Management attitudes toward two-tier pay plans

Two-Tier Compensation Structures: Their Impact on Unions, Employers, and Employees

“…The most prevalent application of the job-duty tier ap pears to be in the retail food industry. Here, nonfood clerks and food clerks perform the same tasks with different products, yet the nonfood clerks are paid considerably less (Jacoby and Mitchell 1986;Ross 1985;Introduction to Tiered Compensation 7 form, which will be referred to as the location tier, does not appear to be very common, although it does exist in the retail food industry where new locations are established to directly compete with nonunion operations. Manufacturing firms have also implemented location tiers (Wessel 1985).…”

“…Since tiers are generally negotiated in response to a proposal by management (Jacoby and Mitchell 1986), tiers are viewed by the union and employees as a concession (e.g., Balliet 1984;Craft, Abboushi, and Labovitz 1985). Many have labeled two-tier wage structures as an outcome which is associated with concession bargaining (Balliet 1984;Craft, Abboushi, and Labovitz 1985;Jacoby and Mitchell 1986;Mit chell 1983).…”

“…Many have labeled two-tier wage structures as an outcome which is associated with concession bargaining (Balliet 1984;Craft, Abboushi, and Labovitz 1985;Jacoby and Mitchell 1986;Mit chell 1983). Most concessions generally affect the wages, benefits, or working conditions of those workers already employed (e.g., Ploscowe 1986).…”

“…Tiered compensation structures can be classified into two categories: permanent or temporary (Jacoby and Mitchell 1986;Ross 1985). Under a "permanent" plan, the "new" or low-tier employees are compen sated on a separate and lower scale than the high-tier employees.…”

“…Much of the research on business strategies has focused on management, given that manage ment has made most of the important strategic decisions (Kochan, Katz and McKersie 1986). The history of tiered compensation structures suggests that the initiative for such plans comes from management (Jacoby and Mitchell 1986). It is management that selects both the initial and subsequent role of tiers in a firm's industrial relations and business operating strategies.…”