Name:________________________________________ Program & Year: ____________ Score: ________________

Course & Cat.#: Psych 213 Time: MWF 5:00-6:00PM Teacher: Jeric Anthony S. Arnado, MAGC, RGC Date: April 15, 2020

Type of Activity:
⎕ Concept Notes ⎕ Laboratory ⎕ Individual ⎕ Quiz ⎕ Formative ⎕ Summative
Drawing out the best
in you! ⎕Exercise/Drill ⎕ Art/Drawing ⎕Pair/Group ⎕Others, specify_____________________________

Learning Activity Sheet # 9

Lesson/Topic : Employee Motivation

Learning Target(s) : (1) To determine how incentive programs motivate employees; and
(2) To identify the indicators of an effective incentive programs.

Reference(s) : Aamodt, M. (2010). Industrial – organizational psychology (6th edition). Cengage learning

Concept/Digest

An essential strategy for motivating employees is to provide an incentive for employees to accomplish
the goals set by an organization. As a result, organizations offer incentives for a wide variety of employee
behaviors, including working overtime or on weekends, making suggestions, referring applicants, staying with
the company (length-of-service awards), coming to work (attendance bonuses), not getting into accidents, and
performing at a high level (Henderson, 2006). The basis for these incentive systems are operant
conditioning principles, which states that:

Workers are motivated only when they are rewarded for their behavior at work.

Basis for Incentive Systems:

 Operant Conditioning – employees will be engaged in behaviors for which they are rewarded and avoid
behaviors for which they are punished.

DETERMINING THE EFFECTIVENESS OF INCENTIVE PROGRAMS

1. Timing of the incentive. Most effective if it occurs soon after the behavior.

2. Contingency of the consequences. If it is not possible to immediately reward or punish a behavior, it

should at least be made clear that the employee understands the behavior that brought rewards or
punishment.

3. Type of Incentive used

Premack Principle. Reinforcement is relative and that a supervisor can reinforce an employee

with something that on the surface does not appear to be a reinforce.

For example, aallowing employees to do what they enjoy or favorable working schedule. This could
result for them to be productive.
 4. Use of Individual vs. Team Based Incentives

Two Common Incentive Plans:

1. Pay for Performance – pays employees according to how much they individually produce.
2. Merit Pay – base incentives on performance appraisal scores.

Organizational Incentives
To get employees participate with the success or failure of the organization. For example,
profit sharing, gain sharing and stock options.

5. Use of Positive or Negative Incentives. Punishing those undesirable behaviors instead of rewarding
those who performs well.

6. Fairness of Reward System

According to Equity Theory, our levels of motivation and job satisfaction are related to how
fairly we believe we are treated in comparison with other.

Equity theory

When employees’ inputs are greater than his outputs (underpayment) He:
Work less hard (Havestein & Lord, 1989)
Becomes more selfish (Hardet, 1992)
Has lower job satisfaction (Carr, Mcloughlin, Hodgson & Maclachlan, 1996).

When employees’ output is greater than his inputs (overpayment) He:

Is less likely to be persuaded by his underpaid peers (Stewart & Moore, 1992)
Does not feel guilty (Lapidus & Pinkerton, 1995)
Works harder (Dunnette & Jorgenson, 1972)
Becomes more team-oriented (Harder, 1992)
Expectancy theory

Three COMPONENTS:
1. Expectancy (E). The perceived relationship between the amount of effort an employee puts in
and the resulting outcome. For example, if an employee believes no matter how hard he tries he
would not get promoted

2. Instrumentality (I). The extent to which the outcome of a worker’s performance, if noticed,
results in a particular consequence. For example, employee will be motivated if his behavior is
rewarded or punished.

3. Valence (V). The extent to which an employee value a particular consequence. For example,
Employee is rewarded with something valuable for him.

Formula: EI= E (I x V)