MS Thesis
Breach of Psychological Contract and its impact on Organizational Identification and
Organizational Disidentification: Mediating role of Perceived Organizational Support
and moderating role of Equity Sensitivity
MUHAMMAD IRFAN RAZA
Reg # MM131057
MS (HRM)
Supervisor
Dr. S. M. M. Raza N.
DEPARTMENT OF BUSINESS ADMINISTRATION
FACULTY OF BUSINESS ADMINISTRATION & SOCIAL SCIENCES
MOHAMMAD ALI JINNAH UNIVERSITY, ISLAMABAD
i
Breach of Psychological Contract and its impact on Organizational Identification and
Organizational Disidentification: Mediating role of Perceived Organizational Support
and moderating role of Equity Sensitivity
By
Muhammad Irfan Raza
Reg # MM131057
Human Resources Management
An Honors Degree thesis Submitted to the Department of Business administration,
in the fulfillment of the MS/ M-Phil degree program Requirement
in the Faculty of Business Administration & Social Sciences
Muhammad Ali Jinnah University
Islamabad, Pakistan
January 2015
ii
Breach of Psychological Contract and its impact on Organizational Identification and
Organizational Disidentification: Mediating effect of Perceived Organizational Support
and moderating role of Equity Sensitivity
By
Muhammad Irfan Raza
Reg # MM131057
__________________________
Dr. S. M. M. Raza Naqvi
(Thesis Supervisor)
_______________________
(Internal Examiner)
_________________________
(External Examiner)
____________________________
Dr. Sajid Bashir (HoD)
(Management and Social Sciences)
___________________________
Dr. Arshad Hassan
(Dean, Management and Social Sciences)
DEPARTMENT OF BUSINESS ADMINISTRATION
FACULTY OF MANAGEMENT & SOCIAL SCIENCES
MOHAMMAD ALI JINNAH UNIVERSITY, ISLAMABAD
iii
Certificate
This is to certify that Mr. M. I. Raza A. has incorporated all observations, suggestions and
comments made by the external evaluators as well as the internal examiners and thesis
supervisor. The title of his Thesis is “Breach of Psychological Contract and its impact
on Organizational Identification and Organizational Disidentification: Mediating
role of Perceived Organizational Support and moderating role of Equity Sensitivity”
Forwarded for necessary action.
--------------------------------------
Dr. S. M. M. Raza Naqvi
(Thesis Supervisor)
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TABLE CONTENTS
CHAPTER 01...................................................................................................................................1
INTRODUCTION..............................................................................................................................1
1.1 Problem statement......................................................................................................................7
1.2 Research questions......................................................................................................................8
1.3 Research objectives.....................................................................................................................9
1.4 Significance of the study..............................................................................................................9
1.5 Theories supporting research study...........................................................................................11
1.5.1 Equity Theory......................................................................................................................11
1.5.2 Norms of reciprocity...........................................................................................................12
1.5.3 Social exchange theory.......................................................................................................13
1.5.4 Organizational Support Theory...........................................................................................14
CHAPTER 02..................................................................................................................................16
REVIEW OF LITERATURE................................................................................................................16
2.1 Psychological Contract:..............................................................................................................16
2.2 Psychological contract Brach:....................................................................................................17
2.3 Organizational Identification.....................................................................................................18
2.4 Organizational Disidentification.................................................................................................20
2.5 Psychological Contract Breach and organizational Identification/Disidentification...................22
2.6 Role of Equity Sensitivity...........................................................................................................26
2.7 Mediating Role of Perceived Organizational Support................................................................29
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Theoretical Model........................................................................................................................32
Identification of Variables/Keywords............................................................................................32
Conceptual Framework 2.1...........................................................................................................32
Hypothesis...................................................................................................................................33
CHAPTER 03..................................................................................................................................34
RESEARCH METHODOLOGY..........................................................................................................34
3.1 Research Methodology and Design...........................................................................................34
3.1.1 Research Design..................................................................................................................34
3.1.2 Population and sample size................................................................................................34
3.1.5 Instrumentation..................................................................................................................35
3.1.6 Data Collection Technique and time frame.........................................................................37
3.1.7 Data Analysis Tools.............................................................................................................37
3.1.8 Analytical techniques and tool used...................................................................................38
3.2 Reliability...................................................................................................................................41
CHAPTER 04..................................................................................................................................43
RESULTS.......................................................................................................................................43
4.1 Descriptive Statistics..................................................................................................................43
4.2 Correlation Analysis...................................................................................................................45
4.3 Regression Analysis....................................................................................................................48
4.4 Mediated Regression Analysis...................................................................................................48
CHAPTER 05..................................................................................................................................48
DISCUSSION AND CONCLUSION....................................................................................................48
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5.1 Discussion and conclusion.........................................................................................................48
CHAPTER 6...................................................................................................................................48
CONCLUSIONS, LIMITATIONS, RECOMMENDATIONS & DIRECTION FOR FUTURE RESEARCH..........48
6.1 Introduction...............................................................................................................................48
6.2 Conclusion.................................................................................................................................48
6.3 Limitations.................................................................................................................................48
6.4 Recommendations & Direction for Future Research.................................................................48
REFERENCES.................................................................................................................................48
QUESTIONNAIRE...........................................................................................................................48
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List of Tables
Table 3.1: Instrumentations……………………………………………………..……………37
Table 3.2: Sample Characteristics…………...………..………………………...……...….…38
Table 3.3: Scale Reliability…….………………………………………………...….……….41
Table 4.1: Descriptive Statistics………….………………………………………..…………44
Table 4.2: Correlation Analysis………….……….……………………………..……………47
Table 4.3: Regression Analysis for outcomes of PCB.………….……...…………….…...…48
Table 4.4: Mediated Regression Analysis………………….…………..….……….………...51
Table 4.5: Moderated Regression Analysis…….…………….……..…..………….………...53
Table 4.6: Moderated Regression Analysis…….…………….….….…..………….………...54
Table 4.7: Summary of Accepted/Rejected Hypothesis…..…..….…..…..……...…….……..55
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OBBREVIATIONS
PCB: Psychological Contract Breach
EQ: Equity Sensitivity
POS: Perceived Organizational Support
OI: Organizational Identification
OD: Organizational Disidentification
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ACKNOWLEDGEMENT
First of all, I would like to express my deepest gratitude to Dr. S. M. M. Raza Naqvi, the
supervisor of my Honor thesis, for her generous guidance on my work. Whenever I met any
challenges on my research, he was always patient to give advice to me. Her experiences in
research do not only bring me new insights, but also inspire me to carry out the thesis in a
great success.
Moreover, credits should also be given to my friends who assisted me to distribute and
collected questionnaires, and gave comment on my research design. Without their kindness,
this study could not be done in such a way.
Last but never the least; I would like to thank all the respondents for sharing with me their
information and points of view on the above mention titled. Their generous support is
undoubtedly the foundation of my study.
Muhammad Irfan Raza
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ABSTRACT
The purpose of this study is to investigate the relationship between breach of psychological
contract and organizational identification & organizational disidentification with mediating
role of perceived organizational support and moderating role of equity sensitivity. This study
was conducted in nonprofit organizations (NGO’s) of Pakistan. The survey was conducted on
different areas of Pakistan such as Islamabad, Rawalpindi, and some district of Azad Jammu
& Kashmir. Primary data was collected using questionnaires which consist of 5 point likert
scale as well as 7 likert scale for organizational identification and organizational
disidentification. The sample size of the study was two hundred and seventy three (273)
employees from various nonprofit organizations. The overall response rate was (67%).
Results show that psychological contract breach was negative and significant relate to
organizational identification and positive significant to organizational disidentification.
Regression analysis shown that perceived organizational support and equity sensitivity will
mediating and moderating the relationships. The current study found significant results. Out
of six hypotheses five are accepted and one is rejected. At the end of this study we will
discuss the discussion and conclusion, limitations and recommendations for future research
have been discussed.
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CHAPTER 01
INTRODUCTION
The concept of psychological contract initially rooted in psychological sciences. Argyris
(1960) was the first who discuss the concept of psychological contract, other researcher
further explore this concept like Schein (1980), Levinson et al. (1962) and most famous
Rousseau (1989; 1995; 2000). In literature the concept of psychological contract is widely
used and emerged in every field to understand what employee ready to offer organization and
in return what employee expect to received from organization. Employees works in
organization and they expect some unwritten promises in form of regards, esteem, self
identity from organization which are commonly known as psychological contract (Tijoriwala
and Rousseau, 1998).
In psychological contract literature psychological contract have two types; transactional
contract and rational contract (Millward & Brewerton, 1999; Roussseau 1990, 1995;
Millward & Hopkin, 1998). As name shown that Transactional contract are related to
financial matters so transactional contract are those contracts which are naturally in short
term and belongs to financial where as Rational contracts are long term and relate to other
organizational benefits not financial (Morrison & Robinson, 1997; Rousseau & McLean
Parks, 1993). In Transactional contracts employee receive compensation, wages and short
term guarantee from organization to compensate their work whereas Rational contracts are
socio emotional and employee show their commitment in the form of organization citizenship
behavior and identification of organization. On other hand organization give them training,
skills, job security and self esteem for gain organizational goals (Bunderson & Thompson,
2003). When organization fail to fulfill these perceptions of employees in the scope of
1
transactional or rational contract these create breach between employee – employer
(Morrison and Robinson, 1997) are known as breach of psychological contract.
Psychological contract breach occurs when between the relationships one party think or
perceives that other party has neglected him to provide their promises or commitment
(Rousseau, 1995). E.g workers think that employer is obliged to offer him personal capacity
building opportunities and if these promises does not fulfill by employer than breach will be
further strengthen.
Study of (Tyler and Lind 1992; Lind and Tyler 1988) discuss group value model which
suggest that breach will minimize the employees affiliation towards organization
(organization identification) and maximize the degree towards organization disidentification
or detach him selves from organization. Low degree of identification and high degree of
disidentification may be shown in large number of employees in their behaviors and attitudes
because of less time in building relationship (McHoskey 1999), abandon or defecting (Gunn-
thorsdottir et al. 2002), and create negative attitude to take revenge instant of corporation
(Meyer 1992).
Restubog et al. (2008) debate on organizational citizenship behavior and breach of
psychological contract, study propose that organizational identification and trust mediate
between psychological contract breach and organizational citizenship behaviors. Study of
Ashforth and Kreiner (2004) and Gibney et al. 2011 interpret correlations of the study show
that negative association between psychological contract breach and organizational
identification. There is positive and significant relationship shown between breach and
organizational disidentification (Ashforth & Kreiner 2004; Restubog et al. 2008; Gibney &
colleagues 2011). In generally, when psychological contract breach take place in employees
2
they feel that organization are not consider them as a valuable member and employees
distance himself from organization and take lesser interest in the organization.
Organizational support theory principally elucidates perceived organizational support
(Aselage & Eisenberger 2003; Eisenberger et al. 1986) on the basis of perceptions that
developed in their employees that employer values their considerations and welfare.
According to reciprocity norm (Gouldner 1960) and social exchange theory (Blau 1964),
perceived organization support relate positively with employee – employer relationship thus
it creates feeling of responsibilities in employees which help for organization to reach its
targets (Eisenberger & Rhoades 2002; Eisenberger et al. 2001). In positive viewpoint
organization handling with terms of fairness, good supervisory relation and job conditions
whereas employees hold good attitudes and behaviors in terms of affective organizational
commitment, increased OCB and decreased withdrawal through perceived organizational
support which helps organization to reach its goals (Eisenberger and Stinglhamber 2011;
Riggle et al. 2009; Eisenberger & Rhoades 2002; Eisenberger et al. 2001).
