Salary overlap implies a reduction in the salary gap.
Overlap is a term that, according to the dictionary of the Royal Spanish Academy ( RAE ), allows us to refer to the hole that certain sores exhibit.
The concept , however, is usually used with reference to what happens when two or more issues overlap, intersect or overlap . For example: “I am going to tell my secretary to pay more attention to avoid overlapping meetings” , “If the date of the presidential elections is ratified, there will be an overlap with the voting to elect the communal authorities” , “The “Secretary of the Treasury, who also serves as Director of Contracting, was denounced for overlapping incompatible functions.”
Salary overlap
In the field of labor and the economy , salary overlap is called the phenomenon that occurs when the salaries of the employees who earn the least increase and the rest of the salaries do not experience changes. It should be noted that this concept is also known as salary overlap . In this way, the wage gap is reduced and the difference between employees in lower positions and managers is narrowed.
Although wage overlap can be seen as contributing to social equality , the situation can pose a problem for employers. Faced with overlap, higher-skilled labor may become disgruntled as the hierarchy becomes distorted. To avoid conflict, it is common for employers to give bonuses or give more days off to those in higher-paying positions as compensation. The objective with this type of measures is to dismantle possible conflicts with the most qualified workers in the company .
Salary overlap means that the differences between those who earn the most and those who earn the least are reduced.
The remuneration pyramid
In this framework, we talk about the remuneration pyramid , a concept that helps us graphically visualize the salary scale , from the lowest to the highest. In a normal or traditional company, there is a clear difference in remuneration between the different departments and positions, which are configured respecting factors such as years of experience and the importance of the projects that the employee is in charge of, in addition to specific issues such as awards for good performance.
It is enough to take a look at the salary sheet to identify a kind of "ladder", and if the different values were aligned along an imaginary axis in the center and ordered from lowest to highest, we could observe the aforementioned pyramid . Now, salary overlap aims to reduce the distance between each step and the two that enclose it, so that the pyramid is "flattened" and all levels are very close to the others.
Causes of salary overlap
It can be said that an overlap occurs because the different salaries are confused with the others as they are so close in their monetary value . On many occasions, salary increases for workers in the collective agreement lead to a reduction in the salary range. The collective agreement of workers is also known as the collective labor contract or collective agreement and is a particular agreement that formally establishes the relationship between the company and the staff.
Very often, wage overlap occurs between workers who are part of a union and those who are not. As mentioned in a previous paragraph, beyond the benefits that this measure may offer to a part of the company and at a social level, it is common that it generates great dissatisfaction in those who believe that their merits are fading because they receive a salary almost equal to the of those who are below their category. If the company does not compensate them, their performance declines and their efforts to pay their employees equally are negated.