From Game to Gain: How Gamified HRM Enhances Pay Equity and Work Engagement in Digitally Native Workforces

The emergent disengagement crisis in the global workplace has mandated the organizations to evaluate new human resource management (HRM) practices. Gamification has been one such approach and the mechanisms underlying its positive employee outcomes are not properly understood. In this study, we have tested a conceptual framework on “how gamification in HRM is related to work engagement among employees?”. We have further tested perceived pay equity and pay satisfaction as sequential mediators, and digital nativity as a moderator. Theoretical premises of gamification are based on Self Determinism and Flow theories, however we have built our argument on Equity Theory (ET) and Job Demands-Resources (JD-R) model. Data were collected from 292 employees in digitally adaptive organizations at Rawalpindi and Islamabad, Pakistan. Partial Least Squares Structural Equation Modeling (PLS-SEM) was used to test the hypothesized relationships. The results indicate that gamification substantially raises the perceived pay equity, which is highly significant to predict pay satisfaction, and consequently employee engagement. Sequential mediation tests also prove that indirectly gamification can lead to better engagement through the increase of fairness perceptions and pay satisfaction. In addition, digital nativity slightly enhances the relationship between gamification with perceived pay equity, and this implies that technological familiarity is a boundary condition in gamification of HRM. The results support ET and the JDR theorizing with respect to fairness and satisfaction as the key mediating factors between gamified HRM and engagement, bringing in the digital nativity as the new moderator. In practice, the study highlights the necessity to evolve gamified HRM systems that are being transparent, fair, and all-inclusive in regard to different degrees of digital competence. The study has provided future research directions to include psychological safety and digital savviness.