Pay Communication, Justice, And Affect: The Asymmetric Effects Of Process And Outcome Pay Transparency On Counterproductive Workplace Behavior

Grounded on uncertainty management theory, the current research examines the role of employee justice perceptions in explaining the distinct effects of two forms of pay transparency-process versus outcome pay transparency- on counterproductive workplace behavior (CWB). Study 1, a field study of 321 employees, revealed that process pay transparency is inversely related to CWB targeting the organization ( i.e., less CWB-O), with this effect explained by enhanced employee procedural justice perceptions. It also indicated, however, that among employees perceiving their pay position as being lower than that of referent others, outcome pay transparency is positively associated with both CWB-O and CWB- I (i.e., CWB targeting other employees), with this effect explained by reduced employee distributive justice perceptions. Study 2, using an online simulation-based experiment conducted on 394 employees and assessing actual deception behaviors (targeting both the agency sponsoring the study and other participants in the study), replicated these findings and extended our understanding of the negative consequences of outcome pay transparency on CWB. Specifically, when pay allocations were transparent (vs. secretive) and participant's pay was manipulated to be lower (vs. higher) than that of teammates, participants reported lower distributive justice perceptions leading to heightened deception behaviors, with this effect explained by a more negative emotional state. Theoretical and practical implications of both the positive and negative consequences of pay transparency on CWB are discussed.