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The Journal of International Management Studies, Volume 3, Number 2, August, 2008148

The Quran-Based Human Resource Management and its Effects on

Organisational Justice, Job Satisfaction and Turnover Intention

Associate Professor Dr. Junaidah Hashim, Department of Business Administration, Kulliyyah of Economics and

Management Science, International Islamic University Malaysia

ABSTRACT

An introduction to the Islamic approach of managing human resource is an initial attempt to provide managers

with an effective way of managing and understanding employees. This knowledge would be useful to even non-Muslim

managers. For Muslim human resource managers, it is required for them to not only know but also to apply the Islamic

approach in managing employees. Non-Muslim managers will have a better understanding of the expected behaviours

of their Muslim employees. Muslim employees regardless with whom they work for are expected to be honest,

trustworthy, and determined to continuously strive for the best.

Keywords: Organisational justice, The Quran, Islam, Malaysia, Human resource management.

INTRODUCTION

Effective human resource management (HRM) is crucial for every organisations success. The quality of the

organisations human resources, their sense of fair treatment, their enthusiasm and satisfaction with their jobs, and theirexperience, all affect the organisations productivity, customer service, reputation, and survival (Aghazadeh, 2003).

Many HRM issues in organisations have their foundations in religion (Ali, et al., 2000; Tayeb, 1997). All religions call

for justice in treating employees. It is a universal value. The Ten Commandments in Christianity for instance, urges

management to treat employees equally and reward them accordingly. Similarly, Islam urges all Muslims to promote

and practice justice in every field of life. The Holy Qurn often mentions of honesty and justice in trade, and

repeatedly calls for an equitable and fair distribution of wealth in the society. Justice is an important element in Islamicteaching and should be applied in daily life as stated in the Holy Quran (4:135): O ye who believe! Stand out firmly

for justice, as witnesses to Allah, even as against yourselves or your parents, or your kin and whether it be (against)

rich or poor.

Several studies have been conducted in the past examining the influence of religion on employees behaviour. For

instance, Ali, et al. (2000) has studied the implications of the Ten Commandments of Christianity, Judaism and Islam

on human resource strategy. Past studies have found some relationship between Islamic work ethics with organisational

commitment, job satisfaction, and loyalty (Yousef, 2000; Yousef, 2001; Ali & Al-Kazemi, 2007). However, thesestudies have not addressed the important issue of organisational justice. Organisational justice is shown to have

significant relationship with organisational commitment, satisfaction, and turnover (Cohen-Charash & Spector, 2001;

Colquitte et al., 2001, Wong et al., 2002; Hassan, 2002; Hassan & Chandaran, 2005). Organisational justice is

prevalent in most human resource related issues. Therefore, the present study is designed to investigate the effects of

applying Quranic guidelines in managing human resources on organisational justice, job satisfaction, and turnover

intention among the employees.

The present study is potentially useful as it enhances the existing body of knowledge on the contribution of Islamic

management in organisational behaviour. This would be an important source of reference for those teaching Islamic

management and for those who would conduct further research in this area. This study would provide valuable insights

to Muslim and non-Muslim practitioners who are managing Islamic organisations or managing Muslim workforce formaking better decisions as well as for improving the perceived justice among employees in the organisations.

Malaysia in Brief

Malaysia is a peaceful Muslim state, with Islam as its official religion. After 50 years of independence from the

British, Malaysia is currently one of the most developed countries in Southeast Asia, neighbouring Thailand, Indonesia,

Singapore, Brunei and Philippines. The capital city is Kuala Lumpur while Putrajaya is the seat of the federalgovernment. The total population of Malaysia is 28.3 million consisting of 62 per cent Malays, 24 per cent Chinese, 8

per cent Indians, with other minorities and indigenous people. Malay is the national language of the country. The

Malays, who form the largest community, are defined as Muslims in the Constitution of Malaysia. The Malays play a

dominant role politically and are included in a grouping identified as bumiputra. Malay is the national language of the

country. Native Malays are typically Muslim; Islamic values and beliefs influence their culture heavily. Malaysia is a

democratic country that has undergone a tremendous growth and prosperity over the last two decades (Department of

Statistics, 2004).


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The Journal of International Management Studies, Volume 3, Number 2, August, 2008 149

THEORETICAL FRAMEWORK

Organisational Justice

Greenberg and Baron (2003) defined organisational justice as the peoples perception of fairness in organisations,

consisting of perceptions of how decisions are made regarding the distribution of outcomes and the perceived fairness

of those outcomes themselves. According to Greenberg and Baron (2003), there are three major approaches to

organisational justice - distributive justice, which focuses on the way organisational resources are distributed;procedural justice, which focuses on the processes used to make those resource-allocation decisions, and interactional

justice, focuses on the fairness of interpersonal communication relating to organizational procedures. It is concerned

with how information is communicated and whether the individuals affected by the decisions are treated in a courteousand civil manner. Greenberg and Baron (2003) further elaborated that research has revealed several actions which can

be done to make organisational decisions seem fair, among these are: give people a say in how decisions are made,

provide an opportunity for errors to be corrected, apply rules and policies consistently, and make decisions in an

unbiased manner.

