June 2010 Dissertation

1. DISSERTATIONDISSERTATION
DEFENSEDEFENSE
Edward R. Haberek, Jr.Edward R. Haberek, Jr.
June, 2010June, 2010

2. AcknowledgmentsAcknowledgments
• I would like to express my most sincere appreciation to:
– Dr. Emmanuel T. Santos
– Dr. Nerza A. Rebustes
– Dr. Dante Sy
– Dr. Pedrito Salvador
– My Family, especially:
• My Parents, Edward Sr. and Patricia
• My Wife, Maureen
• My Daughters, Nicole and Olivia

3. AcknowledgmentsAcknowledgments (cont’d.)(cont’d.)
• I/AME Administration, including:
– Primavera S. Donohue, Vice President
– Faculty and Staff
• My Friends, including:
– Dr. Donna Maria Blancero, TUI Advisor
– M’Liss Rinaldi
• I/AME Colleagues, including:
– Sonny Cualteros
– Chris Perez
– Atty. Elba Cruz
– Jiggs Gegajo
– Arnold Guarin
– Alex Zapata
– Ricky Tolentino
• National Society of Hispanic MBAs (NSHMBA)

4. DISSERTATION TITLE:
AN EVALUATION OF THE FACTORS
AFFECTING CONTRACTS, JUSTICE, AND
SUPPORT IN THE WORKPLACE
RESEARCHER : Mr. Edward R. Haberek, Jr.
SCHOOL : International Academy of
Management and Economics (I/AME)
DEGREE : Doctor of Philosophy (Management)
ADVISOR : Dr. Nerza A. Rebustes
YEAR : 2010

5. The Problem and itsThe Problem and its
BackgroundBackground

6. Scope of the StudyScope of the Study
• Cross-sectional study using web-based
survey
• Respondents included 1,236 Hispanic
business professionals
• Study designed to examine the
relationship of Trust, Fairness, Justice,
and Support in the workplace
• Outcomes and recommendations to
provide insight to a healthy work
environment.

7. Scope of the StudyScope of the Study (cont’d.)(cont’d.)
• The study examines the effects of
employers’ decisions on employees,
including:
– Perceived Organizational Support
– Psychological Contract Fairness
– Leader-Member Exchange

8. Background of the StudyBackground of the Study
• Trust, Fairness, and Justice - important
fundamentals for satisfied, content, and
productive employees.
• An employer’s decisions affect individual
employees on a more or less daily basis.
• Outcomes of decisions often form the
motivation to work for the organization.

9. Purpose of the StudyPurpose of the Study
• The study was conducted to evaluate the factors
of Trust, Fairness, and Justice in today’s
workplace environment.
• The study was to identify correlations of
Perceived Organizational Support, Psychological
Contract Fairness, and Leader-Member
Exchange in Trust.
• The study provides outcomes and
recommendations to help provide insight to a
conducive work environment with trusting
relationships.

10. Significance of the StudySignificance of the Study
• This study concentrates on various issues
relating to Hispanic business
professionals.
• This study is distinctive because it serves
as a component of a larger research
project (Blancero and DelCampo, 2003).
• Research will add to Psychological
Contract Fairness literature with
constructs of the assessments not
previously studied.

11. Theoretical FrameworkTheoretical Framework
• Information gained from this study will
yield substantial benefits for scholars,
practitioners, future Hispanic generations
and corporate America. (Blancero and Blancero,
2001)
• Lessons learned from this research may
be applied by management in addressing
the unique issues Hispanic employees
face, including: identity, fairness, support,
and leadership.

12. Conceptual FrameworkConceptual Framework
• Organizational management literature
severely neglects the role that ethnicity
and culture have played in influencing
work experiences for Hispanic personnel.
(Romero, 2004)
• This research focuses on various issues
as they relate to Hispanic business
professionals and various forms of Trust,
Justice, Organizational Support,
Psychological Contract Fairness, and
Leader-Member Exchange.

13. Statement of the ProblemStatement of the Problem
• The study was conducted to evaluate factors
affecting contracts, Justice and Support in
today’s workplace environment.
• The study identifies correlations of Perceived
Organizational Support, Psychological Contract
Fairness, Justice, and Leader-Member
Exchange in Trust and examines the relation of
each factor in the workplace.

