The Role of Job Satisfaction and Employee Motivation serves as a Mediating potency within the Remuneration System, Contributing to the Employee Loyalty. A Case Study in Hospitality Industry in Dili
Keywords:
Remuneration, Job Satisfaction, Employee Motivation, Employee Loyalty
Abstract
The objective of this research is to test and analyze the roles of job satisfaction and employee motivation in the remuneration system and employee loyalty. This study highlights the significance of recognizing and dealing with both internal and external motivations to boost employee performance and loyalty. Additionally, it stresses the importance of matching salary structures with educational backgrounds to enhance loyalty and dedication among employees, especially within the hotel sector in Dili. The research centers on employees in the hospitality sector, specifically hotels, in Dili. The study focuses on the population of the hospitality industry or hotels in the capital, Dili. A census or saturation sampling approach was employed, with a total sample of 205 employees from various hotels, and the data were analyzed using Smart PLS. The results indicate that the remuneration system influences employee loyalty through the mediation of job satisfaction and employee motivation. However, the remuneration system itself does not have a direct impact on employee loyalty within the hotel industry in Dili. Hospitality businesses in Dili should implement an effective remuneration system to enhance job satisfaction and employee motivation, ultimately increasing employee loyalty. This can be achieved by offering competitive salaries and incentives based on employee performance
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References
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Au-yong-oliveira, M. (2021) ‘Boosters of satisfaction , performance and employee loyalty : application to a recruitment and outsourcing information technology organization Cl’, pp. 1036–1046. doi: 10.1108/JOCM-01-2021-0015.
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Lee, B. et al. (2022) ‘Analyzing Determinants of Job Satisfaction Based on Two-Factor Theory’, Sustainability (Switzerland), 14(19), pp. 1–19. doi: 10.3390/su141912557.
Lee, Y., Kim, S., Day, C. B., Swanson, E. M., & Kim, E. (2021). The expatriate and local hotel general managers : differing approaches to employees ’ loyalty sharing efforts. https://doi.org/10.1108/IJOEM-03-2020-0278
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Linz, S., Good, L. K. and Busch, M. (2015) ‘Promoting worker loyalty : an empirical analysis’, 36(2), pp. 169–191. doi: 10.1108/IJM-06-2013-0129.
Liu, J. da C. (2018) ‘Impaktu Motivasaun ba Loyaldade Servisu Staff iha Novo Turismo Resort and SPA’, Hospitality Review, p. 25.
Mardanov, I. (2020) ‘Intrinsic and extrinsic motivation, organizational context, employee contentment, job satisfaction, performance and intention to stay’, Evidence-based HRM, 9(3), pp. 223–240. doi: 10.1108/EBHRM-02-2020-0018.
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Mugira, A. (2022) ‘Leadership Perspective Employee Satisfaction Analysis’, AKADEMIK: Jurnal Mahasiswa Humanis, 2(3), pp. 127–135. doi: 10.37481/jmh.v2i3.477.
Noviani, E. (2021) ‘the Importance of Providing Motivation To Bring Work Spirit That Impact on Increasing Performance’, AKADEMIK: Jurnal Mahasiswa Ekonomi & Bisnis, 1(2), pp. 49–58. doi: 10.37481/jmeb.v1i2.219.
Ozturk, A., Karatepe, O. M., & Okumus, F. (2021). The effect of servant leadership on hotel employees’ behavioral consequences: Work engagement versus job satisfaction. International Journal of Hospitality Management, 97(June), 11. https://doi.org/10.1016/j.ijhm.2021.102994
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Prasetyo, N. et al. (2021) ‘What affects employee performance through work motivation’, Journal of Management Information and Decision Sciences, 24(1), pp. 1–14.
Pulungan, Z. K. and Andika, R. (no date) ‘Effect of Compensation , Work Environment , and Teamwork on Employee Loyalty of PT Agung Berkat Bintatar Abadi’, pp. 99–112.
Rapsanjani, A. and Johannes, S. (2019) ‘The Effect of Remuneration , Work Motivation and Job Satisfaction on Employees Performance’, 2(2), pp. 23–29.
