Background on Flexible Wage Systems
1. Wage restructuring is about making the wage system more flexible to better respond to changing business conditions. With a nimble wage system, companies achieve flexibility and competitiveness, and employees enjoy greater job security, the best possible system of compensation and rewards, and a good understanding about how their wages may fluctuate with performance. It is not about cutting wages and is integral to our long-term strategy to stay competitive in fast-changing economic conditions.
2. Wage restructuring represents a new understanding between employers and employees. Employees accept the need to have wages that are reflective of their market value and linked to both their individual performance and that of the company. Employers in turn have a wage structure that adjusts flexibly with business conditions and the value created by employees. Employees would then be able to earn competitive yet stable wages and enjoy greater job security (and financial/income security), as companies resort less to head count cuts to survive bad times. Wages that reward performance and differentiate for performance also motivate workers to do their best.
3. For this relationship to be healthy, employers should recognize sacrifices that employees make in bad times by rewarding workers appropriately in good times. By working together for the long term, employees and employers commit themselves to building a future of job security and sustainable growth.
special note of date of November 9th, 2007 http://www.nytimes.com/2007/11/08/business/smallbusiness/08hunt.html?_r=2&oref=slogin&oref=slogin
Macroeconomic Advisers, a St. Louis consulting firm, showed an increase in private sector employment in October of 106,000. That included a surge of 63,000 at businesses with fewer than 50 employees, a gain of 50,000 at businesses with 50 to 499 employees — and a loss of 7,000 at companies with more than 500 employees.
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