The Effect of Reward and Punishment on Employee Performance at CV Sekar Wangi Jaya

Abstract

Employee performance is one of the key factors that supports an organization in achieving its goals. One way to improve it is by implementing a reward and punishment system. Rewards are given as recognition of employees' achievements and contributions, while punishment is applied to strengthen discipline and compliance with company regulations. Initial observation at CV Sekar Wangi Jaya revealed ongoing discipline problems, with around 15% of employees arriving late and several employees leaving the workplace before working hours ended. This study aims to analyze the effect of reward and punishment on employee performance at CV Sekar Wangi Jaya. It uses a quantitative approach with a survey method. The population consisted of 57 employees, all of whom were taken as respondents through a saturated sampling technique. Data were collected using a Likert-scale questionnaire and analyzed through validity and reliability tests, classical assumption tests, multiple linear regression analysis, the t-test, the F-test, and the coefficient of determination (R²). The results show that reward has a positive and significant effect on employee performance (t = 6.046; p < 0.001), and punishment also has a positive and significant effect on employee performance (t = 3.216; p = 0.002). Simultaneously, reward and punishment have a significant effect on employee performance (F = 169.058; p < 0.001). The R² value of 0.862 indicates that reward and punishment explain 86.2% of the variation in employee performance, while the remaining 13.8% is influenced by other factors outside this study. These findings suggest that a well-applied reward and punishment system can serve as one of the strategies to support better employee performance at CV Sekar Wangi Jaya.