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Journal of Managerial Psychology 16,4 268
Received December 1999 Revised November 2000 Accepted December 2000

Procedural justice in promotion decisions: using perceptions of fairness to build employee commitment
University of Tennessee-Martin, Martin, Tennessee, USA, and The University of Memphis, Memphis, Tennessee, USA
Keywords Employees, Perception, Job promotion, Employee selection, Commitment, Equal opportunities Abstract Although companies spend millions of dollars each year in their attempts to comply with fair employment laws, many firms continue to have problems with employees who perceive unfair treatment in promotion decisions. Procedural justice refers to the perceived fairness or equity of the procedures used in making decisions regarding the distribution of rewards, such as promotion. Previous research indicates a positive relationship between procedural justice and organizational commitment, but these findings relate to the effect of unfair selection decisions on organizational commitment, instead of specifically focusing on justice perceptions in promotion decisions. Because employee perceptions of unfairness may result in negative consequences for organizations, the purpose of this study was to examine the significance of procedural justice in promotion decisions in predicting organizational commitment. Regression analysis results indicate a significant main effect of the perceived fairness of the promotion-decision system on organizational commitment. Implications for research and practitioners are discussed.

Mary A. Lemons Coy A. Jones

Although companies spend millions of dollars each year in their attempts to comply with fair employment laws, many firms continue to have problems with employees who perceive unfair treatment in employment practices. One such area involves promotion decisions within the organization. Discrimination in promotion decisions has recently attracted the interest of researchers and the popular press as evidenced by the frequent use of ``the glass ceiling''. The glass ceiling refers to an invisible barrier which prevents women and minorities from advancing to higher levels in organizations (Morrison and Von Glinow, 1990). Despite recent legislation, such as the 1991 Amendment to the Civil Rights Act, which prohibits discrimination against women and minorities and imposes strict penalties for companies failing to comply, many problems continue to exist in this area. The result of employee perceptions of unfairness may be negative consequences for organizations, such as discrimination suits in a court of law (Peterson and Danehower, 1994). In addition to the cost of court fines and settlements, fairness problems are associated with other financial and psychological costs, such as intent to turnover (Dailey and Kirk, 1992), job
Journal of Managerial Psychology, Vol. 16 No. 4, 2001, pp. 268-280. # MCB University Press, 0268-3946

An earlier version of this paper was presented at the Southwest Academy of Management meeting in Houston, Texas, USA.

satisfaction (Dailey and Kirk, 1992; McFarlin and Sweeney, 1992), and pay Procedural justice satisfaction (Folger and Konovsky, 1989; McFarlin and Sweeney, 1992). in promotion Perceptions of unfairness in the organization may also lead to physiological decisions stress and real sickness in employees, thus increasing absenteeism and on-thejob accidents (Sashkin and Williams, 1990). Because it has been suggested that justice in the workplace may be a 269 stronger predictor of behavioral manifestations (e.g., intent to turnover) than core work attitudes (Dailey and Kirk, 1992), it is important that organizational researchers focus on identifying the areas where they can make a significant contribution to understanding these issues. A recent explosion of research and literature regarding organizational justice has been directed toward this purpose. Several studies have established a positive relationship between procedural justice and organizational commitment (Dailey and Kirk, 1992; Konovsky and Folger, 1987; Sweeney and McFarlin, 1993). While this research examined the effect of unfair selection decisions on organizational commitment, few researchers have specifically focused on justice perceptions in promotion decisions (Gilliland, 1993, 1994; Saal and Moore, 1993). Although promotion is considered one form of employee selection, internal promotion systems differ from external employee selection. First, because promotion involves existing employees as opposed to individuals outside the organization, promotion candidates have access to more information regarding the procedures used to make promotion decisions. Second, promotion candidates may have more information than external job applicants regarding the qualifications of the newly-promoted employee once the decision has been made (Heneman et al., 2000). Thus, one might infer that employees who are rejected during the promotion process, and who perceive the procedures used during the process to be unfair, might be more likely than rejected external applicants to demonstrate negative attitudes or behaviors. Thus, the purpose of this study is to examine the significance of procedural justice in promotion decisions in predicting organizational commitment. Theoretical foundation Organizational commitment Organizational commitment refers to the strength of employees' identification with and involvement in the organization (Porter et al., 1974). Commitment may be characterized by three factors: (1) acceptance of the goals and values of the organization; (2) the willingness to exert effort for the sake of the organization; and (3) the desire to remain a member of the organization (Cammann et al., 1983). The first two characterizations pertain to affective commitment, which states that emotional attachments and identification with organizational goals cause

