Does perceived psychological contract breach mediate HPWS and turnover intentions relation? An empirical enquiry

Abstract

HPWS which refers to bundle of inter-consistent HR practices is found to be leading to several employee related outcomes. However, the underlying mechanism of how HPWS leads to negative employee outcomes is still less understood. The issue is significant from HR perspective as it can enable devising suitable strategies to foster positive employee outcomes and avoiding the negative one. In this study, we investigate this issue by focusing on two negative aspects namely turnover intention and psychological contract breach. The psychological contract breach is proposed and tested as a mediator in HPWS and turnover intention (employee outcomes) relationship.  Data is collected using the survey approach from the employees of selected retail firms from Pakistan. Through the sampling approach, we generated a usable sample of 182. The findings indicate that HPWS links to turnover intention and perceived psychological contract breach among the retail sector staff. We found positive influence of perceived psychological contract breach on staff turnover intention. Furthermore, the perceived psychological contract breach partially mediates the relationship between HPWS and turnover intention. Overall, result implies that perceived psychological contract breach is an important aspect of work and should not be ignored by the HR and general management.

Keywords: High Performance Work System, Psychological Contract Breach, Turnover Intention, Pakistan.