Nice guys finish last? Altruistic companies can ‘guilt-trip’ employees into taking less money

AUSTIN, Texas — The ethics, conduct, and business practices of potential employers have never been more important to the average job seeker. Many people say they don’t want to work for “evil” corporations, and many professionals nowadays actively seek out roles that align with their personal beliefs. However, interesting new research suggests that when many job seekers finally land an opportunity with an “altruistic” organization, they may end up feeling too guilty to ask for a raise.

Conducted at the McCombs School of Business at The University of Texas at Austin, study authors report that with more and more companies nowadays claiming they “make an impact,” organizations are actually guilting job candidates into accepting less pay for their contributions.

Researchers explain that both for-profit and non-profit organizations are increasingly utilizing what’s called “social impact framing” — an approach that emphasizes a company’s work and its welfare benefits for society.

While many of these companies may be totally legitimate in their pursuit of positive change and subsequent social impact framing, this new research illustrates how it can also work against prospective employees during salary negotiations. More specifically, researchers found job candidates exposed to such messaging often felt it would be against “the company norm” to ask for more money.

“This speaks to a broader social phenomenon about how we view money when it comes to doing good,” Texas McCombs Assistant Professor of Management Insiya Hussain says in a university release. “There’s an implicit assumption that money and altruism don’t mix. Money taints attempts to do good. Even if job candidates might not necessarily subscribe to this view, they’re assuming that hiring managers will.”

two women sitting beside table and talking
(Photo by Christina @ on Unsplash)

Workers feel ‘uncomfortable’ making salary demands

Prof. Hussain, in collaboration with Marko Pitesa and Michael Schaerer of Singapore Management University and Stefan Thau of INSEAD, discovered that candidates exposed to social impact framing typically refrained from negotiating for higher salaries. Why? They felt uncomfortable with that “ask.”

Candidates told study authors they were worried that asking for more money from an organization emphasizing altruism would be perceived as inappropriate by hiring managers. The research team described this attitude as one “self-censoring” themselves, which Prof. Hussain adds is a unique finding for research focusing on social impact framing and wage demands. Earlier studies assumed candidates sacrificed pay for meaningful work, but this study shows this effect may be due to job candidates feeling uncomfortable with negotiating.

Ultimately, researchers say it is unclear if companies are intentionally using social impact framing to suppress pay. Either way, though, they believe managers should be aware of this tendency, as it could potentially cost a company in terms of human resources. If a manager is properly educated on this matter, he or she can better temper their approach to prospective employees who do dare to ask about material rewards.

Study authors also suggest managers foster an atmosphere of transparency when it comes to company norms and values in reference to monetary compensation, and that job rewards be offered based on objective criteria as opposed to salary negotiations.

Job seekers could consider whether companies that stress social impact take care of their own employees — financially or otherwise,” Prof. Hussain concludes. “And companies shouldn’t assume that extrinsically motivated workers don’t care about the job and aren’t willing to work hard to perform well.”

The study is published in Organization Science.

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