Wage Discrimination And Employees’ Performance

1.0 INTRODUCTION
Background Information to the Study
Employment discrimination in the workplace occurs in many forms and has several outcomes. Evident among these forms of discrimination is wage discrimination. Wage discrimination is often discussed at the societal level. Nevertheless, wage discrimination is also an important organizational topic due to the diversity of today’s workforce and the importance of employees irrespective of any form of difference in performing various critical tasks for the survival of the organization. Managing diverse workforce in performing its potentials requires equitable work environment void of unfair discrimination and practices (Channar, Abbassi, & Ujan, 2016). Employees’ feeling of unfairness in the allocation of rewards usually arises from the perception of fairness in the distribution of reward or the process used in distributing rewards. Wage is one of the most significant aspects of the employer-employee relationship. For several employees, the hope of earning a pay is the reason why they work among other reasons such as recognition, achievement, and opportunity for personal growth or affiliation with others (Umar, 2014).

According to Cornwell, Rivera, and Schmutte (2017), wage discrimination is the discrimination shown in the payments of wages towards minority groups with the same performance level and responsibilities as their co-workers. Wage inequality on the basis of race, gender, age, ethnicity, religion or color has been regarded as an unfair and unethical organizational practice which affects employee’s work attitude and behavior. In this regard, several measures have been embarked upon to combat discrimination and wage inequality in the workplace. For instance, in 1979 the National Committee on Pay Equity was established to eliminate gender and races based wage discrimination and achieve pay equity in the workplace. Also on 14 Sept 2016, the Pay Equity for All Acts (PAYE) was introduced to amend the America Fair Labor Standards Act of 1938 to ensure equity in the workplace as well as prohibiting employers from seeking or requiring previous wage information or salary history from job applicants. However, till today, pay inequality is still evident and affects Individuals from all backgrounds, at all ages, and of all levels of educational achievement (Falope, 2017).

John, Loewenstein and Rick (2014) was of the opinion that segregating employees pay on factors unrelated to performance and merit results to negative behavioral outcomes in the workplace. According to Rasch and Szypko (2018), wage equity is an important component for employees. For instance, if employees consistently observe wage is being given on the basis of age, gender, race or other discriminatory elements other than merit or performance his attitude toward the job will be affected (Neugebauer, 2014). The role of fairness in the allocation and distribution of reward in organizations has the potential to buttress the understanding of the elements influencing the job outcomes of employees involved. One of the key factors of job satisfaction or dissatisfaction with wage is how employees feel their pay package relative to others (Kifle, 2014). Pay equity is essential for pay satisfaction and optimal job outcomes.

However, Vecchio, Scufham, Hilton, and Whiteford (2019), asserts that differences in compensation for human capital endowments, such as professional qualifications, may help explain gender wage gaps; nonetheless, research persistently indicates simply being a women or employed in an occupation with skewed gender composition are major contributors to wage differentials. The causes of gender occupational segregation and wage gaps among employees have been linked sociologically and psychologically to historical idealizations defined by and for professional men, who were expected to be authoritative, rational, and committed to their jobs and earning more money; women were typically seen as lacking such traits and thus less committed to employment and becoming professional leaders (Adams, 2016; Alksnis, Desmarais & Curtis, 2018).

In order to create work harmony, managers need to identify the interest of each employee and collaborate it with an organization goals. While doing so, managers need to consider each employee as valuable jewels for the company. Fair wage practices can actually help the organizations to sustain in the long run. One of the underlying principles that should be prevalent in almost every organization is equal treatment of all employee. Diversity and equality have become integral part of every organization. Diverse workforce includes of individuals belonging to different culture who have their own expectations and aspirations (Loden & Rosener, 2019). Employees from diverse background long for respect and equal pay structure in their workplace. However, age, gender, race should not be a factor influencing this course of action. Thus, employees should be treated equally and compensated irrespective of their age, gender and race. Wage discrimination on the basis of age, gender and race is detrimental to any organization, as it affect individual performance.