Rudeness Doesn’t Motivate Workers—Quite the Opposite

Three Types of Pay Transparency Are Changing the Game

By Daniel Butcher

While there isn’t a nationwide pay-transparency law in the United States—at least not yet—10 states, several cities, and even one county (Westchester, New York) have such regulations. That means organizations may need to adjust how they communicate about pay depending on where they’re based and where they operate.

Academy of Management Scholar Peter Bamberger of Tel Aviv University said one type of transparency is letting employees freely talk about their pay with one another. That’s been protected by U.S. federal law since the passage of the National Labor Relations Act (NLRA) in 1935.

“Most employees don’t know that they have the right to talk about their pay with other employees—that’s part of the NLRA. Still, companies discourage it, and in fact, some companies go too far in discouraging it so that they’re actually breaking the law,” Bamberger said.

“There’s very little merit to stopping employee disclosure, particularly since we now have things like Glassdoor, which really make it easy for employees to find out what others are earning in return for disclosing their own compensation,” he said.

In the second type of pay transparency, employers disclose compensation ranges to current and prospective employees.

“Laws in more than a dozen U.S. states and several cities are pushing for some degree of partial transparency with mandatory employer disclosure of pay ranges,” Bamberger said.“Going beyond that, where it’s not ranges that employers show, but rather actual individual rates of pay, can be potentially risky.

“Our studies have found that letting employees see how much coworkers make tends to have some pretty detrimental effects, whether it comes to malicious envy or even counterproductive work behavior,” he said. “The comp ranges not so much, but revealing detail about how much specific individuals are making can be problematic, so you have to be very careful about how you go about doing it.

“There are some success stories that I’ve written about in a book that I wrote about pay transparency, but it can be problematic.”

The third type is procedural pay transparency, from which Bamberger and his research colleagues have found only positive outcomes.

“That is being open and transparent about every aspect of the pay system in your organization, telling employees about the basis of the compensation structure, for example, what are the criteria for increasing bonuses? How were bonuses calculated this past year? How are differential pay rates by levels in the organization determined?” Bamberger said.

“Most employees don’t have a clue as to what their benefits are or how compensation levels are determined in the organization—employee pay knowledge is really minimal,” he said.

“Where organizations enhance this procedural pay transparency, perceptions of justice and fairness increased dramatically, and that has a wide range of beneficial effects and implications on retention, social exchange and reciprocity among coworkers, and giving back to the organization.”

Why You Should Be Kind to Medical Staff

By Daniel Butcher

While many people worldwide experience frustration with their healthcare system, taking it out on individual healthcare workers can backfire. Rudeness toward medical staff can lead to more delays and even errors.

Academy of Management Scholar Peter Bamberger of Tel Aviv University said that being rude to doctors, nurses, and other medical staff can hurt their job performance because it consumes valuable cognitive resources. In short, rudeness creates a huge mental distraction.

“Our theory was that when you experience rudeness, you’re distracted because of it, and you’re not even aware that you’re distracted. But you are distracted, and as a result, you can’t pick up on a lot of the social signals that are being communicated by other people, and interactions with bosses, team members, and clients or patients are harmed by that,” Bamberger said. “We actually demonstrated that in a field experiment using medical simulations; we brought in doctors to a medical simulation center where they were working on mannequins.

“Simulation centers are increasingly used to train doctors; they have all the equipment there: They can intubate, they can see X-rays, they kind diagnose and treat maladies,” he said. “So we look at the way they interact with each other; how do they try and transmit information to each other? How do they share tasks?”

Bamberger and colleagues recorded the medical team processes while working at the medical simulation center.

“We look at their diagnostic performance, their treatment performance, and their general patient management in an intensive-care context,” Bamberger said. “First of all, what we find is that individuals who are experiencing rudeness have significantly poorer performance than those who don’t.