14. Research QuestionsResearch Questions
• Does Psychological Contract Fairness have a direct
effect on Trust when controlling for age, gender, total
work experience, tenure with supervisor, and tenure
with the organization?
• Does Leader-Member Exchange Theory have a direct
effect on Trust when controlling for age, gender, total
work experience, tenure with supervisor, and tenure
with the organization?
• Does Organizational Support have a direct effect on
Trust when controlling for age, gender, total work
experience, tenure with supervisor, and tenure with
organization?
• Is the relationship between Organizational Support and
Trust mediated by Leader-Member Exchange Theory
when controlling for age, gender, total work
experience, tenure with supervisor, and tenure with the
organization?

15. Research QuestionsResearch Questions (cont’d.)(cont’d.)
• Is the relationship between Organizational Support and
Trust mediated by Psychological Contract Fairness when
controlling for age, gender, total work experience, tenure
with supervisor, and tenure with the organization?
• Is the relationship between Organizational Support and
Trust moderated by Perceived Discrimination when
controlling for age, gender, total work experience, tenure
with supervisor, and tenure with the organization?
• Is the relationship between Organizational Support and
Trust moderated by Procedural Justice when controlling
for age, gender, total work experience, tenure with
supervisor, and tenure with the organization?

16. Study ObjectivesStudy Objectives
• To analyze Psychological Contracts Fairness and
Justice and their application to the workplace.
• To investigate correlations between Perceived
Organizational Support and Psychological
Contracts Fairness as important influences on
Trust and feelings of Fairness and Justice in the
workplace.
• To examine the effects of the constructs of
Perceived Discrimination and Leader-Member
Exchange Theory.

18. Review of RelatedReview of Related
LiteratureLiterature

19. Review of Related LiteratureReview of Related Literature
• Trust
• Fairness
• Justice
• Perceived Organizational Support
• Psychological Contract
• Leader-Member Exchange Theory
• Perceived Discrimination

20. Elements of TrustElements of Trust
• Mayer, Davis, and Schoorman (1995) defined Trust as
“the willingness of a party, the Trustor, to allow him or
herself to be vulnerable to the actions of another party,
the Trustee”.
• Trust involves associated Risk. This is because the
Trustor is willing to be vulnerable to the
Trustee.
• Trust relies upon the Trustee to perform certain desired
behaviors. For this reason, the Trustor must
believe both that the Trustee wants to engage in
the desired behavior and has the ability and
capacity to do so.
• The actions that the Trustor anticipates that the Trustee
will perform may be important to the Trustor for several
reasons.
• Included in the definition of Trust is the Trustor's
perception of the motivation that brings about the
behavior of the Trustee.

21. Elements of TrustElements of Trust (cont’d.)(cont’d.)
• Lewicki & Bunker (1996) applied model to
intra-organizational relations.
• Typical Management Mechanisms involved are:
- Calculus-Based Trust : Contracts and
Controls
- Knowledge-Based Trust: Communication
and Courtship
- Identification-Based Trust: Proxy
representation along with social bonding

22. Types of TrustTypes of Trust
• Familiarization is the process that leads to
the formation of Trust.
• Traditional Trust – Past experience and Self-
control
• Institutional Trust- Outside controls
• Active Trust- Based on “Good Faith” and
Individuals

23. FairnessFairness
• Cropanzano and Schminke (2001) pointed
out that individuals are the subjects of
decisions almost every day in an
organization.
• Decisions often form the foundation of the
motivation for individuals to work for this
organization.
• Individuals often judge the “fairness” of the
decisions affecting them (Colquitt, 2001).

24. Types of JusticeTypes of Justice
• Distributive Justice – Justice of Decision
Outcomes
• Procedural Justice- Processes that result
in decision outcomes
• Organizational Justice- Justice on the
effectiveness of the way in which
organizations function

25. Organizational Justice
• Conceptualizations in research
Distributive Justice- Fairness of the ends
achieved
Procedural Justice – Fairness of policies
and procedures used to make the decisions
Interactional Justice- The basis of
expectations for interpersonal treatment
(concept first introduced by Bies and Moag; 1986)

26. Perceived OrganizationalPerceived Organizational
SupportSupport
• Defined: Whether organizations support
and care of well-being. (Rhoades & Eisenberger; 2002)
Three Categories:
- Supervisor Support
- Fairness
- Organizational Rewards
Results in:
- Positive Mood /Job satisfaction (Employee)
- Good Performance/Commitment (Organization)

27. Psychological ContractPsychological Contract
TheoryTheory
• Basis: The difference between that which is
promised and that which is delivered from the
perspective of the employee, and hence his or
her reciprocation. (Coyle-Shapiro & Conway, 2005)
• Breach of the Psychological Contract may result
in erosion of the relationship. (Robinson, 1996)
• According to Psychological Contract theory,
POS will affect the fulfillment of Psychological
Contracts and a reciprocal relationship will exist.
(Morrison & Robinson, 1997)
• Psychological Contracts are become
increasingly important in today's employment
relationships.

