Include, care, reward and enhance to build a well-being HRM system based on perceived effectiveness and fairness of HRM practices

Purpose One of the criticisms that can be addressed to the existing HRM literature is that performance is often the primary target, leaving well-being as a secondary consideration. This study aims to put employee well-being at the center of HRM concerns. By focusing on needs-supply fit and social exchange theories, our approach focuses on employees’ perceptions of the effectiveness and fairness of HRM practices. Design/methodology/approach Based on a sample of 740 workers collected via an electronic survey, HRM practices were grouped into bundles using factor analysis to form an HRM system. The impact of the HRM system and its bundles on employee well-being and job performance was analyzed using structural equation modeling (SEM). The mediating role of well-being was tested with Stata’s medsem package. Findings The HRM system and its bundles (Include, Care, Reward and Enhance) derived from the perceived effectiveness and fairness of HRM practices have a positive direct effect on employee well-being and a positive indirect effect on job performance through the mediating role of well-being. However, the bundles have no direct effect on job performance, highlighting the importance of integrating employee well-being into HRM concerns. Originality/value These findings reveal that when employees consider HRM practices to be fair and effective, it promotes their well-being, which has a positive impact on their job performance.