Master Thesis Human Resource Studies. The influence of high commitment HR system on turnover intention at the individual level: a critical view

Transcription

1 Master Thesis Human Resource Studies The influence of high commitment HR system on turnover intention at the individual level: a critical view Student: T.P.M. Nipius Mentor: S.E. Beijer

2 Abstract Most of the research on the use of high commitment HR systems is done at organisational level and aims at positive outcomes. This research tries to critically research the influence of using a high commitment HR system on turnover intention at the individual level. More specifically, this study uses the perceptions of employees and adds a negative outcome, being increased turnover intention through an increased workload. This negative outcomes represents the negative perspective on high commitment HR system and counterbalances the positive perspective, where the use of a high commitment HR system leads to decreased turnover intention through an increased affective commitment. This research used questionnaires to gather data in multiple organisations, working in various sectors. The data was processed using multiple regression analysis. Furthermore, a Sobel (1982) test was used to check for the possible effects of the mediating variables. The results only support the positive perspective on high commitment HR system. For exploratory purposes, also the influence of the individual HR practices on the mediating and dependent variables was measured. The results on these effects support the additive character of a high commitment HR system and pleas for using a bundle, rather than individual practices. Despite not finding any significant results for the negative perspective, researchers and (HR) managers should not ignore a possible negative effect of using a high commitment HR system. HRM might be a wolf in sheep s clothing and should therefore always be critically observed. 1

3 Acknowledgments I would like to specially thank my parents for giving me the opportunity, freedom and support to successfully complete my master s program. Furthermore I want to thank my girlfriend, mentor and classmates for giving me the mental support and counselling when needed. Success consists of going from failure to failure without loss of enthusiasm. Winston Churchill ( ). British Prime Minister during World War II 2

4 Index 1.Introduction 4 2. Theory Concepts Turnover intention Affective commitment Workload High commitment HR system The direct effect of a high commitment HR system on turnover intention The positive perspective The negative perspective Method Research set-up and respondents Procedure Instruments Control variables Intraclass correlation Statistical analyses Results Individual HR practices Conclusion and discussion The positive perspective The negative perspective Individual HR practices Strengths and limitations Directions for future research Implications Literature Appendices Appendix I: Participating companies Appendix II: Unrotated factor loadings Appendix III: Scales in the questionnaire used in this research 47 3

5 1. Introduction Employees are one of the most important sources of competitive advantage (Barney & Wright, 1998; Guest, 1997). Motivating employees and keeping them committed to the organisation, are two of the most critical challenges organisations face today (Ferris, Hochwarter, Buckley, Harrell-Cook & Frink, 1999). The enhancement of employee motivation and commitment through the use of HR practices is widely acknowledged (Datta, Guthrie & Wright, 2005; Huselid, 1995). Recent research argues that high performance work practices (HPWP) and in particular high commitment HR practices affect such organisational outcomes by shaping employee behaviours and attitudes (Arthur, 1994; Huselid, 1995; Whitener, 2001). These behaviours and attitudes in turn have influence on the turnover intentions employees have (Griffeth, Hom & Gaertner, 2000). Yet, one of the flaws in research on HR practices is that the bulk of studies is based on managerial reports (Grant & Shields, 2002). This type of research does not allow for an examination of the ways in which individual employees may experience or react differently to HR practices (Gerhart, Wright & McMahan, 2000). Based on the upcoming tendency largely developed by Bowen and Ostroff (2004) to take on a multi-level approach to understand HRM, Wright and Nishii (2006) developed a process model of HRM in which employees perceive HR practices subjectively and may react differently to those practices (Nishii & Wright, 2008; Wright & Nishii, 2006). Perceived HR practices exist objectively, but must be perceived subjectively by each employee. Based on perceived HR practices, employees will react in one way or another and process the information in a way that guides their actions (Nishii, Lepak & Schneider, 2008). The aforementioned studies talk about single HR practices, but when a set of high commitment HR practices is bundled, literature speaks of a high commitment HR system. When a bundle of high commitment HR practices are used together they attain synergistic benefits through an interactive and mutually reinforcing impact (Huselid, 1995). Because of these synergistic influences, this research particularly focuses on high commitment HR systems rather than loose practices. As mentioned earlier, this research focuses on the individual level and how employees perceive the use of a high commitment HR system. Therefore, when high commitment HR system is mentioned, it is about how the individual employee experiences the high commitment HR system. Linking the significance of high commitment HR systems, commitment and the upcoming trend of research on the individual level, this research will focus on the relation between high 4

