Psychopathy consists of affective-interpersonal traits, such as callousness, emotional detachment, limited empathy, and constrained remorse. These traits influence how leaders perceive and treat others. In organizational settings, psychopathic tendencies may weaken leaders’ concern for fairness and undermine their capacity to recognize, question, or correct inequities. Building on this logic, we theorize that CEOs with high levels of psychopathic traits exacerbate the within-firm gender pay gap by allowing gendered disadvantage to accumulate over time through pay-setting and career decisions. We test this logic with a comprehensive Finnish panel dataset linking psychometric psychopathy scores of male CEOs with matched employer-employee data and further data sources. Consistent with our theorizing, we find that the pay difference between male and female employees is larger under CEOs with higher (as compared to lower) levels of psychopathic traits. Moreover, the gender pay gap is amplified in traditional gender-job role climates, and in male-dominated jobs, where gendered expectations and prejudice against women are more salient. Together, these findings advance research on upper echelons and workplace inequality by demonstrating how executive personality traits interact with structural biases within organizations and societal norms surrounding them.
Pay information disclosure (PID), the communication of relevant pay information between and among actors, is increasingly important, as evidenced by numerous countries enacting PID legislation. Such legislation aims to reduce the gender pay gap by helping women evaluate and renegotiate their pay. Despite these benefits, companies are hesitant to disclose pay information. This study leverages a PID law passed by the German parliament in 2017 that entitles employees to request pay-related information from employers. This law, unlike stricter regulations in other countries, provides a unique opportunity to examine organizational PID actions under relatively lenient requirements. Our research addresses three questions: How do employers respond to increasing public demand for PID? How do employees react to employers withholding pay information? Do men and women respond differently to their employers' PID decisions? By exploring these questions, we provide insights into organizational transparency and gender pay equity. Our study extends PID research by conceptualizing PID as a management practice, examining employee reactions in a less regulated context, and exploring gender differences in PID responses. Specifically, we find that employer inaction in response to the PID law negatively affected employees' organizational citizenship behaviors. In addition, it increased women's (but not men's) turnover intentions and communication about their pay, and decreased women's (but not men's) pay satisfaction. Our findings have meaningful implications for practitioners and policymakers.
Work from home (WFH) is recognized as carrying both risks and benefits for individuals. However, its impact on romantic couples remains poorly understood. Drawing on boundary theory and family systems theory, we propose that WFH can render certain couples vulnerable to separation and trace the process through which this occurs. Specifically, when romantic partners hold incongruent preferences for segmenting work and home, or when both have a high preference for segmentation, WFH employees might experience heightened work-to-home conflict. This conflict drains resources needed for intimacy, fostering mutual loneliness and, ultimately, relationship dissolution deliberations. Across two longitudinal studies of dual-earner couples in Germany (n = 170, n = 1561), we found nuanced support for this model. Dyadic response surface analyses showed that incongruent segmentation preferences affected the work-to-home conflict of employees in divergent ways-exacerbating it for some, mitigating it for others. As expected, a joint preference for segmentation was consistently associated with heightened work-to-home conflict in WFH employees. Work-to-home conflict was linked to loneliness in both partners, which explained dissolution deliberations. Overall, our research highlights that WFH is a work arrangement that has couple-level consequences-beneficial for some, but a risk factor for others.
This paper reviews the transformative role of Generative Artificial Intelligence (GenAI) in Human Resource (HR) management, from a practice perspective, highlighting both opportunities and challenges and laying out a use-inspired future research agenda. This scoping review is grounded in insights from a unique Summit held in Spring 2024, which brought together HR academic scholars with dozens of Fortune 500 Chief Human Resource Officers (CHROs) and their top technical leaders to discuss the workforce implications of GenAI. The paper identifies six key themes from the Summit practitioners: GenAI as disruptive and transformative, data as competitive advantage, adoption challenges, potential ethical abuses, the experimentation imperative, and the critical role of CHROs. These six themes provide a foundation for future research directions, which are discussed regarding six functional HR areas: recruitment and selection, training and development, performance management, job and work design, talent management, and compensation and benefits. The research agenda in each area emphasizes the need for academic researchers to understand and address the practical challenges posed by GenAI. Overcoming these substantive challenges will demand meaningful effort and a keen willingness to learn, on the part of both HR leaders and scholars. The paper concludes with a call to action for management scholars to engage in use-inspired research that bridges the gap between academic knowledge and practical HR challenges.
