Team Member Work Role Performance: The Organizational Benefits From Performance-Based Horizontal Pay Dispersion and Workplace Benign Envy

Abstract

In the context of the current uncertain, complex, and interdependent work systems, teams have become organizations’ substantial working unit, which in turn challenges the traditional view of employee performance and ultimately results in the emergence of team member work role performance. Employee team-oriented work role behaviors with proficiency, adaptivity, and proactivity, which are integrated by the new construct, are so crucial to team effectiveness that many organizations keenly expect to achieve team member work role performance through implementing a dispersed pay-for-performance plan within a team. This study seeks to address the organizational practitioners’ main concern that whether pay dispersion among team members (i.e., horizontal pay dispersion, HPD) could actually help realize team member work role performance and further examines why and when an employee could respond to HPD within a team by engaging in team member work role behaviors from the perspective of the performance-shaping basis and team member’s workplace benign envy. Drawing on emotion-related theory, social comparison theory, legitimacy theory, expectation theory, and relative deprivation theory, it proposes that performance-based HPD could not only positively impact team member work role performance via workplace benign envy but also exert a direct-positive effect. Moreover, the activating effect of performance-based HPD on workplace benign envy and the mediating role are much stronger when a team member’s pay position is higher. The multi-source data including objective information and subjective perception among 362 ordinary employees within 66 Chinese organizational teams primarily supported the moderated mediation model. Yet, the direct-positive effect was not established.

Does workplace envy always have detrimental consequences in organizations? A study of public and private sector employees

“…With this study, we argue that envy can have a significant impact on employees' job performance. In the literature, some of the studies on workplace envy and job performance relation were conducted within the frame of typological approach (De Clercq et al , 2018; Aydın-Küçük and Taştan, 2019; Lee and Duffy, 2019; Khan and Noor, 2020; Zhang et al , 2020) mostly indicating malicious envy related to poor performance whereas benign envy to improvement in performance. Although there also exists a recent interest in the situational approach, a limited number of studies are available in the literature (Eissa and Wyland, 2016; Lee et al , 2018; Treadway et al , 2019; Shousha, 2020; Tariq et al , 2019) that show how envying others and being envied can contribute to employees' job performance.…”

Effects of CEO Identity on Non-family Managers’ Pay Dispersion in Family Firms: A Social Comparison Perspective

“…If they receive far less compensation than their fellows, in other words, the pay dispersion is large, this will lead to a feeling of inequity. The assessment of inequity can lead to a feeling of injustice and jealousy, which in turn may reduce team cohesion and decrease job satisfaction (Collischon and Eberl, 2020), and even lower firm performance (Patel et al, 2018;Zhang et al, 2020). Conversely, if managers get relatively equal compensation with others, these managers may generate a perception of fair treatment, which in turn improves team collaboration and firm performance.…”

“…By establishing a general view of managerial pay dispersion research, studies on how managerial pay dispersion influences firm behavior such as firm performance (Jaskiewicz et al, 2017;Patel et al, 2018;Zhang et al, 2020), executive turnover (Ridge et al, 2017), and firm innovation (Yanadori and Cui, 2013;Amore and Failla, 2020) have been well researched. For firm performance, Jaskiewicz et al (2017) investigated this issue in family firms and found that pay dispersion among non-CEO top management team members could harm firm performance.…”

“…Compensation, as an initial symbol of a manager's human capital value and social status (Main et al, 1993), becomes an important object of social comparison. Social comparison theory states that individuals focus on comparing their compensation to determine whether they receive fair treatment (Festinger, 1954;Fredrickson et al, 2010), and higher pay dispersion could lead to lower firm performance (Jaskiewicz et al, 2017;Patel et al, 2018;Zhang et al, 2020), or increased managerial turnover (Ridge et al, 2017;Kacperczyk and Balachandran, 2018). However, under the framework of social comparison theory, few studies have focussed on the factors that influence managerial pay dispersion in family firms.…”

Detrimental Effect of the Characteristic-Human-Capital-Inputs-Based Horizontal Pay Dispersion on Team Member Work Role Performance via Employee Benign and Malicious Envy: An Evidence from China

“…Scholars up to now have explored HPD’s impacts on employee effort and engagement, 3–5 workforce productivity, 6 firm’s financial performance, 7 innovation performance, 8 trust, 9 affective commitment and turnover, 10 motivation, 11 and behavioral performance. 12 However, these studies have not reached unanimous conclusions. Taking the possible effect of HPD on employee effort for example, some researchers failed to find empirical evidence of positive or negative impact, 3 , 4 whereas, other researchers revealed that as HPD becomes larger, employee effort goes up and employee sabotage behavior turns stronger.…”