Abstract
Orientation: This study explores how pay transparency influences employee job performance within commission-driven environments in the South African property industry.
Research purpose: How pay transparency influences employee job performance in commission-driven environments in the South African property industry.
Motivation for the study: Pay secrecy undermines motivation and discretionary effort, particularly in commission-based roles.
Research approach/design and method: A qualitative, interpretivist case study design was employed. Semi-structured interviews were conducted with 15 participants comprising senior managers and property managers from three Johannesburg-based Real Estate Investment Trusts operating in the student accommodation sector. Data were analysed using reflexive thematic analysis.
Main findings: The findings reveal that pay transparency enhances job performance by clarifying effort–reward linkages, enabling self-regulation and reducing performance uncertainty.
Practical/managerial implications: Organisations should prioritise procedural clarity, transparent performance criteria and ongoing communication to leverage pay transparency as a performance management tool.
Contribution/value-add: This study provides rare qualitative evidence from a Global South, commission-based industry, addressing a significant gap in pay transparency literature.
Keywords: pay transparency; job performance; commission-based pay; equity theory; agency theory; South Africa.
Introduction
Pay transparency has emerged as a critical human resource management (HRM) practice with far-reaching implications for employee attitudes, employment relationships and organisational outcomes. Globally, it has moved to the forefront of compensation debates as employees increasingly demand fairness, accountability and clarity regarding how pay is determined and distributed (Avdul et al., 2024). These expectations are particularly salient among younger employees and in contexts characterised by heightened income inequality. Prior research has consistently linked transparent pay systems to enhanced perceptions of fairness, trust and legitimacy within organisations (Stofberg et al., 2022a), positioning pay transparency as an increasingly salient organisational practice.
Pay transparency has become one of the most prominent topics in contemporary HRM research and practice because of its influence on employee–employer relationships, organisational culture and performance-related outcomes (Alterman et al., 2021; Načinović Braje & Kuvač, 2022; Stofberg et al., 2022a). From an organisational perspective, it is frequently examined in terms of its potential costs and benefits, including its effects on motivation, engagement, retention and organisational effectiveness (Heisler, 2021). Most notably, pay transparency is often positioned as a mechanism for addressing persistent pay inequities and inequalities, particularly along gender and racial lines (Bennedsen et al., 2022; Obloj & Zenger, 2022). Although empirical evidence suggests that transparency initiatives can yield positive organisational change, the literature also highlights unintended consequences, confusion and resistance, indicating that pay transparency remains a complex and context-dependent practice (Alterman et al., 2021; Brütt & Yuan, 2022).
Over the past decade, pay transparency, defined as the deliberate disclosure of pay levels, pay ranges and the criteria used to determine compensation, has gained momentum globally as a policy and organisational response to wage inequality (Bamberger, 2023; OECD, 2021). Empirical studies suggest that transparent pay systems may promote greater pay equity and, in some cases, improved productivity by clarifying reward structures and reinforcing fairness norms (Lyons & Zhang, 2023; Obloj & Zenger, 2022). However, despite this growing body of research, the influence of pay transparency on job performance remains empirically underexplored and theoretically ambiguous, with studies reporting mixed and sometimes contradictory findings (Bamberger & Belogolovsky, 2017; Cullen, 2024). Scholars note that transparency may simultaneously reduce perceptions of unfairness while intensifying social comparison processes that undermine motivation or exacerbate counterproductive competition (Gutierrez et al., 2025).
Importantly, pay transparency is not a singular or uniform practice. It involves multiple strategic decisions regarding what pay information is disclosed, why pay outcomes are determined in particular ways and how pay-related information is communicated and shared within organisations (Fulmer & Arnold, 2020; Tenhiälä et al., 2024). These decisions are particularly consequential in commission-based remuneration systems, where pay variability is high, performance pressure is continuous and earnings are closely tied to individual outputs.
Despite the expanding global literature, limited empirical attention has been given to how pay transparency shapes job performance in commission-driven industries, particularly within Global South contexts. In the South African property sector, commission-based remuneration structures are prevalent, yet compensation practices remain largely opaque. This opacity is compounded by historical wage inequalities, increasing the sensitivity surrounding pay disclosure. As a result, pay transparency may be experienced not only as a managerial practice but also as a fairness signal with significant performance implications.
Given the centrality of fairness perceptions and incentive alignment in performance-based pay systems, this study draws on Equity Theory and Agency Theory to examine how pay transparency shapes job performance in a commission-driven South African context. This study explores how pay transparency influences employee job performance within commission-driven environments in the South African property industry by examining how both employees and managers perceive pay transparency and how these perceptions shape job performance.
