{"id":3923,"date":"2025-04-03T20:03:52","date_gmt":"2025-04-03T20:03:52","guid":{"rendered":"https:\/\/aomtodayprod.wpenginepowered.com\/?p=3923"},"modified":"2025-07-09T15:19:00","modified_gmt":"2025-07-09T15:19:00","slug":"transparency-helps-orgs-that-pay-employees-fairly","status":"publish","type":"post","link":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/","title":{"rendered":"Transparency Helps Orgs that Pay Employees Fairly"},"content":{"rendered":"

By Daniel Butcher<\/a><\/p>\n

Organizations with merit-based raises and bonuses deemed equitable by employees benefit from pay transparency by incentivizing top-tier performers to put in maximum effort and stay at the organization, while encouraging many bottom-tier performers to look for new jobs.<\/p>\n

\u201cThe bottom line, what we found is that people\u2019s perceptions of the fairness of pay in their organization had a big impact on the degree to which transparency was associated with higher or lower rates of turnover,\u201d Academy of Management Scholar Peter Bamberger<\/a> of Tel Aviv University said. \u201cAnd a lot of that can be explained by people\u2019s perceptions of trust.<\/p>\n

\u201cWhere employees have a sense that pay is distributed fairly, you get a lot of benefits from pay transparency with regard to reduced turnover, because essentially, in most cases, where people believe that pay is fair, pay transparency is showing that the pay is, in fact, fair,\u201d he said.<\/p>\n

\u201cAnd it\u2019s driving higher levels of trust, which encourage people to stay in the organization, and in those situations where people are feeling that the pay is unfair, it\u2019s typically people who are performing less well and are rewarded less well, transparency can be problematic, because then you’re actually making it obvious to them that they\u2019re not doing as well and they\u2019re likely to leave to look for greener pastures.\u201d<\/p>\n

In this way, Bamberger and colleagues were able to explain inconsistent findings regarding pay transparency and turnover in prior studies. They explained these mixed effects by showing that pay transparency can both increase and reduce turnover.<\/p>\n

\u201cFor people who are performing well in an organization and getting those higher rewards and feel that their pay is fair, transparency drives higher retention, but for those who are feeling that their pay is unfair, perhaps because they\u2019re getting lower rewards, typically transparency can actually drive higher rates of turnover,\u201d he said.<\/p>\n

Bamberger and his fellow researchers looked at employees\u2019 overall perceptions of pay fairness, regardless of what their frame of reference was in terms of level of seniority or job title.<\/p>\n

\u201cWhat we found is when the two are aligned, high transparency with high perceptions of justice, they\u2019re getting higher retention,\u201d he said. \u201cWhen there\u2019s high transparency with lower perceptions of justice, we were seeing higher levels of turnover.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

