the effects of performance rating, leader–member exchange

The Effects of Performance Rating, Leader–Member Exchange,Perceived Utility, and Organizational Justice on PerformanceAppraisal Satisfaction: Applying a Moral Judgment Perspective

Carrie Dusterhoff • J. Barton Cunningham •

James N. MacGregor

Received: 23 April 2012 / Accepted: 20 January 2013

� Springer Science+Business Media Dordrecht 2013

Abstract The performance appraisal process is increas-

ingly seen as a key link between employee behaviour and

an organization’s strategic objectives. Unfortunately, per-

formance reviews often fail to change how people work,

and dissatisfaction with the appraisal process has been

associated with general job dissatisfaction, lower organi-

zational commitment, and increased intentions to quit.

Recent research has identified a number of factors related

to reactions to performance appraisals in general and

appraisal satisfaction in particular. Beyond the appraisal

outcome itself, researchers have found that appraisal

reactions are affected by perceptions of fairness and the

relationship between the supervisor and the employee. To

explain the relationships among these factors, the present

article proposes a moral cognition perspective. We suggest

that employees judge a performance appraisal from the

perspective of its moral justifiability, and that appraisal

reactions will be determined, at least in part, by the per-

ceived moral justifiability of the process. The proposal was

supported by results from a survey of government

employees using measures of performance ratings, leader–

member exchange, perceived utility, and organizational

justice.

Keywords Performance appraisal satisfaction � Moral

judgment � Leader–member relations � Organizational

justice

Introduction

Performance appraisals enable employers and employees to

define, communicate, and review expectations, goals, and

progress in achieving strategic objectives (Bacal 2004). The

purpose is to improve the way employees contribute to an

organization’s goals and job performance. Appraisals are

also intended to sustain, improve, and help an employee

develop and to overcome barriers to performance. If done

well, performance reviews fulfill an important organiza-

tional need to provide feedback, guide, and encourage people

to develop their skills and focus their performance toward

organizational priorities and objectives (Lawler 1994).

Unfortunately, many respected researchers and manag-

ers have questioned whether performance appraisals or

reviews are worth the effort because of difficulties expe-

rienced in conducting them. Resulting conflicts created

between supervisors and employees are sometimes long

lasting (Lawler 1994). Employees, the recipients of per-

formance feedback, are often very dissatisfied with, and

reject, the performance review process and the feedback

they receive (Elicker et al. 2006). The reviews often fail to

change how people work, nor do they improve perfor-

mance, motivate, or guide personal development (Keeping

and Levy 2000). In a survey of almost 50,000 organiza-

tional respondents, an international consulting firm found

that only 13 % of employees and managers, and 6 % of

CEOs, felt that their performance management systems

were useful (Posthuma and Campion 2008).

There is a growing consensus among researchers and

practitioners that the success with the performance appraisal

process is extremely important in encouraging employee

development and motivation (Kuvaas 2006; Fletcher 2001).

The performance appraisal process is increasingly seen as a

key part of the strategic approach to management, in

C. Dusterhoff � J. B. Cunningham (&) � J. N. MacGregor

School of Public Administration, University of

Victoria, Victoria V8P5E7, British Columbia

e-mail: [email protected]

123

J Bus Ethics

DOI 10.1007/s10551-013-1634-1

providing a tool to facilitate the linkage between an

employee’s competencies and behaviors and an organiza-

tion’s strategic objectives.

If managers expect to use the performance appraisal

process to encourage employee development and perfor-

mance, employees have to be view it positively and gen-

erally be satisfied with it. If employees are dissatisfied and

feel the process to be unfair, they are unlikely to accept and

use the results of the appraisal (Keeping and Levy 2000;

Giles and Mossholder 1990). Employees who are more

satisfied with the process are more likely to agree with their

evaluation and see it as useful in improving their perfor-

mance and development. Positive employee reactions and

agreement with the performance appraisals are linked to an

improved understanding between manager and employee,

motivation to improve performance and actual improve-

ment (Burke et al. 1978; Maier 1976). A person’s dissat-

isfaction and disagreement with the performance appraisal

process is also related to increased job dissatisfaction,

lower organizational commitment, and greater intentions to

quit (Brown et al. 2010).

