PurposeResearch on effort-reward “imbalance” (ERI) has gained popularity in the occupational health literature, and authors typically use effort-reward ratios (ERRs) to study this phenomenon. This article provides a methodological and theoretical critique of this literature and suggestions on how future research can better study joint effects of efforts and reward.Design/methodology/approachThe authors conducted a simulation study, analyzed panel data and surveyed the literature on the theoretical and methodological basis of the “imbalance” concept.FindingsThe simulation study indicates that under many conditions the ERR captures main effects of effort and reward and that effects also depend on the scaling of the variables. The panel data showed that when main effects and the interactions of effort and reward are entered simultaneously in a regression predicting mental and physical health, the significant effect of the ERRs disappears. The literature review reveals that psychological theories include more elaborate theoretical ideas on joint effects of effort and reward.Research limitations/implicationsThe results suggest that moderated multiple regression analyses are better suited to detect a misfit between effort and reward than ERRs. The authors also suggest to use the term effort-reward fit in future research.Originality/valueMethodologically and conceptually the authors showed that the ERR is not an appropriate approach because it confuses main effects with interaction effects. Furthermore, the concept of ERI is better substituted by a broader conceptualization of effort-reward fit that can be integrated with the existing literature on person-environment fit. Recommendations for future research are provided.