Lukas believed that his company’s merit pay system would reward him fairly with a higher salary if he worked harder than other employees. his desire to work hard could be explained by the goal-setting theory of motivation.

Equity theory

Explanation:

Equity theory as proposed by John Stacey Adam argues that employees becomes dissatisfied, disgruntled and discouraged when they feel their input into a company does not commensurate with their output in form of salaries, benefit, job security, reputation, recognition, and others. The theory argues that the employees will tend to reduce their inputs and may even become disruptive in their input activities. To circumvent this, the theory argues that employers of labour must find equitable balance between the employees input and their output. This, he belief, when perceived by the employees brings contentment to the employees.

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