“It’s interesting that this rudeness experience at the start of the day has lingering effects throughout the day; it doesn’t just go away after an hour or two,” he said. “The poor diagnostic and treatment performance stays on throughout each of the scenarios that they have to deal with over the course of the day, even after lunch, so they just come in at eight in the morning, they finish at four in the afternoon, and this stuff—being distracted by bosses’ or patients’ rude behavior while they are unconsciously trying to assess any possible threat—goes on all through the afternoon.

“The differences in staff performance pre- and post-rudeness are clear.”

Mentors Influence How Much College Grads Drink

By Daniel Butcher

The quality of mentorship can be a key factor in early-career professionals surviving and thriving at an organization. And more specifically, senior executives’ alcohol use, especially while entertaining clients, has a big influence on junior employees’ drinking habits.

Academy of Management Scholar Peter Bamberger of Tel Aviv University said that for at least the three years after graduation, alcohol consumption levels typically don’t change much. But there’s a caveat.

“We do find a couple of factors that are instrumental in getting alcohol consumption to move, which gives managers some clues as to what might be done to speed up that maturing out process for junior employees and hopefully reduce the risk of managers having to deal with people with problem drinking,” Bamberger said. “This is a soft side of the socialization process when these young adults come into the organization, so some of the most instrumental factors have to do with mentoring programs, veteran employees who are there to support the newcomers.

“You have to be a little bit careful there, because we did another study in China, where we found that, for employees in sales and sales-support occupations who are social connectors, post-college alcohol consumption moves in the wrong direction,” he said. “Many young people coming into these positions within three months after graduation show patterns of hazardous drinking.

“We demonstrate that, in such cases, their ‘mentors’ are their clients who end up ‘teaching’ them how critical it is to drink in order to build trust and close the deal—now, this may be more of a sales-department client-related phenomenon, and it may be more intense in China than other parts of the world.”

In China, it’s well-known that salespeople can’t close a deal unless they show their clients a good time the night before a meeting. Such occasions often include heavy drinking. However, Bamberger notes that many companies based in many countries worldwide, including across Europe and the United States, have salespeople and clients who also have behavioral patterns like that.

“The socialization [process] is [influenced by] mentoring by certain individuals, which can be problematic,” Bamberger said. “But our study with a college students in the U.S. finds that where you have that kind of support, particularly with newcomers mentored by veterans with low or moderate levels of drinking, you can expedite the pace at which young adults mature out of this pattern of a high level of alcohol consumption.

“There are other factors and things that managers can do [to help expedite that maturation process] as well, some of them having less of an effect, including a review of alcohol-drinking policies as part of the orientation program—our findings are that that doesn’t do very much,” he said.

“Managers do need to look at what else worked to reduce problem drinking among their younger team members.”

Pay Transparency Boosts Performance, Retention of Top Performers

By Daniel Butcher

Pay transparency laws can motivate star employee stay with companies and boost their performance, while spurring poor-performing working to quit.

Academy of Management Scholar Peter Bamberger of Tel Aviv University has conducted extensive research on pay transparency, including experiments to study the implications of pay transparency and secrecy on turnover.

“We found that pay transparency generated higher retention for higher performers, but other studies done by economists found that transparency is associated with higher rates of turnover, in other words, lower retention—so we have a disconnect there,” Bamberger said.

“But there are some indications that the turnover was higher among low performers, whereas, among high performers, that transparency didn’t generate a higher rate of turnover; in those studies, transparency may not have generated higher retention, like we found, but most of the turnover that those researchers found in their field study was with lower performers,” he said.

In other words, it’s a win-win situation for leaders and managers: Greater compensation transparency does not tend to encourage high-performing (and presumably well-paid) employees to leave the organization, while it does give a nudge to low-performing (and presumably modestly paid) employees to seek employment elsewhere.

“When workers don’t know what their colleagues are making, natural biases cause many to underestimate what we call ‘instrumentality perceptions,’ the instrumental role of extra effort to achieve the right incentive benefits in driving returns,” Bamberger said. “Their motivation is lower when pay is secret, and the result is, over time, a lower growth curve in performance.

