Decoding Employee Loyalty in Hospitality Industry: The Role of Job Satisfaction in Bridging HRM Practices and Retention Intention

© 2025 JETIR September, Volume 12, Issue 9 www.jetir.org (ISSN-2349-5162) JETIR2509046 Journal of Emerging Technologies and Innovative Research (JETIR) www.jetir.org a373 Decoding Employee Loyalty in Hospitality Industry: The Role of Job Satisfaction in Bridging HRM Practices and Retention Intention 1 Prof. Audhesh Kumar, 2 Akash Yadav 1Professor, 2Research Scholar 1&2 Department of Commerce, 1&2 University of Lucknow, Lucknow, India. Abstract: The hospitality industry, noted for high turnover, depends upon pleased & retained efficient employees to ensure high standards of service. This study evaluates how determinants of the workplace affect hospitality personnel's job satisfaction (JS) and retention intention (RI). Using convenience sampling, a structured questionnaire is used to collect data from 290 employees from the hospitality industry (hotels, resorts, restaurants and cafes in Lucknow. The study reveals that PWE, RP, and RS greatly impact JS, which predicts RI as per the path analysis results. Pay policy was the biggest work satisfaction determinant; however, physical work environment doesn't ensure long-term commitment of employees. Results highlight that employers through intensive focus on offering pleasant surroundings, competitive salaries, and enhancing effective leadership it will not only result in satisfaction with the job but also decrease employee turnover. Keywords: Physical Work Environment, Pay Policy, Retention Intention, Job Satisfaction, Hospitality Industry I. INTRODUCTION The hospitality industry is more dependent on its workforce than other industries, as its personnel have immediate contact with visitors. (Lee et al., 2023) As a service sector with active consumer and producer engagement, as hospitality sector is far more reliant on human resources compared other sectors. A beneficial correlation exists between employees' good impressions of their company and an optimistic degree of organisational commitment, which is frequently used to measure job satisfaction. Employees have immediate interaction with consumers in the hospitality sector; therefore, a great degree of contentment among employees helps achieve customer satisfaction. The working atmosphere of a business is arguably its most noticeable and beneficial aspect. Employees might receive a message of brand quality, strength, vibrancy, and excitement from a work environment. (Brown et al., 2008) The employment relations atmosphere may influence satisfaction with work by altering choices of management approach. Staff and customers are directly related in the hospitality sector; an excellent employee happiness rating contributes to a favourable client retention rating. To achieve fulfilment among staff members, it is preferable to have a decent working environment, competitive remuneration, enjoyable interactions with peers, and manageable working hours. (Leong et al., 2022) Positive thoughts are something a worker brings about; their job conditions are commonly understood to be a sign of job satisfaction. Perhaps the most visible and advantageous feature of a business is its working environment. (Nilasari et al., 2024) Employee engages in work continually; if they don't feel fulfilled with their job, it will ultimately have an adverse influence on their mental and physical health. (Heimerl et al., 2020) A diminished level of fulfillment with work has been noted as a factor of elevated turnover, which is attributed to stress and excessive workload. (Herzberg, 1959) highlighted that to achieve high degree of job satisfaction employer must focus on improving hygiene factors and emphasis on motivator factors. (Kaan Namal et al., 2024) (Qureshi & Hamid, 2017) Job satisfaction is characterised as a person's outlook towards their position at work. The degree to which individuals perceive the fundamental components of a work as either beneficial or detrimental. (Spector, 1997) Satisfaction with work is pivotal for every organisation's prospect and talent retention. Employees require a pleasant work environment to complete their assigned duties and obligations. (Colenberg et al., 2021) Creating frameworks for interior layout in spaces and well-being may help the field advance and foster cross-disciplinary interaction. There is a common misconception that the hospitality © 2025 JETIR September, Volume 12, Issue 9 www.jetir.org (ISSN-2349-5162) JETIR2509046 Journal of Emerging Technologies and Innovative Research (JETIR) www.jetir.org a374 business offers the lowest wages, unpleasant working conditions, and the longest hours of any industry. (Andrade