Organization favorable attitude for employees increase their affective commitment to the
employer (Eisenberger & Rhoades, 2002). Further POS fulfill employees socio-emotional,
association and support (Eisenberger, Sowa & Hutchison, Huntington, 1986; Eisenberger,
Armeli, Lynch & Fasolo, 1998) thus employees affective commitment will enhances
(Eisenberger and Rhoades, 2002; Rexwinkel, Rhoades, Lynch, Armeli, 2001; Bormann &
Birjulin, 1999; Shore & Liden, Wayne, 1997; Randall, Settoon, Cropanzano, , Bennett &
Liden, 1996; Guzzo, Noona & Elron, 1994; Tetrick & Sinclair, 1994; Shore & Wayne, 1993;
Shore & Tetrick, 1991; Eisenberger, Davis-LaMastro & Fasolo, 1990). Those employees who
believe that their organization will provide them little support will higher propensity to leave
their job (Allen, Shore & Griffeth, 1999; Griffeth & Aquino, 1999; Wayne et al., 1997;
Noonan & Elron, Guzzo, 1994). Whereas those employee who believe that their organization
3
have been support them well will performing better and lower tendency to leave the
organization. As a result POS will positively relate to the organization identification and task
performances (Wayne et al., 1997).
Social exchange theory and reciprocity norm theory will help us to analysis how POS
mediate between psychological contract breach and organizational identification and
organizational disidentification. POS is the valuable handling an employee received from
organization (Shore & Shore, 1995; Aselage & Eisenberger, 2003; Eisenberger, Hutchison &
Sowa, Huntington, 1986; Rhoades & Eisenberger, 2002). Perceived organization support is
essential element for employee to maintain their jobs effectiveness and execute their attitude
(Rhoades & Eisenberger, 2002; Huntington, Hutchison & Sowa, Eisenberger, 1986).
Literature identified a large number of compensations and desirable working situation which
are positive relate with perceived organizational support; e.g. employees skills development
(Wayne, Liden & Shore, 1997), autonomy in their jobs (Eisenberger, Cameron & Rhoades,
1999), friendly working conditions (Rhoades & Eisenberger, 2002). Favorable working
condition in organization will bridge psychological contract. When employees perceive that
these conditions are in positive way, they feel that employer respect values and work for their
wellbeing (Shore & Shore, 1995). In advance Kessler and Coyle-Shapiro (2002) commentary
on their study that when employer provide favorable environment or fulfill employee
contractual obligations will increase perceived organizational support.
When employee sense that their organization have been fulfilled their psychological contacts
(social-emotional) needs (Eisenberger et al., 1986), employee perceive that organization has
treated him in positive way. This link further built strong ideological exchange between
employee and organization (Aselage & Eisenberger, 2003; Kacmar & Witt & Andrews, 2001;
Witt, 1992). Eisenberger et al., (2001) further debate that this link that perceived
4
organizational support and psychological contract will increased employee’s acceptance,
reciprocity norm and exchange theory. As result perceived organizational support will
increase the employee identification, their affective commitment, perform their tasks
effectively and least turnover rate in the organization.
Present study also helps us to address the limitations, investigate, empirical & theoretical, and
outcomes of equity sensitivity. This study also focus on theoretical and empirical testimony
concerning with selected variables and influence of equity sensitivity on other dependent
variables. Equity sensitivity react different when work environment change, they hold
different characteristics and react according to these characters. In particular the nonprofit
organization environments makes more difficult to fulfill all premises that employees believe
that organization will provide them. As a result these believe or promises are strengthen the
psychological contracts where employees perceive that organization must fulfill their needs
and return employees give them their services (Rousseau 1995). In different phenomenon
various perceive psychological contracts has been breached, which results employee react
negatively to identify the organization and positively related to the organizational
disidentification. Through breach of psychological contracts employee react negatively and
their behaviors and attitudes falls towards negative mode and hence their performance also
decreases (Meta analysis, Zhao et al. 2007). This study may debate on that employees
generally response positively to organization identification and negatively identify the
organization when breach is happen.
Employer – employee relationships are critical process to understand the process to which
incorporate with employee – employer relationship. We further debate on organizational
identification which is negative and organizational disidentification which is positive relate
with breach. Negative attitude occurs when employee’s thinks that organizations are fail to
fulfill their welfare and does not importance their contributions. Further study also explores
5
the moderating and mediating role between breach and organizational identification &
disidentification.
Studying these theories we will be able to contribute literatures in existing body of
knowledge. Initially we research on breach of psychological contract which relate to the
social exchange theory, norms of reciprocity to explain the employee attitudes which are
either identify or disidentify the organization. Restubog et al. (2008) and (Tyler & Lind
1992, 1988) who discuss group value model and social exchange theory which can clarify the
breach to identifying and disidentifying the relationship. Secondly when psychological
contract breach has been discussed, few other literatures have study on psychological breach
of employee’s attachment to the organization as a contour of disidentification and
identification. Breach have also send a strong symbolic message to employees which identify
themselves as a valued member of organization (Restubog et al. 2008). In 2008 Restubog et
al. show that breach was negative relates with organization identification hence employees
trust was fully mediate between the relationships. In study of Restubog et al. (2008) examine
the association between organizational disidentification and breach. The mediating effect of
organizational support are explore within literature through study of K. L. Scott & W. T. Few
& T. J. Zagenczyk & Ray Gibney (2011) which explore relationship between identification
and psychological contracts with role of perceived organizational support in the collage,
university members. Than study the equity sensitivity as a moderator in the study belongs to
Scott W. Lester & Jill Kickul (2001) where the authors study the link among breach -
employee behavior & attitudes. With the help of these relations we will able to study and
further explore these links and add some literature in the existing body of knowledge.
6
1.1 Problem statement
In 21st century organizations undergone substantial changes to meet their challenges through
organizational support, fulfill employee’s psychological needs which create employees
identification towards organizations which ultimately enhance the performance, job
satisfaction and commitment of employees towards organizations and if employees beliefs
are not fulfilled by employer or organizational support are not given in a right direction
which create organizational disidentification which are harmful and employees distance
himself from the organization. In contexts of nonprofit organizations where employees are
psychological attached with organizations and mostly work in different communities, ICBs,
unions which are characteristics of collectivist environment (Hofstede, 2001) provide quick
response to affected peoples, IDP’s, provide faculties like health, education, wash, awareness
etc. in this situation employees are too much attached with organizations which perceived
psychological contract, perceived organizational support, on the bases of these employee
moderate their equity sensitivity which result in their performance, behavior and attitude
(Giardini & Frese, 2008; Fox, Tett, & Wang, 2005; Gibson & Barsade, 2007; Stankov, &
Roberts, 1998) either positive or negative which finally belongs to employees own their
organization or distance them self form the organization.
Individual has a unique sensitivity preference and use their sensitivity on fair and unfair
situations which are also affect on employee’s decision whichever positive or negative side.
This study will also useful in developing countries where grass domestic products and
economy growth rate is low. Employees are attached with society or organization with
different form; either financially or emotionally, and their reaction depend on either these
form which own or distance them self form organizations. Guerts et al.(1998) concluded that
when employee think that they are not treated fairly as compare to other co-workers or the
7
effort they have utilized, feelings of frustration and negative perceptions are created in their
mind. In organizations where employees don’t see any other opportunity, they start spreading
rumors, reduce their input and affect the outcome of organization, and employees are distance
themselves from organization as a result organization face different problems. In light of all
above discussion we found very common problem in our private sector organizations (ngo’s)
where employees distance them self form organization when their psychological needs are
not fulfilled by employer or vice versa which are ultimately produced different positive or
negative outcomes.
Hitherto the link between these variables has not to my knowledge, has not been explore in
the literature. To explore this gap between breach and organizational identification and
disidentification we conduct this study in private sector organizations (nonprofit
organizations). In Pakistani context no vital study has been investigated by the past researcher
in those areas. In this study we build our arguments on the basis of empirical and theoretical
study to test the all linkage and their role in the organization which add new dimensions and
figures in the existing body of knowledge.
1.2 Research questions
Keeping in mind that every individual have different assumption and beliefs and on the bases
of these assumption they own or disown their organization and react differently in fair or
unfair situation in the organization.
To understand this situation the aim of my research is
Ɋ: What is the interrelationship between breach of psychological contract, equity sensitivity,
perceived organizational support, organizational identification and organizational
disidentification?
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Ɋ: Does perceive organizational support will mediate between psychological contract breach,
organizational identification and organizational disidentification?
Ɋ: Does equity sensitivity will moderate the relationship between psychological contract
breach, organizational identification and organizational disidentification?
1.3 Research objectives
The key objectives of this research are
To find out impact of psychological contract breach on organizational identification?
To find out impact of psychological contract breach on organizational
disidentification?
To find out the mediating role of perceived organizational support between
psychological contract breach and organizational identification?
To find out the mediating role of perceived organizational support between
psychological contract breach and organizational disidentification?
To find out moderating role of equity sensitivity between breach of psychological
contract and organizational identification?
To find out moderating role of equity sensitivity between breach of psychological
contract and organizational disidentification?
1.4 Significance of the study
Present research will open new dimensions and direction to explore the new horizons in
psychological contract, identification and disidentification of organization. Present study is
unique in different dimensions. This effort develops an integrated model of organizational
identification and disidentification with breach of psychological contract. This study focus on
9
the relationship between psychological contract breach and its outcomes which are identify or
disidentify the organization. Further we examine the moderating and mediating role of equity
sensitivity and perceived organizational support which are very useful for organizations and
explore the further dimensions. variables of our current model are not directly studied by any
researcher specially in developing countries and the links between these variables are also
comparatively new will be fruitful for organizations and researchers in future to grasp these
gaps. This study was mainly important for organizations who recognize that how to fulfill
employees needs to meet to organizational challenges because satisfied employees are
blessing and gift for the organization while unsatisfied employees hurts the organization
badly.
In every culture employees holds different norms and beliefs, on the bases of these
employees react different in different environment. In nonprofit organizations where
employees are working in highly competitive environment and attached with organizations
either financially or emotionally and employees also beliefs that employer fulfill their
psychological needs, provide organizational support to achieve their organizational goals, if
these beliefs are not fulfilled by employer employees react either positive or negative way
which affect the organizational performance. Current study fruitful for all organizations
(ngo’s), through the use of these results organization will achieve their goals more
effectively. This study will also help to find out the behavior of employees and their
attachment or detachment towards organization and also immensely important for private
sector organizations and future researchers. By testing these variables it will be add new
aspects and dimensions in the existing body of knowledge.
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1.5 Theories supporting research study
1.5.1 Equity Theory
Through Equity theory we explain the employee behavior and attitude at work floor. Adam
(1965, 1963) presented equity theory. Inequity exists when one person perceives that their
outcomes to input ratio different from others ratio. Equity theory focuses on perception
whether it prevails in reality or not. Equity theory compares the degree of inequity by
comparing one’s ratio to others. This theory focuses on exchange relationship between where
employee gives input and gets output. He believes that equity motivate when fairness comes
between organization and coworkers. On the work floor equity structure based on the ratio
between inputs and outcomes, Input means contributions done by employees and outcomes
stand by organization doing for employees. (Koppes & Vinchur, 2011) study on job
satisfaction and motivation through the result of comparison of perceived employee inputs
and outcomes to the outcomes and inputs form organization. This model can be explained as:
Where OA and OB are organization side means outcomes and IA and IB are Input from
employee. In organizational context outcome may be psychological rewards, feedback,
support for administration or supervisor and salary etc (De Cooman, Hofmans, De Gieter, &
Jegers, & Pepermans, 2012) on other side input refer to commitment to the organization,
qualification, etc (Anderson, 1976). According to Adams (1963, 65) equity feeling outcome
of (1) comparison between inputs and outcomes for self to organization, and (2) comparison
between both ratio means self to other colleagues. When this ratios is unfair, inequity is
practiced, which further turn into conflict situation and burnout stress. When larger the
inequity the stress is higher, to reduce this stress organization should eliminate the inequity
11
which further belongs to organizational identification. Generally equity theory tested by
monitoring the reaction of employees in inequity situation by intentionally overpaying or
underpaying them (Landy & Conte, 2010; p. 375). In this situation when employee overpaid
would raise their performance and own their organization or quality and when underpaid
would lower down the performance and distant them self from organization.
