The Moderating Role of Psychological Well-Being on The Relationship Between Compensation and Employee Performance
Main Article Content
Abstract
This study aims to examine the effect of compensation on employee performance with psychological well-being as a moderating variable in Islamic banks in Sidoarjo. Using quantitative methods with a survey approach, data were collected from 100 Islamic bank employees who met certain criteria. The results showed that compensation has a significant influence on employee performance. In addition, psychological well-being is proven to strengthen the effect of compensation on employee performance, which indicates the importance of psychological well-being in maximizing the effectiveness of compensation. This research provides an important contribution for management in designing a fair compensation system and effective welfare programs to improve employee performance.
Downloads
Article Details
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
References
Armstrong, M., & Taylor, S. (2014). Armstrong's Handbook of Human Resource Management Practice. Kogan Page Publishers.
Bangsu, M., Dahar, & D. S. Negara. (2023). Implementation of Labor Law: Improving Lecturer Performance Through The Role of Leadership and Compensation, International Journal of Service Science, Management, Engineering, and Technology, 3(1), 26–31.
Beauregard, T. A., & Henry, L. C. (2009). Making the link between work-life balance practices and organizational performance. Human Resource Management Review, 19(1), 9-22.
Dahar, D. & R. Mardikaningsih. (2022). The Influence of Compensation and Work Environment on the Performance of Sub-District Employees, International Journal of Service Science, Management, Engineering, and Technology, 1(1), 28 – 32.
Darmawan, D. (2024). Distribution of Six Major Factors Enhancing Organizational Effectiveness. Journal of Distribution Science, 22(4), 47-58.
Darmawan, D., R. Mardikaningsih, E. A. Sinambela, S. Arifin, A.R. Putra, M. Hariani, M. Irfan, Y.R. Al Hakim, & F. Issalillah. (2020). The Quality of Human Resources, Job Performance and Employee Loyalty. International Journal of Psychosocial Rehabilitation, 24(3), 2580-2592.
Devonish, D. (2016). Emotional intelligence and job performance: the role of psychological well-being. International Journal of Workplace Health Management, 9(4), 428-442.
Djazilan, M. S. & D. Darmawan. (2020). Effect of Compensation, Job Demand, Job Characteristics on Employee Retention, Journal of Science, Technology and Society, 1(2), 1-8.
Eddine, B. A. S., D. Darmawan, R. Mardikaningsih, E. A. Sinambela. (2023). The Effect of Knowledge Management and Quality of Work Life on Employee Commitment. Journal of Human Sciences, 10(1), 87-100.
Eddine, B. A. S. & D. Darmawan. (2023). Sales Performance Improvement Through Monitoring of Work Experience and Quality Work of Life, Journal of Marketing and Business Research, 3(1), 71-80.
Gerhart, B., & Fang, M. (2015). Pay, intrinsic motivation, extrinsic motivation, performance, and creativity in the workplace: Revisiting long-held beliefs. Annual Review of Organizational Psychology and Organizational Behavior, 2(1), 489-521.
Gupta, N., & Shaw, J. D. (2014). Employee compensation: The neglected area of HRM research. Human Resource Management Review, 24(1), 1-4.
Hariani, M. (2023). Unleasing Organizational Commitment: Unravelling the Impact of Contract Worker Competence, Leadership, and Organizational Culture, International Journal of Service Science, Management, Engineering, and Technology, 3(1), 11–16.
Huang, L.-C., Ahlstrom, D., Lee, A.Y.-P., Chen, S.-Y. & Hsieh, M.-J. (2016). High performance work systems, employee wellbeing, and job involvement: an empirical study. Personnel Review, 45(2), 296-314.
Infante, A. & D. Darmawan. (2022). Women in Human Resource Management Practice, Journal of Social Science Studies, 2(1), 27-30.
Irfan, M., D. S. Sigita & M. Hariani. (2023). Optimizing Employee Performance through Work Motivation and Job Satisfaction: A Case Study in a Surabaya-based Company. Bulletin of Science, Technology and Society, 2(1), 12-15.