Literature review
Theoretical framework
Equity theory and agency theory as lenses for pay transparency
Equity theory provides a foundational lens for understanding how employees evaluate fairness in compensation systems and how these evaluations shape work-related attitudes and behaviours. The theory posits that employees assess fairness by comparing the ratio of their work inputs, such as effort, skills and performance, to the outcomes they receive, including pay and incentives, relative to referent others within the organisation (Adams, 1965). Perceived imbalances between inputs and outcomes may generate feelings of inequity, leading to reduced motivation, lower performance or withdrawal behaviours, whereas perceived equity supports sustained effort and commitment (Homans, 1974).
Pay transparency is central to these processes because it shapes employees’ ability to evaluate fairness. By clarifying how pay is distributed and on what basis, transparency enables more informed input–outcome comparisons and reduces ambiguity surrounding compensation decisions. Transparent pay practices may therefore strengthen perceptions of fairness and trust, while opaque systems can intensify perceived inequities and undermine motivation (Gutierrez et al., 2025). Empirical evidence supports this relationship, showing that transparency facilitates fairer reward evaluations and improved job satisfaction and performance, whereas restrictions on transparency foster perceptions of inequity and mistrust (Cragun et al., 2023; Godechot, 2020).
While Equity theory explains how employees evaluate fairness through social comparison processes, Agency theory addresses why organisations require transparent systems to align interests between principals and agents. Agency theory focuses on how compensation systems are used to align employee behaviour with organisational objectives, highlighting the challenge of information asymmetry in principle–agent relationships, where employees may possess more information about their effort or performance than employers, potentially leading to inefficiencies or misalignment (Eisenhardt, 1989; Jensen & Meckling, 1976). In commission-driven environments, such as the South African property industry, this asymmetry is particularly pronounced, as earnings are often tied to complex or poorly communicated performance metrics.
From an agency perspective, pay transparency functions as a governance mechanism by clarifying performance expectations, commission structures and reward criteria (Vetrivel et al., 2025), thereby reducing information asymmetry and strengthening the perceived link between effort and reward (Mabaso & Mdluli, 2025). This clarity enables employees to better align their behaviour with organisational goals and supports enhanced job performance (Asamani et al., 2025). However, Agency theory also cautions that poorly designed transparency may intensify competition or encourage short-term performance maximisation, particularly in highly competitive commission-based settings (Mabaso & Mdluli, 2025; Vetrivel et al., 2025).
Together, these theories provide a complementary framework for understanding how pay transparency shapes job performance in commission-driven contexts. Equity theory explains how transparency influences fairness perceptions and motivation through social comparison, while Agency theory explains how transparency aligns behaviour with organisational goals by reducing information asymmetry. Notably, both theories converge on transparency’s role in addressing information problems, whether framed as ambiguity that obscures fair comparison (Equity theory) or asymmetry that enables misalignment (Agency theory). In commission-driven environments, this dual mechanism is particularly critical, as employees must both perceive their compensation as equitable and understand how their efforts translate into organisational outcomes to sustain high performance.
Pay transparency in contemporary human resource management
Pay transparency has emerged as a salient HRM practice in response to increasing demands for fairness, accountability and equity in compensation systems. Broadly defined, pay transparency refers to the extent to which organisations disclose information about pay levels, pay structures and the processes used to determine compensation (Bamberger & Belogolovsky, 2017). In recent years, pay transparency has gained prominence in both academic and practitioner discourse because of its potential to influence employee attitudes, workplace relations and organisational outcomes (Alterman et al., 2021; Bussin et al., 2022).
Existing research highlights multiple motivations for adopting pay transparency practices. At a policy and governance level, transparency is frequently positioned as a mechanism to address persistent pay inequities, particularly those related to gender and race (Baker et al., 2019; Bennedsen et al., 2022; OECD, 2021). At the organisational level, transparent pay systems are associated with enhanced perceptions of fairness, trust in management and legitimacy of reward decisions (Bussin & Van Rooy, 2014; Stofberg et al., 2022b). However, the literature also cautions that pay transparency is not a universally positive intervention; its effects depend heavily on how transparency is designed, communicated and embedded within organisational contexts (Brütt & Yuan, 2022).
Scholars increasingly recognise that pay transparency is not a binary practice but exists along a continuum, ranging from limited disclosure of pay ranges to full disclosure of individual salaries and pay-setting criteria (Fulmer & Arnold, 2020). Decisions regarding what information is disclosed, why pay outcomes occur and how pay information is communicated can have differential implications for employee perceptions and behaviour (Tenhiälä et al., 2024). These distinctions are particularly relevant in performance-based remuneration systems, where pay variability is high, and rewards are closely tied to individual outputs.
Pay transparency and employee outcomes
A growing body of empirical research has examined the relationship between pay transparency and employee outcomes such as job satisfaction, organisational commitment, trust and engagement. Studies consistently demonstrate that transparent pay practices can enhance perceptions of distributive and procedural justice, which in turn support positive work attitudes (Arnold et al., 2025; Godechot, 2020). Transparency has also been linked to improved communication between employees and management, as well as greater acceptance of pay differentials when these are perceived as justified and performance-related (Gutierrez et al., 2025).
