High Commitment Compensation Practices and Employee Turnover Intention: Mediating Role of Job Satisfaction

Abstract

This study explores the relationship between employees’ perceptions of high commitment compensation practices (a particular subsystem of High Commitment Human Resource Management Practices) and their turnover intention in the Ready-made garment (RMG) industry of Bangladesh. In addition, the current research examines job satisfaction as mediator in the stated relationship. Partial Least Square Path Modeling in Structural Equation Modeling was employed to test the hypothesized relationship on sample data of 346 operators working in RMG organizations in Bangladesh. A judgmental purposive sampling technique was used to select the sample respondents. Data were collected from the operators about their level of turnover intention, job satisfaction and high commitment compensation practices in 2014. Results demonstrate that employees’ perceptions of high commitment compensation practices (HCCPs) reduce the likelihood of their turnover intention. It is found that job satisfaction mediates the above relationship. The findings lead us to believe the importance of understanding the perceptions of HCCPs and related aftereffects at employee level, and to contemplate the effect of job satisfaction in this relationship, if we are to comprehend their influences on organizational performance.

DOI: 10.5901/mjss.2015.v6n6s4p321