FOUNDATION OF COMPUTER SCIENCE Study Guide - Equity Theory, Abraham Maslow, Employee Engagement

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In the equity theory of motivation, employee"s motivation depends on their perception of how fair is the compensation and treatment for their work input. Theory states that the employees perceive what they get from a job situation. The equity theory of motivation describes the relationship between the employee"s perception of how fairly is he being treated and how hard he is motivated to work. If the person perceives the rewards as equitable, he/she probably will continue at the same level of output. If the person feels that he/she is inequitably rewarded, he/she may be dissatisfied, reduce the quantity or quality of output, or even leave the organization. The three situations of equity theory are illustrated in the following figure: An employee with several years" experience can be frustrated to find out that a recent college grad hired at a salary level higher than he or she is current earnings, causing motivation levels to drop.

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