In comparison, Ali et al., (2000) in their study has identified a few implications of The Ten Islamic

Commandments for human resource management. Most of the stated implications address the elements of justice and

fairness. For instance, Ali et al. (2000) mentioned that in hiring, priority should be given to qualified individuals,

disagreement with superiors should be voiced politely, employee layoffs and downsizing should be considered as the

last resort to maintain business survival, management should establish a due process in dealing with employees

grievances, performance should be the main criteria for evaluation and management should avoid favouritism and

nepotism.

Job Satisfaction and Turnover Intention

Job satisfaction is usually defined as an affective or emotional response toward ones job. According to Locke

(1976), job satisfaction is a positive emotional state resulting from the appraisal of ones job or job experiences. It

results from employees perception of their jobs and the degree to which there is a good fit between the individual and

the organisation. According to Greenberg and Baron (2003), job satisfaction does influence organisations, but its effect

is not always as strong as one might expect. However, the effects of job dissatisfaction are more obvious. Most

conceptual models of voluntary turnover assume that job dissatisfaction is the root cause of employee turnover. Chiu

and Francesco (2003) stated that when the overall job satisfaction level is sufficiently low, the person will develop a

behavioural intention to quit his or her job and seek for alternative employment.

Dick et al. (2004) mentioned that turnover is a major problem for many organisations today because it is extremely

costly for the employer especially of jobs which offer high education and extensive on-the-job training. Intention to

leave is one of the strongest predictors and immediate precursor of employee turnover (Dick et al., 2004; Loi, et al.,

2006).

Past researches have demonstrated that procedural justice has positive relationship with organisational commitment,

job satisfaction, and job performance (Cohen-Charash & Spector, 2001; Colquitte et al., 2001; Hassan, 2002; Hassan &

Chandaran, 2005; Williams, et al., 2002; Wong, et al., 2002). Other studies have also reported strong relationship of job

satisfaction with organisational justice (McDowall & Fletcher, 2004) and organisational commitment (Winterton, 2004).

Meanwhile, Chen et al. (2004) in their study found that job satisfaction mediates the relationship between the turnover

intentions. There are mixed results in relation to the linkage between justice and turnover intention. In response to low

distributive justice, employees choose to quit their job so as to end the inequity. Other studies concluded that

procedural justice is negatively related to turnover since procedural justice reflects organisational norms of decision

making (Cohen-Charash & Spector, 2001; Loi et al., 2006).

Few studies have examined the effects of management in Islamic perspective on organisational behavioural

outcomes. For instance, Yousef (1999) discovered organisational commitment and job satisfaction as predictors of

attitudes toward organisational change in a non-western setting. Another study conducted by Yousef (2001), has

identified Islamic work ethics as the moderator between organisational commitment and job satisfaction in a cross-

cultural context. Yousef (2002) in his study on organisations in United Arab Emirates found that job satisfaction

mediates role stressor and organisational commitment. In examining the Islamic work ethics in Kuwait, Ali and Al-

Kazemi (2007) found that there is positive high correlation between Islamic work ethics and loyalty among the

managers in Kuwait.

Quranic Guidelines on Human Resource Management

By viewing the significance of organisational justice, scholars and practicing managers who are concerned about

the existence of organisational justice cannot afford to ignore the potential contribution that human resource

management can make in practicing organisational justice. From the Islamic perspective, the Holy Quran often reminds

of honesty and justice in trade, and calls for an equitable and fair distribution of wealth in the society (Ali & Gibbs,1998, Ali et al., 2000; Yousef, 2001). Islamic management very much emphasises on the principle of justice. This


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requirement is stated in the Holy Quran (4:58), God doth command you to render back your trust to those to whomthey are due; and when ye judge between man and man, that ye judge with justice; verily how excellent is the teaching

is the teaching which He giveth you! For God is He who heareth and seeth all things.

