Original Research

Impact of labour conflicts on employee innovation: The role of proactive HRM

Abdellatif Bensouda, Hassan El Aissaoui, Asmae Ourdi

Received: 20 Nov. 2024; Accepted: 11 Feb. 2025; Published: 31 Mar. 2025

Copyright: © 2025. The Author(s). Licensee: AOSIS.
This is an Open Access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

Orientation: This study examines the impact of labour conflicts (LCs) on employee innovation, emphasising the role of proactive human resource management (HRM) strategies. Unmanaged LCs can hinder innovation by reducing employee engagement and motivation.

Research purpose: The study aims to analyse how LCs affect employee innovation and how proactive HRM practices can moderate these effects.

Motivation for the study: Given the significance of innovation for organisational competitiveness, limited research exists on how LCs intersect with HRM practices. This study addresses this gap within the Moroccan context.

Research approach/design and method: A quantitative approach using structural equation modelling (SEM) analysed data from 400 employees across various sectors, allowing a comprehensive assessment of the relationships between LCs, HRM practices, motivation and innovation.

Main findings: Findings reveal a significant negative relationship between LCs and innovation. However, proactive HRM strategies can mitigate this effect, with employee motivation and engagement serving as mediating factors.

Practical/managerial implications: The study provides insights for HR practitioners, highlighting the importance of proactive conflict resolution to minimise the adverse effects of LCs on innovation. Promoting employee engagement is essential for fostering an innovative environment.

Contribution/value-add: This study enriches HRM and innovation literature by demonstrating how proactive HRM strategies can transform LCs into opportunities for enhancing innovation.

Keywords: labour conflicts; proactive HRM; employee innovation; employee motivation; SEM.

Introduction

Innovation is a fundamental driver of organisational competitiveness and sustainability, enabling firms to adapt to the challenges of a rapidly evolving global economy. Employees play a pivotal role in this process, as their creativity and engagement contribute significantly to the development of innovative solutions. However, the relationship between workplace dynamics and innovation is often overlooked, particularly in environments marked by recurring conflicts. In Morocco, workplace conflicts remain a critical issue, with 56 509 conflicts reported in 2021, highlighting persistent challenges in professional relations (Ministry of Economic Inclusion, Small Business, Employment and Skills, 2022). These conflicts reflect deep-rooted structural tensions within the Moroccan labour market, which is characterised by evolving employment models, increasing contractual flexibility and sectoral disparities in labour relations. Morocco’s economic landscape is undergoing significant transformations across multiple sectors, including agriculture, industry, trade and services. In agriculture, for instance, climate change and shifting consumer preferences are reshaping production methods, impacting employment stability and altering traditional labour relations. Similarly, in the industrial sector, the acceleration of automation and digitalisation is transforming job structures, requiring continuous workforce adaptation and redefining employer–employee relationships. The service sector, particularly in retail and tourism, is facing pressures linked to global market integration, requiring businesses to navigate increasingly complex employment frameworks and labour negotiations.

These conflicts not only expose systemic tensions but also emphasise the urgent need for strategic interventions. Proactive human resource management (HRM) has emerged as an essential approach to addressing these challenges. By fostering preventive measures and promoting a supportive organisational climate, proactive HRM not only mitigates the adverse effects of workplace conflicts but also creates the conditions necessary for sustained innovation and organisational growth.

Orientation

Employee innovation is widely recognised as a critical driver of organisational competitiveness and sustainability, particularly in today’s dynamic and rapidly evolving economic environment (Hurley & Hult, 1998). An organisation’s capacity to innovate, adapt to change and sustain a competitive advantage is fundamentally reliant on the innovative contributions of its employees (Hamid, 2019). These individuals play an indispensable role in developing new products, services and processes, thereby enhancing organisational efficiency and fostering competitive differentiation – key factors for achieving long-term success.

However, this positive innovation dynamic can be significantly undermined by labour conflicts (LCs) (Kristensen, 2010). Such conflicts can disrupt creativity, hinder collaboration and create barriers to the free exchange of ideas, ultimately impeding an organisation’s overall performance (Troyer & Youngreen, 2009). Consequently, LCs pose a considerable threat to an organisation’s ability to maintain an innovation-friendly environment, making it essential to understand their impact on employee innovation.

Although the existing literature frequently addresses LCs and innovation as separate entities, a notable gap remains in research examining their specific interaction, particularly within the framework of proactive HRM practices. Addressing this gap is crucial for developing effective strategies that transform LCs from potential obstacles into catalysts for improvement and innovation. Proactive HRM practices can play a pivotal role in transforming these challenges into opportunities for fostering an environment conducive to innovation.

Research purpose and objectives

This study aims to enrich the current literature by providing a comprehensive empirical analysis of the impact of LCs on employee innovation, with a particular emphasis on the moderating role of proactive HRM strategies and the mediating role of employee motivation. Poorly managed LCs increase the risk of demotivation and disengagement among employees, which can lead to a decline in their productivity and their ability to effectively contribute to the organisational climate. An environment characterised by such tensions undermines individual fulfilment and professional development, both of which are essential for fostering creative and innovative contributions (Camacho Ramírez & Mayorga, 2017).

Proactive HRM refers to an approach that seeks to identify and resolve potential problems before they arise, integrating management practices that support organisational performance while cultivating a positive work environment (Meshoulam & Baird, 1987). In the Moroccan context, where LCs remain a significant concern, the role of proactive HRM becomes even more crucial. Moroccan enterprises operate within a dynamic regulatory and socio-economic framework, marked by evolving labour laws, sectoral disparities and structural shifts across key industries. These factors contribute to workplace tensions, making preventive HRM strategies essential for maintaining industrial stability and fostering an innovation-friendly work environment. These strategies are essential in mitigating the adverse effects of LCs, as they foster a climate of trust, collaboration and employee engagement.

