Human resource management practices and employee retention in the Indian textile industry

Abstract

Purpose

This study is the maiden attempt to understand the effect of specific human resource practices (HRPs) on employee retention (ER) with the mediation of job satisfaction (JS) and moderation of work experience (WE) and job hopping (JH) in the context of the textile industry.

Design/methodology/approach

This study adopted a quantitative methodology and applied quota sampling to gather data from employees (n = 365) of leading textile companies in India. The conceptual model and hypotheses were tested with the help of Partial Least Squares-Structural Equation Modelling (PLS-SEM).

Findings

The findings of a path analysis revealed that compensation and performance appraisal (CPA) have the highest impact on JS followed by employee work participation (EWP). On the other hand, EWP had the highest impact on ER followed by grievance handling (GRH). The study revealed that JS significantly mediates between HRPs like CPA and ER. During Multi-group analysis (MGA) it was found that the importance of EWP and health and safety (HAS) was more in employee groups with higher WE, but it was the opposite in the case of CPA. In the case of JH behavior, the study observed that EWP leads to JS in loyal employees. Similarly, JS led to ER, and the effect was more pronounced for loyal employees.

Originality/value

In the context of the Indian textile industry, this work is the first attempt to comprehend how HRPs affect ER. Secondly, it confirmed that JS is not a guaranteed mediator between HRPs and ER, it could act as an insignificant, partial or full mediator. Additionally, this study establishes the moderating effects of WE and JH in the model through multigroup analysis.

Citation

Kalia, P., Singla, M. and Kaushal, R. (2024), "Human resource management practices and employee retention in the Indian textile industry", International Journal of Productivity and Performance Management, Vol. 73 No. 11, pp. 96-121. https://doi.org/10.1108/IJPPM-01-2022-0057

1. Introduction

Human beings are the “soft resources” which require efficient management for the rise of an organization. Only humans can make physical and financial assets more productive. By improving and developing the knowledge, skills, motivation and morale of HR, organizations can gain an advantage over their competitors. According to Walker (2001), successful organizations invest in their employees and manage the retention of promising employees. Therefore, the management of human resource practices (HRPs) like manpower planning, training, financial incentives, motivation, grievance redressal, etc. are crucial issues in a business organization that require utmost care and consideration to attain, maintain and retain competent people. The ultimate aim of HRPs is to attain organizational success through its manpower, capabilities, availing new opportunities by influencing the organizational behaviour of its people (Cherif, 2020; Jawaad et al., 2019), shaping the behaviour of employees (Waheed et al., 2018) and subsequently the organizational performance.

The Indian textile industry is one of the first and firmly established industries in India covering a wide range of sections, from unorganized hand-woven segments to organized technology and capital concentrated segment. Textile sectors provide elementary amenities of life and generate employment, especially in rural areas (Singla, 2017). The sector adds to 2% of India's GDP, 7% of industrial production and 12% of export earnings. It is valued at USD 40.4 billion. In global trade and textile apparel, the country has a 5% share. The textile and apparel sector provides direct and indirect employment to approximately 51 million and 68 million respectively and it is the second-largest employment provider. The Government of India is focusing on the textile industry to attain India's participative and inclusive development by enhancing skills and innovation in the sector (Ministry of Textiles, 2019). This global competition demands the industry focus on upgrading its product quality, cost structure, technology, marketing skills and HR to provide a competitive advantage. According to Piasecki (2019), employees show higher commitment and lower attrition rates when the HRPs are well-defined. Satisfied employees always contribute to achieving organizational objectives. Hence, a company should pay more attention to discovering factors that make employees more satisfied and productive (Pradhan et al., 2019) and this can be achieved through strong HRPs. Researchers noticed that competition and digitalization in the workspace have increased the need for strong HRPs and job satisfaction (JS) for the survival of modern organizations in the present era (Doghan et al., 2019; Silic et al., 2020). Previous studies have discussed the substantial effects of HRPs on JS and employee retention (ER) (Cherif, 2020; Ling et al., 2018; Mahmood et al., 2019; Rombaut and Guerry, 2020).

While searching for the studies related to HRPs and employee retention or turnover intentions, we noticed variations in HRPs reported in different studies, and the authors invited future studies to consider more HRPs (Amah and Oyetunde, 2019; Ma et al., 2016; Piasecki, 2019). Likewise, previous studies have researched dynamics between similar constructs, that is HRPs, JS and ER, or related constructs like quit intentions (Dechawatanapaisal, 2018), employee commitment (Mahmood et al., 2019), turnover intentions (Coudounaris et al., 2020; Piasecki, 2019), organizational commitment (Amah and Oyetunde, 2019; Cherif, 2020; Park and Doo, 2020), etc. However, to the best of our knowledge, this is the first study that has tested these constructs in the context of the textile industry. Most of the previous studies are in the context of the banking industry (Cherif, 2020; Mahmood et al., 2019; Piasecki, 2019) or there is a mixed sample from various industries like manufacturing, wholesale, retail, services construction, or other sectors (Amah and Oyetunde, 2019; Park and Doo, 2020). There was a strong call for future research with a more diversified sample from a variety of business sectors or organizations or industries (Amah and Oyetunde, 2019; Dechawatanapaisal, 2018). Hence, we considered a sample from the textile industry which is the least explored. Also, our sample is larger compared to previous studies (Cherif, 2020; Coudounaris et al., 2020; Mahmood et al., 2019; Park and Doo, 2020). We considered JS as a mediating variable in the model because previous studies have tested its mediating effect in their model but with different independent and dependent variables (Coudounaris et al., 2020; Mahmood et al., 2019). Several HR-related studies confirm high significant relationship between JS and ER. For instance, while examining co-worker relations at workplace Abugre (2017) confirmed very significant positive effect of JS on employees' intention to stay. Kim and Kim (2021) tried to identify the predictors of Registered Nurses' turnover intention and found that the effect size of JS is greater than job embeddedness. Further, while studying the turnover intention among academic staff in Malaysia's public universities Yusoff et al. (2022) found no significant effect of job embeddedness (Link and Fit) on turnover intention. Similarly, Yu et al. (2020) reported insignificant effect of job embeddedness (Link) on JS, but a very strong significant effect of JS on work engagement (t = 5.680) and turnover intentions (t = −10.561). Considering the insignificant results of job embeddedness on turnover intention in certain studies and high correlation of variable such as work engagement with JS (Ramaite et al., 2022), the current study focused on the role of JS. Similarly, many previous studies acknowledged the absence of multi-group analysis as one of their limitations (Mahmood et al., 2019), and invited more categories based on demographic characteristics, personal dispositions, or contextual constructs (Dechawatanapaisal, 2018; Park and Doo, 2020). We noted that none of the earlier research had included any type of testing related to work experience (WE) and job hopping (JH) as moderators, therefore we introduced them in our model (Table 1). Hence, the current study aims to address these gaps by researching the effect of specific HRPs on ER with the mediation of JS and moderation of WE and JH in the context of the Indian textile industry. The theoretical underpinning of the concept and hypothesis formation are presented first, followed by the research technique and outcomes. The last sections include a discussion, theoretical and practical implications, shortcomings and future directions.

