Aftershocks of Leadership Favoritism: How to Direct Observers’ Negative Gossip and Role Modeling Proactive Behavior

Leadership favoritism is often regarded as an “open secret” in the workplace, yet little is known about how employees who are not favored (i.e., observers) respond when they witness such behavior. To address this gap, the present study draws on Leader–Member Exchange Social Comparison (LMXSC) theory to examine observers’ attitudinal and behavioral responses to leadership favoritism. Based on survey data from 267 employees, the proposed hypotheses were tested using Structural Equation Modeling (SEM). The results indicate that leadership favoritism significantly increases observers’ perceived unfairness and decreases their perceived peer competence. Furthermore, perceived unfairness reduces observers’ role modeling practice behavior and increases negative gossip, whereas perceived peer competence enhances role modeling practice behavior and reduces negative gossip. This study contributes to the literature by expanding leadership favoritism research from the observer’s perspective and by identifying the mediating mechanisms of perceived unfairness and perceived peer competence, while practically highlighting that reducing favoritism, improving fairness perceptions, and fostering recognition of employees’ competence can improve workplace relationships and promote organizational performance.