This study contributes to the HRM and innovation literature by examining these dynamics within the Moroccan context, where LCs are shaped by socio-economic factors such as sectoral disparities and evolving labour laws.

The study seeks to identify how these HRM practices can effectively mitigate the adverse effects of LCs, thereby facilitating a more innovation-conducive environment within organisations. In a labour market characterised by increasing contractual flexibility and the diversification of employment models, Moroccan companies must adapt their HRM approaches to anticipate and prevent conflicts that could hinder workplace cohesion and innovation. Utilising a SEM approach, this study investigates the complex relationships between LCs, proactive HRM strategies, employee motivation and innovation. The intention is to demonstrate how organisations that implement proactive HRM strategies can significantly reduce the occurrence and impact of LCs, enabling an environment where innovative ideas can thrive. Moreover, the study seeks to highlight that organisations fostering collaborative work relationships are more likely to succeed in their research and development efforts, whereas those characterised by conflict are often hindered by mistrust and a lack of alignment between management and employees.

By addressing the central research question – How can proactive HRM practices moderate the impact of LCs on employee innovation? – this study contributes to both theoretical and practical understandings of HRM practices. In the Moroccan labour landscape, where employment relations are influenced by legal frameworks and social dialogue mechanisms, examining the role of proactive HRM provides valuable insights into the preventive measures that organisations can adopt to reduce workplace tensions. Following a rigorous methodological process, including a comprehensive theoretical review, the development of hypotheses and a detailed analysis of empirical findings, this study aims to offer practical insights and recommendations for HR managers, decision-makers and HR professionals. Ultimately, the findings are expected to provide actionable strategies for optimising LC management, enhancing employee motivation and cultivating an environment that fosters and sustains employee innovation.

Literature review

Labour conflicts can significantly impact a company’s ability to innovate and develop new products, services and processes. This literature review focuses on the dynamics between LCs and employee innovation, emphasising how proactive HRM strategies can transform challenges into opportunities for organisational improvement. By examining existing research, it provides a theoretical framework for understanding the mechanisms underpinning these relationships.

An LC refers to a state of disagreement between employers and employees, arising from issues such as wages, working conditions, job security or the right to unionise. According to the International Labour Organization (ILO), an LC encompasses ‘a disagreement between one or more workers and their employer concerning the violation of a right enshrined in law, a collective agreement, or an employment contract’ (ILO, 2014, p. 13). Numerous studies indicate that these conflicts can undermine a company’s ability to develop new products, services and processes by reducing collaboration, diminishing employee motivation and disrupting communication and knowledge sharing.

However, the literature suggests that proactive HRM strategies can play a crucial role in mitigating the negative impacts of LCs on innovation. By fostering a culture of open communication and collaborative problem-solving, these strategies can transform potential conflicts between employers and employees into opportunities for constructive dialogue and idea generation, thereby enhancing the organisation’s innovation performance. Moreover, organisations that prioritise collaborative work relationships tend to achieve better outcomes in research and development initiatives, which are critical for driving innovation. In contrast, in companies where relationships are marked by conflict, innovation efforts are often hampered by mistrust and a lack of alignment between management and employees (Hoxha & Kleinknecht, 2021). Finally, the data indicate that companies with cooperative labour relations are more likely to engage in continuous improvement and innovation efforts. These environments facilitate the gradual accumulation of the knowledge necessary for sustainable innovation, as opposed to companies where conflicts prevail, which tend to impede the free flow of ideas and information.

The impact of labour conflicts on innovation

Examining the impact of LCs on innovation within organisations reveals complex dynamics that can be particularly detrimental. Labour conflicts divert employees’ attention and energy away from creative and innovative activities, thereby reducing their ability to effectively contribute to the organisation’s innovation efforts (Kim & Bae, 2005). When employees are preoccupied with internal conflicts, their engagement in innovative initiatives diminishes, compromising the organisation’s ability to maintain a stimulating and innovation-friendly environment.

Furthermore, it is well established that LCs can lead to increased stress, decreased job satisfaction and lower employee motivation, all of which are directly harmful to their ability to think innovatively and solve complex problems (Zhang et al., 2018). The heightened stress and reduced job satisfaction create an unfavourable environment where employees become reluctant to take creative risks – an essential component of innovation. Consequently, these internal conflicts not only diminish employee motivation but also limit their engagement in innovative thinking processes.

Moreover, LCs often create an atmosphere of distrust and hostility within the organisation, thereby hindering effective collaboration and knowledge sharing among employees (Xi et al., 2022). This lack of collaboration and knowledge sharing severely hampers the flow of new ideas, which in turn obstructs the generation of innovative solutions. In summary, if not managed proactively and constructively, LCs can not only divert employee resources away from creative activities but also create an organisational environment that stifles innovation and disrupts productivity by limiting the collaboration and exchange of ideas necessary for creativity and collective innovation.

The impact of labour conflicts on employee motivation and engagement

Analysing the impact of LCs on employee motivation and engagement reveals critical organisational dynamics. Labour conflicts disrupt essential psychological needs, such as autonomy and interpersonal relationships, leading to a significant decrease in intrinsic motivation and a weakening of employees’ engagement with the organisation (Van Den Broeck et al., 2016). This disruption extends beyond visible tensions and deeply affects the motivational framework of employees, ultimately reducing their overall contribution to the organisation.

