Collective Bargaining Agent And Donovan Commission Report – Part II

Collective Bargaining Agent And Donovan Commission Report – Part II

Collective Bargaining and United States of America

In American, Collective Bargaining Agent has a long history and it was not recognized until the 20th century. In a famous case[1] wherein shoemakers joined together and fixed the price for their labor and refused to work for any employer who does not pay the fixed price the Court decided that their collective action was unnatural and constituted criminal conspiracy and inflicts harm to the public.[2] This idea remained in force till the end of 19th century wherein another case[3] favored the workers’ rights and decided that Collective Bargaining can be tolerated as far as unions remain peaceful.

In 20th century American society began to federal legislate to address the emerging labor related issues and wish to develop a unified federal law of Collective Bargaining with regard to private sector.[4] Now there are three distinctive regimes of Collective Bargaining Agent; one for the Railroad and Airline Industries; one for rest of the private sector and one for the Public Sector. To prevent conflict between management and unions, the Congress had enacted Railway Labor Act 1926 and in 1936 Congress also applied RLA to the Airlines Industry as it declared similar nature because of same service of transportation industry. Today, there are 500,000 employees are of Airlines and 250,000 are of Railway Industry are covered by this Act. Collective agreements cover 60% of Airlines and 90% of Railway Industry.[5]

The Railway Labor Act created an elaborative system of bargaining, mediation conciliation, fact-finding arbitration. For this purpose a board was constituted namely National Mediation Board and three members were to be appointed by the US President. No strike occurs unless the NMB releases the parties and this process takes years and was considered beneficial for the union because during this period, the terms and conditions of agreement are enlarged. Thus union/workers feel this process in their favor. Even if NMB releases the parties, the President has the authority to ask workers to go back to work. This aspect is also considered in favor of workers because they felt benefited by the Congress as compare to employers.[6]

In 1935, the Congress adopted the National Labor Relations Act (NLRA) covering largely the private sectors’ workers outside the Railway and Airlines industry and subsequently a National Relations Labor Board (NLRB) was also constituted to regulate and implement the Act. The NLRA created a collective barging system which covers, among other, unfair labor practice, bargaining unit, majority Rule, certification, exclusive representation, duty to bargain, written agreement for specific term, voluntary mediation, impasse, strikes and lockouts and strike replacement.

Legal and Constitutional sanction of CBA, ILO Convention No.98 of 1949.

The Constitution of Pakistan under Article 17 guarantees the formation of Association and Trade Unions. It is mentioned under the Chapter of Fundamental Rights.[7]The freedom of association is one of the pillars of democracy, how can a democracy stand on its feet or develop in any society without the freedom of association.[8] These are the reasons that International Community has included this freedom in International Convention on Civil and Political Rights 1966 under Article 22[9] and European Convention Human Rights has included in it under Article 11.

In Civil Aviation Authority v Officers Association of CAA case[10], Justice Ajmal Mian has elaborated the importance of trade union. The trade union and its registration to become a legal entity and get the status of Collective Bargaining Agent, the law governing the industrial relations are to be followed. An unregistered union cannot legally enter into settlement/contracts with the management of employers. Therefore, it is mandatory that a union be registered and get the Certificate to become a Collective Bargaining Agent to represent the workers of an establishment.[11]

Brief facts of the case is that employees had formed union and registered on 16th September 1969. After Industrial Relations Ordinance 1969 was enforced the union once again registered in 1980. The government enforced Civil Aviation Authority Ordinance 1982, it took many steps, among them was to ban unions in Civil Aviation. The Civil Aviation Employees’ Union took the matter in the court and the court decided that implementation of Article 17 (1) is necessary and therefore the union should  not only be  allowed to work but also provided with the atmosphere where they can work in freedom, enabling them to work as Collective Bargaining Agent for the interest of the workers. The court further observed that government provide legislation through IRO or any other instrument to safeguard the freedom guaranteed by Article 17 of the Constitution.[12]

International Labor Organization(ILO) has issued a detailed guidelines for the labor class and in 1949 ILO issued Convention NO.98 which recognized the right to Organize and Collective Bargaining.[13] This Convention No.98 was also ratified by Pakistan in 1952. Collective Bargaining Agent has been adequately protected by this ILO Convention No.98. This Convention protects the right of CBA and employers.[14] It bars intervention in the affairs of each other. The ultimate purpose of this Convention No.98 is to provide maximum protection to the workers and force all signatories’ governments to legislate for the workers in the light of this convention so that workers exploitation could be eliminated from the society.[15]

