Adams’ Equity Theory calls for a fair balance to be struck between an employee’s inputs (hard work, skill level, tolerance, enthusiasm, etc.) and an employee’s outputs (salary, benefits, intangibles such as recognition, etc.). According to the theory, finding this fair balance serves to ensure a strong and productive relationship is achieved with the employee, with the overall result being contented, motivated employees. Adams’ Equity Theory acknowledges that subtle and variable factors affect an employee’s assessment and perception of their relationship with their work and their employer.
The theory is built-on the belief that employees become de-motivated, both in relation to their job and their employer, if they feel as though their inputs are greater than the outputs. Employees can be expected to respond to this in different ways, including de-motivation (generally to the extent the employee perceives the disparity between the inputs and the outputs exist), reduced effort, becoming disgruntled, or, in more extreme cases, perhaps even disruptive.
McCarthy evidenced sincere attempts at supervision and seemed to perform his work efficiently but at the same time, he had an agreement with Purvis by which he was supposed to initiate cost cutting measures within the company. This led to McCarthy single-mindedly initiate an economy program designed to increase his earnings. He did everything to reduce the operating cost of the Parlor. He changed the wholesale meat supplier and lowered both his cost and produce quality in the process and he reduced the size and portion of everything on the menu, including those fabulous sundaes and sodas.
McCarthy increased the working hours of those on minimum wage and reduced the time of those employed at a higher rate. Moreover, he eliminated the fringe benefit of a one-dollar meal credit for employees who worked longer than a...