The Disclosure of Executive Pay and Labor Relations: An Organizational Justice Perspective

David B. Balkin
Robert E. Allen

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DOI: 10.2190/A0HD-ERMT-0HTY-3AF5

Abstract

The disclosure of executive pay is examined from the organizational justice perspective. This perspective suggests that failure to anticipate union reaction to the disclosure of executive pay may adversely affect the relationship between the union and management. Unions may be less willing to ask their members to make sacrifices during times of economic hardship if no sacrifices are made by the top executives in terms of pay. This article provides some cases from the automobile industry to show how executive pay can influence relations with unions. Some suggestions are made to show how management might be able to coordinate executive pay policies with collective bargaining practices.

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