SPHR · Question #29
When applying equity theory in designing a compensation strategy, an employer needs to ensure that:
The correct answer is D. Employees perceive that pay is equal to effort. Equity Theory suggests employees evaluate fairness by comparing their inputs (effort) to their utputs (pay, recognition) relative to others. If they perceive inequity, it can lead to disengagement Extract from HRCI-aligned HR knowledge (Total Rewards): SPHR-level compensation…
Question
When applying equity theory in designing a compensation strategy, an employer needs to ensure that:
Options
- APay is tightly linked to organizational objectives
- BEmployees choose the behavior that leads to the greatest reward
- CRewards follow directly after behaviors to reinforce them
- DEmployees perceive that pay is equal to effort
How the community answered
(22 responses)- A5% (1)
- D95% (21)
Explanation
Equity Theory suggests employees evaluate fairness by comparing their inputs (effort) to their utputs (pay, recognition) relative to others. If they perceive inequity, it can lead to disengagement Extract from HRCI-aligned HR knowledge (Total Rewards): SPHR-level compensation design includes psychological models like "Adams' Equity Theory," which explains that perceived fairness in effort-reward balance is essential to motivation and
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