Hostname: page-component-74656f9884-j7cmm Total loading time: 0 Render date: 2026-11-10T05:18:18.242Z Has data issue: false hasContentIssue false
  • English
  • Français

Compensation Ethics and Organizational Commitment

Published online by Cambridge University Press:  23 January 2015

Jeffrey Moriarty
Jeffrey Moriarty*
Affiliation:
Bentley University
Rights & Permissions [Opens in a new window]

Abstract:

Core share and HTML view are not available for this content. However, as you have access to this content, a full PDF is available via the 'Save PDF' action button.

If an employee is committed to his firm—if he is “attached” or “bound” to it—then his firm may be able to obtain a discount on his labor. This paper asks: Is it wrong for firms to do so? If we understand just or fair pay solely in terms of voluntary agreements between employers and employees, the answer seems to be ‘no.’ Against this, I argue that, in some cases, it is ‘yes.’ In particular, it is wrong for firms to try to obtain discounts on their committed employees’ labor when their employees reasonably expect that they will not try to obtain them. In the process, I probe the limits of exploitation and question the relevance of contribution to fairness in compensation.

Keywords

commitmentcompensationethicsexpectationsexploitation

Information

Type
Articles
Information
Business Ethics Quarterly , Volume 24 , Issue 1 , January 2014 , pp. 31 - 53
Copyright
Copyright © Society for Business Ethics 2014

