Stakeholder harm index: A framework to review work intensification from the critical HRM perspective

Human Resource Management Review xxx (2014) xxx–xxx

HUMRES-00481; No of Pages 17

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Human Resource Management Review

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Stakeholder harm index: A framework to review workintensification from the critical HRM perspective

Sugumar Mariappanadar ⁎School of Business (Melbourne), Australian Catholic University, 250 Victoria Parade, East Melbourne 3002, Australia

a r t i c l e i n f o

⁎ Tel.: +61 3 9953 3108; fax: +61 3 9953 3775.E-mail address: [email protected]

http://dx.doi.org/10.1016/j.hrmr.2014.03.0091053-4822/© 2014 Elsevier Inc. All rights reserved.

Please cite this article as:Mariappanadar, S.HRM perspective, Human Resource Manage

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This multiple disciplinary research attempts to theoretically develop a stakeholder harm indexto capture and catalogue psychological, social and work related health aspects of harm ofhigh performance work practices (HPWPs) on stakeholders (employees, their families andthe community) from the negative externality perspective. An understanding of the harmof HPWPs will facilitate the role of sustainable HRM in improving the ethics of care forthe stakeholders while achieving organizational financial performance. The usefulness of thestakeholder harm index in capturing the harm of an HPWP is illustrated using a review ofthe critical HRM literature on work intensification. Results from the literature review reveal thatthe stakeholder harm index provides an important framework for capturing the comprehensiveharm and the associated social costs of work intensification based on welfare loss for thestakeholders. Empirical and practical implications to capture the harm and the associated socialcosts of harm are discussed.
© 2014 Elsevier Inc. All rights reserved.

Keywords:Sustainable HRMHarm of high performance work practicesStakeholder harm indexNegative externality of HRMSocial costs of HRM

1. Introduction

Strategic human resource management (HRM) advocates that organizational performance is enhanced by high-performancework practices (Delery & Shaw, 2001; Huselid, 1995). The simultaneous effects of high-performance work practices (HPWPs) onemployees and organizational outcomes are explained by the mutual gains perspective (Appelbaum, Bailey, Berg, & Kalleberg,2000; Guest, 1997)) and the conflicting outcomes perspective (Legge, 1995; Van de Voorde, Paauwe, & Van Veldhoven, 2012). Themutual gains perspective suggests employees (e.g., employee wellbeing) and employers (e.g., organizational performance) areboth benefiting from HPWPs. However, the conflicting outcomes perspective (e.g. Legge, 1995; Ramsay, Scholarios, & Harley,2000) views employers as the actors that benefit most in terms of organizational performance from HPWPs, and that HPWPs arenot beneficial or could even be harmful for employees in terms of their wellbeing. Furthermore, all HPWPs are not intrinsicallyharmful but some HPWPs are harmful for employees either the way those HPWPs are implemented in an organization or over useof such practices by managers. A third perspective regarding the simultaneous effects of HPWS has emerged in the literature assustainable HRM (Ehnert, 2009; Kramar, 2013; Mariappanadar, 2003). This third perspective adds value to the two earlier twoperspectives by suggesting that HPWPs are most likely to cause harm to employees (in terms of personal, social and healthwellbeing) while maximizing organizational performances but attempts can be made at the institutional level to minimize thisharm on employees. For example, Godard (2001a) indicated in his study on alternative work practices associated with HPWPsthat a higher level of adaptation to such work practices leads to more stressful work. Hence, an institutional level intervention isrequired to minimize such harm created by HPWPs, and that is the focus of sustainable HRM.

Sustainable HRM practices are those HR systems or bundles that enhance both profit maximization for the organization andalso ‘reduce the harm’ on employees, their families and communities (Mariappanadar, 2003; Wagner, 2013). Sustainable HRM

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highlights the synthesis paradox (Clegg, Vieira Da Cunha, & Pina e Cunha, 2002) where organizations can maximize their profitsusing strategic HRM practices as well as reduce the harm of HRM practices on the stakeholders because these two polarities arenot mutually exclusive but are rather, mutually reinforcing.

Research on the harm of work practices is not new, researchers (e.g., Kivimaki et al., 2006; Rugulies et al., 2012; Van de Voordeet al., 2012) within the critical and pessimistic perspectives of HPWPs have indicated the harm of work practices. However, theharm of work practices indicated in the sustainable HRM definition is about the profound negative impact on employees and theirfamily members for “reduced” psychological, social and work related health wellbeing outcomes that are caused by the workpractices used by organizations to extract maximum skills, abilities and motivation of employees to achieve highly effective andefficient performance. The harm of work practices highlighted in the sustainable HRM is based on the negative externalityperspective, which reflects the cost shifting to the stakeholders of the management of the harm of HRM practices. The negativeexternality of HRM practices (Ehnert & Harry, 2012; Kramar, 2013; Mariappanadar, 2012a) is the social cost of welfare lossimposed by HPWPs on the stakeholders (e.g., employees, their family members and communities) for ‘reduced’ psychological,social and work related health wellbeing outcomes. The harm of HRM practices based on negative externality is different from theskeptical and the pessimistic views of HPWPs (Peccei, 2004 cited in Van de Voorde et al., 2012) and the conflicting outcomeperspective literature (e.g. Legge, 1995; Ramsay et al., 2000) in two ways. The first difference is based on the welfare loss causedby the harm indicators of HRM practices such as ‘reduced’ psychological, social and work related health wellbeing outcomes forthe stakeholders. The second difference is about cost shifting to the stakeholders for managing the harm caused by HRM practices,which is understood based on the social costs of welfare loss for the stakeholders.

It is rare in the skeptical and pessimistic views of HPWPs literature to explore the harmful aspects of such work practices fromthe negative externality perspective. Hence, it will be useful to capture wide range of harmful aspects of HPWPs that ‘reduces’ thepsychological, social and work related health outcomes for the stakeholders in an index so as to recognize the aggregate socialcosts for the stakeholders to manage the harm imposed by HPWPs. This article aims to address the gap by developing an index tocapture the harm imposed on the stakeholders by HPWPs and the associated social costs for stakeholders to manage such harmbased on the negative externality perspective. An index to capture the harm and the associated social costs of harm of HPWPs forthe stakeholders will help organizations document and identify the harm so as to develop sustainable work practices to minimizethe harm and reduce social costs, which is one of the main tenants of sustainable HRM.

The aim of the article is achieved by exploring initially the theoretical basis for developing the proposed stakeholder harmindex so as to capture the harm and the associated social costs of harmful aspects of HPWPs. Subsequently, a review of publishedarticles on the harmful effects of work intensification, as a HPWP, is used to illustrate the usefulness of the stakeholder harm indexin capturing the psychological, social and work related health harm and the associated costs of harm of work intensification.

There are several advantages in developing a stakeholder harm index for HPWPs. Firstly, a framework to understand the sideeffects or the social costs of HPWPs is essential for developing sustainable HRM practices because an understanding of theaggregate costs of harm of HPWPs captured in the stakeholder harm index can help managers to revisit those practices to improvethe ethics of care for stakeholders and minimize the harm caused. In addition, it provides an evaluation of the effectiveness ofsustainable HRM initiatives introduced by companies in minimizing the harm on the stakeholders so as to ‘reduce cost shifting’ tostakeholders while maximizing organizational performance outcomes. This will value add to institutional theories suggesting thatgovernment, labor relations and labor advocacy groups have an important role in addressing the social costs of production(Godard, 1998, 2001b; Kapp, 1976). Secondly, an attempt to facilitate knowledge construction on the harm of HPWPs on thestakeholders as well as related social costs is important to enrich our understanding of the paradoxes, tensions, and conflictsassociated with using sustainable HRM as an emerging new trend in HRM. Finally, an attempt to understand the harm of HPWPs isnot ‘anti HRM’ or a negative view but it can be considered as a ‘positive’ HRM intervention so as to develop strategies to minimizesuch harm of HPWPs.