Additionally, unresolved conflicts create a negative work environment, characterised by reduced productivity and heightened employee disengagement (Paradinas-Márquez et al., 2023). This toxic atmosphere, marked by distrust and stress, exacerbates existing conflicts and establishes a vicious cycle that is difficult to break. In addition to these organisational challenges, such conflicts erode critical psychological factors, such as employee motivation and engagement, which are essential for maintaining organisational competitiveness and adaptability. It becomes evident that, without effective management, LCs can have long-lasting and profound effects on employee commitment.

Building on this, motivation is recognised as a fundamental pillar of modern management, and highly motivated and committed employees are crucial for enabling organisations to adapt to a constantly evolving global environment. However, LCs undermine this motivation, creating a significant barrier to innovation and organisational competitiveness. Thus, conflict management is intrinsically linked to an organisation’s ability to maintain long-term competitiveness.

Furthermore, unresolved conflicts disrupt the internal balance of organisations, leading to a marked decrease in employee motivation and engagement, which inevitably results in reduced productivity and organisational effectiveness (Shahid & Azhar, 2013). These disruptions also increase employee turnover rates, compromising operational continuity and team cohesion, thereby highlighting the systemic consequences of LCs on the entire organisation.

Finally, LCs have a direct impact on key elements such as job satisfaction, organisational engagement, compensation and rewards (Monyei et al., 2023). Among these factors, employee motivation stands out as the primary determinant of overall productivity. A motivated employee is not only more likely to deliver high performance but also more likely to actively engage in initiatives that benefit the organisation. Conversely, LCs, by eroding this motivation, lead to a significant reduction in productivity.

The impact of employee motivation and engagement on innovation

Research on the impact of motivation on innovation within organisations has revealed dynamics that are crucial for organisational success. It is well established that employees are more likely to engage in spontaneous and innovative activities when they feel a strong identification with their organisation (Salam & Senin, 2022).

Employee motivation is inextricably linked to innovative work behaviour, which is a critical driving force for innovation within companies. This behaviour, which includes the creation, promotion and reinforcement of innovative thinking, is essential not only for the personal success of employees but also for the overall success of the organisation. Motivation acts as a catalyst, encouraging employees to take risks, explore new ideas and challenge the status quo – elements that are indispensable for innovation.

However, demotivation can significantly affect employees’ ability to innovate, especially in contexts marked by LCs. Demotivated employees are often less inclined to take risks or engage in innovative efforts, which can stifle new ideas and slow down innovation initiatives within the organisation (Salam & Senin, 2022). Therefore, to maintain innovation capacity even during periods of conflict, it is imperative to foster an organisational culture that actively values and supports employee motivation.

Building on these observations, Salam and Senin (2022) confirmed that employee motivation and engagement have a significant impact on their innovative behaviour, which is crucial for organisational innovation. Employee engagement, in particular, can mediate the impact of LCs on their innovative behaviour. When employees are motivated and engaged, they are more likely to channel their energy into innovative activities, thereby contributing to the company’s success even in the presence of conflicts (Kim & Bae, 2005).

Thus, employee motivation emerges as a key factor in fostering innovation within organisations. It not only encourages innovative behaviour but also plays a crucial role in managing workplace challenges and conflicts, ensuring the continuity and success of innovative initiatives.

The impact of proactive labour conflict management on employee motivation and engagement

The importance of proactive LC management is widely recognised for maintaining a productive and engaged workforce. By adopting proactive conflict resolution approaches, organisations not only promote a harmonious work environment but also significantly enhance employee motivation and engagement, contributing to increased organisational effectiveness and reduced turnover rates. Strategic leadership plays a central role here, shaping employee attitudes and aligning organisational goals with individual interests, thereby boosting overall engagement and motivation (Bonau, 2020).

Moreover, the implementation of effective procedures for conflict resolution and the presence of clear policies for managing such conflicts are crucial in mitigating LCs. These frameworks not only help reduce misunderstandings and tensions but also empower employees by providing them with the necessary tools to address disputes constructively, fostering a more productive and satisfied workforce in the long term (Aminu & Marfo, 2010).

When organisations actively involve employees in decision-making processes and conflict resolution, it strengthens their sense of belonging and responsibility. This inclusion mitigates the negative effects of LCs and cultivates a more motivated and engaged workforce. Emphasising psychological capital, such as self-efficacy, optimism, hope and resilience, has also proven effective in improving conflict management, thereby enhancing employee engagement and productivity, particularly in knowledge-driven environments, contributing to increased motivation (Asif et al., 2019).

Furthermore, proactive LC management can reduce the negative impacts on employee motivation and engagement (Aniefiok et al., 2018; Hyde et al., 2006; Monyei et al., 2023). This approach creates an environment where employees feel valued and heard, increasing job satisfaction and reducing turnover intentions, which is crucial for maintaining a stable and motivated workforce. Organisations that actively commit to understanding and addressing the factors influencing employee engagement typically observe improved job satisfaction and performance, highlighting that investment in proactive conflict management (PCM) strategies is not only beneficial but also necessary to maintain a competitive edge in a constantly evolving business environment. It is imperative that management recognises employee motivations and employs appropriate strategies to foster engagement, as a well-informed approach can significantly enhance organisational performance and employee retention, particularly during times of change and instability, underscoring the critical importance of PCM.

Finally, by fostering a harmonious work environment, encouraging open communication and promoting a sense of collective responsibility, proactive LC management can significantly improve employee motivation and commitment. This approach not only aligns organisational goals with employee interests but also strengthens engagement and job satisfaction, thereby consolidating employee loyalty. Investing in PCM strategies helps organisations maintain a competitive advantage and sustain a stable and motivated workforce, even during periods of change and instability (Aminu & Marfo, 2010; Asif et al., 2019).

