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THE RELATION BETWEEN REMUNERATION AND JOB SATISFACTION: A CASE

STUDY OF PUBLIC ADMINISTRATION EMPLOYEES IN POMERANIA REGION IN
POLAND

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References
1. Dudarev, V.B. (2008). Statisticheskoe issledovanie demograficheskoj bezopasnosti Rossii
[Statistical study of demographic security of Russia]. Extended abstract of candidates thesis.
Moscow [in Russian].
2. Zakon Ukrainy Pro demohrafichnu bezpeku Ukrainy (proekt vid 15.10.2003, B4269)
[Law of Ukraine On demographic security of Ukraine (draft from October 15 2003, B4269)].
Retrieved from http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_2?id=&pf3516=4269&skl=5 [in
Ukrainian].
3. Kolmakova, O.M., & Smachylo, V.V. (2013). Otsinka demohrafichnoi bezpeky
[Estimation of demographic security]. Retrieved from
http://www.rusnauka.com/7_NITSB_2013/Economics/15_130526.doc.htm [in Ukrainian].
4. Krymzin, D.N. (2011). Integral’naja ocenka demograficheskoj bezopasnosti regiona (na
primere respubliki Mordovija) [Integral assessment of demographic security of the region (on
example of the Republic of Mordovia)]. Retrieved from http://sisupr.mrsu.ru/2011-
4/PDF/5/Kryimzin.pdf [in Russian].
5. Metodyka rozrakhunku rivnia ekonomichnoi bezpeky Ukrainy, zatverdzhena nakazom
Ministerstva ekonomiky Ukrainy vid 02.03.2007, B60 [The method of calculation of economic
security of Ukraine, approved by the Ministry of Economy of Ukraine from March 2 2007,
B60)]. Retrieved from http://zakon.nau.ua/doc/?code=v0060665-07 [in Ukrainian].
6. Sukhorukova, A.I. (Eds.) (2003) Metodychni rekomendatsii shchodo otsinky rivnia
ekonomichnoi bezpeky Ukrainy [Guidelines on the assessment of the level of economic security
of Ukraine]. Kyiv: Natsionalnyi instytut problem mizhnarodnoi bezpeky [in Ukrainian].
7. Ofitsiinyi sait derzhavnoi sluzhby statystyky Ukrainy [Substantiation of basic qualitative
and quantitative indicators of demographic security of Ukraine]. ukrstat.gov.ua. Retrieved from
http://ukrstat.gov.ua/ [in Ukrainian].
8. Roi, I.V. (2011). Obgruntuvannia osnovnykh yakisnykh ta kilkisnykh pokaznykiv
demohrafichnoi bezpeky Ukrainy [Substantiation of basic qualitative and quantitative indicators
of demographic security of Ukraine]. Sosioprostir: mizhdystsyplinarnyi zbirnyk naukovykh prats
z sotsiolohii ta sotsialnoi roboty — Sosioprostir: interdisciplinary scientific research journal of
sociology and social work, 1(2), 24-27 [in Ukrainian].
9. Stetsenko, S.H. (2005). Demohrafichna statystyka [Demographic statistics]. Kyiv:
Vyshcha shkola [in Ukrainian].
10. Khomyn, O.Y. (2010). Metodyka rozrakhunku demohrafichnoi bezpeky [The method of
calculation of demographic security]. Visnyk ekonomiky transportu i promyslovosti — Bulletin
of economics of transport and industry, 29, 188-191 [in Ukrainian].
11. Chmyhalo, A.Ju. (2007). Social’naja bezopasnost’ [Social Security]. Tomsk: Izd-vo
TPU. Retrieved from http://txtb.ru/125/16.html [in Russian].

)4$44. -$:CDE%$ :& >0:$8*CF 21.03.2015 >.

UD) 331.10
Sylwia Bia as,
PhD,
Institute of Management, Faculty of Management
University of Gdansk, Gdansk, Poland
[email protected]

123
 Joanna Litwin,
PhD,
Institute of Management, Faculty of Management
University of Gdansk, Gdansk, Poland
[email protected]
Jaros aw Wa!niewski,
PhD,
Institute of Management, Faculty of Management
University of Gdansk, Gdansk, Poland
[email protected]
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THE RELATION BETWEEN REMUNERATION

AND JOB SATISFACTION: A CASE STUDY OF PUBLIC
ADMINISTRATION EMPLOYEES IN POMERANIA REGION IN POLAND

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Remuneration is considered one of the key factors encouraging people to work. However, its
significance for the employee and its effect on job satisfaction remains unclear. The aim of
this paper was determining how remuneration affects job satisfaction among public
administration employees from one of Eastern-European countries. The study was conducted
by carrying out a survey among employees of 10 public administration offices of the
Pomerania Region in Poland. The analysis of the results allowed to draw conclusions on the
significance of remuneration in the context of other satisfaction factors, and to assess how
relative assessment of the amount of remuneration can affect the relation between
remuneration and overall job satisfaction.

