nd 1969 a
new wage system was introduced throughout industry on March 1, 1970,
still on an experimental basis. Some of the changes brought about by the
highly complex new system included: a reduction in the spread between
wage rates in different industry sectors and between the upper and lower
limits within certain wage categories; the establishment of in-grade
wage differentials depending upon the personal achievement of the
worker; a rise in the proportion of basic wages to total pay (which also
includes bonuses); and a tightening of the provisions concerning the
payment of bonuses. Provision was also made for withholding a portion of
the pay in the event that production targets are not fulfilled.

Downgrading the importance of bonuses was intended to stimulate the
raising of skill levels by making higher earnings dependent primarily
upon promotion to higher wage categories, based on qualification rather
than on surpassing quantitative production norms. As a means of reducing
labor turnover, a seniority system was introduced, with wage increases
based on length of service in the same unit. The reform of the wage
system was accompanied by a general rise in wages averaging 12.3
percent.

A further increase in wages is planned for the 1971-75 period. The
minimum wage of 800 lei (for value of leu, see Glossary) is to be raised
to 1,000 lei in September 1972 and to 1,100 lei in 1975. The average
wage is scheduled to reach almost 1,500 lei in 1972 and 1,805 lei at the
end of the five-year period. In accordance with past policy, the rise in
wages will be kept well below the increase in productivity (see ch. 14).

Along with the modification of the wage system, legal measures were
enacted to tighten labor discipline. These measures provide for the
imposition of fines up to 10,000 lei for violations of economic
contracts and fines of from 50 to 1,000 lei for negligence while on
duty; they oblige employees to make good the full amount of any damage
for which they are responsible; and they enable the enterprise
management to reduce workers' wages when standards of social behavior
are not met. Penalties may be imposed by the enterprise director or the
management committee. The only recourse open to workers is an appeal to
the higher administrative bodies.

The broad concept of standards of behavior offers a wide latitude for
the exercise of individual judgment by management. No criteria have been
provided for determining the