Employees' justice perceptions as a factor influencing successful outsourcing in the hospitality industry

Abstract

Purpose - This study aims to hypothesize that the more in-house staff perceive themselves as beneficiaries of the procedural justice (PJ) followed in the outsourcing, or perceive their outsourced peers as recipients of distributive (DJ) and interactional justice (IJ), the more they will show acceptance and positive evaluations of the outsourcing initiatives. Although prior research in the hospitality industry has extensively studied individual-level reactions to organizational justice, no study has been ndertaken to examine how hotel staff support and value outsourcing initiatives based on the way they perceive management's treatment of them and their peers. Design/methodology/approach - Questionnaire data from 215 in-house employees working side-by-side with outsourced employees at 14 hotels in Gran Canaria (Spain) were analyzed by using structural equation modeling. Findings - The results found that in-house employees who perceived themselves or their outsourced peers as recipients of organizational justice to a greater extent reported greater support for outsourcing by expressing higher levels of acceptance and better evaluations. The results also supported procedural justice (PJ) as playing a dominant role over distributive (DJ) and interactional justice (IJ). Research limitations/implications - The findings suggest that by encouraging justice perceptions among in-house employees, mainly those related to properly discussing the outsourcing procedures with affected employees, hotel managers can promote successful outsourcing. Given that in-house employees reacted not only to the way they were treated by hotel management but also to the way their outsourced peers were treated, the findings also indicate that all (un) fair treatment in outsourcing, regardless of the recipient, should receive explicit attention by hotel managers. Originality/value - This paper is one of the first to primarily focus on the individual level of analysis in examining and supporting organizational justice in hotel firms as a factor influencing outsourcing success.