Abstract

Drawing on theories of social exchange and social information processing, we examined whether the influence of psychological contract breach on in-role performance and organization-directed citizenship behavior (OCBO) depends on work group climate levels, specifically procedural justice climate and power distance climate. The findings supported our hypothesis that psychological contract breach more strongly influences in-role performance and OCBO among members of units with favorable procedural justice climates. Support for a hypothesized moderating role of power distance climate was less conclusive. We discuss the implications of our model and findings for theories of employee–organization relationships and practice.

Highlights

  • During the last three decades there has been a surge in interest in how and why employees respond in different ways when they perceive that others fail to meet obligations established in a social exchange relationship (Colquitt et al, 2013; van Dijke et al, 2018)

  • We focus on the group context variables of procedural justice climate (Naumann and Bennett, 2000) and power distance climate (Yang et al, 2007), examining how they may moderate the relationship between PCB and in-role and extra-role behaviors

  • We argue that two group climate constructs, procedural justice climate and power distance climate, independently moderate relationships between PCB and performance and citizenship behaviors

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Summary

Introduction

During the last three decades there has been a surge in interest in how and why employees respond in different ways when they perceive that others fail to meet obligations established in a social exchange relationship (Colquitt et al, 2013; van Dijke et al, 2018). Scholars suggest that employees are increasingly prone to perceiving that their organizations failed to fulfill one or more of its implicit or explicit obligations to them as part of the employment relationship Such psychological contract breaches (PCBs, hereafter) may often be due to the increased need for organizations to utilize idiosyncratic contractual arrangements that maintain flexibility in changing business environments (Robinson and Morrison, 2000). Very often such breaches precipitate within the employee intense feelings of violation and diminished trust in the organization (Deery et al, 2006). These reactions to PCB can produce a wide range of employee responses that are not organizationally desirable, such as turnover and absenteeism, counterproductive behaviors, reduced organizational citizenship behaviors (OCBs) or worsened in-role performance (Zhao et al, 2007)

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