Searching for Pay Equity: The Role of Pay Compression on Individual-Level Outcomes

August 13, 2004
Pay compression occurs when employees with more seniority receive pay rates nearly equal to newer employees. Based upon equity theory, Amy B. Henley (University of Texas), George S. Benson (University of Texas), and Gary C. McMahan (University of Texas) hypothesize that pay compression will influence employee perceptions of pay equity.

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