Bargaining power of Trade Union is
referred as the strength of Trade Union.
This strength is depending on the following factors
Elasticity of Demand of the product
they produce: If the demand for the product they produce is inelastic
then the bargaining power of trade union is more if not the trade union will be
weaker.
Profit level: as profit level
increases the strength of trade union will also increase whereas loss to the
firm will decrease the strength of trade union.
Total production and productivity of
labour: If the production and productivity increases strength of trade union
will also increase as increased production and productivity indicates profit to
firm.
Possibility of use of machines:(
Availability of substitution to the worker’s works) If it is possible for the
machine to work for the labour, then the trade union will reduce its bargaining
power, and vice versa.
The percentage of employees’ wages in
total cost: small percentage of wages in total cost shows higher profit and it
will influence the bargaining power of the trade union.
The status of economy (boom,
recovery): During the period of boom there will be more demand for goods and
services, which in turn increases productivity and hence the bargaining power of the trade union also will increase.
Total members in the trade union: If
the members from the industry are more in a trade union the bargaining power will be more or if members are less vice versa