Analysis of the Effect of Compensation on Employee Performance With Competence as an Intervening Variable at PT Pelindo Regional 1 Dumai Branch

Authors

  • Zakaria Universitas Pembangunan Panca Budi
  • Maya Macia Sari Universitas Pembangunan Panca Budi
  • Hasrul Azwar Hasibuan Universitas Pembangunan Panca Budi

Keywords:

Compensation, Competence, Performance

Abstract

This study aims to analyze the effect of compensation on employee performance, the effect of compensation on competence, the effect of competence on employee performance, and the role of competence as a mediating variable between compensation and employee performance. This study uses a quantitative approach with the Structural Equation Modeling (SEM) method based on Partial Least Square (PLS) using SmartPLS 4.1.1.2 software. The number of samples in this study was 33 respondents who were permanent employees. The results of the study indicate that compensation has a positive and significant effect on employee performance, compensation has a positive and significant effect on competence, and competence has a positive and significant effect on employee performance. In addition, competence is proven to be able to significantly mediate the effect of compensation on employee performance. This finding indicates that providing appropriate compensation not only improves performance directly, but also indirectly through improving employee competence. The implications of this study emphasize the importance of implementing a performance-based compensation system and competency development as a strategy to improve employee performance optimally and sustainably.

References

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Published

2025-10-27

Issue

2025: Proceedings of International Conference on Islamic Community Studies

Section

Articles

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Copyright (c) 2025 Zakaria, Maya Macia Sari; Hasrul Azwar Hasibuan

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