Despite these positive associations, findings regarding performance-related outcomes remain mixed. While some studies suggest that pay transparency can enhance productivity by clarifying reward criteria and motivating effort (Lyons & Zhang, 2023; Mas, 2017), others indicate that transparency may intensify social comparison, envy or perceptions of unfairness, particularly in contexts characterised by high pay dispersion (Bamberger & Belogolovsky, 2017; Cullen, 2024). These competing findings suggest that pay transparency may simultaneously motivate and demotivate employees, depending on how it is experienced and interpreted.
Importantly, much of the existing literature has focused on pay transparency in fixed-pay or executive compensation contexts, with comparatively limited attention given to commission-driven environments. In such settings, performance pressure, income volatility and competition among employees may amplify both the positive and negative effects of transparency. As a result, the relationship between pay transparency and job performance remains empirically underexplored, particularly outside of Global North contexts.
Pay transparency in commission-driven and global south contexts
In commission-driven industries, such as property and real estate, compensation systems are inherently variable and closely tied to individual performance outcomes. While these systems are intended to incentivise effort and productivity, they often lack transparency regarding performance metrics, commission calculations and reward thresholds. Research suggests that opaque commission structures can generate confusion, mistrust and perceptions of inequity, undermining the motivational intent of performance-based pay (Mabaso & Mdluli, 2025; Vetrivel et al., 2025).
Within Global South contexts, pay transparency practices are further shaped by institutional, historical and socio-economic factors. In South Africa, historical wage inequalities and persistent income disparities heighten the sensitivity surrounding pay disclosure and fairness perceptions. Limited empirical research has examined how employees and managers in such contexts experience pay transparency, particularly in sectors where commission-based remuneration is prevalent. This represents a notable gap in literature, as most existing studies are situated in developed economies with different labour market dynamics and regulatory frameworks.
Employee dissatisfaction, misplaced perceptions of pay equity and misinterpretation of pay differences
Despite its potential benefits, pay transparency presents notable challenges that may undermine employee attitudes and organisational outcomes when poorly designed or communicated. One significant concern is that revealing pay disparities can generate employee dissatisfaction and workplace tension, particularly when differences are not perceived as legitimate or fair. Research indicates that transparency may expose salary gaps, leading to disengagement, reduced morale and increased turnover if employees perceive disparities as unjustified (Balkin & Werner, 2023). For example, Quintanar (2022) found that the implementation of pay transparency in a media corporation resulted in a 10% increase in employee turnover, as lower-paid employees became demotivated after comparing their earnings with those of higher-paid colleagues. Similarly, Abdulsalam et al. (2021) reported that the disclosure of individualised pay arrangements generated resentment among lower-level employees, negatively affecting organisational morale.
Pay transparency can also disrupt perceptions of pay equity by amplifying employees’ scrutiny of how compensation decisions are made. When transparency is not accompanied by clear justification, employees may attribute pay differences to non-meritocratic factors such as favouritism or bias (Arshad, 2025). Neale et al. (2021), in a case study of a Fortune 500 organisation, found that employee beliefs that wage inequalities were driven by favouritism led to a 15% decline in job satisfaction. Similarly, Godsey (2025) demonstrated that organisations failing to adequately explain pay gaps experienced heightened internal conflict and lower productivity, underscoring the importance of procedural clarity alongside disclosure.
A further challenge associated with pay transparency is the risk of misinterpreting pay differences when information is disclosed without sufficient context. Without clear explanations regarding performance criteria, experience, role complexity or market-related factors, employees may perceive legitimate pay variations as unfair or discriminatory (Dust et al., 2021). Rosen et al. (2021), in a study of the construction sector, found that inadequately explained pay disparities were associated with a 12% increase in absenteeism, driven by employee resentment. Likewise, Brütt and Yuan (2022) reported that employees in technology start-ups frequently misinterpreted broad salary ranges as evidence of bias rather than market-based considerations, eroding trust in management and weakening organisational cohesion.
Collectively, these findings highlight that pay transparency is not inherently beneficial and may produce adverse outcomes if not accompanied by effective communication, credible justification and supportive organisational practices. These challenges are particularly salient in commission-driven environments, where pay dispersion is high and performance pressures are intense, reinforcing the need for context-sensitive approaches to transparency.
The reviewed literature demonstrates that pay transparency is a complex and context-dependent HRM practice with significant implications for fairness perceptions, trust and employee behaviour. While prior research has established links between pay transparency and justice-related outcomes, evidence regarding its influence on job performance, especially in commission-driven environments, remains inconclusive. Moreover, limited attention has been given to how pay transparency is experienced within Global South contexts characterised by historical inequality and high pay dispersion.