Hypothesis development

This study examines the relationships between LCs, employee motivation and engagement, proactive HRM practices and employee innovation, as illustrated in Figure 1. Based on insights from the literature, the following hypotheses are proposed:

H1: Labour conflicts negatively affect employee innovation.

H2: Labour conflicts negatively affect employee motivation and engagement.

H3: Employee motivation and engagement positively affect innovation.

H4: Proactive conflict management reduces the negative effect of labour conflicts on employee motivation and engagement.

FIGURE 1: Conceptual model of the impact of labour conflicts on innovation and the role of proactive management.

The conceptual model presented in Figure 1 illustrates these hypothesised relationships. It highlights the mediating role of employee motivation and engagement in the relationship between labour conflicts and employee innovation, as well as the moderating role of proactive HRM practices in mitigating the adverse effects of labour conflicts on motivation and engagement. This framework serves as the theoretical foundation for the hypotheses tested in this study and reflects the dynamic interplay between organisational conflict management, employee psychology and innovation outcomes.

Research design

To systematically examine the impact of LCs on employee innovation and the role of proactive HRM, a structured methodological approach was employed. This section presents the research framework, including the study design, data collection methods, sampling strategy and statistical analysis techniques used to test the hypothesised relationships.

Research approach

The study employed a quantitative research approach to investigate the impact of LCs on employee innovation and the moderating role of proactive HRM practices. This approach was selected for its capacity to quantify relationships and provide statistical evidence concerning the effects of LCs on innovation within organisations. A SEM technique was utilised, enabling the simultaneous analysis of complex relationships among latent variables, including LCs, PCM, employee motivation and innovation. Given the complexity of these relationships, this method allows for testing multiple direct, indirect and moderating effects while accounting for measurement errors, ensuring a robust analysis of the proposed hypotheses (Hair et al., 2019).

Research method

Research participants

The study sampled 400 employees from various hierarchical levels across different sectors of Moroccan companies, including industry, trade, services and others. This sample size was determined to ensure statistical reliability and sufficient variability in responses, thereby enhancing the generalisability of the findings. These sectors were chosen because of their significant contribution to Morocco’s gross domestic product (GDP) and employment, as well as their exposure to frequent labour disputes, making them ideal for assessing the impact of LCs on employee innovation. The selection was proportionally based on the number of LCs recorded at the national level, ensuring a representative sample (Ministry of Economic Inclusion, Small Business, Employment and Skills, 2022).

To capture diverse workplace experiences and conflict dynamics, participants were required to have at least 1 year of tenure within their current organisation. Employees in temporary or part-time positions were excluded to maintain consistency in the employment context.

Data collection took place between 15 March 2024 and 20 July 2024. Respondents were chosen through a combination of convenience and stratified sampling, ensuring sectoral diversity and accurately reflecting the specific dynamics of LCs within each industry. Stratification was based on industry type and company size to ensure heterogeneity in the sample and a balanced representation of employees working in different professional environments. This methodological approach allowed for a more nuanced understanding of how LCs and HRM practices influence employee motivation and innovation across various organisational contexts.

Measuring instruments

A structured questionnaire was utilised to collect data, incorporating a 5-point Likert scale to assess perceptions of LCs, proactive HRM practices, employee motivation and innovation. The questionnaire was carefully designed to ensure that the selected items accurately measured the latent variables identified in the study:

• Labour Conflicts (LC): This construct was assessed using indicators that reflect the frequency and impact of conflicts within the organisation. Items such as ‘Labour conflicts are common in my organisation’ and ‘Labour conflicts often disrupt our productivity’ were included to capture the extent and influence of LCs as perceived by employees.
• Proactive Conflict Management (PCM): The PCM construct was measured through items that evaluated the effectiveness of organisational practices in managing conflicts. Statements such as ‘My company has implemented effective procedures for resolving conflicts’ and ‘There are clear policies for managing labour conflicts’ were used to gauge the level of proactive HRM practices in addressing workplace conflicts.
• Employee Motivation and Engagement (ME): To measure employee motivation and engagement, the questionnaire included items reflecting the respondents’ enthusiasm and pride in their work. Examples of items included ‘I am highly motivated to achieve my work objectives’ and ‘I am proud to work for my company’, which represent the level of motivation and commitment employees feel towards their roles.
• Employee Innovation (EI): Employee innovation was assessed through items capturing the extent to which employees engage in innovative behaviours. The questionnaire included statements such as ‘I often propose new ideas to improve work processes’ and ‘I take initiatives to introduce innovative solutions’, providing a measure of the respondents’ innovative contributions within their work environment.

The reliability and validity of these measuring instruments were rigorously evaluated. Cronbach’s alpha scores for all constructs exceeded the acceptable threshold of 0.7, indicating strong internal consistency. These findings demonstrate that the questionnaire items effectively captured the complexities of the latent variables within the SEM framework, ensuring the reliability and appropriateness of the measurement scales for the study’s objectives.

Research procedure and ethical considerations

Data collection was conducted using self-administered questionnaires. Participants were informed of the study’s purpose, assured of confidentiality and provided with consent forms outlining their voluntary participation. To ensure ethical compliance, all participants’ responses were anonymised, and data were securely stored to maintain confidentiality throughout the study.

