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human relations 2014, Vol. 67(7) 821 –848
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human relations
The role of negative affectivity in the relationships between pay satisfaction, affective and continuance commitment and voluntary turnover: A moderated mediation model
Alexandra Panaccio John Molson School of Business, Concordia University, Canada
Christian Vandenberghe HEC Montréal, Canada
Ahmed K Ben Ayed HEC Montréal, Canada
Abstract This study examines the mediating role of affective and continuance commitment in the relationship between pay satisfaction and voluntary turnover, and the moderating role of negative affectivity. Drawing from data collected at two points in time from a sample of human resource management professionals (N = 509), we found that affective and continuance commitment mediated the negative relationship of pay satisfaction to turnover. Moreover, pay satisfaction’s indirect negative relationship with turnover via affective commitment was weaker among respondents high in negative affectivity, while its indirect negative relationship with turnover via continuance commitment was stronger among those with high negative affectivity. Finally, the residual negative relationship of pay satisfaction to turnover was stronger at high levels of negative affectivity. We discuss the implications of this study for our understanding of the role
Corresponding author: Christian Vandenberghe, Department of Management, HEC Montréal, 3000 Chemin Côte Ste-Catherine, Montréal, Quebec, H3T 2A7, Canada. Email: [email protected]
516377HUM0010.1177/0018726713516377Human RelationsPanaccio et al. research-article2014
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of affective commitment, continuance commitment and negative affectivity in the pay satisfaction–turnover relationship.
Keywords affective commitment, continuance commitment, moderated mediation, negative affectivity, pay satisfaction, turnover
Employees’ satisfaction with their pay is a key factor that may help organizations achieve their goals (Heneman and Judge, 2000; Milkovitch and Newman, 2004; Rynes et al., 2004). In particular, pay is an important means of encouraging employee retention (Lum et al., 1998; Tekleab et al., 2005). However, the contribution of pay to employee retention has been found to be mediated by attitudinal variables, an important one being pay satis- faction (Cohen and Gattiker, 1994; Tekleab et al., 2005). Pay satisfaction represents the ‘amount of overall positive or negative affect (or feelings) that individuals have toward their pay’ (Miceli and Lane, 1991: 246) and is an important indicator of the relative will- ingness of employees to stay with or to leave their employer (Currall et al., 2005; Tekleab et al., 2005). Organizations thus have a vested interest in seeing their employees satisfied with their pay. Scholars have demonstrated that pay satisfaction emerges from a variety of aspects of compensation such as pay level, pay raise, pay administration and structure, and benefits (Heneman and Schwab, 1985; Judge and Welbourne, 1994; Scarpello et al., 1988), all of which contribute to the overall construct of pay satisfaction.
Although research has provided evidence supporting a negative relationship between pay satisfaction and employee turnover (e.g. Tekleab et al., 2005; Williams et al., 2006), the exact mechanisms through which pay satisfaction is likely to affect turnover behavior remain unclear and are only partly uncovered. As a first contribution, this study exam- ines the role of affective and continuance organizational commitments as mediators of the relationship between pay satisfaction and voluntary turnover. Although some studies have examined the pay satisfaction–commitment–turnover relationship, most of them have addressed intended (e.g. DeConinck and Stilwell, 2004; Lum et al., 1998; Vandenberghe and Tremblay, 2008) rather than actual (e.g. DeConinck, 2009; DeConinck and Bachmann, 2005) turnover. Moreover, to our knowledge, prior research has largely focused on affective commitment as a mediator (e.g. DeConinck, 2009; DeConinck and Bachmann, 2005). One study examined the mediating role of other commitment forms, and that study found continuance commitment to mediate a negative relationship between pay satisfaction and turnover intention (Vandenberghe and Tremblay, 2008). The present study extends this research, first by looking at actual turnover as the outcome, and sec- ond by examining both affective and continuance commitment as mediators of the pay satisfaction–turnover relationship. Affective commitment denotes ‘an emotional attach- ment to, identification with, and involvement in the organization’, and continuance com- mitment denotes ‘the perceived costs associated with leaving the organization’ (Meyer et al., 2002: 21). While pay satisfaction may enhance employees’ emotional bond with the organization (i.e. affective commitment), we make the point that it likely also affects
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individuals’ recognition that there are costs associated with leaving (i.e. continuance commitment). More specifically, higher levels of pay satisfaction may go along with the perception that compensation and associated benefits are high, which should lead to appraising the advantages that would be lost in case of departure to be higher. Thus, pay satisfaction should be positively related to both affective and continuance commitment. As affective and continuance commitment are associated with reduced turnover (Meyer et al., 2002), it seems reasonable to expect these commitment forms to at least partially mediate a negative relationship between pay satisfaction and turnover.
We also extend prior research on the relationship between pay satisfaction and turno- ver (e.g. Vandenberghe and Tremblay, 2008) by examining the moderating role of nega- tive affectivity (NA). Specifically, we account for the role of NA in how pay satisfaction relates to affective and continuance commitment and turnover. NA represents the dispo- sitional tendency to experience negative emotions such as feeling distressed, fearful and guilty (Thoresen et al., 2003; Watson et al., 1988). Individuals high in NA generally develop pessimistic views of the world (Bowling et al., 2008; Weiss and Cropanzano, 1996), and tend to be more reactive to negative cues in their environment (Watson et al., 1999). This is reflected in research reporting NA to be associated with more stressors (Spector et al., 1999) and strain (Barsky et al., 2004).
In this study, we examined three ways through which NA may influence the pay satisfaction–commitment–turnover relationships: as a moderator of the indirect relation- ship through affective commitment, as a moderator of the indirect relationship through continuance commitment and as a moderator of the direct relationship of pay satisfaction to turnover. First, as NA reflects a stable tendency to experience negative emotions and respond to negative cues, it may weaken the (expected) positive relationship between pay satisfaction and affective commitment and the (expected) negative relationship between affective commitment and subsequent turnover behavior. Second, as NA is likely related to a magnification of the cost of leaving, the (expected) positive relation- ship of pay satisfaction to continuance commitment and the (expected) negative relation- ship of continuance commitment to turnover may be stronger among high-NA individuals. Third, as pay satisfaction is likely to exert some direct effect on turnover, this direct negative relationship may also be moderated by NA. More precisely, higher levels of pay satisfaction may result in less likelihood of turnover among high-NA individuals as these people are particularly sensitive to, and fear, resource loss (Thoresen et al., 2003; Watson et al., 1999).
In sum, the present study intends to make two important contributions to our under- standing of the pay satisfaction–turnover relationship. First, we examine whether affec- tive and continuance commitment mediate this relationship, which would provide evidence of two distinct psychological mechanisms, one based on an emotional bond and one based on a recognition of the cost of leaving, through which pay satisfaction impacts turnover. Second, we examine a boundary condition associated with pay satisfaction’s direct and indirect relationships with turnover by investigating NA as a moderator. In the next few sections, we discuss our moderated mediation research model (see Figure 1) and hypotheses. We first develop the hypotheses regarding the mediating role of affec- tive and continuance commitment in the pay satisfaction–voluntary turnover relationship as well as the residual relationship of pay satisfaction to turnover. Then, we proceed to
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discussing the moderating role of NA in these relationships. This is followed by a descrip- tion of the methodology and results of our study. We conclude with a discussion of the implications of our findings, together with the study’s limitations.
