Collective Bargaining: What U.S. Employers Must Know to Stay Compliant
If you employ (or may soon employ) a union-represented workforce, you’re likely looking for a clear, compliance-focused explanation of collective bargaining—what it is, what federal law requires, and what practical steps HR and leadership should take to avoid unfair labor practice risk. This guide from SwiftSDS covers the collective bargaining definition (U.S. history and current law), the right of collective bargaining, and how collective bargaining agreement law impacts day-to-day workplace decisions.
What Is Collective Bargaining?
Collective bargaining is the legally protected process where an employer and employees’ chosen representative (typically a labor union) negotiate over wages, hours, and other terms and conditions of employment.
Collective bargaining definition (U.S. history and today)
In U.S. history, modern collective bargaining is most closely associated with the National Labor Relations Act (NLRA) of 1935 (also called the Wagner Act). The NLRA established employees’ rights to organize and bargain collectively and created the National Labor Relations Board (NLRB) to enforce those rights.
Today, for most private-sector employers, the rules of collective bargaining are still rooted in the NLRA. Public-sector bargaining is generally governed by state laws and agency rules rather than the NLRA.
For broader context on the federal framework behind these rights, SwiftSDS maintains an employment legislation list that summarizes major federal labor law requirements and where they typically apply.
The Right of Collective Bargaining Under Federal Law
Section 7 rights and protected activity
Under Section 7 of the NLRA, many private-sector employees have the right of collective bargaining through representatives of their own choosing. Section 7 also protects “concerted activities” for mutual aid or protection—meaning employees can act together to raise workplace concerns even if they are not unionized.
SwiftSDS also summarizes related employee protections in 5 rights of workers, which can help HR teams align policies (handbooks, discipline, communications) with protected rights.
What employers must do: the duty to bargain in good faith
Once a union is certified or voluntarily recognized as the bargaining representative, the employer has a legal duty to bargain in good faith (NLRA Section 8(a)(5)). Good faith bargaining generally means:
- Meeting at reasonable times and places
- Exchanging proposals and counterproposals
- Providing relevant information upon request (when required)
- Avoiding unilateral changes to mandatory bargaining subjects without bargaining to agreement or lawful impasse
Failing to bargain in good faith can lead to an unfair labor practice (ULP) charge at the NLRB.
Mandatory vs. Permissive vs. Illegal Subjects of Bargaining
Understanding what must be negotiated is one of the most actionable compliance steps HR can take.
Mandatory subjects (must bargain)
These include wages, hours, and other terms and conditions of employment, such as:
- Pay rates, shift differentials, bonuses (in many cases)
- Scheduling, overtime rules, breaks
- Work rules, discipline procedures, attendance policies
- Safety rules and protective equipment expectations (where they affect terms/conditions)
- Seniority, bidding, transfers, layoffs/recall
- Benefits (health, retirement) and some leave policies
Because wage-and-hour compliance often overlaps with bargaining topics, ensure your posted wage-and-hour notices are current, including the U.S. DOL’s Employee Rights Under the Fair Labor Standards Act (or the applicable version for your industry).
Permissive subjects (may bargain, not required)
Parties may negotiate, but neither side can insist to impasse, on topics such as:
- Internal union matters
- Bargaining unit scope proposals (often complex and case-specific)
- Certain management-rights expansions beyond mandatory topics
Illegal subjects (cannot bargain)
Terms that violate law cannot be enforced even if agreed to. For example:
- Discriminatory provisions that conflict with federal EEO law
SwiftSDS covers discrimination compliance in banned discrimination and the role of equal employment standards in as it pertains to employment opportunity the eeo strives to.
Collective Bargaining Agreement (CBA) Law: What a CBA Does in Practice
A collective bargaining agreement (often called a CBA or “contract”) is the written outcome of collective bargaining. From a compliance standpoint, the CBA becomes a critical governing document that HR must treat as operationally binding.
What a CBA usually includes
Most collective agreements address:
- Pay structures and progression
- Scheduling rules, overtime distribution, shift assignments
- Grievance and arbitration procedures
- Just-cause or disciplinary standards
- Seniority and job posting/bidding
- Leave rules and call-in procedures
- Management rights clauses
- Duration, reopener clauses, and successor bargaining provisions
Actionable HR steps once a CBA is in place
To reduce risk of grievances and ULP allegations:
- Train managers on CBA requirements (especially discipline, scheduling, and overtime).
- Create a “CBA compliance checklist” for routine actions: shift changes, job reassignments, policy rollouts, attendance enforcement.
- Centralize interpretations: designate HR/labor relations as the owner of “what the contract means” to avoid inconsistent supervisor decisions.
- Document bargaining history and past practice—arbitrators often rely on both.
Avoiding Common Compliance Pitfalls During Collective Bargaining
1) Unilateral changes
A frequent violation occurs when an employer makes unilateral changes to a mandatory subject (e.g., schedules, incentives, attendance rules) after the union relationship is established and before lawful impasse. Implement a workflow so operational leaders route proposed changes through HR/labor counsel.
2) Misclassifying workers (employees vs. contractors)
NLRA coverage generally applies to “employees,” not certain independent contractors (though classification disputes are common). If your workforce includes contractors, align your labor strategy with proper classification analysis. SwiftSDS discusses a related classification issue in are contractors eligible for fmla (different law, similar risk: misclassification leads to compliance exposure).
3) Ignoring disability accommodation overlap
Unionized workplaces still must comply with the ADA. Accommodation requests may intersect with seniority, job bidding, and essential functions. Keep ADA documentation and interactive process practices current using SwiftSDS resources on ada hr and ada forms for employers.
4) Confusing “right to work” with the right to bargain
“Right to work” laws are state-level rules about union security and dues requirements; they do not eliminate the federal duty to bargain where the NLRA applies. If you operate in California, review SwiftSDS guidance on California right to work law to avoid policy misunderstandings across locations.
Posting and Notice Compliance: Don’t Overlook the Basics
Collective bargaining doesn’t replace baseline labor standards. Employers still must comply with notice-posting obligations applicable to their workforce.
- For most employers, keep the DOL FLSA posting current: Employee Rights Under the Fair Labor Standards Act
- For Spanish-language workforce needs, also consider: Derechos de los Trabajadores Bajo la Ley de Normas Justas de Trabajo (FLSA)
- For agriculture or public-sector variants, use the applicable version: FLSA – Agriculture and FLSA – State and Local Government
If you operate in Massachusetts, confirm state posting compliance as well, such as Massachusetts Wage & Hour Laws and Fair Employment in Massachusetts.
FAQ: Collective Bargaining for Employers
Is collective bargaining required for every business?
No. The NLRA generally applies to many private-sector employers, but not all workplaces are unionized, and certain categories of workers/employers have different rules or exclusions. If a union is lawfully chosen/recognized for an appropriate unit, the employer has a duty to bargain in good faith.
What triggers the duty to bargain in good faith?
Typically, the duty arises after the union is certified by the NLRB or voluntarily recognized by the employer as the employees’ representative. After that point, avoid unilateral changes to mandatory bargaining subjects without bargaining.
Can a collective bargaining agreement override federal employment laws?
No. A CBA can provide greater protections or benefits, but it generally cannot waive or reduce statutory rights in a way that violates federal law (for example, anti-discrimination requirements). Maintain alignment with core federal requirements listed in SwiftSDS’s employment legislation list.
Next step for compliance: If you’re preparing for negotiations or managing a union contract, inventory your policies and postings, train supervisors on contract-sensitive decisions, and implement an HR review process for any change affecting wages, hours, or working conditions.