Addressing these gaps, the present study adopts a qualitative approach to explore how employees and managers in the South African property industry perceive pay transparency and how these perceptions shape job performance. By integrating insights from Equity theory and Agency theory, the study seeks to deepen understanding of the mechanisms through which pay transparency operates in commission-driven organisational settings.
Research design
The current study employed a qualitative research design grounded in an interpretivist paradigm (Saunders et al., 2023). Interpretivism assumes that social reality is socially constructed and best understood through individuals’ meanings and interpretations, making it well suited to exploring how employees and managers perceive pay transparency and its implications for job performance (Cohen et al., 2018). A qualitative approach enabled an in-depth examination of participants’ lived experiences and sense-making processes within a commission-driven organisational context (Creswell & Poth, 2018).
Research context
The study was conducted within the South African property industry, a sector characterised by commission-based remuneration structures and high-income variability. This context is particularly relevant given the sensitivity surrounding compensation practices and the persistence of historical wage inequalities within the South African labour market. Mouton (2011) emphasises the value of industry-specific contexts for generating applied knowledge, noting that research situated in real-world organisational settings can inform practical, policy-relevant interventions. Accordingly, the property sector provided a suitable context for examining pay transparency as both a managerial practice and an employee experience. The findings should be interpreted within relatively structured Real Estate Investment Trust (REIT) environments. In smaller, less formalised, or technologically distinct organisations, transparency mechanisms may operate differently because of variations in governance structures, resource availability and performance monitoring systems.
Participants and sampling
Participants were selected using purposive sampling (Saunders et al., 2023) to ensure inclusion of individuals with direct experience of commission-based remuneration and pay transparency practices. The sample comprised both employees and managers to capture multiple perspectives on compensation practices and performance dynamics, thereby enhancing the depth and credibility of the findings (Creswell & Poth, 2018). Inclusion criteria required participants to be employed within the South African property industry and to have direct exposure to commission-driven pay structures. Sampling continued until data saturation was reached, as indicated by the recurrence of themes and the absence of new insights that were substantively different. Saturation was operationalised inductively during the reflexive thematic analysis: once successive interviews consistently yielded recurring codes without generating substantively new categories, data collection was deemed sufficient (Braun & Clarke, 2021). A sample of 15 participants across three organisations is consistent with established norms for qualitative case study research in management and HRM (Guest et al., 2006; Saunders et al., 2023). The homogeneity of the three REITs studied, in terms of firm type, size and sector, represents a deliberate boundary condition that enables contextual richness. Future research should examine whether firm size, age, ownership structure and technological orientation moderate the relationship between pay transparency and job performance.
Data collection
Data were collected through semi-structured interviews, which allowed flexibility to probe participants’ experiences while ensuring consistency across interviews. Semi-structured interviews are particularly appropriate for qualitative research as they enable participants to articulate their perceptions and experiences in their own words while remaining aligned with the research objectives (Creswell & Creswell, 2018). This method facilitated rich, detailed accounts of how pay transparency was understood and experienced in practice within the organisational context.
Data analysis
Interview data were analysed using thematic analysis, following a systematic process of familiarisation, coding and theme development (Braun & Clarke, 2021). This approach was appropriate for identifying common and divergent patterns of meaning related to fairness perceptions, incentive alignment and job performance within an interpretivist framework. Babbie and Mouton (2018) endorse thematic analysis for South African qualitative studies because of its suitability for exploring context-specific organisational phenomena. The method enabled the systematic generation of insights and supported the achievement of the study’s research objectives (Yam et al., 2023).
Trustworthiness
Trustworthiness was ensured in accordance with the criteria proposed by Lincoln and Guba (1985), namely credibility, dependability, confirmability and transferability. Credibility was enhanced through the use of semi-structured interviews that allowed participants to provide rich, detailed accounts of their experiences, as well as the inclusion of verbatim quotations to ground interpretations in participants’ voices. Dependability was supported through transparent documentation of the research process, including data collection procedures and analytic decisions. Confirmability was addressed by maintaining an audit trail and engaging in reflexive consideration to minimise researcher bias and ensure that findings were derived from the data rather than preconceived assumptions. Transferability was facilitated by providing thick descriptions of the research context, participants and commission-driven remuneration environment, enabling readers to assess the applicability of the findings to similar organisational settings.
Reflexivity
Reflexivity is central to credible qualitative inquiry (Braun & Clarke, 2021). The researchers acknowledge prior familiarity with the South African property industry and a theoretical orientation towards equity-based frameworks, both of which may have shaped the interpretation of interview data. To manage these influences, several strategies were employed: (1) a semi-structured interview guide was used to maintain consistency across participant encounters and reduce interviewer-led responses; (2) a reflexive journal was maintained throughout data collection and analysis to document analytic decisions and surface assumptions; (3) reflexive thematic analysis (Braun & Clarke, 2021) was adopted, which foregrounds the researcher’s active role in theme construction rather than claiming data-driven objectivity and (4) peer debriefing was conducted to subject emerging interpretations to external scrutiny. The findings represent interpretations co-constructed between the researchers and participants, consistent with interpretivist epistemology.
