With the ever-growing spotlight on gender pay differences and many companies implementing plans to address perceived issues, a timely study in the US examined the approach of men and women to salary negotiations in an attempt to determine if it was a significant determinant of gender pay differences. The study results indicated that, when applying for a job, men were more likely to negotiate for higher pay under certain conditions, while women were more likely to accept a lower wage.
Key Topics: Pay equity; Gender; Pay negotiation; Gender pay gap
With companies constantly seeking ways to gain competitive advantage, many employ the use of pay for performance i.e. those employees whose performance is better get more, but if such practices are managed poorly could they impede the effort of higher ability employees? A study at the University of California examined the effect of compensation distribution on the performance of higher-ability employees and found that such employees reduced their effort when not paid more than low ability colleagues, under pay for performance conditions. The findings also indicated that when managers are unclear on the ability of employees then compensation compression between high and low ability employees is more likely.
Key Topics: Compensation inequality; Compensation compression; Employee effort; Pay for performance
Against the current backdrop of increasing globalisation of companies and their reward practices, a recent study examined the extent of international cultural differences between France and the US in preferences for redistributive versus performance-based compensation systems. The study found that Americans had a greater preference for individual performance pay while French participants preferred redistributive pay. The researchers argue that this is at least in part due to differing beliefs about equity.
Key Topics: Culture; Compensation systems; Compensation inequality; Just-world beliefs; Redistribution
A Bird In The Hand Is Worth Two In The Bush…Employees Care More About What A Company Has Already Given Them Than What They Might Give Them In Future
With unpaid overtime a more common occurrence than ever in modern business, a Dutch study looked at the motivating factors behind why employees participate in such unpaid work, focusing on the effect of forward-looking incentives, such as bonuses and promotions, and backward-looking incentives, such as current and past compensation. The researchers demonstrate that, contrary to expectations, it is employees with stronger backward-looking rather than forward-looking incentives who are more likely to participate in unpaid overtime.
Key Topics: Motivation; Compensation; Overtime; Forward-looking incentives; Backward-looking incentives
As the battle for talent continues, companies are increasingly looking toward non-traditional methods to attract key talent, with one such tactic being the use of non-financial rewards. To examine the effectiveness of non-financial rewards, researchers in South Africa looked at the influence of work-life balance, learning, and career advancement on the attractiveness of jobs to potential employees. The results indicated that the presence of all of these reward types increased job attractiveness, but the attractiveness effect was greater on women.
Key Topics: Non-financial rewards; Talent attraction; Recruitment; Retention