cost-of-living adjustment (COLA)

cost-of-living adjustment (COLA) definition - business

cost-of-living adjustment (COLA)

An adjustment of wages to compensate for changes in the cost of living. The adjustments are generally based on the consumer price index as published by the U.S. Department of Commerce. COLAs are included in many union contracts and government pensions, including Social Security.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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