Examining work factors after Malaysia’s minimum wage implementation

Abstract

Purpose This study aims to generate novel insights about minimum wage policy implementation through a joint assessment of the mediating roles of work motivation, work engagement and job satisfaction in predicting outcomes such as turnover intention and work engagement. Design/methodology/approach Data were collected from hotel employees in Malaysia using an electronic survey. A total of 239 responses were used in analyzing direct and indirect effects. Findings Results reveal that work motivation, work engagement and job satisfaction significantly mediated the relationship between employee compensation satisfaction and employee turnover intention. Work motivation was found to mediate the relationship between employee compensation satisfaction and employee work engagement. Additionally, work engagement and job satisfaction mediated the relationship between employee work motivation and employee turnover intention. Research limitations/implications Missing data are inevitable in survey research. Due to data missing for some of the demographic questions, the moderating effect of certain demographic characteristics (e.g. sex) could not be assessed. Practical implications Given recent minimum wage policy implementation in Malaysia, it is imperative that Malaysian hotel operators understand to what extent employee compensation satisfaction influences how employees perceived their jobs and to what extent work motivation, work engagement and job satisfaction mediate employee compensation satisfaction and employee turnover intention. Originality/value This study makes a significant contribution to the hospitality compensation research area, specifically regarding the impact of compensation on how employees perceived their jobs after minimum wage implementation.