Formality of HRM practices matters to employees satisfaction and commitment

• Main Authors: Hashim, Junaidah, Ismail, Yusof, Hassan, Arif
• Format: Article
• Language: English
• Published: American Research Institute for Policy Development 2016
• Subjects: HD28 Management. Industrial Management; HD4801 Labor. Work. Working class
• Online Access: http://irep.iium.edu.my/88144/7/88144_Formality%20of%20HRM.pdf; http://irep.iium.edu.my/88144/; http://jhrmls.com/vol-4-no-1-june-2016-jhrmls

This study examines the extent of formality of Human Resource Management practices among micro enterprises and their effects on employees’ satisfaction and commitment. It used a self-developed questionnaire with some adaptation to the measurement used by Kaman et al. (2001). There are 11 constructs tested which included practices such the use of job advertisement, formal selection process, written job descriptions, formal performance appraisal, training, pay slip, and provision of basic benefits. Measurement of satisfaction and commitment were adopted previous studies. The target population for this study was all for profit business enterprises that had ten or fewer employees, involving 857 employees working in micro enterprises in Kuala Lumpur. The results revealed that HRM practices in micro enterprises to some extent are formal, employees are satisfied and committed. Employees’ commitment was predicted based on two predictors; namely HRM practices and job satisfaction. Employees’ commitment variance is 68.0 percent explained by the predictors and it is significant. This is one of a few studies that provide new data on HRM practices in firms with 10 or fewer employees, and one of the first to examine empirically the relationship between specific HRM practices and employees’ behaviour in such firms.