References

REFERENCES

Alchian, A.A., & Demsetz, H. 1972. Production, information costs, and economic organization. American Economic Review, 62(5): 777–95.Google Scholar
Anabtawi, I. 2005. Explaining pay without performance: The tournament alternative. Emory Law Journal, 54(4): 1557–1602.Google Scholar
Arnold, D.G. 2003. Exploitation and the sweatshop quandary. Business Ethics Quarterly, 13(2): 243–56 http://dx.doi.org/10.5840/beq200313216.CrossRefGoogle Scholar
Baier, A.C. 1995. Moral prejudices: Essays on ethics. Cambridge, MA: Harvard University Press.Google Scholar
Bebchuk, L.A., & Fried, J.M. 2004. Pay without performance: The unfulfilled promise of executive compensation. Cambridge, MA: Harvard University Press.Google Scholar
Benn, S.I. 1988. A theory of freedom. New York: Cambridge University Press. http://dx.doi.org/10.1017/CBO9780511609114CrossRefGoogle Scholar
Bloom, M. 1999. The performance effects of pay dispersion on individuals and organizations. Academy of Management Journal, 42(1): 25–40http://dx.doi.org/10.2307/256872.CrossRefGoogle Scholar
Boatright, J.R. 2010. Executive compensation: Unjust or just right? In Brenkert, G. & Beauchamp, T.L. (Eds.), Oxford handbook of business ethics (pp. 161–201) New York: Oxford University Press.CrossRefGoogle Scholar
Brand-Ballard, J. 2010. Limits of legality: The ethics of lawless judging. New York: Oxford University Press.CrossRefGoogle Scholar
Buchanan, A.E. 1985. Ethics, efficiency, and the market. Totowa, NJ: Rowman & Allanheld.Google Scholar
Carson, T.L. 2010. Lying and deception: Theory and practice. New York: Oxford University Press. http://dx.doi.org/10.1093/acprof:oso/9780199577415.001.0001CrossRefGoogle Scholar
Cowherd, D.M., & Levine, D.I. 1992. Product quality and pay equity between lower-level employees and top management: An investigation of distributive justice theory. Administrative Science Quarterly, 37(2): 302–20. http://dx.doi.org/10.2307/2393226.CrossRefGoogle Scholar
Davis, J.H., Schoorman, F.D., & Donaldson, L. 1997. Toward a stewardship theory of management. Academy of Management Review, 22(1): 20–47.CrossRefGoogle Scholar
de Roover, R. 1958. The concept of the just price: Theory and economic policy. Journal of Economic History, 18(4): 418–34.CrossRefGoogle Scholar
Frank, R.H. 1984. Are workers paid their marginal products? American Economic Review, 74(4): 549–71.Google Scholar
Frank, R.H. 1988. Passions within reason: The strategic role of the emotions. New York: Norton.Google Scholar
Freeman, S. 2011. Capitalism in the classical and high liberal traditions. Social Philosophy and Policy, 28(2): 19–55. http://dx.doi.org/10.1017/S0265052510000208.CrossRefGoogle Scholar
Friedman, M. 2002/1962. Capitalism and freedom. Chicago: University of Chicago Press. http://dx.doi.org/10.7208/chicago/9780226264189.001.0001CrossRefGoogle Scholar
Gabaix, X., & Landier, A. 2008. Why has CEO pay increased so much? Quarterly Journal of Economics, 123(1): 49–100. http://dx.doi.org/10.1162/qjec.2008.123.1.49.CrossRefGoogle Scholar
Gauthier, D.P. 1986. Morals by agreement. New York: Oxford University Press.Google Scholar
Gerhart, B., & Rynes, S.L. 2003. Compensation: Theory, evidence, and strategic implications. Thousand Oaks, CA: Sage.CrossRefGoogle Scholar
Goodin, R.E. 1988. Reasons for welfare: The political theory of the welfare state. Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Habib, A. 2008. Promises. In Zalta, E.N. (Ed.), The Stanford encyclopedia of philosophy (Winter 2008 Edition). http://plato.stanford.edu/archives/win2008/entries/promises/.Google Scholar
Heath, J. 2007. An adversarial ethic for business: Or, when Sun-Tzu met the stakeholder. Journal of Business Ethics, 72(4): 359–74. http://dx.doi.org/10.1007/s10551-006-9175-5.CrossRefGoogle Scholar
Hellman, D. 2011. When is discrimination wrong? Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Jensen, M.C., & Meckling, W.H. 1976. Theory of the firm: Managerial behavior, agency costs, and ownership structure. Journal of Financial Economics, 3(4): 305–60. http://dx.doi.org/10.1016/0304-405X(76)90026-X.CrossRefGoogle Scholar
Koehn, D., & Wilbratte, B. 2012. A defense of the Thomistic concept of the just price. Business Ethics Quarterly, 22(3): 501–26. http://dx.doi.org/10.5840/beq201222332CrossRefGoogle Scholar
Lazear, E.P., & Rosen, S. 1981. Rank-order tournaments as optimum labor contracts. The Journal of Political Economy, 89(5): 841–64. http://dx.doi.org/10.1086/261010CrossRefGoogle Scholar
Lippert-Rasmussen, K. 2006. The badness of discrimination. Ethical Theory and Moral Practice, 9(2): 167–85. http://dx.doi.org/10.1007/s10677-006-9014-xCrossRefGoogle Scholar