Journal of Managerial Psychology 16,4 270

employees to be committed to and to remain with an organization. The third characterization, continuance commitment, suggests that employee investments (e.g. security, benefits) may make leaving too costly for some individuals (Meyer and Allen, 1984). Strong affective commitment implies that employees stay with an organization because they want to, while strong continuance commitment suggests the employees remain because they feel they have few options otherwise (Meyer and Allen, 1991). While managers and employees may view these concepts somewhat similarly (Meyer et al., 1989; Shore et al., 1995; Shore and Wayne, 1993), numerous studies support the uniqueness of these two constructs (Angle and Lawson, 1993; Hackett et al., 1994; McGee and Ford, 1987; Meyer and Allen, 1984; Meyer et al., 1990). Shore et al. (1995) found that managers perceive affective commitment as a desirable condition but view continuance commitment rather negatively. Therefore, we tested the effect of procedural justice on affective commitment rather than continuance commitment. Work experiences can be ``a major socializing force'' which impacts the psychological attachment that an employee might feel toward an organization (Steers, 1977, p. 48). For example, group attitudes toward an organization and perceptions of personal investment and personal importance to an organization influence commitment, while organizational dependability and trust are also important factors. Rewards and the realization of expectations are positively related to organizational commitment, while a significant negative relationship exists between commitment and racial and sexual discriminatory behaviors (Niebuhr, 1992). Previous studies have established a positive relationship between organizational commitment and organizational justice (Dailey and Kirk, 1992; Konovsky and Folger, 1987; Sweeney and McFarlin, 1993). While Mathieu and Zajac (1990) found little direct effect of commitment on job performance, research indicates that low organizational commitment leads to high turnover (Marsh and Mannari, 1977; Shore and Martin, 1989; Steers, 1977), and high turnover rates have a negative impact on the exiting employees and the firm psychologically as well as financially (Caldwell et al., 1990; Rosen et al., 1989). Western culture does not dictate these results. A recent study indicates that the inverse relationship between organizational commitment and turnover also exists in employees in Mainland China (Chen and Francesco, 2000). Organizational justice Organizational justice emerged as an attempt to describe the role of fairness in the workplace (for a comprehensive review see Greenberg, 1990). Researchers have examined organizational justice as two major dimensions, distributive justice and procedural justice. Distributive justice refers to the perceived fairness or equity of the manner in which rewards are distributed in organizations, while procedural justice refers to the perceived fairness or equity of the procedures used in making decisions regarding the distribution of rewards (Folger and Greenberg, 1985).

Though some researchers (Gilliland, 1993) emphasize the importance of Procedural justice distributive justice in their work, most researchers have recently concentrated in promotion on procedural justice. Procedural justice was developed by Thibaut and Walker decisions in the early 1970s as the result of a series of reactions to dispute-resolution processes. As additional research was conducted in this area (for reviews, see Lind and Tyler, 1988; Tyler, 1987), it became clear that the findings were 271 reflective of a more general tendency across a variety of settings. Procedures granting some control over the process and outcome attainment tend to be perceived by participants as fairer than procedures that deny process control (Greenberg, 1990). Process control (or ``voice'') refers to the opportunity participants have in communicating their views and opinions in a decisionmaking process. The greater the process control allowed to participants, the more likely they regard the decision-making procedures as fair (Leung and Li, 1990). In addition, when decision-makers communicate a justification for the decision reached and the decision-maker is considered sincere, participants view the process as fair (Bies, 1987; Gopinath and Becker, 2000; Richard and Kirby, 1997). In the case of promotions, procedures used to make decisions might include interviews, performance reviews, psychological testing, or assessment centers. Hewlett-Packard allows employees to choose their own supervisors, a practice which strengthens their interest in seeing their manager succeed. This can be especially important when the employee chosen for the promotion obtains legitimate power over former co-workers through the new position. The former co-workers are more cooperative when they participate in the promotion decision (Deutschman, 1994). The role of procedural justice in promotion decisions According to Arvey and Sackett (1993, p. 186), ``applicants who were successful in obtaining a job through a system they believe is unfair may be troubled by feelings of inequity; a link to higher rates of eventual turnover might be hypothesized''. For example, a Caucasian male promoted instead of a more qualified African-American employee might have feelings of inequity that could lead him to eventually leave his company for a fairer organization. In addition, employees who have been turned down for a promotion may express their dissatisfaction by focusing on how unfair the decision was because the person promoted had less experience or tenure (Sashkin and Williams, 1990). Examining promotion decisions in person-based reward systems (systems based on a particularly powerful form of personal power rather than performance), Pearce et al. (1994) found that employees in person-based organizations report their personnel systems as being less fair than employees working in organizations that base their promotion decisions on performance. However, when employees have a voice in the decision-making process, they are generally more satisfied with the outcome, even when it is not the one they favored (Folger and Greenberg, 1985). In other words, when high procedural

