Collective bargaining can be an ideal way for you to have greater input into the terms and conditions of doing business with larger businesses.
What is the benefit of collective bargaining?
The collective bargaining process allows you to negotiate a deal with one or more competing businesses for the sale or purchase of products or services with a common customer or supplier. You can include a price agreement in your negotiations. As your business may not be able to supply enough volume to a large purchaser, joining with another small business can open new market opportunities. Similarly, by bargaining as a group, small businesses may qualify for bulk discounts.
Who regulates collective bargaining?
The Australian Competition and Consumer Commission (ACCC) regulates collective bargaining under the Competition and Consumer Act 2010 (CCA - formerly known as the Trade Practices Act 1974). Although collective bargaining is likely to lessen competition and raise concerns under the CCA, the ACCC may allow collective bargaining arrangements if the agreement provides public benefit.
What is the collective bargaining process?
When bargaining with another business under the CCA, you can use either the authorisation or the notification process. Notification can be simpler, quicker and cheaper, as it allows for bargaining to start in as little as 14 days and costs only $1000.
Authorisation can allow more flexibility in the membership of the bargaining group. While the fee for lodging an authorisation application is $7500, in certain circumstances the ACCC can waive it in whole or in part.
What to do...
- Visit the ACCC website for more information on collective bargaining authorisations and notifications.
- Read the ACCC's Guide to collective bargaining notifications and Small Business Collective Bargaining Notifications & the Competition and Consumer Act publication to understand the benefits of each process.
- Watch the ACCC's Competing Fairly Forum on Collective bargaining.
- Read more about Tenders and Contracts.