2.5
Other Leaves (Emergency, 46 95.83 4 42 100.00 2.5
Birthday, Bereavement,
Relocation Etc.)
Hospitalization 42 87.50 5 38 90.48 5
Bonuses 32 66.67 6.5 36 85.71 6
Retirement Plan 32 66.67 6.5 32 76.19 7.5
Allowances 28 58.33 8 31 73.81 9
Insurance Plan 26 54.17 10 32 76.19 7.5
Uniforms 27 56.25 9 27 64.29 10
Meal Subsidies 25 52.08 11 24 57.14 11.5
Productivity Incentives 15 31.25 13 20 47.62 13
Promotion 18 37.50 12 24 57.14 11.5
Signing Bonus 4 8.33 14 8 19.05 14

Minimum Number of 4 5
Economic Issues
Maximum Number of 14 13
Economic Issues
Average Number of 10 10
Economic Issues
4.2 Political Issues

Going over the specific political issues covered in the 90 CBAs, some
noticeable trends exist. All (100%) contracts have a job security/security of tenure
provision which includes the classification of employees, grounds and procedures for
employee termination, and retrenchment of employees. The second most specified
issue (90%) is the grievance procedure which defines the mechanism for the
settlement of dispute and grievances arising from the interpretation and
implementation of the terms of the CBA. The grievance machinery includes the
definition and steps involved in the processing of grievance/s, who has the right to
present the grievance to the company and who is supposed to respond to this; the
number of days for the resolution of the complaint; and the voluntary arbitration
procedure. A majority (87%) of the CBAs also defines the coverage/scope of the
collective bargaining unit (CBU). It specifies the definition of the word
“employee/s” and the coverage of the collective bargaining unit (CBU), usually of the
regular rank-and-file employees, excluding those occupying “sensitive or
confidential” positions, like the secretary to the GM/President, HRD assistant,
assistant to the Controller. The union security issues are the fourth top priority (83%)
in the negotiation. This section seeks to preserve and protect the union’s existence
and effectiveness as an organization by ensuring its continued membership among
CBU employees, and efficient collection of dues and other assessments. The
common provision shown is either a maintenance of membership clause where
employees are given the option to join the union or not, but once they join, they are
required to continue their membership in good standing during the effectivity of the
CBA. Another is the union shop security clause where employees must join the
union within a specified period of time (usually 15-30 days from date of
regularization), as a condition for their continued employment.
Surprisingly, only 82% of the reviewed contracts contains a provision on
management prerogatives which emphasize the right of management to hire,
transfer, promote, assess performance, and conduct job standardization. The sixth
(6th) commonly included provision is the no strikes/lockouts clause. This section
stipulates the obligations of the union with regards to when a strike could be initiated
(e.g. on issues like union busting, and violation/s of CBA provisions). By the same
token it also stipulates what management should follow regarding lockouts. The
article on rights and responsibilities of parties is written in 71% of the CBAs. This
article confirms the rights of management, recognizes the rights and privileges of the
union and the obligations of both the union and management to implement in good
faith the agreed terms & conditions of employment, and comply with all the other
CBA provisions. The check off provision is guaranteed by 62% of the unions. This
issue is concerned with the employer’s regular deduction from the employees’
salaries the amounts corresponding to their union dues, strike fund contributions,
fines, agency fees, and other special assessments and remit these to the union.
The least stipulated political provisions are those related to labor-
management council/committee (42%) and disciplinary measures (34%). The
labor-management committee (or LMC) article specifies its objective to serve as a
venue to solve problems affecting employees and management, and its mechanisms,
 including its composition of management and union representatives and the frequency
of its meeting. The disciplinary measures sections, on one hand, generally list the
offenses that may be committed by the employees and their corresponding sanctions
after due process. Lastly, as part of the political issue classification, the CBAs
contain provisions on union assistance (21%) which come in the form of
educational fund , loan, assistance to cooperative, signing privilege, and support for
union activities. This union benefit costs at least P 10,000 to P 150,000 or an average
of P 75,000 a year.

