The threat of electronic performance monitoring: Exploring the role of leader-member exchange on employee privacy invasion

Advances in digitalization have led employers to increasingly adopt electronic performance monitoring technologies that allow supervisors to observe, analyze and evaluate not only employees' work activities, but also their cognitive and behavioral data. This has significant implications for employees' perceptions of privacy, and, in turn, for their basic needs, intrinsic motivation, and turnover intentions. However, the extent of perceiving privacy invasion may also depend on the relationship with those individuals for whom information is shared. This relationship should play a pivotal role in defining and negotiating boundaries and establishing comfort levels in information sharing. Building on communication privacy management theory and self-determination theory, we examined in three studies (two experiments and one field study) how the relationship with the supervisor (LMX) shapes the associations between (a) supervisor's use of EPM, its perceived invasiveness, and privacy invasion (Study 1, 2, 3), and (b) privacy invasion and needs, intrinsic motivation, and turnover intentions (Study 3). Specifically, we theorized that a high LMX that builds on trust should mitigate privacy invasion from invasive electronic performance monitoring. In addition, we hypothesized that high LMX can help employees cope with privacy invasion and consequently reduce need thwarting, decreased intrinsic motivation, and turnover intention. While we found some support for the role of LMX in the emergence of privacy invasion from invasive EPM, our data did not reveal that a high LMX reduces need thwarting and related outcomes due to perceived privacy invasion. This research provides timely insights with a multimethod approach into if and how the social context shapes unintended consequences from using electronic monitoring. • LMX shapes the relation between electronic performance monitoring and privacy, affecting basic needs and turnover intention. • But we found no evidence that a high LMX helps employees cope with privacy invasion, failing to mitigate need thwarting. • Our studies demonstrate that supervisors can play a role in helping employees navigate monitored work environments.