Collective bargaining is where employees, normally represented by a trade union and employer/s negotiate with each other about terms and conditions of employment in order to reach a collective agreement. The collective agreement may have different conditions to those in the Basic Conditions of Employment Act (BCEA).

A collective agreement overrides any individual contract of employment. Collective agreements can be of two kinds:

• The BCEA allows variation of certain specified conditions in the BCEA through collective bargaining between a group of employees represented by a registered union working for the same employer (usually at one workplace) and the employer.
• The Labour Relations Act allows centralised collective bargaining between groups of employees in the same industry or sector and employers in that industry or sector. They draw up a Bargaining Council Agreement which businesses covered by that agreement in that sector have to follow.
• The Act also allows for a Collective Agreement to be entered into within an organisation between a registered trade union and the employer.