This theory is used to measure the equity sensitivity. There are inputs and outputs in a
relationship inputs is what employee given to the organization and output means what receive
form organization when this situation happened employee react towards organizational
identification or disidentification. In general when employee inputs are high their
organizational identification is high and when output is low relative to other their
disidentification are happened.
1.5.2 Norms of reciprocity
Many of us ready or agree to help colleagues when he/she is under work pressure. People
remember and thanks to those who remembered their important days in his life. And many of
us have buying gifts for friend who remember last time during the illness. These are all
examples of norm of reciprocity. Norm of reciprocity is a social rule among people who
return some favors and other acts of goodness or response to positive action with other who
act as a positively (kind reward action) (Gouldner, 1960). This rule gives fair social exchange
and positive behaviors. Yet, norm can also be use as to gain unfair advantage. The norm of
reciprocity is that people will response to each other by returning fair for fairness and respond
unfair for unfairness. As a result this theory is important in exchange between input and
output ratio.
In literature we found two key elements of norm of reciprocity as either positive or negative
aspects. In positive the exchange of favors with favors and benefits with benefits with
12
individuals. This norm commits benefits or favor until he or she repays (Chen, 2009). This
positive reciprocity norm is normal in society when one person helps others expect good
feedback from other side. On other side negative norm is that when individuals act against
unfair or unfavorable treatments (Chen, 2009). In generally both type of reciprocity norm
either positive or negative emphasizes the return as other party react either fair or unfair
means. Studies show that individual who react crime or anger might more support the
reciprocity norm negatively to hostility by punishing or mistreatment. (Eisenberger, Lynch,
Rohdiek and Aselage 2004). Carlsmith, Robinson and Darley, (2002) conduct a research on
college students and most of them believe that punishment should be decide on seriousness of
the crime instant by set examples to preventing parallel crimes. This theory is more important
for mediating and moderator variables such as perceived organizational support and equity
sensitivity. In POS employees beliefs that employer give than all their promises in return of
his work and in equity sensitivity individuals act against fair or unfair situation which are
provide employee psychological contract which further own or distance himself from
organization. This theory assumes that when one employee gives some things to organization
it also expects reciprocation.
1.5.3 Social exchange theory
In 1958 George Homans explain Social exchange theory with his publication "Social
Behavior as Exchange". Social exchange define as the exchange among persons, less or more
reward, intangible or tangible or exchange of activity among two or more persons.
Further (Blau 1964) explain social exchange theory that person are mutual depends on each
other’s and when one person propose some things to other they expects reciprocate by other
party. In contexts of our present study social exchange theory is very important and widely
used in research. This theory is the most significant and mold theory for understand the
13
workplace behavior. We found their roots in the literature for last more than 10 decades
(Mauss, 1925; Malinowski, 1922), in anthropology Sahlins, 1972; Firth, 1967), sociology
(Blau, 1964) and social psychological studies (Kelley & Thibault, 1959; Homans, 1958;
Gouldner, 1960). Despite this many social exchange have different views and their relation
which creates sense of responsibility (Emerson, 1976). Social exchange theory are
interrelated and interdependent on person to person and interactions each other (Blau, 1964).
Social exchange theory also stress on interdependent transactions which alternatively
generate strong relationships, while this happened only under certain circumstances. Social
exchange theory has been explore different areas such as social power (Peterson, Molm, &
Takahashi, 1999), independence (Westphal & Zajac, 1997), networks (Cook, Molm, &
Yamagishi, 1993; Galaskiewicz, Brass, Greve, & Tsai, 2004), organizational justice
(Konovsky, 2000), leadership (Wayne, Liden, & Sparrowe, 1997) and psychological
contracts (Rousseau, 1995).
There is strong consequence of social exchange theory on breach of psychological contract
and its outcomes. Breach happen when individual received different in return what they
expect from employer or when there is a difference between employee perceived and
individual actually received from employer. This theory gives us how employees respond
when their psychological contract are broken and then further show its effects on
organizational identification and disidentification.
1.5.4 Organizational Support Theory
Organization support theory is that managers are concerned with their employee that they are
dedicated with organization and in return organization is focus on employees welfare and
care their contribution (Eisenberger et al. 1986). When this identification is given to
employees they approve their esteem and affiliation. Hutchinson, Sowa, Eisenberger, &
14
Huntington, 1986; ; Shore & Shore, 1995; Eisenberger & Rhoades, 2002) support and discuss
the social emotional needs of employees which increase their work efforts, change employee
perception which concern that their contributions valuable for the organization and
organization care about their well being. Such perceived organization support increase
employee satisfaction, their affective commitment, expectation towards organization and
improve their performance which help organization to reach their goals. The representative of
the organization are generally fair or unfair orientation towards employees which conflicting
the individuals motives (Eisenberger et al. 1986). In light of this, Levinson’s (1965) draw
organization support theory idea that every employee in the organization represents the
organization which gives the basic social exchange relationships between employer –
employee. With this in mind that such relationships provide organizational identification in
form of commitment and work effort which are coherent with reciprocity norm, such type of
support from employer’s employee compel to support and minimize the stress and conflict in
the organization which alternatively oblige employee to organizational identification
(Eisenberger et al. 2001; Gouldner 1960).
In literature social exchange has generously control on organizational support theory
Eisenberger et al. (1986) proposed socio-emotional need for esteem, regards and
recongnization are the important function of perceived organization support Armeli et al.
1998. Fulfilling of these socio-emotional needs reduce the organizational disidentification
like psychosomatic and psychological reactions when employee faces high work pressure
(Ilies et al. 2010; George et al. 1993). In general the gratification of these needs employee fit
himself into social identity from organizational membership (Fuller et al. 2006; Eisenberger
et al. 1986; Eisenberger and Rhoades, 2002). Organizational support theory is vital to
analysis the perceived organizational support variable. Which are further links between
breach of psychological contract to organizational identification and disidentification.
15
CHAPTER 02
REVIEW OF LITERATURE
When two parties’ beliefs that they have mutual obligations between employee and employer
or more than two parties (Rousseau and Tijoriwala, 1998) are define as Psychological
contract. When these obligations are not fulfill from organization and organization does not
perform according to the expectations of employees (Robinson and Morisson, 2000) are
referred to as breach of psychological contract
2.1 Psychological Contract:
Argyris 1960 was the first who initiate the concept of psychological contract. Psychological
contract was developed by organizational scholar Denise Rousseau that illustrates the mutual
perceptions and beliefs, and the informal relationship between employer and employee. They
discuss detailed practice and define their relationship between organization and employee.
This is conspicuous from the formal written agreements of employees, which mutually
identify their responsibilities and duties. Psychological contract are unwritten agreements
take place before the formal agreement between two parties, the employee and employer. The
contract start when selection process is began and two parties are not defining each other.
This process can be start through observation and signaling theory when employee receives
signaling from organization and construct expectation from organization according to their
own perception and through towards organization. Both parties construct unwritten promises
to gain mutual benefits.
Applicant becomes employee psychological contract link relationship among employee and
16
employer. Rousseau define in their work that ‘employee reciprocal exist between employee
and employer and employee assume responsibility from organization and their responsibility
towards organization’ Rousseau (1989). Rousseau also suggests that most employees want to
transactional relationship. (Levinson et al. 1962) define psychological contract that employee
– employer to share their assumptions and their contributions.
In 1993 two scholars discuss three type of psychological contract as promise, payment and
acceptance (Rousseau and Park, 1993). Promise is the first stage of psychological contract it
perceived in first interaction. In next step decide what is being offered to them as payment
and last when both first two are according to the employee it is accepted. Transactional
contracts and rational contracts are also discussed by (Rousseau & Park, 1993; Rousseau,
1989) in their research as type of psychological contract. Transactional contracts are refer to
wages, salaries and those are short term contract where as rational contracts are long term as
commitment, job satisfaction, and organization identification. Both are very important in
nature.
2.2 Psychological contract Brach:
Brach of psychological contract happens when employees in the organization perceived that
employers have failed to accomplish their promises or not deliver their beliefs. In breach
employee react as negatively, employee change their attitude and behavior in negative
manner. In psychological contract breach employee reduced loyalty to organization, reduced
organizational commitment and increase turnover intention (Hussain, 2013). Morrison and
Robinson, (1997) explain that employee in the organization perceived that organization will
fulfill their beliefs based on their perception, when these beliefs are not fulfill breach has take
place, this breach further strength employee to change their attitude and behavioral (Kraatz,
& Rous-seau, Robinson, 1994; Rousseau & McLean Parks, 1993).
17
Psychological contract breach is the situation when employee belief that organization fails to
fulfill their promises (Briner & Conway, 2002). Contract are define as positive way as trust,
sincerity to organization than these beliefs are not fulfill from organization it leads to breach
of psychological contract (Sykes, 1996). Psychological contract depends on individual
rational and transactional beliefs regarding promises so it is individual employee perceived
regarding effort and rewards and fair or unfair between them. Breach is happened when one
or more contracts are not fulfill form organization employee feel emotional experience that
breach has occurred (Morrison & Robinson, 1997).
Many researchers discuss psychologically contract and many of them has the similar
definition which composed of beliefs, assumption, expectations, reciprocity and obligations.
In light of these researcher Rousseau define psychological contract as it contain employees
beliefs in a reciprocity responsibility between employee and employer (Rousseau, 1989).
Researchers explain that it has a subjective nature that depends on the employee beliefs
regarding their own view of point that organization must fulfill them (Rousseau, 1989;
Bellou, 2009; Rousseau, 1995). In further Rousseau (1989) discuss in his study that contract
is essential element exist between employee and organization because it is essential to
mediate between job outcomes. Psychological contract begins when job applicant holds a job
in organization and their beliefs start comparison with other party (Hess & Jepsen, 2009).
2.3 Organizational Identification
Many researchers define organizational identification in the literature that identification is the
positive link with organization to fulfill the expected role, task, goal, performance,
organization citizenship behaviors, job satisfaction, commitment and tenure (Bartel, 2001;
Ashforth, 2001; van Knippenberg, 2000) which are alternatively benefiting both employee
and employer.
18
In literature many researcher examined the relationship between employee and employer and
define their relationship in term of identification of themselves in the work floor (Ashforth &
Mael, 1989; V. Knippenberg, Ellemers & Haslam, Platow, 2003; Pratt, 1998; Dutton,
Dukerich, & Harquail, 1994; Elsbach, 1999). Every member in organization identifies
themselves with organization in term of what organization though to present them. To
understand the concept of organization identification we must understand the concept of
organization fit. Organization fit define as work environment and individual match with each
other (Johnson, Kristof-Brown, & Zimmerman, 2005; French, Caplan, & Harrison, 1982;
Dawis, 1992; Muchinsky & Monahan, 1987). Characteristics of person may include
biological or psychological needs, goals, beliefs, abilities, and self esteem whereas
environmental characteristics include extrinsic and intrinsic rewards, cultural values, norms,
traditions and other characteristics of individual and collectives social environment (French et
al., 1982). Fit concept is very important in industrial and organizational psychological fields
(Edwards, 2008). It is measurement of self concept and perception of employee towards
organization (Mael & Ashforth, 1989; Pratt, 1998) constructs their perceived identification
which fit with commitment of the organization: individuals may recognize themselves
negative way whereas other may good fit with similar organizations and feel to good
reorganization and committed.
