Employee attributions and employee exchange relationships: the moderating role of leader-member exchange

Abstract

The purpose of this study was to investigate the extent to which the association between employees’ attributions towards downsizing and exchange relationship between employee and organization are moderated by employees’ perceptions of LMX. Most of the literature regarding downsizing focuses on the employees targeted by the organization. By developing a new scale that divides attributions in to perceived necessity and cost, we have focused on remaining employees. In line with our expectations, the results showed a positive relationship between employees’ attributions of necessity and social exchange. In addition, we found a positive relationship between employees’ attributions of cost and economic exchange, as well as a negative relationship between attribution of cost and social exchange. Fortunately, our results predict that LMX is a moderating factor, and if the employee perceive a high-quality relationship with their leader, the damages to the social exchange relationship could be mitigated. These findings suggest that LMX serves as a buffer for “carry-over” effects from employees’ attributions and the exchange relationship.