Third-party perceptions of a layoff: Procedural, derogation, and retributive aspects of justice.

Abstract

Third-party observers (N = 123) learned about a layoff from a newspaper article developed for this study. Two aspects of the layoff procedure were manipulated in the article: (a) the level of input (voice) by layoff victims in the layoff procedure and (b) how the layoff was communicated to the victims. Both variables predicted observers' perceptions of the procedural justice of the layoff. Victim derogation was positively related to observers' procedural fairness of the layoff. Victim derogation also moderated the relationship between the justice manipulations and fairness. Procedural fairness predicted observers' behavioral intentions both as a customer and potential employee.After more than a decade of downsizing, companies in North America continue to restructure. Since 1980, the CEOs of Fortune magazine's top 500 firms have laid off more than 8 million people. More than 85% of these companies have downsized in the last 5 years, and 100% are planning to do so in the next 5 years (Cameron, 1994).Research has shown that how corporations handle layoffs is significantly related to perceptions of fairness on the part of hoth the job-loss victims (Jahoda, 1982) and the survivors (Brockner, 1988;Brockner et al., 1994). To date, however, research has not examined layoffs from the perspective of the third-party observer-a person who is not directly impacted by the layoff but who nonetheless may make fairness judgments of the event. Included in this group are a company's customers, its potential employees, and members of the public.Research on how observers assess and react to the way others are treated has potentially important implications for both the theory and practice of industrial and organizational psychology. At the theoretical level, existing justice

The Psychology of Own Versus Others’ Treatment: Self-Oriented and Other-Oriented Effects on Perceptions of Procedural Justice

“…As we noted earlier, notwithstanding exceptions such as the studies by Lind et al (1998), Brockner et al (1994, Skarlicki et al (1998), and Lerner and Somers (1992), the bulk of procedural justice research nowadays seems to focus on individuals' own experiences. For instance, van den Bos, Lind / OWN VERSUS OTHERS' TREATMENTresearchers typically tend to measure how individual employees react to their own experiences in corporate reorganization processes (for overviews, see Lind & Tyler, 1988).…”

“…These and other findings (for overviews, see Lind & Tyler, 1988;Thibaut & Walker, 1975;Tyler & Lind, 1992) suggest that reactions to procedures are affected by other-oriented considerations; that is, procedural fairness is not entirely or even largely egocentric. Research on survivors' justice judgments in corporate layoff situations shows that others' experiences can have very substantial effects on one's own evaluations of procedural justice (e.g., Brockner & Greenberg, 1990;Brockner et al, 1994;Skarlicki, Ellard, & Kelln, 1998;cf. Lerner & Somers, 1992).…”

Stakeholder Relationships and Social Welfare: A Behavioral Theory of Contributions to Joint Value Creation

“…For example, Cording et al (2014) showed that the firm's treatment of customers following a merger affects employee productivity, and Skarlicki, Ellard, and Kelln (1998) showed that customers who perceive a layoff as unfair are less likely to buy the firm's products.…”

Is Compensation Enough? Relational Concerns in Responding to Unintended Inequity

“…Further investigations may reveal that the additional effect of small relational considerations, such as those employed in this research, are even more robust than our fi ndings demonstrate. When considering these limitations, however, it is important to note that even third-party perceptions of procedural injustice may provoke negative reactions that still impact the group (Skarlicki, Ellard, & Kelln, 1998;Vidmar, 2001).…”