Over the last few years, researchers have pointed to a

number of factors that are related to employee reactions to

performance appraisals. For example, providing more

positive feedback in the performance appraisal is seen as

one way to improve the performance review process. When

feedback is positive and people receive higher ratings than

expected, they are more likely to react positively to a

review (Blakely 1993). Beyond the appraisal outcome

itself, researchers have found that appraisal reactions are

affected by perceptions of fairness (Cawley et al. 1998).

Others have identified the importance of the relationship

between the supervisor and the employee, suggesting that a

more positive leader–member relationship is more likely to

result in higher employee satisfaction and agreement with

the process (Elicker et al. 2006).

The present article takes a moral cognition perspective

on appraisal reactions. We propose that employees may

judge a performance appraisal from the perspective of its

moral justifiability. Appraisal reactions will be determined,

at least in part, by the perceived moral justifiability of the

process.

Appraisal Reactions

Researchers have typically measured appraisal reactions in

terms of appraisal satisfaction, motivation to improve,

perceived accuracy, and perceived utility (Elicker et al.

2006). In their meta-analysis of the effects of participation

on appraisal reactions, Cawley et al. (1998) reported that

appraisal satisfaction was the most frequently measured

reaction, perhaps because it affects important outcome vari-

ables, such as motivation, commitment, and productivity.

Two forms of appraisal satisfaction have been distin-

guished; satisfaction with the appraisal session, and satis-

faction with the wider appraisal system. A second widely

used appraisal reaction reported by Crawley et al. (1998) is

perceived utility, originally measured by Greller (1978)

using a four-item scale that assessed the extent to which the

performance appraisal-clarified supervisor expectations

and helped to improve job performance.

Organizational Justice Approach to Appraisal

Reactions

An important and influential approach to understanding

performance appraisal reactions has been provided by the

organizational justice perspective (Elicker et al. 2006;

Thurston and McNall 2010). Originally couched in terms

of fairness and equity (Adams 1963; Greenberg 1986), a

number of distinct types of organizational justice have now

been proposed. The first of these, distributive justice, is

concerned with the fairness of rewards relative to the work

expended, and has been consistently found to be an

important factor in appraisal reactions. Subsequently,

procedural justice was recognized as a second form of

organizational justice. In this case, determinants of fair-

ness, beyond the outcomes themselves, are the procedures

used in conducting evaluations (Greenberg 1986). Proce-

dural justice is enhanced through adherence to ‘‘due pro-

cess’’ criteria, including lack of bias, consistency and

accuracy (Leventhal 1980). In addition, some researchers

have considered ‘‘voice’’—the degree of input an employee

has into the evaluation process to be an aspect of proce-

dural justice (Colquitt 2001;Scandura 1999), while others

have treated voice as a separate factor (Cawley et al. 1998;

Elicker et al. 2006). A third type of organizational justice

has been identified in the form of interactional justice (Bies

and Moag 1986) which, in the context of performance

appraisal, will be enhanced when an employee is treated

with consideration and respect during the appraisal process.

In a further elaboration, interactional justice has been

subdivided into two types; informational justice, focusing

on issues such as the adequacy of explanations, and

interpersonal justice, stressing issues of politeness, and

respect (Colquitt 2001; Greenberg 1993).

The recognition of different forms of organizational

justice has resulted in considerable debate and research on

the dimensionality of the construct (Colquitt 2001; Thur-

ston and McNall 2010). Some have argued that conceptual

confusion exists about the differences between interac-

tional and interpersonal justice and how these constructs

should be defined (Roch and Shanock 2006). Greenberg

(1993), for example, proposed that both interactional and

informational justice may be viewed as interpersonal

aspects of distributive and procedural justice, respectively.

C. Dusterhoff et al.

123

Others have argued that interactional justice is better

viewed as a component of procedural justice (Moorman,

1991). Even the distinction between the original two forms

of organizational justice may be questioned. Cropanzano

and Ambrose (2001), for example, have argued that dis-

tributive and procedural justice may not be as conceptually

distinct as generally believed, since what is an outcome and

what is a process may often be a matter of perspective.

