ELIZABETH KAFUI SENYA

ACCRA TECHNICAL UNIVERSITY

DEPARTMENT OF HCIM

EMAIL :eksenya@atu.edu.gh

LOLONYO LETSA

HO TECHNICAL UNIVERSITY

EMAIL: Llesta@htu.edu.gh

EUNICE MATEY ANAKWA

HOCATT

Email :Anakwarunimatey@gmail.com

FREDRICK OWUSU ARTHUR

UNIVERSITY OF CAPE COAST

Email: frededrickowusuarthur@gmail.com

Abstract

Drawing from psychological contract and social exchange theories, this paper proposes and tests a research model where prosocial organisational behaviour mediates the impact of psychological contract breach (PCB) on employee performance in hotels. With data from a sample of 84 hotel employees, the structural model equations reveal that prosocial behaviour has a positive significant effect on employee performance. Psychological contract breach shows a negative effect on employee performance; and this relationship is not mediated by prosocial organisational behaviour. However, prosocial behaviour partially mediates the positive relationship between organisational identification and employee performance among hotel employees in Ghana. The study recommends that to enhance employee performance among employees, organisations like hotels should emphasise organisational identification more by encouraging the building of a diverse culture that includes people from different backgrounds. Encourage employee interaction through corporate picnics or team-building contests. Encourage team members to embrace individual differences as positive rather than negative.

Keywords: psychological contract, employee performance, organizational behaviour, contract breach, hotels

1. Background

Understanding the connection between psychological contracts, organisational identity, and employee performance is critical in the fast-paced hotel business for sustaining high levels of service quality and employee satisfaction. Psychological contracts, or unwritten mutual expectations between employees and employers, play an important role in determining employees’ attitudes and behaviours. A good psychological contract increases organisational engagement and lowers scepticism among hotel personnel (Gharib & Khairy, 2019). In contrast, violations of psychological contracts can have negative consequences, such as decreased job satisfaction, poorer work engagement, and greater turnover intentions (Abdalla et al., 2021; Ampofo, 2020).

The COVID-19 pandemic highlighted challenges in the hospitality industry, emphasising the significance of preserving trust and decreasing emotional weariness among personnel (Abdalla et al., 2021). Despite these challenges, work-life balance and leadership behaviours have been demonstrated to reduce the negative effects of psychological contract breaches, improving employee performance and prosocial behaviour (Jiang et al., 2020; Kaya & Karatepe, 2020).

Prosocial organisational behaviour, which includes behaviours aimed at benefiting others inside the organisation, emerges as a key mediator in the link between psychological contract violations and employee performance. Empirical research indicate that prosocial behaviour can mitigate the negative consequences of contract breaches by encouraging greater levels of work performance and organisational citizenship behaviours (Fatoki, 2019; Shao & Peng, 2022). Furthermore, organisational identification, in which employees align their self-concept with their organization’s identity, has a significant effect on their engagement in prosocial behaviours, hence improving hotel performance and sustainability initiatives (Peng et al., 2020).

The relationship between psychological contracts, organisational identity, and employee performance is intricate and diverse. According to research, violations in the psychological contract have a detrimental influence on life satisfaction and engagement, resulting in lower pro-environmental behaviours and organisational commitment. However, strong organisational identity can help to mitigate these negative consequences, promoting a resilient and devoted staff (Khairy et al., 2019; Tufan & Wendt, 2019).

Understanding these dynamics is critical for hotel managers looking to improve staff performance and organisational effectiveness. Hotels can enhance employee satisfaction, performance, and overall organisational success by cultivating a healthy organisational culture, assuring psychological contract fulfilment, and encouraging prosocial behaviours.

2. Statement of the Problem

Despite considerable research on the dynamics of psychological contracts, organisational identity, and employee performance in the hotel business, major gaps and inconsistencies remain. Previous research has found that breaches of psychological contracts lead to decreased work satisfaction, poorer engagement, and higher turnover intentions (Ampofo, 2020; Abdalla et al., 2021). However, there is a limited knowledge of the processes by which prosocial organisational behaviour mediates these interactions, particularly in the hotel industry.

