Low salaries do not usually "make for a demoralizing situation" in my long
experience -- unless they become so low as to raise the specter of
inequity. When people are being paid significantly less than others doing
an equivalent job, then equity issue do arise and these can cause
performance and morale problems.
In every company I've ever consulted with (and I've worked with about 25%
of the Fortune 1000 plus a handful of smaller firms), people complain
about salary. But in every case that did not include real inequity this
was a smokescreen for other complaints that were much more important. The
trouble is, at least in the cultures in which I've had experience, we
believe we have "permission" in the culture to say, "My pay is too low"
but we don't have permission in organizations to say things like, "You
don't love me enough."
If I may be allowed to make a second point. Pay for performance scarcely
exists (let alone has any effect) in any organization of which I'm aware.
The two exceptions: straight commission salespeople and executives who
receive more bonus pay than salary.
I have come to believe that "pay for performance" is a chimera not worth
chasing. On the other hand, reward for performance (true
performance-contingent recognition, privileges, opportunities to
contribute or "make a difference," tokens, respect, etc.) is one of the
system changes most worth implementing. Since money is, by far, NOT the
most important reward sought by human beings at work [plenty of evidence
for this, including psychological research studies and work based on
Maslow's pyramid, etc.] -- doesn't it just make sense to institute
non-monetary-based contingent reward systems? In my long experience it
certainly pays off to everyone concerned.
--"John Gunkler" <jgunkler@sprintmail.com>
Learning-org -- Hosted by Rick Karash <rkarash@karash.com> Public Dialog on Learning Organizations -- <http://www.learning-org.com>