Thus, the conceptual debate seems to allow for the possi-

bility of from one to four dimensions of organizational

justice. Empirical research seems to reinforce this conclu-

sion, with some results being unable to empirically dis-

tinguish between distributive and procedural justice, while

other results support the full four-factor model (Colquitt

2001). Recently, Thurston and McNall (2010) reported

evidence distinguishing the four justice factors, but cau-

tioned that the high correlations among them and the minor

gains in incremental fit challenge the practical importance

of distinguishing between them.

As of date, research on the dimensionality of organiza-

tional justice and how it relates to appraisal outcomes may

be characterized as dealing with the ‘‘horizontal’’ issues of

how to separate the dimensions of organizational justice

and arrange them with other variables, such as leader–

member exchange quality (LMX), in a causal sequence that

has appraisal reactions as the outcome. We aim in this

paper to introduce a complementary ‘‘vertical’’ dimension

to the relationships among organizational justice compo-

nents by suggesting that some may be more fundamental

than others, and that this may provide an order or prece-

dence among them. To do so, we apply a moral judgment

framework to explain satisfaction with performance

appraisal, as described below.

Conceptual Framework and Hypotheses

We propose that satisfaction with performance appraisal

may depend on the degree to which those being appraised

perceive the process to be morally justifiable. In addition,

we suggest that many of the variables previously reported

as being associated with appraisal reactions may be orga-

nized within a moral judgment framework.

In organizations, perceptions of what is morally right

are considered to be a function both of the individual’s

moral perspective and the moral culture of the organiza-

tion. Taking a contingency view, Ferrell and Gresham

(1985) proposed that ethical decision making results from

the interplay of individual, organizational, social, and

cultural factors. Similarly, Trevino (1986) proposed an

interactive person-situation model, in which the organi-

zational factors of job context, work characteristics, and

organizational culture act as situational moderators of the

individual’s moral cognitions. Following Kohlberg’s

model, Trevino proposed that individual moral cognitions

are determined by the individual’s stage of moral devel-

opment. It has been proposed that, like individuals, orga-

nizations may be characterized in terms of their level of

moral development, and Kohlberg’s approach has been

adapted to this context also (Logsdon and Yuthas 1997;

Reidenbach and Pobin 1991; Sridha and Camburn 1993).

Because Kohlberg’s ideas have influenced organizational

and management thinking on ethical decision making, we

begin with a brief outline of his theoretical position,

drawing primarily from his own summary (Kohlberg and

Hersh 1977).

Following Piaget, Kohlberg was interested in the cog-

nitive development of moral reasoning in the individual,

from infancy into adulthood. He concluded that moral

reasoning progressed through three levels, each of which in

turn consisted of two stages. Level I was referred to as the

‘‘preconventional’’ level, in which morality is determined

in terms of the physical consequences of actions. At Stage

1, right actions are those which avoid punishment. At Stage

2, they are those which satisfy one’s own needs. At Level

II, referred to as the ‘‘conventional’’ level, right actions

consist of conforming to the expectations of the immediate

social group and of loyalty towards it. Stage 3 morality is

typified by an orientation toward social approval of sig-

nificant others while at Stage 4, the ‘‘law and order ori-

entation’’ becomes more dominant, and right actions rest

on duty, responsibility and respect for rules. At Level III,

referred to as the ‘‘postconventional’’ or principled level,

moral values are defined in terms of principles that have a

more general application. At Stage 5, there is a legalistic or

social-contract orientation which recognizes the relativism

of values and the need for procedural rules for reaching

democratic consensus. At Stage 6, in contrast, moral

judgment rests on self-chosen, universal, abstract, ethical

principles.