Research has demonstrated that prosocial behaviours can mitigate the negative effects of psychological contract violations, hence improving employee performance (Fatoki, 2019; Shao & Peng, 2022). Nonetheless, the specific role of prosocial organisational behaviour as a mediator between psychological contract violations, organisational identity, and employee performance is underexplored. While some research show that organisational identification has a positive impact on prosocial behaviours and overall performance (Peng et al., 2020), others indicate that psychological contract breaches can significantly impair these advantages (Karatepe et al., 2020; Ampofo et al., 2022).

Furthermore, there are discrepancies in the findings regarding the effect of psychological contract breaches on employee performance. For example, while some research suggests that breaches reduce life satisfaction and engagement (Karatepe et al., 2020; Ampofo et al., 2022), others suggest that strong organisational identification can mitigate these negative effects (Tufan & Wendt, 2020; Zein El Din & El Hessewi, 2019). These inconsistent findings underscore a significant gap in understanding how prosocial behaviour influences the relationship between psychological contract breaches, organisational identity, and employee performance.

This study seeks to address these gaps by investigating the mediating effect of prosocial organisational behaviour in the relationship between psychological contract breaches, organisational identity, and employee performance in the hotel sector. By investigating these relationships, this study aims to gain a better understanding of the factors that drive employee performance and to propose ways for improving organisational success in the hospitality sector.

3. Objectives

The general objective of this study is therefore to examine whether prosocial behaviour mediates the effect of psychological contract breach and organisational identification on employee performance. The specific objectives are as follows:

To examine the effect of prosocial organisational behaviour on employee performance
To determine the effect of psychological contract breach on employee performance with prosocial organisational behaviour as a mediator
To examine the effect of organisational identification on employee performance with prosocial organisational behaviour as a mediator

4. Literature Review

4.1 Theoretical Framework

The social exchange theory gives a framework for understanding psychological contracts. Blau (1964) differentiates between social and economic exchanges, stating that social exchanges include undefined responsibilities, whereas economic transactions entail obligations that are more typically tangible. Priceless and long-lasting social patterns emerge through social trade interactions. Employees’ personal values, according to this idea, affect the results of relationships with peers and employers. Scholars expanded these ideas and categorised social and economic interactions as transactional and relational contracts in the framework of the psychological contract. Transactional contracts, on the other hand, are based on extrinsic variables and focus on concrete, mostly monetary considerations, for a certain length of time—they are clear, static, and limited in scope (Rousseau, 1990). Relational contracts, on the other hand, are based on indefiniteness, dynamism, and extended aims, and they focus on intrinsic elements such as status and recognition, the opportunity for creativity, employment stability, work–life balance, good work ethics, and career progression (Rousseau, 1990).

4.2 Psychological Contract Breach and Employee Performance

When an employee feels the employer has not, or is not fulfilling his (the employer) part of the engagement contract, the employee is likely to be demotivated and be less committed to work; hence reducing performance. This is supported by numerous studies (Bari et al., 2020; Opolot et al., 2020; L. Peng et al., 2021; Zacher & Rudolph, 2021).

H1: PCB has a negative effect on EMP_PERF

4.3 Organisational Identification and Employee Performance

When an employee identifies with his or her workplace, organisational membership becomes a component of his or her self-concept. Instead of an external force tying the personnel and the company, such inclusion creates a natural sense of we-ness (Meyer, Becker and Van Dick 2006). Organizational identification has been demonstrated to have a substantial impact on work attitudes (such as job satisfaction, organisational commitment, and desire to leave) and behavioural outcomes (such as in-role and extra-role performance) in empirical studies (Riketta 2005).Organisational identification has a positive effect on employee performance (Efraty & Wolfe, 1988; Liu et al., 2011; Tuna, 2018).

