What is a COLA clause in union contracts?

A Cost of Living Adjustment (COLA) clause in union contracts is a provision that allows for periodic wage increases based on changes in the cost of living, typically indexed to inflation measures like the Consumer Price Index (CPI). This adjustment helps ensure that workers' wages maintain their purchasing power over time, protecting them from the effects of inflation. COLA clauses are often negotiated to provide financial security for employees, especially in long-term contracts.