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justice in promotion decisions exists, employees are more likely to experience satisfaction with organizational outcomes. Although Saal and Moore (1993) examined the perceptions of promotion fairness and promotion candidates' qualifications, they did not investigate the possibility of a linkage between the perceived procedural justice in promotion decisions and organizational outcomes. It is proposed that as employees perceive unfair promotion procedures, they may experience declines in organizational commitment. The following hypothesis was developed to test this relationship. H1: Employees perceiving high procedural justice in promotion decisions experience higher levels of organizational commitment than employees perceiving low procedural justice in promotion decisions. Method Subjects To test the hypothesis, data are collected from 290 volunteer students (170 female, 120 male). The sampling frame was drawn from working adults enrolled in MBA and undergraduate classes at several large universities located in two geographic regions. The subjects were all employed full-time at a variety of small, medium, and large organizations while attending school. To retain response control, qualified students were allowed class time to complete the questionnaire (approximately 25 minutes). Zahra and LaTour (1987) suggest that students who are working full-time hold views and opinions much more congruent to the real world population than traditional, non-employed students or students working part-time. Researchers have found that the use of full-time employed students is appropriate when studying general behavioral concepts (Krughanski, 1975) because they often exhibit various attitudes of the society in general (Gordon et al., 1986). Since organizations are often reluctant to allow researchers to collect data regarding fairness issues, LaTour et al. (1990, p. 69) conclude that student samples ``are often the only data source available''. Of the respondents, 75 percent were Caucasian. The mean age was 34, and approximately 50 percent of the respondents held management positions. Measures Procedural justice. While organizational justice has been extensively examined and scales have been developed for both procedural and distributive justice, little research has focused on justice in promotion decisions. Thus, no scales exist to measure these specific constructs. This study used existing research regarding organizational justice and promotion decisions to develop a modified version of Price and Mueller's Distributive Justice Index. Similar studies have used modified versions of Price and Mueller's (1986) scale to successfully measure both procedural and distributive justice in various areas (McFarlin and Sweeney, 1992; Sweeney and McFarlin, 1993).

The four-item scale asks workers to indicate the fairness of the procedures Procedural justice their companies use to determine which employees are promoted considering the in promotion qualifications of the candidates, including seniority, experience, education, and decisions training (e.g. ``Considering employee's educational qualifications, how fair are the procedures used to determine which employees are promoted?''). Procedures were broadly defined, with interviews and testing listed as examples. As in the Price 273 and Mueller (1986) scale, the format for response consisted of five categories (1 = very unfair, 5 = very fair), with high scores indicating strong perceptions of procedural justice in promotion decisions. An exploratory factor analysis using principle components extraction method with varimax rotation resulted in all four items loading onto a single factor, indicating the measurement of one dimension. Reliability for the scale was  = 0.86. Organizational commitment. Organizational commitment was assessed using Mowday and Steers' (1979) Organizational Commitment Questionnaire (OCQ). This instrument consists of 15 items, nine which are positively scored and six which are negatively scored. The reverse scoring reduces the possibility of response set bias. The items ask workers to express their agreement or disagreement with various statements (e.g. ``I am willing to put in a great deal of effort beyond that normally expected in order to help this organization be successful''), using seven-point scales (1 = strongly disagree, 7 = strongly agree). Reliability for the scale in this study was  = 0.88, which is comparable to previous studies. Control variables. As workers increase in age, tenure, and job prestige, they experience higher levels of organizational commitment (Marsh and Mannari, 1977). Specifically, older employees with higher levels of tenure may experience higher levels of commitment than younger workers with less time invested in the company (Brief and Aldag, 1980; Meyer and Allen, 1984). In addition, the effect of job prestige on commitment leads to the inference that employees holding management positions should have higher levels of commitment than employees in hourly positions. Thus, the calculation of the equation included age, employee position, and organizational tenure as control variables. The difference between female and male perceptions of fairness has been examined by several researchers with differing results. While several studies found that differences exist in fairness perceptions between men and women (Brockner and Adsit, 1986; Lemons and Chowdhury, 2000; Tata, 2000), another found no difference between the two groups (Witt and Nye, 1992). Considering the recent interest in the glass ceiling for women and its potential effect on perceptions of fairness (Lemons and Danehower, 1996), gender was also included as a control variable. Analysis and results Table I shows the descriptive statistics, reliabilities, and correlations for the study's variables. Noteworthy relationships are those between (1) commitment and procedural justice in promotion decisions (r = 0.40, p < 0.01), (2) age of the employee and tenure (r = 0.51, p < 0.01), and (3) procedural justice and tenure

