I recently returned from the latest ECI Fellows meeting, which focused on behavioral ethics. This post is part of a series where I share my insights and lessons from the meeting.
If you grossly underpay someone, don’t expect superior performance.
Or ethical performance.
Of course, a small percentage of people will perform ethically and flawlessly no matter how little you pay them. Similarly, a small percentage of people will perform miserably and unethically no matter how much you pay them. But, eventually, the first will quit and the other will be fired (after costing you dearly).
The vast majority falls in the middle. The danger with underpaying someone, or with treating them unfairly in any way, is that it allows them to rationalize their bad behavior. They steal company property, they cheat on their expense report, they lie to a customer – all because they feel financial pressure and injustice. It’s the classic manifestation of the fraud triangle.
So unless you lead a volunteer organization, treat your employees fairly and pay them a decent wage. It will directly and positively affect their business and ethical performance.