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Individual pay for performance and commitment HR practices in South Korea

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  • Chang, Eunmi

Abstract

Despite the rapid growth of the use of pay-for-individual-performance systems in collectivistic societies including Korea, there are very few empirical studies regarding their effects on employee attitudes. With a data-set of 37 companies and 959 employees from South Korea, this research examines whether the new compensation system influences Korean employees' organizational commitment and work effort and how these effects are moderated by HR practices. Using Hierarchical Linear Modeling, we found that pay-for-individual performance and commitment to HR practices did not have effects on organizational commitment, but a positive interaction effect was found. Regarding work effort, positive effects of pay-for-individual performance and the commitment HR were found as well as a significant interaction effect between them. Implications of the results are included.

Suggested Citation

  • Chang, Eunmi, 2006. "Individual pay for performance and commitment HR practices in South Korea," Journal of World Business, Elsevier, vol. 41(4), pages 368-381, December.
    • Handle: RePEc:eee:worbus:v:41:y:2006:i:4:p:368-381
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    References listed on IDEAS

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    1. Chang, Eunmi, 2003. "Composite effects of extrinsic motivation on work effort: case of Korean employees," Journal of World Business, Elsevier, vol. 38(1), pages 70-79, February.
    2. Johngseok Bae, 1997. "Beyond Seniority-Based Systems: A Paradigm Shift in Korean HRM?," Asia Pacific Business Review, Taylor & Francis Journals, vol. 3(4), pages 82-110, June.
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    1. Shelash, Mohammad & Sulieman, Ibraheem, 2011. "Human resource management practices in ZAIN cellular communications company operating in Jordan," Perspectives of Innovations, Economics and Business (PIEB), Prague Development Center (PRADEC), vol. 8(2), pages 1-9, August.
    2. Myeong-Hun Lim & Jin-Ha Yoon & Won-Tae Lee & Min-Seok Kim & Seong-Uk Baek & Jong-Uk Won, 2023. "Performance-Based Pay System and Job Stress Related to Depression/Anxiety in Korea: Analysis of Korea Working Condition Survey," IJERPH, MDPI, vol. 20(5), pages 1-13, February.
    3. Magoshi, Emiko & Chang, Eunmi, 2009. "Diversity management and the effects on employees' organizational commitment: Evidence from Japan and Korea," Journal of World Business, Elsevier, vol. 44(1), pages 31-40, January.
    4. Sunny Sun & Xia Zhao & Haibin Yang, 2010. "Executive compensation in Asia: A critical review and outlook," Asia Pacific Journal of Management, Springer, vol. 27(4), pages 775-802, December.
    5. Clint Chadwick & Janice F. Super & Kiwook Kwon, 2015. "Resource orchestration in practice: CEO emphasis on SHRM, commitment-based HR systems, and firm performance," Strategic Management Journal, Wiley Blackwell, vol. 36(3), pages 360-376, March.
    6. Sulieman Ibraheem Shelash Mohammad, 2011. "Human Resource Management Practices In Zain Cellular Communications Company Operating In Jordan," Perspectives of Innovation in Economics and Business (PIEB), Prague Development Center, vol. 8(2), pages 26-34, August.
    7. Dan V. Caprar & Sunghoon Kim & Benjamin W. Walker & Paula Caligiuri, 2022. "Beyond “Doing as the Romans Do”: A review of research on countercultural business practices," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(7), pages 1449-1483, September.
    8. Horak, Sven, 2013. "Cross-cultural experimental economics and indigenous management research: Issues and contributions," Working Papers on East Asian Studies 92/2013, University of Duisburg-Essen, Institute of East Asian Studies IN-EAST.
    9. Park, Rhokeun, 2012. "Cognitive and affective approaches to employee participation: Integration of the two approaches," Journal of World Business, Elsevier, vol. 47(3), pages 450-458.
    10. Qi Wei & Chris Rowley, 2008. "Changing patterns of rewards in Asia: a literature review," Asia Pacific Business Review, Taylor & Francis Journals, vol. 15(4), pages 489-506, September.
    11. Chul Chung & Masayuki Furusawa, 2015. "The HRM of Foreign MNCs Operating in Europe," John H Dunning Centre for International Business Discussion Papers jhd-dp2015-04, Henley Business School, University of Reading.

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