2. Theoretical context and hypothesis formulation

HRPs are designed to manage human resources to fulfill organizational goals. These are framed to enhance human resource capability, efficiency, commitment and productivity (Zahoor et al., 2015). HRPs vary within organizations depending on the requirements of the employee as distinct practices are used to manage different groups of employees (Piasecki, 2019; Presbitero et al., 2016). HR studies indicated that there are multiple ways to measure HRPs but there is no widely accepted definition to theoretically and empirically select the most important ones (Mahmood et al., 2019). Various empirical studies revealed that the execution of HRPs such as performance appraisal, training and development, compensation, grievance redressal, health and safety and employee work participation impacts the effectiveness of qualified human resources (Khan et al., 2019; Sheikh et al., 2018; Subramaniam et al., 2011). In this study, we theorize to examine the effect of specific HRPs on employee retention through the mediating role of JS.

2.1 Social exchange theory (SET)

The theoretical framework of the study has been rooted up based on social exchange theory (SET) which has been considered a base for employer and employee relationships in the context of HRPs and ER (Coyle-Shapiro and Conway, 2005). SET describes the interaction between individuals and organizations that are viewed as social exchanges (Cook et al., 2013). Further, this theory explains that employees perform better when organizations adopt good HRPs. According to Piasecki (2019), the dimensions of HRPs can be well explained with the help of SET for the employees to grow and stay for a longer period.

2.2 Employee retention (ER)

Retention is more economical than recruiting new employees and is a key parameter of the strength of a business organization (Kundu and Lata, 2016; Presbitero et al., 2016). Organizations spend a lot of money, time and effort to train employees to adapt to the organizational environment, and losing a valued employee may even amount to a loss of two and a half times his salary (Kapoor, 2015; Nazia and Begum, 2013). Business units need to create an environment to retain employees for economic revival (Singla, 2017). Employees can be retained by reward, recognition and respect – the 3 Rs which improve efficiency through a favorable work environment (Nazia and Begum, 2013) and improve the employee fit in an organization (Presbitero et al., 2016). Presbitero et al. (2016) in their study established the direct effects and indirect effects of HRPs on employee retention with the help of compensation, EWP and TAD. Thus, ER is highly dependent on HRPs followed in the organization as good practices lead to JS which adds to ER (Krishna, 2019; Papa et al., 2018; Rombaut and Guerry, 2020). The present research is being carried out in the textile industry so that innovative HRPs and their impact on employee retention can be known to strengthen the work culture of an organization.

2.3 Compensation and performance appraisal (CPA)

Compensation and rewards are considered by many studies to be the best way of retaining employees (Rombaut and Guerry, 2020). A suitable pay structure enhances employee motivation to work and improves productivity, efficiency and attain competitive advantage inculcating a feeling of security thus, reducing stress and adding to employee performance (Galetić and Klindžić, 2020; Subramaniam et al., 2011). Employees with higher pay packages are assumed to work with more commitment and stay longer with their current employer (Cherif, 2020) irrespective of the JS level (Ngoma and Ntale, 2019). Similarly, Performance appraisal is an important HR practice that examines the strengths and weaknesses of employees' performance (Kalia and Mishra, 2023). “Performance appraisal is the process of assessing the performance and progress of an employee on a given job and his potential for future development” (Gupta, 2012). The fairness of compensation, and performance appraisal augments positive attitude, and employee commitment and enhances the JS level of employees (Ngoma and Ntale, 2019) further resulting in ER. The compensation and appraisal practices ensure quality at work and make employees loyal and satisfied, therefore, stimulating job satisfaction and employee retention (Lasisi et al., 2020; Waheed et al., 2018). Thus, drawing from the foregoing literature, the following hypothesis has been formulated.

H1.

CPA has a positive and significant effect on JS (H1a) and ER (H1b).

2.4 Employee work participation (EWP)

Singla (2017) perceived EWP in management as an important element in the decision-making process of the organization. It is the emotional and mental involvement of employees in the goals and sharing of responsibilities in an organization. EWP in organizational decision-making helps in attaining industrial peace and harmony which leads to increased productivity, commitment, belongingness and finally success of the organization (Bhatti and Qureshi, 2007; Kapoor, 2015; Manzoor et al., 2019). According to Ni et al. (2020), EWP is considered a key indicator of organizational health and has a significant impact on employee performance, JS and ER. The feeling of belongingness enhances commitment resulting in employee progress, satisfaction and thus, organizational performance (Ngoma and Ntale, 2019). Similarly, Suhartanto and Brien (2018) also found that work engagement leads to job satisfaction. Employees with high work participation have a more positive attitude towards their work and organization and improve their work skills thus leading to JS (Ni et al., 2020) and retaining employees for a longer time.

The above discussion helps us postulate that:

H2.

EWP in management has a positive and significant effect on JS (H2a) and ER (H2b).