Hypotheses development
Pay satisfaction, commitment and turnover
While scant attention has been paid in the literature to the relationship of pay satisfaction to turnover, prior efforts in this area suggest that this relationship is partially mediated by organizational commitment. Indeed, the few studies conducted so far found commit- ment, along with turnover cognitions, to mediate the relationship of pay satisfaction, or some of its facets, to turnover (e.g. DeConinck, 2009; DeConinck and Bachmann, 2005). These studies mostly focused on affective commitment. The rationale for expecting affective commitment to mediate the pay satisfaction–turnover relationship is rooted in a social exchange explanation (Blau, 1964). That is, feeling satisfied with one’s pay may instill the perception that the organization recognizes and values one’s contribution to its welfare. In doing so, the organization fulfills socio-emotional needs of the employee, such as the need for recognition or esteem. In exchange for this experience, employees are thought to identify with the goals and values of the organization, ultimately reducing the intention to look for a job elsewhere (Meyer and Allen, 1997).
We contend that pay satisfaction also relates to continuance commitment. Reflecting a recognition of the value of organizational membership and the sacrifice that would result from giving up associated advantages (i.e. valued benefits and perks) (Meyer and Allen, 1997), continuance commitment is likely related to the individual’s level of pay satisfaction. An individual who considers his or her pay to be satisfying is implicitly
→ H3a → / H3b →
H4
H2
→ H1b →
Negative affectivity
+
Pay satisfaction
–
Turnover Continuance commitment −
–
+
Affective commitment
→ H1a →
Figure 1. Theoretical model for the study.
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attributing an instrumental value to the pay received and perceives it to be favorable compared with significant referent groups (Currall et al., 2005; Jones et al., 1999; Law and Wong, 1998). Therefore, high levels of pay satisfaction should increase the percep- tion that leaving the organization results in a loss of valued resources. Our contention is consistent with prior research suggesting that pay satisfaction contributes to continuance commitment (Vandenberghe and Tremblay, 2008).
Research has provided evidence that, like its affective counterpart, continuance com- mitment is associated with reduced turnover (Meyer et al., 2002). While continuance commitment’s initial conceptualization included both the perceived cost of leaving (the ‘perceived sacrifice’ subdimension) and the perceived lack of employment alternatives (the ‘lack of alternatives’ subdimension), its negative relationship with turnover is greater when continuance commitment is captured via its perceived sacrifice component and excludes its lack of alternatives facet (e.g. Bentein et al., 2005; Lapointe et al., 2011). Conceived this way, continuance commitment falls in the range of calculative forces that strengthen the expectancy of achieving one’s goals and values through continued mem- bership in the organization (Maertz and Campion, 2004). It also parallels the sacrifice component of job embeddedness, which refers to ‘the perceived cost of material or psy- chological benefits that may be forfeited by leaving a job’ (Mitchell et al., 2001: 1105).
This study concentrates on the perceived sacrifice aspect of continuance commitment, which has been recognized by several scholars as reflecting the core essence of the con- struct (e.g. Powell and Meyer, 2004), while the few alternatives component is thought to be distinctive but weakly related to turnover (e.g. Bentein et al., 2005). We propose that continuance commitment mediates the relationship of pay satisfaction to turnover based on a cognitive, calculative process. Specifically, we argue that the cognitive appraisal of one’s pay, which determines pay satisfaction, contributes to one’s evaluation of the costs associated with leaving the organization (i.e. continuance commitment), thus reducing the likelihood of voluntary turnover as one seeks to avoid these costs. As such, continu- ance commitment reflects the operation of a cognitive process that makes the cost of leaving a salient factor reducing turnover likelihood.
Meyer and Allen’s (1997) three-component model of commitment comprises a third commitment mindset, normative commitment, which represents a bond based on a sense of obligation toward the organization. This felt obligation likely derives from the percep- tion that one has received something that is not yet reciprocated. As pay satisfaction involves the cognitive judgment that one is fairly compensated for the job done, this appraisal should not induce felt indebtedness. Furthermore, normative commitment typi- cally correlates strongly with affective commitment and has been found to add little to the prediction of turnover beyond the effect of affective commitment (e.g. Culpepper, 2001; Jaros, 1997; Lapointe et al., 2011). For these reasons, we do not in this study for- mulate hypotheses with regards to this particular commitment mindset. However, in order to provide a more comprehensive picture of the role of the different commitment mindsets in the pay satisfaction–turnover relationship, we included normative commit- ment on an exploratory basis in our analyses.
In sum, we argue that affective and continuance commitment constitute two distinct mechanisms, one affective and the other calculative in nature, through which pay satis- faction leads to turnover. We thus propose the following hypotheses:
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Hypothesis 1a: Affective commitment mediates a negative relationship between pay satisfaction and subsequent turnover. Hypothesis 1b: Continuance commitment mediates a negative relationship between pay satisfaction and subsequent turnover.
The relationship of pay satisfaction to turnover is, however, unlikely to be fully medi- ated by affective and continuance commitment. Indeed, pay satisfaction is a facet of job satisfaction, which represents an emotional reaction to the work environment that impacts membership decisions independently from commitment states. Thus, emotions associated with pay satisfaction, such as joy, pleasure and enthusiasm when pay satisfac- tion is high and frustration and anger when it is low, likely have unique implications for the decision to stay with/leave the organization. Empirical evidence supports the role of pay satisfaction as a driver of membership decisions: in a study of the organizational outcomes of pay satisfaction among school districts, Currall et al. (2005) found that aggregate pay satisfaction was directly and negatively related to teacher turnover inten- tions. Similarly, Lum et al. (1998) and DeConinck and Stilwell (2004) found that the relationship of pay satisfaction to turnover intention was only partly mediated by affec- tive commitment. Meta-analytic results also show job satisfaction to be uniquely related to turnover (Tett and Meyer, 1993). In this study, we thus expect to find a direct relation- ship between pay satisfaction and turnover, in addition to the mediated relationships hypothesized above. This leads to the following hypothesis:
Hypothesis 2: Pay satisfaction is directly and negatively related to subsequent turnover.
The moderating role of negative affectivity
NA refers to the dispositional tendency to experience negative emotions, such as feeling distressed and fearful (Thoresen et al., 2003; Watson et al., 1988). High-NA individuals are biased toward attending to, encoding and retrieving information of negative valence (Bowling et al., 2008; Weiss and Cropanzano, 1996). This cognitive bias represents the foundation upon which expectations of negative treatment by the organization are cre- ated and ‘infuse’ the cognitive evaluation of attitude objects as well as behavioral pro- cesses (Forgas and George, 2001). NA is also inherently related to the operation of the behavioral inhibition system (BIS). The BIS is responsible for avoidance behaviors, reflects a sensitivity and hypervigilance toward punishment, and tends to engender nega- tive emotions; it has its counterpart in the behavioral activation system (BAS), which responds to positive incentives (Gray, 1970; Watson et al., 1999). Based on this theory, high NA-individuals should be more reactive to negative stimuli (i.e. punishment), and less reactive to positive stimuli (i.e. rewards) than those low on this trait.