6 commitment HR systems and commitment at the individual level. In particular, this research proposes a positive effect of a high commitment HR system on the affective commitment of employees. Affective commitment is a type of organisational commitment developed by Meyer and Allen (1997) and argues that employees emotionally attach to the organisation and identify themselves with the organisation. This positive influence of a high commitment HR system on affective commitment in turn may lead to lower turnover intentions. Turnover intention is defined as the voluntary choice of an employee to leave an organisation (Dougherty, Bluedorn & Keon, 1985). It sounds plausible to assume that emotionally attached employees aren t planning on leaving the organisation. The meta-analysis of Griffeth, Hom & Gaertner (2000) confirms this assumption and poses that affective commitment is one of the best predictors of turnover intention. Turnover intention subsequently has been recognised as the immediate precursor of actual turnover (Tett & Meyer, 1993). There are many reasons for organisations to prevent employees from leaving the organisation, ranging from direct costs through the selection, recruitment and training of new employees (Dalton, Todor & Krackhardt, 1982) to indirect costs caused by reduced morale and the loss of social capital (Des & Shaw, 2001). Summarizing the above, high commitment HR practices positively affect affective commitment which in turn leads to lower turnover intention. However, where the above -like most research- focuses on positive results of HR systems, one could argue that these systems might also lead to negative outcomes. Ramsay, Scholarios and Harley (2000) state that although high commitment HR systems lead to higher organisational commitment, some critics argue that they also lead to negative outcomes such as workload. They base their proposition on the neo-fordist labour process approach (Aglietta, 1979; Prechel, 1994) which sees the fundamental aim of new management techniques as being to enhance workplace performance, but it eschews the assumption that this will go hand in hand with positive employee outcomes. (Ramsay, et al., 2000, p. 505). The approach Ramsay et al. (2000) posit, states that managers are constantly driven to find ways to make employees work harder, longer and/or more efficient in order to maximize labour input. To be precise, the labour process critique holds that, while the use of a high commitment HR system may be beneficial for employees, this system may also cause work intensification. Following the work of Ramsay et al. (2000), several authors argue that high commitment HR systems may lead to an increased workload employees experience (Danford, Richardson, Stewart, Tailby & Upchurch, 2005, Kumar, 2000). 5

7 Where decreased turnover intention through increased affective commitment would be a positive outcome, the negative outcome of increased workload might lead to higher turnover intentions. Employees, who experience that they have too much work to do or do not have the skills to successfully fulfil their job, might have higher intentions to leave the organisation (Jolma, 1990). Thus, the negative result of increased workload might lead to increased turnover intention. In summary, this article distinguishes two different perspectives. On the one hand a positive perspective where high commitment HR systems lead to lower turnover intentions through an increased affective commitment. On the other hand a negative perspective where high commitment HR systems lead to increased turnover intentions through an increased workload. These two perspectives are consistent with the optimistic and negative perspectives Peccei (2004) distinguishes. These perspectives will be further explained in the theoretical part of this study. As mentioned before, nearly all research on the linkages between HR practices and performance is related to positive outcomes such as satisfaction, motivation and retention. The literature review by Boselie, Dietz and Boon (2005) endorses this assumption. By adding the contradicting result of workload, as argued by the neo-fordist labour process approach, this research becomes of great scientific interest. It has to be said that there are empirical studies that also add negative outcomes of high performance work systems. Kroon, van de Voorde and van Veldhoven (2009) add the negative outcome of burnout to their research. The big difference compared to this study is the level of analysis. The research by Kroon et al. (2009) uses high performance work system as an organizational level construct, where this study sees high performance work system as an individual level construct. Also, the negative outcome of workload itself is interesting and an addition to the current literature. The empirical literature on negative outcomes of high performance work systems predominantly focuses on burnout (Kroon et al., 2009), job stress (Hochschild, 1997) and need for recovery (Sonnentag & Zijlstra, 2006). This research thus sees an increased workload as being a negative outcome of high performance work systems, therewith significantly adding value to the literature on high performance work systems. Furthermore, this research shifts the focus from the managerial perspective to that of the employee. As Gibb (2001) argues, this change of perspectives has several benefits. One benefit is that it can help to counteract the effects of managerialism in the evaluation of HR systems. Managerialism is defined as adopting a managerial perspective or worldview on defining and understanding HR and the value of HR 6

8 (Gibb, 2001). Another benefit is that research focused on the employees view can be a lever for re-introducing the human dimension to the study of HRM. Hence, the aim of this research is to investigate how employees at the individual level perceive the use of a high commitment HR system and how this will eventually influence turnover intentions through its influence on affective commitment and/or workload. The research question will be as follows: To what extent do affective commitment and/or workload mediate the relationship between a high commitment HR system and turnover intentions? The structure of this research is as followed. First, the used concepts and their relations will be discussed in the theoretical section. Then the method section will be presented followed by the results and discussion. 7

