Seniority and longevity are based on how long someone has worked at a job or with an employer. Someone who has worked for 20 years may have 20 years of seniority; if he receives longevity pay, his rate will be based on those 20 years of service. However, seniority is also used in benefit and management decisions.
Seniority systems give preference to employees who have been with the employer, profession or job for the longest period of time. Those with higher seniority have first choice of desirable shifts, transfers and assignments. Seniority can be used to determine promotions. Union contracts sometimes base employment protection on seniority, laying off those with lower seniority before those with greater seniority.
Longevity pay is based on duration of employment. Employers have the option of adding performance or merit bonuses to the base longevity pay.
Longevity pay and seniority are commonly used by unions and for government service employees. Longevity pay can also be used to give higher pay to those who have earned seniority in a lower pay grade.