Does wage rank affect employees' well-being?

How do workers make wage comparisons? Both an experimental study and an analysis of 16,000 British employees are reported. Satisfaction and well-being levels are shown to depend on more than simple relative pay. They depend upon the ordinal rank of an individual's wage within a comparison group. Rank itself thus seems to matter to human beings. Moreover, consistent with psychological theory, quits in a workplace are correlated with pay distribution skewness.