Organizational Relationships, Pay & the Wage-Gap


By Kevin Clark, PhD, Villanova School of Business, Patrick Maggitti, PhD, Villanova School of Business and Holly Slay, PhD, Seattle University


The wage gap between women and men remains a persistent fact of life in the U.S. According to the Census Bureau, full-time women over the age of 25 earn 24% less than men. The gap is particularly large for women with advanced degrees, at 31 percent.

Numerous lawsuits brought by women against prominent companies such as Wal-Mart, Boeing, and Costco and personal accounts of many women suggest that discrimination exists. While society may slowly be moving toward equal pay for women, researchers have begun to look for ways individual women can increase their pay in the near-term. For example, developing skills for negotiating assertively can pay dividends in performance and salary reviews.

In a recent study of the link between work-place relationships and pay, we found another opportunity in which individual managers – particularly women – may have an opportunity to increase pay.


In a survey of 315 white-collar professionals recently enrolled in an M.B.A. program here at the Villanova School of Business and another school, while controlling for years of work experience, position, industry and initial starting salary, we found that certain types of relationships managers had with their peers and bosses had an impact on pay. No surprise. Interestingly, however, relationships with subordinates had an even bigger impact. This finding runs counter to common wisdom in which those that are tight with the boss receive the highest rewards.

Our findings apply to both men and women, however, further analysis of our data showed that the relationship of the women in our study were significantly less effective than the men. In other words, while benefits exists for both men and women, women appear have more opportunity to increase their pay by more effectively managing their relationships.

In all, we found 7 types of relationship characteristics that can influence pay and in which women trail men:

With respect to subordinates, it is important to be close with them, have the ability to gather information from them, and to develop the ability to influence them. With peers, it is important to be able to utilize them for information. Finally, with bosses, there is a benefit to being close, having an ability to influence them, and being willing to initiate contact with them. Overall, these results lead to the following advice:

• Get to know your team. Don’t be afraid to develop close professional relationships with them and be sure to give heed to their thoughts and opinions
• Look to other managers at your same level for information about what is going on in your company. This increased awareness may prove valuable to your decision-making.
• Plan to have something of value to say should you have a chance encounter with the boss. Your ability to initiate meaningful conversations will help you enhance perceptions of your value.

At some level, our findings are intuitive – managers are often evaluated on the performance of tasks, many of which are actually performed by subordinates. Still it is interesting to note the direct impact on pay. Indeed, in our research, managers underestimated the role subordinates play in career success and tended to over emphasize the relationship with the boss. This is not to say relationships with the boss aren’t important, however.

Developing the type of relationship in which you have an influence and where you are able to initiate contact matters greatly.  To be clear, we are not advocating gratuitous and insincere behavior – we do find that managers who are able to wiled upward influence and who are more proactive with their boss achieve better career results.  The danger we detected in the research was that an overemphasis on the boss tended to be coupled with less attention and regard for subordinates and this was clearly a mistake many managers were making.

In summary, we again emphasize our belief that discrimination persists in our society. While we believe more effective relationship management provides an opportunity for women to lessen the gap, we do not believe it will erase it completely. Still, we are hopeful women managers can find our study helpful on an individual basis as they work to develop their networks for career success.