04-17-2025
A UC Riverside School of Business professor led a study on how sharing information about employee pay alters workplace relations. The study by Professor Boris Maciejovsky was published in the Journal of Business Ethics.
According to the study, disclosing employee compensation impacts “workplace ethics, motivation, and performance.” When employees learn how their wages compare to that of their peers, “feelings of entitlement—and the salary they believe they deserve—can rise or fall depending on how close they are to the top of the performance rankings lists.” (UCR News) Workers with high-performance rankings felt they should receive much higher compensation than employees with lower-performance rankings. These high-performance individuals were more likely to demand raises. Employees at the bottom felt “demoralized” and less likely to think they deserved a raise. The study raised ethical questions about how performance measures could impact employee motivation, collaboration, and perceptions of fairness. Maciejovsky cautioned organizations to “carefully consider” what information is shared with employees, “as the appropriateness” of the information may depend on an employee’s performance.
As pay transparency policies become more prevalent, this study tested whether these policies consistently improve outcomes in fairness and morale. States like California and websites like Glassdoor make it easier to learn salary information. This study “highlights a complex interplay between social comparison and individual perceptions of worth.” Employees look at how much others make and how close they are to being the top performers. The researchers support pay transparency because it reveals unfair disparities and aids in reducing systemic biases. They also encourage employers to invest in supporting a workplace culture that “values growth and contribution across all levels—not just those near the top.”