In last decades organizational behavior play important role to study the organizational
identification (Rousseau, 1998; Pratt, 1998; Whetten & Godfrey, 1998). At every level
individual, group or organizational level identification is very important implications. It has
found positive relation with ocb and performance whereas negative related to turnover
intentions (Rao, Bhattacharya, & Glynn, 1995; Tyler, 1999; Hinkle, Abrams & Ando 1998;
van Knippenberg, 2000; Mael & Ashforth, 1995; Pratt, 1998; Haslam, 2001; Griffeth, Wan-
Huggins, & Riordan, 1998; Bartel, 2001). Identification also holds quality of work and work
19
control (Ashforth,2001). Almost every organization results/outcomes are strongly attached
with employee perception either positive or negative. Many other researchers also discuss the
dark side of organization (Elsbach, 1999; McLean Parks, Dukerich, & Kramer, 1998; Michel
& Jehn, 2003) where employees hold negative feeling towards organization.
Male and Tetrick (1992) define psychological group of identification that they share their
common experience and characteristics with each other in the group Tetrick & Mael (1992).
In specific organizational identification certain group of people shares their perceived
experience of its failures or success (Mael and Ashforth (2001). Employee perceives
themselves as a member of this organization Rousseau (1998). Members identify themselves
with the organization when employee perceive that at least they are part of the organization
Kreiner and Ashforth (2004), it is the cognitive perception of individual member in group or
organization not behaviors results Gould (1975) in Mael and Tetrick (1992). In literature
researcher give lot of emphasis on organizational identification which is important
implications in organizational. Mael and Ashforth (1995) found that organizational
identification has positively relates to organization citizenship behavior and performance
which motivate employees. In healthcare sector employees likely to engage in extra role,
improve quality, identify themselves and minimize the cost of work Golden, Duckerich, and
Shortell (2002).
2.4 Organizational Disidentification
Many researcher works on other side of identification Ashforth (2001), Bullis and DiSanza
(1999), Dukerich et al. (1998), and Elsbach (1999) which are known as organizational
disidentification. Disidentification occurs when employee show their attributes and behaviors
negatively and perceived that he or she are not fit with the organizational environment and
resist to organization (Bhattacharya & Elsbach, 2001).
20
Individuals are opposed to some or all characteristics of their organization (Ashforth, 2001).
Ashforth (2001) also correlates disidentification positively with abuse, poor attention span,
and absenteeism (Ashforth, 2001). Disidentified employee retains poor attitude and
performance which promote negative norm and culture in the organizational environment.
Example is; if someone challenges the value and missions of the organization other party or
opponents who support these values and mission are ‘disidentify’ them. In disidentification
individual or group of peoples are disidentify with the organization as peoples are like or
identify in organizational identification. Disidentification is a opposing him selves from
organization not just for accidental or began with unfit with their environment Elsbach
(1999). Disidentification may be entitled with separation form organization’s mission, vision,
culture or norms frequently and force himself to separate her identity and reputation from
those organizations. Employees involve finding out objectionable aspects of the organization
which help them to psychological separation from organization.
It is very important that clearly define the identification and disidentification. Many scholars
discuss that identification is not opposite to disidentification. To clarify this discusses the
relationship between disidentification and identification. At initially they seem uni-
dimensional variable. In the past research (Elsbach, 2001, 1999; Ashforth, 2001; Di-Sanza &
Bullis, 1999; Pratt, 2000; Dukerich et al., 1998), disidentification and identification are
separate variable. Both are containing unique psychological state. Identification is typically
positive or connecting aspect of the organization from individual where as disidentification is
typically negative or disconnecting state of the organization from individual. Despite of this
the purpose of identification & disidentification to conserve the identity of the
organization,the environment and the fact that experience in time to time. The best example
coated by Elsbach’s (2001). He discusses the califormia legislative staff where every member
of legislative show identification or disidentification to the legislature and every member use
21
different tactics to recognize them self identification. They identify them self in policy
making process and distance them self for political matters, where identified himself for
politicking and disidentify with ordinary mechanics of law making.
In organization number of reason are seem to disidentify or unrecognized the organization
which will produced conflicts between member and organization and as a result turnover and
absenteeism are strongly occur in employees which are harmful for the organization. Results
show that cost of turnover is high (Griffeth & Hom, 1995). When disidentifying employees it
manager responsibility to minimize individual negative views towards organization. However
managers of the organization are not desire disidentification in their employees which are
harmful for the organization.
2.5 Psychological Contract Breach and organizational Identification/Disidentification
Many researchers conceptualize and debate on employee - employer relationship in a social
exchange relationship where the organization furnish employees with physical, mental and
social needs in exchange for employee roles to achieve its organizational goals (Rousseau,
1995; Eisenberger et al. 1986). This concepts depends on psychological contracts theory
which debates that unwritten employees beliefs, assumptions that organization must fulfill
regarding job security, training, promotion and other related factors which are not in written
contracts play a very important role in employee attitude for exchange relationship which
relate to organization effectiveness (Rousseau, 1995). Many studies suggest that employee’s
early experience with organization; experiences during recruiters and early socialization with
organization members begin to develop psychological contract promises or perceived
organization values (Rousseau, 1995). During passage of time employee interact with other
coworkers (Rousseau and Dabos, 2004) and supervisors (Rousseau, 2001) and further
develop psychological contact. Psychological contract is very important for redesigning
22
organizational structure, downsizing, technological innovation and change, outsourcing and
provide strength during difficult economic times (Robinson and Morrison, 2000).
The most important theories reciprocity norm (Gouldner, 1960) and Social exchange theory
(Blau 1964) are important to debate on the results of breach. Social exchange theory explains
through the gratification of employee’s contracts, which creates feelings of responsibilities
within entities to reach the organizational goals (Rousseau, 1995). Gouldner’s explain the
reciprocity norm (Gouldner, 1960) that individual entrust to help other individual who help
them which are a generalized moral norm. On the other hand the organization’s who not
fulfill perceived beliefs and assumption of employees which are further motivate employees
to seize negative organization related behaviors and minimize contributions towards
organization (Zhao et al. 2007) actually harmful for organization and give opportunity for
revenge (Bordia et al. 2008) and also withhold from customers (Bordia et al. 2010) this type
of act support the negative reciprocity norm (Gouldner, 1960), which are danger for other
party to take revenge from other party who treated negatively.
There is largely research evidences supported (Zhao et al. 2007) the instrumental approach
support by psychological contracts theory limit their power in some cases, particularly when
significance of psychological contract breach is naturally by symbolic (Restubog et al. 2008;
Fuller et al. 2003). Many different models are used and one of them is a group value model
(Lind and Tyler, 1988;1992) was develop to address the fact that behaviors of employees are
not mutually or equity perspectives which minimize workers efforts towards organization to
compensate their losses which accrue due to its actions. Unfair treatment and response
towards employees may be the products of their feelings which are result of the expense of
actual cost. Further, group value model propose group values which are used to treatment for
employees is important for individuals to perceived organization values or group values
because such treatment s creates symbolic worth of employee which is valuable member of
23
the organization or group. More further, fair or unfair treatment or just or unjust treatment
will be influence the perceptions of employees if or not he/she belong to organization as a
useful entity. In fact these perceptions have influence on employees which becomes
psychologically attached or separate from the organization (Tyler and Lind, 1988).
A research conduct and illustrate on the group value model that there are negatively relate
breach and organization identification and positively between breach and organization
disidentification and Zagenczyk et al. (2011a) Restubog et al. (2008). Both concepts are
similar and describe the function of organization membership that performs in employees self
concepts. Organization identification is a form where employees emerge their attributes and
redefine self concepts (Mael and Ashforth 1989). Dutton et al., 1994 also define identification
is likely when employees perceive that organization or group consider them as a distinct
entity or in a positive manner. Especially when employees look organization values, mission,
purpose etc. they likely perceive the organization in a positive manner and define their
attributes which are similar to those which are define by the organization. Further employees
perceive that organization consider them as a meaningful entity and distinguish themselves
from others, under this type of perception employees are likely to become psychologically
attached to organization. In organization contents this type of attachment is desirable because
when employees positively psychologically attached with organization become more attached
with organization and engaged in positive citizenship behavior and minimize the negative
intentions towards organization (Riketta, 2005).
When employees psychologically detach or separate themselves from the organization is
known as Organizational Disidentification (Ashforth and Kreiner, 2004). In other hands,
employee will disconnect from organization when they feel that they will stand direct
opponent side to those who defines the organization (Elsbach and Bhattacharya, 2001). As
identification is a distinct self concept occurs when organization provides positive and
24
distinct self concept to employees. Similarly disidentification occurs when employee perceive
that their value is different from organization and they believe that organization has a
negative reputation (Kreiner and Ashforth, 2004; Elsbach and Bhattacharya, 2001;
Bhattacharya and Elsbach 2002). Under such situation, disidentification enables employees to
separate or disconnect themselves from organization or groups and maintain their self-
concept. Thus disidentification among employees is high is not a desirable state because they
always impel employees to negative opinions regarding organization and employee share
their negative attitude to other coworker to leave the organization altogether (Kreiner and
Ashforth, 2004).
Although past literature (Restubog et al. 2008; Gibney et al. 2011; Ashforth et al. 2004) also
explores link between breach and identification and some past research also empirically
illustrate the importance of these variables and why these variable are interrelated. In today’s
breach of psychological contract is ordinary or inescapable within the organization (Rousseau
2001), it is important for us to understand why and who this variable in interrelated with
organizational identification and disidentification. It is also important for us to debate on why
breach influences on employee and change their attitudes, interventions and innovations can
be adopt and change the situations within employer – employee relationship (Zagenczyk et al.
2009).
In light of previous studies, I expect in my research that breach of psychological contract
would be negative related to organizational identification and positive relate to organizational
disidentification. When psychological contract breach occurs employee thinks that they are
not consider as a valueable members of his organization and separate themselves (Zagenczyk
et al., 2011a; Restubog et al., 2008). in identification, psychological contract breach will not
only produce feelings of rejection but also weaken the employee’s psychological attachment
towards organization also reevaluate what they believe and where they stand for, these type
25
of attachment may decrease the organization attractiveness, especially when employees are
responsible to initiate some steps within the organization. In other hand disidentification,
beach is lead employees to perceive organization negatively that their values are distinct and
opposite to the organizational values.
Hypothesis 1: There a negative and significant relationship between Psychological contract
breach and organizational identification.
Hypothesis 2: There a positive and significant relationship between Psychological contract
breach and organizational disidentification.
2.6 Role of Equity Sensitivity
In current research the moderating role of equity sensitivity is most interesting variable of this
study. Equity sensitivity proposes that every individual in the organization have unique
sensitivity to fair and unfair situations which are further force to change their attitudes and
behaviors according to the situations either positive or negative (King el at., 1993; Huseman
et al., 1987, 1985; Miles el at., 1989). This concept explore the perceptions of individuals
what is and what is not equal and then use the other source of information to react the unfair
situation (Miles, King and Day 1993). Individual’s equity sensitivity may be moderate
between the reactions of individual behavioral and emotional those pursue a breach of
contract (Morrison and Robinson, 1997). Equity sensitivity concept was studied by different
examiner that every individuals hold distinctive sensitivity in fair and unfair situation which
effect individual reactions & attitude, either positive or negative (King et al., 1993; Huseman
et al., 1987, 1985; Miles et al., 1989;).
Empirical and theoretical evidence show that in same inequitable situations equity sensitivity
react different with others (Kickul et al., 2005; Huseman et al., 1985; Jackson & Patrick
26
1991). Different studies has also link equity sensitivity to a extensive range of different work
attitudes, behaviors, beliefs, responsibilities and rights (Raja et al. 2004), violations of
contract and action policies (Walker et al. 2007; Kickul & Lester 2001), outcomes (Miles et
al. 1994), ethical behavior and attitudes (Mudrack et al. 1999), commitment and job
satisfaction (Mone and O’Neill 1998), efficiency in job (Burroughs and Bing, 2001), and
OCB (Restubog et al. 2007; Akan et al. 2009).
Adams’s (1963, 1965) original study the equity theory, organizational behavioral scholars
have dedicated lot of interest towards dimension of fair or unfair situation in the organization.
Every member in organization is much concerned about how much he or she gets (outcomes)
in proportion to how much he or she contributes (inputs) in the organization. In this situation
equity theory tells about the comparison the ratio of individual with another individual to
determine whether the situation is equitable. When things are inequitable or unequal then
employees are react differently.