Jahroni, J., T.S. Anjanarko, & A.S. Wibowo. (2023). Driving Performance Excellence: Exploring the Impact of Leadership and Job Stress on Employee Performance, International Journal of Service Science, Management, Engineering, and Technology, 3(1), 1–10.
Jannah, S.M. & R. Mardikaningsih. (2023). Strategies for Improving Bureaucratic Efficiency and Employee Performance, International Journal of Service Science, Management, Engineering, and Technology, 4(2), 10–14.
Jiang, K., Lepak, D. P., Hu, J., & Baer, J. C. (2012). How does human resource management influence organizational outcomes? A meta-analytic investigation of mediating mechanisms. Academy of Management Journal, 55(6), 1264-1294.
Kundi, Y.M., Aboramadan, M., Elhamalawi, E.M.I. & Shahid, S. (2021). Employee psychological well-being and job performance: exploring mediating and moderating mechanisms, International Journal of Organizational Analysis, 29(3), 736-754.
Kuvaas, B. (2006). Performance appraisal satisfaction and employee outcomes: Mediating and moderating roles of work motivation. International Journal of Human Resource Management, 17(3), 504-522.
Lazear, E. P. (2000). Performance pay and productivity. American Economic Review, 90(5), 1346-1361.
Lawler, E. E. (2003). Treat people right! How organizations can create a culture of high performance. Jossey-Bass.
Magnier-Watanabe, R., Uchida, T., Orsini, P. & Benton, C. (2017). Organizational virtuousness and job performance in Japan: does happiness matter? International Journal of Organizational Analysis, 25(4), 628-646.
Mardikaningsih, R., & M. Hariani. (2020). Effect of Work Climate and Wages on Turnover Intention, Journal of Science, Technology and Society, 1(2), 21-28.
Mardikaningsih, R. (2024). Organizational Effectiveness and Green Human Resources Management. Bulletin of Science, Technology and Society, 3(1), 6-13.
Milkovich, G. T., & Newman, J. M. (2005). Compensation. McGraw-Hill.
Ng, T. W. H., & Feldman, D. C. (2009). How broadly does education contribute to job performance? Personnel Psychology, 62(1), 89-134.
Pfeffer, J. (1998). The human equation: Building profits by putting people first. Harvard Business School Press.
Putra, A. R. & R. Mardikaningsih. (2022). Study on Employee Performance Reviewing from Leadership, Innovative Behavior and Work Engagement, International Journal of Service Science, Management, Engineering, and Technology, 1(3), 4 – 10.
Putra, A.R. (2022). Improving Employee Performance through the Implementation of Total Quality Management and the Effectiveness of the Remuneration System, International Journal of Service Science, Management, Engineering, and Technology, 2(2), 1 – 5.
Putra, A.R. & D. Darmawan. (2024). The Role of Supervisory Support and Self-Efficacy on Work Effectiveness with Work Burnout as a Moderator Variable. Jurnal Simki Economic, 7(2), 439-451.
Robbins, S. P. (2003). Organizational Behavior. Prentice Hall.
Ryff, C. D. (1989). Happiness is everything, or is it? Explorations on the meaning of psychological well-being. Journal of Personality and Social Psychology, 57(6), 1069-1081.
Sharma, P., Kong, T.T.C. & Kingshott, R.P.J. (2016). Internal service quality as a driver of employee satisfaction, commitment and performance: exploring the focal role of employee well-being. Journal of Service Management, 27(5), 773-797.
Sturman, M. C. (2003). Searching for the inverted U-shaped relationship between time and performance: Meta-analyses of the experience/performance, tenure/performance, and age/performance relationships. Journal of Management, 29(5), 609-640.
Werdati, F., D. Darmawan & N. R. Solihah. (2020). The Role of Remuneration Contribution and Social Support in Organizational Life to Build Work Engagement, Journal of Islamic Economics Perspectives, 1(2), 20-32.
Wright, T. A., & Cropanzano, R. (2000). Psychological well-being and job satisfaction as predictors of job performance. Journal of Occupational Health Psychology, 5(1), 84-94.
Wulandari, W. & D. Darmawan. (2024). The Influence of Emotional Intelligence on Salesperson Performance. Jurnal Manajemen Bisnis dan Terapan, 2(2), 124-132.