The issue of justice is prevalent in all of human resource management activities. For example in recruitment and

selection of employees, favouritism and nepotism has always influenced hiring decisions. As Ali (2005) has pointed

rightly, selection is one of the most complicated tasks in organisation. This is due to the fact that when there are many

candidates applying for the jobs, employers have plenty of potential candidates to select from. In order to ensure therecruitment is fairly conducted and a just treatment is given to all applicants, Islam requires the person in charge of

recruitment to be pious and just. Ahmad (1995) elaborated that a manager is obliged to perform prayers, fasting, zakat

and other pillars of Islam so to attain best level of piety. According to Ahmad (1995), the Quranic standard ofeligibility for a job is the required merit and competence for it. It stresses the importance of competence and honesty

since without these pre-requisites one could not be efficient. For example, the Holy Quran states, (28:26) Said one ofthe (damsels): O my (dear) father! Engage him on wages: truly the best of men for thee to employ is the (man) who is

strong and trust worthy. Fact is, to overlook the needed competence for a job and to select an applicant for any other

considerations are tantamount to dishonest as well as injustice.

In Islam, employee selection is abided by certain principles. First principle is justice. According to Syed Agil

(1997), Ali Ibn Abi Talib wrote; Do not nominate them (officers) on account of favouritism or egoism. These two

attributes reflect injustice and treachery. Second,an employee is selected based on his competency. The individual is

not to be appointed based on kinship or blood relationship, friendship, wealth, age, race, and political power or alike.

Third principle ishonesty. Both the applicant and recruiter have to be honest. Fourth, Islam forbids assignment of

work that will exceed the individuals capacity. For example, the Quran states, (2:233): No soul shall have a burden

laid on it greater than it can bear. This is because the individual may not be able to perform the assigned job due to

his or her inadequacies. Employers are required to inform the truth about the jobs offered to applicants. These include

the job requirements, the criteria of the job holders, and the compensation to be paid. It is important for the information

to be fairly provided to applicants so that they can evaluate and match well the job suitability with their competency,

capability, interest, and rewards.

Performance appraisal is a formal system of setting work standards, assessing performance, and providing feedback

to employees for the purpose of motivation, corrections and continuation of their performance (Dessler, 2008).

Information obtained from performance appraisal is used as a basis for pay and promotion decisions. In Islam, there are

rewards and punishments in worldly life and the Hereafter. Good news and warning from God to humankind are sent

through His Divine sources of revelation and His Messengers, Al- Quran states (18:87-88): Whoever doth wrong, him

shall we punish; then shall be sent back to his Lord, and He will punish him with a punishment unheard of (before). But

whoever believes, and work righteousness, he shall have a goodly reward, and easy will be his task as we order it by

our command.

Performance appraisal is another HRM activity that is subjected to justice. Appraiser biases are well documented.

There are almost a dozen of known phenomena which prove that supervisors tend to appraise employees inaccurately

because of subconscious tendencies. According to Ali (2005), managers at times find it difficult to appraise their

employees effectively. This is due to religious consideration, personal relationship and bureaucratic tendencies. Thus,

Muslim managers should be aware that measuring performance in Islam must take into account the concept of

accountability and responsibility. Given the responsibility to appraise employees, managers must be fair and care for

their employees.

Training is the process of developing qualities in human resources that will enable them to be more productive and

thus to contribute more to organisational goal attainment. According to the Al-Qurn, mans basic qualification for

being the representative of God on earth is to possess knowledge. God Almighty said, (2:30-33): When the Angels

questioned Adams suitability for representation, God cited Adams knowledge to convince them. Two important

points may be drawn from these verses of the Holy Qurn. First, Adams progeny is entitled to a position as Gods

vicegerent on earth on the basis of knowledge. Second, those among the children of Adam who are more deserving of

vicegerents are those pre-eminent in knowledge. Men of knowledge surpass others, and limit the reception of

admonition to those endowed with knowledge and understanding in ranks in the presence of their Lord, and are more

favoured than others. God Almighty said (58:11); Are those who know equal to those who know not? But only they

who are endowed with understanding keep this in mind. Shaddid b. Aus said: Two are the things which I remember

Prophet Muhammad (peace be upon him) having said: Verily God has enjoined goodness to everything; so when you

kill, kill in a good way and when you slaughter, slaughter in a good way. So every one of you should sharpen his knife,

and let the slaughtered animal die comfortably (Sahih Muslim: Chapter 11, 21:4810). God calls for job mastery. Thus,

it is an obligation for Muslims to seek knowledge diligently and obtain excellence in performance. Muslims are urged

to seek knowledge from the cradle to grave. This great concept creates a state of knowledge continuity.

The duty of seeking knowledge lies on the individual as well as the employer. It is obligatory for Muslim

employees to seek knowledge to serve his employer well. The employer, on the other hand, is responsible to provideopportunities to enable the employees to improve their competencies. The decision on who should attend training


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organized by employer is always subject to the superior. Superior will need to review pertinent information regardingthe employees performance and potentials to recommend the employee for training. Of course, some employees are

more fortunate than others. The unfortunate ones usually perceive they are unfairly treated.

