Effects of pay transparency: A multi-level perspective

Executive Summary

Pay transparency is a topic widely discussed among scholars, HR decision makers, employees, politicians, and the wider public. Even though organizations are increasingly being pressured to open up about pay, scientific evidence on the effects of pay transparency is conflicting. Some research finds positive effects of pay transparency, such as better task performance, greater likelihood that group members will seek help, stronger intention to continue with a task, and a lower gender-pay gap. However, other work provides evidence for negative outcomes of pay transparency, such as higher turnover intention, reduced helping behavior, and more cheating. The evidence to date suggests that pay transparency can be beneficial under certain circumstances and a threat under others. To better understand these mixed findings, we aim at untangling the complex mechanisms and contingencies through which pay transparency affects employees’ attitudes and behaviors. Our proposed multi-level research project contributes in a timely way to the debate on how and under which conditions pay transparency influences employees’ attitudes and behaviors in a team.

Our project will derive recommendations for an efficient implementation of pay transparency. In addition, the project provides an important research contribution by distinguishing between three different aspects of pay transparency and empirically validating these pay transparency aspects.

Project leader: Dr. Alexandra Arnold
Phone: +41 41 229 58 65

Project member: Dr. Anna Sender
Phone: +41 41 229 58 62