Written by Christine Whelan on February 2, 2021.
This article was published in the February Issue of New Zealand Management Magazine.
Our Strategic Pay Senior Consultant, Christine Whelan examines the debate around salary increases being based on CPI and why this may not be the best idea.
Let’s forget for a moment the fact that CPI doesn’t always move positively and consistently upwards – over the last 5 years it’s ranged between 0.5% and 2.5%, while the remuneration market movement has remained at a reasonably steady 2 – 3%. Remuneration market movements, since they inevitably reflect employers’ ability to pay, already take into account CPI, while not being driven solely by it.