Distributive justice and procedural justice are commonly associated with employees compensation. The purpose

of any compensation, whether direct or indirect, is to recognize the performance value of employees and to establish

ways to motivate them to work with full efficiency in an ever changing business environment. According to Ali et al.

(2005) in the early years of Muslim State, the compensation was based on five foundations. First, employment is acontract, thus the fulfilment of a contract is an obligation for both employer and employee to meet. The Quran not only

instructs believers to meet conditions, but also to avoid any attempt to go around the contract (7:85), Nor withhold

from the people the things that are their due. Second, Islam emphasizes that workers should be given adequate andreasonable wages for their work, keeping in view the quality and quantity of work, their needs and requirement, and the

overall economic condition of the society. Ahmad (1995) says that the Quran acknowledges various gradations among

workers on the basis of the quality and quantity of their work (Quran 46:19). Al-Mubarak (1972) elaborated that some

workers need specific skills, whereas some can do manual work. This provides an ample proof that wages for all

workers cannot be equal in all cases. The Quran states, (46:19) And to all are ranked according to their deeds.

Third, compensation must be determined in advance and wage has to be given immediately once the work is completed.

Prophet (p.b.u.h) said; Whoever believes in God and the Day of Judgment, should not employ a worker, until he or she

knows what he or she is going to receives (quoted in Ahmad, 1995). Fourth, compensation can either be monetary or

non-monetary. Fifth, wages and compensations are based on prior agreement and should be increased according to

circumstances. Ahmad (1995) added that Islam forbids any misuse or misappropriation of an employers property by

his employee, who is entitled to the mutually agreed wages only. Appropriation of anything beyond the stipulated

wages is either an act of dishonesty or stealing both of which are expressly prohibited. In addition, wages and

compensation should be sufficient to provide a decent living. Beekun (1997) asserted that if the wage is too low, the

individual may not feel motivated to put in an adequate amount of effort, while Ahmad (1995) on the other hand, stated

that a worker is entitled to a fair and just wage for his work.

The Quran instructs that wages must be determined with mutual consultation and consent (Quran 28:26-28).

Islam strictly prohibits coercion and forced labour. As narrated by Abu Huraira, the Prophet (peace be upon him) has

said; God says that I will act as a plaintiff, on the Day of Judgment against the person who engages some worker on

work and takes full work from him but does not give him (full) wages (Sahih Bukhari, Volume 3:34:430). At the same

time,Islam denounces slavery and gives proper recognition to the dignity of work and employment. As narrated by

Al-Miqdam, the Prophet (p.b.u.h) has said, Nobody has ever eaten a better meal than that which one has earned by

working with ones own hands (Sahih Bukhari, Volume 3:34:286).

Hypotheses

The present study intends to test the following hypotheses:

H1a: Quran-based HRM practices are directly related to distributive justice.

H1b: Quran-based HRM practices are directly related to procedural justice.

H1c: Quran-based HRM practices are directly related to interactional justice.

H2: Quran-based HRM practices are directly related to job satisfaction.

H3: Quran-based HRM practices are negatively related to turnover intention.

H4a: There exists a direct relationship between distributive justice and job satisfaction.

H4b: There exists a direct relationship between procedural justice and job satisfaction.

H4c: There exists a direct relationship between interactional justice and job satisfaction.

H5: There exists a negative relationship between job satisfaction and turnover intention.

METHODOLOGY

Sample and Data Collection

Data were collected from eight well-known Islamic organisations in Malaysia. In this study, the Islamic

organisations refer to businesses which either have 100 percent Muslim ownership or partnership with Muslims holding

the majority share. Six of the organisations are of the banking and financial business, and the other two are of the

Islamic services business. The total respondents were 121 Muslim employees, who vary in positions and werepurposively selected to represent each of the eight organisations. The data collection was done by trained enumerators.

The enumerators would approach the human resource manager of the organisations in quest of permission to collect the

data. The questionnaire was left with the respondents and to be collected by the enumerators within three days.

Instrumentation

The following instruments were employed to measure the study variables.


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1. HRM practices: Based on the interpretation of the Quranic verses related to HRM, a specially constructedquestionnaire was developed in order to gather the data. The instrument consisted of 54 items seeking information

about the organisations background and HRM practices among these selected organisations. Specifically, there were

four questions enquiring of the organisation background, the name of the organisation, the number of employees

employed, and the type of organisations ownership. There were ten items each asking about the recruitment,

selection, performance appraisal, training and development, and compensation practices. For each of these functions,

the respondents were asked to indicate the extent to which each of the activities in the questionnaire are beingpracticed in their organisations by using the seven-point Likert scales (1 = never, 2 = very rarely, 3 = rarely, 4 =

occasionally, 5 = frequently, 6 = very frequently, 7 = all the time).