By Daniel Butcher Organizations with merit-based raises and bonuses deemed equitable by employees benefit from pay transparency by incentivizing top-tier performers to put in maximum effort and stay at the organization, while encouraging many bottom-tier performers to look for new jobs. \u201cThe bottom line, what we found is that people\u2019s perceptions of the fairness of […]<\/p>\n","protected":false},"author":4,"featured_media":4563,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[77,76],"tags":[],"sp_smart_badges":[],"ppma_author":[70],"class_list":["post-3923","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-pay","category-performance"],"acf":[],"yoast_head":"\nTransparency Helps Orgs that Pay Employees Fairly - Academy of Management Today<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Daniel Butcher\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/\"},\"author\":{\"name\":\"Daniel Butcher\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/#\\\/schema\\\/person\\\/d1297a59039d9ca7bac9d9f0952e508c\"},\"headline\":\"Transparency Helps Orgs that Pay Employees Fairly\",\"datePublished\":\"2025-04-03T20:03:52+00:00\",\"dateModified\":\"2025-07-09T15:19:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/\"},\"wordCount\":395,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.aom.org\\\/today\\\/wp-content\\\/uploads\\\/2025\\\/04\\\/pay-compensation-salary-bonus_shutterstock-scaled.jpg\",\"articleSection\":[\"PAY\",\"PERFORMANCE\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/\",\"url\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/\",\"name\":\"Transparency Helps Orgs that Pay Employees Fairly - Academy of Management Today\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.aom.org\\\/today\\\/wp-content\\\/uploads\\\/2025\\\/04\\\/pay-compensation-salary-bonus_shutterstock-scaled.jpg\",\"datePublished\":\"2025-04-03T20:03:52+00:00\",\"dateModified\":\"2025-07-09T15:19:00+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/#\\\/schema\\\/person\\\/d1297a59039d9ca7bac9d9f0952e508c\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/#primaryimage\",\"url\":\"https:\\\/\\\/www.aom.org\\\/today\\\/wp-content\\\/uploads\\\/2025\\\/04\\\/pay-compensation-salary-bonus_shutterstock-scaled.jpg\",\"contentUrl\":\"https:\\\/\\\/www.aom.org\\\/today\\\/wp-content\\\/uploads\\\/2025\\\/04\\\/pay-compensation-salary-bonus_shutterstock-scaled.jpg\",\"width\":2560,\"height\":1706,\"caption\":\"Source: Shutterstock\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/transparency-helps-orgs-that-pay-employees-fairly\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.aom.org\\\/today\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Transparency Helps Orgs that Pay Employees Fairly\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/#website\",\"url\":\"https:\\\/\\\/www.aom.org\\\/today\\\/\",\"name\":\"Academy of Management Today\",\"description\":\"Smarter, faster business news\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.aom.org\\\/today\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/#\\\/schema\\\/person\\\/d1297a59039d9ca7bac9d9f0952e508c\",\"name\":\"Daniel Butcher\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/085e55dd8b6bc186c84fe76ed72735ec1ce8396dff19755de507fb86659a8d08?s=96&d=mm&r=g559188980b254e0e0624aacb72ebc733\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/085e55dd8b6bc186c84fe76ed72735ec1ce8396dff19755de507fb86659a8d08?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/085e55dd8b6bc186c84fe76ed72735ec1ce8396dff19755de507fb86659a8d08?s=96&d=mm&r=g\",\"caption\":\"Daniel Butcher\"},\"description\":\"Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer\\\/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, as well as Crain Communications\u2019s InvestmentNews and Crain\u2019s Wealth, eFinancialCareers, and Arizent\u2019s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor\u2019s degree, Cum Laude, from the University of Colorado Boulder and his master\u2019s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.\",\"sameAs\":[\"https:\\\/\\\/aomtodayprod.wpenginepowered.com\",\"https:\\\/\\\/www.linkedin.com\\\/in\\\/danielbutcher\\\/\"],\"url\":\"https:\\\/\\\/www.aom.org\\\/today\\\/author\\\/daniel-butcher\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Transparency Helps Orgs that Pay Employees Fairly - Academy of Management Today","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/","twitter_misc":{"Written by":"Daniel Butcher","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/#article","isPartOf":{"@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/"},"author":{"name":"Daniel Butcher","@id":"https:\/\/www.aom.org\/today\/#\/schema\/person\/d1297a59039d9ca7bac9d9f0952e508c"},"headline":"Transparency Helps Orgs that Pay Employees Fairly","datePublished":"2025-04-03T20:03:52+00:00","dateModified":"2025-07-09T15:19:00+00:00","mainEntityOfPage":{"@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/"},"wordCount":395,"commentCount":0,"image":{"@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/#primaryimage"},"thumbnailUrl":"https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-scaled.jpg","articleSection":["PAY","PERFORMANCE"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/","url":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/","name":"Transparency Helps Orgs that Pay Employees Fairly - Academy of Management