2.5 Grievance handling (GRH)

Discipline means orderliness in human behaviour and action to maintain good industrial relations and efficiency among the workers adding to the uniformity in decision-making and reducing employee unrest and wastage of resources (Kapoor, 2015). A grievance is a feeling of dissatisfaction and injustice which an employee has about his employment relationship which may be expressed or implied (Elbaz et al., 2019). Working conditions, management policy, alleged violations and personal maladjustment are the main causes of grievances (Gupta, 2012). The existence of a well-functioning GRH system helps to minimize conflicts in the organization. Timely and effective grievance redressal leads to the high morale of employees facilitating the attainment of high commitment and ER (Singla, 2017). Therefore, we hypothesize that:

H3.

GRH has a positive and significant effect on JS (H3a) and ER (H3b).

2.6 Health and safety (HAS)

HAS of the employees is a critical factor to be taken care of by the management. As per International Labour Organization (ILO), “Occupational health should aim at the promotion and maintenance of the highest degree of mental, physical and the social well-being of the employees; the protection of workers in their employment from risks resulting from factors adverse to health and maintenance of the employees in an occupational environment adapted to their physiological and psychological capabilities” (ILO, 2023). The implementation of proper HAS standards in the workplace improves the employees' organizational performance, and productivity and reduces the costs related to accidents, absenteeism, disabilities and illness. It implies that employees who consider their work and environment to be safe and healthy continue to stay in the organization and are directly related to the JS level and retention of their employees (Liu et al., 2019; Poursadeqiyan et al., 2019; Sheikh et al., 2018).

The above discussion helps us postulate that:

H4.

HAS has a positive and significant effect on JS (H4a) and ER (H4b).

2.7 Training and development (TAD)

Training is the systematic process to match career goals with individual capabilities that help people acquire the necessary skills to perform their jobs satisfactorily (Armstrong, 2012; Gupta, 2012; Subramaniam et al., 2011). An organization can strengthen its bond with its employees by focusing and investing in their TAD equipping them with increased knowledge, and enhanced skills resulting in JS and commitment (Ngoma and Ntale, 2019). Similarly, Piaralal et al. (2016) found that empowerment and training can positively influence service recovery performance, which further positively influences JS. Lasisi et al. (2020) highlighted the role of training and development in the organization that enhances the level of innovation thereby contributing to JS and enhancing employee proactivity. According to Rombaut and Guerry (2020), employers should provide possibilities for growth and development through internal or external training. It ensures the availability of a skilled workforce in an organization to handle the challenges of growth and a dynamic business environment (Singla, 2017). Further training and development provide employees with career progression opportunities and act as a motivator for employees to stay with their employers (Piasecki, 2019). The above discussion helps us posit the following hypotheses:

H5.

TAD has a positive and significant effect on JS (H5a) and ER (H5b).

2.8 Job satisfaction (JS) and its role as a mediator

JS is an essential feature to develop employees' commitment to an organization (Cherif, 2020; Ni et al., 2020). JS is an employee's positive feelings from job experience (Beuren et al., 2022). Social Exchange Theory supports the principle of reciprocity which implies that good HRPs and fair treatment by the employer will encourage the employees to show positive work responses along with a high JS level (Ahmad and Umrani, 2019; Al Doghan et al., 2019; Ling et al., 2018). HRPs like compensation, work-life balance, organizational environment, HAS, and timely GRH work increase the JS (Ma et al., 2016; Stamolampros et al., 2019). According to Ni et al. (2020), linking to social exchange theory, JS is gained in the organization when good HRPs are followed. Further from the SET perspective, good HRPs are perceived by employees as a sign of the employer's appreciation which contributes to JS (Piasecki, 2019). Garg (2019) also found that JS mediates between high-performance work practices and organizational performance. Similarly, Huang and Su (2016) established the mediating role of JS to reduce the turnover intention of employees. Azeem et al. (2020) quoted that job dissatisfaction activates employees' thoughts about leaving the organization. Satisfied employees consider their work environment as an important factor that enhances ER (Stamolampros et al., 2019; Tripathi and Kalia, 2022). Research studies indicated an inverse relationship between the low level of JS with ER (Moore et al., 2020; Nazia and Begum, 2013). Organizations can increase the JS and ER, by employing HRPs that focus on employees' long-term growth and well-being (Coudounaris et al., 2020; Mahmood et al., 2019; Piasecki, 2019). Hence, we propose that:

H6.

JS has a positive and significant effect on ER.

H7.

With JS as a mediator, CPA (H7a), EWP (H7b), GRH (H7c), HAS (H7d) and TAD (H7e) have a significant positive influence on ER.

2.9 Work experience (WE) and its role as a moderator

The employees with longer WE expressed higher JS levels in comparison to the employees with lower WE (Knight et al., 2006). Research studies indicate the direct association of high WE with JS level and career growth (Kim and Cunningham, 2005; Peiró et al., 2010). The employee JS is high when the organization values employees' contributions and cares for their well-being (Maden, 2014). Employees with more WE handling challenging job assignments expressed their JS with related work that paved their career progression (Lasisi et al., 2020). Researchers believe that work experience is correlated to higher pay (Schmid and Baldermann, 2021). In terms of employee retention, researchers have confirmed that employees with work experience between 0 and 5 years are most likely to leave the organization (Aswale and Mukul, 2020). In the context of health conditions, Vecchio et al. (2011) reported a likelihood of injury based on years of work experience. Certain studies suggested future investigation of the evaluation of staff while considering their work experience (Makarenko et al., 2020). Hence, we propose that:

H8.

Significant differences exist between employees with experience of ≤3 years, 4–6 years and 7–9 years, on the links in the tested structural model.

2.10 Job hopping (JH) and its role as a moderator

Job hopping or frequent job change by the employees intimate an organization to introspect its varied policies and their impact on human resources. Research studies also indicate JH, and JS have an inverse relationship (Saleem and Qamar, 2017). Therefore HR managers need to give due consideration to the job-hop behavior of employees (Steenackers, 2016). In the case of voluntary JH, the pay raise is higher when the employees get favorable job offers in the new firms which have a positive relation with JS and results in the retention of such employees (Gao et al., 2015; Hemdi et al., 2018). In their study, Cox and Warner (2013) reported that due to poaching and job hopping multinational companies (MNCs) hesitate to invest in TAD. Similarly, while examining the relationship between HRPs and turnover among Malaysian engineers, Rahman (2012) found that EWP particularly relating to TAD and CPA leads to feelings of perceived organizational support which can influence commitment and turnover intentions. Some researchers have reported a greater amount of learning leads to reduced JH behaviour (Huang and Zhang, 2016). Hence, we propose that:

H9.

