The general term refers to agreements between unions and employers or employers` organizations (see ability to enter into collective agreements) to regulate both individual labour relations and relationships established directly between the signatory parties (see below, content). The Portuguese Constitution lays the groundwork for the legal institutionalization of collective bargaining by giving trade unions the power to exercise the right to negotiate (Article 56, paragraph 3, paragraph 4). The normative effects of collective agreements are expressly recognized by law (Article 12, Employment Contracts Act), which is one of the sources of employment contract law (see sources of labour law). Thus, the provisions of collective agreements apply directly to individual labour relations and replace all contractual conditions less favourable to the workers concerned. i) Most agreements are at the factory level. However, there are some agreements at the industry level; (ii) the scope of the agreements has expanded to include issues related to bonuses, productivity, modernization, permanent contracts, voluntary arbitration, incentive schemes and employment evaluation; Unlike other minimum wages around the world, it is much more flexible and relies on an agreement between employers and employees in the form of a union. The importance of a collective agreement is that it is legally binding on both parties. Article 32, paragraph 1, of the Trade Union and Employers` Organizations Act states that “any collective agreement is binding on the parties.” This means that each party (i.e. either the government or the public employees union) could obtain a court order to compel the other party to comply with the agreement. If a party wishes to refuse the agreement, it must be served in writing to any other contracting party regarding the refusal for one month (see paragraph 2 of Section 32). In addition, such a communication of refusal is not notified without the Minister`s written authorization within the first six months of the agreement coming into force (see section 32, paragraph 2).
A sample carried out by the Indian employers` organisation for the period 1956-1960 showed that collective agreements were concluded between 32 and 49% in the event of a dispute. Most of the collective agreements have been concluded at the enterprise level. In this context, the National Labour Commission has fully highlighted the progress of the collective agreement. However, new contracts can be written to solve the problems of the previous treaty. In addition, since everyday problems are solved, they set precedents for managing similar problems in the future. Such precedents are almost as important as the contract for the control of working conditions. In short, collective bargaining is not an “on-and-off” relationship that is kept in refrigerated warehouses, except when new contracts are being developed. The following factors or activities hinder the effectiveness of collective bargaining: nevertheless, the components and mechanism of the territorial labour market correspond to those of the non-spatial model. The labour supply offers their availability for work and skills and targets high wages, job security and career opportunities.