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(r = ±0.24, p < 0.01). While the first two relationships were expected, the third relationship presents intriguing information suggesting that as tenure increased for this study group, procedural justice in promotion decisions decreased. One explanation may be that new employees progress at a faster rate than respondents with more years of service; thus, they may be more inclined to perceive promotion decisions as fair. Additionally, employees with more tenure may have witnessed more instances of promotion practices which were perceived as unfair. It is also interesting to note that tenure, age, and position were not significantly correlated with commitment as previous literature suggests. However, position is highly correlated with age (r = 0.20, p < 0.01) and tenure (r = 0.13, p < 0.05). Thus, older employees have more tenure and can be found in higher positions within organizations, indicating face validity. Tables II and III present a more dynamic picture of the relationship among the study's variables. Using hierarchical multiple regression, the sequential contributions to variance explanation in the dependent variable (organizational commitment) by the independent variable (procedural justice) can be measured. The homogeneity and linearity assumptions were met by examining a scatterplot of the residuals and through the use of a cursory test of linearity. The linear term was significant (p = 0.000) whereas the deviation from linearity was not significant (p = 0.31), meaning that a linear relationship exists between procedural justice in promotion decisions and organizational commitment.
Variable 1. 2. 3. 4. 5. 6. PROJUST COMMIT AGE TENURE POSIT SEX Mean 3.41 3.53 3.42 2.99 2.69 1.40 SD 0.916 0.728 1.16 1.31 0.85 0.49 1 2 3 4 5 6

Table I. Means, standard deviations, scaled variable reliabilities, and intercorrelations among study variables

1.0000 (0.86) 0.4043** 1.0000 (0.88) ±0.1075 0.1121 1.0000 ±0.2414** 0.0163 0.5157** 1.0000 0.0320 0.1155 0.2008** 0.1385* 1.0000 0.0894 -0.0169 ±0.1456* ±0.0744 0.0547

1.0000

Notes: Values in parentheses are Cronbach's alphas n = 290; * p < 0.05; ** p < 0.01

Predictor variables Step 1 Gender Age Tenure Position Step 2 Procedural justice Note: n = 290; * p < 0.001

R Sq

R Sq Chg

F

df

Table II. Results of hierarchical regression analyses for organizational commitment

0.02 0.19 0.17

1.80 57.94*

4,285 5,284

Using hierarchical multiple regression, all of the control variables (age, gender, Procedural justice tenure, and employee position) were entered on the first step and the in promotion independent variable (procedural justice in promotion decisions) was entered decisions on the second step. At step 1, the R square was 0.02 and the control variables were not significant. However, in step 2 procedural justice in promotion decisions was found to be a significant predictor of organizational commitment 275 (F = 12.93, p < 0.001). The R square change was 0.17. Thus, after controlling for age, tenure, gender, and employee position, procedural justice in promotion decisions accounted for 17 percent of the total explained variance (19 percent ) in the equation and H1 was supported. Discussion The results in this study support the hypothesis that procedural justice in promotion decisions affects organizational commitment in employees. The study underscores recent admonitions for organizational researchers to duplicate laboratory studies to determine the generalizability of previous findings (Cropanzano and Folger, 1989). Since this research used a sample of employees from a combination of small, medium, and large firms, it is possible to infer that the perceived fairness of the system used in promotion decisionmaking may be an important determinant of employee commitment. Therefore, the results of this study hold implications for both practitioners and researchers. First, practicing managers interested in predicting or influencing employee levels of organizational commitment may benefit by attempting to increase levels of procedural justice in promotion decisions. One way they may increase perceptions of justice is to allow employees to become involved in developing the systems used in making promotion decisions. This would increase their ``voice'' and thus their perceptions of fairness. It is also suggested that practicing managers make every effort to communicate and involve employees in promotion decisions. For example, employee participation in peer evaluation may increase feelings of ``voice'' in decisions. Since performance appraisals are one input into promotion decisions, allowing workers to evaluate each other provides employees with an indirect way of participating in the actual promotion decision. Additionally, employees might be encouraged to join the staff of assessment centers so they can become more involved in making
Predictor variables Gender Age Tenure Position Procedural justice in promotion decisions Note: n = 290; * p < 0.10; ** p < 0.01 Organizational  ±0.061 0.063 0.013 0.078 0.338 Commitment t ±0.75 1.33 0.38 1.92* 7.61**

