THE EFFECTS OF THE COMPENSATION SYSTEM ON JOB SATISFACTION AND TURNOVER INTENTIONS OF EMPLOYEES IN THE REPUBLIC OF SERBIA

Abstract

The main goal of this research is to examine the relationship between the compensation system, job satisfaction, turnover intentions, and the mediating effect of job satisfaction in the relationship between the compensation system and turnover intention. The main research question relates to determining the effect of the compensation system on turnover intentions and the role of job satisfaction in this relationship. The methodology of the work consists of the theoretical and empirical part of the research. Empirical research was conducted on a sample of 100 employees from organizations operating in the Republic of Serbia. The collection of samples lasted from March to May 2022 through an electronic questionnaire based on which respondents had the opportunity to answer at any time, wherever they were, through their electoral devices. The proposed relationships were tested with the PLS-SEM method, using the SmartPLS software. The main findings of the research indicated that there are direct positive effects of the compensation system on job satisfaction and turnover intention, and that job satisfaction has an indirect effect on the relationship between the compensation system and the turnover intention of employees. Employees who are offered an adequate compensation system do not want to leave their job, and also if the employees are satisfied with the compensation sys, they will not want to leave their job.