When new hires are brought in at or near the pay of more experienced employees, wage compression can quickly become a labor relations issue. Rather than waiting for it to become a bargaining-table sticking point, management should take proactive steps to address it. Here are four things employers can do:
- Regularly review wage rates across positions and seniority levels
- Identify employees whose experience, skills, or tenure are no longer meaningfully reflected in their pay
- Consider compression when making market adjustments or increasing starting rates
- Develop a strategy to address inequities before they become grievances or bargaining demands