NA may affect the relationships between pay satisfaction and affective commitment, and between affective commitment and turnover. Specifically, we contend that these relationships are weaker among individuals with high levels of NA. First, high-NA indi- viduals should be less reactive to pay satisfaction than low-NA employees, as this (posi- tive or negative) feeling is associated with a reward (i.e. compensation), rather than a
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punishment. As high NA-individuals are thought to be less reactive to reward stimuli, pay satisfaction should be less influential on their level of affective commitment, than it is for low-NA individuals.
Second, affective commitment may weigh less heavily on high-NA individuals’ deci- sion to stay or leave the organization, given that NA reflects a relatively stable tendency to experience negative emotions (Thoresen et al., 2003) and affective commitment is a situationally determined affective response to the organization, likely to fluctuate over time (e.g. Bentein et al., 2005). Simply put, as high-NA individuals experience negative affect on a regular basis, the strength of their affective bond with their employing organi- zation at a specific point in time is likely to be less salient as a driver of membership decisions. In other words, high-NA individuals are likely to be overwhelmed by negative emotions that would blur affective commitment’s value as a force that drives retention/ turnover decisions. In sum, we propose that among individuals high in NA, pay satisfac- tion is less strongly related to affective commitment and that affective commitment is less strongly related to turnover than among individuals low on this trait. The above reasoning implies that the indirect effect of pay satisfaction on turnover via affective commitment should be weaker among high-NA individuals. This leads to the following hypothesis:
Hypothesis 3a: NA moderates the first and the second stage of the indirect (negative) relationship of pay satisfaction to subsequent turnover through affective commitment such that this relationship is weaker when NA is high.
NA may also affect the relationships between pay satisfaction and continuance com- mitment, and between continuance commitment and turnover. Specifically, we contend that these relationships are stronger among individuals high on NA. First, among high- NA individuals, the instrumental value of pay satisfaction may be magnified, as high-NA individuals may exaggerate the fear associated with material and psychological losses. Indeed, high NA individuals have a cognitive bias toward magnifying ‘the experience of loss’ (Thoresen et al., 2003). High-NA individuals may thus attribute greater instrumen- tal value to pay satisfaction, leading them to interpret high levels of pay satisfaction as suggesting that they would have much to lose in case of departure (i.e. continuance commitment). This implies the relationship between pay satisfaction and continuance commitment should be stronger among high-NA individuals.
Furthermore, perceiving the cost of leaving to be high (i.e. experiencing high levels of continuance commitment) may in itself be stressful for individuals high on NA, making continuance commitment more salient and influential on turnover behavior. Indeed, peo- ple high in NA also often engage in hypervigilance with respect to their social environ- ment, and are more sensitive to the instrumental ties they have with significant others (Mikulincer and Shaver, 2005). High-NA individuals also report more stressors (Spector et al., 1999) and more strain at work (Barsky et al., 2004) than their low-NA counterparts. Continuance commitment may thus weigh more strongly on the decision to stay or leave – in other words, be more strongly related to turnover behavior – among individuals with high levels of NA. A logical implication of the preceding reasoning is that the indirect
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effect of pay satisfaction on turnover through continuance commitment should be stronger among employees with high levels of NA. This leads to the following hypothesis:
Hypothesis 3b: NA moderates the first and the second stage of the indirect (negative) relationship of pay satisfaction to subsequent turnover through continuance commit- ment such that this relationship is stronger when NA is high.
Lastly, NA may moderate the direct relationship between pay satisfaction and turno- ver. As we argued above, previous research suggests the relationship of pay satisfaction to turnover is only partially mediated by affective or continuance commitment (Currall et al., 2005; DeConinck and Stilwell, 2004; Lum et al., 1998). A direct relationship between pay satisfaction and turnover is expected because pay satisfaction captures a facet of job satisfaction, which represents an emotional reaction to the work environment that may have consequences on membership decisions on its own (Tett and Meyer, 1993). We argue that the relevance of pay satisfaction as an immediate precursor of turnover may be strengthened by NA. Indeed, as NA is tied to the operation of the BIS (Thoresen et al., 2003; Watson et al., 1999), high-NA individuals may tend to avoid leav- ing when they have positive experiences at work (such as when they experience high levels of pay satisfaction) because leaving would be perceived as stressful in this case. Thus, they should be inclined to avoid finding themselves in such a situation. This sug- gests that the direct relationship between pay satisfaction and turnover should be stronger among high-NA employees. In other words, leaving when one experiences a pleasant situation would cause more stress and frustration among high-NA people. This is in line with the view that the experience of loss (i.e. leaving a pleasurable job – which corre- sponds to high pay satisfaction) is more aversive among high-NA individuals (Thoresen et al., 2003), therefore resulting in less turnover likelihood. In contrast, for low-NA indi- viduals, the experience of leaving when one has positive experiences at work (such as a high level of pay satisfaction) should not be prospectively perceived as being aversive as these individuals are not prone to experience negative emotions (Watson et al., 1999). Thus, the relationship between pay satisfaction and turnover should be weaker among low-NA employees. This leads to the following, remaining hypothesis:
Hypothesis 4: NA moderates the direct (negative) relationship of pay satisfaction to subsequent turnover such that this relationship is stronger when NA is high.
Method
Sample and procedure
The study was conducted among members of an association of human resource manage- ment professionals located in Eastern Canada. With the approval of the president of this association, the study was presented as addressing members’ work attitudes. Data were col- lected using two online surveys spaced apart by 15 months. This time period was established on a convenient basis because the more conventional 12-month time interval used in
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turnover research (Griffeth et al., 2000) would have resulted in our Time 2 measurement of turnover to hold in June, a period of the year where many people are on vacation. Therefore, turnover measurement was postponed to September, leading to a 15-month interval between Time 1 and Time 2. The first survey was attached to a larger survey developed by the target association that addressed members’ satisfaction regarding different aspects of their wages. Prospective participants (N = 2968) were assured that responses would be kept confidential and would only serve research interests. In total, 920 individuals provided usable responses at Time 1, for a 31 percent response rate. At Time 1, we measured pay satisfaction, negative affectivity and commitment variables, and collected demographic information. Organizational membership status data were collected at Time 2. Excluding 24 involuntary leavers, there remained 509 subjects in the sample at Time 2 for data analysis. In this final sample, 63.5 percent of respondents were female, 36.2 percent were between 18 and 35 years old, 47.3 percent were between 35 and 49 years old, and 16.5 percent were 50 years and older; and average tenure with the organization was 3.15 years (SD = 1.70). Actual pay level was distributed as follows: less than $30,000$ (0.2%), $30,000–$39,999 (4.5%), $40,000–$49,999 (13.6%), $50,000–$59,999 (13.8%), $60,000–$69,999 (15.9%), $70,000– $79,999 (14.5%), $80,000–$89,999 (12.2%), $90,000–$99,999 (6.7%), $100,000+ (13.8%); 4.9 percent of the respondents did not report this information.