2. Background

2.1. Sustainable HRM

Sustainable HRM is an evolving field within HRM, and in the past decade the literature in sustainable HRM suggests the focus onshareholders and stakeholders outcomes is diverse and piecemeal (Kramar, 2013). In the literature, terms such as HR sustainability(Gollan, 2000), sustainable HRM (Mariappanadar, 2003), sustainablemanagement of HR (Ehnert, 2009), and sustainable work systems(Docherty, Forslin, (Rami) Shani, & Kira, 2002) are used to link sustainability to HRM practices.

The sustainable HRM focus extends beyond strategic HRM, suggesting HRM practices should be designed to furtherorganizational consideration of stakeholders' wellbeing outcomes while still achieving financial outcomes for the organization.Sustainable HRM is different from the mutual gains perspective of triple-bottom line approach (Elkington, 1997), because thefocus of sustainable HRM is built on the ‘synthesis paradox’ perspective of HRM (Mariappanadar, 2013b) where organizationsmust achieve financial outcomes using HPWPs with minimal harm imposed on the stakeholders (employees, their families andcommunities) so that the future use of HR capabilities is not compromised. This synthesis paradox perspective of sustainable HRMis shaped by holistic corporate sustainability (Van Marrewijk, 2003), the ethics of care for stakeholders (Greenwood, 2002), thenegative externality (Mariappanadar, 2012b) and the need for corporate survival to long-term business success (Wilkinson, Hill,& Gollan, 2001).

Please cite this article as:Mariappanadar, S., Stakeholder harm index: A framework to reviewwork intensification from the criticalHRM perspective, Human Resource Management Review (2014), http://dx.doi.org/10.1016/j.hrmr.2014.03.009


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Recently, Kramar (2013) clustered the diverse sustainable HRM literature into three groups. The capability reproduction groupingof sustainable HRM literature highlights the conservation of HR capabilities required by organizations to operate effectively indynamic environments (Ehnert, 2009). Furthermore, this grouping also suggests that HRM practices should achieve organizationaleconomic outcomes as well as positive human and social outcomes through sustainable change processes (Docherty et al., 2002;Ehnert, 2006). The second grouping, “connections” draws out the relationships between environmental management and HRM(Dunphy, Griffiths, & Benn, 2007; Jabbour & Santos, 2008; Kramar, 2012). Finally, within the broad focus of promoting social andhealth grouping, writers describe the negative externality of HRM practices on stakeholders (Mariappanadar, 2012b) such asemployee health, employee's family and community wellbeing, and explain the related social costs for employees, their families, andgovernments tomanage the harm. The primary focus of this article is to develop an index to capture the aggregate social costs of harmof HPWPs using the negative externality of HRM theory within the cluster of promoting the social and health grouping of sustainableHRM literature proposed by Kramar (2013). The findings of this research will have secondary value to literature within thecapabilities reproduction cluster to facilitate organizational focus on the change process to reduce the harm of HPWPs on employeesand their family members so as to conserve future HR capabilities. In the next section, negative externality of HRM practices isdiscussed.

2.2. Negative externality of HRM practices

Papandreou has provided a standard definition of externality, “as being present when the actions of one agent directly affectthe environment of another agent, i.e. the effect is not transmitted through prices” (1994, p. 5). That is, externality is somethingthat, while it does not monetarily affect the company that produces goods, does harm the living standard of society as a whole.Therefore, the negative externality is something that costs the organization nothing for their actions or business practices, butthose actions or business practices impose psychological and social aspects of harm on third parties (stakeholders) such asemployees, their families and communities (Kramar, 2013; Mariappanadar, 2012b).

Negative externality of HRM practices is based on a social costs theory of externality. Kapp (1976) indicated that the socialcosts are imposed on the weaker section of the society, such as individuals, who cannot defend themselves from the harm ofeconomic activities and cost shifting. Godard (2001b) highlighted that in liberal market economies, attempts to promote HPWPs as ameans to enhancing “equity” for employees and “efficiency” for employers are misguided within the current institutional context.HPWPs as ‘best’ practices may not be the ‘best’ for employees because they depend on the institutional conditions (e.g., unioninfluence) underwhich they are adopted. If limited union influence exists in the current institutional context then the harmofHPWPsmay be imposed on the stakeholders without the employer being aware of it because employers tend to believe that HPWPs areconsidered the best practices and they have mutual benefits for employees and employers. Furthermore, Kapp suggested that thepublic and private sectors,with the combination of public and private controls,make it necessary to define social costs as the damagesand harmful effects of public and private economic decision making (1965). Hence, the social costs theory of externality forms anappropriate rationale for discussing negative externality to understand the harm of HPWPs on stakeholders as third parties. Forexample, organizations use HPWPs to internalize the costs benefits of all their actions with respect to maximizing employeeproductivity but disregard the harm such practices have onwellbeing outcomes (Van de Voorde et al., 2012), andwelfare loss for thestakeholders.

The skeptical and the pessimistic views deal with the harmful aspects of HPWPs on employees, for example high work stress(Godard, 2001a), work intensification (Ramsay et al., 2000), cross-over and spillover effects of HPWPs on employees' familymembers (e.g., Westman, Etzion, & Danon, 2001; Westman & Etzion, 1995) and on employees' health (e.g., Lee, Colditz, Berkman,& Kawachi, 2004; Van de Voorde et al., 2012). However, the harm or negative effect of work practices in sustainable HRMhighlights the attempts to ‘reduce’ the personal, social and work related health outcomes that are caused by HPWPs. Thesereduced outcomes lead to ‘welfare loss’ for the stakeholders (employees, their family and the community) as calculated by thenegative externality or social costs of harm of HPWPs.

3. Theoretical basis of stakeholder harm index of HPWP

The stakeholder harm index of HPWPs is defined as a catalogue to capture the harmful aspects of reduced psychological, social andwork related health wellbeing outcomes for the stakeholders (employees, their families, and the community) and the aggregate social costsof welfare loss due to such harmful aspects caused by either a specific form of HPWP or a bundle of HPWPs. The stakeholder harm indexdefinition is proposed based on a heuristic argument of micro-economic theory to indicate the ‘welfare loss’ to employees, theirfamilies and communities caused by the harm indicators that are triggered by HPWPs. Black, Hashimzade, andMyles (2009) definedwelfare as the state ofwellbeing of an individual or a society. The level ofwelfaremeasures the degree of contentment of an individualor a society. For an individual, this is represented by a utility function and for a society by a social welfare function. Therefore, welfareloss is a situation where marginal social benefit is not equal to marginal social cost and society does not achieve maximum utility(Khanna, 2000). The harmof HPWPs is understood based onwelfare loss causedby the harmful aspects ofHPWPs. That is, the harmfuleffects of HPWPsrestrict the stakeholders (employees and their family) from maximizing the utility function of paid work forimproved individual psychological, social and health wellbeing or good for a society.

For example, an instrumental use of process based employee motivation to extract the maximum level of effort from employeesmay be unethical because of the potential harm it can have on employees and their families due to increasedwork stress (Michaelson,2005). Hence, the work related health and social harms of work stress due to the unethical use of process based employeemotivation




on employees and their families are considered as the harm of such an HPWP. This type of harm of an HPWPmay restrict employeesfrom being involved in leisure activities or voluntary work for the community or from improving family relationships. Hence, it is awelfare loss for employees as well as for their family members because both parties are not able to maximize the utility function ofpaid and unpaid work (e.g. harmonious family relationships and increased leisure activities) and may not contribute to the society(e.g. voluntary work for the community) due to work related psychological and health issues.

In the environmental science literature there are many indices available to measure welfare loss due to the health impacts ofpollution, such as computable general equilibrium (Nam, Selin, Reilly, & Paltsev, 2010), and an index of welfare losses associatedwith damages from exposure to pollution (Khanna, 2000). However, there is currently no index available as of now to capture thewelfare loss due to the harm of HPWPs. The stakeholder harm index is developed based on the understanding derived fromKhanna's index on measuring the cost of welfare loss due to human health issues caused by air and other pollutions. Therefore,the theoretical rationale for developing the stakeholder harm index is drawn from multiple disciplines such as health care,psychology, sociology, HRM and social economics.