Adam’s (1963, 65) explain equity theory that every individual have different sensitivity to
react different in fair and unfair situation. In light of this theory we explain the following
views: (i) individual wants to fair relationships (ii) compare outcomes and inputs to other
party (iii) show negative feeling or reaction when feeling inequitable condition (iv) try to
balance these situations. According to Adam theory it is universal phenomenon that every
individual compare their inputs and outcomes with other opponent. This situation experience
during inequity situation regardless of whether under-rewarded or over-rewarded of
outcomes. Adams (1965) also explains that inequity distress appears in both situations either
under rewarded or over rewarded (Tornow, 1971; Carroll & Dittrich, 1978). Huseman, Miles,
and Hatfield (1985, 1987) originally debate on equity sensitivity concept and more dynamics
of equity perceptions. Equity sensitivity may vary their perception when they compare their
outputs/input ration with other referent.
27
Huseman and his colleagues (1987, 1985) explain the three types of individual’s sensitivity to
equity which vary from individual to individual: (i) Benevolent (inputs greater than
outcomes), (ii) equity sensitive (those who seek equity preference, who seek balance their
inputs and outcomes with others), and (iii) entitled (outcomes greater than inputs) Huseman
et al., (1985, 1987).
Other than the management sciences equity theory used a number of other fields such as
expectations of consumer (Kurtz, Clow, and Ozment, 1998), one to one business marketing
(Boyd and Bhat 1998; Patterson, Spreng, and Johnson, 1997), customer suggestions and
complaints (Pinkerton and Lapidus, 1995), and pricing tag Monroe and Martins, 1994),
satisfaction of customers (Oliver and Swan, 1989), and relationship between seller – buyer
exchange (Arenson, Huppertz, and Evans, 1978).
This study further examines the breach of psychological contract (inequity form) which
reciprocally effect on equity sensitivity and affect the employee behaviors, attitude and their
reaction towards organizations. These forms of breach relate with extrinsic and intrinsic
outcomes. Extrinsic includes benefits, pay etc and intrinsic includes emphasize on worthiness
of job. When these form are not fulfilled employee react more negative in their attitudes and
behaviors which affect their identification and employee react towards organizational
disidentification.
Hypothesis 3: Equity sensitivity moderates the relationship between psychological contract
breach and Organizational identification.
Hypothesis 4: Equity sensitivity moderates the relationship between psychological contract
breach and organizational disidentification.
28
2.7 Mediating Role of Perceived Organizational Support
Last few decades perceived organizational support has important variable in the fields of
psychological science and management sciences (Allen et al., 2008; Rhodes and Eisenberger,
2002; Fuller et al., 2003; Stamper et al., 2003; Aube et al., 2007). Researcher define
perceived organization support variable in various way. Eisenberger define in 1986 that
employee in the organizations perceived that employer care their welfare and value their
contributions Eisenberger (1986). How organizations recognize the contributions of
employees and care about their wellbeing (Allen et al., 2008). Many scholars define basic
principle of organizational support theory in their studies (Eisenberger et al. 1986;
Eisenberger and Aselage 2003) that employees in the organization develop overall
perceptions regarding their organization that organization cares about their wellbeing and
provide all essential needs of employees. In light of social exchange theory and reciprocity
norm many authors commentary on perceived organizational support positively relate to
employee - employer relation it creates feeling of responsibilities which help for organization
to reach its targeted results (Eisenberger and Rhoades 2002: Eisenberger et al. 2001; 1986).
Perceived organizational support and HR practices links positive employee attitudes and
behaviors. Supervisor support, good working condition and fair reward system link strong
positive relationship with perceived organizational support (Eisenberger and Rhoades, 2002)
it also strengthen employee beliefs which are helpful for employer to achieve their goals. In
this mata-analysis of Rohades and Eisenberger (2002) identify that rewards has positive relate
to perceived organizational support through which employees polish their capabilities (Shore,
Wayne, & Liden, 1997), identity within their job (Cameron, Rhoades, & Eisenberger, 1999),
and self recognition in management (Tetrick, Bommer, Shore, & Wayne, 2002). On other
antecedent beliefs in their supervisor which care and value employee contributions
(Sharafinski & Kottke, 1988) supervisors act on behalf of the organization and employee
29
identify them as an organization. When employees perceive positive and significant treatment
from supervisor employee indicate them as organizational support (Eisenberger et al., 2002b).
There are also many empirical studies show a strong and significant relationship of job
satisfaction and organizational commitment Riggle et al., 2009; Aube et al., 2007; Rhodes
and Eisenberger, 2002) which help their organization to target their goals (Aselage and
Eisenberger, 2003).
It is the duty of the organization to care their employees and increase their affective
commitment (Rhoades & Eisenberger, 2002). Through affective commitment employees
fulfill their socio-emotional needs through emotional support (Huntington, Eisenberger,
Hutchison & Sowa, 1986; Eisenberger, Fasolo, Armeli & Lynch, 1998). This Perceiced
organizational support enhance commitment to the organization (Wayne, Liden, & Shore,
1997; Eisenberger, Rexwinkel, Armeli, Lynch & Rhoades, 2001; Shore & Wayne, 1993;
Eisenberger, Fasolo & D. LaMastro, 1990; Rhoades & Eisenberger, 2002; Cropanzano,
Randall, Bormann & Birjulin, 1999; Bennett, Settoon, & Liden, 1996; Tetrick & Shore ,
1991; Sinclair & Tetrick 1994;) which are further helpful them to identify their organization
and produce better result for their organization. employees who believe that their
organization are not support or little support are higher intention to leave the organization and
increase absenteeism (Griffeth, Shore & Allen, 1999; Aquino & Griffeth, 1999; Wayne et al.,
1997;) which leave towards organizational disidentification, similarly who believe that
organization support them well are more satisfied with their work and performing better
results which lead towards organizational identification. Consequently perceived
organizational support is positive and significantly relate to organization performance
(Wayne et al., 1997).
30
Perceived organizational support is significant and positive relate with organization in form
of fairness, supervisor relationships, work conditions, etc which force employees to hold
positive attitudes in form of affective organizational commitment and react in good behavior
to enhance performance, increase citizenship, decrease withdrawal and absenteeism that
every organization want (Eisenberger and Stinglhamber 2011; Riggle et al. 2009; Eisenberger
et al. 2001).
Perceived organizational support and breach of psychological contract are the important
variables in the field of researcher. Perceived organizational supports are generally positive
reciprocity and employee’s belief in their contribution, as employees tends to be performs
better to pay back. On other construct psychological contract breach is the feeling of
disappointment arising in their belief because employees think that organizations has broken
its promises, in general it has a negative reciprocity and employee perform poorly to pay
back.
Hypothesis 5: Perceived organizational support mediates the relationship between
psychological contract breach and organizational identification.
Hypothesis 6: Perceived organizational support mediates the relationship between
psychological contract breach and organizational disidentification.
31
Theoretical Model
Identification of Variables/Keywords
Finding of this study has based on conceptual framework 2.1. Key variables of current study
and their keywords which are used in this study are as follow:
Dependent Variable: Organization Identification (OI)
Dependent Variable: Organization Disidentification (OD)
Independent Variables: Psychological Contract Breach (PCB)
Moderating Variables: Equity Sensitivity (ES)
Mediating variables: Perceived Organizational Support (POS)
Conceptual Framework 2.1
32
Hypothesis
H1: There a negative and significant relationship between Psychological contract
breach and organizational identification.
H2: There a positive and significant relationship between Psychological contract
breach and organizational disidentification.
H3: Perceived organizational support mediates the relationship between
psychological contract breach and organizational identification.
H4: Perceived organizational support mediates the relationship between
psychological contract breach and organizational disidentification.
H5: Equity sensitivity moderates the relationship between psychological contract
breach and Organizational identification.
H6: Equity sensitivity moderates the relationship between psychological contract
breach and organizational disidentification.
33
CHAPTER 03
RESEARCH METHODOLOGY
In this chapter we thoroughly discuss the population size of our research, sampling
techniques & tools, instruments used to measure the variables and some other research
methodologies which are used in this research.
3.1 Research Methodology and Design
3.1.1 Research Design
In this study we examine the theoretical and empirical analysis of the linkage between
organizational identification and organizational disidentification with Breach of
psychological contract. Further we also investigate mediating role of perceived organizational
support and moderating role of equity sensitivity in this study and explore their different
dimensions.
3.1.2 Population and sample size
The population of current study represents different non-profit organizations (local &
international organizations) in different locations of Pakistan. Different areas belong to
Islamabad, Rawalpindi and some district of Azad Jammu & Kashmir are selected for data
collection. Approximately more than 25 different private sector organizations (non-profit
organization) were selected and among of them different questionnaires are distributed. Some
famous organizations are Muslim Aid UK, WWF, US Aid, Care international, Plan
International, Save the Children, ROZAN, Water Aid, message trust, NRSP, HRDF etc. were
34
used for gather the required information. The sample size for this study was two hundred and
seventy three (273) questionnaires. Questionnaires are filled through by manually, sending
emails and used different technologies like Google docs etc. More than 410 questionnaires
were distributed among different organizations. Through email and Google docs we received
ninety eight (98) questionnaires which of them eighty eight (88) are useable. One hundred
and eighty five (185) questionnaires were filled through personal distribution and collection.
The overall response rate was sixty seven percent (67%).
The convenience sampling technique was used to attain the required data. This technique is
widely used in social sciences which allow researchers to collect data on the availability of
the subject. This technique is also helpful to meet the time frame and best utilizations of
resources in minimize time and resources. Due to time frame and other resources we used
cross sectional data to analysis the results.
3.1.5 Instrumentation
In this study closed ended Questionnaires will be used to collect the primary data. Nominal
scale are used which contain five likert scale options as Strongly Disagree (1), Disagree (2),
neither agree nor disagree (3), Agree (4) and Strongly Agree (5) which are used for
psychological contract breach, perceived organizational support and equity sensitivity
whereas seven likert scale ranges from strongly disagree (1) to strongly agree (7) are used for
organizational identification and organizational disidentification.
3.1.5.1 Psychological contract breach
Psychological contract breach were measured using five scale items taken form Robinson and
Morrison’s (2000) with five likert scale options from Strongly Disagree (1) to Strongly Agree
(5). The value of cronbach’s alpha reported as 0.775.
35
3.1.5.2 Organizational Identification and organizational disidentification
Organizational identification and disidentification was measured using Kreiner and Ashforth
(2004) which contain six, six items scale. Seven likert scale are used ranges from strongly
disagree (1) to strongly agree (7) for both organizational identification and organizational
disidentification. The value of Cronbach’s alpha is 0.914 and 0.882 respectively.
3.1.5.3 Equity Sensitivity
Equity sensitivity was measured using 16 scale items which are developed by Sauley &
Bedeian (2000) and further used by Foote and Harmon (2006) and other researcher in the
literature for measuring equity sensitivity. 16 items with 05 point likert scale are used ranges
from Strongly Disagree (1) to Strongly Agree (5). The value of cronbach’s alpha is 0.856.
3.1.5.4 Perceived Organizational Support
Perceived Organizational Support (POS) was measured using eight-item scale taken from
survey of Perceived Organizational Support (Eisenberger et al. 2001), 08 items with 05 likert
scale are used ranges from Strongly Disagree (1) to Strongly Agree (5). The value of
cronbach’s alpha reported as 0.849.
