Granting wage increases solely on the basis of the CPI helps compress pay rates within a pay structure, thereby ensuring equity among those who receive the wage increase.

Question

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Granting wage increases solely based on the Consumer Price Index (CPI) does not necessarily ensure equity among recipients or compress pay rates within a pay structure, as it does not account for individual performance, job complexity, or market rates for specific roles.

Granting Wage Increases Solely on the Basis of the CPI