Impact of performance appraisal justice on employee engagement: a study of Indian professionals

Abstract

PurposePerformance appraisal is one of the most important human resource management practices as it yields critical decisions integral to various human resource actions and outcomes. The purpose of this paper is to explore the relationship between perceptions of performance appraisal fairness and employee engagement in the Indian business context.Design/methodology/approachThe study was conducted in two parts. The first part explored the relationship between justice perceptions and a one‐dimensional conceptualization of engagement. The second part explored the relationship between justice perceptions and a three‐dimensional conceptualization of engagement. The relationships between justice perceptions and engagement were analyzed using zero‐order correlations and hierarchical regression analysis.FindingsThe study findings suggest a significant positive association between distributive and informational justice dimensions and employee engagement. Distributive justice and informational justice dimensions were found to have a stronger impact on employee engagement conceptualized as antipode of burnout.Research limitations/implicationsThe research was cross‐sectional and so any inferences regarding causality are limited. All responses on engagement and justice scales are from self‐report measures and it is likely that method variance inflated the relationships among these variables.Practical implicationsPsychometrically valid scales for performance appraisal justice and engagement were developed and tests of relationships between them have been established. The study suggests that distributive and informational justice perceptions during a performance appraisal session lead to enhanced engagement among employees.Originality/valueThe study tests the relationship between performance appraisal justice and employee engagement in the Indian context. A significant positive relationship between some performance appraisal justice dimensions and engagement has been established. To the best of the authors’ knowledge, such a study is the first of its kind undertaken in the Indian context.