Employee Perception of Fairness in the Performance Appraisal Process and Its Impact on Performance in Indonesian Startups
Article Sidebar
Main Article Content
Abstract
This study investigates the relationship between employee perceptions of fairness in the performance appraisal process and employee performance in Indonesian start-up companies. A quantitative approach was employed, with data collected from 115 employees using a Likert scale-based survey. The data were analyzed using Structural Equation Modeling - Partial Least Squares (SEM-PLS 3). The results reveal that all three dimensions of fairness—procedural fairness, distributive fairness, and interactional fairness—significantly influence employee performance. Procedural fairness had the strongest positive relationship with performance, followed by interactional fairness and distributive fairness. The findings suggest that employees who perceive the appraisal process as fair in terms of consistency, outcomes, and interpersonal treatment are more likely to exhibit higher job performance. The study highlights the importance of fairness in performance appraisals for fostering a productive work environment in start-up companies.
Article Details
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
References
C. J. Cowandy, “The Impact of Fair Performance Appraisal to Employee Motivation and Satisfaction towards Performance Appraisal–A Case of PT. XYZ.,” iBuss Manag., vol. 2, no. 2, 2014.
J. A. Nanggala, “Analysis The Performance Appraisal Effectiveness On Employee Performance At PT. Pelindo IV (Persero) Bitung,” J. Berk. Ilm. Efisiensi, vol. 16, no. 1, 2016.
A. Idowu, “Effectiveness of performance appraisal system and its effect on employee motivation,” Nile J. Bus. Econ., vol. 3, no. 5, pp. 15–39, 2017.
F. F. Ferdiane, S. W. L. H. Setyanti, and S. Sudaryanto, “Penerapan Sistem Penilaian Kinerja Dengan Intervening Motivasi Dan Kepuasan Kerja Terhadap Kinerja Karyawan,” J. Manaj. dan Kewirausahaan, vol. 6, no. 1, pp. 45–50, 2018.
I. Hayati and A. M. Sari, “The Effect Of Appraisal Performance On Employee Performance,” in Multi-Disciplinary International Conference University Of Asahan, 2019, vol. 1.
M. B. Walsh, Perceived fairness of and satisfaction with employee performance appraisal. Louisiana State University and Agricultural & Mechanical College, 2003.
C. W. Githui and G. Wario, “Employee fairness perception on performance appraisals in the civil service in Kenya,” Int. J. Soc. Sci. Entrep., vol. 1, no. 7, pp. 624–638, 2013.
S. Narcisse and M. Harcourt, “Employee fairness perceptions of performance appraisal: a Saint Lucian case study,” Int. J. Hum. Resour. Manag., vol. 19, no. 6, pp. 1152–1169, 2008.
T. Umair, M. F. Javaid, H. Amir, and M. K. Luqman, “Effect of perceived appraisal fairness on job satisfaction,” J. Appl. Environ. Biol. Sci., vol. 6, no. 2, pp. 12–20, 2016.
D. Van Dijk and M. M. Schodl, “Performance appraisal and evaluation,” in International Encyclopedia of the Social & Behavioral Sciences: Second Edition, Elsevier Inc., 2015, pp. 716–721.
A. Hussain and L. Das, “Employee Performance Appraisal: Key to Success for Organizational Growth,” Int. J. Adv. Eng. Manag. Sci., vol. 1, no. 4, p. 239361.
H. M. Findley, W. F. Giles, and K. W. Mossholder, “Performance appraisal process and system facets: Relationships with contextual performance.,” J. Appl. Psychol., vol. 85, no. 4, p. 634, 2000.
A. Aggarwal and G. S. M. Thakur, “Techniques of performance appraisal-a review,” Int. J. Eng. Adv. Technol., vol. 2, no. 3, pp. 617–621, 2013.
W. F. Giles, H. M. Findley, and H. S. Feild, “Procedural fairness in performance appraisal: Beyond the review session,” J. Bus. Psychol., vol. 11, pp. 493–506, 1997.