Statistical analysis

Data were analysed using structural equation modelling (SEM), a robust statistical method ideal for examining complex relationships between observed and latent variables. The SEM technique was chosen for its capability to model direct and indirect effects, correct measurement errors and provide accurate estimates of the relationships between LCs, PCM, employee motivation and innovation. The model was tested using the Lavaan package in R (Rosseel, 2012), applying the maximum likelihood (ML) estimation method.

The analysis involved two primary stages:

• Reliability and Validity Assessment: Internal consistency was evaluated using Cronbach’s alpha, while construct validity was assessed through confirmatory factor analysis.
• Structural Model Testing: The proposed hypotheses were examined, and the relationships between variables were tested, ensuring a comprehensive understanding of the effects of LCs on innovation and the role of proactive HRM practices.

This methodological approach ensures a rigorous examination of the study’s objectives, providing credible and actionable insights for organisations aiming to mitigate LCs and foster an innovation-friendly environment.

Ethical considerations

Ethical clearance to conduct this study was obtained from the Laboratory TREE (Energy and Environmental Transitions), College of Social Sciences and Humanities, University of Pau and the Adour Regions, Pau, France.

Results

The distribution of respondents across economic sectors is crucial for understanding the context within which employees in this study operate, particularly regarding the impact of LCs on innovation and the role of proactive HRM. The sample was drawn from four primary sectors: industry (28%), services (29%), agriculture (26%) and trade (18%), ensuring a diverse and representative workforce.

The industry and services sectors, which account for 28% and 29% of the respondents, respectively, constitute the largest groups in the sample. This substantial representation is vital as it provides deep insights into conflict management and innovation practices within these structurally complex and high-density work environments. The agriculture sector, contributing 26% of the responses, and the trade sector, with 18%, complete the sample, thereby enhancing the scope and representativeness of the study.

This balanced sectoral distribution enables the findings to be generalised across various economic and organisational contexts, ensuring reliability and relevance. Furthermore, it highlights the unique challenges each sector might face in addressing LCs and fostering innovation. For instance, the industry and services sectors often require specific strategies to navigate hierarchical complexities and workforce density effectively. In contrast, the agriculture and trade sectors present distinct dynamics that necessitate tailored approaches to conflict resolution and innovation management.

The analysis of the demographic data from our study reveals the distribution of respondents by gender and hierarchical level, providing essential insights into the organisational structure of our sample. This distribution is crucial for understanding the impact of LCs on innovation and proactive HRM. Table 1 presents this hierarchical diversity, enabling us to examine how employees’ perceptions and experiences vary based on their position within the organisation.

Table 1 shows a significant distribution of respondents across different hierarchical levels, with 35 managers, 50 upper senior managers, 107 managerial staff, 34 supervisors and 159 employees. This hierarchical diversity is essential for analysing the dynamics of LCs and innovation at various levels within the organisation.

The presence of 107 managerial staff and 34 supervisors in the sample indicates that we have included individuals who play a key role in implementing HRM policies and in the day-to-day management of teams. This inclusion allows for a better understanding of how PCM practices are perceived and applied at different levels within the organisation and how these practices can be optimised to create an environment conducive to innovation.

After analysing the demographic characteristics of the sample, it is essential to assess the adequacy of the measurement model before proceeding to hypothesis testing. Evaluating model fit indices ensures that the proposed structure accurately represents the underlying constructs and provides a reliable foundation for the subsequent regression analyses.

Model fit

The fit indices indicate that the proposed model aligns well with the data. Table 2 presents the results of the model fit tests, which are used to evaluate the quality of the model’s fit to the collected data.

Parameter estimates

The fit indices indicate that the proposed model aligns well with the data, which carries significant implications for our research on the impact of LCs on innovation and the role of proactive HRM practices. The strong fit indices, such as the Comparative Fit Index (CFI) and Tucker–Lewis Index (TLI) values above 0.95, as well as the Root Mean Square Error of Approximation (RMSEA) and Standardised Root Mean Square Residual (SRMR) values below 0.08, confirm the validity of our theoretical hypotheses regarding the relationships between LCs, PCM, employee motivation and innovation. Although the RMSEA suggests a slight inaccuracy in the modelling, the overall model fit is strong, indicating that the complex relationships between latent variables are well captured. This supports the credibility of our conclusions regarding the impacts of LCs and proactive management strategies.

Furthermore, the strength and reliability of the model demonstrate that the hypothesised relationships tested are robust and consistent with the empirical data. This robustness enhances the relevance of our recommendations for improving HRM practices and fostering innovation. Additionally, the fit indices indicate that the model accurately represents the actual data from the Moroccan companies studied, suggesting that the conclusions drawn can be applied in a relevant and practical manner within this context.

Moreover, the satisfactory model fit enables us to conclude that our theoretical model is well aligned with the observed data, allowing us to draw robust conclusions on the impact of LCs on innovation and the role of PCM.

Once the model fit indices confirmed the adequacy of the measurement model, the next step was to assess the validity and reliability of the latent constructs through an analysis of factor loadings. This step ensures that the indicators used effectively measure the intended theoretical constructs before proceeding with hypothesis testing.

Latent variables

Before testing the hypothesised relationships, it is essential to ensure that each latent variable is reliably measured. This step strengthens the validity of the structural model and ensures that the constructs accurately capture the theoretical dimensions of LCs, proactive HRM, motivation and innovation.

The analysis of the factor loadings of latent variables and their indicators, as summarised in Table 3, is pivotal for evaluating the validity of the measures in our study on the impact of LCs on employee innovation and proactive HRM.

