The effect of black tax and psychological capital on employee well-being

Abstract

In addition to poverty, persisting income inequality and high unemployment rates, the lives of most South Africans are defined by the harsh reality of having to support their families financially. The additional support refers to Black Tax, a term that has shifted from colloquialism to academic literature due to its pervasiveness and impact on many. The Black Tax experience was appraised as a threat or challenge through the Stress Theory lens. The research aimed to determine how individuals' perceptions of Black Tax impacted employee well-being. Particularly, what is the relationship between the stress generated by the personal experience of Black Tax and individuals' job and life satisfaction? The quantitative research was conducted using a questionnaire that gathered 250 valid responses from individuals of African ethnicity between the ages of 20 and 60. Validity and reliability were examined by Confirmatory Factor Analysis and by confirming that Cronbach's alpha was within an acceptable level. Hypothesis testing confirmed a negative relationship between the perception of Black Tax as a threat and employee well-being; there was no significant correlation between the perception of Black Tax as a challenge and employee well-being. Interestingly, this relationship changed through the mediation of Psychological Capital - fully mediated in the case of Black Tax as a challenge and partially mediated in the evaluation of Black Tax as a threat. The results further showed that gender moderated the relationship between the perception of Black and employee well-being. Therefore, individuals' perspectives and the personal significance they attach to Black Tax have a more significant influence than Black Tax itself.