Section 22 (1) of IRO 1969 provides the recognition and procedure for CBA but in consequence of 18th Amendment Act 2010, the Labour issues have devolved to the provinces. The Punjab government legislated Punjab Industrial Relations Act (PIRA) 2010.  Section 24 of this Act recognized and provides the procedure of declaring trade union and CBA in more detailed manner as compare to its predecessor Section 22 (1) of IRO 1969. The province of Punjab though provided some relief by one hand but taken away by other hand. For example, by virtue of Section 48 of PIRA 2010, the rule of CBA has been diminished and workers direct role has been assigned. This actually weakened the workers’ position of bargaining.[16]

In recent years Pakistan has been granted a GSP Plus status but unfortunately neither federal government nor provincial government had taken any concrete measure to protect the workers’ right. These days GSP Plus Review is due, therefore government, particularly provincial government has taken some steps to eliminate exploitative practice against workers.[17] The Punjab government in its draft Labour Policy has introduced some measure where CBA will be recognized and a participatory economic activity shall be ensured but this draft policy has not been presented in the Punjab Assembly to make it an Act.[18] This Act also made a horrible thing with regard to trade union and that is when office bearers is found in criminal case and his membership is struck off, consequently, this is one of the causes to cancel a Registered Trade Union, among other conditions.[19] Therefore through these measures, the government of Punjab has restricted the benefits of workers.

Mr. Zahoor Awan, while criticizing to government which does not implement the ILO Conventions especially ILO No.98 which empowers the unions and employers to safeguard the workers’ interest. The Pakistan Workers Confederation (PWC) presented a report to European Union for asking government to implement the ILO Conventions which is related to Labor issues. Pakistan got GSP Plus status and is obligated to comply with the ILO Convention related to Human Rights of Labor class. The report vehemently criticized that government is not implementing the ILO Conventions, for Trade Union and Collective Bargaining Agent issues are still unfulfilled.[20] The said report, apart from recommendation in the name of The Way Forward, had ended with a strong conclusion on the importance of Collective Bargaining Agent and Unions which is reproduced herein under:

“Collective Bargaining without union is impossible. Without bargaining the economic and commercial benefit of GSP Plus cannot be shared with workers and Pakistan’s Citizens. To begin with, the additional profits of exporters under GSP Plus must start to reach workers in the export sector industry in particular, textile and garments sectors – without any further delay. Hence, the formation and freedom of representatives workers’ union in the textile and garment sectors will be the litmus test for the success of the GSP Plus Scheme.”[21]

Case Study of CBA in HBFC in Pakistan

To understand the role of Collective Bargaining Agent, a case study was conducted in House Building Finance Corporation (HBFC) to investigate and understand the unrest in the financial corporation. In HBFC, the union was not allowed to work as Collective Bargaining Agent and there was a political factor involved in the affairs of CBA. So , from both sides the problem was being created and thus hampering the official work on one side and abridging the rights of workers and trade union on the other side.[22]

While interviewing with management and workers, it was revealed that there is no any significant role of unionism in the organization because management resolve the problem of workers.[23] The management’s assertion regarding Collective Bargaining Agent, that union should concentrate its energies to maximizing HBFC’s profit and not only continue to raise their demands.[24]

The Management of HBFC thinks that the union’s activities as anti-organization and management does not communicate any information with low level workers unless pressure is exerted by the union. In short there is a complete mistrust between Management of HBFC and Trade Union, and there is an urgent need to lessen this gap and mistrust. In this Case Study of HBFC, the recommendations have been suggested to improve the CBA include; Freedom of Association, Trade Union recognition, support of labor administrative authorities, mutual trust between management and trade union, proper communication and review of agreements are those steps which if implemented in the letter and spirits, can improve the atmosphere in HBFC.[25]


In constitutional democracy the rights of everyone are guaranteed and particularly labour class of the country are also protected. Constitution of Pakistan gives such rights but State has still to realize its responsibility and implement all fundamental rights. State in modern day life play a parental role in safeguarding the rights of the people. The unionization rights were also available before Donovan Commission Report but it raised the status of the rights of labour unprecedentedly and laid the foundation of labor democracy where it recognized the Collective Bargaining Agent’s role in any industrial relations. After passage of 18th Constitutional Amendment 2010, among others, the labor issue has also been devolved to the provinces and now respective provinces have to legislate for the welfare of the labor/workers’ class to maximize the economic growth and economic stability in the country.



[1] Commonwealth v Pullis, Philladelphia’c Court (1806).

[2]Compa, Lanca A. “An Overview of Collective Bargaining”, Cornell University”, 2014.

[3] Commonwealth V Hunt 45 Mass.111 (1842).

[4] Ibid at Footnote No.38.

[5] Ibid.

[6] Ibid.