The factor loadings reflect the strength of the relationship between each observable indicator and the latent variable it is intended to measure. Following the recommendations of Hair et al. (2019), a factor loading above 0.70 indicates strong convergent validity. In this study, all primary indicators exceeded this threshold, except for LC2 (0.471), which, despite being lower, remains statistically significant and relevant within the theoretical framework.

To ensure a concise yet robust measurement of the constructs, each latent variable was measured using two carefully selected items. This approach was adopted to capture the most relevant dimensions directly related to the study’s objectives, particularly given the sensitivity of questions regarding LCs. While this choice prioritises clarity and reliability, the use of two items per variable may limit the ability to comprehensively capture all dimensions, a consideration addressed in the limitations section.

For LC, the indicator LC1 (‘Labour conflicts are common in my organisation’) has a very high factor loading (0.971), confirming that employees strongly associate conflict frequency with their work environment. In contrast, LC2 (‘Labour conflicts often disrupt our productivity’) has a lower loading (0.471), suggesting that while employees acknowledge the presence of conflicts, they may perceive their impact on productivity differently. These results support the robustness of the labour conflict construct within the measurement model.

For PCM, the loadings for PCM1 (0.876) and PCM2 (0.810) are both high and significant. These findings align with Hypothesis 4 (H4), which posits that PCM reduces the negative effect of LCs on employee motivation and engagement.

For motivation and engagement (ME), the loadings of ME1 (0.751) and ME2 (0.815) are also significant and high, indicating that these indicators are accurate representations of employee motivation and engagement. These findings provide empirical support for Hypothesis 3 (H3), which posits that employee motivation and engagement positively affect innovation.

Lastly, for employee innovation (EI), the loadings for EI1 (0.907) and EI2 (0.933) are very high and significant, indicating an excellent representation of this latent variable by these indicators. This result aligns with Hypothesis 1 (H1), reaffirming that LCs negatively affect employee innovation, reinforcing the necessity of conflict mitigation strategies to sustain innovation within organisations.

In conclusion, the factor loadings of the latent variables demonstrate that the selected indicators are both reliable and valid measures of the theoretical constructs under investigation.

With the validity and reliability of the measurement model confirmed, the next step involved testing the hypothesised relationships through regression analyses.

Regressions

To further explore the relationships between LCs, proactive HRM and innovation, a regression analysis was conducted to test the hypothesised relationships. The regression results for the latent variables, presented in Table 4, offer valuable insights into the complex interactions between LCs, proactive HRM, employee motivation and engagement, and organisational innovation.

These findings directly contribute to addressing the study’s objectives by clarifying the impact of LCs on innovation and assessing the moderating role of proactive management practices.

To test H1, which posits that LCs negatively affect employee innovation, the results confirm this hypothesis, showing a significant negative relationship (β = −0.539, p < 0.001). These findings support H1, suggesting that workplace conflicts substantially reduce employees’ engagement in innovative activities. This aligns with previous research highlighting that workplace tensions create psychological distress, hinder collaboration and ultimately limit creative problem-solving capabilities.

For H2, which examines the relationship between LCs and employee motivation and engagement, the results indicate a negative but non-significant relationship (β = −0.096, p = 0.123). However, the results do not support H2, as the relationship between LCs and motivation was not statistically significant. While a slight negative trend is observed, this finding suggests that contextual factors, such as workplace culture, leadership support or alternative motivational mechanisms, may moderate this effect. Future studies should explore the conditions under which LCs influence employee motivation.

Regarding H3, which asserts that employee motivation and engagement positively affect innovation, the results support this hypothesis, revealing a significant positive relationship (β = 0.414, p < 0.001). Hypothesis 3 is supported, indicating that highly motivated and engaged employees are more likely to generate, propose and implement innovative ideas. This confirms existing literature emphasising that employee engagement fosters creativity and enhances innovative behaviour in organisations.

Finally, H4 tested whether PCM positively influences employee motivation and engagement. The results confirm this hypothesis, showing a significant positive association (β = 0.665, p < 0.001). The findings validate H4. Proactive conflict management reduces the negative effect of LCs on employee motivation and engagement. This highlights the importance of proactive HRM practices, such as implementing effective procedures for resolving conflicts and clarifying conflict management policies, which play a crucial role in fostering a positive and motivating work environment. These results are consistent with previous research, which suggests that well-managed conflict resolution strategies create a more inclusive and participative work environment, thereby enhancing employee motivation.

Overall, the results indicate that LCs negatively impact innovation, while employee motivation has a positive effect. Additionally, effective management practices increase employee motivation, although the direct impact of LCs on motivation is not statistically significant.

Covariances

The covariance analysis provides valuable insights into the non-directional relationships between LC and PCM. The results demonstrate a significant inverse relationship between these variables, with a covariance coefficient of −0.541 (p < 0.001). This finding highlights that organisations implementing effective proactive management strategies tend to experience a substantial reduction in the frequency and intensity of LCs.

This relationship illustrates the critical importance of proactive HRM practices in mitigating the negative impact of LCs. By establishing clear and transparent procedures for conflict resolution, organisations can create a work environment that fosters open communication, reduces misunderstandings and promotes collaboration. These strategies not only decrease the prevalence of LCs but also contribute to a more harmonious and productive organisational culture.

The significant negative covariance reinforces the study’s objectives, demonstrating that proactive management practices are a fundamental tool in reducing LCs. This outcome aligns with the broader conclusions of this research, which emphasise the transformative potential of proactive HRM strategies in fostering innovation and improving workplace dynamics.

Variances and R-squared

To deepen the understanding of the relationships between LCs, PCM, employee motivation and innovation, it is essential to evaluate the explanatory power of the model through the analysis of variances and R-squared values. These metrics quantify how effectively the observed variables explain the latent constructs within the SEM, providing insights into the model’s robustness and predictive validity.

