Salaries Rise During Workplace Romances with Supervisors... After Breakups and Resignations, "Why the Salary Drop?"

Analysis of Finnish Employment Data from 1988 to 2018
Salaries rise by 6% during workplace romances
After breakups, average salaries drop by 18%
Colleagues' dissatisfaction leads to higher turnover rates

An intriguing study has found that having a workplace romance with a superior positively influences salary increases. However, it also showed that after a breakup, employees who change jobs experience a sharp drop in salary.

According to the National Bureau of Economic Research (NBER) on October 23, researchers David McDonald, Emily Nix, and Jere Montonen released a report titled "The Effects of Workplace Romance with a Superior."

Salary increases by 6% during the relationship... Raises not tied to performance

A study has found that having a workplace romance with a superior positively influences salary increases. This is a stock photo provided for better understanding of the article and is unrelated to the content. Pixabay

The research team analyzed 30 years of employment administrative data from Finnish workers between 1988 and 2018 to examine how workplace romances between superiors and subordinates affect employee salaries. The results showed that subordinates who were romantically involved with their superiors saw their salaries increase by 6% during the period of the relationship. Unlike South Korea, Finland has a job-based pay system, and it is common for superiors to determine the salaries of their subordinates. The study indicates that when a romantic relationship develops, the superior may consciously or unconsciously raise the salary of their partner.

The researchers pointed out that this behavior negatively impacts organizational management. When subordinates involved in a romance with their superior receive salary increases regardless of performance, the turnover rate among dissatisfied colleagues rises by an average of 6 percentage points. This phenomenon was especially pronounced in small and medium-sized enterprises compared to large corporations.

After a breakup, employment retention drops by 13 percentage points... Salary decreases by 18% when changing jobs

Subordinates who broke up with their superior had an employment retention rate 13 percentage points lower than other employees. Notably, if these employees left the company after the breakup and moved to another job, their salaries decreased by 18%. The researchers analyzed that this is because, in the aftermath of a breakup and the rush to find new employment, individuals often accept positions with less favorable conditions than their previous jobs.

The research team stated, "While starting a relationship leads to higher income, breaking up often results in job loss or a move to a less advantageous position, causing long-term income loss. Rather than banning workplace romances, institutional measures should be established to prevent superiors from being involved in the evaluation and compensation of subordinates with whom they are in a romantic relationship."

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