Cost of Living Adjustment Considerations in Services Contraacts Among Rising Inflation

Morgan Lewis – In outsourcing, technology, and commercial transactions, cost of living adjustment (COLA) mechanisms linked to price indices are coming under increasing scrutiny with current global inflationary pressures. Irrespective of whether the recent spike in price indices will be a short-term or long-term phenomenon, existing COLA mechanisms in major agreements, and the negotiation of COLA mechanisms in new agreements, has become an increased focal point for both suppliers and customers.