Fairness at the Organizational Level: Examining the Effect of Organizational Justice Climate on Collective Turnover Rates and Organizational Performance
| DOI | 10.1177/0091026017702610 |
| Author | Kuk-Kyoung Moon |
| Date | 01 June 2017 |
| Published date | 01 June 2017 |
| Subject Matter | Articles |
research-article2017
Article
Public Personnel Management
2017, Vol. 46(2) 118 –143
Fairness at the Organizational
© The Author(s) 2017
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https://doi.org/10.1177/0091026017702610
DOI: 10.1177/0091026017702610
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of Organizational Justice
Climate on Collective
Turnover Rates and
Organizational Performance
Kuk-Kyoung Moon1
Abstract
In the continuing quest to understand public employees’ reactions to fair (or unfair)
treatment in the workplace, perceived organizational justice has been conceptualized
primarily as an individual-level phenomenon. Although individuals create collective
perceptions of the fair treatment of their work unit as a whole, little attention has
been paid to consequences of justice climate at the organizational level. Using panel
data from the U.S. federal government, this study seeks to fill this gap by examining
the effect of four dimensions of organizational justice climate—distributive,
procedural, informational, and interpersonal—on collective turnover rates and
organizational performance. The findings show the negative association of distributive
and interpersonal justice climates with turnover rates and the positive association
of distributive, procedural, and interpersonal justice climates with organizational
performance. Moreover, further analysis confirms that each dimension of justice
climate has relative influence on both outcomes. Implications and contributions of
these results for public administration theory and practice are discussed.
Keywords
organizational justice climate, social exchange theory, two-factor justice model,
collective turnover rates, organizational performance
1Korea Institute of Public Administration, Seoul, Korea
Corresponding Author:
Kuk-Kyoung Moon, Korea Institute of Public Administration, 235 Jinheung-ro, Bulgwang 1(il)-dong,
Eunpyeong-gu, Seoul, Korea.
Email: vivamkk@gmail.com
Moon
119
In the past decade, organizational justice has become a central topic in public admin-
istration (Cho & Sai, 2012; Hassan, 2013a; Rubin & Chiqués, 2015; Rubin & Weinberg,
2016). Much attention has been given to justice perceptions because of the important
work-related outcomes that have been linked to fair treatment of employees by the
organization and its decision-makers. Indeed, empirical research demonstrates that
when public employees are fairly treated in terms of reward distribution, the proce-
dures by which rewards are distributed, and interpersonal treatment by managers or
supervisors (hereafter managers), they exhibit positive work attitudes, including
increased job satisfaction, trust in management, intention to remain, job involvement,
and intrinsic work motivation (Cho & Sai, 2012; Choi, 2011; Hassan, 2013a; Kim &
Rubianty, 2011; Ko & Hur, 2014; Meng & Wu, 2015; Noblet & Rodwell, 2009; Rubin,
2009). Furthermore, fair treatment encourages employees to engage in positive work
behaviors, such as cooperation and organizational citizenship behavior (Chen & Jin,
2014; Cho & Sai, 2012).
More recently, however, many scholars have turned their attention from an indi-
vidual approach toward organizational justice to a shared perception of justice at the
organizational level (Li & Cropanzano, 2009; Whitman, Caleo, Carpenter, Horner, &
Bernerth, 2012). Although justice research conducted at the individual level has con-
tributed significantly to theoretical development by explaining the relationships
between perceived justice and various types of work-related outcomes, an individual-
istic approach may fail to take into account the social context in which collective
perceptions of fairness result in higher-level outcomes (Mossholder, Bennett, Kemery,
& Wesolowski, 1998; Naumann & Bennett, 2000). Individuals do not exist in a vac-
uum; instead, their judgments about justice are constantly affected by others within the
work unit (Li & Cropanzano, 2009; Naumann & Bennett, 2000). In this vein, Lind,
Kray, and Thompson (1998) noted that “most of the potential information about the
fairness of any given authority or institution lies in collective, not personal, experi-
ences” (p. 19). This implies that individuals interact with one another, exchange their
interpretations of work unit treatment, and formulate a collective sense of fairness,
which is known as organizational justice climate (Li & Cropanzano, 2009).
