Abstract
This study determines the relationship between types of employee participation (delegative, consultative, worker director, and worker union) on employee retention and the moderation of employee compensation in this relationship. The authors analyzed four types of employee participation, employee retention, and compensation in two major sectors of Pakistan ( n = 1,054): service ( n = 535) and manufacturing ( n = 519). Self-administered questionnaires were distributed to first-line and middle-level employees. After establishing the reliability and validity of the scale, descriptive statistics, correlation, univariate analysis, multiple regression analysis, and independent-sample t test were conducted. All types of employee participation influence employee retention positively in both sectors. Employee compensation moderated the relationship between types of employee participation and employee retention. Delegative participation had a stronger influence on retention as compared with other types in both sectors. This is the first quantitative study to examine the influence of compensation on the relationship between direct and indirect types of employee participation on employee retention in six industries (Cement, Pharmaceutical, Food and Beverages, Health Care, Banking, and Higher Education) of Pakistan. The authors extend previous research studies by using comparative analysis tools to generalize the results in South Asian organizations.
Highlights
In this era of hyperactive environment, the formulation and implementation of traditional human resource management (HRM) strategies and practices are not enough to retain talented workforce
To construct a comprehensive list of populations, we included the higher education institutes that are approved either by the Higher Education Commission of Pakistan; banks, cement, and food and beverage companies that are listed in Securities and Exchange Commission of Pakistan (SECP); health care that are approved by Pakistan Medical and Dental Association (PMDA); and pharmaceutical companies that approved by Drug Regularity Authority of Pakistan (DRAP)
The study was conducted to analyze the influence of types of employee participation practices on employee retention in manufacturing and services sector of Pakistan
Summary
In this era of hyperactive environment, the formulation and implementation of traditional human resource management (HRM) strategies and practices are not enough to retain talented workforce. Organizations are compelled to find gateways to be more adaptive, accommodative, and cooperative as the challenges and pressures of competition in the global changing markets are nerve breaking and highly intense (Park, Appelbaum, & Kruse, 2010). Taken in this context, combination of employee participation practices (e.g., delegation and consultation) and employee compensation can be a novel idea and unique methodology that could help organizations to achieve success and could outwit the competitors (Yukl, 2010). One is to reduce employee turnover and, second, to considerably reduce the associated expenses of hiring and training and orientation of the new employees (Iqbal & Hashmi, 2015)
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