Two Tier Pay Structure   IN 1976, the Indian subsidiary of a multinational refinery became a government of India Company. The government company had announced an ambitious expansion program, which meant doubling the work force in less than four years in 1977 at the time of wage revision, the union and management agreed to a two tier structure. Those already employed will be eligible for a higher grade and those who are recruited fresh will get a lower grade though jobs are similar in skill, responsibility and effort. Both the union and the management justified that this is an innovative practice widely followed in deregulated companies abroad, particularly the airlines in north America Answer the following Questions: Is it a fair agreement? 2. Would it contravene with the concept of equal pay for equal work?

Social Psychology (10th Edition)
10th Edition
ISBN:9780134641287
Author:Elliot Aronson, Timothy D. Wilson, Robin M. Akert, Samuel R. Sommers
Publisher:Elliot Aronson, Timothy D. Wilson, Robin M. Akert, Samuel R. Sommers
Chapter1: Introducing Social Psychology
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Two Tier Pay Structure

 

IN 1976, the Indian subsidiary of a multinational refinery became a government of India Company.

The government company had announced an ambitious expansion program, which meant doubling the work force in less than four years in 1977 at the time of wage revision, the union and management agreed to a two tier structure. Those already employed will be eligible for a higher grade and those who are recruited fresh will get a lower grade though jobs are similar in skill, responsibility and effort. Both the union and the management justified that this is an innovative practice widely followed in deregulated companies abroad, particularly the airlines in north America

Answer the following Questions:

  1. Is it a fair agreement?

2. Would it contravene with the concept of equal pay for equal work?

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