The process of concluding collective agreements involves negotiation, conciliation, mediation and arbitration. To conclude a collective agreement, unions, employers' organisations or individual employers have the right and obligation to negotiate. The party which initiates negotiations has to formally inform the other party by letter about the venue and agenda for negotiations. If collective negotiations result in an agreement, this is formalised in a document signed by the representatives of both parties. If collective negotiations result in a dispute, intervention by a conciliator may be sought. This person is an employee of the Ministry of Labour and Social Security or the Labour Inspectorate. If negotiations between the parties fails again, they then have the right to seek the services of a mediator or they can opt for arbitration.

A conciliator is chosen by both parties from a special list. In the event of disagreement, the conciliator is selected by drawing lots. The conciliator can then invite the parties to re-negotiate, hear the parties separately, question individuals or seek to determine everything relevant to the conditions of employment of the employees or to the financial position of the employer. If, despite the efforts of the conciliator, the parties do not reach agreement within 20 days, the conciliator proposes a solution which, if accepted by the parties concerned, has the same legal status as a collective wage agreement.

In the event of failure to reach an agreement, the last resort is compulsory arbitration. The arbitrator is selected from a special list with the consent of both parties and, in the event of disagreement, by drawing lots. The arbitrator studies all documents and data examined during the previous stage and reaches a decision within 10 days. His decision has the same legal status as the collective wage agreement.

The collective wage agreement is compiled in three original copies and signed by the representatives of both parties. One of the copies is deposited with the Ministry of Labour and Social Security or the Labour Inspectorate.

All collective agreements are entered in the general register of the Central Service of the Ministry of Labour and Social Security and a special publication containing a complete copy of all agreements is issued.

The regulatory terms of a collective wage agreement have immediate and compulsory effect. However, the terms of individual employment contracts have precedence over the collective agreements if they deviate from the collective agreements or if they contain terms which are more beneficial to the person concerned.

The same law stipulates that the responsibility for conciliation and arbitration be assigned to an organisation which functions as a legal entity governed by private law and known as the "Organisation of Conciliation and Arbitration".

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