The impact of trust on the effectiveness of participative management practices

This study investigates the relationship between participative management practices and workplace performance. Thereby we focus on the possible association with trust in managers. We deviate between organizational involvement and task related autonomy. Based on earlier literature we expect a positive relation between participative HRM practices (both employee involvement and worker autonomy) and performance. Next to that we expect that trust positively facilitates the relation between performance and employee involvement practices, but not between performance and worker autonomy. In this study we analyze the Workplace Employment Relations Study datasets from 2004 and 2011 using a cross-section and panel sample. Our main results suggest that participative practices are indeed positively related to productivity, but no convincing evidence is found for causality of the relationship. The main cross-section results also show that trust is associated to the HRM-performance relations as expected. The results suggest that the use of involvement practices is only significantly related to performance if trust is sufficiently high. Robustness tests, however, show mixed results. Nonetheless, managers have to be aware of the possible impact of trust on the effectiveness of participative HRM practices