et al., 2021) Factors driving job satisfaction, employee interactions, and incentives can fluctuate significantly due to cultural, contextual, and personal variations. It is impossible to generate productivity or to accomplish goals without a staff that is exceptionally engaged. For companies to be productive in attaining their goal, they have in order to draw in and keep workers who are extremely content with their salary and benefits. (Cahill et al., 2015) Establishing sound choices about managing people, fostering satisfaction among staff members, and successfully running corporations all depend on a grasp of workforce views. (Jr, 2018) Without a doubt, among the most important factors in determining the success and effectiveness of any business entity is employee fulfilment. II. Literature Review & Hypothesis Formulation 2.1 Physical Work Environment The working environment of any organisation is important since people work there and are a part of it. (Oyedeji et al., 2025) The physical and architectural arrangements in which fundamental operations of an organisation are conducted in known as the "work environment of employment." (Pimpong, 2023) Both internal as well as external variables can affect an individual's work ethic and, consequently, their level of efficiency. For employees to perform their tasks effectively and fulfil their assigned responsibilities, they require a desirable workplace. (Bangwal et al., 2017) The psychological well-being of employees, such as anxiety and depression, can also be impacted by working environment elements such as improper illumination, noise levels, and space. (Stamolampros et al., 2019) observed that positive workplace environments and corporate cultures play a vital role and are frequently mentioned by employees in their employer assessments.(Gjerald & Øgaard, 2010) The fundamental beliefs that hospitality professionals form regarding significant elements of their workplace, such as clients or colleagues, shape their actions while on the job. (Raziq & Maulabakhsh, 2015) To increase employees' effectiveness and commitment to their work, the business must offer a suitable workplace that meets their expectations. (Wagdi & Sayed, 2023) In essence, a positive work environment exists which gives workforce a sense of fulfilment in their jobs. The literature suggests that an encouraging workplace contributes significantly to increased satisfaction. Based on existing literature, the following hypothesis was formed. H 1: Physical work environment is positively associated with (a) Job Satisfaction & (b) Retention Intention in the hospitality industry. 2.2 Remuneration Policy Many individuals think that among all the industries, the hospitality industry provides low pay, unpleasant working conditions, and long hours. (Yang et al., 2023) Since the pay system underlines the employeremployee connection, it is a crucial tool for growth-oriented businesses to manage and attract talent. The extent of productivity displayed by the workforce of a business is directly proportionate to the extent of achievement that the company achieves, therefore indicating there is an association between employees and their employer. (Raziq & Maulabakhsh, 2015) For several individuals, engaging in challenging employment provides a sense of contentment. (Mahajan & Kumar, 2018) Inversely, for several individuals, substantial remuneration and benefits act as a gauge of fulfilment, among various other factors. (Brown et al., 2008) HRM procedures impact job satisfaction, encompassing contentment, a sense of achievement, and remuneration. Additional pay and incentives based on employee contributions can serve as a powerful motivator for enhancing one's own performance. (Abdullah et al., 2016) Praise and recognition are intrinsic incentives that empower employees while improving the way they perform. Based on existing literature, the following hypothesis was formed. H2: Remuneration policy is positively associated with (a) Job Satisfaction & (b) Retention Intention in the hospitality industry. 