4. Adams Equity Theory in the Workplace

4.1 Adams Equity Theory 

Figure 1: Adams Equity theory

Source: (Mulder, 2018).

Adam’s equity theory revolved from the social comparison theory and is considered one of the most popular social exchange theories. Furthermore that the degree of equity or inequity is a major input into job performance and the satisfaction that people perceive in their work situation. (Tudor, 2011). Therefore theory helped to provide the basis for studying the motivational implications of perceived unfairness and injustice in the workplace. In addition laid the foundation for more recent theories on and procedural justice such as how rewards and job requirements are determined (Armstrong and Taylor, 2014).

In a meta-analysis of many of these theories, Cohen-Charash and Spector (2001) found that both distributive and procedural justice were related to job performance, job satisfaction and the intention to quit. People make judgments or comparisons between their own inputs at work, for instance their qualifications, experience and effort, and the outcomes they receive, for instance pay and fringe benefits, status and working conditions. Then assign weights to these inputs and outputs according to their relevance and importance to themselves. The summed total produces an output or input ratio, which is the key issue in terms of motivation. If a person’s output or input ratio is equal to that of another person, equity exists. A state of inequity leads to tension, which the individual tries to reduce by changing one or more elements of the ratio, such as increase or reduce individual effort. Perceived inequity by the person is therefore the basis for motivation (Baron et al., 2002).

4.2 Application of Adams Equity Theory 

Silicon Valley Company under this study was conducted completely online with 135 employees who share a similar cultural background of growing up at the same time. An online survey was looking at job satisfaction, job expectations, perk usage, employee perception of perks, personal equity sensitivity and comparison.

Found out that original hypotheses not supported job satisfaction weight on job expectation while individual differences in equity did not weight perk usage, perceptions of job expectations (Sun, 2016).

Equity theory has stimulated much researches in different forms of equity such as pay equity, pay level equity, pay administration equity, procedural and distributive justice, job security and complexity, promotion opportunities equity, and evaluation criteria equity, but there has been a decline in interest of late because of its inability to predict people’s perception of the equitability of their specific situation. Nevertheless, it has served to direct attention to the importance of treating employees fairly and the consequences of failing to do (Spector, 2003). Furthermore the theory has a strong link to stress, burnout, turnover and job satisfaction (Test et al., 2003).

Video1: Equity theory of motivation

Source: (Powtoon, 2018).

4.3 List of References

Armstrong, M. and Taylor, S., 2014. Armstrong’S Handbook Of Human Resource Management Practice. 13th ed. London: Kogan page, pp. 97-104.

Baron, H., Henley, S., McGibbon, A. and McCarthy, T., 2002. Motivation Questionnaire Manual And User’s Guide. Brighton: Saville and Holdsworth Limited.

Cohen-Charash, Y. and Spector, P., 2001. The Role of Justice in Organizations: A Meta-Analysis. Organizational Behavior and Human Decision Processes, [online] 86(2), pp.278-321. Available at: <https://www.researchgate.net/publication/259706797_The_Role_of_Justice_in_Organizations_A_Meta-Analysis> [Accessed 26 May 2020].

Mulder, P., 2018. Adams Equity Theory. [image] Available at: <https://www.toolshero.com/psychology/adams-equity-theory/> [Accessed 26 May 2020].

Powtoon, 2018. Equity Theory Of Motivation. [video] Available at: <https://www.youtube.com/watch?v=7lsjGlfHXAs> [Accessed 26 May 2020].

Spector, P., 2003. Industrial And Organizational Psychology. 3rd ed. New York: J. Wiley & Sons.

Sun, K., 2016. The Power Of Perks: Equity Theory And Job Satisfaction In Silicon Valley. Scripps Senior Theses.

Test, D., Flowers, C., Hewitt, A. and Solow, J., 2003. Statewide Study of the Direct Support Staff Workforce. Mental Retardation, [online] 41(4), pp.276-285. Available at: <https://meridian.allenpress.com/idd/article-abstract/41/4/276/8424/Statewide-Study-of-the-Direct-Support-Staff?redirectedFrom=fulltext> [Accessed 25 May 2020].