The Mediating Role of Psychological Safety in the Association Between Inclusive Leadership and Employee Engagement in the Virtual Context

Abstract

As “Non-essential” employees were transitioned to home-office work following governmental infection control policies, a new context emerged in which leadership and work is performed. Researchers have put forward skepticism related to the effectiveness and feasibility of psychological safety and employee engagement in the virtual context. In this paper, it is argued that inclusive leadership behaviors will circumvent the skepticism and mitigate employee perception of psychological safety and employee engagement for remote interactions. This study utilizes a cross-sectional research design (n =182) using three measures respective to the constructs. Analysis was performed using targeted survey data from U.S. (60%) and Norwegian (40%) respondents, assessing the indirect, direct, and total effects between inclusive leadership, psychological safety, and employee engagement by use of structural equation modelling. Results from the analysis revealed that in the virtual context, the direct association between inclusive leadership and employee engagement was nonsignificant. Moreover, inclusive leadership had a positive direct association with psychological safety, which in turn had a direct positive association with employee engagement. Finally, the association between inclusive leadership and employee engagement was fully mediated by psychological safety. Based on this study, psychological safety was found to be effective in engendering employee engagement and significant in the virtual context. In practical terms, the results indicate that organizations communicating via information technologies should be aware of their effects on both leaders and employees.