28. Psychological ContractPsychological Contract
FairnessFairness
• Defined: Individual's belief to the conditions
and terms of an Exchange Relationship that
exists with another party (Rousseau, 1989)
• Concerned with the mutual obligations that are perceived
as well as the degree to which they are fulfilled in the
Exchange Relationship between the employee and the
employer.
• Includes both the employer's and the employee's
perspectives

29. Leader-Member ExchangeLeader-Member Exchange
TheoryTheory
• Premise: role development results in differentiated role
exchanges between the leader and subordinates within
an organization (Case, 1998)
- “In group”: members benefit from an increase leadership
support for their actions and increased consideration and
confidence by the leader.
- “Out group”: low levels of mutual influence exist in leader
relationships
• Competency, compatibility, and dependability of the
group members are significant determinants of whether
the member will become a member of the "in" group or
the "out" group (Graen & Cashman, 1975)

30. Effects of PerceivedEffects of Perceived
DiscriminationDiscrimination
• “Racial discrimination” refers to a range of
practices encompassing discrimination based on
ethnic group classification. (Bhui, 2005)
• Racial discrimination found to be an important
risk factor among the US workforce, leading to
problems such as mental illness. (Darity, 2003)
• Mental disorders resulting from racial
discrimination affect the amount of productive
work produced by various ethnic groups. (Bhui,
2005)

31. Research MethodologyResearch Methodology

32. Methods and ProceduresMethods and Procedures
•The study employed a cross-sectional,
quantitative, observational research design.
•The study examined and utilized 1,236 viable
survey responses.
•Each Respondent was a member of the National
Society of Hispanic MBAs.
•The goal of the collected data was to expand the
research findings established by Blancero and
DelCampo (2003).

33. Research InstrumentResearch Instrument
• The study employed the use of a survey to
gather data about Perceived Organizational
Support and Psychological Contract Fairness
perception in a sample of Hispanic business
professionals.
• Respondents accessed the survey at
www.surveymonkey.com.
• Restricted access to the survey was utilized to
maintain integrity and anonymity.

34. Statistical MethodologyStatistical Methodology
• Trust
– Primary Dependent Variable in the study
– Measured with three survey items taken from
a study conducted by Brockner, Siegel, Daly,
and Tyler (1997)
– Items are rated on a five point Likert Scale.
– The average of the three items represents the
total Trust composite score.

35. Statistical MethodologyStatistical Methodology (cont’d.)(cont’d.)
• Psychological Contract Fairness
– Mediator in the study.
– Measured with five survey items selected
from Robinson and Rousseau’s (1994) study.
– Items are rated on a seven point Likert Scale.
– Items are worded so that higher level of
agreement indicates stronger composites.

36. Statistical MethodologyStatistical Methodology (cont’d.)(cont’d.)
• Organizational Support
–Independent Variable in the study.
–Measured with nine survey items from
the study by Hutchinson, Sowa,
Eisenberger, and Huntington (1986)
–Items are rated on a seven point Likert
Scale.
–The composite score consists of the
mean item score for these nine items.

37. Statistical MethodologyStatistical Methodology (cont’d.)(cont’d.)
• Perceived Discrimination
–Moderator in the study.
– Measured with six survey items taken from a
study conducted by Sanchez and Brock
(1996).
– Items are rated on a seven point Likert Scale.
– The mean item score for each of the six items
constitutes the composite score for Perceived
Discrimination.

38. Statistical MethodologyStatistical Methodology (cont’d.)(cont’d.)
• Leader-Member Exchange
–Mediator in the study.
– Measured with five survey items taken from a
study conducted by Dunegan, Duchon and
Uhl-Bien (1992).
– Items are rated on a seven point Likert Scale.
– The Leader-Member Exchange score in this
study reflects the mean item score of these
five items.

39. Statistical MethodologyStatistical Methodology (cont’d.)(cont’d.)
• Procedural Justice
–Moderator in the study.
– Measured with seven survey items taken from
a study conducted by Colquitt (2001).
– Items are rated on a seven point Likert Scale.
– The mean item score for each of the seven
items constitutes the composite score for
Procedural Justice.

40. Demographic andDemographic and
Background VariablesBackground Variables
• Five demographic and background
variables utilized in the study:
– Age
– Gender
– Total work experience
– Tenure with current supervisor
– Tenure with organization.

