An Empirical Study on the Organizational Trust
2. Theory and Hypotheses
2.4. Mediating Effect of Organizational Trust
Formation of a psychological contract is a reflection of organizational trust, and employees will construct their psychological contacts depending on the degree of incentives provided by the organization. Employees with high-level organizational trust will undertake more reciprocal behaviors for their organization. If the quality of EOR is high, the organization tends to provide employees with secure employment and a variety of rewards (e.g., economic or social incentives). In other words, organizations should be responsible for employees, which means that organizations should be willing to invest and maintain a stable and long-term exchange relationship with employees rather than a short-term and pure economic exchange relationship with employees.
According to the social exchange theory, EOR will promote employee's trust in their organization, which in turn leads to individual positive behaviors. Therefore, when employees and the organization have a high-level exchange, employees perceive that inducements provided by the organization are more than, or equal to, their actual contributions to the organization, and will form their psychological contract and organizational trust. In turn, to exchange for organization inducements, employees believe they have responsibilities to make expected efforts and contributions to organization. Therefore, they are willing to be loyal to the organization, learn company-specific skills, and perform more innovative behavior to improve their work performance.
High-quality relationships between employees and the organization means organization provides employees with good welfare, employment protection, and career development, which, thus, makes employees perceive themselves as well-treated, and view their organization as trustworthy, which may cause employees to devote more effort and increase innovative behavior in the workplace. Thus, we propose the following prediction:
H4: Organizational trust mediates the positive relationship between EOR and innovative behavior.