(Not) Hanging on the Telephone: Payment Systems in the New Sweatshops

Sue Fernie · David H. Metcalf

295 citations0/0 files storedRePEc: Research Papers in Economics

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Accounting and Organizational Management Labor market dynamics and wage inequality Management Theory and Practice

Abstract

'The ultimate objective of empirical work on incentives should be to find out why firms use the compensation systems they doàhuge advances in our understanding could be made by a concerted effort to collect data on contracts.' So concludes the 1998 Journal of Economic Literature survey on compensation systems. This paper does just that. It presents very detailed case study evidence on contracts in four organizations, three of which are call centres, the fastest growing sector of employment in the UK. This evidence is used to test predictions from the New Economics of Personnel (NEP) concerning the incidence of payment systems. We also contrast and test predictions from NEP with those of the earlier British Institutional School, which anticipated many of NEP's ideas on payment systems. Variations in the ratio of performance-related to basic pay among our organizations can, broadly, be explained by the costs and benefits of monitoring inputs and measuring output, which comprises the core of NEP. Indeed, the monitoring of our case study employees is the theme which binds the paper together û for call centres Jeremy Bentham's 1791 Panopticon was truly the vision of the future.

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References

1977Institutionalized Organizations: Formal Structure as Myth and Ceremony 1996Discipline and Punish: The Birth of the Prison.1987Institutional Theories of Organization 1995The Transformation of American Industrial Relations.1989The Employer Size-Wage Effect 1988AGENCY- AND INSTITUTIONAL-THEORY EXPLANATIONS: THE CASE OF RETAIL SALES COMPENSATION.

Cited by

2001Future work design research and practice: Towards an elaborated model of work design 2000'Fun and surveillance': the paradox of high commitment management in call centres 2002The Effects of Performance Monitoring on Emotional Labor and Well-Being in Call Centers 2006Resist, comply or workaround? An examination of different facets of user engagement with information systems 2010‘Being yourself ’ in the electronic sweatshop: New forms of normative control 2002Work Organization, Control and the Experience of Work in Call Centres 2001The intensification of work in Europe

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