Perception and Reactions to Inequity as a Function of Social Comparison Referents and Hierarchical Levels1

Perceptions and reactions to inequity may hinge on referents of comparison and also on employees' rank in the organization. This study examined how three comparison referents—internal same-rank, external same-rank and external whole-organization—and respondents' hierarchical status in the company influence perceptions of inequity. The study also examined the relationship of perceived inequity with affect, job satisfaction, job involvement, organizational commitment, and stress. Seventy-five employees randomly selected from the three hierarchical levels of a manufacturing company (managers, supervisors, and workers) were the respondents. Results suggest that when individuals made comparisons with external same-rank and external whole-organization referents they experienced more inequity than when they made internal same-rank comparisons. Managers in comparison to supervisors and workers perceived less inequity related to pay, general rules administration, promotion, company and fringe benefits, advancement opportunities, and social power. Perception of inequity was found to be negatively related to job involvement, job satisfaction, and affect, and positively related to stress. Results implicate the role of social comparison referents in the evaluation of organizational rewards and perceptions of inequity.