“The slope of improvement is flatter when workers don’t know how much money colleagues earn than it is when pay is transparent and they can see how they’re doing relative to others,” he said.

The main takeaway is that pay transparency boosts performance and retention of top performers while leading to turnover of poor and middling performers.

Pay Transparency May Breed Malicious Envy

By Daniel Butcher

Overall, researchers have found that pay transparency benefits organizations with fair compensation structures by incentivizing top performers to continue working hard and reducing turnover of talented contributors. But in certain situations, it can breed envy of high earners and undermine organizational culture.

Academy of Management Scholar Peter Bamberger of Tel Aviv University explained that envy can be either benign or malicious, with benign envy increasing a person’s motivation to help others, while malicious envy tends to decrease motivation. Bamberger said that in cases he studied where pay transparency bred malicious envy among colleagues, the frequency of employees helping one another decreased.

“So if I’m envious of you, and I can see that you’re having difficulties at work, will I help without you coming to me and asking for assistance? Will I come to you and say, ‘Hey, I can see you’re having some problems, here’s advice or some type of information that could help you solve some of the problems that you’re experiencing?’” Bamberger said.

“I’m less likely to do that if I’m feeling envy toward you, and I’m more likely to feel envy toward you under conditions of pay transparency,” he said.

“For people who are natural helpers, it won’t make much of a difference, but for most people, particularly among those who are more competitive or have less prosocial motivation, it can make a big difference.”

Some business leaders and managers complain that transparency is problematic, because it makes people jealous, but Bamberger and his colleagues didn’t buy that argument. Their hypothesis was that people are jealous whether pay is transparent or not, and they imagine what other people’s pay is and base their jealousy on that.

“Whether or not employees see other people’s pay, it’s still a basis for jealousy, because they believe the worst,” Bamberger said. “The difference when pay is transparent is that it’s slammed in your face, and you can’t deny it, and therefore, it’s particularly in that case where the malicious envy can be sufficiently robust to be problematic, while one of these problems was reduced unsolicited helping among coworkers.”

Transparency Helps Orgs that Pay Employees Fairly

By Daniel Butcher

Organizations with merit-based raises and bonuses deemed equitable by employees benefit from pay transparency by incentivizing top-tier performers to put in maximum effort and stay at the organization, while encouraging many bottom-tier performers to look for new jobs.

“The bottom line, what we found is that people’s perceptions of the fairness of pay in their organization had a big impact on the degree to which transparency was associated with higher or lower rates of turnover,” Academy of Management Scholar Peter Bamberger of Tel Aviv University said. “And a lot of that can be explained by people’s perceptions of trust.

“Where employees have a sense that pay is distributed fairly, you get a lot of benefits from pay transparency with regard to reduced turnover, because essentially, in most cases, where people believe that pay is fair, pay transparency is showing that the pay is, in fact, fair,” he said.

“And it’s driving higher levels of trust, which encourage people to stay in the organization, and in those situations where people are feeling that the pay is unfair, it’s typically people who are performing less well and are rewarded less well, transparency can be problematic, because then you’re actually making it obvious to them that they’re not doing as well and they’re likely to leave to look for greener pastures.”

In this way, Bamberger and colleagues were able to explain inconsistent findings regarding pay transparency and turnover in prior studies. They explained these mixed effects by showing that pay transparency can both increase and reduce turnover.

“For people who are performing well in an organization and getting those higher rewards and feel that their pay is fair, transparency drives higher retention, but for those who are feeling that their pay is unfair, perhaps because they’re getting lower rewards, typically transparency can actually drive higher rates of turnover,” he said.

Bamberger and his fellow researchers looked at employees’ overall perceptions of pay fairness, regardless of what their frame of reference was in terms of level of seniority or job title.

“What we found is when the two are aligned, high transparency with high perceptions of justice, they’re getting higher retention,” he said. “When there’s high transparency with lower perceptions of justice, we were seeing higher levels of turnover.”

