Harriet is annoyed that her employees are complaining. Her logic is as follows: “Are we really so…
Harriet is annoyed that her employees are complaining. Her logic is as follows: “Are we really so different from other companies? Everywhere I’ve worked, there have been pretty big pay disparities. The fact is, you can’t really avoid it these days.” Using equity theory, which of the following applies?
Harriet is using an inaccurate referent other, as other companies’ pay disparities are secret
Harriet is saying that all companies have the same input (pay disparities), but only her company has a negative outcome (employees complaining), so this is unfair
Harriet is highlighting a distributive justice concern
All of the above
Consider the recommendations suggested by Bruce Tulgan. What would be an issue with his suggested solution?
Tying rewards directly to meeting objectives represents a form of negative reinforcement
Wages may not be subject to market pressures, so transparency will not help
Letting employees negotiate their own salaries favors men, as women (but not men) who try to negotiate their salaries are viewed negatively.
Accurate information is not actually more constructive than speculation
Consider Ira Kay’s suggestion of using salary bands. He notes “Publishing salary bands lets people know how their pay compares with others’ in the same job and what their jobs are worth relative to others in the company. It lets them know the upside potential of their current job and their career opportunities within the company – all job openings should be disclosed to employees on the corporate intranet – without telling them what everyone else makes.” Why is this unlikely to work?
Based on what we have learned so far in MGT 325. salary bands actually are likely to work
Salary bands do not address the underlying lack of person-job fit
From an equity theory perspective, knowing what you could make in the future does not resolve the inequity individuals feel when comparing their current inputs and outcomes
This approach will only apply to those who are high in equity sensitivity
