Definition: Collective Laissez-Faire

Collective Laissez-Faire is the system by which power is given in the hands of the employees & trade unions by which they can freely negotiate among one another, thereby leading to arrival at a decision completely on their own

This style of leadership is also called delegative style, where the power is passed on to the people in the process.


1. Hardly or no interference from the government, therefore allowing for easier negotiations

2. It takes into account that the parties are on an equal footing with respect to the bargaining power.

3. The system & elements provided for the decision making & negotiation are provided by the government.


1. Matters where regulation is needed cannot be handled properly.

2. Often if there is a dispute between the parties relating to negotiation related constraints, it becomes difficult to solve

3. The management may be portrayed as a laid back, not enough proactive

4. The system of collective laissez faire differs from industry to industry, thus it may not be applicable in an industry where regulations are key.

Thus it is imperative that the industry mapping is done before allowing laissez faire, and we also need to understand the implications of it.

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