To determine whether subject attrition led to non-random sampling, we tested whether the probability of remaining in the sample at Time 2 (N = 509) among Time 1 respond- ents (N = 920) could be predicted by demographics and substantive variables (Goodman and Blum, 1996). The logistic regression predicting the probability of remaining in the sample at Time 2 was non-significant (χ2 [9] = 8.11, NS, Nagelkerke R2 = .01), and age (B = .01, NS), sex (B = −.17, NS), organizational tenure (B = .00, NS), pay level (B = .08, NS), negative affectivity (B = −.16, NS), pay satisfaction (B = −.12, NS), affective com- mitment (B = .04, NS), continuance commitment (B = .03, NS) and normative commit- ment (B = −.04, NS) were all non significant in the model. This indicates that respondent attrition was essentially random.
Measures
A five-point Likert-type scale (1 = strongly disagree; 5 = strongly agree) was used for all items.
Pay satisfaction. The 18-item version of the Pay Satisfaction Questionnaire (PSQ; Hene- man and Schwab, 1985) was used for this study. The PSQ asks respondents to rate their level of satisfaction with regard to four facets of pay: pay level (four items; e.g. ‘My current salary’; α =.96), benefits (four items; e.g. ‘The value of my benefits’; α =.95), pay raise (four items; e.g. ‘My most recent raise’; α =.90) and pay structure and administra- tion (six items; e.g. ‘The company’s pay structure’; α =.93). As these four facets were highly correlated with one another in this study (as in many others) (rs: .53–.77), we retained a single overall pay satisfaction latent variable. In our confirmatory factor analy- ses (see Results section), overall pay satisfaction was defined by one aggregate indicator per pay satisfaction facet (for a similar approach, see Currall et al., 2005). The alpha coefficient calculated on the 18 PSQ items was .96.
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Negative affectivity. Trait negative affectivity was measured via Watson et al.’s (1988) 10-item scale. Presented to respondents as ‘statements about personal characteristics’, negative affectivity scale items (i.e. adjectives) were preceded by the phrase ‘In general, I feel . . .’. A sample item is ‘upset’ (α =.83).
Organizational commitment. We used Bentein et al.’s (2005) adapted version of Meyer et al.’s (1993) organizational commitment scales, which include affective commitment (six items; e.g. ‘I really feel that I belong in this organization’; α = .90), normative com- mitment (six items; e.g. ‘I think I would be guilty if I left my current organization now’; α = .89) and the perceived sacrifice facet of continuance commitment, which represents the core essence of continuance commitment (Powell and Meyer, 2004) (three items; e.g. ‘I would not leave this organization because of what I would stand to lose’; α = .74). Normative commitment was used as a control in regression analyses.
Turnover. We tracked respondents 15 months after the Time 1 survey to determine whether they had remained with their organization or left (0 = Stay; 1 = Voluntary turnover). Among the initial sample of 920 individuals at Time 1, we obtained turnover information for 533 of them at Time 2. Excluding 24 employees who had left their organization invol- untarily between Time 1 and Time 2, there remained 509 individuals in the sample at Time 2. Among them, 88 voluntarily left their organization during the course of the study, for a voluntary turnover rate of 17.3 percent (88/509). Turnover information was cross- checked with the professional association’s archival data, with no discrepancy being found.
Control variables. We controlled for age, sex and tenure in our analyses as prior research had found them to correlate, albeit slightly, with turnover (Griffeth et al., 2000). We also controlled for actual pay level as this variable may represent a potential confound in analyses predicting turnover (Trevor et al., 1997).
Results
Confirmatory factor analyses
The dimensionality of our data was examined through a confirmatory factor analysis of all our attitudinal constructs (negative affectivity, pay satisfaction and commitment vari- ables) using LISREL. A covariance matrix was used as input and the estimation of mod- els was conducted via the maximum likelihood method. To reduce the complexity of our measurement model (i.e. a total of 43 items), we combined items to create three indica- tors per construct for those measured by more than three items, except for pay satisfac- tion for which four indicators were created (i.e. one indicator per pay satisfaction facet) (Landis et al., 2000). This resulted in a 16-indicator covariance matrix. We then tested and compared our theoretical model against more parsimonious solutions using χ² differ- ence tests (Bentler and Bonett, 1980).
As can be seen from Table 1, the hypothesized five-factor model comprising pay sat- isfaction, NA and the three commitment dimensions yielded a good fit to the data: χ² (94) = 239.87, p < .001, NNFI = .97, CFI = .98, RMSEA = .058. This model proved superior
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T a b
le 1
. C
o nf
ir m
at o ry
f ac
to r
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ys is
o f m
ea su
re m
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m o de
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it in
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s.
M o de
l χ2
d. f.
Δ χ
2 Δ
d .f.
N N
FI C
FI R
M SE
A
H yp
o th
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ed f iv
e- fa
ct o r
m o de
l 23
9. 87
* 94
– –
.9 7
.9 8
.0 58
Fo ur
-f ac
to r
m o de
ls
C o m
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eg at
iv e
af fe
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71 6.
94 *
98 47
7. 07
* 4
.8 8
.9 0
.1 20
C
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73 8.
70 *
98 49
8. 83
* 4
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C
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74 4.
16 *
98 50
4. 29
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.8 8
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.1 20
C
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ay s
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io n
an d
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m m
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en t
10 87
.8 3*
98 84
7. 96
* 4
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.8 4
.1 60
C
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11 49
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98 39
2. 79
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.8 4
.1 60
C
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ay s
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65 1.
77 *
98 41
1. 90
* 4
.8 9
.9 1
.1 10
O ne
-f ac
to r
m o de
l 24
89 .8
5* 10
4 22
49 .9
8* 10
.5 7
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.2 40
N ot
e: N
= 4
73 (
lis tw
is e
de le
ti o n)
. N N
FI =
n o n-
no rm
ed f it in
de x;
C FI
= c
o m
pa ra
ti ve
f it in
de x;
R M
SE A
= r
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< .0
01 .
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(p < .001) to any more parsimonious representation of the data, including a series of four- factor models and a one-factor model (see Table 1). These results provide evidence of the distinctiveness of the study’s variables.
Descriptive statistics and intercorrelations
Descriptive statistics, correlations among variables and alpha coefficients are presented in Table 2. As can be seen, all variables displayed good internal consistency (αs > .74). Of substantive interest, NA was weakly negatively correlated with pay satisfaction (r = −.11, p < .05). Moreover, pay satisfaction was positively associated with affective and continuance commitment (r = .44, p < .01, and r = .30, p < .01, respectively) and nega- tively associated with turnover (r = −.23, p < .01). Finally, affective and continuance commitment were negatively associated with turnover (r = −.26, p < .01, and r = −.23, p < .01, respectively).