Kohlberg believed that the sequence of moral develop-

ment is fixed, unidirectional, and involves the hierarchical

integration of each preceding stage into the next. The latter

characteristic means that cognition at a higher stage com-

prehends each lower stage of thinking, although there is a

preference to operate at the highest available stage,

according to Kohlberg. One important modification to

Kohlberg’s theory was proposed by Rest (1986), that

people may simultaneously demonstrate more than one

stage of moral development. While there have been many

criticisms of Kohlberg’s approach (Krebs and Denton

2005; Snarey 1985; Sachdeva et al. 2011), it continues to

be widely influential, informing research into moral

behaviour in many areas, including business and manage-

ment (Greenberg 2002; Monga 2007) and related applied

disciplines (Myyry et al. 2009).

A Moral Judgment Perspective

123

Application to Performance Appraisal

We propose here that one way individuals in organizations

may view the performance appraisal process is through a

moral judgment lens, and that their reactions to perfor-

mance appraisal may be influenced by the degree to which

they judge the process to meet ethical standards. We adopt

a position similar to Trevino’s (1986), that moral judg-

ments in organizations will be a function both of the

individual’s stage of moral development and situational

factors, including the moral culture of the organization. We

also follow Reidenbach and Pobin (1991) in assuming that

different components of an organization may occupy dif-

ferent stages of moral development. Together, these con-

siderations suggest that, unless the organizational culture

and situational factors are powerful enough to constrain

individuals to a particular stage, they will exhibit a variety

of stages of moral reasoning, up to the highest level

available to them.

Next, we consider how a number of the variables that

have been associated with performance appraisal satisfac-

tion may map on to different stages of moral development.

Specifically, we consider: (a) the outcome of the appraisal

in terms of a summative evaluation, (b) the immediate

social context as exemplified by LMX, (c) the utility of the

appraisal, and (d) the fairness of the process, as reflected by

Organizational Justice.

Appraisal Evaluation

To the extent that an appraisal’s overall evaluation of

performance may be interpreted in terms of rewards and

punishments, this variable has the potential to engage

moral judgments at the most basic level, comprising Stages

1 and 2. That is, a person reacting to the outcome of their

appraisal from a perspective of rewards and punishments

may tend to interpret a favourable outcome as more mor-

ally justified than an unfavourable one. If the overall

hypothesis is correct, that satisfaction with performance

appraisal depends on its perceived moral rightness, we

therefore hypothesize that:

Hypothesis 1 There is a direct relationship between the

favorability of a performance rating and appraisal

satisfaction.

LMX

Within Level II, maintaining immediate social expectations

is regarded as valuable in its own right. At Stage 3, the

basis for moral judgment is the immediate social context,

and good actions are those approved by significant others.

Loyalty and support within the immediate social context

are valued (Kohlberg and Hersh 1977). In the context of

performance appraisal, the relationship with the immediate

supervisor is likely to be highly significant. If the appraisal

is conducted in a way than maintains or promotes a loyal

and mutually supportive relationship between the individ-

ual and supervisor, then it will be more likely to be judged

as morally acceptable. Consequently, we hypothesize that:

Hypothesis 2 There is a direct relationship between

LMX and appraisal satisfaction, independently of the

effects of the performance rating itself.

Utility

At Stage 4, maintenance of the social order takes on a more

formal aspect, focussed on respect for rules, regulations

and authority. We consider that these concerns are reflected

in the utility of a performance appraisal, in terms of how

well it assists in the clarification of formal expectations,

duties and responsibilities. At this stage, a performance

appraisal that accomplishes this type of clarification will be

regarded as more morally justified than one that does not.


perceived utility and appraisal satisfaction, independently

of the effects of both LMX and the performance rating

itself.

Justice

At Stage 5, moral judgment takes on a legalistic and social-

contract orientation, emphasising due process and socially

agreed-upon individual rights. Within the context of per-

formance appraisal, the construct that most clearly reflects

this type of concern is Organizational Justice. Other things

being equal, a person operating at this stage will judge an

appraisal process that respects justice to be more morally

acceptable than one that does not.


perceived justice and appraisal satisfaction, independently

of the effects of perceived utility, LMX, and the perfor-

mance rating itself.

Organizational Context

This study was undertaken to partially provide input into a

new performance management system introduced a Cana-

dian provincial government. The system is connected to an

electronic review form linked to a corporate database. Each

employee received an overall rating on performance and

their implementation of organizational values. The form

also allowed supervisors to offer suggestions for training,

development, and career advancement.