In this study, the analysis of variances and R-squared values enables the identification of key factors driving the dynamics between LCs and organisational innovation. Specifically, it highlights the role of proactive HRM strategies in mitigating conflicts and fostering innovation. The results offer a comprehensive view of how well each construct is represented and its contribution to the overall model.

The R-squared values presented in Table 5 highlight the robustness of the model in explaining the relationships between LCs, proactive management, motivation and innovation. For example, 82.3% of the variance in employee innovation is explained by motivation and LCs, reflecting the significant role of these factors in shaping innovative behaviours. Furthermore, the path coefficients indicate that proactive management has a strong positive effect on motivation (β = 0.665, p < 0.001), and motivation directly influences innovation (β = 0.414, p < 0.001). However, the non-significant relationship between LCs and motivation (β = −0.096, p = 0.123) suggests the need for further investigation into moderating variables, such as organisational culture or leadership styles, that may affect this relationship.

As shown in Table 5, for the variable ‘Labour Conflicts (LC)’, the R-squared value of 0.943 indicates that the model explains 94.3% of the variance, demonstrating that the indicators LC1 and LC2 effectively capture this dimension. This result validates the model’s effectiveness in analysing LCs, which is crucial for developing strategies to reduce such conflicts.

Concerning ‘Proactive Conflict Management (PCM)’, the R-squared value of 0.768 shows that 76.8% of the variance is explained by the indicators PCM1 and PCM2. This result highlights that proactive management practices are well represented in the model and play a significant role in reducing LCs.

For the variable ‘Motivation and Engagement (ME)’, the R-squared value of 0.564 indicates that 56.4% of the variance is explained, suggesting that more than half of employee motivation and engagement is influenced by LCs and proactive management. The indicators ME1 and ME2 are relevant to this dimension.

Lastly, for ‘Employee Innovation (EI)’, the R-squared value of 0.823 reveals that 82.3% of the variance is explained by the indicators EI1 and EI2. This result is particularly important as it validates the critical role of innovation in the competitiveness and adaptability of companies.

The variance and R-squared results shown in Table 5 reinforce the validity and reliability of the model. These findings confirm that PCM and employee motivation are essential for reducing LCs and promoting innovation. These results align with the research objectives by demonstrating how proactive HRM practices and employee motivation mediate the impact of LCs on innovation, thereby confirming the proposed hypotheses.

The path diagram presented in Figure 2 illustrates the modelled relationships between LCs, proactive management, employee motivation and engagement, and employee innovation, providing a clear visual representation of the links identified in our conceptual model.

FIGURE 2: Structural path model illustrating the relationships between labour conflicts, proactive conflict management, employee motivation and engagement, and employee innovation.

Overall, the results provide strong empirical support for the proposed model, confirming that LCs have a detrimental impact on innovation, while proactive HRM practices play a crucial role in enhancing employee motivation and engagement. The non-significant relationship between LCs and motivation suggests the need for further research on moderating variables that could influence this interaction. These findings contribute to the existing literature on workplace conflicts and HRM strategies, offering valuable insights for organisations seeking to foster innovation and improve employee engagement.

Discussion

This study aimed to explore the complex interplay between LCs, proactive HRM practices and employee innovation. By leveraging a SEM approach, we sought to uncover how LCs hinder innovation and how proactive management practices can mitigate these effects. The findings offer valuable insights into the dynamic relationships among these variables, contributing to both theoretical and practical understandings of organisational behaviour.

The discussion that follows is structured to interpret the results in the context of the proposed hypotheses and the existing literature. Each hypothesis is evaluated based on the empirical evidence, providing a comprehensive analysis of the factors that influence employee innovation. Additionally, the implications for HRM practices and organisational strategies are considered, highlighting the transformative potential of PCM in fostering a culture of innovation.

Outline of the results

The findings of this study confirm Hypothesis 1, indicating that LCs have a significant negative impact on employee innovation, with a regression coefficient of −0.539 (p < 0.001). These results align with Kim and Bae (2005), who highlighted that LCs divert employees’ attention away from innovative activities, thereby reducing their ability to contribute to organisational innovation. Additionally, Zhang et al. (2018) demonstrated that heightened stress and decreased job satisfaction caused by workplace conflicts hinder employees’ ability to engage in innovative thinking and problem-solving. Xi et al. (2022) further emphasised that LCs create an atmosphere of distrust and hostility, disrupting collaboration and knowledge sharing – key enablers of innovation. Collectively, these findings reinforce the notion that unresolved LCs pose a substantial threat to organisations’ innovation capacity, underscoring the importance of proactive management strategies to mitigate these effects.

However, Hypothesis 2, which posited that LCs negatively impact employee motivation and engagement, is not supported, as the regression coefficient is −0.096 (p = 0.123). While there appears to be a slight negative trend, the relationship is not statistically significant. This result suggests that the impact of LCs on motivation and engagement may depend on the presence of mediating or moderating variables, such as organisational support or conflict resolution mechanisms. Future research should explore these dynamics further to identify potential mediators that can help clarify this relationship.

Hypothesis 3, which posited a positive relationship between employee motivation and innovation, is supported with a regression coefficient of 0.414 (p < 0.001). This aligns with Salam and Senin (2022), who demonstrated that motivated employees are more likely to engage in innovative behaviours, such as generating and implementing creative ideas. These findings highlight the critical role of motivation in fostering innovation, particularly in challenging environments. This suggests that fostering motivation is essential not only for improving individual performance but also for sustaining organisational innovation.

