Effect of Fairness on Employee Outcome: An LMX Perspective on Indian Banks

Shalini Sahni and Chandranshu Sinha

Global Business Review, 2020, vol. 21, issue 4, 1113-1126

Abstract: The current study is proposed to test the mediated effect of social exchange mechanism of leader–member exchange (LMX) between organizational justice and employee outcomes in the Indian banking industry. Stratified random sampling was used to collect the data from 346 employees of two Indian public and two Indian private banks listed in the CNX index. Data were analysed using confirmatory factor analysis and path analysis of the proposed model. Findings reveal that LMX partially mediated between all justice dimensions and employee outcomes. However, procedural justice is the strongest predictor of employee outcomes in public sector banks and weakest in private sector banks. This study has implications for both academicians and practitioners and adds to the previous literature by testing the projected model in the Indian settings, thus providing some empirical validity to justice–LMX–employee outcomes relationships.

Keywords: Organizational justice; employee outcomes; Indian banks; leader–member exchange; social exchange processes (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:sae:globus:v:21:y:2020:i:4:p:1113-1126

DOI: 10.1177/0972150918779276

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