Abstract
The rewards employees receive in exchange for their labour play an important role in influencing their levels of job satisfaction and organisational commitment, and ultimately in retaining their services. The issues surrounding rewards are, however, complex in the field of family business. The primary objective of this paper is to investigate the influence of selected extrinsic rewards, namely, compensation, promotion opportunities and job security, on the levels of jobsatisfaction and ultimately on the levels of organisational commitment of nonfamily employees working in family businesses. Structural equation modelling was used to assess the hypothesised relationships, and the results show that compensation and job security are significantly and positively related to job satisfaction. Job satisfaction was found to be significantly and positively related to organisational commitment and also found to act as a mediator between these extrinsic rewards and organisational commitment. Establishing the perspectives that nonfamily employees have of the rewards given to them by the family businesses in which they work, provides family business owners with valuable insights into attracting and retaining this valuable stakeholder group.
Highlights
Few things elicit as much reaction in people as the rewards given to them by their employers (Byars & Rue, 2006: 243)
The primary objective of this paper is to investigate the influence of selected extrinsic rewards on the levels of job satisfaction and on the organisational commitment of nonfamily employees working in family businesses
To achieve this objective the following research questions are posed: Do the rewards Compensation, Promotion opportunities and Job security influence the levels of Job satisfaction experienced by nonfamily employees working in family businesses? Does Job satisfaction mediate the relationship between the rewards investigated in this study and the Organisational commitment of nonfamily employees to the family businesses in which they are employed? Establishing the perspectives that nonfamily employees have of the extrinsic rewards given to them by the family businesses in which they work can provide family business owners with valuable insights into attracting and retaining this valuable stakeholder group
Summary
Few things elicit as much reaction in people as the rewards given to them by their employers (Byars & Rue, 2006: 243). Promotion opportunities for nonfamily employees working in family businesses are often perceived as limited (Tsao, Chen, Lin & Hyde, 2009: 320; Chua, Chrisman & Sharma, 2003: 97), with nonfamily employees expecting to miss out on these opportunities because they are reserved for family members (Davis, Allen & Hayes, 2010: 1110; Poza, 2010: 236; Shelton, 2010). This reservation of senior positions for family members contributes to the high levels of job insecurity often experienced among nonfamily employees working in family businesses (Fishman, 2009: 205)
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