Significant differences exist between employees who have never, once, or twice changed their job, on the links in the tested structural model.

The complete research model is depicted in Figure 1.

3. Research methodology

For the study, fourteen textile units were selected from the list of textile companies in India listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) based on their total assets, net sales and market capitalization. The textile industry was selected because it is the second-largest employment provider in India (Ministry of Textiles, 2019). The current study's scope is limited to the textile units in India with a registered office in the Punjab state. Punjab produces 95 and 85% of woolen knitwear and sewing machines respectively of the entire India (IBEF, 2021). All the textile units under the study were operational for more than three years.

3.1 Research design

For data collection, employees of selected textile units were contacted personally or through e-mails and participation was voluntary. Employees and HR heads were reminded through regular emails and phone calls, and one of the authors visited different units personally to ensure timely completion of the data collection. Quota sampling was implemented for gathering data and PLS-SEM was used for data analysis. For the study, employees are categorized into three levels, that is top, middle and junior. HRPs followed by every industry have a variation as per the respective requirement of their employees. Specific HRPs were selected based on personal interviews and interactions with the employees at various levels along with input from the HR department.

3.2 Data collection and sample

The data was gathered using quota sampling from August to November 2019 in the English language. A total of 425 employees were contacted, 390 employees filled out the questionnaire and 365 responses were finalized after removing the missing cases. The response rate was 85.88%, which is extremely high according to the acceptable values (Nulty, 2008). The sample size for the structural model was determined using an a priori approach (Soper, 2021). With a desired statistical power level of 0.8, a medium anticipated effect size of 0.22 (Cohen, 1992), seven latent variables and 49 observed variables at a 0.05 probability level, the recommended minimum sample size was 365. Our sample was the recommended sample size. The sample had 67.1% males and 32.9% females (Table 2). Marital status-wise, 25.2% were unmarried, while 74.8% were married. The sample had most respondents from 26 to 35 years (42.5%) and 36–45 years (41.40%) age group categories. Most employees (48%) were working with their present organizations for 4–6 years, followed by employees having tenure less than three years (26.8%) or between 7 and 9 years (25.2%). Concerning JH nearly 32% of employees never changed their job, while 34% changed it once and nearly 35% were working on their second job indicating a frequent JH trend among employees.

3.3 Measurement and scale

For measuring CPA (13) and TAD (4) we adapted scale items from Arthur (1994) and Subramaniam et al. (2011). The scales for EWP (7) and GRH (4) were adapted from Bhatti and Qureshi (2007) and (Koch and McGrath, 1996), respectively. The scales for JS (9) and HAS (3) were taken from Macdonald and Maclntyre (1997). ER (9) scale was adapted from Mobley et al. (1978) (Table 3).

4. Results

4.1 Measurement model

We reported the results of the measurement model for factor loadings, variance inflation factor (VIF), Cronbach alpha, composite reliability (CR) and average variance extracted (AVE) to test the predicted model (Hair and Sarstedt, 2011) (Table 4). All the factor loadings above 0.5 were retained (Hair et al., 2019a, b) and the results of CR exceeded the value of 0.7 (Grewal et al., 2004; Hair et al., 2019b). After dropping items ER2, ER4, ER9 and JS8 the value of AVE for all the variables was greater than the minimum threshold point of 0.5 (Babin et al., 2008; Hair and Sarstedt, 2011). Cronbach's alpha as a measure of reliability also surpassed the recommended value of 0.7 (Grewal et al., 2004). As the common bias method (CMB) has received more attention, considerable effort has been invested in the development of quantitative post hoc techniques in HR studies (Bozionelos and Simmering, 2022). To check the presence of CMB we applied two post hoc methods. First, we performed Harman's single-factor test and the first factor accounted for 38.37% which was less than the permissible limit of 50% (Podsakoff and Organ, 1986). Secondly, we followed the comprehensive procedure proposed by Kock (2015) to identify common method bias established on VIFs generated via a full collinearity test. Through this procedure, we generated VIFs for all latent variables in the inner model in SmartPLS. The occurrence of a VIF greater than 3.3 is proposed as an indication of pathological collinearity, and an indication that a model may be contaminated by CMB. In the current study, we found that all the VIF values resulting from a full collinearity test were lower than 3.3, hence, the study was free from bias (Table 4). Further, the values of the latent variables for the HTMT ratio were less than 0.9 (Henseler et al., 2014), thus establishing the discriminant validity (Table 5).

4.2 Structural model

Table 6 reports the results of the structural model indicating that CPA (β = 0.596, p < 0.000) had the strongest impact on JS followed by EWP (β = 0.335, p < 0.000). It is to be noted here that EWP also had a high impact on ER (β = 0.274, p < 0.014). Therefore, the management and companies should try to increase EWP to reduce the attrition rate and increase JS in the long run. GRH had a significant impact on ER (β = 0.119, p < 0.021) but an insignificant impact on satisfaction (β = −0.024, p > 0.532). No significant impact of HAS and TAD on JS and ER was observed. We noticed that JS has a significant influence on ER (β = 0.438, p < 0.000). As per r-square values, 72% variance in JS was explained by HRPs, and 64.8% variation in ER was explained by JS.

4.3 Mediation analysis

The mediation analysis was performed as per the guidelines of Ringle et al. (2022a, b). The indirect effects are exhibited in Table 7. The findings of the study confirm a significant mediating role for JS between HRPs and ER with its dimension namely CPA (t = 4.254, p < 0.000). However, this dimension was directly insignificant with ER which indicates that JS fully mediates between CPA and ER. Further, it was observed that JS partially mediates between EWP and ER (t = 3.254, p < 0.000). However, no mediation effect was observed for GRH, HAS and TAD.

