Equity in the Workplace

Work, in its most base form, is all about inputs and outputs—an employee puts in a hard day’s work and in return gets financial compensation or some other type of salient reward. The world is built on this balance of inputs and outputs, though oftentimes the two are not symmetrical. Oftentimes, we find ourselves putting more into a job than we get out of it. Or perhaps we get way more out of a job than we actually put into it. This inequity can only exist for so long before something gives, either the input or the output. It is the job of both managers and workers to continually strive for balance and equity in our day-to-day jobs.

An employee’ perception of the equity that exists in his or her job has a correlation with that employee’s motivation and attitude, which ultimately affects their performance. By our very nature, humans seek equality and balance, and when we feel there is an imbalance, we seek to correct it by altering one side of the equation. If you’re a manager, you might be thinking that this is a pretty easy equation to control. Keep an open line of communication with followers and work to structure the equation in favor of high motivation!

Unfortunately, it is not that easy. Industrial psychology teaches us that it is often the idea of social comparison, something outside the manager’s control, that manipulates the equity equation most. Social comparison essentially means that employees will evaluate their own input/output ratios based on their comparison to other employees (known as comparative referents). Perception plays a huge role in this, as obviously your coworker may be putting more into the job or getting paid less than you imagine. Nevertheless, an employee will evaluate his or her own time, expertise, and quality of work against those of others, just as he or she will evaluate their own compensation with that of others’. If an inequity exists, the employee will take action. It has long been assumed that a typical employee will seek to be fairly compensated for what he or she believes they are investing in the job. When that compensation does not exist, the employee takes action in one of three ways. First, the employee will seek to alter their actual inputs or outputs. This includes working harder or less hard, altering the care and attention they pay to a task, or asking for a raise. Alternatively, an employee can alter those inputs or outputs in their own mind by changing the comparative referent.

Finally, an employee can choose to leave the organization. The equation is not so easy any more. It becomes even more difficult when we realize that employees view inputs and outputs in different ways. A younger employee may be willing to accept lesser pay in return for job security or work freedom. A new mother may consider taking a pay cut in return for a flexible schedule. Paying employees more for more work does not always lead to a successful outcome, either, as a worker may decide that the tasks he or she is currently doing are just worth more than they once were. By the same token, employees can be motivated to perform extraordinarily by the promise of one day achieving executive position and pay, but exorbitant executive pay can be a demotivation.

So what is an employee or manager to do? Well, fear not, because there are steps that can be taken. As a manager, if you notice that your employees are working hard and giving it their all, far more so than what they are being compensated for, you may feel as though you should give them a raise. Perhaps a raise is not an option, though, especially in this economy. Employees value praise, job security and positive engagement often just as much as monetary reward. A simple “thank you” or “we couldn’t do this without you” will go a long way to restoring the employee’s internal equity. You may also consider that workloads are distributed evenly and briefly mentioning in company meetings all that
everyone does so that employees are using more accurate social comparisons. Employees place great value on the social feedback of their teammates and clients, too. If a client tells you that they particularly enjoyed working with so-and-so, make sure you tell that person. Using this positive feedback as a springboard for more challenging work can also lead to desirable outcomes for the employee and the organization. Most people enjoy challenges and pursuing those challenges in autonomous, creative ways.

It is also important to learn as much as possible about your employees and realize that different types of people treat equity and inequity in different ways. For example, entitled people will always believe that they are worthy of more benefits than they actually are. Benevolent individuals, quite the opposite, enjoy giving more than receiving and prefer to be under-benefitted. Most people, however, are equity sensitive and prefer their own input/output ratios to be equal to those of their comparative referent. Knowing more about your employees and ascertaining what category they fall into will help you make more strategic management decisions. As an employee, keeping an open line of honest communication with one another and superiors is essential. Without communication—which in a work environment is essentially a transference of meaning—perception and social comparison will rarely align with reality.

Perhaps most importantly, equity is not something that anyone on either side of the employee/employer relationship should try to battle. It is an innate fact of human existence that we wish our contributions to be equal to our rewards. Contributions are measured differently between everyone, though, as are rewards. For some people, a reward is money; for others, it is the gratitude that stems from a job well done. As long as employees and managers are mindful of their own contributions and the rewards they receive or disperse, everyone will work together to achieve equity, a greater work balance, and as a result higher motivation and performance.

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