9 2. Theory This chapter will first define the used concepts, followed by the theoretical foundation for the two posited hypothesis. These two explanations will be divided in an equal amount of paragraphs since this research posits two different perspectives on the use of high commitment HR systems. 2.1 Concepts Turnover intention Turnover intention is defined as the voluntary choice of an employee to leave an organisation (Dougherty, Bluedorn & Keon, 1985). The reasons for leaving the organisation can range from negative work conditions to new career opportunities. There is a broad consensus in the literature that turnover intention is the immediate precursor of actual turnover (Tett & Meyer, 1993) Affective commitment Commitment can be divided into 3 categories, namely affective, normative and continuance commitment (Allen & Meyer, 1996). Affective commitment is the affective or emotional commitment towards the organisation, which leads to identification with the organisation and feeling pleased being member of the organisation. Because later research by Meyer and Allen (1997) argues that affective commitment is constantly related to outcomes such as turnover intention, this research will focus only on this type of commitment Workload Workload may be of two different types. The first is that of quantitative workload, where employees perceive that they have too much work to do, too many different things to do, or insufficient time to complete the assigned task (Glazer & Beehr, 2005). Alternatively, Glazer and Beehr (2005) define qualitative workload as the condition where employees feel they haven t got the ability to complete their jobs or that they don t have enough time to complete their tasks regardless of how much time they have. 8

10 In other words, workload can be defined as a stressor when the employee feels that he or she has too many responsibilities or tasks in a defined period (Cardenas, Major & Bernas, 2004) High commitment HR system In recent years, the concept of high performance work systems gained a lot of influence in the field of HR studies (Ramsay et al., 2000). A high performance work system is a bundle of HR practices which attains synergistic benefits through an interactive and mutually reinforcing impact (Huselid, 1995). Within the field of high performance work systems, some authors emphasize high involvement HR systems while others emphasize high commitment HR systems. High involvement HR systems concentrate on the improved possibilities for employees to take initiative, arising from their empowerment to take decisions (Lawler, 1986). High commitment HR systems focus on the reduction of turnover and costs through the reduction of control and monitoring. Important matter regarding the distinction between high involvement and high commitment HR systems is the nebulosity this distinction carries with it. As Evans and Davis (2005) posit, there is no real consensus on which HR practices belong to which HR system. Nevertheless, many studies regarding HR systems make the distinction and argue that HR practices associated with a high commitment HR system are more related to affective commitment. Therefore, making the distinction sounds plausible. Based on the above, focusing on a high commitment HR system is more relevant for this research (Lawler, 1986). Based on research by several authors (Appelbaum, Bailey, Berg & Kalleberg, 2000; Kroon et al., 2009; Pfeffer, 1998), this study suggests five HR practices as being high commitment HR practices. These practices are the most frequent and clearly specified, and comprise selectivity in hiring, employee development and career opportunities, rewards, performance evaluation and participation and communication. When bundled, these practices form a high commitment HR system. Selectivity in hiring is the recruitment of exceptional talented people in order to achieve human capital advantage (Boxall, 1996). Pfeffer (1994) argues that selectivity in hiring also has a symbolic function towards newly recruited employees. Employee development and career opportunities refer to keeping the knowledge, skills and abilities of employees up-todate to ensure quality and better performance. (Huselid, 1995). Reward is defined as the material and non-material rewards employees get in turn for their added value to the 9

11 organisation (Bartol & Srivastava, 2002). Performance evaluation should form the basis for the aforementioned practices of reward, development and career opportunities (Fletcher, 2001; Huselid, 1995). The last practice of participation and communication is deemed to affect employees by providing them tools to monitor their tasks (Huselid, 1995). 2.2 The direct effect of a high commitment HR system on turnover intention The use of a high commitment HR system enhances employee retention (Allen, Short & Griffeth, 2003; Huselid, 1995; Shaw, Delery, Jenkins & Gupta, 1998). Using a high commitment HR system in the benefit of employees, should obligate them to reciprocate in a positive way. Employees should experience that the organisation they work at, values their contributions and cares about their well-being. This in turn will lead to lower turnover intentions (Eisenberger, Fasalo & Davis-Lamastro, 1990). A high commitment HR system might also lead to a positive work climate, which in turn might result in lower turnover intentions (Way, 2002). Based on these empirical findings, it can be said that employees perceive the use of a high commitment HR system as being beneficial in multiple ways and therefore lowers their turnover intention. However, the direct relationship between high commitment HR system and turnover intention may be mediated by other factors. This research posits two different perspectives on the relationship between a high commitment HR system and turnover intention. One positive perspective with affective commitment as the mediating variable. The other perspective being negative, with workload as the mediating variable. 2.3 The positive perspective The path leading from a high commitment HR system to turnover intentions through affective commitment can be seen as the optimistic perspective on the impact of HRM on the employee well-being. Central to this view is the believe that HRM has a positive influence on employees. The use of a high commitment HR system leads to a more interesting work environment and increased empowerment. This in turn will result in more satisfied workers and more commitment from the employees (Peccei, 2004). The theoretical foundation for the relationship between high commitment HR systems and affective commitment can be found in the social exchange theory (Blau, 1964; Homans, 10

