This study aims to examine the effect of employee welfare on employee performance, as well as the role of work loyalty as a mediating variable in companies engaged in rattan woven crafts in West Java province. To achieve the objectives of this study, companies need to pay attention to one of which is the amount of production where furniture production does not reach the target set by the company, this is due to the lack of welfare given to employees which has an impact on employee work loyalty and employee performance. The study was conducted at PT Rotan in West Java province using quantitative methods. Data collection was carried out by distributing questionnaires to employees of PT Rotan in West Java province and analyzed using partial squares structural equality modeling (SEM-PLS) version 4 with a total of 150 employees as respondents. Data processing used includes validity test, reliability test, Sobel test, t test and f test. The results of the study indicate that employee welfare has a positive and significant effect on employee work loyalty and performance. In addition, work loyalty also has a significant effect on employee performance. Mediation testing with the Sobel test shows that work loyalty is able to mediate the relationship between employee welfare and performance significantly. Thus, improving employee welfare not only has a direct impact on performance, but also strengthens loyalty which ultimately improves performance indirectly. This finding provides important implications for company management in designing performance improvement strategies through employee welfare and loyalty policies.
Nisa et al. (Wed,) studied this question.