The welfare loss for the stakeholders is the basis to calculate the negative externality or social costs of harm of HPWPs. The costmeasure to understand the negative externality or social costs of HPWPs is relatively new in the critical HRM literature. Recently,Mariappanadar (2013a) has proposed a framework for the cost measure of harm of HRM practices. The framework for the costmeasure of harm of HRM practices forms the theoretical basis for developing a structure of the proposed stakeholder harm index.According to the framework, the psychological, social and work related health harm indicator domains are used as cost measuresof harm of HRM practices to capture and evaluate the costs of harm. Furthermore, welfare “loss” is used as the cost measure ofharm instead of welfare “improvement” or “benefits” of some status of psychological, social and healthy functioning by employeesand their family members (p. 107). The reason for using welfare loss in HRM as the cost measure of the psychological, social andhealth harm because these harms ‘impair’ or ‘refrain’ employees' and their family members' from achieving benefits or effectiveutility function of paid and unpaid work for improving wellbeing outcomes. Subsequently, the social cost of welfare loss caused bythe measure of harm for the stakeholders is calculated by using direct and indirect costs, lost productivity and reviews ofpolicymakers' overall perceptions of costs. Finally, the social costs of the welfare loss for the psychological, social and work relatedhealth measures of harm are assigned to individual, family and community stakeholders respectively.

The labels of the stakeholder harm index structure (Table 1), columns (C1 to C4) and rows (R1–R3) are based on the frameworkfor the cost measures of harm of HRM practices. The structure of the index is explained using contents which are drawn from theextant literature. Firstly, columns (C2 to C4) in the stakeholder harm index (Table 1) represent the cost measure domains for thepsychological (C2), social (C3) and work related health aspects of harm (C4). Secondly, the cost measure domains include harmindicators (C2a, C3a and C4a) and social costs or welfare loss caused by the harm indicators (C2b, C3b and C4b). For example, assuggested byMariappanadar (2012a) and Ehnert andHarry (2012) the type of harm indicators (C2a) such aswork related exhaustionand burnout highlight reduced future personal outcomes of paid work or welfare loss for employees and their family membersand are aggregated into the cost measure for the psychological domain of harm (C2). Similarly, neglect of spouse/partner,children, elderly parents and divorce are the harm indicators of the spill-over and crossover effects of work–family conflictexperienced by employees and their family members (C3a) which are clustered into the cost measure for the social domain ofharm of work practices (C3).

Insomnia, depression and coronary heart disease are the harm indicators (C4a) clustered into the cost measure for the workrelated health domain of harm (C4). The aspect of harm indicators of work related health issues that employees and their familymembers experience as stakeholders can be explained by two different theoretical pathways: the physiological recoverymechanism and life style factors (Van der Hulst, 2003). These two pathways are not mutually exclusive and they may operatesimultaneously. The physiological recovery mechanism proposes that insufficient recovery after demanding work disturbsphysiological processes (blood pressure, hormone excretion, sympathetic nervous system activity) and leads to physical healthcomplaints (Rissler, 1977). Unhealthy life-style factors such as smoking and caffeine and alcohol consumption, an unhealthy diet,and lack of exercise can all cause physiological changes (e.g., high blood pressure, high cholesterol) and lead to an increased riskfor cardiovascular disease and adverse health in general (Van der Hulst, 2003).

Thirdly, to evaluate the social costs of welfare loss of the harm imposed by HPWPs on the stakeholders, it is important totheoretically link the harm indicators to welfare losses caused by the reduced future personal, social and work related healthoutcomes for the stakeholders. Therefore, the columns (C2b, C3b, and C4c) are used to record the direct/indirect social costs ofwelfare loss caused by each harm indicator. These three processes will help managers and researchers to catalogue and reveal thetypes of harm of HPWPs along with the social costs or welfare loss.

Finally, rows (R1–R3) within column-C1 help to capture the social costs of the harm of HPWPs for employees, their familymembers and the government/society as stakeholders. There are two reasons for assigning the social costs of harm to individualstakeholders instead of combining it for multiple stakeholders (e.g., employee and their family members, employee and workrelated health and employees' family members and health). Firstly, according to the negative externality of HRM practicesdiscussed earlier in the background section of this article, the social costs of welfare loss of the harm caused by the independent,spill-over and crossover effects of the harm of HPWPs are imposed on individual stakeholders (employees, their families and thecommunity) to manage the harm. Hence, the calculated social costs of welfare loss for the stakeholders to manage the harm ofHPWPs have to be assigned to each stakeholder according to the relevance of the harm imposed on the stakeholders and that isdepicted in R1 to R3.

Secondly, the crossover effect of harm of work practices on employee's family members is dependent on the social support andpersonality characteristics of the family member. For example, Morrison and Clements (1997) used the negative affectivity, a



Table 1A stakeholder index of harm of high performance work practices.

Cost measures of harm of high performance work practices (HPWPs)

Costs attributed torelevant stakeholder (C1)

The cost measure for psychological aspect of harm (C2) The cost measure for social aspect of harm (C3) The cost measure for work related health aspect of harm (C4)

Type of harm indicators (C2a) Direct/indirect social costs (C2b) Type of harm indicators(C3a)

Direct/indirect social costs (C3b) Type of harm indicators (C4a) Direct/indirect social costs (C4b)

Employees—R1 Work related exhaustionand burnout

Employees change theircareer path due to burnoutand hence earn 85% lessincome at the timeretirement comparedto the former career

Pre-occupation withwork related problems

Cost of loss of intimacy,companionship, and sharedrecreational time in thefamily leading to maritaldissatisfaction

Insomnia caused by highjob demands

It costs per employee $ 136(€100) for absenteeismassociated with insomniaapart from the performanceimpairment (e.g., irritability,fatigue).

Employees' familymembers—R2

Restrictions in spouses'leisure activities due todepressed employees

The social costs for spouses'reduced leisure activities

Increased conflictbetween partnersleading to divorce

Direct average costs of$ 30,000 for each spousein the affected relationship

Negative work experiencesof male partners are linkedwith greater alcohol abuse,anxiety, physical symptomsand medication use amongtheir spouses

Social costs for the affectedemployees' family to manageassociated problems linked tonegative work experiences ofemployees.

Society/government)—R3 Employed alcohol abusehaving detrimental effecton affected employees'work capabilities

Transitional unemploymentand increased cost of welfarepayments for the government

Increased conflictbetween partnersleading to divorce

Direct and indirect costs tothe government $30,821per divorce

Work related coronaryheart disease (CHD)

Annual per capita directhealth care costs of $839for individuals with CHD.

Crossover effect ofemployees' work harmof HPWPs on their spouses'depression

Annual per capita healthand disability costs of $5415to the society for caring affectedindividuals with depression.

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stable tendency to experience negative emotions across time and situations, of both spouses as a control variable in work–familyconflict crossover research. They found that the female's negative affectivity as a personality characteristic was a significantpredictor of female partners' reported wellbeing across physical health and depression. Hence, in reality employees may beaffected in some instances by the harm but the crossover effect on their family members is moderated by the family members'personality characteristics.

According to these two reasons, R1 will be used to capture the spill-over effect of the psychological, social and work relatedhealth harm of HPWPs on employees as stakeholders. R2 will be able to capture the crossover effect of the psychological, socialand work related health harm of HPWPs on employees' family members as a stakeholder. The primary objective of R3 is tocapture the externality or social costs imposed on the society/government for the psychological, social and work related healthharm of HPWPs experienced by both employees and their family members. Although R1 to R3 of the stakeholder harm indexcaptures externality or social costs of work related harm for individual stakeholders, it has the capability to capture the socialcosts of harm imposed on multiple stakeholders simultaneously or time delayed by analysing the costs column wise. This isexplained next along with the stakeholder harm index.