Table III. Standardized regression coefficients ( s) for all variables in final equation

Journal of Managerial Psychology 16,4 276

promotion decisions, thus increasing their ``voice'' and perception of fairness (Deutschman, 1994). Since justification and sincerity increase the likelihood of fairness perceptions, decision-makers should give good explanations for their choices in a way that induces employees to believe the system used was fair. Second, by investigating justice in promotion decisions, this study addresses issues which may be even more important than previous findings regarding justice in selection decisions for reducing the number of employee discrimination suits filed against a company. Since the passage of the 1991 Amendment to the Civil Rights Act prohibiting discrimination against women and minorities, employers are seeing more awareness among employees regarding issues of fairness in the workplace. In addition, the recent debate regarding the fairness of affirmative action programs has drawn employee attention to discrimination issues (Heilman, 1994; Kravitz and Platania, 1993). Since internal candidates have access to more information regarding promotion procedures, they may be more likely than external candidates to file grievances regarding perceived unfair practices. Similarly, because promotion candidates are available for data collection whereas external candidates are usually not available once the selection process has been completed, promotion candidates offer a source of information which may be more useful than past research studies in laboratories. The results of this study demonstrate a need for future research in several areas. First, since the interaction of procedural and distributive justice has been found to have a more significant effect on organizational outcomes than procedural justice alone (Cropanzano and Folger, 1989), implications for future research include examining the interaction effect of distributive and procedural justice in promotion decisions on organizational commitment. Although fair procedures have been found to produce high organizational commitment regardless of the outcome (McFarlin and Sweeney, 1992), the combination of unfair procedures and unfair outcomes in promotion decisions might produce the lowest organizational commitment. Second, other organizational variables besides organizational commitment should be investigated, such as absenteeism and intent to turnover, to determine whether they might also be predicted using the perceived fairness of promotion decisions (Aquino et al., 1997). Baruch (1998) believes that employee attitudes are making organizational commitment less important than in previous years. Because many organizations seem more concerned with profits than people, he feels that commitment is a construct whose time is past. Additionally, Becker et al. (1996, p. 464) found that ``commitment to supervisors was positively related to performance and was more strongly associated with performance than was commitment to organizations''. On the other hand, Benkhoff (1997, p. 701) conducted empirical research in Germany and found that ``employee commitment is significantly related to the financial success of bank branches''. Thus, research is needed to determine the value of examining this construct in the future.

Several potential limitations are inherent in this study. One limitation Procedural justice involves the use of a student sample. However, care was taken to ensure as in promotion much generalizability as possible to working adults by only sampling nondecisions traditional students working outside the home. The racial composition of the sample may be a limitation, also. The sample was 75 percent Caucasian; therefore, it may be unrealistic to apply the findings to minority groups. Future 277 research is needed using a more diverse sample. The cross-sectional nature of the study renders it difficult to draw causal conclusions about the relationships among the variables. Although correlations exist, cross-sectional research does not explain why they exist or what other external factors might have caused the observed correlations. Pettigrew (1985) suggests that research focus on change processes within the broader social, economic, and political context surrounding each organization, and that researchers should gather ``time series data'' over periods of time significantly longer than the immediate focus. With longitudinal research, explanations may emerge through examinations of patterns in the process of change. Organizational justice will continue to be an issue of great concern for a large number of companies wishing to promote equality in an era of spiraling discrimination suits and workplace diversity. Thus, it is crucial for managers and researchers to better understand this construct. In addition, the current emphasis on the glass ceiling and affirmative action demonstrates the importance of research with regard to procedural justice in promotion decisions. Because this study found significant results even after controlling for gender, age, tenure, and position, one may infer that the perception of fairness or unfairness in promotion-decision systems is a strong predictor of employee attitudes for most employees regardless of these demographic variables. Thus, to avoid costly discrimination suits, as well as turnover and other negative organizational outcomes, employers need to address the problem of perceptions of unfairness regarding promotion procedures. With the importance of organizational commitment well established in previous literature, this study presents an additional relationship which deserves more attention and should serve as an impetus for future research in this area.
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