Suppose that in labour negotiations with management, the Amalgamated Ditch Diggers proposed wage increases be tied to the consumer price index. This is called a(n) ________ clause.
A) adjustable wage index
B) cost-of-living adjustment
C) variable wage
D) recognition item
E) CPI-wage adjustment

Question

Quizplus · Accepted Answer

A cost-of-living adjustment (COLA) clause ties wage increases to changes in the consumer price index (CPI), which measures the average change in prices over time of goods and services consumed by households. By doing so, it ensures that wages keep pace with inflation and the purchasing power of workers is maintained. Therefore, the answer is B - cost-of-living adjustment.

Suppose That in Labour Negotiations with Management, the Amalgamated Ditch