12 1961). This theory originally explained the stimulus responsible for the attitudes and behaviours that individuals share. Several decades later, Eisenberger, Huntington, Hutchison and Sowa (1986) extended this theory by suggesting that the theory of social exchange also explains the relationship between individuals and organisations. Employees form general perceptions of the treatment they receive. Thus, if employees perceive the support by an organisation as positive, they would be more willing to respond in positive work attitudes and behaviours. This will then result in a higher level of affective commitment from the employee (Nasurdin, Hemdi & Guat, 2008). Empirical research into the relationship between high commitment HR system and affective commitment is scarce, but is abundant per practice. Therefore all practices will be explicated separately. Selectivity in hiring may lead to employees having an higher sense of appreciation and commitment they receive from the organisation. This in turn may lead to the desire by employees to repay the organisation for this investment (Eisenberger, Fasolo & Davis-Lamastro (1990). Empirical research by Caldwell, Chatman and O Reilly (1990) support this prediction. Employee development and career opportunities should lead to employees perceiving training investments by the organisation as symbols of continued future employment. The resulting feeling of security and progress should lead to more commitment (Strober, 1990). Empirical research (Maurer & Tarulli, 1994; Tsaur & Lin, 2004) support this prediction. The concept of reward should be seen by employees as a form of support. In return, they should show commitment to the organisation (Fioroto, Bozeman, Young & Meurs, 2007). Empirical research by Florkowski and Schuster (1992) support this prediction. If performance evaluation is perceived as being fair by the employees, they should show a higher level of commitment to the organisation. This prediction is supported by empirical research by Folger and Cropanzano (1998). The final concept of participation and communication is supposed to increase commitment by engendering the perception that the organisation values contributions by employees (Guest, 1992). Empirical research by Kalleberg, Knoke, Marsden and Spaeth (1996) support this prediction. Summarized, the use of high commitment HR practices may lead to an increased affective commitment among employees. Since this research examines the use of a high commitment HR system instead of individual practices, it sounds plausible that the bundle of the abovementioned practices also lead to an increased affective commitment through their synergistic benefits (Huselid, 1995). 11

13 Committed employees are more likely to stay with the organisation and strive for the mission, goals and objectives of the organisation they work for (Meyer, Paunonen, Gellatley, Goffin & Jackson, 1989; Mowday, Porter & Steers, 1982). In the particular case of affective commitment, employees stay because they feel emotionally bonded with the organisation and can identify with it. They feel devotion, belongingness and stability (Meyer, Allen & Smith, 1993). The relationship between affective commitment and turnover intention has been thoroughly researched and validated in previous work (Iverson & Buttigieg, 1999; Mowday, Porter & Steers, 1982). The meta-analysis by Griffeth, Hom & Gaertner (2000) draws the conclusion that affective commitment is one of the best predictors of turnover intention. Affective commitment is negatively associated to turnover intentions (Meyer, Stanley, Herscovitch & Topolnytsky, 2002), which means that an increased affective commitment leads to a decreased turnover intention. Literature on the mediating role of affective commitment in the relationship between high commitment HR system and turnover intention is limited (SamGnanakkan, 2010). One of the few empirical researches on this matter however finds a mediating role of affective commitment on the relationship between high commitment HR system and turnover intention (Paré & Tremblay, 2007). If employees perceive that the HR system is implemented for their well-being, they will be more affectively committed to the organisation. This sense of belonging and identification will lead to employees being less intended to leave the organisation. All of the above leads to the following hypothesis: H1: The more an employee perceives that a high commitment HR system is used, the higher the employee feels affectively committed to the organisation, which in turn has a negative effect on the turnover intention the employee has. 2.4 The negative perspective As mentioned before, some authors (e.g., Appelbaum et al., 2004) argue that a high commitment HR system has a positive outcome for employees, whereas other authors like Ramsay et al. (2000), argue that a high commitment HR system might also have negative 12

14 outcomes such as increased workload. Peccei (2004) adopts these arguments and melted them into the pessimistic perspective on the impact of HRM on employee well-being. The use of a high commitment HR system enhances work intensification (Delbridge, Turnbull & Wilkinson, 1992; Fucini & Fucini, 1990). In combination with an increased surveillance (Barker, 1993) employees have less control, have to work harder and experience greater pressure. As Peccei (2004) expressed in a great way, HRM acts as an ideological smokescreen (p. 5). In sum, only employers and not employees benefit from the implementation of a high commitment HR system. Although empirical research on the relation between high commitment HR system and workload is scarce, some studies support the prediction that high commitment HR system relates to workload. For example, Kumar (2000) concludes that increased workload is one of the negative results employees experience from the use of a high commitment HR system. Research by Danford, Richardson, Stewart, Tailby and Upchurch (2004) confirms these findings. Employees with an increased workload may experience an increased turnover intention. The empirical research on this relationship is scarce and mainly focused on intended nurse turnover. These articles however do find a positive relationship between workload and turnover intention (Alexander, Lichtenstein, Oh & Ullman, 1998; Jolma, 1990; Zeytinoglu, Denton, Davies, Baumann, Blythe & Boos, 2007). The mediating effect of workload on the relationship between high commitment HR system and turnover intention is not thoroughly investigated. Therefore unfortunately there is no empirical foundation for the mediating effect of workload. Although the theoretical foundation is scarce for the negative perspective on the use of a high commitment HR system, several authors (Grant & Shields, 2002; Legge, 1995; Ramsay et al., 2000) plea for having a critical view on the influences a high commitment HR system has on individual employees. Therefore, the abovementioned findings lead to the following hypothesis: H2: The more an employee perceives that a high commitment HR system is used, the more workload the employee experiences, which in turn has a positive effect on the turnover intention the employee has. 13

