It is worth mentioning that the primary objective of unions is to represent employees in matters regarding welfare, pay, and benefits. However, it is hard to achieve a collective agreement due to different factors between employers and worker. Economically, unions negotiate higher pay for their members. The pay rise lowers the profit earned by the employers. Consequently, the business owners are forced to increase prices of their products (Oswald, 1985). On the same note, legal factors also affect negotiations as there exist some statutes that affect the negotiation process. For this reason, the unions and employers must make sure that the agreements are in line with these laws. Additionally, unions have a right to a strike. Hence, companies are forced to comply with the demand of the unions to avoid industrial action.
In essence, political factors also have a significant influence on the negotiation process. Notably, the trade union officials pass through the elective process. If the employees are not pleased by their actions, they may not be re-elected again. During this process, the officials will try harder to make sure that their demands are met so that they can increase their chances of being re-elected. The management has to comply or come up with another offer that will help the negotiation process. Additionally, the administration will meet to avoid stoppage of work. Social factors significantly affect the negotiation process.
References
Oswald, A. J. (1985). The economic theory of trade unions: An introductory survey. The Scandinavian Journal of Economics, 160-193.
