escalator clause

escalator clause definition - business

escalator clause

A contract provision that stipulates payment increases under certain circumstances. For example, a lease may call for increased payments to cover increases in energy costs or taxes. Escalator clauses are often included in union contracts for adjusting wages according to some identified index.

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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