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Keywords. Job satisfaction, facets of job satisfaction, public sector, public administration,
remuneration, compensation

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Introduction. Remuneration constitutes one of the factors affecting job satisfaction.

However, its significance may differ, depending on the external factors (e.g. national
culture) and the employees’ characteristics (e.g. age or held position). Moreover, the
effect of remuneration on job satisfaction might depend on the employees’ subjective
assessment of the amount of remuneration [see 36, 243-252]. Therefore, it is important
to analyze the significance of remuneration in the context of other factors related to job
satisfaction among employees in countries from different spheres of cultural influence.
In particular, there is a lack of such studies conducted in Central and East European
countries. Results of previous studies on the effect of remuneration on job satisfaction,
conducted mostly in Anglo-Saxon and Asian countries, need to be verified due to the
specific cultural, historical and economic conditions in Eastern European countries.
We attempted to show how the assessment of the level of remuneration affects the
level of job satisfaction among public administration employees in Poland. This
relationship is all the more significant in the face of the need for reforms of public
administration in post-socialist countries. During the 45-year long period of centrally
planned economy, Polish public administration employees had developed a specific

125
approach to their clients, who were treated not as customers, but rather intruders. This
attitude was reinforced by the dominant role of public officials, who were, at the time,
the sole overseers of goods which were in great demand, but in very short supply [29].
This deeply rooted approach gave rise to the development of peculiar and inappropriate
relationships between public administration employees and their clients. The negative
view of public administration was corroborated by the results of a research by Polish
Ministry of Internal Affairs and Administration, which showed that many Polish citizens
still object to working in public administration offices [33]. Only 42% of respondents
believe that Polish administration officials operate efficiently and perform their tasks
quickly and on time. More than half of public administration clients in Poland continue
to evaluate staff of public institutions negatively. The fact that in 2006, 72% of Poles
declared that their trust in EU administration was greater than in the national one
provides further indication of continuing need for improvement in the functioning of
public administration in Poland [4, 69].
Presently, Poland, as a member state of the EU and the EUPAN (European Union
Public Administration Network), is implementing procedures aimed at increasing
customer satisfaction, in order to determine the role it plays in public affairs. The
underlying idea is, that the public sector should be constantly evolving to meet new
challenges and respond to changing needs of the society. Therefore, customer
satisfaction management in public institutions is essential for assessing whether the
officials are indeed conducting their professional duties in a professional manner [8].
This is not possible without changing the work attitude of public sector employees by
properly developed incentive systems, aimed at increasing job satisfaction. This paper
discusses the results of a survey carried out among 272 public administration officials
employed at 10 local public administration offices. Based on the data gathered in the
survey, we assessed the effect of remuneration on job satisfaction. Moreover, we
analyzed how subjective assessment of the amount of remuneration may affect the level
of satisfaction from remuneration.
The significance of job satisfaction and factors determining job satisfaction. Job
satisfaction was a subject of interest for researchers and practitioners for over 80 years.
Judge et al. reported that it was the subject of over 7,000 studies, up until the year 2000
[22, 25-26]. Job satisfaction can be defined as the positive and negative feelings and
attitudes that relate to the duties performed by employees. According to Locke, job
satisfaction is «a pleasurable or positive emotional state that results from appraisal of
one’s job or job experience» [27, 1304]. Job satisfaction is characterized in more detail
by definitions relating to its source, which define it as the distance between what a
person feels at work and what he or she actually experiences (according to subjective
assessment) [20, 1007].
Interest surrounding studies identifying the factors affecting job satisfaction is a
result of the significance which is currently placed on employees. One of the directions
of current research is the analysis of the relation between satisfaction and efficiency at
work. Previous studies on job satisfaction put forth hypotheses that there is a direct link
between an employee’s level of job satisfaction and efficiency. Modern studies disprove
this notion. Being content with one’s job and satisfied with its particular elements do
not always ensure better and more efficient work of particular employees [16, 57].
However, the researchers agree that there is a codependence between employee
satisfaction and efficiency in the context of the entire organization [17, 523-540].
Moreover, studies on job satisfaction show a positive correlation between job
satisfaction of the employees and the satisfaction of their clients [26,167; 16,57].
Furthermore, job satisfaction is perceived as one of the elements assisting and
reinforcing the motivation system [25, 247]. It is due to the fact that satisfied employees
126
create positive atmosphere in the workplace. The level of job satisfaction is also
connected with absenteeism [13, 135-141] and turnover [3, 223-242]. Furthermore,
insufficient level of job satisfaction can lead to counterproductive work behaviors
(CWB) [30, 598-599; 38, 30-41]. CWBs can be defined as any behavior detrimental to
the objectives of the organization, violating organization‘s standards, or facilitating the
decline of productivity [12, 291-292]. CWBs are harmful, because they are voluntary
and conscious decisions of the employees, who revert to such behaviors despite of the
fact that their detection may result in sanctions imposed by the employer.
The effect of remuneration on job satisfaction. Remuneration is one of the most
significant variables used when explicating the overall level of job satisfaction [34, 357-
367]. Satisfaction from remuneration is defined as the congruency between an
employee’s expectations and actual remuneration. Employees assess their remuneration
based on the equity principle, which is defined as «a comparison between what people
believe they deserve to be paid and what others deserve to be paid» [21, 401].
Employees use two assessment criteria: internal and external equity. The former allows