Despite the growing attention to employees’ shared perceptions of fair treatment,
much of the empirical research on justice in public administration has been conducted
at the individual level, with little attention paid to organizational-level investigations
(see Rubin & Kellough, 2012, for an exception). This imbalance is potentially prob-
lematic because justice climate effects are more powerful when all or most of an orga-
nization’s members have been treated fairly (Naumann & Bennett, 2000; Yang,
Mossholder, & Peng, 2007). Furthermore, although justice perception is a multifac-
eted concept that comprises distributive, procedural, informational, and interpersonal
justice (Colquitt, 2001), it is surprising that little scholarly effort has been invested in
exploring how the four dimensions of justice affect organizational outcomes differ-
ently. This gap in the literature suggests that an examination of the relative influence
of each justice dimension may offer a more reliable portrait of the processes by which
fair treatment of employees in public sector organizations promotes desired organiza-
tional outcomes (Roberson & Colquitt, 2005).
120
Public Personnel Management 46(2)
The current study aims to advance the previous research in three distinct ways.
First, responding to the need for more empirical studies on the relationships between
justice climate and organizational outcomes, this study examines the effects of the
four dimensions of justice climate on collective turnover rates and organizational
performance at the U.S. federal agency level. In particular, based on the norm of
reciprocity within social exchange theory, shared perceptions of organizational jus-
tice are negatively related to turnover rates, but positively related to goal achieve-
ment because employees are more likely to remain in their current organization and
show better performance when they are being treated fairly (Cohen-Charash &
Spector, 2001; Colquitt et al., 2013). Second, this study explores relative effects of
the four dimensions of justice climate on both outcomes. Building on the two-factor
justice model, distributive and interpersonal justice climates that are classified as
outcome-focused are more influential on person-referenced outcomes, such as
employee turnover, whereas procedural and informational justice climates that are
categorized as process-focused are more influential on organization-referenced
outcomes, such as organizational performance (Cho & Sai, 2012; Sweeney &
McFarlin, 1993). Finally, although employees adjust their fairness perceptions as
they acquire additional information regarding justice-related events (Ambrose &
Cropanzano, 2003; Hausknecht, Sturman, & Roberson, 2011), most previous
research in public administration has relied on a cross-sectional research design
when examining the relationship between perceived justice and work-related out-
comes. Consequently, scholars have provided a good snapshot of justice in any one
instance but have failed to draw stronger conclusions about causal processes
(Ambrose & Cropanzano, 2003). In this regard, this study takes a longitudinal
approach to investigating the underlying effects of justice climate over time using
panel data from the U.S. federal government.
The article begins by reviewing the literature on the four dimensions of organiza-
tional justice at the individual level and providing a brief overview of how justice
research in public administration has evolved over time. Then, I provide theoretical
arguments pertaining to organizational justice climate and develop hypotheses about
its effect on employee turnover rates and organizational performance. Subsequently,
the article presents the statistical data analyses and results. The last section provides
the implications of the findings for theory and practice and discusses limitations with
suggestions for future research.
Theories and Hypothesis Development
Four Dimensions of Organizational Justice at the Individual Level
Organizational justice is concerned with the extent to which employees perceive the
treatment received from an organization or managers to be fair (Colquitt, Greenberg,
& Zapata-Phelan, 2005). Four distinct dimensions of justice perceptions—distribu-
tive, procedural, informational, and interpersonal—have traditionally been conceptu-
alized as the individual-level phenomena in the literature (Colquitt, 2001).
Moon
121
First, distributive justice refers to an individual’s perceptions of the extent to which
the outcomes obtained are fair (Byrne & Cropanzano, 2001; Folger & Cropanzano,
1998). Early organizational justice research was based on Adams’s (1965) equity the-
ory, in which an individual formulates justice perception by performing a comparative
calculation of one’s contributions and rewards from a decision-making system
(Crawshaw, Cropanzano, Bell, & Nadisic, 2013). The theory predicts that employees
who feel that outcome distributions are unfair will...
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