Analyze and critique a current article (no more than 6 months old) from a newspaper or a business magazine – Research Paper Example
In contrast to this statement the author also mentions the example of Glassdoor Company that has a completely transparent pay structure and it displays on an open portal the pay policy and pay structures of all employees (Lawler, 2012). This could be motivating as well that everyone is paid fairly or de motivating as well when the employees compare salaries. In conclusion, the recommendation offered was that pay structures ought to be designed based on performance and includes employee decision making power (Lawler, 2012).
Pay levels are a very important determinant employee satisfaction. It has been studied that the level of pay and the extent to which it increases directly affects the turnover rate of employees in the company (T ekleab, Bartol, & Liu, 2005). So the research rightfully supports the idea presented in the article that employees tend to get de motivated when pay structures are kept hidden. The perception arises that probably one is underpaid and somebody not so deserving is getting paid well. This inequality directly leads to high turnover which in turns affects the productivity of the company and bring defamation to it (Tekleab, Bartol, & Liu, 2005)
Reward structures are mainly planned to treat the employees fairly and consistently over a period of time. The most difficult conflict to overcome in an organization is pay for performance reward structure for employees. This is a constant source of tension in the organization’s environment and creates a conflict situation in between the workforce as well, thus affecting achievements of work targets and smooth functioning of business (Wood, 2009). With time there also has been a considerable change in unionization and pay structures are being determined on the basis of output. Most employees want to negotiate their pay scales on the basis of output and assume their pay scales to be aligned to the output. Employees also associate other motivational factors in designing pay structures such as empowernement, justice, equality etc (Wood, 2009).
Then the conclusion of the article stated that a transparent pay structure could ensure more employee motivation and managers making correct decisions about pay structure. A study carried out proved that the more employees are able to review the pay structures the more they feel committed to being loyal to the company (Mulvey, LeBlanc, Heneman, & McInerney, 2002). They also tend to improve their performance and align it with the company’s strategic goals and objectives. This transparency also gives them a feeling of empowernement in the organization which is a very essential determinant of motivation in organizational behavioral studies. But at the same time a potential pitfall to this situation is that sometimes employees feel that they are underpaid and they tend to fill the gap by switching jobs (Mulvey, LeBlanc, Heneman, & McInerney, 2002).
Lawler, E. E. (2012, September 12). Pay Secrecy: Why Bother? Forbes Magazine, p. 1.
Mulvey, P. W., LeBlanc, P. V., Heneman, R. L., & McInerney, M. (2002). Study Finds that Knowledge of Pay Process Can Beat Out Amount of Pay in Employee Retention, Organizational Effectiveness. Journal of Organizational Excellence, 29–42.
Tekleab, A. G., Bartol, K. M., & Liu, W. (2005). Is it pay levels or pay raises that matterto fairness and turnover? Journal Of Organizational behavior , 899–921.
Wood, G. (2009). Reward Structures . In G. Wood, Human Resource Managemnet (p. 208). New York : Routledge .