Underpinning the social categorisation paradigm, workforce diversity literature highlights adverse effects of surface diversity such as gender and age on employee affect. These detrimental effects are often attributed to low levels of inclusion. We examine the applicability of surface diversity effects in the Indian social milieu. How perceived dissimilarity affects employee well-being becomes important as social categorisation can invoke feelings of low levels of inclusion. Since diversity effects are deemed to be context-specific, in a first, we test the moderating impact of employee’s perceived organisational politics on the inclusion mediated link between surface diversity and well-being. We surveyed 617 employees from organisations representing six industries in India. Post ascertaining the measurement and structural model fit using AMOS 22, we used the PROCESS macro (Model 58) to test for moderated-mediation effects. Perception of organisational politics moderated the surface diversity–inclusion–well-being link such that inclusion was found to be weaker for employees who perceived high levels of organisational politics and vice versa. We contribute to extant diversity literature in three ways: First, we examine diversity attributes salient in the Indian context while advancing the perceived diversity literature. Secondly, we examine under-studied diversity outcomes (affect-related), specifically, employee well-being, which is vital for individual and organisational sustainability. Thirdly, moving away from direct effects and considering the context-centricity of diversity research, we examine perception of organisational politics as a moderator that has not received sufficient scholarly attention. We present important implications for indigenous diversity research and practice. Organisational leaders must build open and transparent systems so that employees do not consider inclusion as a politically motivated tactic. Further, leaders must engage in diversity programmes as a bundle of activities such as educating managers about unconscious biases and creating a shared impression of an inclusive organisational culture.