4.4 Multi-group analysis (MGA)

Several prior studies have proposed that the moderating influence of demographic characteristics, personal dispositions, or contextual constructs be investigated (Dechawatanapaisal, 2018; Park and Doo, 2020). Hence, we performed a partial least squares multigroup analysis in the second step (PLS-MGA) by separating the sample based on JH and WE (Matthews, 2017; Ringle et al., 2022b). Instead of depending on distributional assumptions, the PLS-MGA considers the bootstrap's observed distribution, allowing it to handle small and varied sample sizes (Sarstedt et al., 2011).

The WE in the sample was classified into three groups, that is employees with experience less than 3 years (group 1), between 4 and 6 years (group 2) and 7–9 years (group 3). As shown in Table 8, CPA significantly led to ER and JS for groups 1 and 2 employees however it was insignificant for group 3 employees. The results indicate that compensation and appraisal are important for employees with less experience in comparison to employees with higher experience. On the contrary, the importance of EWP increased with an increase in experience, that is the p-value was non-significant in group one, significant at a 5% level in groups 2 and 3 with an increase in t-value from 2.78 to 2.94 respectively, contributing to ER and JS. GRH was significant at a 5% level in group 2 only, indicating grievance handling becomes important for employees after the initial few years. HAS was non-significant for groups 1 and 2 but significant for group 3, indicating that experienced employees consider HAS as an important HR practice. All three groups exhibited a relation between JS and ER at a 1% level of significance. TAD was insignificant among all three groups.

The frequency of JH in the study was classified into three groups (Table 9) that is employees who never changed their job (group 1), changed their job once (group 2) and changed their job twice (group 3). We noticed that CPA significantly led to JS and ER in all the groups and based on the t-value we can notice that the effect was high in group 1. The EWP was highly significant at a 1% level for group 1, whereas it was insignificant for employees under groups 2 and 3 for both ER and JS. The results for GRH, HAS and TAD was non-significant in all three groups. Overall JS was highly significant towards ER at a 1% level of significance in all three groups.

5. Discussion

In this article, we have researched the effect of HRPs on ER with the mediation of JS and moderation of WE and JH. This research uncovers several intriguing inconsistencies and new results for the textile industry.

We hypothesized, based on the literature, that CPA has a significant positive effect on JS (H1a) and ER (H1b) (Figure 2). We found that CPA has a highly significant positive effect on JS but an insignificant effect on ER. The first hypothesis (H1a) resonates with previous studies concluding that fairness of compensation and performance appraisal augments positive attitudes and enhances the JS level of employees (Arthur, 1994; Kamau et al., 2021; Lasisi et al., 2020; Subramaniam et al., 2011; Waheed et al., 2018). However, H1b contradicts earlier studies that proposed that employees with better compensation and performance appraisal stay longer with their employer (Cherif, 2020; Islam et al., 2022; Ngoma and Ntale, 2019).

The second hypothesis regarding the significant positive effect of EWP on JS (H2a) and ER (H2b) was fully supported and corresponds to the results of previous studies which state that employee participation in decision-making leads to increased productivity, satisfaction, retention, belongingness and finally the success of the organization (Bhatti and Qureshi, 2007; Islam et al., 2022; Kapoor, 2015; Malik et al., 2017; Manzoor et al., 2019; Ngoma and Ntale, 2019; Tymon et al., 2011).

However, the third hypothesis regarding the significant positive effect of GRH on JS (H3a) and ER (H3b) was partially supported. Because in the current study, it was found that GRH positively affects ER only and not JS (H3a). Therefore, the findings on the third hypothesis correspond only to the previous studies inferring that timely and effective grievance redressal leads to high morale and better quality of work life facilitating the attainment of high commitment and ER (Nanjundeswaraswamy and Beloor, 2022; Singla, 2017). However, our results do not support the fact that impartial grievance handling can significantly impact employee job satisfaction (Joseph et al., 2022).

The fourth and the fifth hypotheses regarding the significant positive effect of HAS and TAD on JS and ER were not supported and they contradict the results of past studies that concluded that better health and safety provisions in an organization (Liu et al., 2019; Poursadeqiyan et al., 2019; Sheikh et al., 2018) or investing in TAD of employees (Armstrong-Stassen and Stassen, 2013; Nanjundeswaraswamy and Beloor, 2022; Ngoma and Ntale, 2019) will lead to JS and ER.

In the sixth hypothesis, it was proposed that JS has a positive and significant effect on ER. This hypothesis was supported and corresponds to previous studies. For example, Bharadwaj et al. (2022) found that among IT professionals, an improved identification among contented workers decreases the intention to quit. Similarly, De Sousa Sabbagha et al. (2018) reported that work satisfaction is positively related to staff retention. There are other previous studies too which suggest that satisfied employees stick to their organizations (Moore et al., 2020; Stamolampros et al., 2019).

Under the seventh hypothesis, the current study establishes JS as a significant mediator between HRPs like CPA, EWP and ER. Most importantly, JS acts as a full mediator in the CPA→JS→ER link (H7a) and partial mediator in the EWP→JS→ER link (H7b). This result (H7a) contradicts the findings of Mahmood et al. (2019) as they reported the absence of mediating effect of JS between financial remuneration strategies and commitment. However, we could find supporting references for H7b, as Atouba (2021) reported that the relationship between employee work participation and organizational commitment is mediated by job satisfaction.

We added WE (H8) and JH (H9) as moderators into the model for additional insights. During MGA we found that the importance of EWP and HAS been more in the groups with higher WE, but it was the opposite in the case of CPA. These findings are comparable to past researchers who reported that employees with high experience and tenure look forward to participative contribution through their deep knowledge accumulated over time if their desires are fulfilled (Maden, 2014), which aren't just pay or promotion (MacArthur, 2019). The increased experience adds to creativity, imagination and broad-mindedness in decision-making (Okpara, 2007). However, for Gen-Y salary and benefits are more important (Ying et al., 2017).

In the case of JH (H9), we observed that EWP leads to JS in loyal employees. Similarly, JS leads to ER, and the effect was more pronounced in the group of loyal employees. These results are in tune with the findings of Khalid and Nawab (2018), who reported that ER is positively influenced by all types of EWP and this feeling of ownness and oneness with the organization grows with tenure (MacArthur, 2019), and age is negatively related to the job-hop frequency (Steenackers, 2016).

