Chapter 2

Review of Related Literature

This chapter will present the review of related literature from books, journals, and other

references.

Salary Gratification

According to Gaol (2014) salary is a mandatory payment, paid by the company every

month to its employees. Regardless of employee’s performance, salary must be given / paid on

monthly basis. Meanwhile Rivai et al (2014) defines that salary as the remuneration in the form

of money in return or as a payment of their position as an employee that contributes services and

ideas in order to achieve the company goals and aspirations . Or, it can also refer to a fixed

payments received by a person from the affiliation of a company.

Employee job satisfaction, at large, means how happy or unhappy employees are with

their jobs. According to Indeed.com, job satisfaction “displays the amount of gratification that

employees have when they’re in the workplace. There could be numerous factors that can

contribute to employee job satisfaction, yet, salary or compensation package may be regarded by

most employees to be their first consideration.”

In an article published by Haley de Leon (2022) entitled “How to Increase Employee Job

Satisfaction “, she emphasized that “Make sure that what you’re providing to your current
employees is enough salary and compensation package to retain them. Otherwise, it’ll be easy

for them to leave the company and look for a greener Pasteur.

A research “A study of salary satisfaction and job enthusiasm” by Lee, & Lin,. (2014),

proved that the relationships between employees’ salary satisfaction and psychological contract

and job enthusiasm are highly significant. When employees sense their salary is lower than the

market average, they will have unsatisfactory feelings, make less effort to the organization and

feel tired or want to leave the job.

In an article in https://www.peoplemattersglobal.com entitled “ Salary Satisfaction in the

Philippines” it was presented that according to UK-based recruitment consultancy Robert

Walters Plc, Filipino employees are most satisfied with their current salary levels as they

reported an average employee pay satisfaction of 7.1 (on a scale of 10) The survey also shows

that most jobs of the country will see a good increase in wages in the near future.

Martin Serreqi’s study entitled Relationship of Pay and Job Satisfaction retrieved in

European Journal of Marketing and Economics (2020) had proven that not all aspects of pay

satisfaction are job-related satisfaction. Overall, pay satisfaction and pay levels were related to

job satisfaction When there was no pay raise, no benefits, and no performance/structure.

Relationships Satisfaction with pay and salary levels was expected when considering job
satisfaction Empirical research may also be unrelated to other third dimensions presented the

context of the study.

Job Satisfaction

Many scholars have defined Job satisfaction and the main definition is the difference in

expectations about the job, and. Saying that, Locke (1969) is one of the scholars who defined job

satisfaction; Job satisfaction is the pleasant emotion that results from job appraisal or

performance management, while job dissatisfaction is the unpleasant emotion that results from

job appraisal such as frustration or inhibition of values (Schwepker, 2001).

While job satisfaction is influenced by many external factors, it is still somewhat internal

to the way the employee feels. There can be many factors that contribute to feelings of job

satisfaction and satisfaction. It also defines job satisfaction as a feeling of satisfaction and

accomplishment that comes from work, this feeling has nothing to do with money or things, or

even permission to leave A sense of security by employees have it from actual work. Hoppock

(1953) defined job satisfaction as any combination of mental, physical, and environmental

conditions such that a person genuinely claims to be satisfied with his or her job .

A large number of research papers and research papers have been written and published

by various researchers and scholars on employee job satisfaction indicating that it is a vast area

of research. Job satisfaction is defined as "a pleasant emotional state resulting from an
employee's evaluation of a work-related experience." (Malik, 2012). Hence it can be said that the

positive thinking of an employee about his/her job is responsible for the job satisfaction (Cadsby,

et. al 2012)

To sum up all definitions, job satisfaction is based on how employees feel about their job

– the positive aspects of work that make them feel valued or give them a sense of purpose, vs

the negative aspects, like long hours or unpleasant work, or feel that they are not treated as one

or employees.

Job satisfaction is viewed as a large and deep job research, many researchers have shown

that many cases and publish or write dissertations on job satisfaction. “Job satisfaction is a happy

or positive emotional state, the result of a search for work experiences”. It shows that optimism

about work and the environment around job leads one to satisfaction. so far as long as employees

want or want to work.

Relationship Between Salary Gratification and Job Satisfaction

With the continuous evolution of the human resource management system, several

researches pay more attention to the research on employee satisfaction surveys. As one of the

most important factors affecting firm performance, employee satisfaction has a significant

impact on the overall accumulation of employee happiness and satisfaction.

work. Different organizations have different types of rewards. The researchers found that for

developing countries like Pakistan, highly paid workers are more satisfied with their jobs,

compared to lower paid workers [Malik,2012]. Salary is a significant determinant of job

satisfaction however, there are also some other factors which have their impact on job

satisfaction including promotion, commitment and recognition etc. [Heywood,2006]. There are

also some researches which found that there is no significant relationship between pay,

promotion and job satisfaction [Peter,1995].

People in developing countries like the Philippines do not think from their brains but

from their stomachs. With unemployment and economic volatility, the only sure measure of job

satisfaction is pay and promotion.

In a study conducted by Sahibzada, A., & Khawrin, M. (2023). on the relationship

between salary and recognition on job satisfaction among college lecturers in Paktia University

found that the payment system implemented in Paktia University had a positive effect on the

academic staff. The improved pay system has increased job satisfaction and recognition, and

improves job satisfaction of university lecturers.

Job satisfaction is proven to increase productivity. However, creating the conditions to

increase job satisfaction is not easy. Objective workplace factors such as larger salaries and
higher status are not sufficient to ensure job satisfaction. Job satisfaction requires the

development of job characteristics that lead to meaningful employment as well as the possibility

of personal growth.

According to Siti Nuzulia and Hijrah Saputra in a study entitled “Do High Salaries

Ensure Job Satisfaction? : An Investigation on the Factors Affecting Job Satisfaction of

Educators in Indonesia” the salary had no effect on teachers’ job satisfaction. Work environment

positively influences job satisfaction but not over and above job characteristics, including job

authenticity, job performance, meaningful emotions experienced through work, work motivation

for personal growth, and recognition of one's accomplishments is included.

Malik, et. al emphasized that “pay has significant influence on job satisfaction but the

promotion has less influence and partially significant to the job satisfaction”

In a study on influence of salary package and promotion opportunities on job satisfaction

by Iqbal,et. al ( 2018) in a private retail industry in 2017-2018. Two independent variables

salaries and promotions were considered along with the impact on the dependent variable “job

satisfaction”, shows that pay and promotion have a significant effect on job satisfaction. Yet

there are some other factors that can positively influence job satisfaction including free medical

care workplace, children of educational agency employees, and insurance policies offered by

institutions.