2.Distributive Justice: The Distributive Justice Index developed by Price and Mueller (1986) was adopted to measurethe perception of distributive justice construct. The five-item scale measures the degree to which rewards received

by the employees are perceived to be related to performance inputs. Each item asks for the degree to which the

respondents believe that he or she is fairly rewarded on the basis of some comparison with responsibilities, education

and training, effort, stresses and strains of the job, as well as performance.

3. Procedural Justice: Perception of procedural justice was measured by a 15-item scale developed by Niehoff and

Moorman (1993). The items measure the degree to which the decision-making process ensure accurate and unbiased

gathering of information, institution of employees voice and appeal process, consistency, accuracy, correctability,

representativeness, and ethicality.

4.Interactional Justice: Interactional justice was measured by a seven-item scale developed by Niehoff and Moorman

(1993). The items measure the degree to which concerns for employees rights are shown by the management in

decision making, and that employees are given adequate justification and explanation pertaining to the outcome of

any decision.

5. Job Satisfaction: A 14-item scale based on Hackman and Oldhams (1975) Job Diagnostic Survey was used to

measure job satisfaction. The scale measures five facets of job, namely, job security, pay, social, supervisory, and

growth satisfaction.

6. Turnover Intention: This variable is operationally defined as thinking of quitting intent to search for a new job, and

intent to quit (Hom & Griffeth, 1991). The three-item scale used in this study to measure this outcome variable is

taken from the Michigan Organisational Assessment Questionnaire (Cammann et al., 1979). Responses were

solicited on a 7-point scale (1 = strongly disagree; 7 = strongly agree). Before the actual data collection was

conducted, a pilot test was done for the instrument and the results are displayed in Table 1.

Table 1. Pilot test for HRM Variables (N=30)

Variables for HR Practices Reliability Coefficient

Recruitment 0.787

Selection 0.919Performance Appraisal 0.826

Training & Development 0.913

Compensation 0.830

HRM: Quran-based 0.951

Distributive Justice 0.941

Procedural Justice 0.984

Interactional Justice 0.881

Job Satisfaction 0.918

Turnover Intention 0.849

Data AnalysisOnce the actual data was obtained, every negative-stated item was recoded. Reliability test was then conducted on

the 50 items for internal consistency purposes. The reliability coefficient for all 50 items was 0.951. Next, another

reliability test was conducted for the 10 items in each of the five HRM functions. If they are reliable, then factor

analysis would be conducted for each of these five functions. If the factor analysis produced more than two factors,

then the most reliable factor between them will be selected for next analysis in measuring the HRM practices.

As detailed example: For recruitment there were 10 items asking how the organisation recruits new employees.

The reliability coefficient for recruitment was 0.787. Since this result is reliable, factor analysis was then performed forall these 10 items. The analysis produced one factor and it was reliable thus the factor was selected. Next, the same

process was repeated for selection practices. The reliability coefficient for the 10 items in selection practices was 0.919.

The factor analysis produced one factor and since it was reliable, all the 10 items were used for the next analysis. For


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performance appraisal, the factor analysis produced three factors, and factor 1 was chosen because it has the mostloaded items and it was most reliable compared to Factor 2 and Factor 3. Factor 1 consisted of seven items. A

reliability analysis was done on these seven items and it shows reliability coefficient values of 0.890. Meanwhile,

factor analysis conducted for training and development function produced two factors, and Factor 1 was selected as it

was more reliable than Factor 2. Its reliability coefficient was 0.891. For compensation function, the factor analysis

produced three factors. Factor 2 which comprised of four items was selected as it was the most reliable factor among

the three factors with coefficient value of 0.855. The details of the items for each factor which were finalized and usedof the measurement for the study are shown in Table 2.

The instruments used to measure other studied variables such as distributive justice, procedural justice,

interactional justice, job satisfaction, and turnover intention were established scales and highly reliable; thus all theitems were maintained in their original form and a confirmatory factor analysis was done for each of these instruments.

The results are shown in Table 3, and Table 4.

Table 2. Factor Analysis and Reliability for HRM Practices Variables

Factor Loaded Item Items

1 RECRUIT1 My organisation ensures the manager who is in charged of recruitment is a good

Muslim, pious and just.

.477

RECRUIT2 My organisation informs the candidate about the job requirement and details. .177

RECRUIT3 My organisation assesses the candidate competency and interest. .398

RECRUIT4 To what extent does your organisation inform the candidates about the salary they

will receive?

.383

RECRUIT5 To what extent does your organisation reveal the necessary information about thejob and your organisation to the candidates? .447

RECRUIT6 To what extent does your organisation give equal opportunity to everyone to

apply for a vacant post in your organisation?

