Jenna R. Pieper

Pay-for-Performance’s Effect on Future Employee Performance Integrating Psychological and Economic Principles Toward a Contingency Perspective

Although pay-for-performance’s potential effect on employee performance is a compelling issue, understanding this dynamic has been constrained by narrow approaches to pay-for-performance conceptualization, measurement, and surrounding conditions. In response, we take a more nuanced perspective by integrating fundamental principles of economics and psychology to identify and incorporate employee characteristics, job characteristics, pay system characteristics, and pay system experience into a contingency model of the pay-for-performance–future performance relationship. We test the role that these four key contextual factors play in pay-for-performance effectiveness using 11,939 employees over a 5-year period. We find that merit and bonus pay, as well as their multiyear trends, are positively associated with future employee performance. Furthermore, our findings indicate that, contrary to what traditional economic perspectives would predict, bonus pay may have a stronger effect on future performance than merit pay. Our results also support a contingency approach to pay-for-performance’s impact on future employee performance, as we find that merit pay and bonus pay can substitute for each other and that the strength of pay-for-performance’s effect is a function of employee tenure, the pay-for-performance trend over time, and job type (presumably due to differences in the measurability of employee performance across jobs).

Referral Hire Presence Implications for Referrer Turnover and Job Performance

A great deal of research has been devoted to understanding the organizational returns of employee referral programs, particularly with respect to outcomes involving those hired through the referral process. Yet, no work has addressed whether the presence of a referral hire (i.e., the referred candidate who is hired and working in the firm) is related to behavioral outcomes for the referrer. Drawing on the social enrichment perspective, we theorize how referral hire presence (RHP), which is the time during which the referrer’s and the referral hire’s employment spells overlap, impacts referrer behavior. Using data from 265 referrers in a U.S. call center, we found that RHP was negatively related to referrer voluntary turnover and positively related to referrer job performance. Further, results from a supplemental experimental study supported our social enrichment rationale for the field study relationships, as the construct was associated with both RHP and additional attitudes known to be proximal predictors of turnover and performance. We also explore boundary conditions for the RHP effect in the call center data, revealing a nuanced mix of moderators of RHP effects. Overall, our findings provide the first evidence for the role of social enrichment, possible modifications to the well-established social enrichment perspective in the workplace, and evidence that understanding the impact of referral hiring necessitates careful consideration of the behavioral consequences for the referrer.

Perceived Workplace Gender Discrimination and Employee Consequences: A Meta-Analysis and Complementary Studies Considering Country Context

We draw on relative deprivation theory to examine how the context influences the relationship between employees’ perceptions of gender discrimination and outcomes at work using a meta-analysis and two complementary empirical studies. Our meta-analysis includes 85 correlations from published and unpublished studies from around the world to assess correlates of perceived workplace gender discrimination that have significant implications for employees. We extend relative deprivation theory to identify national differences in labor laws and cultural norms as contextual factors that affect the threshold for feeling deprived and moderate the relationship between perceived workplace gender discrimination and employee outcomes. Findings show that perceived gender discrimination is negatively related to job attitudes, physical health outcomes and behaviors, psychological health, and work-related outcomes (job-based and relationship-based). Correlations between perceived workplace gender discrimination and physical health outcomes and behaviors were stronger in countries with more broadly integrated labor policies and stringently enforced labor practices focused on promoting gender equality. Correlations were also stronger in countries with more gender-egalitarian cultural practices across multiple employee outcomes of perceived workplace gender discrimination. Further, results from two complementary studies (one employee survey and one experiment) supported the meta-analytic findings and provided evidence of the relative deprivation rationale central to our theory. Implications for research and practice include the need to consider the influence of the country context in organizational decisions to prevent and address gender discrimination and its consequences for employees and ultimately, for employers.