123

Method

Survey Sample

Seventy-one respondents, out of a total sample of 166

employees in an organizational unit, responded to our inter-

net survey, representing a 43 % response rate. The majority

of the participants were female (70 %). The average age of

the participants was 42 years, and the average tenure was

13 years.

Measures

The survey included measures of performance rating,

LMX, utility, justice, and performance appraisal satisfac-

tion. Except where otherwise noted, ratings used a five-

point Likert-type scale ranging from 1 = strongly disagree

to 5 = strongly agree.

Performance Rating

Respondents were asked to report the rating they received in

the most recent performance appraisal. Ratings used a five-

point scale of: 1 = ineffective, 2 = developing, 3 = solid

performance, 4 = high achievement, 5 = exceptional.

Leader–Member Exchange

LMX was measured using a seven-item scale (Graen and

Uhl-Bien 1995). Sample items included: ‘‘I know where I

stand with my supervisor’’. (Alpha = 0.91).

Utility

Utility was measured using three items, similar to those

used by Greller (1978). These were: ‘‘As a result of the

discussion, I feel that I have a better understanding of what

my supervisor expects of me on the job’’; ‘‘I have a good

idea of what my supervisor expects in terms of job per-

formance improvements’’; ‘‘As a result of the final per-

formance review meeting, I feel the mutual understanding

between my supervisor and myself has improved.’’

(Alpha = 0.81).

Justice

We used seven items reflecting different facets of Orga-

nizational Justice, including ‘‘I feel my final review was

fair’’ (distributive justice), ‘‘I believe my supervisor has the

skills required to assess my performance fairly’’ (proce-

dural justice), and ‘‘My supervisor was helpful and con-

structive during the review process’’ (interactional justice).

(Alpha = 0.91).

Performance Appraisal Satisfaction

‘‘I felt satisfied with the performance review session.’’

‘‘Overall, I felt the performance review process (including

the planning and focusing phases) was valuable.’’ ‘‘I have

positive expectations of future performance review meet-

ings.’’ ‘‘I agreed with my performance review result.’’

(Alpha = 0.78).

We also collected information on age, gender, length of

service, and job position.

Results

The results from survey respondent (N = 71) are summa-

rized in Table 1, which presents the means, standard

deviations, and correlations for the various measures.

(Entries on the main diagonal show alpha values for multi-

item scales.) For all variables, mean ratings were above the

scale midpoints, indicating that respondents were in gen-

eral more positive than not. As can be seen from Table 1,

all of the correlations between variables were positive and

significant (p \ 0.05), as would be expected from previous

research. The correlations between the four-independent

variables and appraisal satisfaction variables ranged from

0.52, for performance rating, to 0.78, for organizational

justice. This set of significant positive correlations is gen-

erally consistent with our hypotheses. A more detailed test

is described below.

Hierarchical Regression Analysis

We conducted a hierarchical regression analysis with

appraisal satisfaction as dependent variable and age, gen-

der, length of service, job position, performance rating,

LMX, utility, and justice as independent variables. The

four demographic variables were entered in the first block,

followed by each of the remaining independent variables

separately in the order of priority specified by the moral

judgment framework: that is, performance rating, LMX,

utility, and justice. The main results are shown in Table 2.

Overall, the independent variables accounted for 71 %

of the variance in performance appraisal satisfaction. On

the initial step of the analysis, the four demographic vari-

ables were entered together, and accounted for 7 % of the

variance in appraisal satisfaction. The combined effect of

the demographic variables was not significantly greater

than zero. As a test of Hypothesis 1, performance rating

was entered at the next step, resulting in an increase in the

variance accounted for to 34 %. The increase was signifi-

cant (p \ 0.001), and supported the hypothesis that

appraisal satisfaction is a positive function of the perfor-

mance rating awarded. As a test of Hypothesis 2, LMX was


123

entered next, and increased R2 by an additional 15, to

49 %. Again, the change in R2 was significant (p \ 0.001),

supporting the hypothesis that appraisal satisfaction is a

positive function of LMX, when the effects of the perfor-

mance rating itself are controlled for. Testing Hypothesis 3,

perceived utility of the appraisal was added on the next

step, and resulted in a further increase in R2 to 65 %.