The stakeholder harm index (Table 1) is explained using multiple HPWPs drawn from the extant HPWPs literature of thecritical HRM perspective. The row-R1 highlights the social costs of the psychological, social and work related health harm ofHPWPs imposed on employees as stakeholders. Kroon, Van de Voorde, and van Veldhoven (2009) found support for the criticalHR perspective in their study where high performance work practices (HPWPs) intensified job demands for employees, whichlead to increased exhaustion and burnout. Furthermore, Beckers et al. (2008) found that employees who experienced highburnout showed a higher inclination to change careers. Those employees who made the decision to change careers because ofthe psychological harm of HPWPs (e.g. exhaustion and burnout) earned 85% less income at the time of retirement comparedto their former career. Therefore, the cells—R1 C2a and R1 C2b highlight the prevalence of the psychological harm of HPWPs onemployees and the associated social costs for them. The cells—R1 C3a and R1 C3b indicate the social harm of HPWPs and theassociated social costs for the affected employees. For example, HPWPs increase employees' pre-occupation with work relatedproblems and that subsequently leads to loss of intimacy, companionship, and shared recreational time in the family (Piotrowski,1979). Hence, there is a social cost for those affected employees when the social harm of HPWPs is responsible for employees'marriage dissatisfaction and increased conflict between couples. The cells—R1 C4a and R1 C4b indicate the social cost for employeesrelating to absenteeism caused by insomnia due to high job demands of HPWPs (Godet-Cayre et al., 2006). Therefore, the cells—R1 C2,R1 C3 and R1 C4, facilitate managers and researchers to capture the aggregate social costs of the psychological, social, work relatedhealth harm of HPWPs for employees, as a stakeholder.

Similarly, the cells of row-R2 capture the social costs for employees' family members due to the crossover effect of thepsychological, social and health harm from employees' negative work experiences. For example, the cells—R2 C2a, and R2 C2bhighlight the social cost of the psychological harm experienced by employees' family members', such as restriction in leisureactivities for family members' due to the crossover effect of employees' work related depression. Furthermore, the high jobdemand of HPWPs on employees leads to increased conflict between partners (the social harm—R2 C3a, and R2 C3b) and finally theincreased conflict leads to the end of their relationship in a divorce, which costs each spouse an average direct cost of $30,000(Schramm, 2006). In response to the crossover effect of employees' negative work experiences, the avoidant coping (cells—R2 C4a,and R2 C4b) used by employees' family members such as alcohol abuse, increased anxiety, physical symptoms and medication use(Moos & Billings, 1982) indicate the social costs of health harm imposed on employees' family members. Hence, the cells of row-R2indicate the psychological, social and health harm and their associated costs for employees' familymembers as a stakeholder becauseof the crossover effect of employees' negative experiences with HPWPs.

Finally, the cells of R3 indicate the social costs for the society/government as a stakeholder for the psychological, social andwork related health harm of HPWPs experienced by employees and their family members. For example, Jones, Caswell, and Zhang(1995) revealed that high workloads and longer shift work are some of the antecedents for heavy drinking among employees.Subsequently, they found that employees with heavy drinking habits are more likely to become unemployed because of increasedabsenteeism and lowered productivity due to their heavy alcohol consumption (Table 1). The society/government as a stakeholderhas to bear the increased disability claimsmade by individuals affected by burnout related unemployment (cell—R3 C2b). The cells R3C3a and R3 C3b indicate that increased conflict between partners leads to divorce and it is identified as the social harm of HPWPs. Itcosts the US government $30,821 per divorce (Schramm, 2006) apart from the associated costs for the spouses.

The cell—R3 C4a highlights the work related health harm on employees and their family members. There is clear evidence in thereview that work related heart disease, high cholesterol, depression and high blood pressure are caused by HPWPs andmoderated byinadequate physiological recovery and life style factors of employees and their family members. The long latency period betweensome distant risk factors and manifest coronary heart disease and the fact that coronary heart disease is a multi-etiological diseasemake it difficult to distinguish between single causal risk factors and risk markers (Galobardes, Smith, & Lynch, 2005). However, it isshown in Table 3 that a meta-analysis of prospective cohort studies onwork stress and coronary heart disease found that work strainis associated with about a fifty percent excess risk of coronary heart disease (Kivimaki et al., 2006) when studied alongside otherfactors such as blood pressure, cholesterol, body mass index, organizational injustice etc.

Also, Kivimaki et al. (2006) revealed that for employees with a stable job strain over a period of time an estimated time laggedstrain and its negative effect on coronary health disease could be accurately determined. Furthermore, it is shown in Table 3 that aSwedish study showed that a combination of stressful conditions at work and at home predicted coronary heart disease symptomsamong women, whereas, for men, symptoms were more strongly determined by work stress alone (Krantz, Berntsson, & Lundberg,2005). Therefore, it can be suggested from the data shown in Table 3 that the time lagged attribute of harm of HPWPs may enhance



Table 2An illustration of work intensification externalities using the stakeholder harm index.

Cost measures of harm of work intensification as high performance work practices (HPWPs)

Costs attributed tosingle or multiplestakeholders (C1)

The cost measure for psychological aspect of harm (C2) The cost measure for social aspect of harm (C3) The cost measure for work related health aspect of harm (C4)

Type of harm indicators (C2a) Direct/indirect costs (C2b) Type of harm indicators (C3a) Direct/indirect costs (C3b) Type of harm indicators (C4a) Direct/indirect costs (C4b)

Employees—R1 Problems thinkingclearly and decisionmaking at work dueto work intensification

Costs $15,000 or morefor employees due tolongitudinal relativedeprivation of promotionopportunities

Sleep disturbances duehigh work demands

Cost of long term negative effecton employees due to excessivesmoking, drinking coffee andalcohol to cope with high workdemands

Employees' familymembers—R2

Studies have consistentlyshown that work relatedmusculoskeletalconditions of employeescreate stress on marriagesand on the healthy spouses

The social costs to theaffected spouse for asignificant reductionin the rate of remarriageafter divorce in individualswith musculoskeletalconditions

Crossover of work–familyconflict

Employees' spouses pay forthe welfare loss caused bywork–family conflict relateddepression

Society/government)—R3 Insomnia caused by highjob demands and multipledeadlines to meet

Total direct average costs forgovernment to care an affectedindividual with insomnia is $916

Work related burnout anddepression for employees

Annual per capita health anddisability costs of $5,415 tothe society for caring affectedindividuals with depression

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the risk of coronary heart disease among employees and their family members. The cell R3 C4a also shows the crossover effect ofemployees' harm of HPWPs on employees' family members' health. For example, a longitudinal study found that husbands'work-to-family conflict was significantly related to wives' depression (Hammer, Cullen, Neal, Sinclair, & Shafiro, 2005).

The cell—R3 C4b indicates the social costs imposed by HPWPs on the society as a third party, where the government providesuniversal health care for its citizens, as shown in Table 1. It is estimated that it costs the government $394 billion to treat coronaryheart disease, and that healthcare expenditure accounted for 61% of the costs. On a per capita basis, $839 was devoted to coronaryheart disease related healthcare (Leal, Luengo-Fernández, Gray, Petersen, & Rayner, 2006). The estimate of coronary heart diseaserelated healthcare costs include employee burnout caused by the psychological, social and work related health harmful aspects ofHPWPs along with other causal reasons. Furthermore, the review of the cost of depression indicated that treatment for depressionincurred annual per capita health and disability costs of $5415 for the government, which is significantly more than the costs forheart disease, diabetes and back problems (Druss, Rosenheck, & Sledge, 2000).

The index also has the capability to capture multiple layered social costs of harm of HPWPs for stakeholders due to thecrossover effect of harm from the employee level to their family level and subsequently to the society level. For example, workrelated insomnia imposes social costs on employees (costs relating to performance impairment) then crossover to the familymembers (caring for employees affected by insomnia) and finally the society bears the costs for treating both the affectedemployees and their family members. Similarly, divorce caused by marriage dissatisfaction triggered by the high work demandsof HPWPs costs the employee, their family and the society. Therefore, the stakeholder harm index has the capability to captureand reveal to practitioners and researchers the harm and the associated costs of those harmful aspects of HPWPs on individualstakeholders as well as the simultaneous costs imposed on multiple stakeholders.

