Salary compression is viewed as a/an:
A) positive thing because it ensures internal alignment throughout the organization.
B) negative thing because pay grades are eliminated and new hire wages are determined only by market rates.
C) negative thing by long time employees because their wages are close to those who are new on the job.
D) interactional justice issue because it occurs when supervisors don't communicate compensation changes.
E) positive thing because it eliminates merit increases and adjusts all employees' pay by the same amount each year.

Question

Quizplus · Accepted Answer

Salary compression is when the wages of long-time employees are too close to those who are new to the job, typically due to market forces, but it can also occur because of a lack of pay increases for the veteran employees. This can lead to feelings of resentment and dissatisfaction amongst the long-time employees, which can ultimately result in turnover.

Salary Compression Is Viewed as A/an