Whom to punish? Examining observers’ reactions to customer mistreatment by hospitality employees

Purpose This study aims to explore how witnessing a hospitality employee mistreating a customer impacts observers’ revenge-seeking behavior, directed not only at the offending employee but also at innocent employees. Design/methodology/approach This study conducts four online experiments to test the proposed relationships involving 881 UK adults. Findings Observing hospitality employees mistreating customers prompts observers to view the guilty employee as harmful, triggering revenge-seeking behavior. This perception of harmfulness also extends to innocent employees, leading observers to seek revenge against them. However, empowering fellow customers during the recovery process reduces observers’ intent to seek revenge against both guilty and innocent employees. In addition, the results reveal the black sheep effect, where shared group membership between the observing customer and the guilty employee results in harsher punishment for the latter, particularly when the mistreatment targets an out-group customer. Practical implications The findings offer practical guidance for hospitality companies on how observers’ perceptions of employees can reshape service evaluations and influence restorative approaches. Service recovery efforts should extend beyond directly affected customers to include those who witnessed the incident. Originality/value To the best of the authors’ knowledge, this is the first study to explain how observers appraise the mistreatment of fellow customers and how this influences their perceptions and revenge-seeking behavior toward both guilty and innocent employees.