Two-tier system

The two-tier system is a modality employed by companies to scale back negotiated wages and/or benefits. When a two-tier system is in place in a new contrat, workers hired before ratification of that contract have a wage progression table (or benefits) different from those hired after ratification. Alledgly, companies whose industries experience downturn in the market re-adjust wages to the new realities of the market without affecting workers with seniority. Critics argue this system creates a second-class of workers and causes high turnover.