36
Table 3.1
Instrumentation
Variable Sources Items
Breach of Psychological Contract Robinson and Morrison’s (2000) 05 Items
Perceived Organizational Support Rhoades and Eisenberger (2002) 08 items
Equity Sensitivity Sauley & Bedeian (2000) 16 items
Organizational Identification Kreiner and Ashforth (2004) 06 items
Organizational Disidentification Kreiner and Ashforth (2004) 06 items
Five Likert Scale are used as Strongly Disagree, Disagree, Neither, Agree and Strongly Agree
3.1.6 Data Collection Technique and time frame
In this study we use Convenience sampling technique because it is easy to use and gather
required data within time constrain where a large number of respondents are there. This
technique is widely used in the research studies. In this study we used two hundred and
seventy three respondents from more than twenty five (25) private sector organizations (non-
profit organization) which are international as well as local organizations.
3.1.7 Data Analysis Tools
Data are collected through closed ended questionnaires, SPSS software were used to analysis
the data. Correlation and regression analysis are run to analysis the data. Correlation analysis
and regression analysis are used to check the relation between dependent and independent
variable while regression analysis show how much change in independent variable caused to
change dependent variable. Factor analyses are also used to check the causal relationship
between variables.
37
3.1.8 Analytical techniques and tool used
IBM SPSS Statistic 17 was used for determination of further results; various statistical
analyses like reliability test, descriptive test, Liner Regression, correlation were used to find
out the impact of variables on each others. Cronbach’s alphas were used to calculate the
internal reliability of the scale.
Table 3.2
Sample Characteristics
Respondents’ demographic characteristics
Gender
Frequency Percent
Male 141 51.6
Female 132 48.4
Total 273 100.0
Qualification
Frequency Percent
Bechlor 66 24.2
Master 122 44.7
MS/Phil 85 31.1
Total 273 100.0
Experience
38
Frequency Percent
Below 5 68 24.9
5-10 130 47.6
10-Above 75 27.5
Total 273 100.0
Organizational Tenure
Frequency Percent
less than 2 year 83 30.4
3 – 5 84 30.8
more than 5 years 106 38.8
Total 273 100.0
Organization
Organizations Frequency Percent Organizations Frequency Percent
Action Aid 10 3.7 NRSP 12 4.4
AJKRSP 10 3.7 Plan 9 3.3
Aurat Foundation 12 4.4 ROZAN 14 5.1
Care 18 6.6 Sahil 5 1.8
CHIP 17 6.2 Save the children 5 1.8
ERRA 14 5.1 Shade 12 4.4
HASHOO 14 5.1 Sharp 9 3.3
Helping Hands 10 3.7 US Aid 9 3.3
HRDF 6 2.2 Water Aid 12 4.4
Islamic Relief 14 5.1 World vision 6 2.2
Kiran 14 5.1 WWF/Wetlands 16 5.9
Lead 5 1.8 Total 273 100.0
Message Trust 10 3.7
Muslim Hands 10 3.7
Gender wise frequency analysis reports that majority of the respondents was male. Total
number of males consists of 141 out of 273 that work out to be 51.6% of the sample. On the
39
other hand total number of female respondents is relatively low (i.e. 132 in number &
48.4%). The above descriptive statistics also explain marital status of the respondents and
result indicates that a total of 156 respondents that work out to be 57.1% are married &
unmarried respondents consist of 117 that make it 42.9%.
The survey also collects data about the qualification of the respondents. Here the highest
percentage has been seen for Master level i.e. 16 years of education. There are 122 of the
respondents has formal education for 16 years i.e. 44.7%. However in other qualification
categories 85 respondents (31.1%) are found in MS/M.phil Category, 66 respondents has
completed their Bachelor degree which are 24.2% of the total sample. Experience wise the
highest percentage consists of 5-10 years group that is a total of 130 respondents making it
47.6% of the total sample. However, 68 respondents are reported in less than 5 years making
it 24.9% of sample. Rest 75 respondents (27.5%) are reported as above the 10 year of
experience. In this study we also gather data about respondent current organization tenure; we
found that most of the respondent belongs to more than 5 years which are 106 respondents
(38.8), and less than 2 years respondents belongs to less than 2 years which are 30.4% of the
total size.
This study also contains information about the sample size of questionnaires that are
distributed among different organization. Approximately 25 non-profit organizations are
selected for sampling size. The maximum numbers of questionnaires are received form Care
international, CHIP, WWF which are 18, 16 and 16; whereas minimum numbers of
questionnaires are received form lead international, save the children and world vision as 5, 5
and 6 respectively.
40
3.2 Reliability
Through IBM SPSS Statistic 17 we run reliability test on collected data of different variables
in private sector organizations (non-profit organizations), the calculated reliability
(Cronbach’s Alpha) show that collected data is reliable for further analysis. Table 3.3
explains the reliability of different variables.
Table 3.3
Scale Reliabilities
Variable Cronbach’s Alpha No. of Items
Breach of Psychological Contract .775 05 Items
Perceived Organizational Support .849 08 items
Equity Sensitivity .856 16 items
Organizational Identification .914 6 items
Organizational Disidentification .882 6 items
Internal reliability of a scale refers to its ability to consistent results when administered with
several numbers of items or even in the case of checking reliability by various methods such
as split half method and others. Reliability test is the one of the common test to verify the
validity of scale that asses the reliability of a scale. It refers to its internal consistency in
measuring a construct. The range of Cronbach’s Alpha is 0 to 1. However, higher values are
indicates greater reliability of the scale. It also capable to measure the inter correlation among
various items in the scale. Generally the Alpha values above 0.7 are taken to be reliable,
41
whereas on the other hand, lower values shows lower reliability of the scale in measuring
construct or its different dimensions. The above table 3.3 gives details of Cronbach’s Alpha
coefficient used to collect data for this study. Through this table internal consistency of scales
used are visible. The highest Alpha value has been seen for the scale used to measure
organizational identification is 0.914. It refers to the high reliability of the scale used. The
lower cronbach’s alpha is reported breach of psychological contract which is .775 which is
relatively low compared to others. All the scale used for survey shows a good reliability
values.
Equity sensitivity instruments are frequently used to measure the equity sensitivity in
literature. Equity sensitivity preferences instrument are also used for measuring the equity
sensitivity due to criticized by many authors that poor items developments, sample scoring,
lack of content validity and item ambiguity (Bedeian & Sauley, 2000). The critique of equity
sensitivity instruments direct to the development of the equity preference questionnaires,
sixteen-item scale which are developed by Bedeian and Sauley (2000) are used to measure
equity sensitivity. In previous reliability and validity which are associated with equity
sensitivity instruments, the equity preference questionnaires which are developed using more
systematic item development. Bedeian and Sauley (2000) developed equity preference
questionnaires using more than six studies and developing final version which consists of 16
items. Recent studies of (Wheeler, 2007; Straus & Shore, 2008) conduct their studies and
conclude that equity sensitivity questionnaires are more valid and reliable for measuring the
equity sensitivity constructs.
42
CHAPTER 04
RESULTS
The objective of this study is to analysis the organizational behaviors and their outcomes of
psychological contract breach. In this research we develop relationship between breach of
psychological contract and their effect on organizational identification and organizational
disidentification with mediating role of perceived organizational support and moderating role
of equity sensitivity.
The following variables are used in current research
Psychological contract breach (PCB)
Organizational identification (OI)
Organizational disidentification (OD)
Equity sensitivity (ES)
Perceived organizational support (POS)
To test relationship between these variables we use correlations, regression and other
mediating and moderating analysis to check our hypothesis.
4.1 Descriptive Statistics
Descriptive statistics used to analysis the data in sample and summaries form. Descriptive
statistics tells us about the details of data that has been used and collected such as ’N’ number
of respondents, maximum, minimum, standard deviation and mean value of the data. It also
gives information in percentage and summarized form. The details of research data is
presented in the table 4.1 as below.
43
Table 4.1
Descriptive Statistics
(Minimum, Maximum, Mean and Standard Deviation)
Variable N Minimum Maximum Mean Std. Deviation
Perceived Organizational support 273 1.00 5.00 2.1351 .60455
Breach of Psychological Contract 273 2.00 4.80 3.6630 .60231
Organizational Identification 273 1.17 7.00 4.3010 1.17941
Organizational Disidentification 273 1.33 7.00 4.0201 .90472
Equity Sensitivity 273 1.00 5.00 2.7283 .96335
This above table 4.1 explains descriptive statistics of the variables under study. The table
summarized the data related to ‘N’ number of participants, maximum, minimum, and also
shows the standard deviation and mean of variables. The first column of the table consist of
variable names, the 2nd column explain about the sample size of the study which are three
hundred and nine, 3rd & 4th column tell us about the minimum and maximum values collected
data. The 5th column tells about the mean value of each variable. The data has been collected
as a whole value instead of fraction values. Gender represent in two forms 1 for male & 2
denote for females. The mean value for Breach of Psychological Contract is 3.6630 with
standard deviation of .60231. The mean value of organizational Identification is 4.3010 with
standard deviation of 1.17941 and mean value of organizational disidentification is 4.0201
with standard deviation of .90472. Perceived organizational Support as mediator is observed
to have mean value of 2.1351 with standard deviation of .60455. Moderator variable Equity
Sensitivity has mean value of 2.7283 having standard deviation of .96335. Perceived
44
organizational support indicates to have lowest mean and organizational identification has
measure with highest mean and highest standard deviation. The, results of the study are same
as others studies are available in literature.
4.2 Correlation Analysis
The purpose of correlation is used to signify the relationship between two or more variables
which are moves in similar or opposite direction. Correlation test was used to check the
relationship between independent variables, breach of psychological contract and dependent
variables, organizational identification. It is different from regression analysis which is not
considering causal linkages for the variables understudy. In correlation we analysis the
variables are moving in same or opposite direction with zero correlation. It may have values
from -1 to +1 means +1 is perfect positive correlate and -1 means perfect negative
correlation. However 0 means there is no correlation exists between variables.
Correlation analysis is indicated in below table 4.2. Results are explain here
The table also show the results with reference to the demographic variables such as
psychological contract breach has significant correlation with Gender (R= .169 having
p≤0.01), qualification (R = -.140 having p≤0.05), while organization tenure (R = .014) and
experience (R = -.157 having p≤0.01) has negative and significant relationship. The
correlation analysis of dependent variable as organizational identification has shown their
correlation with other demographic variables as gender (R = -.130, significant), qualification
(R = -.128 having p≤0.01), organizational tenure (R = .094) and experience (R = -.207) have
negative relationship. Organizational disidentification has correlate with other variables as
gender (R = .116, insignificant), qualification (R = .076), organization tenure (R = .116), and
experience (R = .051). The above table also illustrate demographic variables has correlate
45
with moderating variable of equity sensitivity and mediating variable of perceived
organizational support.
This study also depicts the relationship of independent variable (breach of psychological
contract) and dependent variables. Organizational identification having (R = -.207 with p
value of 0.01) show strong negative significant correlation and organizational
disidentification having (R = .375 with p value of 0.01) show strong positive significant
correlation with psychological contract breach. Further correlation between perceived
organizational support with organizational identification having (R = .257 with p value of
0.01) and with organizational disidentification having (R = .409 with p value of 0.01)
significant correlation exists between these variables.
Moderating role of equity sensitivity correlate with organizational disidentification having R
is equal to -.331 with p value ≤0.01 and organizational identification R is equal to .236 with p
value ≤0.01. Perceived organizational supports (mediator) correlate with dependent variable
(breach of psychological contract) having R is equal to -.740 , correlate with organizational
identification R is equal to .257 with p≤0.01 show positive correlation and organizational
disidentification having R is equal to -.409 with p≤0.01 show negative correlation. The result
of current correlation is same as the previous researchers has explored in their studies.
46
Table 4.2
Correlation
Correlation Matrix
1 2 3 4 5 6 7 8 9
1. Gender 1
2. Qualification .117 1
3. Organizational Tenure .132* .170** 1
4. Experience -.055 .311** .266** 1
5. Psychological Contract Breach .169** -.140* .014 -.157** 1
6. Perceived Organizational Support -.144* .013 -.024 .042 -.740** 1
7. Equity Sensitivity -.178** -.106 -.116 .074 -.558** .568** 1
8. Organizational Identification -.130* -.128* .094 .034 -.207** .257** .236** 1
9. Organizational Disidentification .116 .076 .116 .051 .375** .409** -.331** -.139* 1
*. Correlation is significant at the 0.05 level (2-tailed).