Table 19. Political Issues Covered in the CBA

No. of
Issues Coverage Firms % Rank

Job security/ Classification of Employment, Dismissal 90 100.00 1.5

security of and Due Process, Retrenchment
tenure
Company rules and Wearing of Uniform, Grace Periods, Meal 90 100.00 1.5
regulations Breaks, Working Hours
Grievance Committee/Governing Body, Procedure 81 90.00 3
machinery
Coverage/scope Definition of Employees, Bargaining 78 86.67 4
Unit, Coverage of Agreement
Union security Union/Maintenance Shop, Security 75 83.33 5
against Dismissal, Coercion, Intimidation
In joining union, Communication on
Status of Negotiation
Management Employee Hiring, Transfer and Promotion, 74 82.22 6
prerogatives Job Standardization, Evaluation
Strikes/lockouts No Strike/No Lockout Clause 68 75.56 7
Rights and Right of management to supervise, hire, evaluate, 64 71.11 8
responsibilities train, dismiss, maintain
of parties standards. Right of union to communicate,
investigate grievances, conduct meetings, have
free access to company premises for federation
representatives, have a bulletin board and office
inside company premises
Table 19. Continued

NO. OF
Issues Coverage Firms % Rank
Check-off Schedule of Check-off, Notices, 56 62.22 9
Remittance
Union leave Minimum : 40 Days 55 61.11 10
Maximum: 275 Days
Average : 145 Days
Labor-management Committee Composition, Objectives, 38 42.22 11
committee Responsibilities
Disciplinary Code of Discipline, Penalties, Due Process 31 34.44 12
measures
Union assistance Minimum : PHP 10,000.00 19 21.11 13
(educational Maximum: PHP 150,000.00
fund, loan,
assistance to
Cooperative,
signing privilege,
Union holiday off 2 Days 8 8.89 14

Minimum number 3
of political issues
Maximum number of 14
political issues
Average number of 8
political issues
Covered in CBA

The analysis of the major political issues covered by the CBAs reveals that the
average number of issues negotiated is eight, with a minimum of three and a maximum of 14.
Classified by type of industry, the manufacturing sector has an average of 9 provisions, with
three as the lowest and 12 as the highest number of such provisions. The non-
manufacturing unions were able to negotiate an average of eight political demands from a
minimum of four and a maximum of 14 (Refer to Table 20). The t-test value (t=-0.65;
ρ=0.516) revealed that there is no significant difference in the number of political demands
negotiated by type of industry. This is further confirmed by the Mann-Whitney U test (z=
0.8689; p = 0.3849) and the Kolmogorov-Smirnov test (K-S z = 0.831; p = 0.495). Neither is
there a correlation between the number of political issues covered and the type of industry,
based on the Spearman rank order correlation (0.0921; p = 0.388).
Table 20. Political Issues Covered in the CBAs By Type of Industry

NON-
MANUFACTURING MANUFACTURING
% No. of %
No. Of (42 Rank Firms (48 Rank
Issues Firms Firms) Firms)
Job security/security of tenure 42 100.00 2 48 100.00 1.5
Company rules and regulations 42 100.00 2 48 100.00 1.5
Grievance machinery 42 100.00 2 39 81.25 3
Coverage/scope 41 97.62 5 37 77.08 4
Union security 41 97.62 5 34 70.83 5
Management prerogatives 41 97.62 5 33 68.75 6
Strikes/lockouts 37 88.10 7 31 64.58 7
Rights and responsibilities of 34 80.95 8 30 62.50 8
parties
Check-off 32 76.19 9 24 50.00 10
Union leave 29 69.05 10 26 54.17 9
Labor-management committee 20 47.62 11 18 37.50 11
Disciplinary measures 15 35.71 12 16 33.33 12
Union assistance (educational 9 21.43 13 10 20.83 13
fund, loan, assistance to
cooperative, Signing Privilege,
support for Union Activities)
Union Holiday off 2 4.76 14 6 12.50 14

Minimum number of Political 3 4

issues covered
Maximum number of Political 12 14
Issues covered
Average number of Political issues 9 8
Table 21. Political Issues Covered in the CBAs By Type of Union Affiliation

Independent Federated
No. of % Rank No. of % Rank
Issues Firms (48 Firms) Firms (42 Firms)
Job security/security of tenure 48 100.00 1 42 100.00 1
Company rules and regulations 16 33.33 9 14 33.33 13
Grievance machinery 41 85.42 3.5 40 95.24 3
Coverage/scope 41 85.42 3.5 37 88.10 6
Union security 35 72.92 5 40 95.24 3
Management prerogatives 42 87.50 2 32 76.19 7.5
Strikes/lockouts 30 62.50 7 38 90.48 5
Rights and responsibilities of 32 66.67 6 32 76.19 7.5
parties
Check-off 29 60.42 8 27 64.29 9.5
Union leave 15 31.25 10 40 95.24 3
Labor-management committee 11 22.92 12 27 64.29 9.5
Disciplinary measures 13 27.08 11 18 42.86 11
Union assistance (educational 4 8.33 13.5 15 35.71 12
fund, loan assistance to
cooperative, signing
privilege, support for union
activities)
Union Holiday off 4 8.33 13.5 4 9.52 14