Lipsey, R.G., & Chrystal, K.A. 2007. Economics. Oxford: Oxford University Press.Google Scholar
Machan, T.R., & Chesher, J. 2002. A primer on business ethics. Lanham, MD: Rowman & Littlefield.Google Scholar
Marx, K. 1986. Karl Marx: A reader, ed. Elster, J.New York: Cambridge University Press.Google Scholar
Mason, E. 2005. We make no promises. Philosophical Studies, 123(1–2): 33–46. http://dx.doi.org/10.1007/s11098-004-5219-9CrossRefGoogle Scholar
Mathieu, J.E., & Zajac, D.M. 1990. A review and meta-analysis of the antecedents, correlates, and consequences of organizational commitment. Psychological Bulletin, 108(2): 171–94. http://dx.doi.org/10.1037/0033-2909.108.2.171CrossRefGoogle Scholar
Mayer, R. 2007. What’s wrong with exploitation?. Journal of Applied Philosophy, 24(2): 137–50. http://dx.doi.org/10.1111/j.1468-5930.2007.00360.xCrossRefGoogle Scholar
Meyer, J.P., & Allen, N.J. 1991. A three-component conceptualization of organizational commitment. Human Resource Management Review, 1(1): 61–89. http://dx.doi.org/10.1016/1053-4822(91)90011-ZCrossRefGoogle Scholar
Meyer, J.P., & Allen, N.J. 1997. Commitment in the workplace: Theory, research, and application. Thousand Oaks, CA: Sage.CrossRefGoogle Scholar
Milkovich, G.T., & Newman, J.M. 2008. Compensation (9th ed.). Boston: McGraw-Hill/Irwin.Google Scholar
Miller, D. 1999. Principles of social justice. Cambridge, MA: Harvard University Press.Google Scholar
Moriarty, J. 2011. Does distributive justice pay? Sternberg’s compensation ethics. International Journal of Applied Philosophy, 25(1): 33–48. http://dx.doi.org/10.5840/ijap20112514CrossRefGoogle Scholar
Munzer, S.R. 1990. A theory of property. New York: Cambridge University Press. http://dx.doi.org/10.1017/CBO9780511609138CrossRefGoogle Scholar
Narveson, J. 1971. Promising, expecting, and utility. Canadian Journal of Philosophy, 1(2): 207–33.CrossRefGoogle Scholar
Nelson, R.M., Beauchamp, T., Miller, V.A., Reynolds, W., Ittenbach, R.F., & Luce, M.F. 2011. The concept of voluntary consent. American Journal of Bioethics, 11(8): 6–16. http://dx.doi.org/10.1080/15265161.2011.583318CrossRefGoogle ScholarPubMed
Nozick, R. 1974. Anarchy, state, and utopia. New York: Basic Books.Google Scholar
Olsaretti, S. 2004. Liberty, desert and the market. Cambridge: Cambridge University Press. http://dx.doi.org/10.1017/CBO9780511487422CrossRefGoogle Scholar
O’Reilly, C.A., & Chatman, J. 1986. Organizational commitment and psychological attachment: The effects of compliance, identification, and internalization on prosocial behavior. Journal of Applied Psychology, 71(3): 402–99. http://dx.doi.org/10.1037/0021-9010.71.3.492Google Scholar
Pfeffer, J., & Langton, N. 1993. The effect of wage dispersion on satisfaction, productivity, and working collaboratively: Evidence from college and university faculty. Adminstrative Science Quarterly, 38(3): 382–407. http://dx.doi.org/10.2307/2393373CrossRefGoogle Scholar
Rose, D.C. 2002. Marginal productivity and analysis in teams. Journal of Economic Behavior & Organization, 48(4): 355–63. http://dx.doi.org/10.1016/S0167-2681(01)00239-6CrossRefGoogle Scholar
Sample, R.J. 2003. Exploitation: What it is and why it’s wrong. Lanham, MD: Rowman & Littlefield.Google Scholar
Scanlon, T.M. 1998. What we owe to each other. Cambridge, MA: Harvard University Press.Google Scholar
Sen, A. 1992. Inequality reexamined. Cambridge, MA: Harvard University Press.Google Scholar
Sidgwick, H. 1981/1907. The methods of ethics. Indianapolis: Hackett.Google Scholar
Soule, E. 1998. Trust and managerial responsiblity. Business Ethics Quarterly, 8(2): 249–72. http://dx.doi.org/10.2307/3857328CrossRefGoogle Scholar
Sternberg, E. 2000/1907. Just business: Business ethics in action (2nd ed.). New York: Oxford University Press.Google Scholar
Valdman, M. 2009. A theory of wrongful exploitation. The Philosophers’ Imprint, 9(6): 1–14.Google Scholar
Wasserman, N. 2006. Stewards, agents, and the founder discount: Executive compensation in new ventures. Academy of Management Journal, 49(5): 960–76. http://dx.doi.org/10.5465/AMJ.2006.22798177CrossRefGoogle Scholar
Wertheimer, A. 1996. Exploitation. Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Wertheimer, A. 2008. Exploitation. In Zalta, E.N. (Ed.), The Stanford encyclopedia of philosophy (Fall 2008 Edition). http://plato.stanford.edu/archives/fall2008/entries/exploitation/.Google Scholar
Wood, A.W. 1995. Exploitation. Social Philosophy and Policy, 12(2): 136–58. http://dx.doi.org/10.1017/S0265052500004702CrossRefGoogle Scholar
Zwolinski, M. 2007. Sweatshops, choice, and exploitation. Business Ethics Quarterly, 17(4): 689–727. http://dx.doi.org/10.5840/beq20071745CrossRefGoogle Scholar