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

A multiple motive perspective on strike propensities

“…The union leaders were also interested in having the strike willingness of its members assessed so that they would know the members' willingness to sacri®ce or strike to obtain the union's goals. The employer in question was identi®ed by the pseudonym Mayway by Martin and Heetderks (1990) in a case study of labour relations and wage tiers. They provided the following description of the competitive environment during the period around which our data were collected (Martin and Heetderks, 1990: 90):…”

“…Further, data from industry market surveys indicate that Mayway's share of the retail food market was at least three times greater, on the average, per store than for any competitor with stores in the same area.' Martin and Heetderks (1990) noted that the average Mayway store in 1986 had six times as many employees per store than its competitors because of two factors. First, about 45 per cent of its employees were in general merchandise departments compared to less than 5 per cent for competitors.…”

“…However, local labour market conditions certainly are different. In 1983, unemployment and the expectations of in¯ation were higher than today, but historically these have¯uctuated (Martin and Heetderks, 1990). Union concessions, while common during this period (Kochan and Katz, 1988: 378), are still being asked for today (Holley and Jennings, 1997: 60).…”

Revisiting multi-tier wage structures: Equity, employment mobility, and tier effects

“…M&P suggested that multi-tier systems create an inequitable relationship between the employee and the internal referent, i.e., the A-tier worker in the same job. Furthermore, they stated that union newsletters provide workers with extensive information which also permitted comparisons with external referents, i.e., other workers in the labor market (Martin, 1990). For the B-tier worker, all of these referents would be negative.…”

“…The pay scale for new hires (the "B" tier) may be permanently lower than the existing scale (the "A" tier) or the two may gradually converge over time (Cappelli and Sherer, 1990;Essick, 1987). Two-tier wage structures have been established in industries, such as airlines (Walsh, 1988) and retail food (Sichenze, 1988(Sichenze, , 1989Martin, 1990)) The United Food and Commercial Workers' Union (UFCW), the dominant union in the retail-food industry, has more of these agreements than any other union (Sichenze, 1988;Bureau of National Affairs, 1992). Over 90 percent of 89 major collective bargaining agreements (covering 1,000 or more workers) in the retail-food industry contain two-tier or multi-tier wage provisions; the vast majority of wage tiers in these contracts are permanent rather than temporary and multi-tier rather than twotier (Sichenze, 1988(Sichenze, , 1989.…”