The impact of justice perceptions of performance appraisal practices on job satisfaction and intention to stay: the mediating role of job engagement
| Date | 26 January 2024 |
| Pages | 408-431 |
| DOI | https://doi.org/10.1108/ER-07-2022-0328 |
| Published date | 26 January 2024 |
| Subject Matter | HR & organizational behaviour,Industrial/labour relations,Employment law |
| Author | Ram Shankar Uraon,Ravikumar Kumarasamy |
The impact of justice perceptions
of performance appraisal practices
on job satisfaction and intention to
stay: the mediating role of
job engagement
Ram Shankar Uraon
Institute of Management Studies, Banaras Hindu University, Varanasi, India, and
Ravikumar Kumarasamy
Department of Management Studies, Pondicherry University, Pondicherry, India
Abstract
Purpose –This study examines the direct impact of justice perceptions of performance appraisal practices
(procedural, distributive, interpersonal and informational justice) on job satisfaction, intention to stay and job
engagement. Further, it investigates the effect of job engagement on job satisfaction and intention to stay.
Moreover, the study tests the mediating role of job engagement on the impact of justice perceptions of
performance appraisal practices on job satisfaction and intention to stay.
Design/methodology/approach –A total of 650 self-report structured questionnaires were distributed
among the employees of 50 information technology companies, and 503 samples were received. Partial least
square-structural equation modeling was used to test the hypothesized model.
Findings –This study revealed that justice perception of performance appraisal practices positively affects
job satisfaction, intention to stay and job engagement. In addition, job engagement positively affects job
satisfaction and intention to stay. Further, job engagement significantly transfers the impact of justice
perceptions of performance appraisal practices on job satisfaction and intention to stay, thus confirming the
mediating role of job engagement. However, the significant direct impact of justice perceptions of performance
appraisal practices on job satisfaction and intention to stay in the presence of a mediator, i.e. job engagement,
revealed partial mediation.
Research limitations/implications –The findings of this study augment the social exchange theory by
explicating that an individual who perceives justice in performance appraisal practices is likely to have greater
job engagement, which ultimately leads to higher job satisfaction and intention to stay. This study filled the
research gap by examining the role of four justice components of performance appraisal practices on job
satisfaction and intention to stay and the mediating role of job engagement in transferring the impact of justice
perceptions of performance appraisal practices on job satisfaction and intention to stay.
Practical implications –This study showed the importance of four justice components of performance
appraisal practices in enhancing employee job engagement. Hence, this study would motivate information
technology companies to maintain fairness in performance appraisal practices to enhance employee job
engagement and ultimately increase job satisfaction and intention to stay.
Originality/value –This study is one of its kind that tested the direct impact of comprehensive justice
components (procedural, distributive, interpersonal and informational justice) of performance appraisal
practices on job satisfaction and intention to stay. In addition, this is a unique study that examined the
mediating effect of job engagement on the impact of justice perceptions of performance appraisal practices on
job satisfaction and intention to stay.
Keywords Justice perceptions, Performance appraisal practices, Job engagement, Job satisfaction,
Intention to stay, Information technology companies
Paper type Research paper
Introduction
Information technology (IT) companies have been struggling to retain their best talent due to
employee attrition, and recently, a new challenge, i.e. moonlighting, has knocked on the door
ER
46,2
408
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/0142-5455.htm
Received 19 July 2022
Revised 16 September 2023
1 November 2023
Accepted 11 January 2024
Employee Relations: The
International Journal
Vol. 46 No. 2, 2024
pp. 408-431
© Emerald Publishing Limited
0142-5455
DOI 10.1108/ER-07-2022-0328
(Singh et al., 2023;Zaman and Ansari, 2023). It refers to working at an extra job outside one’s
primary employment (Choudhary and Saini, 2021). According to the Times of India report
(Gupta, 2023), 73% of the workforce is enticed to work at an extra job because of the financial
rewards. It has been seen that a lack of employee motivation and commitment forces
employees to take such extreme steps (Choudhary and Saini, 2021). One of the factors that
negatively affect employee motivation and commitment is the lack of perceived fairness in
performance appraisal practices (Brefo-Manuh and Anlesinya, 2023). Hence, in recent years,
understanding justice (fairness) in performance appraisal practices has attracted the
attention of practitioners and researchers. Thurston and McNall (2010) proposed four justice
dimensions (i.e. procedural, distributive, interpersonal, and informational) to examine the
perceived fairness of performance appraisal practices. Despite the significant role of
performance appraisal justice (Gupta and Kumar, 2013;Brefo-Manuh and Anlesinya, 2023),
its effects on desirable employee outcomes have not been thoroughly studied (Rana and
Singh, 2022).
Performance appraisal practices are the systematic and periodic process of evaluating an
employee’s performance against set goals (Kampk€
otter, 2017). IT companies, which are
known for their innovative and progressive outlook, have embraced performance appraisal
practices quickly. It has become a vital tool for IT companies as it helps to improve employee
performance, contributes to various other human resource functions, and enhances
organizational effectiveness (Iqbal et al., 2019). More importantly, performance appraisal
practices also hold significance for employees as the outcome of performance appraisal
practices has implications for many decisions, such as future job promotions, pay increments,
and career development (Kampk€
otter, 2017). As the outcome of performance appraisal
practices has an impact on employees’monetary and non-monetary benefits, justice in the
performance appraisal practices is crucial for employees at work. For years, maintaining
fairness in performance appraisal practices has been a concern for many IT companies (Iqbal
et al., 2019). However, they are continuously reinventing performance appraisal practices to
ensure a fair and equitable approach to performance reviews in the future (Schooley, 2023).
Despite this, justice in performance appraisal practices has been a difficult goal for
organizations to achieve (Iqbal et al., 2019).
Studies suggest that justice or fairness is the basic principle of performance appraisal
practices. The lack of fairness in performance appraisal practices may have an adverse effect
on employees’attitudes and behavior at work (Sepahvand et al., 2020;Pagan and Malo, 2021).
Substantiating the above discussion, Brefo-Manuh and Anlesinya (2023) stated that
performance appraisal can affect job satisfaction if organizations are unable to maintain
fairness and transparency in the entire performance appraisal practice. Knezovi
c and
Neimarlija (2023) posit that perceived justice or fairness can increase employee satisfaction
and enhance the willingness to stay with the organization. Moreover, justice or fairness can
affect the overall organizational effectiveness of IT companies; as Rai (2015) suggested,
justice minimizes the negative consequences on employees’mental health at work and
reduces absenteeism.
Recently, the focus has shifted toward whether fairness or justice perceptions of
performance appraisal (JPPA) practices affect employees’workplace outcomes, such as
attitudes and behaviors (Gupta et al., 2022;Vid
eet al., 2022). However, limited informationis
available on JPPA practices’role in various employee outcomes (Gupta and Kumar, 2013;
Brefo-Manuh and Anlesinya,2023;Rana and Singh, 2022). Also, most studies on performance
appraisal justice have examined only two or three dimensions of justice (Brefo-Manuh and
Anlesinya,2023;Rana and Singh, 2022). There is a paucity of research that has investigated all
four dimensions of performance appraisal justice and its relationships with employee
outcomes (Thurstonand McNall, 2010;Gupta and Kumar, 2013). Several authorshave claimed
that diverse justice dimensions will likely affect employee-related outcomes differently
The impact of
justice
perceptions
409
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