Longevity Pay

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Longevity Pay

The higher pay one earns for remaining at the same company for a certain period of time. For example, one may receive a raise after six months, one year, two years and so forth. Proponents of longevity pay believe it encourages stability and lowers the employee turnover rate. Critics contend longevity pay discourages innovation by rewarding those who take few risks and are merely "good enough" to stay.