41. PATH ANALYSIS INPUT MODEL
E3
Leader-Member
Exchange
TRUST
Psychological
Contract
Fairness
Organizational
Support
E1
E2
Age
Gender
Total Work
Experience Tenure
with
Supervisor Tenure with
Organization
1
1
1

42. Research Results andResearch Results and
Survey FindingsSurvey Findings

43. Research Results and SurveyResearch Results and Survey
FindingsFindings
• Descriptive Statistics for the demographic
and background characteristics of the
Respondents include:
– Majority of the Respondents (59.6%) were male.
– Average Age: 36.12 years. (SD = 7.67 years)
– Average total work experience: 10.09 years
(SD = 7.73 years)
– Average tenure with organization: 4.46 years
(SD = 5.21 years)
– Average tenure with current supervisor: 1.87
years (SD = 2.47 years)

44. Research Results and SurveyResearch Results and Survey
FindingsFindings (cont’d.)(cont’d.)
• Reliability Coefficients (Cronbach’s α) for
the six composite scores were all
adequate:
– Organizational Support .93
– Leader-Member Exchange .89
– Psychological Contract Fairness .81
– Perceived Discrimination .91
– Procedural Justice .94
– Trust .90
(Adequate reliability = .70, scores sufficiently reliable)

45. Research Results and SurveyResearch Results and Survey
FindingsFindings (cont’d.)(cont’d.)
• All correlations were statistically significant. (all
ps < .001)
– Org. Support positively correlated with LMX (r = .58)
– Psych. Contract Fairness (r = .54), Procedural Justice
(r = .57), and Trust (r = .70) negatively correlated with
Perceived Discrimination (r = -.35)
– LMX positively correlated with Psych. Contract
Fairness (r = .47), Procedural Justice (r = .68), and
Trust (r = .74), and negatively correlated with
Perceived Discrimination (r = -.43)

46. Research Results and SurveyResearch Results and Survey
FindingsFindings (cont’d.)(cont’d.)
– Psych. Contract Fairness was positively correlated
with Procedural Justice (r = .44) and Trust (r = .56),
and negatively correlated with Perceived
Discrimination (r = -.27)
– Perceived Discrimination was negatively correlated
with Procedural Justice (r = -.41) and Trust (r = -.45),
while Procedural Justice and Trust were positively
correlated (r = .65)

47. PATH ANALYSIS OUTPUT
MODEL FOR DIRECT EFFECTS
E3
Leader-Member
Exchange
TRUST
Psychological
Contract
Fairness
Organizational
Support
E1
E2
Age
Gender
Total Work
Experience Tenure
with
Supervisor Tenure with
Organization
.33
.58
.54 .29
.47
.15
.67
.35
-.01
-.02
.01
-.01
-.01
-.06
.71
.40
.23
-.04
-.08
-.03
.40
.23
.40

48. Summary, ConclusionsSummary, Conclusions
and Recommendationsand Recommendations

49. Summary of FindingsSummary of Findings
1. Participants who had higher scores on
the Psychological Contract Fairness
scale also tended to have higher scores
on the Trust scale, and this trend was
statistically significant.
Participants who felt a stronger
sense of agreement between
themselves and their organization
had higher levels of Trust.

50. Summary of FindingsSummary of Findings (cont’d.)(cont’d.)
2. The participants who had higher scores
on the Leader-Member Exchange scale
also tended to have higher scores on the
Trust scale.
Thus when the level of exchange
between the leader and the
member was higher, the
participants had higher levels of
Trust.

51. Summary of FindingsSummary of Findings (cont’d.)(cont’d.)
3. Those participants with the perception
that they were supported more by the
organization tended to have higher
levels of Trust.
Conversely, those participants
with a perception that they were
supported less by the organization
tended to have lower levels of
Trust in the organization.

52. Summary of Findings (cont’d.)Summary of Findings (cont’d.)
4. The results from the mediation tests in the path
model indicated that Leader-Member
Exchange was a mediator of the relationship
between Organizational Support and Trust.
Participants who perceived a high level
of support from the organization also
tended to feel there existed a higher
level of exchange between their leader
and them.

53. Summary of FindingsSummary of Findings (cont’d.)(cont’d.)
5. The mediation test results indicated that
individuals who perceived a high level of
support from their organization tended to
perceive a stronger Psychological Contract
Fairness between the organization and them,
again, leading to higher levels of Trust.

54. Summary of FindingsSummary of Findings (cont’d.)(cont’d.)
6. The moderation tests indicated that Perceived
Discrimination scores did not moderate
relationship between level of support from
the organization and the degree of Trust.
Participants who felt a high level of
support from the organization trusted
the organization more, regardless of
whether or not they Perceived
Discrimination from the organization.

