Equity theory

According to the equity theory, the level of motivation which an employee depends largely on his opinion of how well or poorly she is being treated with regard to another or other employees. If the employee feels that she is being treated equally to or better than the other employees, she is likely to be highly motivated. On the flip side of the coin, if the employee feels that the other employee(s) are being treated better than her (that is, there is favoritism directed against her), she will lack the motivation to achieve the desired outcomes.
The key to having highly motivated employees is therefore to treat all of them without favoritism or discrimination. For example, all employees performing equal work must receive equal pay (Ambrose and Kulik, 1999; Werner and Mero, 1999). The Skinner Reinforcement Theory asserts that employees naturally strive towards achieving equity among themselves. This state of equity arises at the point when the ratio of the employee’s outcome over his input matches the outcome/input ratio of the other employee(s).
when the employee’s behaviors are rewarded, they will either be repeated or not, depending on whether they led to positive outcomes or negative outcomes. Rewarding positive outcomes reinforces employee behavior and leads to a repeat of positive performance. On the other hand, punishing negative outcomes causes the employees not to repeat the negative behavior (Cherrington, 2000). In line with these theories, a number of employee motivation techniques have been enumerated.

Reeve (2001) identifies these as the use of attractive incentives, the social context, positive punishers, positive reinforcers, negative reinforcers, aversive incentives, as well as negative punishers. Attractive incentives are regarded as the rewards which employees enjoy by virtue of achieving certain desired and predetermined standards of behavior or performance. Some widely used attractive incentives include stock options, performance based bonuses, and profit-sharing plans.
On their part, aversive incentives punish the employees when they fall short of the performance or behavior standards which they are required to meet. Some examples of aversive incentives include disciplinary action such as suspension or dismissal (Cherrington, 2000). According to Cherrington (2000), negative reinforcers are techniques that are deployed to compel the employees to avoid certain negative behaviors and to behave or perform according to the formbook.
Examples of negative reinforcers include close supervision, giving the employees strict deadlines for the performance of certain tasks, and so on. On their part, positive reinforcers are aimed at encouraging the employees to continue behaving or performing in a certain manner. Some positive reinforcers include employee recognition. For example, the employees can simply be thanked or given certificates that acknowledge their good work (Cherrington, 2000). The social context is also another significant motivational factor for employees.
This encompasses elements such as the organizational culture of the firm, the organizational structure, the predominant style of leadership within the organization, opportunities for advancement within the organization, and the nature of the relationships between the members of the organization (Cherrington, 2000). The experiments of Elton Mayo, famously referred to as the Hawthorne Studies, have yielded the Hawthorne effect, which also has a great influence on motivational theory.

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