Ratnawati, S. (2020) ‘International Journal of Multicultural and Multireligious Understanding the Oil and Gas Industry’, International Journal of Multicultural and Multireligious understanding, 1(April), pp. 145–152.
Rohim, A. and Budhiasa, I. G. S. (2019) ‘Organizational culture as moderator in the relationship between organizational reward on knowledge sharing and employee performance’, Journal of Management Development, 38(7), p. 11. doi: 10.1108/JMD-07-2018-0190.
Saldanha, E. D. S. et al. (2022) ‘The Impact of Job Insecurity on Job Performance through Job Engagement in Hotel Industry During Covid-19 Period’, 4(2020), pp. 20–32.
Saputra, F. and Mahaputra, M. R. (2022) ‘Effect of Job Satisfaction, Employee Loyalty and Employee Comment on Leadership Style (Human Resource Literature Study )’, 3(4), pp. 1–11.
Sudiardhita, K. I. et al. (2018) ‘The Effect of Compesation, Motivation oF Employee and Work Satisfaction to Employee Performance PT . Bank XYZ ( Persero ) TBK.
Sugiyono, P. D. (2012) Metode Penelitian Bisnis. 16th edn. Edited by P. D. Sugiyono. Indonesia: Alfabeta Bandung.
Taba, M. I. (2018) ‘Mediating effect of work performance and organizational commitment in the relationship between reward system and employees’ work satisfaction’, Journal of Management Development, 37(1), pp. 65–75. doi: 10.1108/JMD-11-2016-0256.
Umar, A. (2014) ‘Effect of Wages , Work Motivation and Job Satisfaction on Workers ’ performance in Manufacturing Industry in Makassar City’, 6(5), pp. 85–96.
Veloso, C. M., Sousa, B., Au-Yong-Oliveira, M., & Walter, C. E. (2021). Boosters of satisfaction, performance and employee loyalty: application to a recruitment and outsourcing information technology organization. Journal of Organizational Change Management, 34(5), 11. https://doi.org/10.1108/JOCM-01-2021-0015
W, M. A. D. I., Armanu, A. and Sudjatno, S. (2017) ‘the Effect of Direct and Indirect Compensation To Motivation and Loyalty of the Employee’, Jurnal Aplikasi Manajemen, 15(1), pp. 25–32. doi: 10.18202/jam23026332.15.1.04.
Wang, C., Xu, J., Zhang, T. C., & Li, Q. M. (2020). Effects of professional identity on turnover intention in China’s hotel employees: The mediating role of employee engagement and job satisfaction. Journal of Hospitality and Tourism Management, 45(July), 13. https://doi.org/10.1016/j.jhtm.2020.07.002
Werdati, F. (2020) ‘The Role of Remuneration Contribution and Social Support in Organizational Life to Build Work Engagement’, 1(2), pp. 20–32.
Yao, Y., Han, T. Y., & Bi, J. W. (2023). The role of employee loyalty in online reputation: evidence from tourism and hospitality sector. International Journal of Contemporary Hospitality Management, (37). https://doi.org/10.1108/IJCHM-03-2023-0409
Abror, A. et al. (2020) ‘Self-efficacy, employee engagement, remuneration and employee loyalty in higher education: The role of satisfaction and Ocb’, International Journal of Advanced Science and Technology, 29(3), pp. 5456–5470.
Acero, I., & Alcalde, N. (2023). The composition of the remuneration committee and the vertical pay gap: the role of proprietary directors in Spain. Baltic Journal of Management, 18(3), 16. https://doi.org/10.1108/BJM-09-2022-0354
Albtoosh, Q., Ngah, A. H., & Yusoff, Y. M. (2022). Training satisfaction relative to turnover intention: the mediating role of employee loyalty. Industrial and Commercial Training, 54(4), 21. https://doi.org/10.1108/ICT-06-2021-0047
Al-Sada, M., Al-Esmael, B. and Faisal, M. N. (2017) ‘Influence of organizational culture and leadership style on employee satisfaction, commitment and motivation in the educational sector in Qatar’, EuroMed Journal of Business, 12(2), pp. 163–188. doi: 10.1108/EMJB-02-2016-0003.