55. Summary of FindingsSummary of Findings (cont’d.)(cont’d.)7. The results from the moderation tests indicated
that perceptions of Procedural Justice did not
affect the positive relationship between the
perceived level of support from the
organization and the level of Trust in the
organization.
Regardless of whether an individual felt
that there was a high level of
Procedural Justice or a low level of
Procedural Justice, if the individual
perceived a high level of support from
the organization, he or she tended to
have more Trust in the organization,
and vice versa.

56. ConclusionsConclusions
• Trust
– The level of an employee’s Trust in the Organization directly
relates to the level of Organizational Support perceived by the
employee
– Higher levels of Trust resulted from employee perceptions of
• Positive working relationship with management
• Existence of Psychological Contract Fairness
• Adequate levels of Organizational Support
– Consistent with Brockner et al. (1997)
• Trust dependent on Trustee engaging in desired behaviors
• Desired behavior is Organizational Support provided to the
employee.
– Consistent with Rhoades and Eisenberger (2002) and Coyle-
Shapiro and Conway (2005)
• Higher levels of Organizational Support result in positive employee
mood, job satisfaction, decreased withdrawal behavior, better job
performance, and affective commitment to the organization

57. ConclusionsConclusions (cont’d.)(cont’d.)
• Psychological Contract Fairness and Leader-Member
Exchange
– Partially mediated the relationship between Organizational
Support and Trust
– Portion of the relationship between Organizational Support and
Trust depends on
• The extent of the employee’s perception of valid Psychological
Contract Fairness with his or her manager and the organization; and
• The existence of employee’s perception of a positive working
relationship with his or her manager.
– Mediation deemed “partial” as the relationship between
Organizational Support and Trust remained even after
accounting for the effects of the mediators.
– Findings lead to conclusion of an intricate interaction among
Organizational Support, Leader-Member Exchange, and
Psychological Contract Fairness.

58. ConclusionsConclusions (cont’d.)(cont’d.)
• Procedural Justice and Perceived Discrimination
– Neither Procedural Justice nor Perceived Discrimination moderated the
relationship between Organizational Support and Trust. Neither
construct interfered with the positive effect of Organizational Support on
Trust.
– Perception of the existence of Procedural Justice within the organization
resulted in higher levels of Trust in the organization by the employee. (r
= .65)
– Employees’ perception of a lack of discrimination within the organization
tended to result in higher levels of Trust in the organization by the
employees. (r = -.45)
– Consistent with Liebkind and Jasinkkaja-Lahti (2000), Bhui (2005), and
Darity (2003)
• Perceived Discrimination negatively related to Trust. (Liebkind and
Jasinkkaja-Lahti, 2000)
• Perceived Discrimination resulted in lower levels of organizational
commitment. (Bhui, 2005)
• Broader effects of Perceived Discrimination include stress and mental
illness. (Darity, 2003)

59. ConclusionsConclusions (cont’d.)(cont’d.)
• Procedural Justice and Perceived Discrimination
– Lack of moderation on Trust by Procedural Justice and
Perceived Discrimination inconsistent with Mayer et al.
(1995).
• Relationship between Organizational Support and Trust
should be moderated by
– Economic factors
– Psychological factors
• Current study utilized Procedural Justice as economic factor
and Perceived Discrimination as psychological factor
• Pursuant to Mayer et al. (1995), Procedural Justice and
Perceived Discrimination should have moderated
relationship between Organizational Support and Trust, but
they did not.

60. RecommendationsRecommendations
• Organizational Practice
– Organizations and managers must:
• attend to the mechanisms by which Trust can be
increased
• consider the effects of Organizational Support on
the perceived quality of the Leader-Member
Exchange, and the perceived strength of
Psychological Contract Fairness
• consider the effects of Organizational Support, the
quality of the Leader-Member Exchange, and the
validity of Psychological Contract Fairness
regardless of the existence of Procedural Justice
and/or lack of discrimination.

61. • Future ResearchFuture Research
– Exploration of the absence of moderation by
Procedural Justice and Perceived Discrimination
on Organizational Support and Trust.
• Mayer et. al (1995) model suggests that moderation
should exist.
• Examine economic and psychological factors in
addition to Procedural Justice and Perceived
Discrimination.
– Utilization of longitudinal studies to capture the
complexity of the relationships among the study
variables.
• Present study examined the employment relationship
at a single point in time.
• Future studies should explore the development of the
employment relationship over a number of years.

62. Thank YouThank You
andand
Good DayGood Day