Question 12 Equity Theory, developed by J. Stacey Adams, proposes that A managers must treat all subordinates with dignity, respect, and politeness. 1 Point B employees perceive fairness when they compare their own input: output ratio with the ratio of relevant reference. procedures that are used to determine how to distribute outcomes in an organization must be fair and just for everyone. employees must perceive an equitable degree of fulfillment of both Esteem and Self-actualization needs.