.704

RECRUIT7 To what extent does your organisation practice Islamic approach in recruiting the

potential candidates?

.775

RECRUIT8 To what extent does your organisation recruit candidates who are competent and

honest?

.827

RECRUIT9 To what extent do you recruit candidates responsibly and do it with full of amanah. .807

RECRUIT10 To what extent does your organisation practice Islamic approach in recruitment? .733

Eigenvalues 3.730

% Variance 37.305

Reliability .787

2 SELECT1 My organisation hires only qualified and competent candidates. .604SELECT2 My organisation uses Islamic factor in the criteria. .835

SELECT3 My organisation considers Islamic understanding is an important criterion in

selecting the candidates

.837

SELECT4 My organisation will reject the qualified candidates if it is proven the candidates

are not a good Muslim

.579

SELECT5 My organisation feels an Islamic practice such as prayers and fasting by the

candidates is very important.

.877

SELECT6 My organisation believes a good Muslim will be a good employee. .769

SELECT7 My organisation considers trustworthy is an important criterion for an employee

in this organisation.

.784

SELECT8 My organisation interviewing Muslim candidates will include questions pertainingto Islamic understanding.

.873

SELECT9 The selection decision in this organisation is done by the committee. .834SELECT10 My organisation conducts a test on candidates Islamic understanding during the

selection process.

.739

Eigenvalues 6.075

% Variance 60.749Reliability .919

3 PERFOR1 My organisation measures the employees performance regularly. .530

PERFOR2 My organisation practices a fair performance assessment for all employees. .553

PERFOR4 My organisation does not practice any favouritism in evaluating employees

performance.

.615

PERFOR5 My organisation reward employees based on their performance. .688


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PERFOR6 My organisation believes in justice and fairness in assessing employees performance. .716PERFOR7 My organisation practice Islamic approach in appraising employees. .829

PERFOR8 The appraisal is done by superiors and clients. .832

Eigenvalues 4.860% Variance 48.600

Reliability .890

4 TRAIN1 My organisation emphasizes on improving ones performance. .524

TRAIN2 My organisation conducts Islamic training programs for employees regularly. .695

TRAIN3 My organisation encourages employees to seek knowledge. .825

TRAIN4 My organisation conduct training regularly in this organisation .926TRAIN5 This organisation promotes training seriously .850

Eigenvalues 5.749

% Variance 57.488

Reliability .891

5 COMPEN8 It is employers responsibility to pay the employees salary on time. .860

COMPEN9 Cheating will be punished in this organisation. .818

COMPEN10 My organisation is aware of Islamic requirement in paying the salary to

employees.

.862

Eigenvalues 4.277

% Variance 42.773

Reliability .855

Table 3. Factor Analysis and Reliability for Organisational Justice


Distributive Justice DJ1 My superior has fairly rewarded me when I consider the responsibilities I have 0.854

DJ2 My superior has fairly rewarded me when I take into account the amount of

education and training that I have

0.854

DJ3 My superior has fairly rewarded me when I consider the amount of effort that I

have put forth

0.887

DJ4 My superior has fairly rewarded me when I consider the stresses and strains of

my job

0.824

DJ5 My superior has fairly rewarded me when I consider the work that I have done well 0.859

DJ6 Job decisions are made by my superior in an unbiased manner 0.724DJ7 My superior makes sure that all employee concerns are heard before job

decisions are made

0.752

DJ8 To make job decisions, my superior collects accurate and complete information 0.773

DJ9 My superior clarifies decisions and provides additional information when

requested by employees

0.804


Reliability 0.935

Procedural Justice PJ1 All job decisions are applied consistently across all affected employees 0.804

PJ2 Employees are allowed to challenge or appeal job decisions made by my superior 0.845

PJ3 When decisions are made about my job, my superior treats me with kindnessand consideration

0.917

PJ4 When decisions are made about my job, my superior treats me with respect and

dignity

0.918

PJ5 When decisions are made about my job, my superior is sensitive to mypersonal needs

0.833

PJ6 When decisions are made about my job, my superior deals with me in atruthful manner

0.883

PJ7 When decisions are made about my job, my superior shows concern for my

rights as an employee

0.868

PJ8 Concerning decisions about my job, my superior discusses the implications of

the decisions with me

0.879

My superior offers adequate justification for decisions made about my job 0.8655PJ9 When making decisions about my job, my superior offers explanations that

make sense to me

0.767


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PJ10 My superior explains very clearly any decision made about my job 0.873Eigenvalues 8.142

% Variance 74.021

Reliability 0.964Interactional Justice IJ1 I usually know how satisfied my superior is with what I do 0.796

