Research on equity theory has almost entirely concentrated upon the behavioral consequences of inequity without concern for dissatisfaction, and has been conducted in the laboratory.
This study investigates the relationships between perceived inequity, satisfaction and turnover through field research. In this study, the equity dimensions consist of pay equity, status equity, internal equity, external equity. Two intervening variables mediating the relationships between perceived equity, satisfaction and turnover are age and leader behavior.
The data required for the tests are collected through questionaire answered by 56 middle managers in 6 big companies.
The results of data analysis support the equity theory in the field. The equity variables show the strong positive correlation with satisfaction and the strong negative correlation with turnover intention. Particularly, not only the pay equity but also the status equity shows salient importance in Korean organizations.
Age and leader behavior are found to affect the relationships between perceived equity, satisfaction and turnover.
Specifically, the more human-relations oriented the leader is, the higher the level of satisfaction is, at the same level of perceived equity.
At the same level of perceived equity, when the leader is moderately taskoriented, the satisfaction is high while when the leader is highly task-oriented, the turnover intention is low. When the leader is less task-oriented, the satisfaction is low and the turnover intention is almostly high. These results are because the subordinates cannot accomplish the high level needs, thus in this case, organization and subordinates are disadvantageous.
Turnover intention has more strong negative correlation with the perceived equity with external organization member than the perceived equity with the internal organization member.