5.1 Theoretical implications

The current study is theoretically anchored in the SET, which is regarded as a foundation for employer and employee interactions in the context of HRPs and ER (Coyle-Shapiro and Conway, 2005). Researchers are recommending SET to effectively describe the dimensions of HRPs (Piasecki, 2019). In this context, this research has various theoretical implications, firstly, this research established that not all the HRPs have a significant positive impact on the JS and ER. Our results indicate that out of all the HRPs, CPA (t = 9.196) has the highest positive influence on JS followed by EWP (t = 5.304). Whereas, EWP (t = 2.456) has the highest positive influence on ER followed by GRH (t = 2.314). The second significant contribution of this work is the identification of the direct and mediating effects of JS between HRPs and ER. To the best of our knowledge, this is the first study that has tested these constructs in the context of the textile industry. Here, the current research establishes that JS has a strong positive influence on ER, and it acts as a full mediator between the CPA and ER and exhibits partial mediation between EWP and ER. The results also establish the absence of any mediating effect of JS between HRPs like GRH, HAS and TAD and ER. Finally, the research confirmed the moderating effects of WE and JH.

5.2 Managerial implications

The study's findings provide several potential implications for marketers about employee retention in textile firms concerning HRPs and JS. Based on the results of PLS-SEM we delineate the HRPs that have a positive impact on JS and ER. As per the results of the study, we recommend that textile manufacturing companies pay more attention to HRPs like CPA and EWP to enhance JS. Specifically based on the top three high factor loadings (please see Tables 3 and 4) we propose managers improve CPA by ensuring that performance appraisal is handled without any favoritism (CPA3 = 0.785), provides an opportunity for self-review and reflection (CPA4 = 0.783) and the data is used for employee development decisions (CPA6 = 0.763). Similarly, to enhance EWP, the managers should hold regular meetings and discussions with employees (EWP1 = 0.806), involve employees in the problem-solving and decision-making process (EWP2 = 0.784) and empower them with independence to complete the assigned job (EWP3 = 0.789). On the other hand, we highly recommend managers ameliorate EWP, GRH and JS to improve ER. We have already highlighted the important aspects of EWP, hence here we propose important dimensions of GRH and JS based on high factor loadings. To build on GRH, managers should create a formal mechanism for grievance handling (GRH1 = 0.806), take disciplinary action in case of severe mistakes (GRH4 = 0.772) and handle work-related issues and grievances in a timely and effective way (GRH2 = 0.741). In specie to JS, managers should ensure that employees receive the right amount of recognition for their work (JS6 = 0.803), employees are satisfied with the financial incentives (JS2 = 0.795) and the management is concerned about the wellbeing of employees (JS7 = 0.776). The second important implication is derived through the mediation analysis. We could notice that JS is not mediating the relationship between GRH, HAS, TAD and ER. However, we found a full mediation at the CPA→JS→ER link, hence we strongly recommend the managers give high attention to CPA and JS to retain their employees. Another successful positive mediation effect was noticed at the EWP→JS→ER link, although it was a partial mediation. As per this result, we suggest textile manufacturing companies involve their employees in various work processes to enhance or maintain their satisfaction and retention levels. In summary, improving JS will indirectly benefit the companies as it mediates and helps create a positive influence of CPA and EWP on ER. The third set of significant implications was derived through the moderation analysis based on WE and JH. We observed that CPA leads to ER and JS in the case of relatively fresh employees than those with higher experience. Hence, we recommend textile companies offer suitable pay structures, financial returns, tangible service and benefits; and fairness in organizational decisions like pay determination, promotion and talent pool to new and less experienced employees. On the contrary, EWP leads to JS and ER in comparatively experienced employees. Therefore, we recommend managers concentrate on sharing authority and responsibility among experienced employees to inculcate the feeling of progress, satisfaction, belongingness and commitment. This will also help the organization in developing future executives. Based on our findings we urge the managers to be watchful in terms of GRH for mid-experience employees (4–6 years). These employees may develop some grievances over time, and a timely redressal will lead to JS and ER. Managers should attend to the mental, physical and social well-being of the high experience employees (7–9 years) as it leads to JS and ER. It is quite evident that with tenure HAS becomes prudent for the employees. Since CPA leads to JS and ER for all categories of JH, we strongly recommend fortifying CPA. On the contrary, EWP was found significant for employees who never changed their job. It indicates that these employees wish to actively participate in organizational activities. Involving these employees will lead to better JS and ER.

6. Limitations and future research directions

Due to the country-level context, the generalizability of the findings could be constraining, and future researchers can undertake a cross-cultural study. Secondly, the study is based on cross-sectional data, longitudinal research can overcome the predictive limitations of the current study. Third, we have employed a quantitative approach to extrapolate patterns and trends. Fourth, the HRPs adopted in the present study are not exhaustive and have a scope of variation as per the need of other industries for future studies. Fifth, we used post hoc tests to detect CMB, future studies may include an a priori approach such as marker variable. Finally, we suggest a qualitative or a hybrid study in the future for in-depth analysis.

