The Gap Between Employee Compliance and Trust in Digital HR Across Industries

Abstract

Digital HR governance systems have rapidly permeated modern organizations, automating core human resource decisions including recruitment, performance appraisal, compensation benchmarking, and disciplinary processes. Despite widespread implementation, a paradoxical behavioural pattern consistently emerges: employees comply with AI-driven HR directives while simultaneously expressing disbelief in the fairness, accuracy, and legitimacy of these systems. This study examines the structural, psychological, and organizational antecedents of this Trust-Compliance Dissonance (TCD) — a novel framework introduced herein. Employing a sequential explanatory mixed-methods design, the study draws on survey data from 320 employees across five industries and 18 in-depth interviews. Findings reveal that perceived procedural opacity (β = -0.61, p < 0.001), absence of human oversight, and algorithmic unfairness are the primary drivers of the trust deficit. High governance intensity environments sustain compliance through structural coercion rather than normative legitimacy. The TCD framework offers a new analytical lens for researchers and practitioners navigating the governance of people management in the digital age. Practical recommendations address algorithmic transparency, human-in-the-loop design, and cross-sector digital HR literacy.