In summary, the stakeholder harm index is a useful tool to capture the aggregate social costs for the psychological, social andhealth harm of HPWS on individual stakeholders (employees, their family members and the society/government) and also thecosts to multiple stakeholders. Nevertheless, the social costs of work related harm of work practices based on the review shouldbe considered with some caution because there is no clear evidence in the literature to attribute the externality of HPWPs iscaused by the policies and practices of HPWPs or the operationalization of such policies and practices by managers. However, theagency theory of organization (Rhoades & Eisenberger, 2002) indicates that employees perceive that their managers representthe organization they work for and hence the managers' actions (good or poor) when implementing policies are perceived as thatof the organization. Hence, employees tend to perceive a poor implementation of good policy and practice by managers as a poorpolicy and practice of the organization. Therefore, the stated limitation of not having evidence from the review that the harms arecaused by policies and practices or poor implementation of those policies and practices has very little adverse impact on thefindings of the harm of HPWPs.

In the next section, the usefulness of the stakeholder harm index in capturing the harmof oneof theHPWPs is explored. To achievethis aim, work intensification and its associated social costs imposed on the stakeholders is explored using the review of critical HRMliterature which is provided in Table 3. This attempt to capture the associated social costs of harm of work intensification imposed onthe stakeholderswill enhancepractitioners' and researchers' understanding of the index so as to use this index in future to capture theharm of other HPWPs.

4. Social costs analysis of harm of a HPWP—an illustration

In this section the usefulness of the stakeholder harm index in cataloguing the harm and the associated social costs of harm ofHPWPs is illustrated using a social costs analysis of harm of work intensification (Table 2). The reason for choosing workintensification for illustration purposes is because it is one of the most common harms of HPWPs discussed in the critical HRMliterature. The analysis is conducted based on the review of critical HRM literature on the harm indicators of work intensificationprovided in Table 3. Work intensification (Allan, 1998; Godard, 2001a; Ramsay et al., 2000), a form of HPWP adjustment thatintensifies the workloads of employees, can be used to improve employees' performances as well as profit for organizations, butcan also negatively affect employees' physical, mental and social wellbeing (Ogbonna & Harris, 2004). According to Boselie,Dietz, and Boon (2006) definition of strategic HRM, work intensification is a work practice operationalized by HRM systems tomanage employee activities such as improved workloads and involuntary overtime work etc., for improving organizationalactivities.

4.1. Method

A review of published articles on employee promotability, employee career growth, employee burnout, depression, anxiety,cardiovascular disease, work family conflict, and divorce is used to categorize the identified published articles according to theharm indicators and their relevance to the cost measure of psychological, social and work related health harm of HPWPs. Relevantarticles were identified through computer searches. Computerized searches were conducted through PsycLIT and OVID databasesusing keywords such aswork–family conflict, work related problems in clear thinking and decisionmaking, work related illnesses,monetary evaluation of illnesses and occupational illnesses. Subsequently, additional computerized searches were conductedthrough the same databases using combinations of keywords such aswork intensification and the different harm indicators aswellas HPWPs and the different harm indicators.




4.2. Selection

The initial search resulted in 1801 titles and abstracts published in English relating towork–family conflict, work related problemsin clear thinking and decision making, work related illnesses and occupational illnesses and costs related to these variables.Subsequently, an additional 208 articles were identified using HPWPs and work intensification. A review of articles based on the costmeasure of harm domains (Mariappanadar, 2013a) reduced this number to 98 articles. The final selection resulted in a total of 37eligible publications (see Table 3) assessed for inclusion based on the quality of publications criteria. The five criteria are: type of study(review, cross-sectional, longitudinal, self-report, medical reports or physical examinations), study population (working age andemployees), assessment of harm indicators such as psychological, social and health outcomes caused by work demand, involuntaryovertime work (examples for work intensification), and monetary valuation of illnesses. Furthermore, the selection criteria fordisease should be work-related as defined by Weever, van der Beek, Anema, van der Wal, and van Mechelen (2005). They definedwork related illnesses as multi-factorial diseases among a working population which are partly caused by work, and/or exacerbatedby work practices, and/or the cause of impaired work capacity. Finally, the publication needed to be a full text article written in theEnglish language.

4.3. Results of the review

The results of the review of the psychological, social and work related harm of work intensification on employees, their familymembers and the society/government as stakeholders are shown in Table 2. The reviewed articles provided in Table 3 were used toinfer the harmful aspects of work intensification by using organizational stressors such as elevated workload, job insecurity, joboutsourcing, retrenchment, and strain (burnout, health and wellbeing). In the occupational health literature, organizational stressors(cause for stress) and strains (response to stress) are differentiated (Spector & Jex, 1998) to understand the reduced psychological,social and health outcomes for the stakeholders. Therefore, the negative impacts of work stressors and strains on the stakeholders areextrapolated in this article as the harm indicators of work intensification, because research on the harm of work intensification fromthe negative externality perspective is still in the early stages. Subsequently, the costmeasure of harmdomains ofwork intensificationis captured in the stakeholder harm index (Table 2). This attempt can help managers and researchers understand the harm or sideeffects of work intensification from the negative externality perspective, and it may trigger more research on the harm of otherHPWPs from this perspective and enrich the critical HRM literature.

4.3.1. Prevalence of the harm of work intensification on employeesTable 2 shows the two aspects of harm of work intensification that are identified for employees from the review are psychological

and work related health harm. Firstly, high workload causes problems in thinking clearly and decision making among skilledemployees based on the review (Albertsen, Rugulies, Garde, & Burr, 2010), and this is considered as the psychological harm of workintensification on employees as stakeholders. The social cost of welfare loss due to the psychological harm of work intensification isabout actual or proxy price for lost opportunities or welfare loss for improved future personal outcomes (e.g. promotion, careergrowth, reward etc.) for employees.

For example, take an employee on an annual salary of $70,000 who was working efficiently and effectively in achieving the setperformance standards before the introduction of an increased workload in his/her current position. On the introduction of workintensification, this employee, may start exhibiting any of the psychological harm indicators, such as lack of concentration andproblems with clear thinking and decision making, burnout or alcohol abuse, and/or work performance may start to suffer. Thesupervisor of this employee may become frustrated or disappointed with the employee because he/she has not risen to thesupervisor's performance expectations and hence the supervisor may relatively deprive or disadvantage the employee's involvementin any future challenging job experiences. That is, the supervisor may develop a biased evaluation that those employees under his/hersupervisionwho exhibit a psychological aspect of harm (e.g. problems thinking clearly, lack of self-confidence due to job burnout etc.)subsequent to the introduction of work intensification practices have limited ‘personal’ capabilities to cope with work intensification.Hence, the supervisor may deprive those employees of the opportunities for challenging job experiences and subsequently evaluatethem less favorably for promotability (Greenhaus, Parasuraman, & Collins, 2001).

This relative deprivation of opportunities (Crosby, 1976; Pettigrew, 2002) for employeesmay occur due to the supervisor's biasedevaluation towards employees' ‘personal’ characteristics as the reason for the psychological harm instead of attributing workintensification as the ‘institutional’ level cause. This leads to welfare loss for victimized employees due to reduced future personaloutcomes as their chances for promotability or career growth may be marginalized. The longitudinal relative deprivation withnegative impact on the affected employee will cost future career promotions, which leads to lost earnings from the position higherthan his/her current position as well as the welfare loss of using that additional income in leisure activities to improve his/herwellbeing. Assuming that the annual salary of $85,000 for the promoted position is higher than the current one of $70,000, then theemployee has lost $15,000 annually in earnings as well as the welfare loss due to the lost additional income.

Secondly, in Table 2 sleep disturbances due to high work demands is shown as the work related health harm on employees basedon the unhealthy life-style factors. For example, Akerstedt et al. (2002), in their study on sleep disturbances andwork-related life stylefactors, found that smoking and drinkingmore than three cups of coffee a day was related tomore difficulties awakening (insomnia)for employed men. Difficulties awakening were also predicted by high work demands, low social support, and low age. Hence, thesocial costs for employees as stakeholders is the long term negative effect of cardiovascular disease due to excessive smoking anddrinking coffee to cope with high work demands (Woodward & Tunstall-Pedoe, 1999).



Table 3Reported quality criteria and details of chosen publications on harm indicators of work intensification.

