How do situations influence the effects of financial incentives?
Answer
If pay differs in an industry, it is more imortant to employees
Advantages of paying more than the market are less extreme than disadvantages of paying below the market
Pay cuts lead to: Theft, calling in sick, slacking off (less effect when good explained and remorse shown)
Comments
--> Situational Contingencies
- Pay is more important in job choice than in decision to quit (one of the upfront information people get)
- Pay will only little motivate when pay is not increased based on performance