to assess an individual’s remuneration in the context of their services to the organization
(cf. Adams’ Equity Theory). The latter allows to assess the level of an individual’s
remuneration in the context of remuneration received by other members of the
organization and in the context of remuneration offered on similar positions in other
organizations. As a result of these comparisons, an individual may feel under-rewarded,
which in turn can lead to decrease in satisfaction from remuneration and, finally, to
decreased work-efficiency, decreased commitment to work and even to an increase in
fluctuation [1]. Faulk [10] has divided different levels of satisfaction from remuneration
into: scope of reference (directing the actions of the employees either on the entire
organization, or on own work) and sources of consequences (employees’ rational or
emotional grounds for functioning). Employees show the following attitudes and types
of behavior towards their organization: altruism, politeness, conscientiousness,
initiative, positive attitude to work. From among the attitudes and types of behavior
towards work, the most prominent one is individual efficiency at work. The sources of
consequences can be either rational or emotional. In the latter case, the assessment of
equity of remuneration, i.e. feelings towards remuneration, its components and means of
assigning it, plays a significant role. The results of a study by Faulk [10], on 526
employees of a public sector company, corroborate this relation. The effect of
satisfaction from remuneration is limited to the attitudes and behaviors connected to an
individual’s work, and is not significantly connected to efficiency at work, it may even
lead to reinforcing standards of behaviors aimed at maintaining the status quo. Also
Gaertner [14] reported a lack of relation between the amount of remuneration and job
satisfaction. However, results of studies show that job satisfaction is affected by feelings
of equity.
Moreover, results of comparative studies show that the significance of remuneration
for total job satisfaction is not the same among employees from work-groups singled out
based on demographic factors or country of origin [e.g. 28, 45-66; 11, 559-580; 9, 272-
297]. Varying levels significance placed on remuneration in different countries are
mostly the result of their cultural and economic differences. The effect of the economic
environment on the needs of employees can be explained with Maslow’s Theory of
Motivation. The more base needs, which include remuneration, constitute a more
significant motivator in countries with lower standards of living [more: 18, 159-179].
Studies conducted among Dutch employees show that wages do not significantly affect
job satisfaction [15, 363-367]. Furthermore, the analysis of a survey research in five
Western countries and Hungary show that employees place great importance on intrinsic
rewards, such as doing an interesting job and having autonomy at work [39, 811-828].
127
In contrast, research conducted among employees from Hong Kong [2, 573-596] and
China [9, 272-297] reported financial rewards as the most significant factor. Also
Rafikul and Ahmad [35, 344-362] found «high wages» were the most significant for
Malaysian employees in all distinguished groups.
Sex is one of the main individual characteristics taken into account by researchers
analyzing the effect of particular factors on employee satisfaction, seeing as sex and age
are the two most fundamental demographic groups a person belongs to. Study results
show men and women clearly differ in preferred satisfaction factors. Previous studies
suggest that women’s job satisfaction is strongly affected by social factors, while for
men, autonomy at work and the possibility of self-realization of tasks and pay are some
of the most important factors [32, 49-58]. Kamdron [24, 1211-1240] research shows that
for female higher officials, recognition and good relationship are of high importance,
while men consider responsibility as more important. A research among Chinese
employees revealed that for women good pay is not as important a factor as for their
male counterparts [9, 272-297].
Methodology and Results. The survey was conducted in 10 local public
administration organizations, which gave consent for participation in the study. The
researched organizations were located in Pomerania region, which, according to
National Heritage Board of Poland, is one of most culturally diversified in Poland.
Moreover, they were located in cities with diverse populations and with different
economic situations and labor markets. Thus, the subjects enrolled into the study came
from diverse cultural and economic background. The surveys were conducted among
civil servants at local administration offices. Local public administration employees are
in more direct contact with the public than civil servants employed at national level
institutions. Focusing on just one type of organizations did not allow a wider
generalization of the research results, but also offered certain advantages, allowing to
demonstrate effects specific for the chosen type of organizations [5, 7-27]. Some
demographic questions were also included in the survey. The questionnaire was
anonymous and distributed to the participants by their office managers.
The study population comprised of 272 employees. The response rate was 31%. The
respondents’ respective positions in their organization were as follows: 14.12% held
managerial positions, 49.8% were administration employees, 11.76% were blue-collar
workers, and 24.31% — specialists. The majority of the respondents were female
(64.34%) who held a university degree (74%). This sample, especially in respect to sex
and age, reflects the composition of Polish public administration organizations where
highly educated middle-aged women are overrepresented. According to statistics
provided by Polish government in 2012, women employees made up about 69.4% of the
workforce. Civilian workforce in Poland is mostly comprised of people in the age
between 31-50 years old (55.3%). Employees under 30 years old comprise only
14.1% [6].
The survey consisted of a questionnaire with questions about the significance of
particular factors comprising satisfaction for the employees (How important is each of
the following things to you?) and, in the case of remuneration, assessment how common
they are in the employees’ organizations (How likely is it that each of these things
would happen at your workplace?). The responses were given on a rating Likert scale,
with 1 corresponding to completely not important/does not happen and 5 to very
important/happens frequently. Moreover, the questionnaire contained questions about
overall job satisfaction. The employees assessed their level of job satisfaction on a 1-4
scale, with 1 corresponding to really not satisfied and 4 to really satisfied. The
questionnaire also contained question about their absolute income, i.e. which pay group

