Pay Perceptions and Their Relationships with Cooperation, Commitment, and Intent to Quit

The impact of pay understanding on pay satisfaction and retention: Salary sacrifice understanding in the not-for-profit sector

“…Kisilevitz et al (2006), for example, claim that improved pay understanding, as a consequence of better pay communication, can increase pay satisfaction by up to 40%. This effect also extends to increased organisational commitment and engagement, as well as employee retention (Brown and Huber, 1992;Shields et al, 2012;Sweins and Kalmi, 2008;Williams et al, 2006). Thus, an organisation can improve employee and employer outcomes merely by providing better explanations of the various components, such as incentive schemes, annual increments and performance-related bonuses, as well as those benefits that are linked into broader legislative frameworks, such as superannuation, salary sacrificing and social security benefits.…”

“…Improved pay satisfaction is understood to have a positive impact on employee attitudes (such as satisfaction and organisational commitment) and behaviours (such as absenteeism and employee engagement), and a negative association with employee turnover (Currall et al, 2005;Miceli and Mulvey, 2000;Shields et al, 2012;Singh and Loncar, 2010) (see Figure 1). …”

“…Researchers have highlighted the positive relationship between employee pay communication and employee pay understanding and satisfaction (Berkowitz et al., 1987; Day, 2011; Kisilevitz et al., 2006; Mulvey et al., 2002; Shields et al., 2012). Improved pay satisfaction is understood to have a positive impact on employee attitudes (such as satisfaction and organisational commitment) and behaviours (such as absenteeism and employee engagement), and a negative association with employee turnover (Currall et al., 2005; Miceli and Mulvey, 2000; Shields et al., 2012; Singh and Loncar, 2010) (see Figure 1).

Figure 1.The relationship between pay communication, pay understanding, employee attitudes and outcomes and leaving intention.

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“…Researchers have demonstrated that improved employee understanding of how they are paid leads to increased employee pay and job satisfaction, improved organisational performance and reduced employee turnover (Day, 2011; Shields et al., 2012; Singh and Loncar, 2010; Sweins and Kalmi, 2008; Williams et al., 2006). This research has found that employee pay understanding can be positively or negatively influenced by employer communication about how the different facets of remuneration are determined (Dow et al., 2008).…”

Pay Dissatisfaction and Intention to Leave

“…The literature has demonstrated that pay satisfaction has a negative association with employee intention to leave (DeConinck and Stilwell ; Shields et al ; Vandenberghe and Tremblay ). Cotton and Tuttle's () meta‐analysis found that pay and pay satisfaction were negatively associated with turnover in twenty‐nine out of thirty‐two studies.…”