Amstrong, M. (2016) Handbook of human resources management. 10th edn, A Handbook of Human Resources Management. 10th edn. London and Philadelphia: Kogan Page Limited. doi: 10.1007/978-3-662-44152-7.
Aristana, I. N., Arsawan, I. W. E. and Rustiarini, N. W. (2022) ‘Employee loyalty during slowdown of Covid-19: Do satisfaction and trust matter?’, International Journal of Tourism Cities, 8(1), pp. 223–243. doi: 10.1108/IJTC-03-2021-0036.
Ashraf, M. A. (2020) ‘Demographic factors, compensation, job satisfaction and organizational commitment in private university: an analysis using SEM’, Journal of Global Responsibility, 11(4), p. 30. doi: 10.1108/JGR-01-2020-0010.
Aswathappa, K. (2017) Human Resource Management. Seventh Ed. Bangalore, India: McGraw Hill Education (India) Private Limited.
Au-yong-oliveira, M. (2021) ‘Boosters of satisfaction , performance and employee loyalty : application to a recruitment and outsourcing information technology organization Cl’, pp. 1036–1046. doi: 10.1108/JOCM-01-2021-0015.
Bhardwaj, A., Mishra, S. and Jain, T. K. (2020) ‘An analysis to understanding the job satisfaction of employees in banking industry’, Materials Today: Proceedings. Elsevier Ltd., 37(Part 2), pp. 170–174. doi: 10.1016/j.matpr.2020.04.783.
Brandano, M. G., Osti, L. and Pulina, M. (2019) ‘How motivations and satisfaction influence wine tourists’ loyalty? An analysis of the Italian case’, International Journal of Culture, Tourism, and Hospitality Research, 13(1), pp. 55–69. doi: 10.1108/IJCTHR-04-2018-0054.
Dhir, S. (2020) ‘Linking employee loyalty with job satisfaction using PLS – SEM modelling’, 49(8), pp. 1695–1711. doi: 10.1108/PR-03-2019-0107.
Dhir, S., Dutta, T. and Ghosh, P. (2020) ‘Linking employee loyalty with job satisfaction using PLS–SEM modelling’, Personnel Review, 49(8), pp. 1695–1711. doi: 10.1108/PR-03-2019-0107.
Goujani, A. J., Shahin, A. and Isfahani, A. N. (2019) ‘Analyzing the influence of job satisfaction on hostage employee loyalty in Isfahan Province Gas Company’, (2017). doi: 10.1108/BIJ-04-2018-0093.
Gremler, D. D., Riel, A. C. R. Van and Birgelen, M. Van (2019) ‘Effects of perceived employee emotional competence on customer satisfaction and loyalty’, 24(1), p. 20. doi: 10.1108/09564231311304161.
Guillen, M. (2020) Motivation in Organisations, Motivation in Organisations. doi: 10.4324/9780429317293.
Ineson, E. M., Benke, E. and László, J. (2013) ‘Employee loyalty in Hungarian hotels’, International Journal of Hospitality Management, 32(1), p. 9. doi: 10.1016/j.ijhm.2012.04.001.
Jordanian, T. (2023). Predicting turnover intention through training satisfaction data: Keeping employee loyalty topped-up with quality learning experiences. Human Resource Management International Digest, 31(2), 3. https://doi.org/10.1108/HRMID-12-2022-0311
Kajackaite, A., & Sliwka, D. (2020). Prosocial managers , employee motivation , and the creation of shareholder value. Journal of Economic Behavior and Organization, 172, 19. https://doi.org/10.1016/j.jebo.2020.02.021
Kamath, P. R., Pai, Y. P. and Prabhu, N. K. P. (2020) ‘Determinants of recovery satisfaction and service loyalty : the differing effects of service recovery system and service recovery performance’, 30(6), pp. 643–679. doi: 10.1108/JSTP-12-2019-0251.
Kanfer, R., Chen, G. and Pritchard, R. D. (2008) Work Motivation : Past, Present and Future. Edited by P. R.D. et al. New York: Taylor & Francis Group.
