What is a key characteristic of tiered wage systems?

A key characteristic of tiered wage systems is that they typically involve a structure where newer employees receive lower pay compared to those who were hired earlier and have more experience or tenure within the company. This system is designed to reward loyalty and experience, reflecting the idea that employees who have been with the organization longer are likely to have more skills and contributions to offer.

In such systems, pay scales are often established based on tenure, which means that as employees stay with the organization for longer periods, their compensation can increase, thereby creating a tiered effect. This structure can help incentivize employee retention, as workers may feel motivated to stay longer to achieve the higher tiers of pay associated with their length of service.

The other options do not accurately represent the defining feature of tiered wage systems. While equal pay regardless of hire date suggests uniformity in pay structures irrespective of tenure, pay based on employee performance reviews would focus on merit rather than duration of employment. Team-based compensation structures emphasize collective performance rather than individual tenure or experience.