128
they are in, and about their relative income, i.e. how they assess their current income
compared to remuneration offered in other public organizations.
A comparison of the significance of remuneration, such as basic pay, performance
bonuses, employee benefits and 13 factors affecting job satisfaction allows to conclude
that respondents indicated non-material factors affecting job satisfaction as more
significant. Two factors, good relationship with co-workers (mean 4.7) and job security
(mean 4.59), were named as most significant for the level of job satisfaction. The
respondents rated basic salary (mean 3.91, item 13 among 16 factors listed in the
questionnaire) as having low significance for their wellbeing at work, compared with
other factors. They placed more significance on other types of remuneration, such as
bonuses (significance at 4.44, item 5) and employee benefits (4.12, item 9).
We have also compared how male and female respondents assessed the significance
of different elements of remuneration. The results are presented in Table 1.
Table 1
DIFFERENCES IN HOW MALE AND FEMALE RESPONDENTS ASSESS
THE SIGNIFICANCE OF DIFFERENT ELEMENTS OF REMUNERATION

Females Males
Basic Remuneration 4.01 3.71
Performance Bonuses 4.59 4.20
Employee Benefits 4.20 3.95

Pearson’s correlation was used to analyze the relationships between job satisfaction
and level of satisfaction from remuneration, bonuses, employee benefits and relative and
absolute value of income. The results are presented in Table 2.
Table 2
PEARSON’S CORRELATION BETWEEN JOB SATISFACTION
AND DIFFERENT ELEMENTS OF REMUNERATION

Assessment
Total Relative
Satisfaction Basic Employee Income
Remuneration Bonus Benefits
Total Satisfaction
Assessment :
Basic Remuneration 0,36
Bonus 0,35 0,55
Employee Benefits 0,18 0,36 0,38
Value of Income:
absolute 0,05 0,10 –0,20 –0,31
relative 0,32 0,38 0,21 0,08 0,35
p < 0.05
Analysis shows that absolute income was not significantly correlated with job
satisfaction (r=0.05, p<0.05). There is a correlation between subjective assessment of
received remuneration, compared with remuneration offered by other public
organization, and total job satisfaction (r=0.32, p<0.05).
We also tried to determine the level of satisfaction from remuneration, defined as the
difference between expectations (assessed on a 5-level scale) and actual amount of
particular elements of remuneration (also assessed on a 5-level scale). The smaller the
difference, the higher the assessment of satisfaction from particular elements of
129
remuneration. The table below presents overall satisfaction of the study population and
separate results for males and females.
Table 3
SATISFACTION FROM REMUNERATION

