Congruence effects of contingent reward leadership intended and experienced on team effectiveness: The mediating role of distributive justice climate

Abstract

We examined why congruence in contingent reward leadership (CRL) between leaders and teams can stimulate positive team processes and effectiveness. Specifically, our study explored the effect of congruence between perceptions of CRL intended by leaders and experienced collectively by team members. We hypothesized that team distributive justice climate serves as an emergent team state through which the positive effects of CRL congruence on team effectiveness occur. We found support for hypothesized congruence effects and discuss the implications of our findings as well as future research possibilities.Practitioner points Our study demonstrates the benefits of getting leaders and teams to ‘see eye to eye’ on critical workplace perceptions such as CRL intended and experienced. The study findings indicate that distributive justice climate underlies the process through which leader–team agreement on CRL intended and experienced influences team effectiveness. Our study emphasizes the importance to examine CRL from the perspectives of both leaders and teams. Our results suggest that organization HR specialists and line managers should work together in executing compensation strategies.