My superior understands my job problems and needs 0.707

My superior recognizes my potential 0.713

Regardless of how much formal authority my superior has built into his/her

position, he/she would use his/her power to help me solve problems in my work

0.820

Regardless of the amount of formal authority my superior has, my superiorwould bail me out at his/her expense

0.706

I would defend and justify my superior's decision if he/she were not present to

do so

0.751

I have an effective working relationship with my superior 0.853

Eigenvalues 4.191

% Variance 59.874

Reliability 0.886

FINDINGS

Organisation Background

A total of eight organisations participated in this study. These organisations have their branch offices located atvarious locations in Malaysia. The size of the branches are from medium to large with staff strength ranging from less

than 100 employees to more than 400 employees. There were 88 employees working in 100 percent Muslim-owned

organisations, and the other 33 employees working in majority Muslim-owned organisations. The respondents were

obtained from their various branches. The distribution of respondents from each organisation is displayed in Table 5

Table 4. Factor Analysis and Reliability for Job Satisfaction & Turnover Intention


Job Satisfaction JS1 The amount of job security I have 0.726

JS2 The amount of pay and fringe benefits I receive 0.636

JS3 The amount of personal growth and development I get in doing my job 0.712

JS4 The people I talk to and work with on my job 0.582JS5 The degree of respect and fair treatment I receive from my superior 0.728

JS6 The feeling of worthwhile accomplishment I get from doing my job 0.766JS7 The chance to get to know other people while on the job 0.770

JS8 The amount of support and guidance I receive from my superior 0.658

JS9 The degree to which I am fairly paid for what I contribute to this organization 0.611

JS10 The amount of independent thought and action I can exercise in my job 0.670JS11 How secure things look for me in the future in this organization 0.784

JS12 The chance to help other people while at work 0.676

JS13 The amount of challenge in my job 0.690

JS14 The overall quality of the supervision I receive in my work 0.705


Reliability 0.914

Turnover Intention TT1 I often think about quitting 0.831

TT2 It is very likely that I will actively look for a new job in the next year 0.931TT3 I will leave this organization in the next year 0.914


Reliability 0.871


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Table 5. Distribution of Respondents (N=121)

Organisation Identification: Frequency Percent

Organisation1 20 16.5






Organisation7 12 9.9Organisation8 11 9.1

Type of ownership:

100% Muslim-owned 88 72.7

Majority Muslim-owned 33 27.3

Number of employees:

< than 100 employees 1 .8

101-200 employees 17 14.0

201-300 employees 23 19.0

301-400 employees 8 6.6

>than 400 employees 72 59.5

Table 6. Mean Scores for Islamic HRM Function

Item N Minimum Maximum Mean Standard DeviationRECRUIT 121 3.00 6.80 4.914 .741

SELECT 121 2.40 7.00 5.237 1.159

PA 121 3.00 7.00 4.782 .990

T&D 121 2.20 7.00 5.198 1.097

COMPEN 121 2.33 7.00 5.614 1.165

HRM Quran-based 121 3.26 6.91 5.149 .836

(1 = never, 2 = very rarely, 3 = rarely, 4 = occasionally, 5 = frequently, 6 = very frequently, 7 = all the time).

Islamic HRM Practices

Based on the factor analysis conducted, the items within each of the factors were computed as a total score. This isto examine the extent to which Islamic HRM is practiced in the selected Islamic organisations. The respondents were

asked to indicate to what extent each of the activities in the questionnaire was being practiced in their organisations byusing a seven-point Likert scales (1 = never, 2 = very rarely, 3 = rarely, 4 = occasionally, 5 = frequently, 6 = very

frequently, 7 = all the time). Table 6 shows that the organisations in which the respondents work; frequently practice

Islamic approach in all the HRM functions. The mean scores for all of the HRM functions were above 5.00 except for

recruitment and performance appraisal functions. Compensation function has the highest mean score of 5.614. Thetotal mean score for Quran-based HRM practices (recruitment, selection, performance appraisal, training and

development, and compensation) is 5.149. This shows that Quran-based HRM are frequently practiced at these selected

Islamic organisations. Table 7 depicts the mean scores for the three facets of organisational justice, job satisfaction and

turnover intention. The results inTable 8 display the mean scores for all the studied variables for each organisation.

Organisation 6 exhibits the highest mean scores for Quran-based HRM practices, interactional justice, job satisfaction,

and lowest mean score for turnover intention.

Table 7. Mean Scores for Organizational Justice, Job Satisfaction, Turnover Intention

Variable N Minimum Maximum Mean Standard DeviationDistributive justice 121 1.00 7.00 4.969 1.184

Procedural justice 121 1.91 7.00 4.945 1.068

Interactional justice 121 2.86 7.00 5.184 0.915

Job satisfaction 121 3.29 6.86 5.262 0.873

Turnover intention 121 1.00 7.00 3.074 1.717

Valid N 121

(Notes: 1 = strongly disagree; 7 = strongly agree).