H2: OID has a positive effect on EMP_PERF

4.4 Prosocial Organisational Behaviour and Employee Performance

Numerous studies have shown that prosocial behaviour impacts employee performance within organizations (Baruch et al., 2004; Frazier & Tupper, 2018; Yaakobi & Weisberg, 2020). Cooperating with co-workers, suggesting ways to improve the organization, and speaking favourably about the organization to outsiders. These patterns of behaviour are particularly interesting in that they are clearly necessary for organizational survival through enhanced employee performance (Baruch et al., 2004).

H3: POB has a positive effect on EMP_PERF

4.5 Psychological Contract Breach and Prosocial Organisational Behaviour

Several studies established the negative link between PCB and POB (Coyle-Shapfro, 2002; Griep et al., 2020; Li et al., 2021; Morsch & Dijk, 2020). Employees who perceive breaches of their psychological contracts may react by decreasing both their in-role and extra-role behaviours. One assumes that the employees who experience PCB in the hotels under investigation should reduce the voluntary helping behaviours toward their colleagues and the organization. Thus, the fourth hypothesis proposes a direct negative relationship between PCB and POB.

H₄: PCB has a negative effect on POB.

4.6 Organisational Identification and Prosocial Organisational behaviour

Studies over the years have found that organisational identification positively affects prosocial organisational behaviour (Contreras-Pacheco et al., 2021; Lee, 1999). Employees with a sense of belongingness to the hotels and a sense of oneness with the hotels are more likely to provide help to other employees and the organisation. The fifth hypothesis is as follows.

H5: OID has a positive effect on POB

5. Methodology

The study adopted a survey design. This design was deemed appropriate because in surveys the researcher is an outsider which increases reliability and eliminates subjectivity. The study area covered by this research is Accra metropolis. The sample size was calculated using Krejcie and Morgan (1970) on the basis of which a sample of 132 employees across 8 hotels in Accra was targeted. The study however achieved a sample size of 84 (i.e. 63.6% response rate).

The data for this study were collected through primary source with the use of questionnaire. The questionnaire comprised of two sections. The first section contained questions regarding the demographic data, while in the second section, the respondents were asked to express their perceptions regarding the study variables.

Participants were requested to point out their answers on a 5-point Likert type scale, ranging from ‘1’ ‘strongly disagree’ to ‘5’ ‘strongly agree’ on all items under study.

The data collected was processed using SmartPLS software and analysed using the structural equation modelling (SEM). According to Hox and Bechger (1998), SEM combines complex path models with latent variables (factors) in the same study. It is a robust technique that is used in studies with unobserved constructs such those under consideration in this study (Sander and Teh 2014). That is, it provides the avenue to measure unobservable variables with identifiable indicators. The method utilizes the features of factor analysis and multiple regressions that helps examine the relationship between endogenous and exogenous variables (Bagozzi and Fornell 1982; Gefen et al. 2000; Hairet al. 2006; Hair et al. 2017). This helps reduce first-generation statistical tool challenges that include the examination of only one single relationship at a single point in time (Gefen et al. 2000; Hair et al. 2006). Structural equation modelling permits the extension of longitudinal data within a single framework to conform to a study’s conceptual framework and hypotheses (Preacher et al. 2008; Gunzler et al. 2013). Furthermore, it enables the combination of categorical, discrete, and continuous variables. The rule is that the observed variables may be categorical or discrete, but the latent variables must be continuous (Civelek 2018).

5.1 Measurement Model Assessment

Partial Least Square reliability test in SEM uses two methods, namely Composite Reliability and Cronbach’s Alpha. Cronbach’s Alpha measures the lower limit of a construct’s reliability value while composite reliability measures the actual value of a construct’s reliability. The value of composite reliability must be greater than 0.7 although, in many cases, the value of 0.6 is still acceptable (Suprapto et al., 2020). Using the Cronbach’s Alpha, the rule of thumb for decision-making according to Manerikar and Manerikar (2015) is as follows: α < 0.5 is unacceptable; 0.5 ≤ α < 0.6 is poor; 0.6 ≤ α < 0.7 is acceptable; 0.7 ≤ α ≤ 0.9 is good; and α > 0.9 is excellent.

