This study examines the effect of executive-worker pay disparity on the operational efficiency of firms listed on the KOSPI and KOSDAQ from 2012 to 2020. Additionally, it investigates the impact of employment stability, as measured by the ratio of full-time employees, on the relationship between executive-worker pay disparity and operational efficiency. The results reveal that executive-worker pay disparity negatively impacts a firm's operational efficiency. Furthermore, the adverse effect of executive- worker pay disparity is mitigated as the ratio of full-time employees increases. The study also finds that when the analysis is conducted based on employees' years of service within the same industry, the mitigating effect of the ratio of full-time workers becomes more pronounced for employees with service years exceeding the industry median. This study provides empirical evidence that executive-worker pay disparity impairs employee motivation and adversely affects a firm's operational efficiency, while such negative impact is alleviated by employment stability. This study also provides practical implication that executive-worker pay disparity should be carefully considered when determining the compensation levels of executives and employees in order to enhance a firm's operational efficiency.