Publication Date

Fall 2020

Degree Type


Degree Name

Master of Science (MS)




Howard Tokunaga


Compensation, POS, Tenure

Subject Areas

Psychology; Organizational behavior


Compensation is a crucial tool utilized by companies to help attract, retain, and motivate employees. However, previous research has overlooked the ways in which compensation might add value to important employee outcomes such as engagement and organizational tenure. Therefore, this present study aimed to close this gap by examining the relationship between pay level and engagement, as well as pay level and organizational tenure. It was hypothesized that higher pay levels would increase the engagement dimensions of dedication, vigor, and absorption in an employee, and that higher pay levels would increase organizational tenure in an individual. It also sought to examine the moderating variable of perceived organizational support in both relationships. A total of 71 participants from a variety of organizations participated in the study. Results indicated that there was a positive relationship between pay level and absorption, such that higher pay levels increased amount of absorption. However, the other hypotheses were not supported. Additionally, no moderating effect of perceived organizational support was found in either relationship. The results of this study suggest that further research is needed to assess how influential compensation is as a predictor of positive organizational outcomes.