PAY SYSTEM CHARACTERISTICS AND QUIT PATTERNS OF GOOD, AVERAGE, AND POOR PERFORMERS

By Jason D. Shaw, N. Gupta. 2007

177 citations recorded by the source corpus.

The relationship between pay dispersion and the quits patterns of good, average, and poor performers was explored among a sample of motor carriers. Results showed that under high pay system communication, pay dispersion was negatively related to good performer quits when performance-based pay increases were emphasized, and positively related when they were not. The results for seniority-based pay increases were different. Under high pay system communication, pay dispersion was negatively related to average performer quits when seniority-based pay increases were emphasized, and the relationship was attenuated when they were not. Contrary to expectation, pay dispersion was not consistently related to quit patterns when pay system communication was low. Predictions regarding quit patterns of poor performers were not supported. Implications of the research are addressed and future research directions identified. There is general agreement in the literature that pay dispersion among key employees (horizontal or within-group pay dispersion) relates to turnover levels in organizations. This assumption goes back at least a half-century (e.g., Livernash, 1957), but theory and empirical findings to date are ambiguous about the specific nature of the relationship. Instead, existing theory and empirical results continue to offer contradictory or competing insights about the effects of pay dispersion on organizational outcomes, leading some to refer to the situation as a theoretical dilemma This study was funded by a grant from the SHRM foundation. The interpretation, conclusions, and recommendations, however, are those of the authors, and do not necessarily represent those of the foundation. An earlier version of this paper was presented at the 2001 annual meetings of the Southern Management Association. We thank Associate Editor Murray Barrick, two anonymous reviewers, Michelle Duffy, Ruolian Fang, Robert Vellella, Jing Zhu, Sven Kepes, Jackie Thompson, and seminar participants at The Ohio State University for helpful comments. Correspondence and requests for reprints should be addressed to Jason D. Shaw, Uni

Subfields: Demography, Organizational Behavior and Human Resource Management, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/f2b746bdfb67add8433ca38e8661042716e072e5

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Citations in the corpus

Signaling in Secret: Pay-for-Performance and the Incentive and Sorting Effects of Pay Secrecy (2014, background): “Similarly, when organizations communicated the nature of performance-based pay contingencies, Shaw and Gupta (2007) found stronger PFP contingencies (manifested in higher pay dispersion) to be positively associated with the retention of high performers.”
Minding the Gap (2016, background): “In this way, pay dispersion can reduce cooperation, productivity, commitment, and retention (Bolino & Turnley, 2008; Shaw & Gupta, 2007; Trevor & Wazeter, 2006).”
What Is Wrong With Treating Followers Differently? The Basis of Leader–Member Exchange Differentiation Matters (2018, background): “…empirical findings alike demonstrate that pay dispersion (differentiation) is not evil per se; it has corrosive effects on individual and group outcomes only when it is not based on employee inputs, such as task performance or seniority (J. D. Shaw & Gupta, 2007; Trevor, Reilly, & Gerhart, 2012).”
6 Pay and Performance: Individuals, Groups, and Executives (2009, background): “interdependence, reward systems, and performance may be even more complicated than suggested by Shaw et al. (2002). For example, Siemsen, Balasubramanian, and Roth (2007) used mathematical logic to argue that the appropriate team reward system depends on the nature of the dependency (i.”
Collective Turnover at the Group, Unit, and Organizational Levels: Evidence, Issues, and Implications (2011, background): “…& Colvin, in press; Batt et al., 2002; Bennett et al., 1993; Cappelli & Neumark, 2004; Guthrie, 2001; Haines et al., 2010; Huselid, 1995; Park et al., 1994; Shaw et al., 1998; Shaw et al., 2009; Shaw & Gupta, 2007; Shaw, Gupta, et al., 2005; Trevor & Nyberg, 2008; Way, 2002; Yanadori & Kato, 2007).”
Individuals, interactions and institutions: How economic inequality affects organizations (2015, background): “can be effectively tied to performance (Shaw and Gupta, 2007; Shaw et al., 2002).”
Employee-Organization Exchange Relationships, HRM Practices, and Quit Rates of Good and Poor Performers (2009, methodology): “Although this prior study used our measures of good- and poor-performer quits at time 2, none of the substantive independent variables in the current study overlap with Shaw and Gupta (2007).”
Strategic HRM in North America: looking to the future (2008, unknown): “1998 ; Batt 2002 ; Shaw and Gupta, in press ), recently there has been a spate of research examining additional proximal outcomes of HRM systems or mediators between HRM systems and distal performance outcomes.”
Pay-for-Performance’s Effect on Future Employee Performance (2016, background): “…in part, because (a) monetary rewards are the most efficacious incentives (Locke, Feren, McCaleb, Shaw, & Denny, 1980), (b) PFP can direct action (Shaw & Gupta, 2007) and attitudes (Fulmer, Gerhart, & Scott, 2003), and (c) firms often have more discretion in setting PFP than in setting pay level…”
Managing the academic talent void: Investigating factors in academic turnover and retention in South Africa (2014, background): “Turnover has traditionally been viewed as a negative phenomenon that needs to be managed in order for the organisation to remain effective (Shaw & Gupta, 2007).”
A SOCIAL-STRUCTURAL PERSPECTIVE ON EMPLOYEE- ORGANIZATION RELATIONSHIPS AND TEAM CREATIVITY (2014, background): “…such as profit sharing, stock options, bonuses, and other types of incentives, which are important to workers in developing economies like China and are shown to have important effects on performance (Jenkins, Mitra, Gupta, & Shaw, 1998) and quit patterns (Shaw & Gupta, 2007) in other contexts.”