Pay equity - Equal pay - Pay satisfaction

Pay equity can be perceived differently by two people with the same salary. There will never be absolute pay equity! Pay satisfaction is the individual perception of each employee in relation to their life situation.
Pay equity - equal pay:
Jean Stacy Adams, who published his studies on employee motivation in the 1960s, put forward the following theories: An employee constantly makes comparisons between his performance for the company (inputs) and the outputs received from the company in return (e.g. salary, security, status, social benefits) and the inputs of his colleagues and their outputs. The employee's behaviour and motivation depend on whether he or she feels treated fairly or unfairly towards his or her colleagues. Different situations can occur between employee A and comparator V. The prerequisite is the same wage:
- Satisfaction with A and V if input and output are the same,
- Dissatisfaction A or V, because input and output are different.
This means that even with equal pay, pay inequality can arise if the comparator V (output/input > A) recognises this.
If the feeling of injustice has arisen, employee A tries to bring about a situation that is perceived as fair by changing his input, by influencing the comparator or the employer with regard to the output. He can also choose another comparator or refrain from further comparisons, which is tantamount to resignation and will indirectly lead to the employee leaving the company.
From this simple motivation theory, it can be concluded that the employer should always endeavour to create a situation of equality or fairness between employees.
Salary satisfaction:
In my day-to-day work as a recruitment consultant, I notice that every candidate has a different salary expectation for the identical position. From this I conclude that every person has a different level of salary satisfaction for an identical job. Depending on life situation and age, the incentives, salary, task, team, development potential, etc. are weighted differently. However, this weighting can change after employment, e.g. because not all the facts were known. Conversely, the employer also has an individual idea of the salary to be paid for a particular position. This idea is usually characterised by economic considerations and based on the expected performance of the candidate. The above theory by Jean Stacy Adams is also applicable here. If the mutual expectations are met after the salary negotiation, all parties are satisfied. If there is a discrepancy, either the employer or the employee will be dissatisfied, which in the worst case will lead to separation in the medium term.
I therefore recommend more transparency and flexibility in salary negotiations and salary systems:
- Candidates should set themselves a medium-term benchmark of their own salary satisfaction and be sure to get an idea of how the mechanisms of value creation are in the new company and how they can positively influence value creation through their performance. In addition, candidates should be open to a performance-related (fixed/variable) salary in order to ease the pressure of mutual expectations.
- Employees should offer their candidates a fair, performance-related salary with a variable component and highlight the development potential in relation to individual qualitative and quantitative targets.
- These recommendations will result in a fair and relaxed salary discussion for both sides, which will lead to a high level of satisfaction on both sides.
Salary is not everything, but neither is salary dissatisfaction.
For the sake of simplicity, only the masculine form has been used in the text. Of course, all genders are included.