There are two types of validity- convergent validity and discriminant validity. Convergent Validity is measured by the Average Variance Extracted (AVE). According to Suprapto et al. (2020), the minimum recommended AVE is 0.5. Hair Jr. et al. (2010) also asserted that AVE values less than 0.5 are also acceptable as long as the composite reliability is higher than 0.6.

Discriminant Validity on the other hand measures differentiation in the constructs; and how different are the constructs from each other. This can be established by three methods: the Fornell-Larcker Criterion, Cross Loadings, or Heterotrait-Monotrait Ratio. In this study, the Fornell-Larcker criterion is applied and supported by the HTMT ratio which must not be more than 0.85. To establish discriminant validity, the square of AVE for each construct should be greater than the correlation coefficient between the constructs. (Ab Hamid et al., 2017; Henseler et al., 2015).

5.2 Structural Model Assessment

The structural model explains how the variables are related with each other (Hox & Bechger, 1999; Tempelaar et al., 2007). This is done by determining the path coefficients through bootstrapping.

6. Results

The respondents’ profile is first presented for examination in Table 1.

Table 1: Respondents’ Profile

		Frequency	Percent
Gender	Male	8	10%
	Female	76	90%
	Total	84	100%
Age group	Below 30	8	10%
	31-40	74	88%
	Over 50	2	2%
	Total	84	100%
Highest level of Education	NVTI	2	2%
	HND	76	91%
	Bachelors	4	5%
	Masters	2	2%
	Total	84	100%
Type of Employment	Permanent	48	57%
	Temporary (Casual)	10	12%
	Fixed Term (Contract)	16	19%
	Attachment	10	12%
	Total	84	100%
Years in employment relationship	Less than 1	18	21%
	1-5	58	69%
	6-10	4	5%
	Over 10	4	5%
	Total	84	100%

The respondents’ demographic profile presented in Table 1 reveals that the majority of the participants in this study were female (90%, n=76), aged below 50 (98%, n=82) with at least an HND (98%, n=82). The majority were also permanent (57%, n=48) employees who had been in engagement with their organisations for more than a year (79%, n=66%).

6.1 Assessment of Measurement Model

This section seeks to check the quality of the measures by testing for reliability and validity of the constructs. Reliability refers to consistency; while validity refers to accuracy (whether the items are actually measuring the constructs or what they intended to measure). The model results are shown in Figure 1. The results in Figure 1 show that all the factors report a loading greater than 0.5 as desired (Akgül, 2019; Jennex, 2019; Salvendy & Smith, 2009).

Figure 1: Factor Loadings

6.1.1 Reliability

Table 2 shows the reliability and validity results. Partial Least Square reliability test in SEM uses two methods, namely Composite Reliability and Cronbach’s Alpha. Cronbach’s Alpha measures the lower limit of a construct’s reliability value while composite reliability measures the actual value of a construct’s reliability. The value of composite reliability must be greater than 0.7 although, in many cases, the value of 0.6 is still acceptable (Suprapto et al., 2020).

Using the Cronbach’s Alpha, the rule of thumb for decision-making according to Manerikar and Manerikar (2015) is as follows: α < 0.5 is unacceptable; 0.5 ≤ α < 0.6 is poor; 0.6 ≤ α < 0.7 is acceptable; 0.7 ≤ α ≤ 0.9 is good; and α > 0.9 is excellent. The results in Table 2 therefore means that all PCB and POB had good reliability; while EMP_PERF and OID had excellent reliability. Further, the composite reliability values are all greater than 0.7 which implies high internal consistency for the constructs.

Table 2: Results for Construct Reliability and Validity

	Cronbach’s Alpha	rho_A	Composite Reliability	Average Variance Extracted (AVE)
EMP_PERF	0.948	0.949	0.963	0.866
OID	0.931	0.943	0.946	0.745
PCB	0.897	3.682	0.857	0.614
POB	0.896	0.919	0.927	0.762