Purpose – The purpose of this paper is to investigate the relationship between human resource management (HRM) practices and workers' overall job satisfaction and their satisfaction with pay.
Design/methodology/approach – The paper uses British data from two different cross-sectional datasets. It estimates probit models with overall job satisfaction and satisfaction with pay as subjective dependent variables.
Findings – After controlling for personal, job and firm characteristics, it is found that several HRM practices raise workers' overall job satisfaction and their satisfaction with pay. However, these effects are only significant for non-union members. Satisfaction with pay is higher where performance-related pay and seniority-based reward systems are in place. A pay structure that is perceived to be unequal is associated with a substantial reduction in both non-union members' overall job satisfaction and their satisfaction with pay. Although HRM practices can raise workers' job satisfaction, if workplace pay inequality widens as a consequence then non-union members may experience reduced job satisfaction.
Research limitations/implications – The data sets used in the analysis are cross-sectional, presenting a snapshot of impacts of HRM practices on job satisfaction at a particular point in time. Dynamic effects are therefore not captured.
Originality/value – The paper adds to the empirical literature on effects of HRM practices, focussing on impacts on both overall job satisfaction and satisfaction with pay. A novel feature of the paper is the use of two separate data sets to develop complementary empirical results.
Uncontrolled Keywords (separate with ;):
Human resource management; Human resource strategies; Job satisfaction; Pay policies; Trade unions