Academic salary compression and inversion: An inquiry into university pay administration

Remigijus Vaicys, Louisiana Tech University


The purpose of this dissertation was to ascertain what the effects of a compressed and/or inverted pay system were on a select group of colleges of business faculty.

Literature suggests that inequitable compensation systems eventually lead to feelings of injustice. These feelings manifest themselves by behavioral and attitudinal changes as well as by lowered feelings of job satisfaction. To test this, a questionnaire was mailed to 479 management faculty members at selected colleges and universities. One hundred eighty-five usable questionnaires were returned. Analysis of the data was accomplished through the use of the Kolmogorov-Smirnov two sample test.

Twenty hypotheses were developed and tested in this study. Results of these tests indicated that in institutions where only salary compression was perceived to exist significant differences between the groups were found in two areas: perception of the possibility of others leaving the institution due to pay dissatisfaction and comparison of pay with other institutions.

Of the respondents who perceived salary inversion or both salary inversion and compression to exist at their institutions, nine out of ten hypotheses were rejected. The only hypothesis that was accepted dealt with the respondents' intentions to leave their present institution. In general, the more senior group of respondents was much less satisfied with the pay-related variables than were the less senior respondents. The data presented in this study supports the speculation that highly inequitable pay systems such as inverted pay systems result in lower levels of job satisfaction for the affected respondents.

The study was concluded with recommendations for further research.