Wage systems Essay Example | Topics and Well Written Essays - 1000 words

rent clays - Essay ExampleMany factors can be identified as wage determinants. They can be selected in the following groups economic, social, phycological and institutional. In this essay I will stick to the economic determinantsMeasuring devil-tier system and subsidization system using the first etalon, a companys ability to pay, I must say that these two systems have different assignation. The subsidization poting system was widely used in 1980s and sell unions often agreed with wage cuts because companies were not able to pay full wage and at the corresponding snip wanted to keep their employees, as it is written in the review of the Organisation for Economic Co-operation and culture (OECD) (1997) The concession bargaining which has occured in several years is an illustration of the recognition by both firms and unions of the affaire between costs, and thus prices, and output and employment (http//www.oecd.org/dataoecd/19/60/2080431.pdf) . The concession system lost its popularity and chance in 90s when unions understood that companys were again able to pay then they did. The two-tier wage system appeared to reconcile oversight and employees in a struggle for higher salary, it sacrificed new employees in order to make happy experienced employees. That was done to keep anticipated productivity. The two-tier structure permits hiring of new workers at significantly lower wages and well-beings, compared to those of the fixity work force. It will be worth countless millions of dollars to employers in coming years. (http//www.laboreducator.org/twotierpay.pdf) Thus companies management benefited as wage increase was offset by rising level of productivity and at the same time newcomers didnt receive equal payments. So the concession system and the two-tier system are assigned for different situations. The concession system can help to rise general companys ability to pay, while the two-tier system is in general designed to meet expectations of exper ienced employees.The willingness to pay is also an important factor for comparison of the two-tier and concession systems. unless in the most extraordinary circumstances, there is no acceptable reason for a union to bargain concessions. In the case of a business that is profitable, there is absolutely no reason for concession bargaining. The results of concession bargaining over the last two decades should stand as proof that concessions do not benefit workers. (http//www.ufcw.net/articles/Toolkit/concession_bargaining-01.html) The concession system doesnt enforce the willingness of a company management to pay as it put restrictions on level of wages.The two-tier system stimulates management to attract experienced employees on the companys side in the bargaining affect with new employees, thus this system increases a companys the willingness to pay. Though the willingness is largely a measure of equal scattering and fair competing process in the marketplace. The concession system grants to a company a chance to determine a level of wage that will be considered fair, thus decreasing level of employees participation in distribution of a companys income. The two-tier system controls fair distribution only for experienced workers while newcomers are interact unfairly.) Although employers have to track wage market in terms