Today","isPartOf":{"@id":"https:\/\/www.aom.org\/today\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/#primaryimage"},"image":{"@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/#primaryimage"},"thumbnailUrl":"https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-scaled.jpg","datePublished":"2025-04-03T20:03:52+00:00","dateModified":"2025-07-09T15:19:00+00:00","author":{"@id":"https:\/\/www.aom.org\/today\/#\/schema\/person\/d1297a59039d9ca7bac9d9f0952e508c"},"breadcrumb":{"@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/#primaryimage","url":"https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-scaled.jpg","contentUrl":"https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-scaled.jpg","width":2560,"height":1706,"caption":"Source: Shutterstock"},{"@type":"BreadcrumbList","@id":"https:\/\/www.aom.org\/today\/transparency-helps-orgs-that-pay-employees-fairly\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.aom.org\/today\/"},{"@type":"ListItem","position":2,"name":"Transparency Helps Orgs that Pay Employees Fairly"}]},{"@type":"WebSite","@id":"https:\/\/www.aom.org\/today\/#website","url":"https:\/\/www.aom.org\/today\/","name":"Academy of Management Today","description":"Smarter, faster business news","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.aom.org\/today\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.aom.org\/today\/#\/schema\/person\/d1297a59039d9ca7bac9d9f0952e508c","name":"Daniel Butcher","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/085e55dd8b6bc186c84fe76ed72735ec1ce8396dff19755de507fb86659a8d08?s=96&d=mm&r=g559188980b254e0e0624aacb72ebc733","url":"https:\/\/secure.gravatar.com\/avatar\/085e55dd8b6bc186c84fe76ed72735ec1ce8396dff19755de507fb86659a8d08?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/085e55dd8b6bc186c84fe76ed72735ec1ce8396dff19755de507fb86659a8d08?s=96&d=mm&r=g","caption":"Daniel Butcher"},"description":"Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer\/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, as well as Crain Communications\u2019s InvestmentNews and Crain\u2019s Wealth, eFinancialCareers, and Arizent\u2019s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor\u2019s degree, Cum Laude, from the University of Colorado Boulder and his master\u2019s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.","sameAs":["https:\/\/aomtodayprod.wpenginepowered.com","https:\/\/www.linkedin.com\/in\/danielbutcher\/"],"url":"https:\/\/www.aom.org\/today\/author\/daniel-butcher\/"}]}},"authors":[{"term_id":70,"user_id":4,"is_guest":0,"slug":"daniel-butcher","display_name":"Daniel Butcher","avatar_url":{"url":"https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/01\/DanButcher_Academy-of-Management.webp","url2x":"https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/01\/DanButcher_Academy-of-Management.webp"},"0":null,"1":"","2":"","3":"","4":"","5":"","6":"","7":"","8":""}],"rttpg_featured_image_url":{"full":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-scaled.jpg",2560,1706,false],"landscape":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-scaled.jpg",2560,1706,false],"portraits":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-scaled.jpg",2560,1706,false],"thumbnail":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-150x150.jpg",150,150,true],"medium":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-300x200.jpg",300,200,true],"large":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-1024x682.jpg",800,533,true],"1536x1536":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-1536x1024.jpg",1536,1024,true],"2048x2048":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-2048x1365.jpg",2048,1365,true],"owl_elementor_thumbnail":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-600x400.jpg",600,400,true],"owl_elementor_team":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-350x450.jpg",350,450,true],"owl_elementor_testimonial":["https:\/\/www.aom.org\/today\/wp-content\/uploads\/2025\/04\/pay-compensation-salary-bonus_shutterstock-100x100.jpg",100,100,true]},"rttpg_author":{"display_name":"Daniel Butcher","author_link":"https:\/\/www.aom.org\/today\/author\/daniel-butcher\/"},"rttpg_comment":0,"rttpg_category":"<a href=\"https:\/\/www.aom.org\/today\/category\/pay\/\" rel=\"category tag\">PAY<\/a> <a href=\"https:\/\/www.aom.org\/today\/category\/performance\/\" rel=\"category tag\">PERFORMANCE<\/a>","rttpg_excerpt":"By Daniel Butcher Organizations with merit-based raises and bonuses deemed equitable by employees benefit from pay transparency by incentivizing top-tier performers to put in maximum effort and stay at the organization, while encouraging many bottom-tier performers to look for new jobs. \u201cThe bottom line, what we found is that people\u2019s perceptions of the fairness of…","_links":{"self":[{"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/posts\/3923","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/comments?post=3923"}],"version-history":[{"count":0,"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/posts\/3923\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/media\/4563"}],"wp:attachment":[{"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/media?parent=3923"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/categories?post=3923"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/tags?post=3923"},{"taxonomy":"sp_smart_badges","embeddable":true,"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/sp_smart_badges?post=3923"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/www.aom.org\/today\/wp-json\/wp\/v2\/ppma_author?post=3923"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}