2.3 Relationship with Superior The operational efficiency inside an entity depends on the efficiency of supervision, especially within the hospitality business, which is highly client-centric for customer retention. (García-Cabrera et al., 2023) As the work coordinator, the superior must oversee collaboration, set stimulating goals, and give ample opportunities to put together the team. (Setiawan & Sopiah, 2023) The superior must furnish explicit directions and support when an unfamiliar role arises. (Nespoli, 2017) The standard of the connection between supervisors and subordinates has been addressed in connection with supervisory assistance. (Kato & Koizumi, 2024) Assisting subordinates is often perceived as an operational obligation, even though it © 2025 JETIR September, Volume 12, Issue 9 www.jetir.org (ISSN-2349-5162) JETIR2509046 Journal of Emerging Technologies and Innovative Research (JETIR) www.jetir.org a375 ought to be acknowledged as a supervisor's role. (Inayat & Khan, 2021) The two factors that appear to have the strongest correlation with workplace fulfilment correspond to supervisor support and job independence. (Voordt & Jensen, 2023) argues in favour of managers taking action to embrace and promote work-family relations. Based on literature following hypothesis were derived - H3: Relationship with Superior is positively associated with (a) Job Satisfaction & (b) Retention Intention in the hospitality industry. 2.4 Job Satisfaction & Retention Intention Among all the resources in any sector or industry, human capital is more vital as employees are link between the employer and consumers. Especially in hospitality sector in which personnel are closely connected with consumers, and the growth prospects of businesses, whether a hotel, restaurant or cafe, depend upon the employees. The service offered by employees decides the behaviour of consumers, whether to revisit such place again or not, as hospitality sector businesses purely depend upon the revisits and customer retention. (Dziuba et al., 2020) In order to carry out the objective and vision of the company, employees are a crucial component. (Inayat & Khan, 2021) The relevance of job contentment and its connection to employees' retention intention is growing and becoming more complicated and demanding every day. (Gazi et al., 2024) JS can have an impact on employees' levels of dedication to the organisation, absences from work, and turnover. Based on literature following hypothesis is formed – H4: Job Satisfaction & Retention intention are positively associated. III. Research Methodology To investigate the noteworthy relationship between the physical work environment (PWE), Pay Policy (PP), Relationship with superior (RS), with Job Satisfaction (JS) & Recommendation Intention (RI) using a descriptive research approach, this study examines the hospitality sector. Data for the study is collected using a structured survey from the hospitality sector through a 5-point Likert scale. Participants in this study comprise staff members of Lucknow-based cafes, restaurants, and hotels. The questionnaire has received 307 responses, out of which 290 were considered useful after considering normality, missing value and outlier analysis. Considering the literature review, this study proposes a conceptual framework that considers the association between PWE, PP, and RS, as well as how employee conduct and work satisfaction are related and also regarding retention within the present company. Following Hair et al., 2011) recommendations for the use of structural equation modelling, this study uses a sample size of 290, which was selected using convenience sampling. Furthermore, the current sample size of 290 with five constructs PWP, RP, RS, JS & RI, of 20 items combined was deemed to be fit (290 > 20*10 = 200) and above the target level of 10–15 cases per item. The Measures To study the association between determinants of JS in the hospitality industry, bases on literature this study has taken the Physical Work Environment Scale by (Ahmad et al., 2020; Raziq & Maulabakhsh, 2015) with 5 items, Remuneration policy scale by (Nilasari et al., 2024; Ahmad et al., 2020) with 4 items, Relationship with superior scale by (Nilasari et al., 2024) with 3 items, Job satisfaction scale by (Brayfield & Rothe, 1951; Dziuba & Manuela, 2016) with 4 items and self-structured Retention intention scale with 4 items. This study measures the association of PWE, RP, and RS with Job satisfaction & retention intention to give an overview of how these factors influence the actions of employees in the hospitality sector. For the study, this model used questions derived from the following study Table 1 – The variables S. No Variable Source 1 Physical Work Environment (Ahmad et al., 2020; Raziq & Maulabakhsh, 2015) 2 Remuneration Policy (Nilasari et al., 2024: Ahmad et al., 2020) 3 Relationship with Superior (Nilasari et al., 2024) 4 Job Satisfaction (Brayfield & Rothe, 1951; Dziuba & Manuela, 2016) 5 Retention Intention Self-Structured Source: Literature Review © 2025 JETIR September, Volume 12, Issue 9 www.jetir.org (ISSN-2349-5162) JETIR2509046 Journal of Emerging Technologies and Innovative Research (JETIR) www.jetir.org a376 IV. Quantitative Analysis & Interpretation 4.1 Demographic Statistics To analyse the association between PWE, PP, and RS with job