How does the complexity of executive compensation contracts affect firm performance? With unknown consequences, the compensation complexity of executives has been rising. We define and measure executive compensation complexity and relate it to accounting; market; and environmental, social, and governance metrics of firm performance. Chief executive officer (CEO) compensation complexity negatively affects all three types of firm performance. We explore theoretical explanations for this relationship and find that cognitively complex CEOs can better deal with complex contracts. The negative complexity effects disappear if firms use only financial goals. Complexity is more harmful in unstable and munificent industries. Complexity also mitigates the negative effect of CEO tenure on long-term performance. In addition, firm performance suffers if the top management team members have heterogeneously complex contracts. Robustness checks support these findings. We conclude that the trend of adding more metrics to executive compensation contracts is not a generally preferable solution to the new and more intense agency problems that firms encounter.
Executives care about their pay compared to their peers, e.g. their top management team colleagues. Dispersion in pay is associated with negative effects for both performance and turnover. While existing researched has focused on dispersion in pay levels and thus distributive fairness concerns, the differences in pay contract design have largely been overlooked. Building on procedural fairness we investigate how differences within the pay design – namely the share of pay for performance relative to a fixed salary, the number of performance grants, and the number of performance goals – influence individual executive turnover. Our results suggest that disparities in design lead to more executive turnover, especially for those with more pay at risk and fewer goals relative to their peers. We discuss implications for research and practice.
Pay information disclosure (PID), or communicating pay information between and among actors, affects employees, organizations, and societies. Disruptions resulting from artificial intelligence (AI) will also change how pay is communicated. Based on AI, AI and human resources (HR), and PID, as well as anecdotal data involving organizations that are integrating AI in their pay practices, we introduce areas of AI relevant to PID and describe opportunities and challenges. HR should play a critical role in developing employee trust in AI systems by protecting employee privacy, training AI on high-quality data, and ensuring AI algorithms are ethical. AI can transform PID by supporting advanced pay methodologies, reducing barriers to sharing information, and educating employees. However, research needs to be conducted on all of these areas and practitioners should strive to keep an open, but cautious mind about both the benefits and challenges of integrating AI into HR practices.
Why do employees experience work from home (WFH) differently? We draw on boundary theory to explain how WFH influences employees' work-home interface. WFH intensity increases negative spillovers (i.e., work-to-home conflict and home-to-work conflict) and positive spillovers (i.e., work-to-home enrichment and home-to-work enrichment) between the work and home domains. Negative spillovers can be mitigated through high-quality work equipment and beneficial spatial conditions at home. Domain centrality predicts who can benefit from increased WFH intensity. We test our theory with a sample of 545 employees, obtained through a two-step random sampling procedure in the city of Munich/Germany during the COVID-19 pandemic. We find that WFH intensity increases work-to-home conflict and home-to-work enrichment, affecting employees' relationship satisfaction and job satisfaction. High-quality work equipment mitigates the detrimental effects of WFH. Employees with a high family centrality can reap benefits of more WFH because they experience more home-to-work enrichment. The simultaneous desirable and detrimental effects of WFH intensity can partly explain why studies have found heterogenous WFH experiences among employees.
The amount and type of pay information made available by organizations to employees and between employees can have important effects on employee attitudes and behaviors as well as organizational performance. Although a large body of research on pay information exists, on topics ranging from pay transparency to pay secrecy, researchers have used inconsistent definitions (pay secrecy, openness, transparency, pay communications) and operationalizations that hinder knowledge development. In this paper, consistent with the theory of information asymmetry and based on research reviewed here, we promote a new integrative definition (“pay information disclosure”) that anchors both current and future research. We define the concept of pay information disclosure (PID) as the communication of relevant pay information between and among actors. By viewing pay information disclosure research in an information asymmetry context, with its focus on the causes and consequences of unequal access to information, we can synthesize research that examines motives for and outcomes of PID for individuals, organizations, and society. Based on our review, we outline a research agenda that identifies research questions and methods to stimulate studies to better understand the role of pay information in the workplace and in society.
