Learning about Pay at Work: A Labour Process Approach to Pay Transparency

Abstract

Using a labour process approach, this article examines how workers in three factories in China learnt about the workplace-level pay systems governing their employment relationships. By outlining the processes through which workers learnt about pay at work, this article sheds light on how workers, faced with a perplexing variable pay system and managerial control over pay disclosure, can overcome the pathways towards ignorance and ultimately challenge the workplace-level pay communication regime. It is shown that pay transparency, rather than being merely an outcome of managerial practices to improve employee motivation and organisational performance, is an outcome of dynamic and contested social interactions between management and labour.

What does democratic management do in Chinese workplaces? Evidence from matched employer–employee data

“…This mechanism is not formally tested in related previous literature (Addison et al., 2010). Our findings also support several studies on the power of workplace transparency (Estlund, 2014a; Tse, 2022), implying that mandatory information disclosure could be used to protect workers' welfare in the face of the crumbling power of their collective voice. On the other hand, DM is associated with favourable IRC, echoing Huang et al.…”

“…Due to the above‐mentioned DM functions, employees in DM firms are more likely to have access to information regarding firms' strategy and operation, company bylaws, and pay‐related issues (Estlund, 2014b). In contrast, in non‐DM firms, such information disclosure is often acknowledged as an employer prerogative and remains under managerial control (Li & Qi, 2014; Tse, 2022). In these firms, employers would either selectively withhold such information or create bureaucratic procedures for making enquiries (Tse, 2022), resulting in limited information being accessible to employees.…”

“…In contrast, in non‐DM firms, such information disclosure is often acknowledged as an employer prerogative and remains under managerial control (Li & Qi, 2014; Tse, 2022). In these firms, employers would either selectively withhold such information or create bureaucratic procedures for making enquiries (Tse, 2022), resulting in limited information being accessible to employees. Thus, we hypothesise as follow:…”

“…It ensures better employer compliance to legal mandates. Limited access to pay and employment information constrains employees' ability to identify potential incidents of underpayment, unpaid overtime work, working hour trickery, and violations in social security payments (Li & Qi, 2014; Tse, 2022). In contrast, when information regarding pay‐determination, working hours, and employment terms are accessible to the rank and file, employees can uncover inconsistencies and make unwitting violations more obvious (Estlund, 2014a).…”

“…Employers are generally free to develop individualised pay strategies that may lead to greater pay disparities related to personal attributes (Li & Qi, 2014). In workplaces where employees are informed about the salary-structure-related bylaws, unexplained and discrimination-based salary disparities become more obvious (Tse, 2022), which would encourage employers to adjust their salary structures to avoid dampening employee morale and commitment (Estlund, 2014a). Such changes would favour employees who are underpaid relative to comparable workers, who are less astute negotiators, and who are not the boss's favourite.…”