Finally, Hypothesis 4 is validated, showing that proactive HRM practices mitigate the negative impact of LCs on employee motivation and engagement, with a regression coefficient of 0.665 (p < 0.001). This aligns with Aminu and Marfo (2010), who emphasised that clear conflict resolution policies and frameworks empower employees to address disputes constructively, fostering a more motivated and engaged workforce. Bonau (2020) further supported this finding, highlighting that proactive management strategies reduce misunderstandings and tensions, improving employee satisfaction and engagement. Additionally, Asif et al. (2019) demonstrated that investing in psychological capital – such as resilience and optimism – through proactive HRM practices enhances employees’ ability to cope with workplace conflicts. These findings reaffirm that PCM is a critical organisational strategy for maintaining motivation, even in the face of workplace tensions.

Practical implications

The findings of this study carry substantial practical implications for HR managers and organisational leaders, emphasising the critical role of proactive HRM practices in managing LCs. By implementing structured procedures for conflict resolution and establishing clear policies, organisations can significantly mitigate the occurrence and impact of LCs. This not only fosters a more harmonious and supportive work environment but also serves as a catalyst for enhancing employee motivation and engagement. In turn, such an environment is conducive to increased levels of innovation within the organisation. Therefore, it is imperative for organisations to prioritise investment in proactive HRM strategies, as doing so not only prevents the escalation of conflicts but also nurtures a culture that encourages creativity and innovation, which are essential for long-term organisational success.

Limitations and recommendations

While this study provides valuable insights into the impact of LCs on employee innovation, several limitations should be noted. Firstly, the study’s reliance on self-reported data may introduce bias, as employees might not accurately disclose their experiences with conflicts. Secondly, the study focused on a specific sample of Moroccan companies, which may limit the generalisability of the findings to other cultural or economic contexts. Additionally, a limitation of this study lies in the use of two items per latent variable, particularly for the sensitive dimensions related to LCs. This approach, while effective in reducing respondent fatigue, may have restricted the ability to fully capture the complexity of the constructs examined. Future research could incorporate more detailed scales to explore in greater depth the intricate dynamics between LCs, proactive HRM practices and their impact on organisational innovation. Future research should consider using qualitative methods to gain deeper insights into the mechanisms of LCs and their impact on innovation. Additionally, longitudinal studies would be beneficial in examining the long-term effects of proactive HRM practices on employee innovation.

Conclusion

This study comprehensively investigated the impact of LCs on employee innovation, with a particular emphasis on the role of proactive HRM practices in mitigating these adverse effects. The findings confirmed that LCs significantly diminish employee motivation and engagement, which in turn hampers their capacity for innovation. This outcome aligns with the first research objective, which sought to analyse how LCs influence employee innovation within organisations.

Furthermore, the study demonstrated that proactive HRM practices, such as implementing clear conflict resolution policies and fostering open communication, play a pivotal role in mitigating the negative impact of LCs on employee innovation. This result directly addresses the second objective, which aimed to identify effective HRM practices for managing LCs and fostering an environment conducive to innovation. The findings emphasise that proactive HRM strategies not only reduce workplace tensions but also enhance organisational resilience, creating conditions that support sustained innovation.

In the Moroccan context, where workplace conflicts remain a pressing challenge across various sectors, these findings highlight the urgent need for organisations to strengthen HRM practices tailored to the country’s evolving economic and regulatory landscape. The rise of new employment models, sectoral transformations and increasing labour market flexibility necessitates PCM strategies to ensure workforce stability and long-term competitiveness. Moroccan firms must therefore invest in participative HR frameworks and conflict prevention mechanisms to foster a culture of innovation while maintaining industrial harmony.

From a practical standpoint, the study offers valuable insights for HR managers and organisational leaders. By prioritising preventive measures and engagement-focused strategies, it highlights that adopting PCM practices not only helps to minimise the detrimental effects of LCs but also significantly contributes to fostering a work environment that enhances employee motivation, engagement and innovation. This insight directly fulfils the third objective, which aimed to provide actionable recommendations for HR professionals to manage LCs effectively.

In conclusion, this study contributes to the existing body of knowledge by providing empirical evidence of the detrimental impact of LCs on employee innovation and by emphasising the essential role of proactive HRM practices in mitigating these effects. The study also highlights its practical relevance by providing a roadmap for organisations aiming to transform workplace conflicts into opportunities for growth and creativity. The findings reinforce the notion that effective conflict management strategies are crucial not only for minimising the negative consequences of conflicts but also for cultivating a culture of innovation. Future research could explore longitudinal approaches to assess the long-term impact of these strategies and examine cultural or sectoral variations in conflict management and innovation practices. These insights are particularly valuable for organisations striving to maintain competitiveness and sustainability in an increasingly dynamic and evolving economic landscape.

Acknowledgements

The authors sincerely thank the employees from various sectors who contributed to this study and express their gratitude to Mr. Yassin Barakat for his valuable technical assistance.

The authors declare that they have no financial or personal relationships that may have inappropriately influenced them in writing this article.

A.B. conducted this study, H.E.A. supervised the study and A.O. developed the theoretical framework and contributed to the final version of the manuscript.

This study received no specific grant from any funding agency in the public, commercial or not-for-profit sectors.

The data that support the findings of this study are available from the corresponding author, A.B., upon reasonable request.

The views and opinions expressed in this article are those of the authors and are the product of professional research. They do not necessarily reflect the official policy or position of any affiliated institution, funder, agency or that of the publisher. The authors are responsible for this study’s results, findings and content.

References