Abstract
The present study concentrates on how organizational justice influences trust and performance of employees in an organization. Trust level of employees is affected by how employees perceive justice in organizations and hence, it also affects the performance of the organization. It may be inferred that trust is a vital component in mediating the connection of organizational justice and organizational performance. The industry used for the present research is the software industry of Pakistan. A structured questionnaire was sent to 350 employees, randomly selected, working in various software firms in Punjab, Pakistan. Structural Equation Modeling - AMOS was applied for analyzing the data. The findings from the research revealed that trust played a strong mediating relationship between fairness and performance of the organization. The results provide useful insights for organizations, particularly the software firms of Pakistan since this study considers factors other than economic gain that may be more important to the employees in improving the performance of the organization.
Highlights
Retaining productive employees and maintaining their performance to an optimal level is a major challenge that organizations have to confront to stay in this competitive market place
Organizations are interested to know regarding the determinants of organizational performance since it helps them to increase the performance of their firm
The goal of the research was to explore the effect of organizational justice on organizational performance while trust played the role of a mediating variable
Summary
Retaining productive employees and maintaining their performance to an optimal level is a major challenge that organizations have to confront to stay in this competitive market place. A great responsibility lies on the shoulder of the managers to make their employees feel like an intellectual asset for the company and not a burden so that employees are retained for a longer time period (Pare, Tremblay, & Lalonde, 2000). For employees to stay committed with the organization, it is vital to create an environment where trust prevails. Huff and Kelley (2003) suggested that the capability of an organization to beat the competition is dependent on its ability to build an environment based on trust. Organizational trust is referred as a standing perception of confidence or hopefulness of employee to get fair treatment from organization in any future transaction (Cohen-Charash & Spector, 2001)
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