Minimum number of Political 3 4

Issues
Maximum number of Political 12 14
Issues
Average number of Political 7 10
Issues
 When analyzed by type of union affiliation, the independent unions only were able to
secure in their CBAs an average of seven political demands, with a minimum three and as
many as 12. On the other hand, the federated unions were able to bargain for a higher
average of 10 political provisions with a minimum pegged at four and the maximum at 14.
The t-test (t=-5.37; p = 0.000) , Mann- Whitney U test (z = -4.9118; p = 0.000), and
Kolmogorov-Smirnov test (K-S z = 2.507; p = 0.000) computation results all indicate that
there is a significant difference in the number of political issues negotiated by type of
union affiliation. The Spearman rank order correlation value (0.5206; p = 0.000) verified
that there is a significant relationship between the number of political issues bargained and
the type of union affiliation. The information clearly illustrates that there are more political
issues negotiated by federated unions compared to the independent unions, and 52% of the
variability in the number of political provisions bargained is explained by the type of union
affiliation.

6. Problems Encountered During CBA Negotiations

Mondy and Noe (1981) opined that diversity is probably the key characteristic of
collective bargaining. As such, the negotiation process is affected by the differing attitudes
and goals of the union and management toward the main issues under discussion. When the
negotiating parties are in the distributive bargaining strategy framework which is defined
by Ballot (1992) as the “set of strategies, tactics, and activities utilized by negotiators
when their goals or objectives are in direct conflict,” difficulties or problems are bound to
be encountered.
When asked regarding the problems experienced by the union during CBA
negotiations, a number of specific difficulties were enumerated by the union officers as
presented in Table 22.
The most prevalent (41%) concern was the “lack of skills for negotiation.” The other
noticeable (39%) constraint as perceived by the union was the “conflicts related to panel
composition.” The union also experienced difficulties due to the “lack of willingeness to
compromise” and “inadequate organizational capability” (32%).
On the other hand, the management representatives identified fewer problems
compared to the union. As manifested in Table 22, they ranked the “lack of willingness to
compromise” at the top (55%) of the list. This was followed by the “lack of skills for
negotiation” and “use of power play tactics” (21%).
Over-all, the most frequently (42%) cited problem by both parties is the “lack of
willingness to compromise”.
Table 22. Problems Encountered by Union and Management
Union Management Over-All
% %
No. of (44 Resp) No. of (33 Resp) No. of %
Firms Rank Firms Rank Firms (77 Resp) Rank
Problems

I Conflicts Related to Panel Composition 17 38.64 2 6 18.18 4 23 29.87 3

?Management panel members do not have power

and authority to decide
? Absence of owners during negotiation, represented
only by managers and counsel
? Newly-hired manager included in panel
? Exclusion of Federation President in panel
? Lawyers included in the panel makes period of
negotiation long
? Legal counsel of union prolongs and affects
negotiation
? Intervention of lawyers included in panel

II Negotiators Lack Skills for Negotiation 18 40.91 1 7 21.21 2.5 25 32.47 2

? ?Lack of education on CBA technicalities/skills

? Inexperience in negotiation of some union panelists
? ?Some union panel members do not understand the
The purpose of the negotiation and just air their gripes
Table 22.Continued

Union Management Over-All

% %
No. of (44 Resp) No. of (33 Resp) No. of %
Problems Firms Rank Firms Rank Firms (77 Resp) Rank

?D ? ifficulty in justifying demands/proposals

? ?Difficulty in understanding Management/Union
Positions

III Non-Availability of Accurate 6 13.64 7 1 3.03 8 7 9.09 9

Information to Make Informed Decision

? Absence of accurate information on company's

financial condition
? Difficulty in assessing company's real financial
standing
? Financial statements are fake
?Management not showing true financial condition
? Different data/facts presented by both parties
? Incomplete facts and data to present union proposals

IV Lack of Focus in Negotiations 11 25.00 5 3 9.09 6 14 18.18 5

? Delays due to schedule of panelists

? Poor management attendance
? Delay by Managers who has to attend to some work
?Managers always on call during negotiations
Table 22.Continued

Union Management Over-All

% %
No. of (44 Resp) No. of (33 Resp) No. of
Problems Firms Rank Firms Rank Firms % Rank

