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Chapter 4

Person 1 person 2 inequity under rewarded person 1

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Person 1 < Person 2 Inequity, under-rewarded Person 1 = Person 2 Equity Person 1 > Person 2 Inequity, over-rewarded Compare with Whom? …4 referent comparisons: Self-inside (employee ’s experiences in a diff. position inside his current organization) Self-outside (employee ’s experiences in a situation/position outside his current organization) Other-inside (another person/group of ppl inside employee’s organization) Other-outside (another person/group outside employee’s organization) Variables that Influence Choice of Referents: Gender - ppl often make same-sex comparisons - women usually paid less than men, so when woman-woman comparison has lower comparative standard for pay Length of Tenure - employees w/ short tenure: reply on own personal exp. - those w/ long tenure: reply more on co-workers for comparison Level in Organization & Amount of Education - upper-level employees/ in professional ranks/ w/ more education: have better info about ppl in other organizations (thus make more other-outside comparisons) Responses to Inequity: Change their outcomes (e.g. work harder to show one deserves higher pay) Adjust perceptions of self (e.g. think, “I’ve only worked for 2 yrs) Adjust perceptions of others (e.g. think, “other ppl have worked a lot longer, so deserve higher pay)
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P ART 2: S TRIVING FOR P ERFORMANCE Choose a different referent (e.g. consider others w/ similar experience/bg) Leave the field P AID BY T IME W ORKED P AID BY # OF U NITS P RODUCED O VER - REWARDED EMPLOYEE produce more than will equitably paid ppl (to bring about equity) produce fewer, but higher quality (b/c inc. in quantity will inc. inequity, so focus on quality) U NDER - REWARDED E MPLOYEE less, poorer quality output produce large # of low quality units (b/c inc. in quantity will inc. reward, so trade off quality for quantity) distributive justice = perceived fairness of the amount & allocation of rewards among individuals - high influence on employee satisfaction than procedural procedural justice = perceived fairness of the process used to determine distribution of rewards interactional justice = quality of interpersonal treatment received from manager - both affect employee’s organizational commitment, trust in boss, intention to quit - when managers/employees believed the processes were fair, they were more likely to show high level of trust & commitment to organization (and vice versa) - To inc. employee’s perception of procedural justice: - openly share info on how allocation decisions are made - follow consistent, unbiased procedures - Cognitive Evaluation Theory = offering extrinsic awards (e.g. pay) for work effort that was previously rewarding intrinsically will tend to DEC. overall level of a person’s motivation - individual loses control over his behaviour when it’s rewarded by external sources → causes intrinsic motivation to diminish
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Person 1 Person 2 Inequity under rewarded Person 1 Person 2...

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