Factors Affecting Employee Well-Being: A Mediation Analysis

Abstract

This study examined the influence of job security and flexible working hours on employee well-being in the banking industry, with work engagement serving as a mediating variable. Employee well-being is an important organizational concern because it influences employee motivation, satisfaction, retention, and overall organizational effectiveness. Employees in the banking sector often face demanding workloads, strict deadlines, and challenging service conditions, making well-being a critical managerial issue. The study is grounded in Social Exchange Theory, which suggests that employees reciprocate favorable organizational practices with positive attitudes and behaviors, including higher engagement and improved well-being. A cross-sectional quantitative research design was adopted, and data were collected from 200 banking employees through a structured questionnaire using a five-point Likert scale. The questionnaire measured job security, flexible working hours, work engagement, and employee well-being. The collected data were analyzed using SmartPLS to assess both the measurement and structural models. The findings revealed that job security positively influences work engagement, while flexible working hours also significantly enhance work engagement. Furthermore, work engagement was found to positively affect employee well-being. The mediation analysis indicated that work engagement significantly mediates the relationship between job security and employee well-being, as well as between flexible working hours and employee well-being. The study concludes that supportive organizational practices improve employee well-being both directly and indirectly through enhanced work engagement. The findings provide valuable implications for managers and HR professionals in designing workplace policies that foster employee engagement and well-being in the banking sector.