THE ROLE OF AFFECTIVE COMMITMENT AND ETHICAL LEADERSHIP IN PROCEDURAL FAIRNESS TO DETERMINE EMPLOYEE TURNOVER INTENTION

The considerable growth of Pakistani banking industry in recent decades has created opportunities for existing employees to switch jobs to banks that provide fair treatment and better opportunities. This has resulted in an inevitable situation of intraindustry competition to retain competent employees due to growing turnover trends, especially in Islamic banking. This study investigated the relationship between procedural justice and turnover intention. In addition, the mediating effect of affective commitment and moderating effect of ethical leadership have also been examined. The non-probability based purposive sampling technique was used on a sample size of 457 employees from two top Islamic banks situated in the capital territory of Islamabad, Pakistan. Data were gathered through a personal administered survey and statistically analyzed using Structural Equation Modelling (SEM) technique with SmartPLS software tool. Findings revealed that procedural justice have negative significant relationship with turnover intention and positively associated with affective commitment. Moreover, high level of perceived ethical leadership has strengthened the effect of procedural justice to increase employee's affective commitment. These findings empirically contributed to the existing procedural justice, affective commitment and turnover intention literature by examining moderating effect of Islamic work ethics. It provided valuable insights for the management of Islamic banks to employ operational plans such as developing code of conduct based on Islamic beliefs and practices, promotional, and motivational programs to retain its existing competent employees