Two Factors that Determine Young Professionals’ Drinking Levels

By Daniel Butcher

Early-career professionals often drink as much alcohol as they did in college or even more after graduation, especially if they’re working in a sales role with a boss or mentor who drinks a lot, research shows. But young workers in roles that make them feel empowered and who are surrounded by supportive coworkers who tend to drink alcohol in moderation are more likely to deal with socialization and stress in healthy ways and avoid problem drinking.

That’s according to Academy of Management Scholar Peter Bamberger of Tel Aviv University, who said supportive peer relationships with abstainers or moderate drinkers can be influential, as can jobs that provide a higher level of psychological empowerment.

“A combination of the two—peer support and empowerment—make it so that people aren’t as stressed out by being given roles and tasks that they may not be able to handle, because underlying a lot of what’s involved with this drinking are two main motivations,” Bamberger said. “One is a normative social motivation to go out and drink to become socially integrated in their workplace.

“The second is a stress motivation: ‘This is how I coped with stress in college; I went out to drink, and now I do the same thing at work,’” he said. “One of the critical things that we show in our research studies is that if managers can find alternative ways of coping with stress, actually being proactive in terms of trying to address some of the stressors that newcomers face at work, like uncertainty, they may be able to speed up that maturing out process that can lead to reduced levels of alcohol consumption among early-career professionals.

“Support from peers and psychological empowerment were keys to success in that.”

Binge Drinking Decreases After College, Right? Not So Fast…

By Daniel Butcher

Contrary to popular belief, university students don’t get drinking out of their systems during their college years before entering the workforce. Studies show drinking levels increase after graduation and peak in the mid-20s.

Academy of Management Scholar Peter Bamberger of Tel Aviv University said that especially for some client-facing roles such as sales, on-the-job pressures and social situations often lead to increased alcohol consumption among young professionals.

“The common perception is that people’s drinking is at its highest levels for young adults, at least when they’re in college, and then as soon as they get out of college, they take on employment; they start their career, and their drinking very quickly declines,” Bamberger said. “However, there’s been some indication already for the past 10 years that that may not be the case.

“In fact, the data on young adults shows that, particularly among college students and twenty-somethings, the peak levels of alcohol use and misuse are actually at around ages 25 and 26, and they’re continuously rising after graduation,” he said. “It’s not like people graduate from college and mature out of their drinking—the party continues.”

Bamberger and colleagues have studied different profiles of alcohol drinkers. Their research findings don’t always align with popular narratives about booze consumption.

“We’ve looked at how people drink alcoholic beverages, how frequently and when they drink, and there are certain patterns that are more problematic than others,” Bamberger said. “First of all, where individuals engage in heavy episodic drinking, like binge drinking, and they do it more frequently, and they do it not necessarily only on a weekend but during the week as well, that’s a very risky pattern.

“And then you have more in the middle of the range, moderate traits and patterns, and then you have patterns like only drinking socially or only on special occasions, and you have abstainers, but and most college students do drink—most are not abstainers,” he said.

“We have these three patterns among people who drink, and when we look at the likelihood of people shifting from a really risky pattern of heavy drinking to a more moderate pattern, or from a moderate pattern to light drinking, what we find is that these patterns are in fact rather sticky.”

Sharing Info, Workloads, Positive Feeback Boosts Productivity

By Daniel Butcher

Leaders who can install processes for effective, timely information-sharing, fair workload distribution, and civil communication—including positive feedback—foster the best collaboration and productivity among team members.

Academy of Management Scholar Peter Bamberger of Tel Aviv University said that lackluster productivity is often a result of poor information-sharing and workload-sharing behaviors.

“Team processes are hard; people can’t always pick up the signals that they need to,” Bamberger said. “For example, if they have a piece of information that someone else needs, when should they pass it on to this other person? A nurse has a test result; when should she pass it on to the to the team leader or attending physician?

“If she passes it on too early, she’s going to disrupt what they’re doing, which clearly affects their performance, but if she passes it on too late, it could be deadly, so timing and synchrony of such tasks are crucial,” he said.