**. Correlation is significant at the 0.01 level (2-tailed).
47
4.3 Regression Analysis
Regression analysis is widely used to predict and exams the relationship among variables.
Correlation analysis shows the strength of relationship of X variables with Y variable.
Whereas the regression analysis explain the predictions about Y from the values of X. It is
used to illustrate conclusion regarding variable dependence on each other. The analysis is
used to estimate the dependence of one variable over other variable where dependent variable
is regressed on independent variable.
Table 4.3
Regression Analysis for outcomes of PCB
Predictor : PCBOrganizational
Identification
Organizational
Disidentification
Step I
Control Variables .030 .024
Step II
Breach of psychological
contract
-.189** .064 .035** .366*** .154 .130***
*** p ≤ 0.001, ** p ≤ 0.01, * p ≤ 0.05
In the table 4.3 shows the direct relationship of psychological contract breach with other two
dependent variables such as organizational identification and organizational disidentification. In
organizational identification result show that having beta (β) = -.189 with significant level of P≤
0.01 negative and significant relationship with psychological contract breach. In organizational
disidentification beta (β) having .366 having P≤0.001 strong positive significant relationship with
48
psychological contract breach which depict that when breach of psychological contract take place
organizational identification has negatively relate to identification of organization whereas
organizational disidentification has strongly positively relate when breach of psychological
contract take place.
H1: There a negative and significant relationship between Psychological contract breach
and organizational identification.
Results of regression analysis show that organizational identification has negative and
significant relationship with breach of psychological contract having beta (β) = -.189 with
significant level of P≤ .001. According to the results, which supporting the hypothesis that
breach of psychological contract is negatively and significantly relate to organizational
identification. Thus our hypothesis is accepted
H2: There a positive and significant relationship between Psychological contract breach
and organizational disidentification.
Results of regression analysis show that organizational disidentification has positive and
significant relationship with breach of psychological contract having beta (β) = .366 with
significant level of P≤ 0.001. According to the results, which supporting our hypothesis that
breach of psychological contract is positively and significantly relate to organizational
disidentification. Our hypothesis is accepted
49
4.4 Mediated Regression Analysis
Figure 4.1
I II
III
To understand the mediating roles of variable in research we go through the paper of Barron
and Kenny (1986) who explain the following conditions which are must be fulfilled to prove
mediation. Figure 4.1 was explains the mediating role and their influence on other variables
in the research.
Predictor must be related to mediator (I)
Mediator to criterion (II)
Predictor to criterion (III)
Mediating role of perceived organizational support
To test the mediation, regression analysis was used and run test on the data. This was
confirmed by placing independent variable (psychological contract breach) followed by
mediating variable (i.e. perceived organizational support) and in the end dependent variable
(i.e. organizational identification and organizational disidentification). Mediating test was run
through three steps. In 1st move control variables in independent box, than next step perceived
organizational support and last step take psychological contract breach in that box, dependent
variable (organizational identification and disidentification) was moved in dependent box and
then run the regression test.
50
Predictor
Mediator
Criterion
Table 4.4
Mediated Regression Analysis
Predictors Perceived Organizational
Support (POS)
Organizational
Identification (OD)
Organizational
Disidentification (OI)
β R² ΔR² β R² ΔR² β R² ΔR²
Step I:
Control Variables .021
Step II:
Psychological contract breach -.736** .542 .527***
Step I:
Control Variables .030 .024
Step II:
Psychological contract breach -.189** .064 .033** .336** .154 .130***
Step I:
Control Variables .030 .024
Step II:
Perceived Organizational
Support
.244*** .088 .058*** -.400*** .181 .157***
Step III:
Psychological contract breach -.021ns .088 .000ns .155ns .192 .011ns
*** p ≤ 0.001, ** p ≤ 0.01, * p ≤ 0.05, ns = insignificant
51
H3: Perceived organizational support mediate the relationship between psychological
contract breach and organizational identification.
The results (Table 4.4) indicate that organizational identification have (β = -.189, ΔR² =.033,
having p≤0.01) significant relationship with psychological contract breach. Through use of
Barron & Kenny (1986) rules further statistics show that breach of psychological contract
becomes insignificant when perceived organizational support as a mediator is consider (β) =
-.021, ΔR² =.000 insignificant, which support our hypothesis.
H4: Perceived organizational support mediate the relationship between psychological
contract breach and organizational disidentification.
Table 4.4 explains mediating role of perceived organizational support with organizational
disidentification. Regress analysis predictor organizational disidentification having (β = .336,
ΔR² =.130, having p≤0.001) statistics depict that there is positive and significant relationship
among organizational identification and psychological contract breach. In next we run test on
perceived organizational support as a mediator in step III which indicates beta (β) = .155,
ΔR² =.192 insignificant indicates that perceived organizational support is fully mediate
between organizational disidentification and psychological contract breach. Thus our
hypothesis is accepted
52
Table 4.5
Moderated Regression Analysis (ES)
Predictors Organizational
Identification (OI)
β R² ΔR²
Main Effect: Equity Sensitivity
Step I:
Control Variables .030
Step II:
Psychological Contact Breach -.089***
Equity Sensitivity .183*** .073 .057***
Step IV:
Interaction term (Psychological
Contract Breach * Equity sensitivity)
-1.261*** .112 .041***
*** p ≤ 0.001, ** p ≤ 0.01, * p ≤ 0.05, ns = insignificant
H5: Equity sensitivity moderates the relationship between psychological contract breach
and Organizational identification.
In table 4.5 regression analysis has been used to analysis the moderating role of equity sensitivity.
Result shown that interaction term between breach of psychological contract and equity
sensitivity has significant relationship with organizational identification β = -1.261 with R² = .112
having P≤0.001. Results show that equity sensitivity moderate between the psychological contract
breach and organizational identification hence our hypothesis accepted.
53
Table 4.6
Moderated Regression Analysis (ES)
Predictors Organizational
Disidentification (OI)
β R² ΔR²
Main Effect: Equity Sensitivity
Step I:
Control Variables .024
Step II:
Psychological Contact Breach .280***
Equity Sensitivity -.159*** .171 .147***
Step IV:
Interaction term (Psychological
Contract Breach * Equity sensitivity)
.608ns .181 .010ns
*** p ≤ 0.001, ** p ≤ 0.01, * p ≤ 0.05, ns = insignificant
H6: Equity sensitivity moderates the relationship between psychological contract breach
and organizational disidentification.
Statistics in Table 4.6 explains the moderating role of equity sensitivity with predictor of
organizational disidentification. Result shown that interaction term between breach of
psychological contract and equity sensitivity has insignificant relationship with organizational
disidentification β = .608 with R² = .181. The P value (insignificant) indicates that insignificant
relationship exists between organizational identification and psychological contract breach. So
our hypothesis has been rejected.
Table 4.7
54
Summary of Accepted/ Rejected Hypothesis
Hypothesis Statements Results
H1: There a negative and significant relationship between Psychological
contract breach and organizational identification.
Accepted
H2: There a positive and significant relationship between Psychological
contract breach and organizational disidentification.
Accepted
H3: Perceived organizational support mediate the relationship between
psychological contract breach and organizational identification.
Accepted
H4: Perceived organizational support mediate the relationship between
psychological contract breach and organizational disidentification.
Accepted
H5: Equity sensitivity moderates the relationship between psychological
contract breach and Organizational identification.
Accepted
H6: Equity sensitivity moderates the relationship between psychological
contract breach and organizational disidentification.
Rejected
Total number of Hypotheses: 06
Accepted: 05
Rejected: 01
55
CHAPTER 05
DISCUSSION AND CONCLUSION
5.1 Discussion and conclusion
The main objective of this study was to examine the relationship between psychological
contract breach with organizational identification and disidentification with mediating role of
perceived organizational support and moderation role of equity sensitivity.
Tables 4.7 accept five hypotheses and reject one hypothesis. Five hypotheses which are
accepted are found significant relationship with other variables. Equity sensitivity as a
moderating variable between organizational disidentification and breach of psychological
contract was rejected in this study. In organizational disidentification employees are distant
himself from their organization and their belief are broken down so equity sensitivity will not
affect or moderate between organizational disidentification and psychological contract
breach in this situation equity sensitivity does not matter. In developing countries where
employees are attached with their organization either financially or emotionally and believe
that organizations give those all psychological needs when these needs are not provided and
breach occurs employees distant himself from organization. The results shown that in non-
profit organizations equity sensitivity will not moderate between breach of psychological
contract and organizational disidentification. Results of current research show the same
results as other researcher was explained in their studies, Sauley and Bedeian (2000) Thomas
J. Zagenczyk et al. (2012). When employee works in the organization psychological contract
will help employees to frame work their attitude and behaviors according to their
expectation. When relationship between employer – employee has been destabilized than
employee equity preferences input and output ratio has been changed and their preferences
56
shift from organizational identification and organizational disidentification and vice versa.
Previous studies have shown that when organization has not fulfilled its promises then
breach occurs. This breach has mostly negative consequences for both employee and
employer sides. Their consequences include organizational commitment, frustration of
employees, employee’s loyalty towards organization, organizational identification and
organizational disidentification. Breach occurs in private sector organization (nonprofit
organizations) due to politics in organization, policies of organization, informal structure of
organization, and their beliefs towards organization. Previous studies have been shown
significant negative relationship exists between organization identification and positive
significant association among breach of psychological contract and organizational
disidentification Zagenczyk et al. (2011a) and Restubog et al. (2008). The hypothesis testing
the linkage between psychological contract breach and identification & disidentification was
also show significant statistics by the data. The significant statistics show that breach of
psychological contract has negative associate to organizational identification and positive
associate to organizational disidentification.
In table 4.3 of chapter 4 shows the direct relationship of breach of psychological contract
with other dependent variables. With organizational identification result show that having
beta (β) = -.189 with significant level of P≤ .001 negative and significant relationship with
psychological contract breach whereas organizational disidentification show beta (β)
having .366 with significant level of P≤ .001 with positive significant relationship with
psychological contract breach which show that when breach occurs organizational
identification has strongly negative approach and strongly positive relate to organizational
disidentification. Further table 4.4 explains mediating role of perceived organizational
support which statistically explain that perceived organizational support have fully mediate
57
between organizational identification (β = -.021, ΔR² =.000 insignificant) and organizational
disidentification (β = .155, ΔR² =.192 insignificant).
The current study serves its purpose of investigating that organizational identification and
organizational disidentification are predicted by psychological contract breach with
moderator as equity sensitivity and mediating role of perceived organizational support. Aside
from the support for these questions, the current study has found significant result of first
five hypotheses and rejected one hypothesis.
In literature found that broken of psychological contract has received great attention and
focus of the researcher for few decades. In this research we study the broken psychological
contract implications and their effect on employee’s attitudes and behaviors. The current
research begins to analyze role of psychological contract breach with mediators or moderator
role POS and ES in the relationship and employee affiliations towards organizational
identification and organizational disidentification. In nonprofit organizations where
employees found challenging environment and deliver their works in short span of time
employee also expect from their employer to fulfill their promises. To meet these challenges
organizations have altered psychological contract with their employees. Psychological
contract provide different consequences in the relationship to fulfilled employees belief.
Scholars suggests that when organization provide employees beliefs and assumptions
employee exhibit positive attitudes and behaviors such as commitment, hard work, and
feeling satisfied with organization with further belongs to organizational identification,
however sometime organizations have failed to fulfill employee promises which result in the
breach of psychological contract which are belongs to organizational disidentification.
When an employee perceives a misfit in the reciprocal promise in the organization, their
attitude and behaviors changed which further move towards organizational disidentification.
58
Employees who feel psychological contract broken displeasure with their management and
neglect there in job role performance and are less likely to be loyal to the organization.
