Final answer:
When an employee perceives underpayment inequity, they may seek a raise, become demotivated, report the issue to HR, or look for a new job. Procedural justice is crucial in determining employee reactions to pay as demonstrated by a study by Greenberg (1993).
Step-by-step explanation:
When an employee perceives underpayment inequity, there are several possible responses they might have. One reaction could be to seek a raise or promotion to rectify the perceived discrepancy in pay. However, if the employee feels too apprehensive to address the issue directly, they might become demotivated and disengaged, leading to a drop in work quality or effort. Another potential response is to report the inequity to HR, hoping that the organization will investigate and address the issue fairly. Lastly, the employee could start to look for a new job, as a means of finding a position that they feel compensates them appropriately for their contributions.
In a study by Greenberg (1993), procedural justice was shown to play a significant role in how employees react to pay rates. If the process of determining pay is seen as unfair, employees may resort to counterproductive behaviors, such as theft, as a way of seeking justice. This indicates that how an organization handles the explanation and disposition of pay rates can significantly affect employee responses to perceived inequities.