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Does organizational context matter? An examination of the factors influencing employees’ judgments of minimum wage increases

Year: 2025

Type: article

Abstract: This article presents novel findings on company factors that determine judgments regarding the fairness of minimum wage increases. Drawing on minimum wage and organizational justice research, we conducted a factorial survey among German employees. It seems that the internal wage structure plays a crucial role because raising only the pay of minimum wage workers and not that of other employees causes a minimum wage increase to be rated as less fair. While a hiring freeze does not negatively influence fairness judgments, layoffs do. Finally, if a minimum wage increase adversely affects a company’s economic situation, respondents assess it as less fair.

Source: Journal for Labour Market Research

DOI: 10.1186/s12651-025-00392-3

Authors: Matthias Dütsch, Monika Senghaas, Gesine Stephan, Olaf Struck

Institutions: University of Bamberg, Federal Institute for Occupational Safety and Health, Institut für Arbeitsmarkt und Berufsforschung, Friedrich-Alexander-Universität Erlangen-Nürnberg

Language: English

Topic: Labor market dynamics and wage inequality

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: diamond

Funder: Bundesministerium für Arbeit und Soziales