Logistic regression
We first run a moderated logistic regression using turnover as the dependent variable. We entered control variables (age, sex, tenure and pay level) at Step 1, followed by centered NA and pay satisfaction at Step 2 (see Aiken and West, 1991). The pay satisfaction × NA product term was entered at Step 3 while the three commitment variables were intro- duced at Step 4. Results are presented in Table 3. As can be seen, the full model contrib- uted significant variance in turnover, χ² (10) = 80.27, p < .001, -2LL = 317.51, Nagelkerke R2 = .28. Interestingly, pay satisfaction was negatively related to turnover at Step 2 (B = −.84, p < .001) as was the NA × pay satisfaction interaction term at Step 3 (B = −1.01, p < .05). The significance of these coefficients suggests that these variables are associ- ated with a reduced likelihood of leaving the organization. Table 3 also reports the odds ratios (or Exp(B)) associated with the (unstandardized) logistic regression coefficients. The odds ratio represents the factor by which the probability of leaving is multiplied for each unit increase in the independent variable. Odds ratios that are significantly below unity are associated with a reduction in turnover likelihood. Finally, at Step 4, affective and continuance commitment were significant predictors of turnover (B = −0.68, p < .01 and B = −0.48, p < .05, respectively) while the NA × pay satisfaction interaction remained significant (B = −1.00, p < .05) and pay satisfaction dropped to non significance (B = −0.35, NS). Incidentally, normative commitment was also unrelated to turnover (B = 0.09, NS). Together, these findings suggest that pay satisfaction, NA and affective and continuance commitment are involved in moderated and mediated relationships.
Hypothesis tests
Hypotheses were tested using an analytical framework that combines moderation and mediation (Edwards and Lambert, 2007). Indeed, as can be seen from Figure 1, our model predicts that NA will moderate (a) the path from pay satisfaction (i.e. X) to turno- ver (i.e. Y) (direct effect), (b) the paths from pay satisfaction (i.e. X) to affective and continuance commitment (i.e. M1 and M2) (first stage of the indirect effect), and the paths
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Panaccio et al. 833
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834 Human Relations 67(7)
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Panaccio et al. 835
from affective and continuance commitment to turnover (second stage of the indirect effect). This model can be tested using Edwards and Lambert’s general framework, which incorporates moderated regression and path analysis. Testing our moderated mediation model first involves estimating the following three equations:
M a a X a Z a XZ eM M X M Z M XZ M1 01 1 1 1 11 1 1 1 1= + + + +
(1)
M a a X a Z a XZ eM M X M Z M XZ M2 02 2 2 2 22 2 2 2 2= + + + +
(2)
Y b b X b M b M b Z b XZ b M Z b M Z eX M M Z XZ M Z M Z Y= + + + + + + + +03 3 3 1 3 2 3 3 3 1 3 2 31 2 1 2
(3)
Equation 1 examines whether Z (i.e. negative affectivity) moderates the effect of X (i.e. pay satisfaction) on M1 (i.e. affective commitment); Equation 2 examines whether Z moderates the effect of X on M2 (i.e. continuance commitment); and Equation 3 captures the moderating effect of Z on the relationships of X, M1 and M2 to Y (i.e. voluntary turno- ver). The coefficients on X (i.e. bX3), M1 (i.e. bM
1 3), M2 (i.e. bM
2 3) and Z (i.e. bZ3) indicate
the effect of pay satisfaction, affective commitment, continuance commitment and NA, respectively, on turnover. The coefficient on XZ (i.e. bXZ3) estimates the moderating effect of NA on the relationship of pay satisfaction to turnover, whereas the coefficients on M1Z (i.e. bM1Z3) and M2Z (i.e. bM2Z3) estimate the moderating effect of NA on the rela- tionship of affective and continuance commitment, respectively, to turnover. Finally, substituting Equations 1 and 2 into Equation 3 gives the following reduced form equa- tion for the total effect moderation model (this equation contains the compound coeffi- cients necessary for the calculation of simple effects [i.e. simple paths, and indirect and total effects]):
Y b b Z a a Z b b Z a a Z bZ M M Z M M Z M M Z M= + + + + + +03 3 01 1 3 3 02 2 31 1 1 1 2 2 2( )( ) ( )( ++
+ + + + +
+
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)( )
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(4)
For our purposes, Equation 4 includes the compound coefficients that reflect the indi- rect effect of pay satisfaction on turnover through affective commitment [(aM1X1+ aM1XZ1Z) (bM13+ bM1Z3Z)] and continuance commitment [(aM2X2+ aM2XZ2Z)(bM23+ bM2Z3Z)] as well as the direct effect of pay satisfaction on turnover (bX3+ bXZ3Z). The total effect of pay satisfaction on turnover is thus expressed by the combination of all three com- pound terms.
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836 Human Relations 67(7)
Using the regression syntax provided by Edwards and Lambert (2007: 22), we esti- mated the coefficients for Equations 1, 2 and 3, controlling for age, sex, tenure and pay level, on the full sample of our data using SPSS 17.0. However, as our dependent varia- ble (turnover) was dichotomous, we modified the syntax that was intended to estimate the coefficients for Equation 3 into syntax for binary logistic regression. Using these results, we applied SPSS’s constrained non-linear regression (CNLR) procedure (see Edwards and Lambert, 2007) to estimate coefficients (for Equations 1, 2 and 3) for 1000 bootstrap samples. These coefficients were tested using bias-corrected confidence inter- vals. Then, formulas from Equation 4 were entered into an Excel file (see Edwards and Lambert, 2007) so as to compute simple paths, and indirect and total effect (i.e. all ‘sim- ple effects’) at high and low levels of the moderator (i.e. NA) based on coefficient esti- mates for the full sample and the bootstrap samples. Effects were computed at one standard deviation above and below the mean of NA (i.e. the moderator) (see Aiken and West, 1991). Finally, we computed differences among simple effects across levels of the moderator using formulas provided in Edwards and Lambert’s Excel file. Significance of these effects was tested using 95 percent bias-corrected confidence intervals, with sig- nificance being reputed to be achieved when the interval does not include zero.
Coefficient estimates associated with Equations 1 and 2 are presented in Table 4, while those for Equation 3 are reported in Table 5. As can be seen, pay satisfaction was significantly and positively associated with affective commitment (aM
1 X1 = .50, p < .001;
Table 4), while affective commitment was negatively related to turnover (bM 1 3 = −.07, p
< .001; Table 5). Moreover, using a bootstrap approach, the indirect, negative relation- ship of pay satisfaction to turnover through affective commitment was found to be sig- nificant (−.035, 95% CI = −.059, −.029). Therefore, Hypothesis 1a is supported. Similarly, pay satisfaction was positively related to continuance commitment (aM2X2 = .42, p < .001; Table 4) and continuance commitment was negatively related to turnover (bM23 = −.06, p < .001; Table 5). Using a similar bootstrap approach, the indirect, negative relationship of pay satisfaction to turnover through continuance commitment was found to be significantly negative (−.023, 95% CI = −.036, −.013). Hypothesis 1b is thus also supported. Finally, Table 5 reveals that pay satisfaction also had a direct and negative relationship with turnover (bX3 = −.04, p < .05). Hypothesis 2 is thus confirmed.
Table 4. Estimates for coefficients from Equations 1 and 2.