Khalfallah, Fatma and Necib, Adel and Saghrouni, O. (2021) ‘The impact of remuneration on staff motivation ( The case of a bank branch )’, (109509).
Khan, A., Kanapathippillai, S., & Dellaportas, S. (2023). Remuneration committees, CEO compensation, skills and retention. Meditari Accountancy Research, 32(2), 23. https://doi.org/10.1108/MEDAR-08-2021-1420
Khuong, M. N. and Tien, B. D. (2013) ‘Factors influencing employee loyalty directly and indirectly through job satisfaction - A study of banking sector in Ho Chi Minh City’, 1(4), pp. 81–95.
Kurniawan, I. S. (2019) ‘Faktor-Faktor yang Mempengaruhi Loyalitas Karyawan’, Sinergi, 8(2), pp. 113–127. doi: 10.20885/sinergi.vol8.iss2.art5.
Kwon, M. and Remøy, H. (2020) ‘Office employee satisfaction: the influence of design factors on psychological user satisfaction’, Facilities, 38(1–2), pp. 1–19. doi: 10.1108/F-03-2019-0041.
Lee, B. et al. (2022) ‘Analyzing Determinants of Job Satisfaction Based on Two-Factor Theory’, Sustainability (Switzerland), 14(19), pp. 1–19. doi: 10.3390/su141912557.
Lee, Y., Kim, S., Day, C. B., Swanson, E. M., & Kim, E. (2021). The expatriate and local hotel general managers : differing approaches to employees ’ loyalty sharing efforts. https://doi.org/10.1108/IJOEM-03-2020-0278
Li, W., Ahmed, T., Xuhui, W., Maitlo, Q., Ullah, A., & Ahmed, N. (2020). Unlocking employees ’ green creativity : The effects of green transformational leadership , green intrinsic , and extrinsic motivation. Journal of Cleaner Production, 255, 120229. https://doi.org/10.1016/j.jclepro.2020.120229
Licata, J. W. (2009) ‘The effects of stake , satisfaction , and switching on true loyalty : a financial services study’, (Clv). doi: 10.1108/02652320910968340.
Linz, S., Good, L. K. and Busch, M. (2015) ‘Promoting worker loyalty : an empirical analysis’, 36(2), pp. 169–191. doi: 10.1108/IJM-06-2013-0129.
Liu, J. da C. (2018) ‘Impaktu Motivasaun ba Loyaldade Servisu Staff iha Novo Turismo Resort and SPA’, Hospitality Review, p. 25.
Mardanov, I. (2020) ‘Intrinsic and extrinsic motivation, organizational context, employee contentment, job satisfaction, performance and intention to stay’, Evidence-based HRM, 9(3), pp. 223–240. doi: 10.1108/EBHRM-02-2020-0018.
Matzler, K. and Bozen-bolzano, L. U. (2006) ‘The Relationship between Interpersonal Trust , Employee Satisfaction , and Employee Loyalty The Relationship between Interpersonal Trust , Employee Satisfaction , and’, (December). doi: 10.1080/14783360600753653.
Mugira, A. (2022) ‘Leadership Perspective Employee Satisfaction Analysis’, AKADEMIK: Jurnal Mahasiswa Humanis, 2(3), pp. 127–135. doi: 10.37481/jmh.v2i3.477.
Noviani, E. (2021) ‘the Importance of Providing Motivation To Bring Work Spirit That Impact on Increasing Performance’, AKADEMIK: Jurnal Mahasiswa Ekonomi & Bisnis, 1(2), pp. 49–58. doi: 10.37481/jmeb.v1i2.219.
Ozturk, A., Karatepe, O. M., & Okumus, F. (2021). The effect of servant leadership on hotel employees’ behavioral consequences: Work engagement versus job satisfaction. International Journal of Hospitality Management, 97(June), 11. https://doi.org/10.1016/j.ijhm.2021.102994
Perkins, S. J., & Shortland, S. (2023). Reviewing executive remuneration decision-making and reporting: implications for theory and practice. Journal of Organizational Effectiveness, 17. https://doi.org/10.1108/JOEPP-08-2023-0334
Prasetyo, N. et al. (2021) ‘What affects employee performance through work motivation’, Journal of Management Information and Decision Sciences, 24(1), pp. 1–14.
