The occurrence of demotions regarding job level, salary and job authority
| DOI | https://doi.org/10.1108/PR-06-2014-0139 |
| Published date | 05 September 2016 |
| Date | 05 September 2016 |
| Pages | 1217-1239 |
| Author | Tanja Verheyen,Nick Deschacht,Marie-Anne Guerry |
| Subject Matter | HR & organizational behaviour,Global HRM |
The occurrence of demotions
regarding job level, salary
and job authority
Tanja Verheyen
Department of Business, Technology and Operations,
Vrije Universiteit Brussel, Brussels, Belgium
Nick Deschacht
Faculty of Economics and Business, KU Leuven,
Brussels, Belgium, and
Marie-Anne Guerry
Department of Business, Technology and Operations,
Vrije Universiteit Brussel, Brussels, Belgium
Abstract
Purpose –The purpose of this paper is to determine the occurrence of job level, salary and job
authority demotions in the workplace through the analysis of Belgian Statistics on Income and Living
Conditions (SILC)-data of 2007-2011.
Design/methodology/approach –Three hypothesesare tested: H1: there is a genderinequality in job
authority demotions. H2: the level of educationand the probability of being subjectto a job level, salary
or job authority demotion are negatively correlated. H3: age is negatively correlated with job level,
salary or job authority demotion probabilities. The cross-sectional data of the SILC cover a specific time
periodwith data on inter alialiving conditions.The longitudinaldata give informationon inter aliaincome
and non-monetary variables over a period of four years. The authors estimate multivariate regression
models for binary demotion variables. These analyses allow the authors to estimate the odds of being
demoted. The authors discuss the demotion rates, th e bivariate correlations and the regression analysis.
Findings –The data analysisresult in the fact that base salarydemotions are not commonly appliedas
literature and the Belgian law on salary protection endorses. Fringe benefits demotions, as for instance
the abolitionof a company car or a bonus are, however,more frequent. There is a gendergap with regard
to job authoritydemotion. Highly educatedrespondents are less confrontedwith job authority demotions.
Age is negativelycorrelated with base salary/fringebenefits or job authority demotionprobabilities, but
not with job-level demotions. H1 is thus confirmed. H2 and H3 only partlyconfirmed.
Research limitations/implications –Several analyses were restricted because the EU-SILC did not
question all dimensions of demotion in detail.
Originality/value –This study contributes to the scarce literature on demotion and to empirical
studies on demotions regarding job level, salary and job authority.
Keywords Careers, Human resource management, Downsizing, Quantitative
Paper type Research paper
1. Introduction
Mergers and acquisitions, the flattening of organizations, the consecutive technological
revolutions, etc. all put pressure on organizations and their employees. These bring
fundamental changes in the workplace and lead to career mobility (Maslach and Leiter,
2008). This mobility can be upward, lateral or downward (Arthur et al., 2005; Wis e and
Millward, 2005).
Careers have also changed dramatically over time and evolved to an intelligent,
flexible career (Baruch, 2004, 2006), where career transitions, such as demotion, are an
Personnel Review
Vol. 45 No. 6, 2016
pp. 1217-1239
©Emerald Group Publis hing Limited
0048-3486
DOI 10.1108/PR-06-2014-0139
Received 26 June 2014
Revised 23 May 2015
17 August 2015
2 December 2015
Accepted 1 February 2016
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0048-3486.htm
1217
Job level,
salary and job
authority
integral part of careers (Sullivan and Arthur, 2006; Krieshok et al., 2009). These changes
in society, in the workplace and in our careers underline the importance of studying
downward job mobility.
Demotion, as well as promotion or lateral transition, is an important practice in the
strategic HR-policy of an organization (Hall and Isabella, 1985). Demotion helps,
for example, putting the right person in the right place within the organization (Carson
and Carson, 2007; Greenhaus et al., 2010; Miner and Miner, 1973). Demotion can be an
interesting opportunity for employees too, for example over 55s can extend their
working lives on a voluntary base by choosing for a less demanding, lighter job, with
fewer responsibilities and less job pressure (Burtless and Quinn, 2002; Rappaport,
Bancroft and Okum, 2003; Remmery et al., 2003). Notwithstanding these utilities,
researchers indicate that the empirical research on demotion has received little
attention (Carson and Carson, 2007; Hall and Isabella, 1985; Kohl and Steph ens, 1990;
More, 1962; Sargent, 2003).
Demotion is a downward transition (Hall and Isabella, 1985) towards a lower job
level (Carson and Carson, 2007; Golembiewski, 1982; Lima and Pereira, 2003) whether
or not there is a decrease in salary (Hall and Isabella, 1985; Mulders et al., 2015; Ng et al.,
2007; Remmery et al., 2003) and/or a decrease in job authority (Carson and Carson, 2007;
Hall and Isabella, 1985; Lyons et al., 2012; Ng et al., 2007; Veiga, 1981). Demotion may
relate to various stakeholders: an employee can choose to demote to bring the
relationship between work and life into balance (Verheyen and Vermeir, 2011) and an
employer can decide to demote in order to optimize the organization (Carson and
Carson, 2007; Ng et al., 2007).
The above definition of demotion already suggests that a demotion could include a
decrease in job level, salary and/or job authority. Hence, demotion is not an
unambiguous concept; it includes a variety of dimensions and has different meaning s
(Verheyen and Guerry, 2014a). Yet, job level, salary and job authority repr esent three
key dimensions within demotion literature. Therefore it is appropriate to study three
kinds of demotions, namely, job level, salary and job authority demotions.
The probability of a decrease in job level, salary and/or job authority is not equal
for all employees and depends on age, gender and education level (Becker, 2008; Kooij
et al., 2013; Langowitz et al., 2013; Rosenfeld et al., 1998; Schultz, 1987).
The current paper aims to investigate the occurrence of job level, salary and job
authority demotions in the workplace. This occurrence is studied for the Belgian labor
market by analyzing EU-Statistics on Income and Living Conditions (SILC)-data of
2007-2011. It is relevant to study the Belgian labor market because at present, some
societal trends are stimulating Belgian organizations to consider demotion as an
HR-policy. First, the participation of older workers in employment is in Belgium, as in
other European countries, very low. To stimulate Belgian organizations to keep their
over-45s and to extend their careers, the program act of the Belgian Government
prescribes some measures, such as the use of internal transitions. Second, according to
Maslach and Leiter (2008) fundamental changes in the workplace and in the nature of
our jobs cause work-related health problems, such as burnout. As a result of burnout,
employees tend to work with adjusted job content (Baruch-Feldman et al., 2002; Janssen
et al., 2003). In practice this often means a demotion. Since September 2014 the Belgian
Government had a law on burnout which obliges Belgian companies to take specific
measures. In what follows we first examine the importance of job level, salary an d job
authority within economics theories. Then we study the importance of age, gender and
education within career literature, as they relate to job level, salary and job authority
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