Compensation benchmarking has become a common practice for determining executive compensation in companies. The key motive for compensation benchmarking is to identify an appropriate way of compensating executives, with the primary goal of human capital retention. In this study, we argue that compensation benchmarking leads to convergence in executive compensation by directing attention and informational cues following two mechanisms: a) direct peer influence through the selection of compensation peers, and b) indirect peer influence through exposure to the same compensation peers. Using an extensive panel of executive compensation data of publicly traded U.S. companies we show that compensation benchmarking leads to convergence in executive compensation levels and mix and in turn reduces the likelihood of executive mobility to peer companies. We discuss theoretical and practical implications.
How does the complexity in CEO compensation affect firm performance? With unknown consequences, the complexity of executive compensation contracts is rising. In this study, we explore how the complexity of executive compensation relates to ?rm performance. We conceptualize and operationalize the objective constituents of complex compensation contracts and find negative outcomes on both accounting- and marked-based measures of firm performance for CEOs. Based on these findings, we furthermore offer and explore theoretical explanations for the relationship, namely multitasking and cognitive limitations. We link these findings to the top management team (TMT) and suggest that compensation complexity is an important extension for the TMT pay dispersion and behavioral integration literature. We discuss these findings and close with potential research opportunities in the nascent research field of compensation complexity.
Using data from a retail chain of 193 bakery shops that underwent downsizing, we study the effects of two types of downsizing announcements – closure or sale to another operator – on sales in the affected shops, and how these effects are moderated by job security perceptions. On average, sales in the affected shops go down by 26% after a closure announcement and by 7% after a sale announcement. Sales decline more sharply in shops where employees had higher job security perceptions before the announcement. Our findings are consistent with psychological contract theory: a breach of an implicit contract promising job security in exchange for work effort results in a reciprocal effort withdrawal. We rule out several alternative explanations to our findings.
The authors review the German voluntary turnover literature and examine how it reflects and extends the overall knowledge of employee turnover. First, the authors describe legal, institutional, and cultural influences specific to Germany that may affect voluntary turnover and its relationships with antecedents and outcomes. The authors then explain how research paradigms, which in German turnover research are primarily embedded in sociology and labor economics and to a lesser degree psychology and management, affect the lens by which voluntary turnover is examined. For instance, the variety of research perspectives leads to a variety of research questions, theories, data, and methodological approaches. Using these diverse perspectives, the authors explain how measurement and data quality concerns may hamper the understanding of turnover in cross-country/cross-cultural comparisons. This review further reveals many similarities with US-based turnover research, regarding the theories, methods, and results. The authors also find that turnover levels are, on average, considerably lower in Germany than in Anglo-Saxon labor markets. The authors suggest that the industry structure in Germany, coined by its strong and traditionally organized “Mittelstand” companies, may partly drive these findings. The authors close by identifying several research opportunities, available through advances in technology to improve the matching process, nonstandard work arrangements (such as in the gig economy), and a broader perspective on institutional peculiarities.
Pay transparency regulations aim at reducing economic inequalities such as pay discrimination and the gender pay gap. However, such regulations do not necessarily lead to more transparency and less discrimination. We add to pay transparency scholarship by studying the employer—employee interactions that unfold in the course of the implementation of a new pay transparency law. More specifically, we explore the quasi-causal effects of the "Transparency in Wage Structures Act" (TWSA) in Germany through a comprehensive survey data analysis. We show that – in spite of the law – plants remain passive, and hardly contribute to more pay transparency. We also show that employees in TWSA plants communicate more about their pay, such that the TWSA increases pay transparency through a bottom-up, informal process rather than through mandated plant-based transparency. At the same time, employees report a decrease in pay satisfaction and organizational citizenship behaviors. We discuss these results, and outline theoretical and practical implications.
The context, meaning, and mechanisms for changing jobs varies around the world (e.g. benefit systems that make firing employees so costly that managers try to drive employees to quit in France; hukou in China where state benefits are tied to the location where one is born), and most employees do not work for firms that are U.S.-owned or based. However, the bulk of the theory and research adopts a U.S.-centric perspective. The purpose of this panel symposium is for scholars embedded in contexts around the world to describe the relevance and implications (or lack thereof) of turnover theories in their particular context.