15 All hypotheses leads to the following conceptual model: Positive perspective + Affective commitment - High commitment HR system - Turnover intention Negative perspective + + Workload Figure 1. Conceptual model 14

16 3. Method 3.1 Research set-up and respondents This study is quantitative and cross-sectional, since the collection of data was conducted at a single point in time (Baker, 1999). Data were collected by means of questionnaires. Ten students from Tilburg University handed out the questionnaires to managers and their employees. Because this research is done at the individual level, only the questionnaires filled in by the employees were used. The managers and their employees had to work at the same unit. All units consisted of at least five participating employees and one manager. In order to ensure total anonymity, the questionnaires were returned in closed envelopes. In the aggregate 534 employees participated. They were located in 74 units across 40 organisations. Appendix I shows more details about the type and size of the organisations. Before attending the different scales used in this research, some demographic variables will be explicated. The gender of the participants is almost equally divided, with males having a small majority (50.3%). The average age of the respondents is 38.1 years (σ = 11.1). The average hours worked per week is 34.0 (σ = 9.1). The employees work on average 6.2 years (σ = 6,9) in the unit and 9.9 (σ = 9.8) years in the organisation. The demographic characteristics are summed up in table 1. 15

17 Table 1: Demographic charateristics of the respondents (N = 534) Variable Gender Mean SD Minimum Maximum Age Men (in years) Women Total Weekly work hours Men (in hours) Women Total Organisational tenure Men (in years) Women Total Departmental tenure Men (in years) Women Total Procedure In order to reduce the large amount of variables exploratory factor analysis was used. By doing so groups are created among the inter-correlations of a set of variables (Pallant, 2005). The data in this research is suitable for factor analysis since the number of cases is large enough. Furthermore, the strength of the inter-correlations among the items is good enough for factor analysis. The number of factors for each scale is determined by the use of Cattell s scree test (Cattell, 1966). Appendix II shows the unrotated factor loadings of the scale items of the components. All the used scales had one component showing strong loadings. Furthermore, the reliability of the scales was checked for. Therefore the corrected itemtotal correlations must be higher than 0.30 and the Cronbach s alpha if item deleted should be lower than the Cronbach s alpha of the scale. All scales had Cronbach alpha (α) scores higher than 0.7, which confirms a sufficient internal consistency of the scales. Furthermore, content validity was indicated through the use of references to previous research. 16

18 3.3 Instruments Turnover intention Turnover intention was measured using the scale developed by Colarelli (1984). The scale consists of three items. Content validity of this scale was ensured by the literature from Wayne, Randel and Stevens (2006). An example of an item is: I frequently think of quitting my job. The items were measured using a 5-point Likert scale ranging from 1 = strongly disagree to 5 = strongly disagree. Some of the items had to be reversed. High commitment HR system The scale of high commitment HR system consisted of 29 items, divided into five HR practices: selectivity in hiring (4 items), employee development and career opportunities (7 items), reward (5 items), performance evaluation (5 items) and participation and communication (8 items). The content validity of the used items was affirmed by the literature from Kroon et al. (2009). Kroon et al. (2009) founded their scale on the scales from Boselie (2002), de Kok, Uhlaner and Thurik (2002) and Den Hartog and Verburg (2004). In order to assess the employee perceptions instead of the line manager ratings, the authors reworded the items. They measure to what extent employee agree that certain practices are used by the organisation they work for. An example of an item is: My department offers the opportunity to develop skills further. The perceptions by the respondents were based on a 5-point Likert scale ranging from 1 = strongly disagree to 5 = strongly agree. Workload Workload was measured using a shortened version of the original VBBA scale on workload by Van Veldhoven and Meijman (1994). The scale consisted of six items and an example of an item is: Do you have problems with the pressure of work?. The perceptions by the respondents were based on a 4-point Likert scale ranging from 1 = always to 4 = never. Content validity was confirmed by the literature (Van Veldhoven & Meyman, 1994) from which the scale was derived. Affective commitment Affective commitment was measured using three items derived from the scale developed by Allen and Meyer (1990). An example of an item is: I feel like a part of the family in this organisation. The perceptions by the respondents were based on a 5-point Likert scale 17

