The Effect of Abusive Supervision on Employee Job Performance: The Moderating Role of Employment Contract Type

Abstract

Extant literature has documented mixed findings concerning the relationship between abusive supervision and employee performance. While most studies show a negative relationship, others reveal that abusive supervision can be motivating and performance-enhancing, and still others find no effect. To advance our understanding of this relationship, the present study examines employees’ objective and quantifiable key performance indicators (KPIs) as an outcome, while investigating employment contract type as a critical boundary condition. This study also explores an alternative outcome of abusive supervision by examining whether its effects extend to employees’ behavior towards customers, specifically in the form of customer-directed sabotage. A two-wave multi-source field study was conducted with 1,331 customer service representatives from 139 call-center teams. Findings suggest an alarming phenomenon: for probationary employees, an inverted U-shaped relationship exists between abusive supervision and employees’ KPIs, such that low to moderate levels of abusive supervision increase, but moderate to high levels of abusive supervision decrease, their job performance. For permanent employees, KPIs are less affected by abusive supervision. However, abusive supervision is positively related to employees’ customer-directed sabotage behavior, and this effect is stronger for permanent (vs. probationary) employees. The theoretical and practical implications of the findings for leadership and business ethics are discussed.