Figures

Figure 1

Research model

Figure 2

Final model

Table 1

Studies on HR practices, job satisfaction and employee retention

Authors and year	Independent variables	Mediators	Moderators	Outcome variables	Respondents (sample size)	Country	Industry	Technique
Ma et al. (2016)	HR practices (Commitment and control)		Type of organization	Job satisfaction and turnover intentions	Professionals (311)	China	Mixed	T-test, Hierarchical regression
Dechawatanapaisal (2018)	Performance management, training, rewards, career development. Employee involvement, and information sharing	Organizational job embeddedness	Job satisfaction	Quit intention	Accountants (1,028)	Thailand	Corporation	CFA, multiple regression
Mahmood et al. (2019)	Salary, Job enrichment, Job stability	Job satisfaction		Employee commitment	Non-managerial employees (263)	Pakistan	Banking	CB-SEM
Piasecki (2019)			HR differentiation (Content, stability, strength) and Number of segments	Job satisfaction, higher affective commitment and lower turnover intentions	Bank employees (978)	Poland	Banking	Hierarchical linear modeling
Amah and Oyetunde (2019)	HRM practices		Ethnic similarity or difference	Job satisfaction and affective commitment	Employees (450)	Nigeria	Mixed	CB-SEM
Cherif (2020)	HRM and employee job satisfaction			Organizational commitment	Bank employees (330)	Saudi Arabia	Banking	Correlation and multiple regression
Park and Doo (2020)	Organizational culture	HR practices		Job satisfaction and organizational commitment	Korean Women Managers (230)	South Korea	Mixed	CB-SEM
Coudounaris et al. (2020)	Pay level, pay rise, benefits and pay structure/administration	Job satisfaction		Turnover intentions	Nurses (163)	Ghana	Healthcare	CFA, CB-SEM
This study	Compensation and performance appraisal, employee work participation, grievance handling, health and safety and training and development	Job satisfaction	Work experience and job hopping	Employee retention	Administrative employees (365)	India	Textile	PLS-SEM, MGA, Mediation analysis

Source(s): Authors' elaboration

Table 2

Demographic characteristics of the sample

Characteristics	N	%
Gender
Male	245	67
Female	120	33
Marital status
Single	92	25
Married	273	75
Age
Below 25	30	8.2
26–35	155	43
36–45	151	41
46 and above	29	7.9
Work experience
Less than 3 years	98	27
4–6 Years	175	48
7–9 Years	92	25
Frequency of job hopping
Never	116	32
Once	123	34
Twice	126	35

Source(s): Authors' findings

Table 3

Measures

Construct/Source/Items
Compensation and performance appraisal
Arthur (1994) and Subramaniam et al. (2011)
CPA1	Performance is appraised regularly
CPA2	Appraisal systems are well documented and discussed
CPA3	Seniors handle appraisal without any favoritism
CPA4	The appraisal provides an opportunity for self-review and reflection
CPA5	Appraisal system has scope for helping employees to discover their potential
CPA6	The HR department uses appraisal data for employee development decisions
CPA7	Appraisal facilitates the growth and learning of employees
CPA8	Fair compensation is paid
CPA9	Benefits like provident fund and gratuity are provided
CPA10	Employees can take loans and advance money
CPA11	Higher compensation is paid as compared to other similar organizations
CPA12	Increments are as per industry norms
CPA13	Economic security is given through regular employment
Employee work participation
Bhatti and Qureshi (2007), Khalid and Nawab (2018) and Koch and McGrath (1996)
EWP1	Regular meetings and discussions are held with employees
EWP2	Employees are involved in the problem-solving and decision-making process
EWP3	Independence in thought and action is provided to complete the assigned job
EWP4	Employees feel comfortable expressing their views and suggestions
EWP5	Seniors promote an atmosphere of teamwork
EWP6	The organization sometimes provides flexibility in working hours to accommodate personal needs
EWP7	HR Policies believe in employee development
Employee retention
Mobley et al. (1978) and Khalid and Nawab (2018)
ER1	I talk of this organization as a great place to work
ER2	I feel concerned for the future of this organization
ER3	If I have to choose again, I will prefer to work for this organization only
ER4	“Interest and Skill Based” work assignments act as a stronger retention tool
ER5	I am satisfied with the working environment
ER6	I do not have any intention to leave this organization
ER7	This is the best of all possible organization to work with
ER8	I am able to maintain work-life balance
ER9	I feel loyal and committed to this organization
Grievance handling
Bhatti and Qureshi (2007) and Koch and McGrath (1996)
GRH1	A formal mechanism exists for handling grievances
GRH2	Work-related issues and grievances are handled timely and effectively
GRH3	Management believes the termination of the services of the employee as a last resort
GRH4	Disciplinary action is taken for committing severe mistakes
Health and safety
Macdonald and Macintyre (1997)
HAS1	Adequate welfare facilities and safety arrangements are available
HAS2	Health and safety policy is available and communicated
HAS3	The welfare officer is appointed with overall responsibility for health and safety
Job satisfaction
Macdonald and Maclntyre (1997) and Mahmood et al. (2019)
JS1	Working conditions are good
JS2	I am satisfied with the financial incentives
JS3	I feel a strong sense of belonging with this organization
JS4	The organization inspires the best in me in the way of job performance
JS5	All groups of the workforce are equally dealt with (age, gender, race, religion)
JS6	The right amount of recognition is given for my work
JS7	Management is concerned about the wellbeing and satisfaction of employees
JS8	I am satisfied with the leave policy
JS9	Salary is fair considering what others are paid
Training and development
Arthur (1994) and Subramaniam et al. (2011)
TAD1	Training programs are well structured and widely shared
TAD2	Induction training helps new joiners to learn in detail about the organization
TAD3	Training programs aim at developing the overall personality
TAD4	On-the-job training is provided as and when required

Source(s): The authors

Table 4

Results of the measurement model

Items	Loadings	VIF	CA	CR	AVE
CPA1	0.69	1.934	0.928	0.938	0.538
CPA10	0.71	1.9
CPA11	0.738	2.355
CPA12	0.725	2.025
CPA13	0.722	2.081
CPA2	0.671	1.914
CPA3	0.783	2.271
CPA4	0.785	2.501
CPA5	0.734	1.993
CPA6	0.763	2.219
CPA7	0.753	2.334
CPA8	0.723	2.031
CPA9	0.728	2.232
EWP1	0.806	2.449	0.875	0.904	0.573
EWP2	0.784	2.188
EWP3	0.789	2.261
EWP4	0.766	2.215
EWP5	0.76	1.91
EWP6	0.695	1.832
EWP7	0.69	1.505
ER1	0.837	2.248	0.839	0.882	0.557
ER3	0.769	1.881
ER5	0.7	1.572
ER6	0.668	1.615
ER7	0.81	2.082
ER8	0.675	1.451
GRH1	0.806	1.714	0.752	0.843	0.574
GRH2	0.741	1.48
GRH3	0.709	1.278
GRH4	0.772	1.458
HAS1	0.851	1.625	0.708	0.837	0.633
HAS2	0.69	1.238
HAS3	0.836	1.523
JS1	0.681	1.55	0.879	0.904	0.543
JS2	0.795	2.385
JS3	0.621	1.452
JS4	0.71	1.716
JS5	0.72	1.733
JS6	0.803	2.395
JS7	0.776	2.085
JS9	0.773	2.167
TAD1	0.771	1.55	0.781	0.859	0.604
TAD2	0.804	1.648
TAD3	0.781	1.581
TAD4	0.75	1.424