19 ranging from 1 = strongly disagree to 5 = strongly agree. Content validity was confirmed by the literature by Meyer & Allen (1990). 3.4 Control variables The model controlled for the variables of contract type (part-time versus fulltime), educational level (low, medium and high), age (in years) and gender (male or female). The choice of these variables is determined by the possible effect they have on affective commitment (Kroon et al., 2009), workload (Zeytinoglu et al., 2007) and turnover intention (Pfeffer, 1983). 3.5 Intraclass correlation Since all the variables were measured using individual employees within the same units, it is likely that their perceptions regarding the use of a HR system and the effects on affective commitment, workload and turnover intention are relatively similar (Bliese, 2000). Therefore it is important to take intraclass (ICC1) correlation into account (James, 1982) When data may be considered interval level, ICC1 can be used to measure inter-rater variability for two or more raters. ICC1 can be conceptualized as the ratio between-groups variance to total variance and is defined as the amount of variance in individual scores that can be explained by the unit (Bliese, 2000). ICC1 scores can vary between 0 and 1, respectively explaining 0 per cent and 100 per cent of the variance. The ICC1 score for high commitment HR system is 0.368, which means that 36.8 per cent of the variance is explained by unit membership. For affective commitment, workload and turnover intention these scores respectively were 23.8 per cent, 16.7 per cent and 10.9 per cent. The ICC1 scores are all quite high, which could plea for aggregation. However, there is no consensus on which ICC1 scores are problematic for performing research on individual level. Furthermore, the most important reason for not aggregating the data is theoretical in nature. This research focuses on how employees perceive the use of a high commitment HR system. Because perceptions occur within individuals, high commitment HR system is an individual level construct in this research (Shih, Chiang & Hsu, in Werner, In press). Although performing multilevel analysis would be better, the use of it is unfortunately not possible in this study. 18

20 Thus, this research is done at the individual level. However, the results from the ICC1 calculations should be taken into account. Therefore, this issue will be further discussed in the discussion chapter. 3.6 Statistical analyses The collected data was processed into SPSS In order to confirm or reject the hypotheses, hierarchical multiple regression analysis and path analysis were used. This type of analysis does require some demands to be met (Pallant, 2005). First of all, this technique requires a big simple in order to generalize. This requirement was met because of the sample of 534 respondents. Additionally, singularity was checked for, since high commitment HR system is a combination of other independent variables. Furthermore, attention was give to possible outliers, since multiple regression is very sensitive to them. Finally, the distribution of scores was checked by looking at normality, linearity and homoscedasticity using the residuals scatterplots generated by SPSS (Pallent, 2005). After the regression analysis, path analysis was used to check to what extent the hypothesis could be confirmed or rejected. A path model is a diagram that relates the independent, intermediary and dependent variables. A path coefficient is a standardized regression coefficient (beta) showing the direct effect of an independent variable on a dependent variable in the path model. In this research, a three-variable compound path is used. The high commitment HR system influences affective commitment and workload, which in turn influences the turnover intentions employees might have. The next step was to measure the mediating effect of affective commitment and workload. This was done by following four steps as set forth by Baron and Kenny (1986). In each step, the independent, mediating and dependent variable is included. The first step is to check whether the independent variable of high commitment HR system has a an effect on the dependent variable of turnover intention. In the second step, the independent variable of high commitment HR system is used as a predictor for the mediating variables of affective commitment and workload. The third step is to control the effect of the two mediating variables of affective commitment and workload on the dependent variable of turnover intention. In the fourth step, the remaining effect of the independent variable should decline or disappear when the mediating variables are included in the measurement. If all the steps are met, there is full mediation. If only the first three steps are met, then there is partial mediation (Baron & Kenny, 1986). 19

21 The final step in the statistical analysis was to perform a Sobel (1982) test. The Sobel (1982) test determines the significance of the indirect effect of the mediating variables by testing the hypothesis of no difference between the total effect and the direct effect (Preacher & Hayes, 2004). 20

22 4. Results Before performing the regression analysis, the Pearson correlation coefficients were conducted. These coefficients determine the direction and strengths of the relationships between the variables. The Pearson coefficients scores can be found in table 2, along with the means and standard deviations. None of the independent variables have a correlation equal to or greater than 0.7. This indicates that there is no question of multicollinearity. This important requirement was met, along with the other requirements for successfully performing multiple regression analysis. Table 2: Means (M), standard deviations (SD) and Pearson correlation coefficients (N = 534) Variable M SD HR Turnover Workload Affective System intention commitment Gender Age *** Educational level *** 0.09 ** 0.00 Weekly work hours ** *** Tenure in unit *** Contract type *** *** Affective commitment *** *** *** Workload Turnover intention High commitment HR system *** ***. Correlation is significant at the 0.01 level **.Correlation is significant at the 0.05 level *.Correlation is significant at the 0.10 level Using the standardized beta coefficients, the different variables were compared. As Baron and Kenny (1986) set out, the first step is to check whether the independent variable of high commitment HR system has an effect on the dependent variable of turnover intention. The results of the regression analysis shows a negative relationship between these variables (β = , t = , p < 0.01). Thus, the first step by Baron & Kenny (1986) is met. 21