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Table 8. Mean Scores for All Variables by Organisation

HRM

Quran-based

Distributive

Justice

Procedural

Justice

Interacional

Justice

Job

Satisfaction

Turnover

Intention

Organisation1 5.237 5.067 4.889 5.214 4.992 3.593

Organisation2 5.105 4.440 4.364 4.914 5.029 3.533

Organisation3 5.506 5.493 5.315 5.524 5.476 2.244

Organisation4 4.958 5.643 5.584 5.663 5.275 4.381

Organisation5 5.221 4.985 4.510 5.110 5.209 3.026

Organisation6 5.628 5.111 5.394 5.444 5.587 1.833Organisation7 5.302 4.600 5.190 5.182 5.234 2.091

Organisation8 3.932 4.367 4.364 4.298 5.369 3.861

(Notes: Scales for HRM Quran-based: 1 = never, 2 = very rarely, 3 = rarely, 4 = occasionally, 5 = frequently, 6 = very

frequently, 7 = all the time). (Notes: Scales for distributive, procedural, and interactional justice, job satisfaction &

turnover intention: 1 = strongly disagree; 7 = strongly agree).

Predicting for Organisational Justice, Job Satisfaction, and Turnover Intention

In order to examine the relationships and conclude the hypotheses of the study, a correlation analysis was

performed. The results in Table 9 support all the research hypotheses and the relationships are statistically significant,

except for the turnover intention variable. The Quran-based HRM practices are positively related to distributive justice

(r = 0.372, p


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although it is expected that these organisations would have practiced the Islamic approach even more frequently. Thisis because these organisations are Islamic organisations, owned and managed by the Muslims. They employ Muslim

employees, and they deal with Islamic products and services. It is revealed also that the three facets of organisational

justice and job satisfaction were highly and significantly correlated with HRM practices. This result is consistent with

previous studies (Yousef, 1999; Yousef, 2001), where in those studies it was found that the Islamic work ethics are

significantly correlated to organisational commitment and job satisfaction.

This finding has important implications to human resource managers. Managing human resources in Islamicapproach does influence the employees perception toward organisational justice and job satisfaction. In particular,

more attention should be given to selection, performance appraisal and compensation because these activities are

always subjected to injustice as perceived by the employees. An introduction to Quran-based human resource practicesis an initial attempt to provide managers with another effective way of managing people. For Muslim human resource

managers, it is requirements for them to not only know but also apply the Islamic approach in managing employees.

The knowledge of Quran-based HRM would be useful to even non-Muslim managers. Non-Muslim managers will have

a better understanding of their Muslim employees behaviour at the workplace. For instance, the findings that

procedural and distributive justice correlated to job satisfaction and Quran-based HRM would benefit those managers.

In order to enhance the level of job satisfaction, efforts should be directed to first improve level of organisational justice

and support of the Quran-based HRM practices.

In a multi-religion country like Malaysia, it is not easy for all Muslim human resource managers to practice the

Islamic approach, especially if the organisation is not owned by Muslims. As a start, the Quran-based HRM should be

practiced by the Islamic organisations. It is an obligation for Muslim businessmen who own the organisations to put

into practice the Islamic approach of managing its people and work activities. If Muslim themselves do not practice the

Islamic approach in managing their organisations, they cannot expect others to practice the Islamic approach. What

more nowadays, Muslim employees represent a significant percentage of the total workforce in Malaysia. Thus, an

Islamic approach is timely. Furthermore, as revealed in this study, the Quran-based HRM influences the organisational

justice perception among the employees. Muslim human resource managers should make all efforts to understand about

the Islamic approach in managing human resources and how they are unique from the Western human resource

management practices.

The findings and conclusions of this study are only suggestive and should be interpreted while keeping in mind the

following limitations. First, the generalisability of the findings of the present study might be questionable due to the

limited size of the sample. As shown in Table 5, there are less than 20 respondents in each organisation who

participated as respondents in this study. The organisations however are not of equal size. Some of the organisations

employ more than 300 employees. The quota sampling procedure probably could be employed for future research.

This leads to the second limitation of the study, the non-response bias. There is possibility of different response from

the non-response with respect to the variables in question. For future research, it would be meaningful to explore the

effects of Quran-based HRM practices on other work outcomes, such as employees performance, job stress and ethical

behaviours. It would be worthwhile to conduct a comparison study on HRM practices between the Islamic

organisations and non-Islamic organisations, and examine the effects of both on organisational factors such as justice

and commitment.

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