Ethical considerations
Ethical clearance to conduct this study was obtained from the Department of Industrial Psychology and People Management, University of Johannesburg Research Ethics Committee (Ref. No. IPPM-2025-934[M]).
Results
The coding and thematic analysis revealed five interrelated themes that reflect how pay transparency influences performance, motivation and regulation within a commission-based property environment. These themes were derived from recurring patterns across employee and managerial accounts. Table 1 illustrates the progression from first-order verbatim statements to second-order categories and aggregate themes. In contrast, Table 2 provides a comparative synthesis of employee and manager perspectives across the five themes.
| TABLE 2: Comparison of employee and manager perspectives. |
Theme 1: Pay transparency as a performance signal
Participants consistently described pay transparency as a critical signal that clarified performance expectations and directed effort within the commission-based property environment. Employees explained that transparent commission structures reduced uncertainty surrounding how performance translated into rewards, allowing them to focus their energy on achieving clearly defined targets rather than speculating about pay outcomes. One employee articulated this clarity succinctly:
‘When the targets and bonus rules are clear, you don’t second-guess yourself. You know exactly what you’re working towards.’ (Employee, E7, male, director)
For employees, transparency functioned as a motivational anchor, providing certainty about what constituted successful performance and reinforcing a sense of control over income outcomes. This clarity reduced anxiety and cognitive distraction, enabling sustained effort and goal-directed behaviour. Managers similarly emphasised pay transparency as a mechanism for aligning individual effort with organisational priorities. From their perspective, transparent commission rules provided a structured framework through which performance expectations could be communicated and reinforced:
‘People perform better when they understand how bonuses are calculated. It gives direction to their effort.’ (Manager, M2, male, regional manager)
While employees experienced transparency primarily as motivational clarity, managers framed it as a performance management tool that translated organisational objectives into measurable, incentivised behaviours. Despite these different emphases, both groups converged on the view that transparency strengthened performance focus by reducing ambiguity, aligning expectations and reinforcing the link between effort and reward.
Theme 2: Performance decline under pay secrecy
In contrast, opaque pay systems were consistently associated with reduced discretionary effort, disengagement and frustration. Employees described pay secrecy as demotivating, particularly when they could not see how additional effort translated into tangible rewards. This uncertainty prompted questioning whether extra effort was worthwhile:
‘You start asking why you should go the extra mile when you don’t know how rewards are decided.’ (Employee, E4, female, leasing agent)
Employees interpreted secrecy as a signal that reward decisions might be arbitrary or biased, leading to withdrawal behaviours such as reduced effort or minimal compliance. These responses reflected attempts to protect oneself from perceived unfairness. Managers echoed these concerns but focused more strongly on the collective impact of secrecy on team dynamics and performance stability:
‘Secrecy creates tension. People disengage because they assume the system is unfair.’ (Manager, M1, male, regional manager)
From a managerial standpoint, secrecy erodes trust, fosters suspicion and disrupts collaboration, ultimately undermining team cohesion and consistent performance. While employees primarily experienced secrecy as personal unfairness, managers emphasised its broader organisational consequences, including lowered morale, strained relationships and instability across commission-driven teams.
Theme 3: Transparency enables self-regulation
Pay transparency was also described as enabling self-regulation and reducing reliance on managerial oversight. Employees reported that understanding how pay structures operated encouraged them to monitor their own performance more closely and take responsibility for outcomes. One employee explained:
‘I track my performance more closely when I know how pay works. It’s on me.’ (Employee, E10, female, property manager)
For employees, transparency promoted a sense of ownership over performance, reinforcing personal accountability and proactive behaviour. Rather than waiting for managerial feedback or intervention, employees adjusted their effort and strategies based on clear pay-performance signals. Managers reinforced this perspective, emphasising that transparency reduced the need for constant supervision and micromanagement:
‘People manage themselves better when they understand the system.’ (Manager, M3, female, COO)
Managers viewed transparency as a mechanism that shifted responsibility downward, allowing them to focus on strategic oversight rather than continuous monitoring. Employees experienced self-regulation as empowerment and accountability, whereas managers interpreted it as a practical efficiency that enhanced performance management in commission-driven environments.
Theme 4: Fairness, equity and morale
Participants consistently link pay transparency to perceptions of fairness and morale, particularly through processes of social comparison. Employees expressed frustration and demoralisation when differences in earnings were not explained or justified:
‘When others earn more without explanation, it kills morale.’ (Employee, E8, female, property manager)
For employees, unexplained pay differences have triggered feelings of inequity, undermining motivation and emotional commitment to the organisation. Transparency was therefore viewed as essential for sustaining morale in competitive commission contexts. Managers acknowledged this challenge and emphasised transparency as a preventative strategy for managing equity perceptions, even where pay differentials were legitimate:
‘We need transparency to manage perceptions of fairness, even if pay differs.’ (Manager, M7, male, director)
Managers recognised that transparency did not require identical pay outcomes but a relatively clear justification for differences. Employees focused on the emotional and motivational consequences of perceived inequity. At the same time, managers framed transparency as a proactive mechanism to mitigate dissatisfaction, reduce conflict and sustain morale within competitive remuneration structures.