Mediator variable aM1X1 aM2X2 aM1Z1 aM2Z2 aM1XZ1 aM2XZ2 R 2
Affective commitment (M1) .50*** −.10 −.09 .20 Continuance commitment (M2) .42*** .26*** .19* .12
Note: Entries are unstandardized coefficient estimates from Equations 1 and 2, which use affective commitment and continuance commitment, respectively, as the dependent variable; aM1X1 and aM2X2 refer to the effects of pay satisfaction on affective commitment and continuance commitment, respectively; aM1Z1 and aM2Z2 refer to the effects of NA on affective commitment and continuance commitment, respectively; and aM1XZ1 and aM2XZ2 refer to the interaction of pay satisfaction with NA on affective commitment and continuance commitment, respectively. Coefficients are estimated using OLS (ordinary least-squares) regression and the constrained nonlinear regression (CNLR) procedure (Edwards and Lambert, 2007). The significance of coefficient esti- mates was tested using bias-corrected confidence intervals as derived from 1000 bootstrap estimates. *p < .05; **p < .01; ***p < .001.
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Panaccio et al. 837
As shown in Tables 4 and 5, respectively, pay satisfaction did not interact with NA in predicting affective commitment (aM1XZ1 = −.09, NS) but affective commitment inter- acted with NA in predicting turnover (bM1Z3 = .05, p < .01). To further probe into these relationships, Table 6 presents the simple effects and their differences across low and high levels of NA. As can be seen, the path from pay satisfaction to affective commit- ment (i.e. first stage of the indirect effect) was significant and positive both at high (aM1X1+ aM1XZ1Z = .46, p < .001) and low (aM1X1+ aM1XZ1Z = .55, p < .001) levels of NA. However, the two paths did not differ significantly from one another (difference = −.09, NS). In contrast, the path from affective commitment to turnover (i.e. second stage of the indirect effect) was non significant at high levels of NA (bM13+ bM1Z3Z = −.05, NS) and
Table 6. Analysis of simple effects.
Negative affectivity Affective commitment Continuance commitment
Stage Effect Stage Effect
First Second Direct Indirect Total First Second Direct Indirect Total
High .46*** −.05 −.10** −.02 −.12*** .52*** −.08** −.10** −.04** −.14***
Low .55*** −.09*** .02 −.05*** −.04* .32*** −.04* .02 −.01* .00 Differences −.09 .05** −.11* .03*** −.09 .19* −.04 −.11* −.03† −.14**
Note: First stage coefficients refer to effects of pay satisfaction on affective versus continuance commitment at high versus low levels of NA; second stage coefficients refer to effects of affective versus continuance com- mitment on turnover at high versus low levels of NA; direct effect coefficients refer to direct effects of pay satisfaction on turnover at high versus low levels of NA; indirect effect coefficients refer to effects of pay sat- isfaction on turnover via affective versus continuance commitment at high versus low levels of NA; and total effects refer to effects of pay satisfaction on turnover directly and via affective versus continuance commit- ment at high versus low levels of NA. For rows labeled High and Low, entries are simple effects computed using coefficient estimates from Tables 4 and 5 (obtained through OLS and logistic regression and the CNLR procedure). Z = −.49 and .50 for low and high negative affectivity, respectively (i.e. one standard deviation above and below the mean of the centered negative affectivity variable). Differences in simple effects were computed by subtracting the effects for low negative affectivity from the effects for high negative affectivity. Tests of differences for the first stage, second stage and direct effects are equivalent to tests of aM1XZ1, aM2XZ2, bXZ3, bM1Z3, and bM2Z3, respectively, as reported in Tables 4 and 5. Tests of differences for simple effects were based on bias-corrected confidence intervals as obtained from 1000 bootstrap estimates. †p < .10; *p < .05; **p < .01; ***p < .001.
Table 5. Estimates for coefficients from Equation 3.
bX3 bM13 bM23 bZ3 bXZ3 bM1Z3 bM2Z3 R 2
−.04* −.07*** −.06*** .05 −.12* .05** −.04 .14
Note: Entries are unstandardized coefficient estimates from Equation 3, which uses turnover as the dependent variable; bX3 refers to the effect of pay satisfaction; bM13 and bM23 represent the effects of affective and continu- ance commitment, respectively; bZ3 refers to the effect of NA; bXZ3 represents the effect of the interaction between pay satisfaction and NA; and bM1Z3 and bM2Z3 refer to the interactions between affective and continu- ance commitment, respectively, and NA. Coefficients are estimated using logistic regression and the constrained nonlinear regression (CNLR) procedure (Edwards and Lambert, 2007). The significance of coefficient estimates was tested using bias-corrected confidence intervals as derived from 1000 bootstrap estimates. *p < .05; **p < .01; ***p < .001.
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838 Human Relations 67(7)
significant and negative at low levels of NA (bM13+ bM1Z3Z = −.09, p < .001), and the dif- ference between the two was significant (difference =.05, p < .01). Moreover, the indirect effect of pay satisfaction on turnover through affective commitment was non-significant at high levels of NA [(aM1X1+ aM1XZ1Z) (bM13+ bM1Z3Z) = −.02, NS] and significantly nega- tive at low levels of NA [(aM1X1+ aM1XZ1Z) (bM13+ bM1Z3Z) = −.05, p < .001], and the dif- ference between the two was significant (difference = .03, p < .001). Therefore, Hypothesis 3a is partly supported. Figure 2 depicts the relevant moderated indirect effect. As can be seen, the probability of turnover decreases more strongly as pay satisfaction increases when NA is high than when it is low.
Tables 4 and 5 show that pay satisfaction interacted with NA in predicting continu- ance commitment (aM2XZ2 = .19, p < .05) but that continuance commitment did not inter- act with NA in predicting turnover (bM2Z3 = −.04, NS). As can be seen from Table 6, the path from pay satisfaction to continuance commitment (i.e. first stage of the indirect effect) was significant and positive both at high (aM2X2+ aM2XZ2Z = .52, p < .001) and low (aM2X2+ aM2XZ2Z = .32, p < .001) levels of NA, and the two paths differed significantly from one another (difference = .19, p < .05). Similarly, the path from continuance com- mitment to turnover (i.e. second stage of the indirect effect) was significant both at high (bM23+ bM2Z3Z = −.08, p < .01) and low (bM23+ bM2Z3Z = −.04, p < .05) levels of NA; how- ever, the difference between the two was non-significant (difference = −.04, NS). Importantly, the indirect effect of pay satisfaction on turnover through continuance com- mitment was significant both at high [(aM2X2+ aM2XZ2Z) (bM23+ bM2Z3Z) = −.04, p < .01] and low [(aM2X2+ aM2XZ2Z) (bM23+ bM2Z3Z) = −.01, p < .05] levels of NA, and the difference between the two was marginally significant (difference = −.03, p < .10). Therefore, Hypothesis 3b is partly supported. Figure 3 depicts the relevant moderated indirect effect. As shown in the figure, the probability of turnover decreases more strongly as pay satisfaction increases when NA is high than when it is low.
0.00
0.05
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0.15
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0.25
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Pay sa�sfac�on
High NA Low NA
Figure 2. Indirect effect of pay satisfaction on turnover via affective commitment for high and low levels of NA. Intercepts and slopes are defined as [b03+bZ3Z+ (aM101+a M1Z1Z)(bM13+bM1Z3Z)] and (aM1X1+ aM1XZ1Z)(bM13+bM1Z3Z), respectively.
