Analysis of Compensation and Motivation on Employee Performance Through Competence at PT PLN (Persero) UID Sumatera Utara

Abstract

This study aimed to analyze the effect of compensation and work motivation on employee performance through competence at PT PLN (Persero) UID Sumatera Utara. This study used a quantitative approach with an associative research design. The population in this study consisted of all employees of PT PLN (Persero) UID Sumatera Utara, totaling 281 employees, while the research sample consisted of 74 respondents determined using the Slovin formula with a 10% margin of error. The sampling technique used was purposive sampling with the criteria that respondents were permanent employees, had worked for at least one year, and did not hold managerial positions. Primary data were obtained through the distribution of questionnaires using a Likert scale. The data analysis technique used was path analysis with the assistance of SPSS version 24.0. The results showed that compensation had a positive and significant effect on competence, with a beta value of 0.315 and a significance value of 0.004. Work motivation had a positive and significant effect on competence, with a beta value of 0.604 and a significance value of 0.000. Compensation, work motivation, and competence also had positive and significant effects on employee performance, with beta values of 0.285, 0.434, and 0.243, respectively. Work motivation was the most dominant variable in influencing competence and employee performance. The results of the indirect effect showed that competence had not become a dominant mediating variable because the direct effects of compensation and work motivation on employee performance were greater than their indirect effects through competence.