V Lack of Willingness to Compromise 14 31.82 3.5 18 54.55 1 32 41.56 1

? Closed mind of management

? Hardline attitude of management/union
? Hardline position of management/union
? No one wants to compromise
? Unreasonable proposals/counter proposals
? Disagreement on certain proposals

VI Economic Constraints During 5 11.36 8 4 12.12 5 9 11.69 8

Negotiations

? Company has poor financial condition due to crisis

? Difficult to bargain if the company is not doing well
? Wage orders declared during negotiations
? Peso devaluated resulting on loss - difficulty in
explaining to union

VII Lack of Sincerity 10 22.73 6 10 12.99 7

?Management uses delaying tactics
?Management is bluffing
Table 22.Continued

Union Management Over-All

% % %
No. of (44 Resp) No. of (33 Resp) No. of (77 Resp)
Firms Rank Firms Rank Firms Rank
Problems

? Disinformation tactics by management

?Management panel members not honest and
transparent
?Some management panel members only want chair-
man's attention
?Management too friendly with union panel
? Dimunition of benefits already negotiated

VIII Use of Power Play Tactics 4 9.09 9 7 21.21 2.5 11 14.29 6

? Political harassment on union members by

Personnel Manager
? Pressure caused by Supervisor-Rank and File
relationship
? Union threatens strike
? Acts of agitation by members during negotiation
? Disobedience campaign promoted by not wearing
uniform
?Management has big influence in government and
Media
Table 22.Continued

Union Management Over-All

% % %
No. of (44 Resp) No. of (33 Resp) No. of (77
Firms Rank Firms Rank Firms Resp) Rank
Problems

IX Inadequate Organizational Capability 14 31.82 3.5 2 6.06 7 16 20.78 4

? Lack of preparation on union strategies

? Union lacks funds for negotiations
? There are financial constraints for union officers
? Lack of committed union officers
? Lack of information among members
? Lack of information dissemination
? Inability of officers to communicate negotiation
status to members resulting in confusion

Total 99 48 147
7. Factors of Success Experienced in CBA Negotiations

It is imperative that an effective collective bargaining negotiation process be

established in order that meaningful results/outcomes, which are truly relevant and beneficial
to both parties, could be mutually agreed upon. Therefore, there are a number of factors that
should be present in the collective bargaining process to ensure its success.
Out of the nine enumerated success factors, both union and management
representatives indicated experiencing an average of seven factors, with a minimum of three
for union and two for management. The top three most frequently checked items by the
respondents in the list of factors of success experienced were: (1) “trust between parties” ( 84
%), (2) “confidence of the members in their representatives in the negotiations” (83%), and
(3) “open and honest communication” (83%). (Refer to Table 23)
The average number of success factors experienced by the union and
( X = 7 )
management when they were grouped by industry, was the same for the manufacturing and
non-manufacturing establishments. The same result was also obtained when they were
classified by union affiliation. The statistical values (as presented in Table 7) proved that
there is no significant difference in the number of success factors experienced in the CBA
negotiations by union and management panels. There is also no difference when the number
of success factors are classified by type of industry and type of union affiliation. The
Spearman rank order correlation test also showed that there is no significant relationship
that exists between the number of success factors experienced in the CBA negotiations and
the type of industry and union affiliation.

Table 23. Success Factors for Management and Union

Union Management Over-All
No. of No. of No. of
Firms % Firms % Firms %
Success Factors Rank Rank Rank

Trust between parties 74 82.22 3 78 86.67 1 152 84.44 1

Confidence of the members 75 83.33 1.5 75 83.33 2.5 150 83.33 2.5
In their representatives in
the negotiations
Open and honest 75 83.33 1.5 75 83.33 2.5 150 83.33 2.5
Communication
Group participation 72 80.00 4 69 76.67 5 141 78.33 4.5
Negotiators must possess 69 76.67 5 72 80.00 4 141 78.33 4.5
the required skills for
negotiation
Establishment of clear 68 75.56 6 65 72.22 6 133 73.89 6
procedures and group
Rules for negotiation
The resolution of conflicts 58 64.44 7 58 64.44 7.5 116 64.44 7
during negotiation
Table 23. Continued
Union Management Over-All
No. of No. of No. of
Firms % Firms % Firms %
Success Factors Rank Rank Rank

Accessibility of information 57 63.33 8.5 58 64.44 7.5 115 63.89 8.5

to make informed
decisions
Use of the problem-solving 57 63.33 8.5 57 63.33 9 114 63.33 8.5
team approach to identify
issues and come up with
options to discuss
during negotiations