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Panaccio et al. 839
Finally, Table 5 shows that pay satisfaction interacted with NA in predicting turnover (bXZ3 = −.12, p < .05). The analysis of simple effects (Table 6) reveals that the direct effect of pay satisfaction on turnover was significantly negative when NA was high (bX3+ bXZ3Z = −.10, p < .01) but non-significant when NA was low (bX3+ bXZ3Z = .02, NS). Moreover, the difference between the two was significant (difference = −.11, p < .05). Hypothesis 4, which stated that the direct relationship of pay satisfaction to turnover would be stronger when NA is high, is thus supported. This moderating effect is depicted in Figure 4, which shows that the probability of turnover decreases more strongly as pay satisfaction increases when NA is high than when it is low.
Discussion
This study’s findings demonstrate that affective commitment, continuance commitment and NA play a central role in the pay satisfaction−turnover relationship. Specifically, affective and continuance commitment mediated a negative relationship between pay satisfaction and turnover. The indirect relationship of pay satisfaction to turnover via affective commitment was weaker among high-NA individuals, as affective commitment was less strongly related to turnover among those with high levels of NA. In contrast, pay satisfaction’s indirect effect on turnover via continuance commitment was stronger among high-NA individuals, as pay satisfaction was more strongly related to
0.00
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High NA Low NA
Figure 3. Indirect effect of pay satisfaction on turnover via continuance commitment for high and low levels of NA. Intercepts and slopes are defined as [b03+bZ3Z+(aM202+aM2Z2Z) (bM23+bM2Z3Z)] and (aM2X2+ aM2XZ2Z) (bM23+bM2Z3Z), respectively.
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840 Human Relations 67(7)
continuance commitment among those individuals. Lastly, pay satisfaction’s residual, direct relation to turnover was also stronger among employees with high levels of NA. This complex pattern of relationships has important implications for theory and practice. Below, we discuss these implications along with new directions of inquiry.
Theoretical implications and future directions
This study advances prior research by showing that affective and continuance commit- ment are important mediating variables in the relationship between pay satisfaction and voluntary turnover. While few prior studies had found affective commitment to mediate this relationship (DeConinck, 2009; DeConinck and Bachmann, 2005) and continuance commitment had been shown to mediate the relationship between pay satisfaction and turnover intention (Vandenberghe and Tremblay, 2008), the present study demonstrates that both of these commitment forms play independent mediating roles in the relation- ship between pay satisfaction and actual turnover behavior, controlling for normative commitment. This finding is potentially important as it suggests two distinct mecha- nisms through which pay satisfaction affects turnover decisions. Pay satisfaction, which is generally defined as the ‘amount of overall positive or negative affect (or feelings) that individuals have toward their pay’ (Miceli and Lane, 1991: 246), may actually induce cognitive as well as affective reactions to the organization. While affective commitment
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0.30
-1 -0.5 0 0.5 1
O dd
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High NA Low NA
Figure 4. Direct effect of pay satisfaction on turnover for high and low levels of NA. Intercepts and slopes are defined as [b03+bZ3Z+(a M101+a M1Z1Z)(bM13+bM1Z3Z)+(aM202+aM2Z2Z) (bM23+bM2Z3Z)] and (bX3+bXZ3Z), respectively.
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Panaccio et al. 841
represents the typical emotional reaction as directed toward the organization, continu- ance commitment is more cognitively driven (Solinger et al., 2008). It reflects the extent to which the individual perceives that he or she would incur some instrumental cost in case of leaving (Meyer and Allen, 1997). Thus, pay satisfaction may not only reduce turnover through enhancing emotional attachment to the organization, but does so also through strengthening the calculative forces that bind the individual to the organization (Maertz and Campion, 2004). In an era where the commitment literature has largely dif- fused the virtue of affective commitment (e.g. Meyer and Herscovitch, 2001), this study provides a complementary view by outlining the importance of continuance commitment.
Another important finding relates to the moderating role of NA. On the one hand, high levels of NA are associated with a weaker relationship between affective commit- ment and turnover, which results in the indirect relationship of pay satisfaction to turno- ver via affective commitment being weaker among high-NA individuals. On the other hand, high levels of NA were associated with a stronger relationship of pay satisfaction to continuance commitment, which in this case results in pay satisfaction indirectly reducing turnover more strongly. This has interesting implications, as it suggests that, among high-NA individuals, continuance commitment is the more salient mechanism through which pay satisfaction indirectly reduces voluntary turnover. Presumptively, people high in NA tend to magnify the instrumental ties with the organization as pay satisfaction increases, which leads to increased levels of continuance commitment. This may help to understand the nature of attachment to the organization among these people. For example, people high in NA tend to be hypervigilant about what they would have to lose from disrupting a relationship (Mikulincer and Shaver, 2005), suggesting attach- ment anxiety (Richards and Schat, 2011). In other words, higher levels of pay satisfac- tion may cause people high in NA to get sensitive to the value of the advantages and perks derived from organizational membership. This sensitivity to instrumental ties may reflect some sort of insecure attachment to the organization. Attachment anxiety charac- terizes people who feel insecure regarding the permanence of the relationship with their partners (Richards and Schat, 2011). A valuable avenue for research in this area would be to determine whether the stronger relationship of pay satisfaction to continuance com- mitment can be explained by increased attachment anxiety.
The weaker relationship between affective commitment and voluntary turnover among individuals high on NA casts an interesting light on the relationship between affective commitment and behavioral outcomes, as it suggests trait affectivity may not only contribute to determining the level of commitment employees tend to experience, as prior research has demonstrated (e.g. Thoresen et al., 2003), but may also influence the impact a transitory affective state, such as affective commitment, has on behaviors. Studying the interplay between affective traits and affective responses in predicting behavior may be another fruitful avenue for future research.
Finally, NA also moderated the direct relationship of pay satisfaction to turnover. This finding is interesting because it reveals another operating mechanism associated with NA. In fact, NA is tied to the operation of the BIS (Thoresen et al., 2003; Watson et al., 1999), which suggests that high-NA individuals develop avoidant strategies to cope with aversive situations (Endler and Parker, 1990; O‘Brien and DeLongis, 1996; Wong et al.,
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2006). We theorized that as high-NA individuals tend to avoid finding themselves in aversive situations, they might refrain from leaving as pay satisfaction increases. To get a finer-grained understanding of this process, it would be worth investigating whether the activation of the BIS is actually the reason why pay satisfaction leads to lower turno- ver among high-NA individuals.