Literature show negative results which are minimize the extra role behaviors, lower job
satisfaction, negative feeling, lower level of loyalty and trust. Some research suggests a
empirical study between breach of psychological contract and irritation, frustration,
depression and decreases in loyalty (Ugwu, & Ogwuche, 2013).
Many researcher discuss when organization’s who not fulfill employees beliefs which are
motivate employees to seize negative organization related behaviors & attitudes and
minimize contributions towards organization (Zhao et al. 2007) actually harmful for
organization and give opportunity for revenge (Bordia et al. 2008) and also withhold from
customers (Bordia et al. 2010) this type of act support the negative reciprocity norm
(Gouldner, 1960) which began organizational disidentification. Many other research support
that there will be negative association between breach of psychological contract and
organization identification and positive between breach of psychological contract and
organization disidentification Restubog et al. (2008) & Zagenczyk et al. (2011a). Study of
Zagenczyk et al. (2011a) and Restubog et al. (2008) also support the results of current study.
59
CHAPTER 6
CONCLUSIONS, LIMITATIONS, RECOMMENDATIONS &
DIRECTION FOR FUTURE RESEARCH
6.1 Introduction
Purpose of current research was to analysis the relationship between variables which are
used in this study. Current research explore whither there was a negative and significant
relationship exists between organizational identification and psychological contract breach
and significant and positive relationship between breach an organizational disidentification.
Current study also statistically found mediating and moderating role of ES and POS between
PCB and other dependent variables. Within this chapter we will discuss the literature and
empirical results and draw their limitations, implications and their recommendations which
are helpful for private sector organization (nonprofit organizations) and probable for future
research.
6.2 Conclusion
In this section we will draw the conclusion which is related to this study. We will draw
conclusion on the bases of empirical and theoretical study, available information in the
literature and recommendation made by the researcher.
Literature review was prepared on the bases of breach of psychological contract,
organizational disidentification/identification, perceived organizational support and equity
sensitivity which empowered by researcher to construct model, assumptions and develop
60
their hypothesis which evaluate and analyze the finding of earlier studies and compare the
results of current study with previous studies.
Literature focused on the concept of psychological contract breach. In literature we found
two different scales to measure psychological contract breach. In current study used scale of
Robinson and Morrison’s (2000) which shows better reliability. Further equity sensitivity is
also an important variable in this study; we found two different types of scales in the
literature. equity sensitivity was measured using Sauley and Bedeian (2000) because other
scale was criticize by many research due to dichotomous response patterns which are
difficult to measure and data gather. Kreiner and Ashforth 2004 scale was used to measure
the organizational identification and disidentification.
Literature support that there will be negative association between breach of psychological
contract and organization identification and positively relate with breach of psychological
contract and organization disidentification Zagenczyk et al. (2011a) and Restubog et al.
(2008). Both concepts are similar and describe the function of organization membership that
performs in employees self concepts. Organization identification is a form where employees
emerge their attributes and redefine self concepts (Mael and Ashforth, 1989). Identification is
likely when employees perceived that organization or group consider them as a distinct entity
or in a positive manner (Dutton et al. 1994). Our hypothesis was also developed on the basis
of these literature and further current study shown the same results as previous authors
discuss in their research.
This study also addressed the difference between organizational identification and
organizational disidentification. It also discussed organizational identification and
organizational disidentification in general and examined the role of perceived organization
support and equity sensitivity which influences between the relationships.
61
6.3 Limitations
Every study has some limitations which dependent on different factors. In current study there
are also some limitations which are explain below
Cross sectional data is used in this study which is the main limitation of current study.
Longitudinal studies require data collection in different time slots did not allow a
longitudinal analysis of variables under this study. The main limitation of current study was
the collection of data from different nonprofit organizations based on Islamabad, Rawalpindi
which are not cover the whole population of Pakistan. Another limitation is that data was
collected and investigations in a single nature of job which are not cover whole population
sample technique are used to collect the required data. This limits concluding results for a
wider contextual level of culture and hierarchical level. Further research should perhaps be
the investigations of multiple hierarchical and cultural levels to increase the generalizability
of research findings. Important limitations of this study was that there is too little information
available in the literature as it is an emerging idea and there is no much literature and
relevant studies are available in this context. Being a human and as we know human nature
the favourism phenomenon may have also affected the results because each and employer
have a list of some good and bad affiliation towards their organization. This psychological
term may have affected the result as well.
6.4 Recommendations & Direction for Future Research
Current study has investigated the link between breach of psychological contact and
organizational identification & organizational dis-identification having moderating and
mediating role of equity sensitivity and perceived organizational support. Results show
significant relationship between variables. Similarly POS mediate the relationship between
62
breach of psychological contract and organizational identification & disidentification, equity
sensitivity will moderating between breach of psychological contract and organizational
identification whereas organizational disidentification is not moderated through equity
sensitivity in this study.
Equity sensitivity variable is numerous opportunities for further research. First all variable or
construct can be further investigate in terms of their relationship with other variables such as
frustration, organizational commitment and job performance. Equity sensitivity either
uniquely or interactively predicts other important organizational outcomes such as employee
performance, maybe mediated by justice perceptions (cf. Colquitt et al., 2001). Second equity
sensitivity involves employee reaction to unfair situation this consequences may relate to
employee emotion state. So in future research can be study the link between emotional
intelligence and equity sensitivity or other related constructs. Equity sensitivity has different
consequences at work floor due to differences of opinions at work (Detert & Edmondson,
2011). Employees can be express their preferences depends on cultural situation, explore
further theoretical and practical implications.
Organizational identification and disidentification are relatively new variable in the literature
and it needs to be further exploring in other fields as private and public sector organizations.
This construct was investigating through breach of psychological contract and in future will
be examined with other variables as well.
In future research will be containing broader and spacious samples which are larger
exploratory of the population, investigate issues such as gender and performance rating,
ethnicity. Different personnel sectors (such as; executives, senior managers and leaders)
which give their hundred percent honest measurement and better results.
63
The results of this study could serve as a useful source of information in further research
even though these results may be in private sector organizations specific. It is recommended
that similar studies should be conducted in economic and other sector in order to extend the
relevance of the results on the relationship between the psychological contract breach and
organizational identification and organizational disidentification.
Comprehensively, in the future larger sample size should be recommended for study of
diversified population the impact of other variables on the research findings use different
scales to analysis the results and should be work on other sectors like governments, public
and private business sectors to explore the further dimensions in the literatures.
64
ANNEXURE I
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65
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78
ANNEXURE II
QUESTIONNAIRE
79
Dear Respondent,
I am a student of MS in management sciences program at Muhammad Ali Jinnah University
conducting a research on the topic: “Breach of Psychological Contract and its impact on
Organizational Identification and Disidentification: Mediating role of Perceived
Organizational Support and moderating role of Equity Sensitivity”. For this I need your
valuable input. It will not take more than 10 minutes to fill this questionnaire. The data will
be used for academic purposes only and will not be shared with any one for any other
purposes. In order to ensure anonymity, you are not required to mention your name anywhere
on the questionnaire.
Thank you for your cooperation,
M. Irfan Raza
MS Scholar,
Muhammad Ali Jinnah University Islamabad, Pakistan.
1. Gender
Male 1 Female 2
2. Qualification
Less Bachelor 1 Bachelor 2 Master 3 Above MS 4
3. Organization Tenure
Below 02 year 1 03-05 years 2 Above 05 years 34. Experience
Below 05 1 05-10 years 2 Above 10 years 380
5. Name of Organization : -----------------------------------------------------------------
81
Ser
ial #
ITEMS
Str
ongl
y D
isag
ree
Dis
agre
e
Dis
agre
e S
omew
hat
Und
ecid
ed
Agr
ee S
omew
hat
Agr
ee
Str
ongl
y A
gree
Organizational Identification
01 When someone criticizes my organization, it feels like a personal insult
1 2 3 4 5 6 7
02 I am very interested in what others think about my organization
1 2 3 4 5 6 7
03 When I talk about this organization, I usually say ‘we’ rather than ‘they’
1 2 3 4 5 6 7
04 This organization’s successes are my successes 1 2 3 4 5 6 7
05 When someone praises this organization it feels like a personal compliment
1 2 3 4 5 6 7
06 If a story in the media criticized this organization, I would feel embarrassed
1 2 3 4 5 6 7
Organizational Disidentification
07 I am embarrassed to be part of this organization 1 2 3 4 5 6 7
08 This organization does shameful things 1 2 3 4 5 6 7
09 I have tried to keep the organization I work for a secret from people I meet
1 2 3 4 5 6 7
10 I find this organization to be disgraceful 1 2 3 4 5 6 7
11 I want people to know that I disagree with how this organization behaves
1 2 3 4 5 6 7
12 I have been ashamed of what goes on in this organization
1 2 3 4 5 6 7
82
Ser
ial #
ITEMS
Str
ongl
y D
isag
ree
Dis
agre
e
Nei
ther
Agr
ee
Str
ongl
y A
gree
Psychological Contract Breach
13Almost all the promises made to me by my employer during recruitment have been kept so far.
1 2 3 4 5
14I feel my employer has come through in fulfilling its promises made me when I was hired
1 2 3 4 5
15So far my employer has done excellent job of fulfilling its promises to the contributions.
1 2 3 4 5
16I have not received everything promised to me in exchange for my contributions.
1 2 3 4 5
17My employer has broken many of its promises with me even though upheld my side of the deal.
1 2 3 4 5
Perceived Organizational Support
18 The organization values my contribution to its well-being. 1 2 3 4 5
19The organization fails to appreciate any extra effort from me.(R)
1 2 3 4 5
20 The organization would ignore any complaint from me.(R) 1 2 3 4 5
21 The organization really cares about my well-being. 1 2 3 4 5
22Even if I did the best job possible, the organization would fail to notice.(R)
1 2 3 4 5
23The organization cares about my general satisfaction at work.
1 2 3 4 5
24 The organization shows very little concern for me.(R) 1 2 3 4 5
25The organization takes pride in my accomplishments at work.
1 2 3 4 5
83
Ser
ial #
ITEMS
Str
ongl
y D
isag
ree
Dis
agre
e
Nei
ther
Agr
ee
Str
ongl
y A
gree
Equity Sensitivity
26I prefer to do as little work as possible at work while getting as much as I can from my employer. (R)
1 2 3 4 5
27If I could get away with it, I would try to work just a little bit slower than the boss expects. (R)
1 2 3 4 5
28 When I am at my job, I think of ways to get out of work. (R) 1 2 3 4 5
29It is really satisfying to me when I can get something for nothing at work. (R)
1 2 3 4 5
30It is the smart employee who gets as much as he or she can while giving as little as possible in return. (R)
1 2 3 4 5
31If I had to work hard all day at my job, I would probably quit. (R)
1 2 3 4 5
32I am most satisfied at work when I have to do as little as possible. (R)
1 2 3 4 5
33Employees who are more concerned about what they can get from their employer rather than what they can give to their employer are the wisest ones. (R)
1 2 3 4 5
34 At work, I feel uneasy when there is little work for me to do. 1 2 3 4 5
35I would become very dissatisfied with my job if I had little or no work to do.
1 2 3 4 5
36All other things being equal, it is better to have a job with a lot of duties and responsibilities than one with few duties and responsibilities.
1 2 3 4 5
37A job that requires me to be busy during the day is better than a job which allows me a lot of loafing.
1 2 3 4 5
38At work, my greatest concern is whether or not I am doing the best job I can do.
1 2 3 4 5
84
Ser
ial #
ITEMS
Str
ongl
y D
isag
ree
Dis
agre
e
Nei
ther
Agr
ee
Str
ongl
y A
gree
39Even if I receive low wages and poor benefits from my employer, I would still try to do my best at my job.
1 2 3 4 5
40 I feel obligated to do more than I am paid to do at work. 1 2 3 4 5
41When I have completed my task for the day, I help out other employees who have yet to complete their tasks.
1 2 3 4 5
85
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