satisfaction and its implications on employee behaviour regarding retention with the current employer, this study retrieved information from 296 participants, out of which 290 responses were found fit for the study. This includes 57.58% male respondents and 42.42% female respondents from the hospitality industry in Lucknow. In addition, 45.52 per cent of workers hold a bachelor's degree, followed by 26.20% with a P.G., 15.52 % with an intermediate and 12.76% with a certificate or diploma in the hospitality industry. In terms of pay structure, 38.97% employees have a salary between Rs. 20,000-30000, followed by 26.20 % with Rs. 30,000-40000, 18.62 % with below Rs. 20,000 and 16.21% with above Rs. 40,000 salaries. Concerning the age factor, 56.90% employees were aged between 25-35 years, followed by 28.27% with below 25 years and 14.83% with the age group above 35 years. Table 2 – Demographic Statistics Frequency Percentage Gender Male 167 57.58 Female 123 42.42 Level of Education Intermediate 45 15.52 Graduation 132 45.52 Post Graduation 76 26.20 Diploma / Certificate 37 12.76 Salary Below 20,000 54 18.62 20,000 – 30,000 113 38.97 30,000 – 40,000 76 26.20 Above 40,000 47 16.21 Age Group Below 25 years 82 28.27 25 – 35 years 165 56.90 Above 35 years 43 14.83 Source: Authors' Calculation 4.2 Exploratory Factor Analysis (EFA) Before applying the measurement model, an EFA was performed to identify the underlying factors of Job Satisfaction & Retention Intention. Principal Component Analysis with varimax rotation is used to extract a set of factors in the 20 variables that have communalities > 0.50, which are included in further study for a structured model. Item RI3 reported a higher communalities extraction of 0.859, while JSI reported a lower extraction value of 0.766. The Bartlett's test of sphericity χ² = 4714.506, df = 190, Sig = .000, p-value confirms that variables are correlated enough for factor analysis and KMO measure (0.889), KMO > 0.80 is considered meritorious (Kaiser, 1974) among the variables. For the final analysis, eigenvalues greater than "1" that reported 81.638 percent of the total variance were retrieved after varimax rotation. Table 3 - KMO & Bartlett's Test of Sphericity, factor loadings, CR, AVE & Cronbach’s α. Component CR AVE Cronbach's α 1 2 3 4 5 PWE1 .862 0.944 0.773 0.908 PWE2 .888 PWE3 .881 PWE4 .846 PWE5 .871 RP1 .852 0.919 0.740 RP2 .876 RP3 .876 RP4 .839 RS1 .860 © 2025 JETIR September, Volume 12, Issue 9 www.jetir.org (ISSN-2349-5162) JETIR2509046 Journal of Emerging Technologies and Innovative Research (JETIR) www.jetir.org a377 RS2 .868 0.873 0.696 RS3 .861 JS1 .843 0.916 0.732 JS2 .894 JS3 .860 JS4 .841 RI1 .882 0.941 0.798 RI2 .902 RI3 .886 RI4 .893 KMO Measure of Sampling Adequacy. 0.889 Bartlett's Test of Sphericity Approx. Chi-Square 4714.506 Df 190 Sig .000 Source: Authors' Calculation 4.3 Reliability and validity of the constructs Table 3 represents KMO & Bartlett's Test of Sphericity, factor loadings, CR, AVE & Cronbach’s α. All observed variables (PWE1–PWE5, RP1–RP4, etc.) had substantial factor loadings, ranging from 0.839 to 0.902 (Hair Et al., 2010), above the threshold > 0.70 is considered excellent. Physical Work Environment (PWE), Remuneration Policy (RP), Relationship with Superior (RS), Job Satisfaction (JS), and Retention Intention (RI) are adequately reflected by their indicators. CR values range between 0.873 and 0.944, significantly beyond the permissible level > 0.7. This indicates good construct dependability across all job satisfaction parameters. AVE values range from 0.696 to 0.798, satisfying the requirement for convergent validity as all values of AVE are above > 0.50 (Fornell & Larcker, 1981). All items have great internal consistency, as Cronbach's α value of 0.908. According to (Nunnally and Bernstein, 1994), α > 0.70 is considered adequate, whereas 0.90 or more is considered exceptional. 4.4 The Measurement Model To validate all the constructs under this study CFA, firstly, EFA was performed, and the results were found satisfactory to perform CFA. The CFA model's goodness of fit is measured using multiple indicators as indicated in Table 4 : (Kline, 2023) the ratio of CMIN/DF should be below the recommended value of 3. (Tucker & Lewis, 1973) indicated goodness of fit indices for Tucker & Lewis (TLI), where TLI should > 0.90, GFI & AGFI should be > 0.90, (McDonald & Ho, 2002) CFI should > 0.95 for better model fit. In addition (Klem, 2000), the values of RMR should be < 0.05. And the range of RMSEA should not exceed 0.08. Table 4 represents the fit indices for the proposed model: CMIN/DF = 1.244, which is less than the recommended value of 3 (Kline, 2023). The value of CFI is 0.992 