A group of employees working for the same employer (usually at one workplace) and the employer negotiate and make a collective agreement. The collective agreement covers terms and conditions of employment for employees working for that employer.

The BCEA says what things employees and employers are free to make collective agreements about. For example, employees and their employer cannot collectively agree that child labour will be allowed. Certain core rights can only be altered if they are deemed to be more favourable than what the law allows. These include normal working hours (45 hours) maternity leave, night work provisions etc.

A workplace-based agreement may have different conditions to those in the BCEA, as long as they are more favourable to the employee than the BCEA. The BCEA sets out the minimum conditions of employment. If an agreement breaks any part of the BCEA, it is not enforceable and the BCEA conditions override the conditions in the agreement.

If the collective agreement does not cover certain terms and conditions of employment, then those terms and conditions in the BCEA apply to the employees.

Notice to terminate a collective agreement must be given in writing. Employers should always be wary about terminating collective agreements as this may be deemed under law to be a unilateral alteration of a working condition which is considered an unfair labour practice.

A collective agreement can be made mandatory and applicable for all employees in a bargaining unit (in other words, non-union members) if the registered trade union is a majority union and the agreement specifies those employees to be covered by such agreement.