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A sectoral collective agreement, also known as an industry-wide collective agreement, is an accord concluded between employers’ associations and trade unions that applies to all undertakings and employees within a given sector. In contrast to a company-level collective agreement, which is confined to a single enterprise, a sectoral collective agreement encompasses a wider group and establishes uniform terms and conditions of employment, including wages, working hours and leave entitlements.

This type of agreement is significant in that it enhances the bargaining power of employees and precludes competition among undertakings on the basis of inferior employment conditions. It also fosters a level playing field within the sector.

In practice, a sectoral collective agreement is frequently declared generally binding by ministerial decree, thereby extending its application to non-affiliated employers and employees within the sector.