Attitude Formation of Benefits Satisfaction: Knowledge and Fit of Benefits

Using the theoretical framework of the Theory of Reasoned Action [6], we examine benefits satisfactionas an attitude formed by the beliefs about benefits (i.e., benefits knowledge) and the perceived value ofthese benefits (i.e., fit of benefits to individual needs). We use questionnaires to gather data from arandom sample of 591 employees in a large county agency in the South-eastern United States. The datasupport that knowledge of benefits is associated with enhanced benefits satisfaction and mediates theeffect of explanations about benefits on satisfaction. The results provide strong evidence that benefitsperceived to suit employee needs generate highest benefits satisfaction. Employees satisfied with theirbenefits are less likely to consider leaving the organization. The tested model is a starting point for futurestudies to apply the extended Theory of Reasoned Action [1] and incorporate perceived behaviouralcontrol and subjective norms (i.e., co-workers’ attitudes) in forming benefits satisfaction. Understandingemployees’ affective and cognitive reactions to compensation, including benefits, can render betterpractices. Companies should use information campaigns to improve employee beliefs about benefits.Better attentiveness to individual needs and preferences can maximize the utility of a benefits plan andimprove its acceptance. We replicate and extend past research in a parsimonious model of benefitssatisfaction with a random sample of public sector employees.