Incivility and rudeness also undermine productivity, while civility and kindness tend to boost it.

“In research on medical teams, we demonstrated that when people experience gratitude at work it can often, but not always, have beneficial implications,” Bamberger said. “A lot depends on the source of the gratitude and the nature of the task at hand.

“In one experiment, we had the three teams: a control condition, one that viewed a video before they started the day from a senior neonatologist talking about how grateful he is to everybody in the field for doing the wonderful work they do to save these babies, which had nothing in terms of a productivity boost, but then we had a third group where we had a mother of a preemie talk about how grateful she was to the medical team that saved her child, and that had massive positive effects,” he said.

“We demonstrate what that does to the team interaction through the implications based on a theory in cognitive science called [Fredrickson’s]broaden-and-build, which explains how positive emotions have beneficial effects on people’s ability to be flexible in their thinking, to absorb more information, and things like that.”

Bamberger and colleagues also demonstrate that the effects were much stronger when a mother expressed gratitude than when a senior colleague did.

Sharing positive customer feedback

Business leaders and managers can leverage these insights to improve their effectiveness.

“They can demonstrate gratitude themselves; it does make intuitive sense that if managers and leaders behave with civility and politeness, then that may set an example for the rank-and-file employees to do the same, but they can encourage customers and clients or patients to say ‘thank you’ directly,” Bamberger said. “If you like the way a flight attendant treated you on a flight, you’re supposed to write the company, but what if you were actually put in direct contact with the flight attendant and were able to express the gratitude directly?

“Our evidence suggests that that’s going to have a much stronger effect than a manager saying, ‘You got three positive letters this week,’” he said. “Setting up systems for customers to directly express positive feedback has the potential to significantly boost employee morale and performance.”

Why Retirees Change Their Alcohol Consumption

By Daniel Butcher

Whether people increase or decrease the amount of alcohol they drink after retirement depends on a range of factors, including what role and industry they retire from.

Academy of Management Scholar Peter Bamberger of Tel Aviv University said that he and colleagues studied the implications of general work-related transitions on health and well-being, with a particular focus on subjects’ behavior with regard to drinking alcohol, before and after retirement.

“We actually started with people as they move towards retirement, and we did a 10-year study,” Bamberger said. “The research was finding mixed effects of retirement on alcohol consumption; some studies found that retirement is a great way to address your drinking problems, because you’re often removing people from a high-risk environment where people around them drink a lot.

“But other studies were finding that people go into retirement and move into a retirement community and happy hour starts at noon,” he said.

Bamberger’s and colleagues’ question was, ‘Is retirement good or bad with regard to alcohol consumption or misuse?’ They were looking at various factors that determine when a person’s level of drinking goes in one direction and when it goes in the other direction.

“A simple finding is, if you’re coming out of a high-risk occupation, for example, iron workers, people who build skyscrapers—this is an occupation that has its roots with very heavy drinking communities, so if you joined that occupation, at least in the past, you were likely to adopt those patterns, or you wouldn’t stay in the occupation,” Bamberger said. “So retiring from that is obviously going to be beneficial, because you’re taking yourself out of a social context of high alcohol consumption.”

But there are other variables to consider, including relationships with friends, family, and spouses. A best practice for retirees is keeping busy with hobbies, volunteerism, or even some part-time work, any activity aimed at staying engaged and connected and ensuring a continuing sense of self-worth and contribution.

“We looked at some of the factors that are associated with retirement, like financial stress and marital strain, with one member of a couple working the other one not, and we can find implications there as well for drinking,” Bamberger said. “The routine is disrupted; there’s more free time for one partner in the relationship but not the other.

“There’s a vast array of moderating and conditioning factors that determine when retirement has one implication—more drinking—versus another—less drinking,” he said. “Retirees who plan how to structure their time post-separation from work tend to have better health outcomes.

“Overall, work-related transitions can be difficult for people, and our current research has aimed at exploring the mental-health implications of other such transitions, including for students and soldiers transitioning into career employment for the first time.”