WHAT IS THE LEGAL STATUS OF COLLECTIVE AGREEMENT?

Collective agreement requires a minimum of two parties, to wit: the trade union of employees and either an employer or an association of employers.

CHAMAN LAW FIRM

6/7/2022 0 min read

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WHAT IS THE LEGAL STATUS OF COLLECTIVE AGREEMENT

Collective agreement involves the machinery for consultation regarding the settlement of terms, conditions of employment, procedures or stages which the collective parties to the bargaining must or ought to exhaust before embarking on an industrial action and dismissal procedures. Collective agreement requires a minimum of two parties, to wit: the trade union of employees and either an employer or an association of employers.

It is trite that the legal significance of a collective agreement has always been undetermined. Some courts in Nigeria have called it a mere gentlemen's agreement, unenforceable at law. It has as well been likened to a treaty between parties that becomes enforceable by the parties themselves taking steps to execute it and give it the characteristics of a legally enforceable document.

A collective agreement is presumed not to be a legally enforceable contract by the parties, unless the agreement is in writing and contains a provision that the parties intend for it to be legally enforceable. The parties may declare that only one or more parts of the agreement are intended to be legally enforceable. It should not be assumed that a collective agreement is legally binding simply because it declares the parties intention to create legal relations due to the existence of vague or uncertain contracts. Then, the question emerges on whether collective agreements are legally enforceable contracts or are they only binding in based on mutual respect.

Several judicial pronouncements have been made on this issue but the notable one is Ford Motor Co.Ltd V. Amalgamated Union of Engineering And Foundry Workers (1968) 2.Q.B.303, where it was held amongst other things that collective agreements themselves cannot be termed as contracts in law as the parties do not intend to be legally bound by it.

The primary law governing trade disputes in Nigeria is the Trade Unions Act. However, the general purpose of this provision of the law is that any collective agreement between two trade unions may constitute a valid contract where the parties so intend. In essence, the ingredient to be considered in circumstances where the question of the ability to bind and the enforceability of agreement between two trade unions arise is that of intention of the parties and the statute books.

Simply, a collective agreement has to do with any wages, hours, benefits, rules or working conditions that have been mutually agreed upon. Statutorily, a collective agreement is defined as any agreement or arrangement made by or on behalf of one or more trade unions and one or more employers, or employers’ associations, which relates to one or more of the matters as stipulated in the law. Notably, an employer can incorporate the contract of employment between the employee and employer through express incorporation, implied incorporation and incorporation by statutes as the case may be.

NB: This article is not a legal advice, and under no circumstance should you take it as such. All information provided are for general purpose only. For information, please contact chamanlawfirm@gmail.com

WRITTEN BY CHAMAN LAW FIRM TEAM

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