Final answer:
A deferred wage increase is a true method of adjusting wages during a labor agreement term, acting as a form of economic insurance for employees and employers, and is related to strategies like COLAs used by labor unions.
Step-by-step explanation:
A deferred wage increase is indeed a method used to adjust employee base wage rates during the term of a labor agreement. This statement is true. These types of adjustments are often part of a broader wage strategy, which is intended to provide a form of insurance for both the employee and employer. Employees receive some protection against wage declines in bad economic times, in exchange for not expecting exorbitant wage increases during good economic periods.
In the 1970s and 1980s, labor unions negotiated contracts that included cost-of-living adjustments (COLAs), ensuring that wages kept pace with inflation. This form of indexing to wages is another strategy to manage wage adjustments smoothly over time, often embedded in labor agreement clauses.