What’s The Big Idea? Social Impact Framing Leads Employees To Negotiate For Less

By Dr. Insiya Hussain, Management

Job postings today are peppered with companies advertising that their work is “mission-oriented” and “makes the world a better place.”

Many employees willingly give up some pay to work for companies promoting social responsibility, because they find the work to be personally meaningful. This makes sense: People often happily trade off some features of jobs for others as a natural part of deciding between different work opportunities.

The big idea from me and my colleagues, however, is that when it comes to jobs touting a higher purpose, a different mechanism is also at play: the feeling it would be a norm violation to try negotiating higher pay — even when employees think they deserve it. Supporting this idea, we find in five multimethod studies that the strong use of social impact framing can make job candidates feel it’s taboo to ask for more compensation. Employees reported being concerned that their hiring manager would see it as selfish and inappropriate to ask for a better wage when the company appeared to be focused on the greater good. Crucially, this effect held across a variety of industries — from education to finance — and even when accounting for the organization’s perceived ability to pay.

This idea furthers work showing that managers often unfairly view employee motivation in strictly binary terms. Specifically, employees are seen as being either intrinsically or extrinsically motivated, but not both. We observe that employees are intuitively aware of this managerial bias and adjust their requests for pay accordingly in situations pitched to them as demanding greater intrinsic motivation.

The implications for employees’ livelihoods are nontrivial. Failure to negotiate even a negligible pay increase can cumulate to hundreds of thousands of dollars in a lifetime’s lost income. Are companies themselves aware that their focus on social impact (whether sincere or not) could be suppressing employee wages? If that is not their aim, greater pay transparency can help to level the playing field and ensure that employees get a fair shake no matter how much their work is focused on helping others.

Hussain, I., Pitesa, M., Thau, S., and Schaerer, M. (2024). “Pay Suppression in Social Impact Contexts: How Framing Work Around the Greater Good Inhibits Job Candidate Compensation Demands.” Organization Science, 35(2), 525-549.
https://pubsonline.informs.org/doi/abs/10.1287/orsc.2023.1675