Wage Determination: An Analysis of Wage Criteria

Wage Determination: An Analysis of Wage Criteria

Wage Determination: An Analysis of Wage Criteria

Wage Determination: An Analysis of Wage Criteria

Excerpt

The sharp rise in wages and in non-wage benefits during World War II and in the postwar years has focused public attention upon this area. What factors determine the proper adjustments to be made in wages and in other benefits? The articulateness of labor leaders in espousing their cause has brought under the white glare of publicity those decisions which formerly were made unilaterally and without the need for public justification.

The development of powerful unions during the past quarter of a century has had a significant impact on wage determination. Although there has been considerable dispute as to whether or not unions have forced up wages to a higher level than would otherwise have prevailed, there can be little question that the growth of unions has affected the mechanics of wage determination. Unions usually come better prepared to the bargaining table than do individual workers. They can assure a fuller discussion of the relevant (and sometimes irrelevant) issues than took place formerly. In turn, this has required a sharpening of management thinking about the factors which enter into wage determination.

This is not a book dealing with wage theory. Such theory has little value in the give and take of collective bargaining. Rather, emphasis is given to factors that determine general changes in wages and in non-wage benefits. A considerable literature has developed concerning the role of unions, collective bargaining, human relations, and related subjects. However, less attention has been given to the factors which the parties emphasize in bargaining about wages. Inevitably the wage negotiation setting has become institutionalized, as both labor and management have developed greater experience with their arguments and counterarguments.

This book discusses wage determination as it has evolved in collective bargaining. It is built around the six wage criteria which have assumed increasing importance: wage comparisons, cost of living, workers' budgets, productivity, ability to pay, and economic environment. Wage criteria are not new because one or more have been emphasized for many years. However, over the past two decades, both labor and management have given increasing recognition to their use on a more systematic basis. This development has accompanied the greater maturity in labor-management relations. Although the use of wage criteria does not provide a scientific formula, it does afford a useful framework of reference for contract negotiations. The . . .

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