23 The second step by Baron and Kenny (1986) is to use the independent variable of high commitment HR system as a predictor for the mediating variables of affective commitment and workload. In the case of workload, high commitment HR system does not have a significant relation with this variable (β = 0.059, t = 1.297, p = 0.195). The results do support the positive path of the conceptual model, the relationship between high commitment HR system and affective commitment (β = 0.414, t = 9.774, p < 0.01). So, the second step is partially met, since only the relation between high commitment HR system and affective commitment is significant (p < 0.01). The third step includes examining the relationship between the two mediating variables of workload and affective commitment and the independent variable of turnover intention. The effect of workload on turnover intention was not significant (β = , t = , p = 0.123). The effect of affective commitment on turnover intention however was significant (β = 0.211, t = 4.450, p < 0.01). Like with the second step, this third step is partially met, since only the relation between affective commitment and turnover intention is significant (p < 0.01). In the fourth step, the remaining effect of the independent variable of high commitment HR system should decline or disappear when the mediating variables of workload and affective commitment are included in the measurement. When the mediating variables of workload and affective commitment are controlled for in the regression analysis, the score on the effect of high commitment HR system on turnover intention decreases, but still exists (β = 0.184, t = 3.893, p < 0.01). This results in the last step of Baron and Kenny (1986) not being met, which in turn leads to the conclusion that there is partial mediation. Since step two only shows positive results for the positive perspective through the mediating variable of affective commitment, the partial mediation only accounts for this path. The results of the hierarchical multiple regression analysis are summarized in table 3 and also entered in figure 2. Also listed in table 3, are the R 2 scores. The R 2 scores tell how much of the variance in the dependent variable is explained by the model (Pallant, 2005). 22

24 Table 3: Results of the hiearchical multiple regression analysis (N = 534) Independent variable Model 1 Model 2 Model 3 Model 4 (Turnover (Workload) (Affective (Turnover intention) commitment) intention) 1. Gender ** Age Educational level *** ** *** 4. Contract type * *** *** 5. High commitment HR system *** *** *** 6. Workload Affective commitment *** R F (0.000) (0.000) (0.000) (0.000) ***. Significant at the 0.01 level **. Significant at the 0.05 level *. Significant at the 0.10 level *** Affective commitment *** High commitment HR system *** Turnover intention Workload ***. Significant at the 0.01 level **. Significant at the 0.05 level *. Significant at the 0.10 level Figure 2: Results of the multiple regression analysis entered in the conceptual model 23

25 Regarding the control variables, the contract type (β = , t = , p < 0.01) and educational level (β = , t = , p < 0.01) were of significant influence on the turnover intentions employees had. Both variables had a negative effect on the turnover intention, meaning that higher educated employees and fulltime employees had lower intentions in leaving the organisation than lower educated employees and part-time employees. Because hypothesis 2 could not be tested due nonsignificant scores, the Sobel (1982) test was only performed on hypothesis 1. The Sobel (1982) test determines the significance of the indirect effect of the mediator by testing the hypothesis of no difference between the total effect and the direct effect (Preacher & Hayes, 2004). The test uses the unstandardized beta coefficients and standard deviations of the relationships from regression analysis with the independent variable predicting the mediator and regression analysis with the independent variable and the mediating variables predicting the dependent variable. As elaborated earlier, only the positive perspective of the model showed significant results. Therefore the Sobel (1982) test was solely performed for the path from high commitment HR system to turnover intention, through the mediation of affective commitment. The unstandardized beta coefficients for this path were (a) and (b). The standard deviations respectively were (SD a ) and (SD b ). The results of the Sobel (1982) test show that affective commitment significantly mediates the relationship between high commitment HR system and turnover intention (z = 4.076, p < 0.001). Therefore hypothesis 1 is confirmed. a (SD a ) (0.053) Affective commitment b (SD b ) (0.056) High commitment HR system Turnover intention Figure 3: Sobel (1982) test 24

