To succeed, an organization needs more than competent employees, it needs employees who enhance each others' efforts, who engage in "citizenship behaviors." The primary way to encourage such behaviors is through a reward system. But should the system reflect equity by rewarding individuals for behavior that furthers organizational goals, or should it reflect equality by distributing rewards equally among members of a group? And do men and women react differently to these two types of reward systems? To find answers, a study of 467 employees in Ireland tested five hypotheses. The equity model generated the most positive results, but, somewhat surprisingly, the equality model did not discourage citizenship behaviors. The effects of gender were mixed.
During the past two decades, organizational citizenship behaviors have been a subject of increasing interest in the management and organizational behavior literature (e.g., Podsakoff, Whiting, Podsakoff, and Blume, 2009). For an organization to succeed, employees must engage in positive behaviors that benefit other employees as well as themselves. Such behaviors, called organizational citizenship behaviors, may extend beyond job duties, roles, and responsibilities. In the era of globalization with a prevalence of multi-cultural and virtual teams in organizations, collaboration and cooperation need to be emphasized. A critical issue facing organizations is how to evoke such citizenship behaviors. One strategy suggested to promote positive citizenship behaviors has been to design reward systems that encourage cooperation as opposed to competition. The literature on compensation and reward systems (e.g., Baron and Kreps, 1999; Cox, 1993; Milkovich, Newman, and Gerhart, 2010) has suggested that reward system characteristics influence employee behaviors, performance, tendencies to help others, and ethical judgment (e.g., Selvarajan and Cloninger, 2009).
Yet, researchers differ in fundamental ways regarding how reward systems should be designed. The agency theory (Jensen and Meckling, 1976) suggests that reward systems must align individual behaviors with organizational goals by creating incentives for behaviors that are likely to benefit the organization and further its goals. This economic model is also consistent with equity theory (Adams, 1965), which states that the relationship between an individual's effort and reward must be proportional. In the compensation literature, the notion of pay for performance is based on the principle of equity suggested by Adams (1965). Evidence suggests that the perception that an organization rewards desirable behaviors or punishes undesirable behavior is one of the factors that influence employee behavior (Ashkanasy, Windsor, and Trevino, 2006). Further, if employees perceive a lack of equity in rewards, they may lower their level of job performance or leave the organization.
In contrast, another stream of research suggests that rewards based on individual performance (e.g., Baron and Kreps, 1999; Cox, 1993) will tend to promote competition rather than cooperation among employees. From this perspective, rewarding individual performance may actually result in employees not engaging in positive citizenship behaviors, since helping others perform better may hinder an employer's own potential rewards or career growth (Bergensen, 2007). An alternative form of distributive justice relies on the notion of equality or distribution of rewards equally among the group members based on group or departmental performance. When employees are rewarded based on the group performance, they are more likely to engage in cooperative behaviors that benefit the larger group.
While economic approaches rely on incentives to promote desirable behaviors, an alternative approach based on gender socialization (Gilligan, 1982) and social role theory (Eagly, 1987) suggests that women are inherently more …