LAUSR

Although a number of studies have focused on the mediating relationship between HR systems and performance at both a firm-level analysis and a cross-level analysis, only a few have examined the importance of employees’ perception in implementing HR systems. Using a massive database that included 6709 employees in 245 manufacturing firms in South Korea, this study examines the relationship between HR systems and two types of firm performance – financial performance and employee job satisfaction – through regression analyses and hierarchical linear modeling. In addition, the study investigates the mediating effect of the employees’ positive perception of HR systems. The results indicate that HR systems had an influence on the performance of firms and that the employees’ positive perception of HR systems had a mediating effect on the HR–performance relationship in both a firm-level and a cross-level analysis.