Theme 5: Organisational trust and stability
Finally, pay transparency was described as strengthening organisational trust, psychological safety and stability. Employees noted that transparency reduced speculation, gossip and interpersonal tension associated with unclear pay practices:
‘Transparency lowers gossip and tension because there’s less to guess about.’ (Employee, E9, female, property manager)
For employees, transparency provided emotional reassurance and reduced uncertainty, contributing to a more psychologically safe work environment. Managers highlighted the organisational benefits of transparency, particularly its role in reducing disputes and ensuring consistency in reward allocation:
‘Clear pay rules reduce arguments and create stability.’ (Manager, M6, male, property manager)
Managers viewed transparency as an organisational control mechanism that supported smoother operations, reduced conflict and reinforced consistent performance standards. While employees experienced transparency primarily as reassurance and trust building, managers interpreted it as a stabilising governance tool that supported long-term organisational effectiveness.
Across all five themes, pay transparency emerged as a multifaceted mechanism shaping motivation, effort, fairness perceptions, self-regulation and trust. Employees consistently emphasised clarity, emotional responses, and motivation, while managers focused on alignment, efficiency and stability. Together, these findings demonstrate that pay transparency plays a central role in sustaining performance and organisational functioning in commission-based environments.
Discussion
The findings demonstrate that pay transparency operates as a performance lever by reducing uncertainty and enabling behavioural alignment. Extending Equity theory, the study indicates that fairness perceptions in commission-based roles are more influenced by procedural clarity than by absolute pay levels. From an Agency theory perspective, transparency reduces information asymmetry, strengthening goal alignment. This study examined how pay transparency shapes job performance within commission-driven environments in the South African property industry. Responding to calls in the literature for greater empirical clarity regarding the performance consequences of pay transparency, particularly in commission-based and Global South contexts (Bamberger & Belogolovsky, 2017; Cullen, 2024; Gutierrez et al., 2025), the findings reveal that pay transparency functions as a powerful yet complex organisational mechanism. Rather than operating as a uniformly positive or negative practice, transparency influenced performance through interrelated pathways involving motivational clarity, self-regulation, fairness perceptions, trust and organisational stability.
Consistent with contemporary HRM literature, pay transparency was experienced not merely as the disclosure of pay information but as a signal communicating organisational values, expectations and fairness norms (Alterman et al., 2021; Fulmer & Arnold, 2020). Within a commission-driven context characterised by income volatility and sustained performance pressure, these signals carried heightened significance. Employees described transparent commission structures as clarifying the effort–reward relationship and providing direction for performance, enabling them to focus their energy on achieving clearly defined targets rather than speculating about pay outcomes. This supports prior research suggesting that transparency strengthens motivational alignment by reducing ambiguity and reinforcing performance expectations (Colella et al., 2007; Lyons & Zhang, 2023; Mas, 2017).
These findings extend existing scholarship by demonstrating that, in commission-based environments, pay transparency operates primarily as a performance signal rather than solely as a fairness intervention. Drawing on Agency theory, transparent commission rules reduced information asymmetry by clarifying how individual effort translated into financial outcomes (Eisenhardt, 1989; Jensen & Meckling, 1976). Employees were consequently better able to align their behaviour with organisational objectives, while managers relied less on direct supervision to enforce performance standards. This supports emerging arguments that transparency can function as a governance mechanism, embedding behavioural control directly within reward systems (Vetrivel et al., 2025).
In contrast, pay secrecy was consistently associated with reduced discretionary effort, disengagement and withdrawal behaviours. Employees interpreted opaque pay systems as signals that reward decisions might be arbitrary, biased or influenced by favouritism, leading them to question the value of additional effort. These reactions align closely with Equity theory, which posits that employees require sufficient information to evaluate the fairness of their input–outcome ratios relative to others (Adams, 1965; Homans, 1974). When transparency was absent, employees were unable to make informed social comparisons, intensifying perceptions of inequity and undermining motivation. This finding is consistent with empirical evidence demonstrating that restricted transparency fosters mistrust, dissatisfaction and disengagement (Cragun et al., 2023; Godechot, 2020).
From a managerial perspective, pay secrecy was associated with broader organisational consequences, including tension, instability and declining team cohesion. Managers emphasised that opaque pay practices disrupted collaboration and undermined consistent performance across teams, reinforcing earlier findings that secrecy weakens not only individual motivation but also collective performance and organisational effectiveness (Heisler, 2021; Moriarty, 2018).
