Why do Employees' Perceptions of their Change History Matter? The Role of Change Appraisals

Abstract

In this paper, we identify an employee’s change history in an organization as a key antecedent of their appraisals about organizational change (i.e., threat, harm, and challenge). We argue that these change appraisals are associated with psychological contract violation, which in turn is associated with intentions to turnover, and ultimately, with voluntary employee turnover. In 2009, we collected data over three measurement periods from 252 full-time, permanent employees from a manufacturing organization in the Philippines that was just about to undergo an organizational-wide restructuring. At Time 1 (T1, the change announcement), employees completed a survey assessing their change history in the organization and change appraisals. At Time 2 (T2, six months after the announcement), employees completed a survey assessing psychological contract violation and turnover intentions. Two years later (Time 3, T3), we collected data on voluntary employee turnover. Results suggest that a poor change history in an organization was negatively associated with challenge appraisals and was positively associated with threat and harm appraisals. Challenge and harm appraisals were significantly associated with psychological contract violation. These appraisals, in turn, were associated with turnover intentions, and ultimately, with voluntary employee turnover. In addition, T1 threat appraisals were directly positively associated with T3 voluntary turnover. Theoretical and practical implications are discussed