An interesting extension to our study would be to examine positive affectivity (PA; i.e. a tendency to experience positive emotions, such as feeling active, energetic and enthusiastic [Thoresen et al., 2003; Watson et al., 1988]) as an additional moderator. For example, it would be worth investigating whether PA moderates the relationship of pay satisfaction to affective commitment and its indirect relationship to turnover. People high in PA, as they tend to interpret feedback from their environment in more positive terms (Bowling et al., 2008), may experience higher levels of pay satisfaction as indicating their worth to the organization (Gardner et al., 2004), thereby facilitating identification to its goals and values. Thus, it seems reasonable to expect PA to positively moderate the relationship of pay satisfaction to affective commitment and correspondingly strengthen the indirect effect of pay satisfaction on turnover through affective commitment. The presumed stronger relationship of pay satisfaction to affective commitment among indi- viduals high in PA may also be explained by the fact that these people are more capable of developing ‘secure attachment’ to significant others, including organizations (Bergman et al., 2009; Richards and Schat, 2011). Future research should thus examine what pre- cise role PA may play in pay satisfaction’s relationships to affective commitment and turnover and determine what the key driver of this role is.
Another worthwhile endeavor would be to investigate how trait NA operates longitu- dinally as a driver of membership cognitions, depending on the extent to which individu- als are satisfied with their pay. For example, people high in NA may view the experience of pay satisfaction as incongruent with their pessimistic expectations (Begley and Lee, 2005). Thus, experiencing higher levels of pay satisfaction may be unusual for them, therefore possibly prompting more extensive, substantive processing of information regarding the value of staying versus leaving the organization. People high in NA who experience high pay satisfaction may thus engage more frequently in cognitions about their extant membership in the organization. This may cause them to view leaving as being hazardous – a perspective that is consistent with their tendency to have negative expectations about the future (Cote et al., 2006) – and as comparing unfavorably with what their level of pay satisfaction tells them about their current organization. There would thus be value in exploring how cognitions about organizational membership are processed over time as a function of pay satisfaction among employees with high levels of NA.
Practical implications
In terms of practical implications, this study suggests increasing pay satisfaction may be a useful strategy to enhance affective and continuance commitment and reduce turnover. Organizations can do so by adopting fair procedures in determining pay decisions and being transparent in communicating these decisions to employees (Burnett et al., 2009; Tekleab et al., 2005; Williams et al., 2006), and ensuring that pay levels are comparable with market
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rates (Judge, 1993). Organizations may be wary of fostering continuance commitment, as research has generally reported this commitment form to be associated with few positive consequences other than increased retention, and to be less effective at promoting retention than other commitment forms (Meyer et al., 2002). However, more recent work that focused on the perceived sacrifice aspect of continuance commitment and excluded the lack of alter- natives subdimension has uncovered that it is actually positively related to job performance, organizational citizenship behavior (Taing et al., 2011) and service performance (Vandenberghe et al., 2007), in addition to being more strongly predictive of turnover than prior research had suggested (e.g. Bentein et al., 2005; Lapointe et al., 2011).
Findings with regards to the moderating role of NA provide additional insights into the complex mechanisms through which pay satisfaction contributes to retention. Specifically, fostering pay satisfaction may be less effective among employees with low levels of NA, as the indirect relationship of pay satisfaction to turnover via continuance commitment and the direct relationship between pay satisfaction and turnover were weaker among individuals with low levels of NA. As it would be hardly feasible and acceptable to devise compensation systems as a function of employees’ levels of NA, organizations that proactively pursue a retention policy may benefit from focusing on more general mechanisms that would apply to all employees. For example, organizations can encourage the development of perceptions of organizational support if they show that they proactively work at improving pay systems to better compensate employees for their efforts (Eisenberger et al., 1997), hence enhancing affective commitment to the organization, which is a well-established predictor of retention (Meyer et al., 2002). Similarly, the communication of clear and convincing explanations that underlie salary decisions can foster perceptions of procedural justice (Schaubroeck et al., 1994), which should also enhance employees’ affective commitment to their organization, thus pro- moting retention (Meyer et al., 2002).
Limitations
Although time-lagged data were used with actual turnover being measured 15 months after our independent variable and moderator, this study is not without limitations. First, our sample was composed of human resource management professionals and may not generalize to other populations of workers. For example, it would be interesting to deter- mine whether our findings would vary as a function of characteristics of organizations (e.g. size and industry), jobs (e.g. managers versus employees) and occupations (e.g. professionals versus non professionals). Second, although it has been shown that dispo- sitional NA tends to remain stable across time (Chmielewski and Watson, 2009), there is also evidence that this trait can be influenced by life experiences (Vaidya et al., 2002). As our measure of NA was taken after entry, the extent to which it could be contaminated by organizational factors is unknown. Future research might use newcomer samples and measure NA before entry. Relatedly, our single-time measure of turnover did not allow us to examine whether NA impacted the timing of turnover behavior, after assessments of pay satisfaction and commitment. Future research might account for the time elapsed between the assessment of independent and moderator variables, and voluntary turnover in order to detect potential individual differences in this regard.
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Another limitation of the current study is that it does not address the question of how pay satisfaction is derived across levels of NA. It would be worth investigating whether people high versus low in NA differ in how they calibrate their levels of pay satisfaction. For example, people high in NA may use upward pay comparison referents more fre- quently (Harris et al., 2008), thereby increasing the risk of dissatisfaction. Thus, a similar pay satisfaction score may endorse different meanings among high- versus low-NA indi- viduals depending on which referents are used. Finally, we suggested a number of under- lying mechanisms that may account for the moderating effect of NA, such as the potential operation of anxious attachment and avoidant coping mechanisms, which were not actu- ally measured. These variables may need to be empirically assessed in future studies.
Conclusion
This study extends the literature on pay satisfaction by highlighting the important role of affective and continuance commitment as mediators of the relationship of pay satisfac- tion to turnover. It also reveals that NA moderates pay satisfaction’s indirect relationship to turnover through affective and continuance commitment, as well as its direct relation- ship to turnover. These findings thus suggest the processes linking pay satisfaction to employee retention are more complex than previous research has suggested, and high- light the importance of considering individual differences in our attempt to elucidate these complex mechanisms.
Funding
This research has been funded by grants from the Canada Research Chairs Program to Christian Vandenberghe (grant number 950-219143).
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Alexandra Panaccio is an assistant professor in the Department of Management at John Molson School of Business, Concordia University, Canada. Her research focuses on leadership, personal- ity, workplace commitment, retention, performance and employee well-being. Her work has been published in peer-reviewed journals, including Journal of Organizational Behavior, Journal of Vocational Behavior, Journal of Occupational and Organizational Psychology and Human Relations, as well as in book chapters and other outlets. [Email: [email protected]]
Christian Vandenberghe is a professor of organizational behaviour at HEC Montréal, Canada. Since 2005, he has been the holder of the Canada Research Chair in management of employee commitment and performance. His research interests include organizational commitment, turnover and performance, organizational change and employee well-being. His work has been published in a variety of journals, including Journal of Applied Psychology, Journal of Organizational Behavior, Journal of Occupational and Organizational Psychology, Journal of Vocational Behavior, Group & Organization Management, Human Relations and Human Resource Management. [Email: [email protected]]
Ahmed K Ben Ayed just received his PhD in business administration at HEC Montréal, Canada. His research interests include emotions and coping strategies in the context of service encounters, personality, and commitment in the workplace. His work has been published in Journal of Occupational and Organizational Psychology and Relations Industrielles/Industrial Relations. [Email: [email protected]]
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