A significant contribution of this study lies in demonstrating how pay transparency enables employee self-regulation in commission-driven environments. Employees reported that they monitored their own performance more closely when commission rules were clearly understood, adjusting their strategies proactively rather than relying on managerial feedback. This finding extends the pay transparency literature by highlighting self-regulation as a key behavioural mechanism linking transparency to performance. From an Agency theory perspective, transparency reduced information asymmetry and shifted responsibility for performance management downward, enabling employees to internalise performance controls (Asamani et al., 2025). Managers, in turn, experienced transparency as an efficiency-enhancing mechanism that reduced the need for micromanagement. In high-pressure, performance-based systems, transparency thus appears to substitute for continuous supervision by embedding behavioural guidance directly into pay structures.
The findings further highlight the importance of fairness perceptions in maintaining morale, particularly within a historically unequal context. Employees did not expect identical pay outcomes but rather clear justification for differences. When pay disparities were unexplained, morale declined and motivation eroded, confirming concerns raised in the literature that transparency without justification may intensify social comparison and dissatisfaction (Balkin & Werner, 2023; Dust et al., 2021). These dynamics were especially pronounced within the South African context, where historical wage inequalities along racial and gender lines have heightened sensitivity to fairness cues. Transparency, therefore, functioned not only as a managerial practice but also as a symbolic signal of equity, legitimacy and organisational integrity. This finding extends international literature by demonstrating how pay transparency carries heightened moral and historical significance in Global South contexts marked by structural inequality (Roberts & Tran, 2023).
Pay transparency also played a critical role in shaping organisational trust, psychological safety and stability. Employees described transparency as reducing gossip, speculation and interpersonal tension, contributing to a more predictable and psychologically safe work environment. These outcomes align with Social Exchange Theory, which emphasises that fair and transparent treatment fosters reciprocal trust and commitment (Cropanzano et al., 2020). Managers framed transparency as a stabilising governance mechanism that reduced disputes and ensured consistency in reward allocation. Importantly, the findings confirm earlier warnings that transparency alone is insufficient; trust depended heavily on how pay information was communicated and justified (Brütt & Yuan, 2022; Nguyen et al., 2022). Where transparency was accompanied by clear explanation and credible leadership communication, it strengthened trust and performance; where it was absent or poorly communicated, it undermined both.
Taken together, these findings directly address the theoretical ambiguity in the literature regarding the performance effects of pay transparency (Bamberger & Belogolovsky, 2017; Cullen, 2024). By integrating Equity theory and Agency theory, the study demonstrates that pay transparency operates through dual mechanisms: enabling fair social comparison while simultaneously aligning employee behaviour with organisational goals. Both mechanisms hinge on reducing information problems, whether framed as ambiguity obscuring fairness or asymmetry undermining alignment. Crucially, the findings show that pay transparency is neither inherently beneficial nor harmful. Its performance effects are contingent on procedural clarity, justification, leadership communication and contextual sensitivity.
By focusing on a commission-driven property context within South Africa, this study addresses a significant gap in the pay transparency literature, which the Global North and fixed-pay settings have dominated. The findings demonstrate that pay transparency serves as a performance signal, a governance mechanism and a fairness cue, with its effects shaped by historical inequality and the institutional context. In doing so, the study advances a more distinct and context-sensitive understanding of pay transparency and its role in shaping job performance in commission-based environments.
Practical implications
The findings of this study suggest that pay transparency should be approached as a strategic performance management practice rather than a narrow compliance or disclosure exercise. Organisations operating in commission-driven environments should prioritise transparency in pay criteria and processes, rather than focusing solely on pay outcomes. Clear articulation of how commissions are calculated, which performance indicators are rewarded, and how targets are evaluated enables employees to align effort with organisational expectations and reduces uncertainty surrounding income outcomes.
Pay transparency should also be deliberately integrated into broader performance management systems. Transparent commission structures can reinforce goal clarity, support self-regulation and reduce reliance on continuous managerial oversight by embedding performance signals directly into reward mechanisms. When performance metrics and reward criteria are consistently communicated and aligned with organisational objectives, transparency functions as both a motivational anchor and a governance mechanism.
Furthermore, the effectiveness of pay transparency depends heavily on leadership capability. Organisations should equip line managers and senior leaders with the skills required to communicate pay decisions clearly, consistently and empathetically. Leaders play a critical role in explaining pay differentials, contextualising performance outcomes and legitimising reward decisions. Without credible and emotionally intelligent communication, transparency initiatives risk intensifying perceptions of inequity and undermining trust rather than enhancing performance.
Limitations and future research
Several limitations of the study should be acknowledged. Initially, the qualitative, interpretivist design and the sector-specific focus on the South African property industry limit the generalisability of the findings. While the study provides rich, contextual insight into how pay transparency is experienced in commission-driven environments, the findings may not be directly transferable to other industries or remuneration systems.