Pulungan, Z. K. and Andika, R. (no date) ‘Effect of Compensation , Work Environment , and Teamwork on Employee Loyalty of PT Agung Berkat Bintatar Abadi’, pp. 99–112.
Rapsanjani, A. and Johannes, S. (2019) ‘The Effect of Remuneration , Work Motivation and Job Satisfaction on Employees Performance’, 2(2), pp. 23–29.
Ratnawati, S. (2020) ‘International Journal of Multicultural and Multireligious Understanding the Oil and Gas Industry’, International Journal of Multicultural and Multireligious understanding, 1(April), pp. 145–152.
Rohim, A. and Budhiasa, I. G. S. (2019) ‘Organizational culture as moderator in the relationship between organizational reward on knowledge sharing and employee performance’, Journal of Management Development, 38(7), p. 11. doi: 10.1108/JMD-07-2018-0190.
Saldanha, E. D. S. et al. (2022) ‘The Impact of Job Insecurity on Job Performance through Job Engagement in Hotel Industry During Covid-19 Period’, 4(2020), pp. 20–32.
Saputra, F. and Mahaputra, M. R. (2022) ‘Effect of Job Satisfaction, Employee Loyalty and Employee Comment on Leadership Style (Human Resource Literature Study )’, 3(4), pp. 1–11.
Sudiardhita, K. I. et al. (2018) ‘The Effect of Compesation, Motivation oF Employee and Work Satisfaction to Employee Performance PT . Bank XYZ ( Persero ) TBK.
Sugiyono, P. D. (2012) Metode Penelitian Bisnis. 16th edn. Edited by P. D. Sugiyono. Indonesia: Alfabeta Bandung.
Taba, M. I. (2018) ‘Mediating effect of work performance and organizational commitment in the relationship between reward system and employees’ work satisfaction’, Journal of Management Development, 37(1), pp. 65–75. doi: 10.1108/JMD-11-2016-0256.
Umar, A. (2014) ‘Effect of Wages , Work Motivation and Job Satisfaction on Workers ’ performance in Manufacturing Industry in Makassar City’, 6(5), pp. 85–96.
Veloso, C. M., Sousa, B., Au-Yong-Oliveira, M., & Walter, C. E. (2021). Boosters of satisfaction, performance and employee loyalty: application to a recruitment and outsourcing information technology organization. Journal of Organizational Change Management, 34(5), 11. https://doi.org/10.1108/JOCM-01-2021-0015
W, M. A. D. I., Armanu, A. and Sudjatno, S. (2017) ‘the Effect of Direct and Indirect Compensation To Motivation and Loyalty of the Employee’, Jurnal Aplikasi Manajemen, 15(1), pp. 25–32. doi: 10.18202/jam23026332.15.1.04.
Wang, C., Xu, J., Zhang, T. C., & Li, Q. M. (2020). Effects of professional identity on turnover intention in China’s hotel employees: The mediating role of employee engagement and job satisfaction. Journal of Hospitality and Tourism Management, 45(July), 13. https://doi.org/10.1016/j.jhtm.2020.07.002
Werdati, F. (2020) ‘The Role of Remuneration Contribution and Social Support in Organizational Life to Build Work Engagement’, 1(2), pp. 20–32.
Yao, Y., Han, T. Y., & Bi, J. W. (2023). The role of employee loyalty in online reputation: evidence from tourism and hospitality sector. International Journal of Contemporary Hospitality Management, (37). https://doi.org/10.1108/IJCHM-03-2023-0409
Published
2024-07-23
How to Cite
Godinho, C., Ribeiro, F., Araujo, E., Carion, L. and Solangia Fonseca, E. (2024) “The Role of Job Satisfaction and Employee Motivation serves as a Mediating potency within the Remuneration System, Contributing to the Employee Loyalty. A Case Study in Hospitality Industry in Dili”, Timor Leste Journal of Business and Management, 6, pp. 51-62. doi: 10.51703/bm.v6i0.157.
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