Linking high‐performance work systems and employee well‐being: A multilevel examination of the roles of organisation‐based self‐esteem and departmental formalisation

Abstract Prior research has suggested that the relationship between high‐performance work systems (HPWS) and employee well‐being has been inconclusive, and particularly less is known about the underlying mechanisms and the boundary conditions between them. Integrating signalling theory with uncertainty reduction theory, we propose a cross‐level model linking department‐level HPWS to employee job burnout. Specifically, we propose the mediating role of organisation‐based self‐esteem (OBSE) in the effect of department HPWS on employee job burnout, as well as the moderating role of departmental formalisation. Using a sample of 366 employees and 60 managers from 60 departments, we found that department‐level HPWS was associated with reduced employee job burnout both directly and indirectly through OBSE. In addition, the mitigating influence of department‐level HPWS on employee job burnout was significant only when departmental formalisation was high. The findings of this study contribute to resolving the inconclusive relationship between HPWS and employee well‐being.