Pay-for-performance, procedural justice, OCB and job performance: a sequential mediation model

Abstract

Purpose

Building on the arguments of expectancy theory and social exchange theory, the present study provides insights into the process by which pay-for-performance (PFP) impacts employee job performance.

Design/methodology/approach

Based on a sample size of 226 employees working in a technology company in India, the study examines the relationships between PFP, procedural justice, organizational citizenship behavior (OCB) and employee job performance. Data on perceptions of PFP and procedural justice were collected from the employees, data on OCB were collected from the supervisors and the data on employee job performance were collected from organizational appraisal records.

Findings

The study found support for the positive relationship between PFP and job performance and for the sequential mediation of the relationship between PFP and job performance via procedural justice and OCB. Further, procedural justice was found to mediate the relationship between PFP and OCB.

Research limitations/implications

The study was cross-sectional, so inferences about causality are limited.

Practical implications

The study tests the relationship between PFP and employee job performance in the Indian work context. The study shows that the existence of PFP is positively related to procedural justice which, in turn, is positively related to OCB. The study found support for the sequential mediation of PFP-job performance relationship via procedural justice and OCB.

Originality/value

The study provides an insight into the underlying process through which PFP is related to employee job performance. To the best of our knowledge, such a study is the first of its kind undertaken in an organizational context.

Citation

Gupta, V., Mittal, S., Ilavarasan, P.V. and Budhwar, P. (2024), "Pay-for-performance, procedural justice, OCB and job performance: a sequential mediation model", Personnel Review, Vol. 53 No. 1, pp. 136-154. https://doi.org/10.1108/PR-11-2021-0782