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The antecedents of satisfaction with pay in teams: do performance-based compensation and autonomy keep team-members satisfied?

Ana-Maria Godeanu ()
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Ana-Maria Godeanu: Department of Business Administration, Universidad Carlos III of Madrid, Spain

Eastern Journal of European Studies, 2012, vol. 3(1), pages 145-168

Abstract: This paper aims to investigate the effects performance-based compensation and autonomy on satisfaction with pay in the context of team working. I develop a complex perspective that considers the influence of different monetary and non-monetary rewards on satisfaction with pay. Drawing from the agency theory, equity theory and theory of cooperation I predict that both piece rates and team-based rewards are associated with higher pay satisfaction. Moreover, I claim that both individual and team-based autonomy contribute to increased satisfaction with pay. Using a cross-sectional dataset of randomly selected European employees who are asked about specific working and living conditions, results confirm that both productivity-based rewards and autonomy are important for employee satisfaction. Managers should know when to introduce rewards based only on individual merits and when to give to use autonomy as a buffer to compensate for the potential lack of fairness in the payment system.

Keywords: performance-based compensation; agency theory; equity theory; pay satisfaction; employee autonomy. (search for similar items in EconPapers)
Date: 2012
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Persistent link: http://EconPapers.repec.org/RePEc:jes:journl:y:2012:v:3:p:145-168

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