Again, the increase was significant (p \ 0.001), supporting

the hypothesis that appraisal satisfaction is a positive

function of the perceived utility of the appraisal, beyond

the effects of the rating itself and the relationship with the

supervisor. As a test of Hypothesis 4, perceived justice was

entered on the final step, and increased R2 by 6 %, to 71 %.

The significant increase (p \ 0.001) supported the

hypothesis that appraisal satisfaction is a direct function of

organizational justice, independently of the combined

effects of the rating itself, the relationship with the super-

visor, and the perceived utility of the appraisal.

Discussion

In some respects, the results of this study are unsurprising.

The individual relationships observed here between per-

formance appraisal satisfaction and the other factors have

all been previously reported, as have interrelationships

among various combinations of the factors. For example,

the relationship between LMX and justice perceptions has

now been well-established (Erdogan and Liden 2006).

LMX has been reported to influence both appraisal satis-

faction and perceived utility, mediated by voice, and justice

perceptions (Elicker et al. 2006). Sparr and Sonnentag

(2008) reported that the relationship between perceived

justice of performance appraisals and job satisfaction was

fully mediated by LMX. Similarly, Masterson et al. (2000)

reported that LMX mediated the relationship between

interactional justice and job satisfaction, while Piccolo

et al. (2008) found that LMX moderated the effects of

perceived justice on withdrawal. Erdogan (2002) proposed

a model in which pre-appraisal LMX and favorability of

performance ratings positively affect justice perceptions

which in turn positively affect post-appraisal LMX and

various performance-related outcomes.

What is less expected, perhaps, is that the individual

relationships conformed to a pattern consistent with a

hierarchical ordering of justice-relevant variables. Based

on Kohlberg’s (1969) theory of moral reasoning, and

informed by applications of the theory to organizations

(Reidenbach and Pobin 1991; Trevino 1986), we suggested

that a number of variables previously observed to correlate

with appraisal satisfaction might all be aspects of the single

construct of ‘‘moral justifiability’’. We proposed that, other

things being equal, a performance appraisal that is per-

ceived to be morally justified will be perceived as more

satisfactory than one that is not. From Kohlberg’s per-

spective on moral cognitions, the performance rating itself,

Table 1 Means, standard deviations and correlations

Means SD Appraisal sat. Perf. rating LMX Utility Justice

Appraisal satisfaction 3.11 0.76 0.78

Performance rating 3.21 0.74 0.52 na

LMX 3.58 0.80 0.62 0.50 0.91

Utility 3.31 0.80 0.69 0.27 0.72 0.81

Justice 3.56 0.74 0.78 0.49 0.78 0.78 0.91

* All correlations significant at p \ 0.01 except for performance rating with utility, p \ 0.05

Table 2 Summary of hierarchical regression analysis for variables predicting performance appraisal satisfaction

Variable Model 1 Model 2 Model 3 Model 4 Model 5

B SE B b B SE B b B SE B b B SE B b B SE B b

Age, gender,

time, position

Not sig.

Performance rating 0.58*** 0.11 0.56 0.30* 0.12 0.29 0.39*** 0.10 0.38 0.28* 0.10 0.27

LMX 0.44*** 0.10 0.47 -0.02 0.12 -0.02 -0.15 0.12 -0.16

Utility 0.58*** 0.11 0.61 0.36** 0.12 0.37

Justice 0.48*** 0.14 0.47

R2 0.07 0.34 0.49 0.65 0.71

F for R2 change 1.26 ns 25.90*** 19.52*** 29.56*** 12.36***

* p \ 0.05, ** p \ 0.01, *** p \ 0.001


123

the relationship with a supervisor, the perceived utility of

the appraisal, as well as perceptions of the justice of the

outcome and procedures of the appraisal process, may all

be viewed as relevant factors in moral judgments. Fur-

thermore, they are factors that are likely to engage moral

reasoning at different levels. Based on these consider-

ations, we derived four hypotheses about the relationships

of these factors with appraisal satisfaction, all of which

were supported by the results.