26 4.1 Individual HR practices As elaborated in the introduction and theoretical chapter of this study, the choice for a high commitment HR system rather than individual HR practices, is a deliberate one. For explorative purposes, this research also investigates the influence of the individual HR practices on the mediating and dependent variables. Because the results showed no effect of a high commitment HR system on workload, first the effects of the individual practices on workload is tested. As expected, none of the individual HR practices showed any significant correlations with workload. This outcome is strengthened by the results of the regression analysis, with none of the individual HR practices showing significant standardized beta coefficients. The results however did show other interesting results, as can be found in table 4. For instance, the degree to which employees experience the use of participation and communication had the highest correlation with affective commitment. This HR practice also had the highest correlation with turnover intention. The regression analysis strengthened these results, with only the practice of participation and communication having significant scores on affective commitment (β = 0.184, t = 3.637, p < 0.01) and turnover intention (β = , t = , p < 0.01). Table 4: Means (M), standard deviations (SD) and Pearson correlation coefficients (N = 534) Variable M SD Turnover intention Workload Affective commitment Selectivity in hiring *** Employee development and career opportunities *** *** Rewards *** *** Performance evaluation *** *** Participation and communication *** *** ***. Significant at the 0.01 level **. Significant at the 0.05 level *. Significant at the 0.10 level It is interesting to notice that the bundle of HR practices (the high commitment HR system) has better results than the individual HR practices. Of the individual practices only participation and communication had significant standardized beta coefficients on affective 25

27 commitment (β = 0.184) and turnover intention (β = ). These scores are significantly lower compared to the standardized beta coefficients on the effect of high commitment HR system on affective commitment (β = 0.414) and turnover intention (β = ). In the conclusion and discussion chapter, these results will be further discussed. 26

28 5. Conclusion and discussion This research concerned the influence of a high commitment HR system on turnover intention on the individual level. More specifically, this research distinguished two paths. One path representing a negative perspective (Peccei, 2004) where the use of a high commitment HR system might lead to increased turnover intention through the mediating variable of workload. Another path representing a positive perspective (Peccei, 2004) where the use of a high commitment HR system might lead to decreased turnover intention through the mediating variable of affective commitment. The empirical research by Allen et al. (2003), Shaw et al. (1998) and Way (2002) suggested a negative effect of high commitment HR system on turnover intention. The results in this research significantly showed a negative effect, which confirms the previous studies on this research. The employees perceived the use of a high commitment HR system in a positive way and therefore had less intention of leaving the organisation. This research expected two variables having a mediating effect on the relationship between high commitment HR system and turnover intention. To keep this chapter clear, the conclusion and discussion will be separated between the positive and negative perspective. 5.1 The positive perspective The first mediating variable was affective commitment. This variable represented the positive perspective of Peccei (2004) where employees perceive the use of a high commitment HR system as being positive. Through a more interesting work environment and increased empowerment, employees become more committed. The theoretical foundation for the relationship between high commitment HR system and affective commitment can be found in the social exchange theory (Blau, 1964; Eisenberger et al., 1986). Employees form general perceptions of the treatment they receive. If employees perceive a high commitment HR system as positive, they are more willing to respond in positive ways, such as a higher level of affective commitment (Nasurdin et al., 2008). These theoretical explanations can be seen in the results of this research. The use of a high commitment HR system resulted in a highly increased affective commitment among the employees. 27

29 The next part in the positive perceptive is the effect of affective commitment on turnover intention. The literature indicates that committed employees are more likely to stay with the organisation (Meyer et al., 1989). In the particular case of affective commitment, employees stay because they feel emotionally bonded with the organisation they work for (Meyer et al., 1993). This relationship has been thoroughly researched and led to the conclusion that affective commitment is one of the best predictors of turnover intention (Griffeth, Hom & Gaertner, 2000). The sample of this research supported these explanations, since there was a relative strong, negative effect of affective commitment on turnover intention. The question then arises whether this positive perspective as a whole was supported by the findings in this research. Therefore the indirect effect of affective commitment was tested for through the use of a Sobel (1982) test. The results in this research showed a significant mediating effect of affective commitment on the relationship between high commitment HR system and turnover intention. Therefore, the positive perspective on the use of high commitment HR systems has been confirmed. 5.2 The negative perspective The results from the sample unfortunately did not show significant results for the negative perspective where high commitment HR system leads to increased turnover intention through an increased workload. High commitment HR system had no significant effect on workload and workload had no significant effect on turnover intention. Therefore, testing the mediating effect of workload on the relation between high commitment HR system and turnover intention through the use of a Sobel (1982) test, was out of the question. Several reasons may underlie the absence of significant results on the negative perspective. Firstly, the empirical articles on the effect of a high commitment HR system on workload are mainly aimed at nursery. Of the cooperating organisations, only some of them work in the healthcare. Secondly, although the five practices in this research are deliberately chosen based on previous literature, there is no unanimous agreement on which HR practices a high commitment HR system should inhibit (Evans & Davis, 2005). It could be possible that other HR practices have higher effects on workload, than the HR practices used in this study. Thirdly and perhaps more important, this research does not address the substance of the HR practices. This matter will be clarified through the use of an example. For instance, the use of reward inhibits multiple aspects. Reward is defined in this research as the material and non- 28