Study (first author) Study type Study population and country The relationship between work harm exposure and harmindicators or health outcomes

Monetaryvaluationofillnesses

Articles relevant to the cost measure of psychological harm of work intensificationAlbertsen, Rugulies, Garde, and Burr (2010) Empirical Knowledge workers (Danish) Skilled employees with complex work tasks and with high demands to cognitive

performance tend to show cognitive symptoms, such as problems withconcentration, thinking clearly, and taking job related decisions, as goodindicators of work stress.

No

Beckers et al. (2008) Record based study 18–66 years (Dutch) Involuntary overtime work was associated with relatively high fatigueand burnout.

No

Jones, Caswell, and Zhang (1995) Empirical research Working population—18 to 65 years(New Zealand)

Employed heavy alcohol drinkers felt that their drinking haddetrimental effect on their work capabilities.

No

Maslach (2003) A book on burnout explainedwith case studies

Cases from the US The costs individual employees pay for burnout are loss of self-esteem,lack of self-confidence and self-worth.

No

Mirvis and Hall (1994) Theoretical study Not applicable Psychological costs and lost earnings of boundaryless career YesMullahy and Sindelar (1996) Record based study 25–59 years (US) Found that for both men and women, problem drinking results in

reduced employment opportunities and increased unemploymentNo

Articles relevant to the cost measure of social harm of work intensificationBakker, Demerouti, and Dollard (2008) Empirical study Couples of dual earner parents For both men and women, their own job demand has spill over as

well as crossover effect on work family conflict, which leads toexhaustion.

No

Beatty (1996) Empirical study Professional and managerial women(Canada)

The results revealed significant correlations between organizationalstressors, role overload and marital dissatisfaction.

No

Fadden, Bebbington, andKuipers (1987)

Empirical study Spouses of depressed patients Interviewed spouses of depressed patients regarding restrictions insocial and leisure activities, a fall in family income, and a strain on themarital relationship.

No

Frone, Barnes, and Farrell (1994) Empirical research Average age—42.9 years (US) Family/marital dissatisfaction was positively and directly related to thefrequency of heavy drinking.

No

Grant-Vallone and Donaldson (2001) Empirical study Non-professional employees (US) Work–family conflict had both immediate and longer term effects onfamily members' overall well-being.

No

Greenhaus (2001) Empirical study Professional accountants (US) It was found that work-to-family conflict (but not family-to-work conflict)was positively related to career withdrawal intentions.

No

Articles relevant to the cost measure of social harm of work intensification (continued)Leger and Bayon (2010) Review based study 15 years or older (multiple countries) Beside the patients themselves, their family and work relatives are also

probably deeply affected in their own lives by the consequences ofpoor sleep.

Yes

Matthews and Gump (2002) Register based empiricalstudy

35–57 years (USA) Work related life events and marital stress, and coronary heartdisease mortality

No

Moos and Billings (1982) Empirical study Matched spouse study Greater use of avoidant coping behaviours in response to a recentstressful event was associated with greater alcohol use, anxiety,depression, physical symptoms, and medication use among spouses

No

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Schramm (2006) Report based study Couples experiencing divorce (USA) Divorce and its direct and indirect economic consequences cost forindividuals, family and the society.

Yes

Seljamo et al. (2006) Longitudinal empirical study Married or cohabitating couples(Finland)

Fathers' heavy drinking is the best predictors of children's alcohol abuse. No

Sears and Galambos (1992) Longitudinal empirical study Employed dual-income sample Work stress leads to depression if it is managed properly over a longperiod of time

No

Thomas Ray, Mertens, andWeisner (2009)

3 year longitudinal empiricalstudy

Matched sample of familymembers with alcohol dependenceand diabetes and asthma.

Children of people with alcohol and drug dependences(AODD) experience distress due to the conflict betweentheir parents, and research has also found a strong link betweenAODD and child neglect.

Yes

Westman, Etzion, and Danon (2001) Empirical study Married working couples (Israel) Revealed three types of cross-over effect of burnout from husbandsto their partners caused by job insecurity.

No

Articles relevant to the cost measure of work related health harm of work intensificationAkerstedt et al. (2002) Cross-sectional study 19–65 years (Sweden) High work demand is a risk indicator of sleep disturbances NoBailey, Carleton, Vlaeyen, and Asmundson (2010) A review 35–51 years (not country specific) It is estimated an annual treatment cost of $ 100 billion for insomnia in

the US.Yes

Godet-Cayre et al. (2006) Empirical study Working population (France) The cost of absenteeism due to insomnia to the government, employersand employees.

Yes

Béjean and Sultan-Taïeb (2005) Record based study Working population (France) Cost evaluation of illnesses attributed to work stress. YesDruss, Rosenheck, and Sledge (2000) Health and employee

recordsbased study

Employees of a U.S. corporation The cost of depression to employers, particularly the cost in lost work days,is greater than the cost of many other common medical illnesses.

Yes

Kivimaki et al. (2006) Meta-analysis Employees (not specific to onecountry)

An average 50% excess risk for coronary heart disease is attributed towork stress.

No

Krantz, Berntsson, and Lundberg (2005) Questionnaire basedempiricalstudy

32–54 years (Sweden) Link between double exposure (work and family) and severe shoulderaches, and sleep disturbances.

No

Articles relevant to the cost measure of work related health harm of work intensification (continued)Leal, Luengo-Fernández, Gray, Petersen, andRayner (2006)

Record based study Age of the study population is notprovided (Europe)

Cardio vascular disease-related expenditure was estimated usingaggregate data on morbidity, mortality, and healthcare resource use.

Yes

Lee, Colditz, Berkman, and Kawachi (2004) Clinical records based study 46–71 years (USA) Job insecurity and coronary heart disease NoLeger and Bayon (2010) Review Working population (not specific to

one country)The average total direct costs for treating insomnia are $1039 Yes

Martin, Aikens, and Chervin (2004) Review Multiple populations Direct medical costs of insomnia in the US have been estimated to $13.9billion annually, and indirect costs have been estimated to range fromUS$77 to US$92 billion annually based on 1995 data.

Yes

Mathers, Vos, Stevenson, and Begg (2001) Record based study 18–65 years (Australia) Ischemic heart disease and stroke together causing nearly 18% of thetotal disease burden in Australia.

No

Punnett and Wegman (2004) The epidemiologic literatureon work-related musculo-skeletaldisorders

Working population (US) The review suggests that workplace exposure to biomechanical andpsychosocial factors (high job demands, work procedures andorganizational characteristics) as the epistemology of work relatedmusculoskeletal disorders.

No

Rugulies, Martin, Garde, Roger Persson, andAlbertsen (2012)

Two year longitudinal studybased on self report

Knowledge workers (Danish) Findings indicate that a part of the association between frequency ofdeadlines and reduced amount of sleep was mediated by long workinghours.

No

Stewart, Ricci, Chee, Morganstein, and Lipton(2003)

Empirical study Working adults—18–65 years (US) Lost productivity due to work related pain conditions (e.g., headache,arthritis and other musculoskeletal) expressed in hours in week andcalculated in dollar value.

Yes

Vahtera et al. (2004) Register based empiricalstudy

19–62 years (Finland) Downsizing and coronary heart disease based mortality. No

Yelin and Callahan (1995) Record based study Working population (US) The direct and indirect costs of musculoskeletal disorders. Yes

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4.3.2. Prevalence of the harm of work intensification on employees' family membersTable 2 indicates that the social and work related health aspects of harm of work intensification on employees' family members

are the two relevant harms based on the review. The review of articles provided in Table 3 indicate that the social aspect of harmindicators of work intensification reduce emotional and social outcomes for employees' family members which can be used toevaluate welfare loss for employees' families as stakeholders. The crossover effect of work-to-family is used to explain the impact ofthe social aspect of harm on reducing social wellbeing outcomes for employees' family members. It is evident from the literature(Westman et al., 2001) that there are different types of crossover impact on employees' family members. The direct crossover effecton employee family envisages that when an employee experiences the harm of HPWPs then his/her spouse also appears toexperience the same harm because as closely related partners, they care for each other and share a great deal of their lives together.Furthermore, the common crossover effect suggests that the harm of work intensification can be a common stressor and thus has acrossover effect in a shared environment increasing the strain on both partners' personal, social and health outcomes. For example,when employees suffer from poor sleep due to an increasedwork load (Leger & Bayon, 2010) and frequent deadlines (Akerstedt et al.,2002), this not only affects the employees but their families too (see Table 2).