Note(s): Compensation and performance appraisal (CPA), Employee work participation (EWP), Employee retention (ER), Grievance handling (GRH), Health and safety (HAS), Training and development (TAD), Variance Inflation Factor (VIF), Cronbach's Alpha (CA), Composite Reliability (CR), Average Variance Extracted (AVE)

Source(s): Authors' findings

Table 5

HTMT ratio results indicating discriminant validity

	CPA	EWP	ER	GRH	HAS	JS	TAD
CPA	1
EWP	0.85	1
ER	0.794	0.851	1
GRH	0.822	0.825	0.756	1
HAS	0.786	0.734	0.667	0.713	1
JS	0.856	0.873	0.883	0.727	0.711	1
TAD	0.727	0.656	0.589	0.678	0.686	0.61	1

Source(s): Authors' findings

Table 6

Summary of path analysis

Hyp	Path	Path coeff	St. dev	t-value	p-value	Result
H1a	CPA → JS	0.596	0.065	9.196	0.000***	S
H1b	CPA → ER	0.04	0.095	0.453	0.651	NS
H2a	EWP → JS	0.335	0.064	5.304	0.000***	S
H2b	EWP → ER	0.274	0.111	2.456	0.014**	S
H3a	GRH → JS	−0.024	0.047	0.626	0.532	NS
H3b	GRH → ER	0.119	0.051	2.314	0.021**	S
H4a	HAS → JS	0.024	0.046	0.554	0.579	NS
H4b	HAS → ER	0.008	0.046	0.191	0.849	NS
H5a	TAD → ER	0.018	0.051	0.36	0.719	NS
H5b	TAD → JS	−0.04	0.054	0.811	0.418	NS
H6	JS → ER	0.438	0.091	4.745	0.000***	S

Note(s): S=Supported, NS=Not supported

*** significant at 1%, ** significant at 5%

Source(s): Authors' findings

Table 7

Results of mediation analysis

Hyp	Path	O	M	St. dev	t-value	p-values	Result
H7a	CPA → JS → ER	0.229	0.228	0.054	4.254	0***	S (FM)
H7b	EWP → JS → ER	0.157	0.158	0.045	3.524	0***	S (PM)
H7c	GRH → JS → ER	−0.019	−0.017	0.02	0.959	0.338	NS
H7d	HAS → JS → ER	0.013	0.012	0.02	0.627	0.531	NS
H7e	TAD → JS → ER	−0.013	−0.01	0.023	0.547	0.585	NS

Note(s): O=Original sample, M = Sample mean; S=Supported, NS=Not supported, FM=Full mediation, PM=Partial mediation

*** significant at 1%, ** significant at 5%

Source(s): Authors' findings

Table 8

Multi-group analysis (MGA) for work experience (H8)

Path	t-value			p-value			Group differences
	3	2	1	3	2	1	2 vs 3	2 vs 1	3 vs 1
CPA → JS	1.09	5.32	3.70	0.27	0***	0***	0.03**	0.87	0.06
CPA → ER	1.12	4.38	3.98	0.26	0***	0***	0.06	0.97	0.07
EWP → JS	2.94	2.78	1.89	0***	0.01***	0.06	0.43	0.62	0.92
GRH → JS	1.67	1.96	0.98	0.09	0.05**	0.33	0.96	0.47	0.53
EWP → ER	2.76	2.95	1.84	0.01***	0***	0.07	0.34	0.60	0.83
GRH → ER	1.68	1.97	0.95	0.09	0.05**	0.34	0.94	0.49	0.49
HAS → JS	2.16	0.14	0.67	0.03**	0.89	0.50	0.10	0.55	0.03**
HAS → ER	2.20	0.14	0.67	0.03**	0.89	0.50	0.09	0.54	0.03**
TAD → JS	0.12	0.74	0.06	0.90	0.46	0.95	0.55	0.70	0.94
TAD → ER	0.12	0.73	0.06	0.90	0.46	0.96	0.58	0.71	0.94
JS → ER	18.23	12.23	15.60	0***	0***	0***	0.26	0.78	0.37

Note(s): Work experience (1 = < 3 years, 2 = experience of 4–6 years, 3 = experience of 7–9 years)

*** significant at 1%, ** significant at 5%

Source(s): Authors' findings

Table 9

Multi-group analysis (MGA) for job hopping (H9)

Path	t-value			p-value			Group differences
	3	2	1	3	2	1	1 vs 3	1 vs 2	3 vs 2
CPA → JS	2.67	3.56	6.03	0.01***	0***	0***	0.30	0.96	0.41
CPA → ER	2.32	3.84	6.26	0.02**	0***	0***	0.03**	0.82	0.11
EWP → JS	1.52	1.81	4.44	0.13	0.07	0***	0.27	0.67	0.65
EWP → ER	1.43	1.76	4.21	0.15	0.08	0***	0.06	0.60	0.42
GRH → JS	0.87	0.98	0.71	0.38	0.33	0.48	0.27	0.23	0.86
GRH → ER	0.75	0.95	0.69	0.45	0.34	0.49	0.30	0.24	0.92
HAS → JS	1.54	0.67	0.64	0.12	0.51	0.52	0.51	0.35	0.11
HAS → ER	1.35	0.67	0.63	0.18	0.50	0.53	0.76	0.35	0.15
TAD → JS	0.97	0.06	1.54	0.33	0.95	0.12	0.10	0.48	0.55
TAD → ER	0.86	0.06	1.54	0.39	0.95	0.12	0.10	0.47	0.67
JS → ER	5.36	14.74	24.21	0***	0***	0***	0***	0.49	0.02**

Note(s): Job hopping (1 = never change the job, 2 = once change the job, 3 = twice change the job) *** significant at 1%, ** significant at 5%

Source(s): Authors' findings