[7] Article 17: “(1) Every citizen shall have the right to form associations or union, subject to any reasonable restriction imposed by law in the interest of sovereignty or integrity of Pakistan, public order or morality. (2) Every citizen, not being in Service of Pakistan, shall have the right to form or be a member of a political party, subject to any reasonable restrictions imposed by law in the interest of the sovereignty or integrity of Pakistan or public order and such law shall provide that where the Federal Government declares that any political party has been formed or is operating in a manner prejudicial to the sovereignty or integrity of Pakistan, or public order the Federal Government shall, within fifteen days of such declaration, refer the matter to the Supreme Court whose decision on such reference shall be final: Provided that no political party shall promote sectarian, ethnic, regional hatred or animosity or be titled or constituted as a militant group or section. (3) Every political party shall account for the source of its funds in accordance with law. (4) Every political party shall, subject to law, hold intra-party elections to elect its office-bearers and party leaders.”

[8] Karim, Justice (Retd) Fazal, “Judicial Review of Public Actions: A Treatise on Judicial Review, with some important background topics such as concept of jurisdiction, constitutional concept of Judicial Power, Legislative Power and Executive Power” Vol-I, First Edition, 2006, Pakistan Law House.

[9] Article 22 “1. Everyone shall have the right to freedom of association with others, including the right to form and join trade unions for the protection of his interest. 2. No restrictions may be placed on the exercise of this rights other than those which are prescribed by law and which are necessary in a democratic society in the interests of national security or public safety, public order (order public), the protection of public health or morals or the protection of the rights and freedoms of others. This Article shall not prevent the imposition of lawful restriction on members of the armed forces and of the police in their exercise of this right.”

[10] PLD 1997 SC 781.

[11] Ibid at page No.817.

[12] Ibid Footnote, page No.706.

[13] International Labour Organization (ILO) Convention NO.98.

[14] ILO C.98 Section 2.

[15] Trade Union and Collective Bargaining Agent; Pakistan Workers Confederation.

[16] Section 48 of PIRA 2010.

[17]The Punjab Prohibition of Child Labour at Brick Kiln Ordinance 2016 (v of 2016).

[18] Draft Labour Policy, 2015, Government of Punjab, Lahore.

[19] Section 12 of PIRA 2010.

[20] European Union GSP Plus and Challenges of Labours Standards Compliance in Pakistan; A Report by Pakistan Workers Confederation, Islamabad December, 2015

[21] Ibid.

[22] Luqman, Rana Abdul, “CBA and its Implementation: A Case Study of HBFC in Pakistan”, Interdisciplinary Journal of Contemporary Research in Business, Volume, 3, No.9, January 2012.

[23] Ibid Para No.4.

[24] Ibid.

[25] Ibid Para No.4.4 (Suggestive Factors for Effective Collective Bargaining).



1. Ghani, Mahmood Abdul, “Collective Bargaining and Social Legislation in Western countries and in Pakistan: No Light at the end of the Tunnel, Labour Law to Nowhere”, Pakistan Law House, 2013.

2. Gorman, Robert A., “Basic Text on Labor Law Unionization and Collective Bargaining”, West Publisher Co., 1976. USA.

3. The practice of Collective Bargaining, James P. Begin, Edwin F. Beal, 7th

4. Punjab Industrial Relations Act, 2010 (PIRA), Government of the Punjab, Lahore.

5. Public Labour Policy 2015 (Draft). Labour and Human Resource Department, Government of the Punjab, Lahore.

6. Ghayur, Sabur, “Freedom of Association and Right to Organize Bargaining Collectively: Current situation and Recommendations for Labour Law Reform in Pakistan: A Study undertaken on Behalf of Pakistan Workers Federation for the International Trade Union Confederation. Asia Pacific (ITUC-AP), ITUC-AP Cross Study on Labour Law Reform, February 2010 Islamabad. Pakistan.

7. Ghayur, Sabur, Decent Work, Pakistan Workers Federation, Islamabad, 2011.

8. Collective Bargaining: a Booklet published in Urdu by Pakistan Workers Federation, Islamabad.

9. Luqman, Rana Abdul, “CBA and its Implementation: A Case Study of HBFC in Pakistan”, Interdisciplinary Journal of Contemporary Research in Business, Volume, 3, No.9, January 2012.

10. European Union GSP Plus and Challenges of Labours Standards Compliance in Pakistan; A Report by Pakistan Workers Confederation, Islamabad December, 2015


This paper on the  Collective Bargaining Agent And Donovan Commission Report consists  of two parts. Part I is also available in the Commentary section of the website.

The views expressed in this article are those of the author and do not necessarily represent the views of or any other organization with which he might be associated.

Muhammad Imran

Author: Muhammad Imran

The writer holds a degree in LL. B (Punjab University) and M. Phil (Islamic Studies) and is an LL. M Candidate at University of Lahore. He has avid interest in Constitutional Law and is currently working at the Shaikh Ahmad Hassan School of Law (SAHSOL), Lahore University of Management Sciences (LUMS).