The inter-relationships among LMX, organizational

justice, performance ratings, and other outcomes are fre-

quently explained in terms of social exchange theory

(Masterson et al. 2000; Wayne et al. 2002). Both the per-

ceived fairness of rewards and of the leader’s behavior in

allocating them are related to enhanced LMX (McFarlin

and Sweeney 1992; Murphy et al. 2003). The social

exchange explanation of these and similar relationships is

that employees reciprocate the perceived fairness or lack of

fairness of leader treatment by developing higher or lower

quality exchanges (Erdogan and Liden 2006).

While the present results are consistent with social

exchange explanations, the interpretation we propose offers

the additional suggestion that social exchange processes may

be viewed as a component in a more general system of moral

cognitions. The basic idea, proposed by Kohlberg, is that

moral cognitions appear in a specific developmental order,

reflecting growth from an egocentric perspective through

more socio-centric perspectives that may both encompass

and transcend social exchange as we conventionally under-

stand it. We have suggested here that individuals apply moral

cognition to the processes and outcomes of performance

appraisal, and judge them accordingly. To the extent that the

moral culture of the organization does not completely con-

strain individuals, the resulting moral judgments may vary

both between individuals and within individuals (Rest 1986)

in terms of the level of moral reasoning that they reflect.

Consequently, the perceived moral rightness of an appraisal,

and the resulting satisfaction with it, may be influenced by

factors ranging from ego reward/punishment, reciprocity

and social support, to more impersonal and abstract con-

ceptions of fairness and justice. The present results are

consistent with this suggestion, indicating that additional

variance in appraisal satisfaction can be accounted for by

adding variables in order from basic, egocentric moral

judgments, through socio-centric perspectives, to more

abstract, general considerations.

Limitations and Future Directions

Several limitations should be taken into account in con-

sidering the contributions of this study. The method

consisted of a cross-sectional survey of employees sub-

sequent to their annual performance appraisal. Although

our analysis-specified appraisal satisfaction as dependent

variable and the other factors as independent variables,

we cannot rule out other possible causal patterns. For

example, perceptions of organizational justice and LMX

may have been consequences rather than antecedents of

appraisal satisfaction. At the same time, our present

interest was not so much in the causal ordering of vari-

ables as in their hierarchical ordering. The supposition

was that some variables play a more basic role than others

in the perception or judgement of what is morally justi-

fied. Once the effects of those more basic variables are

taken into account, the question was whether the proposed

higher-order variables have an additional effect, and

hierarchical regression analysis provided a means of

addressing this. Therefore, our interest was not so much

in whether the ‘‘independent’’ variables caused appraisal

satisfaction, as in whether the pattern of relationships

among them was consistent with their proposed hierar-

chical ordering.

A second limitation is that the measures we used had

similar scale formats. In measuring four of the constructs

we asked respondents to rate their relationship with their

supervisor, perceived usefulness of the process, feelings

of justice, and satisfaction. In a slightly different mea-

sure, we asked respondents to summarize the actual rat-

ing they received in the last performance evaluation. In

research on performance appraisal reactions, methods bias

specifically arising from affectivity has been a topic of

interest (Keeping and Levy 2000; Sparr and Sonnentag

2008). Keeping and Levy reported finding a small

methods effect associated with both positive and negative

affectivity, but concluded that the effects did not exert

any meaningful bias on appraisal reactions. However,

while Keeping and Levy’s results offer some comfort, we

acknowledge the possibility of common methods effects

in these results.

A third limitation is that our measure of organizational

justice may have combined different forms of the construct

by including items reflecting distributive, procedural, and

interactional justice. In our defence, there are precedents

for using a combined measure of this kind (Elicker et al.

2006). In addition, the scale reliability was 0.91 which may

support the Elicker et al. contention, following Lind (2001)

that people often make global justice judgments without

necessarily attending to its separate dimensions. Never-

theless, it may be useful in future research of the present

type to employ separate justice scales. This would allow

testing of whether different forms of organizational justice

may be organized at different levels in a hierarchy of moral

cognitions.


123

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