Minimum No. Of Success 3 2 2

Factors
Maximum No. Of Success 9 9 9
Factors
Average Number Of 7 7 7
Success Factors

Table 24. Success Factors for Management and Union by Type of Industry
Manufacturing Non- Manufacturing
No. of No. of
Rank Rank
Success Factors Firms % Firms %

Trust between parties 79 87.78 1 73 81.11 5

Confidence of the members in their 74 82.22 2 76 84.44 1
representatives in the negotiations
Open and honest communication 73 81.11 3 77 85.56 2
Group participation 66 73.33 5 75 83.33 3.5
Negotiators must possess the 72 80.00 4 69 76.67 6
required skills for negotiation
Establishment of clear procedures 58 64.44 6 75 83.33 3.5
and group rules for negotiation
The resolution of conflicts during 52 57.78 8 64 71.11 7
negotiation
Accessibility of information to make 51 56.67 9 64 71.11 8
informed decisions
Use of the problem-solving team 56 62.22 7 58 64.44 9
approach to identify issues and
come up with options to discuss
during negotiations

Minimum No. of Success Factors 2 2

Maximum No. of Success Factors 9 9
Average Number of Success 7 7
Factors Experienced
Table 25. Success Factors for Management and Union By
Type of Union Affiliation
Independent Federated
No. of No. of
Rank Rank
Success Factors Firms % Firms %
Trust between parties 73 81.11 2 73 81.11 3
Confidence of the members in their 76 84.44 1 74 82.22 2
representatives in the negotiations
Open and honest communication 71 78.89 4 75 83.33 1
Group participation 72 80.00 3 69 76.67 5
Negotiators must possess the 70 77.78 5.5 71 78.89 4
required skills for negotiation
Establishment of clear procedures 70 77.78 5.5 63 70.00 6
and group rules for negotiation
The resolution of conflicts during 56 62.22 9 60 66.67 7
negotiation
Accessibility of information to make 60 66.67 8 54 60.00 8
informed decisions
Use of the problem-solving team 67 74.44 7 47 52.22 9
approach to identify issues and
come up with options to discuss
during negotiations
Minimum No. of Success Factors 2 2
Maximum No. of Success Factors 9 9
Average Number of Success Factors 7 7
8. Conclusion

Although the Philippine Labor Code guarantees the right to collective

bargaining to workers through their trade unions, and stipulates the procedures for the
administration of collective bargaining agreements, the collective bargaining process
remains to be a time-consuming and complicated encounter between management and
union.
It becomes time-consuming because of the length involved in preparing the
proposals and counter proposals, the long hours spent during negotiations which is
stretched over an average of nine (9) months, and the monitoring of the
implementation of the CBA which is for a period of three-five years.
It is complicated because of the varying strategies and tactics used by both
parties in the pre-negotiation and actual negotiation stages of the collective
bargaining process. The composition of the respective panels of negotiators add to
the complexity of the process, particularly the presence of a lawyer which makes it
even more legalistic. The differing attitudes and goals of the panel members might
have dictated the number and types of specific strategies each party employ in the
entire process of the bargaining.
Since the negotiating parties are in the distributive bargaining strategy
framework, they encountered several problems during the negotiations. The union
expressed more difficulties than management and the most prevalent concern was the
lack of skills for negotiations while management cited the lack to willingness of the
union to compromise.
However, the type of industry to which the company belongs, and the union’s
membership in a federation, have no correlation with the numbers of strategies and
success factors identified by both union and management. These two realities also did
not lead to any significant differences in the number of strategies employed by the
parties and the member of success factors experienced by both panel of negotiation..
The actual CBA political and economic provisions are focused primarily on
wages, benefits, and other terms and conditions of employment in the bargaining unit,
including mandatory provisions for grievance. The number of economic issues
negotiated by the union are significantly different according to the type of industry.
The unions in the non-manufacturing sector were able to get more than the
manufacturing industry.
On the other hand, number of political issues bargained by the federated
unions are significantly different from the independent unions. They are able to get
more than the unions which are independent. These provisions are related to union
leave, union security, and union assistance.
Lastly, both management and union have the same perception on the factors
that will contribute to the success of the collective bargaining process. The foremost
of which is trust between parties.

“While so much has been done in recent years to identify and reduce
some of the prime causes of industrial conflict, the future depends on the
will of management and trade unions to resolve issues which may divide
them and to develop more constructive relationships.” (ACAS leaflet
Improving Industrial Relations, 1985)
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