In Table 2, it is shown that musculoskeletal conditions create stress on marriages and on the healthy spouses (Revenson, 1993),which subsequently leads to divorce. The social cost for the spouse of the affected employee is that there is a significant reduction inthe rate of remarriage after divorce in those individuals (Hawley, Wolfe, Cathey, & Roberts, 1991). Also, Bakker, Demerouti, andDollard (2008) revealed that for both men and women, job demands were positively related to their own reported work–familyconflict as well as levels of work–family conflict as reported by their partners. These findings show partner sensitivity to others'experience of work family conflict and therefore explain the common crossover effect. The crossover effect of work–family conflictresults in higher levels of depression for one's spouse (Hammer et al., 2005). Hence, work–family conflict is considered as the healthharm for employees' spouses, and employees' spouses pay for the welfare loss caused by work–family conflict related depression.

It is evident from the review that work intensification as a HPWP used by organizations to increase employee efficiency hasnegative crossover effects on social and health wellbeing outcomes for employees' families as stakeholders, as shown in Table 2, forwhich they as third parties bear the social costs of welfare losses. Therefore, the cross over effect of work–family conflict is animportant consideration in understanding the social and health harm of work intensification on employees' family members as astakeholder.

4.3.3. Prevalence of externality of work related health harm of work intensification on the society/governmentThe society as a stakeholder has to bear the social cost for the psychological, social and work related health harm of work

intensification experienced by employees and their family members. However, the results of the review found relevant informationonly on the negative externalitywork related health harm ofwork intensification on the society/government for employees and theirfamily members. The review provided in Table 3 indicates that insomnia (Akerstedt et al., 2002; Rugulies, Martin, Garde, RogerPersson, & Albertsen, 2012), musculoskeletal disorders (Bailey, Carleton, Vlaeyen, & Asmundson, 2010; Punnett & Wegman, 2004;Stewart, Ricci, Chee, Morganstein, & Lipton, 2003; Yelin & Callahan, 1995), coronary heart disease (Leal et al., 2006; Lee et al., 2004;Mathers, Vos, Stevenson, & Begg, 2001; Vahtera et al., 2004) and depression (Druss et al., 2000) are the most common health issuescaused by work intensification.

Table 2 indicates, with respect to insomnia caused by work intensification, that the average direct cost of $916 is incurred by theinsurance company, organized health care providers, and the society through universal health care insurance systems (Leger & Bayon,2010). Furthermore, in the US it was estimated annual direct medical costs of insomnia to be $13.9 billion, and indirect costs havebeen estimated to range from US$77 to US$92 billion based on 1995 data (Martin, Aikens, & Chervin, 2004).

According to the review of the cost of depression, it is indicated that employees treated for depression caused by work relatedburnout (e.g. high level harm) incurred annual per capita health and disability costs of $5415, significantly more than the costs forheart disease, diabetes and back problems (Druss et al., 2000). However, the social costs of work related health harm of workpractices should be considered with some caution because occupational health issues are based on multi-etiology and hence it isdifficult to distinguish between single and multiple causal risk factors.

5. Discussion and implications

5.1. Knowledge construction on stakeholder harm index of HPWPs

In the pessimistic view of HRM literature it is indicated that the harmful aspects of HPWPs on employees, for example highwork stress (Godard, 2001a), work intensification (Ramsay et al., 2000), have cross-over and spillover effects of HPWPs onemployees' family members (e.g., Westman et al., 2001; Westman & Etzion, 1995) and on employees' health (e.g., Lee et al., 2004;Van de Voorde et al., 2012). This research highlights the harm of HPWPs on employees and their family members. However, thereis a need to collate and catalogue all these harms in an index to understand the comprehensive harm of HPWPs on thestakeholders. The stakeholder harm index of HRM is based on the micro-economics theory of welfare loss and negativeexternality perspective to capture the psychological, social and work related health aspects of harm on the stakeholders. Thestakeholder harm index will be the first harm index available in the HRM literature to capture diverse harmful aspects of HPWPson the stakeholders (employees, their family and the community).

It is apparent that the stakeholder harm index can be used by practitioners and researchers as a tool to facilitate a comprehensiveunderstanding of diverse harm and the associated social costs of the harmful aspects of HPWPs so as to understand the level of care




provided for the stakeholders. Furthermore, it is a useful tool to capture and monitor the harm of HPWPs on the stakeholders over aperiod of time. However, in this article the data on harm of HPWPs are collated by extrapolating the findings fromwork stress studiesto understand the harm. Therefore, further research is required to measure and capture the harm, which refrains the stakeholdersfrom achieving positive wellbeing outcomes instead work stress based understanding of the harm.

The proposed stakeholder harm index of HPWPs sets a new agenda for more empirical and theoretical research to developknowledge construction for the field of sustainable HRM. In future there is a compelling need for more empirical and secondaryresearch to measure and document the social costs of the harm of work intensification using the theory of holistic corporatesustainability (Van Marrewijk, 2003), the ethics of care for stakeholders (Greenwood, 2002), negative externality (Mariappanadar,2012b) and the requirement for corporate survival to long-term business success (Wilkinson et al., 2001) to understand the actualharm it can imposeon the stakeholders (employees, their families, and the community). Furthermore, the harmofwork intensificationcan be studied in the future using both conservation of resource theory (Hobfoll, 2001) and cognitive appraisal theory (Lazarus, 2000)to understand the moderation effect on the harmful aspects of work intensification.

5.2. Multiple harms of work intensification on a single and multiple stakeholders

There are clear indications from the data captured in the stakeholder harm index, based on the review, that work intensificationused by organizations to maximize profit does cause harm to the stakeholders (employees, their family members and the society).There is also evidence from the review that the harm of work intensification was imposed not just on a single stakeholder likeemployees or their families but also simultaneously on multiple stakeholders such as employees and their family member's. Thestakeholder harm index provides a comprehensive understanding of the psychological, social andwork related health harm imposedby work intensification on single and multiple stakeholders. This was the first time it was attempted in the critical literature of HRM.In practice, the stakeholder harm index facilitates managers and researchers to understand the cross-sectional harm of HPWPs andchanges of harm over a period of time or cross-over effect of harm of work practices on employees, their family members and thecommunity.

It is evident from the review that there is need for more future research to explore the psychological, social and work relatedhealth harmofwork intensification on employees, their familymembers and the society as stakeholders from the negative externalityor social costs perspective. A few possible future research studies on the harm of work intensification on the stakeholders areproposed. Firstly, there is a compelling need to study the psychological harm and social costs of work intensification on all threestakeholders so as to gain a better understanding of sustainable HRMpractices. For example, an attempt could bemade to explore theextent to which work intensification leads to relative deprivation of employees' promotability by managers so as to reveal the socialcosts of work intensification on employees as stakeholders. Secondly,many studies have explored the spill-over effect of work–familyconflict on the social harm of work intensification on employees and their spouses/partners. Hence, future studies should explore thespill-over effect of work–family conflict on care giving to children and elderly parents so as to have a better understanding of thecomprehensive social costs of the social harm for employees' family members. Finally, research on work related harm haspredominantly attempted to reveal the cost of health harm of work intensification for the society or health insurance companies butfuture research should also focus on the social costs of health harm of work intensification for employees and their family members.

5.3. Aggregate social costs of harm of work intensification

The direct and indirect approaches of valuation of costs to employees and their familymembers (individual level) and communities(societal level) due to themeasures of the psychological, social andwork related health aspects of harmare considered to be relevant tocapture the social costs of harmofwork intensification in the stakeholder harm index. The analysis of the social costs of harmof HPWPscaptured in the stakeholder harm index can provide a comprehensive understanding of the aggregate social costs of the harm ofHPWPs, which is rarely attempted in the literature.