and TLI is 0.990, the value closer to 1 denotes better model fit. In addition, the values of GFI and AGFI are 0.937 and 0.918, respectively, which exceed the threshold limit of 0.90. The values of RMSEA = 0.029 and RMR = 0.028 are within the probable limit of 0.05. Table 4: The Model Fit Values Recommended Criteria CMIN/DF 1.244 Below 3 CFI .992 More than 0.95 GFI .937 More than 0.90 AGFI .918 More than 0.90 TLI .990 More than 0.95 RMSEA 0.29 Below 0.08 RMR 0.28 Below 0.05 Source: Authors' Calculation © 2025 JETIR September, Volume 12, Issue 9 www.jetir.org (ISSN-2349-5162) JETIR2509046 Journal of Emerging Technologies and Innovative Research (JETIR) www.jetir.org a378 Figure 1: Measurement Model Source: Authors' Calculation 4.5 The Results The findings of the path analysis to look into the influence are shown in Table 5 of PWE, RP, RS, on JS & RI in the hospitality industry. The results suggest most of hypothesis H1a, H2a, H2b, H3a, H3b & H4 are accepted, only H1b was rejected as per the path analysis results p-value> 0.05. PWE → JS have a significant positive relationship, as (β = 0.150, p = 0.003) indicates that a conducive workspace boosts satisfaction. (Chandrasekar, 2011; Awan & Tahir, 2015) for any employee, the workspace is important in determining behaviour at work. PWE → RI was statistically insignificant (p = 0.054), indicating that the work environment doesn’t significantly affect the intention of retention with the current employer. (Hausknecht et al., 2009) The work environment affects satisfaction, but it may not significantly determine long-term commitment, indicating that PWE doesn’t influence employees' decision to retain with their current employer. RP → JS & RI are significantly related as pay policy improves both satisfaction (β = 0.146, p = 0.014) and intention to stay with current employer (β = 0.167, p = 0.034). (Milkovich & Newman, 2008; Park & Shaw, 2013) Money works as a motivator element which not only enhances satisfaction but also plays a vital role in determining the decision of retention. In RS → JS & RI, RS was indicated as the most powerful determinant of both job satisfaction (β = 0.242, p < 0.001) and retention intention (β = 0.279, p < 0.001). (Eisenberger et al., 2002; Allen et al., 2003) The behaviour of the superior is closely associated with employees' satisfaction with their job. In JS → RI, Job satisfaction significantly influenced retention intention (β = 0.209, p = 0.016), because workers are more likely to stick with their present company if they are delighted with the multiple states factors that determine job satisfaction. (Judge et al., 2001; Tett & Meyer, 1993) To retain the employees, employers must focus on improving various determinants of Job satisfaction. Table 5: Path Analysis results Hypothesis Path Estimate S.E. C.R. P Value Results H1a JS <--- PWE .150 .050 2.985 .003 Supported H1b RI <--- PWE .128 .066 1.926 .054 Rejected H2a JS <--- RP .146 .060 2.451 .014 Supported H2b RI <--- RP .167 .079 2.124 .034 Supported H3a JS <--- RS .242 .059 4.068 *** Supported © 2025 JETIR September, Volume 12, Issue 9 www.jetir.org (ISSN-2349-5162) JETIR2509046 Journal of Emerging Technologies and Innovative Research (JETIR) www.jetir.org a379 H3b RI <--- RS .279 .080 3.484 *** Supported H4 RI <--- JS .209 .087 2.398 .016 Supported Source: Authors' Calculation V.Discussion & Implications This study investigates the relationship between Relationship with superior (RS), remuneration policy (RP) and physical work environment (PWE) with retention intention (RI) and job satisfaction (JS) in the hospitality industry. In any business, the human workforce is more vital, especially in this sector, as employees here are directly linked to the business's growth prospects. Hospitality industry growth depends upon customer retention and an increased number of visits, which highly rely on employees, as how employees treat the customers in hotels, resorts, restaurants & cafes and the level of service offered by them influences the decision of customers whether to retain and revisit the place or not. The findings indicate that employees' behaviour with their job in hospitality industry is highly influenced by offerings and workplace environment. The environment in which they work highly influences their satisfaction with the job; however, this doesn’t impact their retention intention, as a good workplace can’t guarantee or assure employees' long-term commitment to the present employer. Superiors' behaviour & remuneration policy influence employees' satisfaction with their respective jobs and also determine their behaviour, whether to retain or leave the organisation. 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