The 4 Rules of Treating Employees Equitably
If you want to be a respected boss, a revered manager and a followed leader, you need to understand the four tenets of workplace equity.
As humans, we want to be treated equitably. We want to know that we're valued, that our work matters, and that we are compensated fairly for our efforts. The concept of equity involves looking at a situation and identifying the variables -- the people involved, the resources at play and the situational factors -- and then asking yourself these questions:
- Are we giving each person the necessary resources?
- Are we giving each person a proportional amount of attention?
- Are we showing appreciation in a balanced way?
- Are we giving each person an equal opportunity to succeed?
If you want to be a respected boss, a revered manager, and a followed leader, you need to understand the four tenets of workplace equity. Once you do, you'll know better how to communicate dynamically to get to the root of the problem, manage the situation and ensure a fair solution.
Tenet one: people exchange work for rewards
People work for rewards. Plain and simple. I don't know anybody who goes to a job and doesn't expect to get anything in return. Many managers assume that the salary, hourly wage or contract rate for coming to work is enough. But they're wrong. In fact, the number-one reason people quit their job is bad bosses, not bad wages.
Your employees need to feel they're being compensated fairly for the value they're providing. In a managerial capacity, you need to know what makes your employees tick. This compensation is not just monetary. Increased responsibility, availability of resources, collaborative opportunities, continual feedback, managerial support and professional-development opportunities are all ways to reward employees. At the end of the day, employees want to know they're getting just as much as they're putting in, and that they're making a difference in the workplace and beyond.
If you want to treat employees equitably, don't assume all rewards are created equal for all employees. For example, a $100 restaurant gift card isn't going to make Dylan feel the same way as Jaime -- Dylan would much rather have a gift card to a bookstore. Blanket and generic signs of appreciation often fall flat because they assume everyone is the same and show that you're treating everyone the same. The best managers know how each employee likes to be rewarded.
Tenet two: people actively search for empowering environments
In addition to working for rewards, we also seek to work in environments where we're treated fairly, and where we're empowered to contribute in a meaningful way. If the first tenet is met, employees feel more pride and responsibility in the work they perform. To take this further, empower your employees and provide them with the resources necessary to grow. When employees feel a company is invested in their success, they're more likely to work harder and produce more.
A lack of professional-development opportunities is one of the top reasons people leave jobs. When you're onboarding new employees or recruiting top talent, this type of environment is what will attract. To foster this environment, leaders need to know what makes each person motivated, what professional aspirations employees have and how to best empower each and every person. Gaining this information requires dynamic, proactive communication.
Tenet three: people feel stressed when they're treated unfairly
Inequity breeds disappointment. Disappointment yields stress. Stress results in a loss of productivity. When employees feel they're being treated unfairly, they become less productive.
If an employee finds out a peer is making more money for performing the same role, a manager is spending extra time with one person, or someone's ideas are unfairly favored, productivity suffers. The employee's attention is focused on the stress-inducing act instead of the task at hand. Note: Perception is reality. When people feel they're being treated unfairly, they'll work to redress the perceived inequity.
How do you know whether employees feel they are being treated unfairly? The obvious answer is to simply ask them. But when you do, be prepared to act on the response.
Nobody enjoys feeling like their ideas have no merit. A common mistake managers make is asking employees for their thoughts, opinions and ideas, but not following through with implementation or communication (why these thoughts, opinions, and ideas were or were not acted upon). If you're going to ask a question, be prepared to respond with words and actions. If it's a feasible request, work to make it happen. If it's not actionable now but may be in the future, communicate why and work with the employee on an interim solution. If it's not realistic at all, explain why and ask what other ideas the employee has to continue the discussion.
Tenet four: people who feel like they're treated unfairly will seek to balance the scales
Let's look at a scenario. Your top salesperson has been in their current position for a year. It's their first annual review. They've met and well exceeded their $1 million sales goal and is excited to receive their bonus. They get the check and are feeling pretty good about the situation. Until they find out that another employee who's been with the company for five years and met (but did not exceed) the same goal is receiving nearly double their bonus compensation.
This scenario happens. Sometimes bonuses are calculated not just on certain goals but also on company tenure. But if you're the newer employee who exceeded your sales goal, you probably are screaming in your head, "Huh?! But I sold more than this person! How is this fair?!"
Even though the bonus structure may have been laid out in a contract, this will still be a smack in the face to the high-performing employee. Since we know perception is reality, and that this employee's perception is now one of feeling undervalued and unfair, what's likely to happen?
The new person now feels a huge sense of inequity. Some of the thoughts going through this employee's mind could be:
- "Why am I not getting more money? That doesn't seem right."
- "Why am I not getting as much as him? We met the same number."
- "What am I not doing right? Am I not doing as well in something else?"
- "Why am I not appreciated? Is this the right place for me?"
- "Do I need to go find another job? Clearly they don't value me here."
If you anticipate feelings of inequity, it's best to address them proactively. This way even though an employee may feel a bit of a blow, they'll have heard it directly from, and will have had a chance to communicate about it with, you.
If unaddressed, these thoughts can lead to actions and behaviors that aren't productive or profitable -- in fact, just the opposite. They may reduce the amount of work they do. They may slow their work pace and decrease their productivity. They may express their frustration and feelings of inequity with other employees. Or they may leave the company altogether.
As a leader, make sure to address inequities -- and perceived inequities -- before they get to this last stage. Your bottom line will thank you. And so, which is even more important, will your employees.
Entrepreneur Editors' Picks
This Co-Founder Was Kicked Out of Retailers for Pitching a 'Taboo' Beauty Product. Now, Her Multi-Million-Dollar Company Sells It for More Than $20 an Ounce.
Have You Ever Obsessed Over 'What If'? According to Scientists, You Don't Actually Know What Would Have Fixed Everything.
After He Was Fired From the UFC, This Former Fighter Turned His Passion Into a Thriving Business
Most People Don't Know These 2 Things Are Resume Red Flags. A Career Expert Reveals How to Work Around Them.