P. W. Thurston Jr and L. McNall, “Justice perceptions of performance appraisal practices,” J. Manag. Psychol., vol. 25, no. 3, pp. 201–228, 2010.
C. Chusminah, “Pengaruh Persepsi Keadilan Terhadap Kepuasan Penilaian Kinerja,” J. Ris. Manaj. dan Bisnis Fak. Ekon. UNIAT, vol. 3, no. 2018, 2018.
T. a/l Moorthy, “Organizational Justice in Performance Appraisal System: Its Effects on Performance Appraisal Satisfaction and Work Performance.” Universiti Utara Malaysia, 2011.
D. G. Dal Vesco, I. M. Beuren, and F. Popik, “Percepção de justiça na avaliação na avaliação de desempenho e satisfação do trabalho,” Enfoque: Reflexão Contábil, vol. 35, no. 3, pp. 121–138, 2016.
P. M. Swiercz, M. L. Icenogle, N. B. Bryan, and R. W. Renn, “Do perceptions of performance appraisal fairness predict employee attitudes and performance?,” in Academy of Management Proceedings, 1993, vol. 1993, no. 1, pp. 304–308.
S. Sudin, “Fairness of and satisfaction with performance appraisal process,” J. Glob. Manag., vol. 2, no. 1, pp. 66–83, 2011.
A. Sanhaji, B. E. Soetjipto, and S. Suharto, “Pengaruh Keadilan Organisasi Dan Budaya Organisasi Terhadap Perilaku Kewargaan Organisasi Melalui Komitmen Organisasi Dan Kepuasan Kerja.” State University of Malang, 2016.
R. Rismala, F. Hanurawan, and M. Bisri, “Persepsi keadilan kompensasi sebagai prediktor komitmen organisasi pada karyawan PT Gasulindo Lumajang,” Flourishing J., vol. 1, no. 4, pp. 259–263, 2021.
T. M. Prather, “The Perception of Fairness of Performance Appraisals,” 2010.
L. P. E. Swandini, “Lingkungan Kerja Dan Motivasi Kerja Karyawan Hotel Matahari Beach Resort & Spa.,” Prospek J. Manaj. dan Bisnis, vol. 2, no. 2, p. 139, 2021, doi: 10.23887/pjmb.v2i2.27306.
K. I. Zahroni and Dwi Setya Nugrahini, “Peran Motivasi Kerja dalam Meningkatkan Kinerja Karyawan di LKP Bahana Bina Prestasi Ponorogo,” Niqosiya J. Econ. Bus. Res., vol. 3, no. 1, pp. 30–40, 2023, doi: 10.21154/niqosiya.v3i1.1858.
I. Ardiyansah and M. D. Mon, “Organizational Culture, Organizational Commitment, and Job Satisfaction on Employee Performance Using OCBas an Interveningat State-Owned Enterprises Insurance Company in Batam City,” Bus. Entrep. Rev., vol. 23, no. 1, pp. 69–92, 2023.
A. S. Supriyanto, V. M. Ekowati, Z. T. Pujianto, and Masyhuri, “Employee Engagement: A Quantitative Review and Its Relationship with Job Satisfaction and Employee Performance,” Proc. Int. Conf. Eng. Technol. Soc. Sci. (ICONETOS 2020), vol. 529, no. Iconetos 2020, pp. 268–273, 2021, doi: 10.2991/assehr.k.210421.038.
Y. Kuswati, “The Effect of Motivation on Employee Performance,” Budapest Int. Res. Critics Inst. Humanit. Soc. Sci., vol. 3, no. 2, pp. 995–1002, 2020, doi: 10.33258/birci.v3i2.928.
Y. S. Chen, C. Liu, and L. Song, “The Mediator Role of Job Satisfaction (JS) Among the Relationship Between Electronic Human Resource Management (E-HRM), Employee Performance (EP), and Organizational Commitment (OC) in Family-Owned Small Middle Enterprises (SMEs) in China,” Front. Business, Econ. Manag., vol. 9, no. 1, pp. 229–237, 2023.