Knowledge · HR & Labor

Collective Bargaining

Collective Bargaining

📂HR & Labor⏱2 min read📊Advanced🔗Related 7

What is collective bargaining?

In one line
The process in which a labor union and an employer negotiate working conditions and related matters. The employer may not refuse or neglect to bargain without a justifiable reason.
Bring this topic to your team📚 Related Courses💬 Ask About Training
⚡ Summary in 3 lines
  • A duty to bargain, not a duty to agree
  • Scheduling and responsiveness to data requests are evidence of good faith
  • If talks break down, mediation is required before industrial action

The moment a bargaining demand letter arrives, the first thing that changes at the company is not the wage proposal but the calendar. When a union requests bargaining, the employer must post that fact internally for 7 days so that other unions can join, and bargaining conducted without this step can later be challenged as invalid. Deadlines and formalities come before any contest over substance, and that is the real weight of collective bargaining. So on the day the letter arrives, the first thing to check is not the demand items but the receipt date and the posting expiry date.

At a workplace with multiple unions, the rule is a single bargaining channel. Once the participating unions are confirmed, the union with a majority of members becomes the representative bargaining union, and separate bargaining takes place only if the employer agrees. Bargaining subjects are not all alike, either. Mandatory subjects, such as wages, working hours, and employee benefits, are those where refusing to bargain is itself unlawful, while permissive subjects may be accepted or declined. Refusal leads to an unfair labor practice in the former category, so each demand must be assessed item by item. After talks break down, Labor Relations Commission mediation is required, and industrial action is possible only after the mediation period has passed: 10 days for general businesses, 15 days for public-interest businesses.

The most common misstep in practice is reading 'there is no duty to agree' as 'we can hold out.' Sending only staff with no decision-making authority to the table, sitting on scheduling replies for two to three weeks, or repeating a one-line 'trade secret' answer to requests for wage data can all be judged a failure to bargain, even if you show up. A remedy application can be filed within 3 months of the act, and if an order to bargain is issued, the company loses not only negotiating leverage but also the moral high ground. If there are items you will decline, documenting that you are declining and why is far safer than silence.

Training that covers this term · HR & Leadership
Recommended courses · Recommended instructors · Quick quote
📚Conflict Management Course2 hours · In-person corporate training · John KimView course →📚Emotional Labor Worker Protection Training (Preventing Health Hazards from Customer Abuse)2 hours · In-person corporate training · Anna ChoView course →
Instructor Hwi KimHwi KimCEO of HRDIST & talent development systems consultantInstructor Kyungtae KimKyungtae KimHR expert · Organizational culture and HR strategy consultant
🧮 Mini quote · Based on instructor fees
About KRW 1.2 million (≈ US$900)2-hour talk · up to 20 people · Korean
Get a quote for these requirements →
💡 In plain English
The duty to sit at the bargaining table is not the same as the duty to sign. But walking away from the table becomes a problem in itself.
Why it matters in practice
Bargaining is not about winning or losing; it is about following procedure. A single bad attitude can become an unfair labor practice.
Origin and sources

The Trade Union and Labor Relations Adjustment Act defines an employer’s refusal or neglect, without a justifiable reason, to bargain collectively with a labor union as an unfair labor practice (Article 81).

Source · Trade Union and Labor Relations Adjustment Act, Article 81
An example

Company A, an auto parts manufacturer with 240 employees and annual revenue of about KRW 62 (≈ US$1) billion, saw its first labor union form after 27 years in business. The union’s 130 members arrived with a 12-item demand list, including an 8% wage increase and a change to bonus criteria, and the HR team had no one with bargaining experience. (Hypothetical example)

  1. The day after receiving the official letter, the HR director posted the bargaining demand on the company intranet and website for seven days. This was a precaution in case another union emerged among non-production staff.
  2. The finance director broke the 12 demands down in a table and calculated the labor cost impact. The 8% wage increase came to KRW 940 million (≈ US$703,300) a year and the bonus criteria change to KRW 320 (≈ US$1) million, and the director drew the line at '4% is the limit.'
  3. When the CEO tried to step aside, the labor attorney advising the company made it clear that seating only people without decision-making authority is itself a failure to bargain. In the end, the executive vice president chaired the bargaining team, with authority to decide within a ±1.5% range on the raise rate.
  4. The three-year payroll ledger the union requested was converted into an aggregate table with personally identifiable information removed and handed over within 5 business days. Delays in providing data are a common basis for claims that the employer breached its duty to bargain in good faith.
  5. Across six bargaining sessions, the team kept minutes recording the date, attendees, and key remarks of each one, signed by both sides’ representatives. When the union objected to the postponement of the third session, these records served directly as the rebuttal.
  6. In the end, the company signed a collective agreement after five months, with a 4.5% wage increase and the bonus criteria unchanged. It closed without any remedy or mediation filing, and additional labor costs came in KRW 410 million (≈ US$306,700) lower than under the original demands.
Related terms
Labor UnionAn organization that workers form autonomously to maintain and improve working conditions and raise their status. It operates on the basis of the three labor rights guaranteed by the Constitution.Collective AgreementA written agreement between a union and the employer that records the outcome of collective bargaining. On working conditions, it takes precedence over work rules and individual employment contracts.Industrial Action · StrikeActs by a union that disrupt the normal operation of work to press its demands. They are protected only if their purpose, party, procedure and means are legitimate.Unfair Labor PracticeEmployer acts that interfere with workers’ exercise of the three labor rights. The law prohibits adverse treatment, yellow-dog contracts, refusal to bargain collectively, domination of or interference in the union, and similar conduct.Labor Relations Commission · Remedy ApplicationA quasi-judicial administrative body that mediates and adjudicates labor disputes. It handles remedy applications for unfair dismissal and unfair labor practices, as well as mediation of labor disputes.Salary Negotiation · Setting Pay Raise RatesThe process of dividing the company’s raise budget into individual raise rates based on performance rating and position within the pay band, then finalizing the result in an annual salary contract agreed with the employee.Yellow Envelope Act · Amended Trade Union Act, Articles 2 & 3The name given to the amendments that broaden the definitions of employer and worker in Article 2 of the Trade Union Act and limit damages claims over industrial action in Article 3. The core is widening the path for subcontractor and partner-company workers to bargain with the principal contractor, and restricting huge damages claims against strikes.
Training linked to this term
📚Conflict Management CourseNanum Consulting corporate training · In-person/onlineView Course →
Need in-house training on this topic?
Get a curriculum and quote tailored to your needs right away.
Ask About Training
📚 View Related Course🗂 All Programs📄 Free Resources🔎 Back to Glossary
Last updated 13 Sep 2026 · Reviewed by John Kim

FAQ

Refusing or neglecting to bargain without a justifiable reason is an unfair labor practice. However, the duty to bargain does not mean a duty to reach agreement.
Matters concerning working conditions are at the core. Matters that arguably go to the essence of management rights have long been disputed as bargaining subjects, so they need case-by-case review.
Repeatedly delaying replies or refusing to provide data can be judged as neglect of bargaining. Keeping records and responding in good faith is the safe course.
It leads to mediation by the Labor Relations Commission, and industrial action is permitted only after the prescribed procedures are completed. The procedural requirements are set by law.