According to Sex
Participants in Total
Males Females
Basic Remuneration 1,36 –1,01 –1,58
Performance Bonuses 2,19 –1,88 –2,38
Employee Benefits 1,08 –0,81 –1,26

Moreover, we analyzed the relation between satisfaction from particular elements of

remuneration and overall job satisfaction. The results are presented in Table 4.
Table 4
CORRELATION BETWEEN SATISFACTION FROM PARTICULAR ELEMENTS
OF REMUNERATION AND OVERALL JOB SATISFACTION

Overall Job Satisfaction from Satisfaction from

Satisfaction Basic Remuneration Performance
Bonuses
Overall Job Satisfaction 1,00
Satisfaction from Basic Remuneration 0,25 1,00
Satisfaction from Performance Bonuses 0,32 0,62 1,00
Satisfaction from Employee Benefits 0,22 0,5 0,59

p <0.05
The results presented in the Table above show that performance bonuses are the
element of remuneration with the most significant effect on overall job satisfaction. The
respondents indicated employee benefits as the least important element.
Conclusions. The results of this study show that public administration employees in
Poland place less importance on material remuneration in achieving job satisfaction,
than on other factors. This is contrary to the results of previous studies conducted
among Polish employees of retail companies [19, 383-392]. This inconsistency may be
the result of different types of studied organizations or, what is more probable, the result
of changes in the attitudes and expectations of employees in the span of the last 15
years. On the other hand, the results of this study are consistent with the results of
studies on satisfaction in West European countries and the USA, where remuneration is
not indicated as the main factor affecting job satisfaction [39, 811-828].
Correlation between the amount of remuneration and job satisfaction confirmed that
subjective assessment of remuneration is much more significant than the assessment of
absolute remuneration (in case of current study, comparison with remuneration offered
in other public organizations, not gross remuneration).
Vast discrepancies in the significance of particular elements of remuneration for men
and women are mostly the result of different needs of these two groups, determined
mainly by cultural and society factors and the resultant roles assigned to the sexes. The
results of the study on the amount of remuneration of men and women show that these
discrepancies still exist. Women, despite their education, work experience, sector of
economy they work in or position they hold, earn 20% less than men [37]. Similar
discrepancies are reported by the Supreme Audit Office (NIK). An audit carried out in
2013 in public administration offices in Poland showed an almost 11% discrepancy in

130
remuneration between male and female employees [7]. Differences in remuneration are
caused by many factors, however the attitude of female employees towards
remuneration and resulting job satisfaction is mostly the result of women’s awareness
about their position on the job market, which is strongly determined by the periods of
inactivity caused by maternity. Still, previous studies show that these discrepancies
disappear in countries which offer opportunities for men and women (such as
Scandinavian countries) [see 23, 75-94].
The results on satisfaction from remuneration show that the employees of Polish
public administration are the least satisfied with performance bonuses (the greatest
difference between expected and actual amount). It is noteworthy, this factor had the
strongest positive correlation with overall job satisfaction. The significance of
performance bonuses in job satisfaction is corroborated by the results of previous
studies [17, 523-540]. The large disproportion between expectations and actual situation
can be caused by the relatively low bonuses received by the employees from the public
sector, in comparison with the private sector [37]. This discrepancy is the result of the
inability to calculate work productivity on some public administration positions.
Therefore, performance bonuses are not as diversified as the employees expect.
The major role of the current study is supplying information on how material factors
contribute to overall job satisfaction among Polish employees, in order to provide a
better understanding of job satisfaction and better insight into job-related attitudes. This
knowledge is vital for achieving the desired level of employee satisfaction and, in
consequence, improve the efficiency and quality of public service. This research also
expanded earlier findings in this field. A comparison of the obtained results with
previous research constitutes a material for cross-cultural comparison.
The main limitation of this study was limiting the study population to public sector
employees. On the one hand, it allowed for a better understanding of their attitudes,
which is significant in the context of previous studies reporting differences in levels of
job satisfaction between public and private sector employees [more: 31]. On the other
hand, focusing on just one type of organizations did not allow a wider generalization of
the research results. Future studies should include employees from the private sector.

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PhD Econ., associate Professor,
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SHEI «Kyiv National Economic University named after Vadym Hetman»

133

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