Does pay for individual performance encourage salespeople's customer-oriented pro-social rule breaking? The role of perceived job insecurity and performance appraisal process

Purpose Based on signaling theory, this research aimed to examine the relationship between pay for individual performance (PFP-I) and customer-oriented pro-social rule breaking (C-PSRB), and the mediating role of perceived job insecurity as well as the moderating roles of performance objectivity and performance appraisal satisfaction in this relationship. Design/methodology/approach Surveys were conducted in a large chain retail enterprise in China to collect data in 2 waves, and 1,559 salespeople's questionnaires were ultimately obtained. The hypothesized relationships were tested using hierarchical multiple regression analyses and bootstrapping. Findings The results suggested that PFP-I was positively related to C-PSRB, while perceived job insecurity mediated the relationship between PFP-I and C-PSRB. Additionally, both performance objectivity and performance appraisal satisfaction augmented the positive relationship between PFP-I and C-PSRB as well as the mediating role of perceived job insecurity. Practical implications C-PSRB should be encouraged to improve organizational performance and optimize organizational processes and rules. Organization should set PFP-I for salespeople to promote their C-PSRB. Then, perceived job insecurity does not always lead to stress or health problems. Instead, perceived job insecurity triggered by PFP-I can actually enhance salespeople's performance and bring benefits to the organization. Organization should manage perceived job insecurity. Moreover, organization should set objective performance indicators and enhance performance appraisal accuracy, which enhances their salespeople's performance appraisal satisfaction to encourage C-PSRB. Originality/value This study provides insight into the relationship between PFP-I and C-PSRB, which has been ignored in the extant literature. It further reveals the underlying mechanism of PFP-I and C-PSRB by identifying perceived job insecurity as a mediator and performance objectivity as well as performance appraisal satisfaction as moderators, which has expanded the theoretical perspectives and boundaries of the existing research from the perspective of signaling theory.