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

This study considers the competing conclusions reached by Martin and Peterson (1987) and Cappelli and Sherer (1990) regarding two-tier wage systems and examines how worker perceptions of their own employment mobility affect attitudes about two-tier systems. Findings from a hybrid multi-tier wage system in the retail food industry containing both permanent and merging or temporary tiers indicates that workers on the permanently lower B tier possessed more negative attitudes than their A-tier counterparts, with some evidence that the effects of permanent and temporary plans differ. Employment mobility moderates these attitudes, for low mobility workers report more positive attitudes than do high mobility workers.