This is a study on employees’ perception of justice towards performance-based pay and
the effect of these perceptions on their turnover intention. This study aims to examine
the mediating role played by distributive and procedural justice in linking pay distribution
and pay procedure of performance-based pay to employees’ turnover intention. A
review of past literature in this particular area has prompted the researchers to narrow
the gaps in previous studies. Towards that, this study utilized questionnaires which
were administered among 50 non-managerial employees currently working in a private
company located in Kuching, Sarawak, East Malaysia. Data analysis was done using
Statistical Package for Social Sciences (SPSS), Version 20.0. Pearson Correlation and
Stepwise Regression were used to examine the relationship between the variables. The
outcomes of Stepwise Regression revealed that distributive justice fully mediated the
relationship between pay distribution and employees’ turnover intention in contrast to
procedural justice which did not have a significant impact in the relationship. The findings
of this study are useful references for organisation management of the pay system
to improve employees’ performance.