There is a clear trend of direct and indirect social costs imposed on employees and their family members (individual level) andcommunities (societal level) due to the measures of the psychological, social and work related health aspects of harm of workintensification based on the illustrated social analysis using the stakeholder harm index. However, the proponents of the mutualbenefit view of HPWPs will argue that the aggregate social costs of work intensification catalogued in the stakeholder harm index,as an example for HPWPs, is an exaggeration of the negative effect of work intensification. As the harm and associated social costsof work intensification is based on a review of multiple studies, the proponents may have some claim to their argument, but theharm and the associated costs of work intensification captured in the stakeholder harm cannot be ignored unless provenotherwise.

For example, if organizations attempt to internalize the social costs or pay for the costs of harm imposed on the stakeholders byHPWPs,which are used tomaximize profit, then the profitmargin achieved in this processmay not indicate the ‘true’ profit but ratherhighlight the risk for a negative margin. Does this mean that organizations cannot have higher profit margins by caring for theirstakeholders? Definitely it is possible for organizations to achieve higher profit margins even after caring for their stakeholders basedon the synthesis paradox of sustainable HRM (Mariappanadar, 2013b). That is, an awareness of the level of ethics of care forstakeholders based on the stakeholder harm index can subsequently encouragemanagers to introduce sustainable HRM strategies toenhance profitmargin for the organization by also reducing the harm of HPWPs on the stakeholders. Therefore, the synthesis paradoxof sustainable HRM adds value to the extant mutual gains and critical perspectives of simultaneous enhancing effects of HPWPs onstakeholders and organizational financial outcomes.




Hence, future research should focus on understanding the synthesis effect of work intensification in improving organizationalfinancial outcomes as well as reducing the harm on employees and their family members. For example, flexible work such as aResults Only Work Environment (Kelly, Moen, & Tranby, 2011; Moen, Kelly, & Lam, 2013), compressed work week (Brough &O’Driscoll, 2010; Lingard, Brown, Bradley, Bailey, & Townsend, 2007) and the open-rota system (Pryce, Albertsen, & Nielsen,2006) are reported in the literature as the institutional level change interventions which minimize the negative effect of workintensification. These are some of the work practices or change interventions in the pessimistic HRM literature that fit into thedefinition of sustainable HRM, where it is used to minimize the harm of work intensification. Future research should focus onlongitudinal research to understand the effect of these institutional level interventions in reducing the harm and social costs ofwork intensification on the stakeholders as well as enhance profits for the organization.

5.4. Sustainable HRM as a self-regulation system

The stakeholder harm index can facilitate sustainable HRM as a self-regulation system to manage the harm of work practices.Ashford and Tsui (1991) suggested self-regulation for managerial effectiveness which is based on the control theory framework(Carver & Scheier, 1981). According to this, the process of self-regulation for managerial effectiveness involves three subprocesses: standard setting, discrepancy detecting and discrepancy reducing for various stakeholders. Therefore, the stakeholderharm index can help managers identify and capture the harm of certain work practices so as to detect discrepancy in ethics of carefor the stakeholders so as to introduce HR policy and practice change interventions to minimize the harm. Subsequently, by usingthe index evaluate over a period of time, the effectiveness of any intervention in minimizing the harm of certain work practicesthat are imposed on the stakeholders can be determined as well as achieve financial performance for the company.

Sustainable HRM as a self-regulation intervention for social outcomes focuses on the institutional level, and it will facilitatemanagement-based regulation (Coglianese & Lazer, 2003) and social regulation (Gunningham & Rees, 1997; Hawkins & Hutter,1993). Docherty et al. (2002) indicated this in their sustainable work system for renewal and development of the organization'shuman and social capital based on the negative human and social outcomes for individual, organizational and societal level. Inmanagement-based regulatory strategies (Gunningham & Rees, 1997), firms are expected to produce plans that comply withgeneral criteria designed to promote the targeted social goals, such as the identification of hazards including harm of workpractices such as occupational health and safety, risk mitigating actions, procedures for monitoring and correcting problems, andmeasures for evaluating and refining the firm's management with respect to the stated social objectives. This management-basedregulation is implemented in areas of food safety, chemical accident avoidance, and pollution prevention. Hence, the stakeholderharm index as a tool will help extend the use of management-based regulations to HRM functions such as employee health andwellbeing, and social outcomes of HPWPs. The social self-regulation (Gunningham & Rees, 1997) is usually taken to includemechanisms whereby industry associations, in their undertaking of business activities, ensure that unacceptable consequences ofwork practices on stakeholders such as the environment, the workforce, or consumers and clients, are avoided.

The stakeholder harm indexwill facilitateHRpractitionerswith detailed knowledge of the industry inwhich firms are operating toidentify the harm of HPWPs and set standards formanagement-based regulation, social self-regulation and sustainablework systemsat the institutional level. This will arguably lead to more practicable standards for the negative consequences on the stakeholders aswell as be more effectively monitored. There is also the potential for utilizing peer firm pressure and for successfully internalizingresponsibility for compliancewhen social self-regulation is used. Because self-regulation contemplates ethical standards of conduct orcorporate social responsibilitywhich extend beyond the letter of the law, itmay significantly raise standards of firms' behaviorwithinan industry (Gunningham & Rees, 1997). The stakeholder harm index provides opportunities for future research to exploresustainable HRM as a self-regulation system by benchmarking the harm of HPWPs and subsequently identifying deviations from thestandard, and introducing appropriate institutional level interventions to minimize the harm. Alternatively, the government andlabor advocacy groups can use the benchmark on harm of HPWPs to encourage or reform industrial relations law suggested byGodard (1998) to take punitive actions on deviant companies within that industry.

SustainableHRMas an institutional level self-regulation systemhowever, should be consideredwith somecaution. Because the criticsbelieve that self-regulatory standards are usually weak, enforcement is ineffective and punishment is secret and mild. Moreover,self-regulation commonly lacks many of the virtues of conventional state regulation in terms of visibility, credibility, accountability,greater likelihood of rigorous standards being developed, and enforced for a range of sanctions' (Webb and Morrison, 1996).

In conclusion, the stakeholder harm index is a useful tool to capture and catalogue the harm and the aggregate social costs of theharm imposed on the single and multiple stakeholders by HPWPs practices of organizations. Furthermore, it is evident from thereview of the extant literature that work intensification as a product of HPWPs has the potential to cause the psychological, social andwork related health harm on the stakeholders. Hence, this article has made a small but an important step forward in knowledgeconstruction in the mutual benefit perspective of HPWPs based on the synthesis paradox perspective of sustainable HRM. It also,extends the critical HRM literature to understand the harm of HPWPs from the negative externality perspective. The stakeholderharm index can help organizations, labor advocacy groups, trade unions and public policy makers to measure and benchmark theharm of HPWPs so as to implement appropriate HR policy and practices change interventions as self-regulations for sustainable HRM.

5.5. Strengths and weaknesses of this review

This is the first known systematic review of studies on work stress and strain to extrapolate those findings to explain the harmof work intensification from the negative externality perspective. The search strategy was systematic using Cochrane standards




(Van Tulder, Furlan, Bomardier, & Bouter, 1997), with a broad scope of work related harm indicators as keywords, so there was onlya small chance that publicationsweremissed in the databases thatwere searched. However, because the searchwas limited to articlespublished in the English language and studies published in the journals of the selected databases, there are chances that publicationsin other languages, books, unpublished reports or manuscripts published in journals not included in the selected database could havebeen overlooked. Another limitation of this review concerns its small number of quality work stress articles that could be used toextrapolate and explain the harm of HPWPs because the research on negative externality of HPWPs is in the early stages ofinnovation. Furthermore, the social costs of welfare loss for the stakeholders found in the review were only indicative because inmany articles the costs were calculated based on published data and medical records. Finally, the focus of this review is on workintensification and hence it should be noted that other HPWPs such as constant electronicmonitoring of employees (e.g. call centres),discrimination and harassment, bullying can cause harm on the stakeholders but are not covered in this review.

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Stakeholder harm index: A framework to review work intensification from the critical HRM perspective