A further limitation relates to the reliance on self-reported performance data. Participants’ accounts of their performance improvements under conditions of pay transparency could not be independently verified against objective organisational records, such as commission earnings, performance appraisal ratings or sales output metrics. These accounts may therefore be subject to social desirability bias, retrospective sense-making, and self-serving attribution. Accordingly, the findings should be interpreted as evidence of perceived performance effects rather than objectively verified behavioural outcomes.
In addition, the relative homogeneity of the sample, comprising established, institutionally structured REITs within the student accommodation sector, represents a deliberate boundary condition that enhances contextual depth but limits variability. Organisational characteristics such as firm size, age, ownership structure and technological orientation may shape how pay transparency is implemented and experienced. As such, the findings may not fully capture the dynamics present in smaller, newer or more technologically driven firms, where governance structures and pay systems may differ substantially.
Future research should extend this work by employing mixed-methods or quantitative designs to test the mechanisms identified in this study, including motivational clarity, self-regulation and fairness perceptions, across larger and more diverse samples and commission-driven sectors such as financial services, sales and insurance. Longitudinal research would further strengthen understanding by examining how the effects of pay transparency evolve over time, particularly following the implementation of transparency initiatives. Expanding research into other Global South contexts would deepen understanding of how historical inequality and institutional conditions shape transparency outcomes. Additionally, future comparative studies across firm types, such as new versus established organisations, large versus small firms and manual versus technology-driven environments, would provide deeper insight into how organisational characteristics moderate the relationship between pay transparency and job performance. Incorporating objective performance indicators alongside qualitative accounts would also enhance the robustness of findings and strengthen causal inference.
Conclusion
This study demonstrates that pay transparency, when implemented with procedural clarity and credible communication, enhances job performance in commission-driven contexts. Rather than functioning as a neutral disclosure practice, pay transparency operates as a performance signal shaped by employees’ fairness perceptions, influencing motivation, behavioural alignment and organisational trust. Its effects, however, depend on how transparency is designed and communicated. When transparency lacks adequate justification, it may intensify social comparison processes and undermine morale. Conversely, when implemented effectively, it strengthens performance focus and organisational stability. By integrating Equity theory and Agency theory, the study shows that pay transparency simultaneously addresses fairness evaluation needs and performance alignment challenges inherent in commission-based work. These findings advance a more context-sensitive understanding of pay transparency as a strategic HRM practice, with particular relevance for Global South environments characterised by structural inequality and historically embedded wage disparities. This study makes three interrelated contributions to scholarship. Firstly, it demonstrates that pay transparency operates as a performance signal, a governance mechanism and a fairness cue, with each function carrying heightened significance in Global South contexts shaped by historical wage inequality. Secondly, by integrating Equity theory and Agency theory, it provides a unified theoretical account of how transparency simultaneously addresses information ambiguity (which obscures fair social comparison) and information asymmetry (which enables misalignment between effort and reward). Thirdly, it identifies self-regulation as a previously undertheorised behavioural mechanism linking transparent pay structures to sustained individual performance in commission-driven environments. Taken together, these contributions advance a context-sensitive, theoretically integrated understanding of pay transparency that moves decisively beyond binary assessments of its benefits or risks.
Acknowledgements
This article is based on research originally conducted as part of Vhafuniwa B. Thagwana’s Master of Commerce in Human Resource Management dissertation titled ‘The effects of pay transparency on employees’ job performance in the South African property industry’, submitted to the College of Business and Economics, University of Johannesburg, 2026. The thesis is currently unpublished and not publicly available. The dissertation was supervised by Calvin Mabaso and Mark Bussin. The dissertation was reworked, revised and adapted into a journal article for publication. The author confirms that the content has not been previously published or disseminated and that it complies with the ethical standards for original publication.
Competing interests
The authors declare that they have no financial or personal relationships that may have inappropriately influenced them in writing this article. The author, Calvin Mabaso, serves as an editorial board member of this journal. The peer review process for this submission was handled independently, and the author had no involvement in the editorial decision-making process for this article. The authors have no other competing interests to declare.
CRediT authorship contribution
Calvin Mabaso: Conceptualisation, Formal analysis, Methodology, Resources, Visualisation, Writing – original draft, Writing – review & editing. Vhafuniwa B. Thagwana: Conceptualisation, Data curation. Mark Bussin: Supervision. All authors reviewed the article, contributed to the discussion of results, approved the final version for submission and publication, and take responsibility for the integrity of its findings.
Funding information
The authors received no financial support for the research, authorship and/or publication of this article.
Data availability
The data that support the findings of this study are available from the corresponding author, Calvin Mabaso, upon reasonable request.
Disclaimer
The views and opinions expressed in this article are those of the authors and are the product of professional research. They do not necessarily reflect the official policy or position of any affiliated institution, funder, agency or that of the publisher. The authors are responsible for this article’s results, findings and content.
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