A Review of Workplace Well-Being and Employee Performance of Public Sector in Malaysia

A Review of Workplace Well-Being and Employee Performance of Public Sector in Malaysia

Ismasuriyati Ismail¹, Wan Kalthom Yahya^2*, Hasnizawati Hashim³

¹Arshad Ayub Graduate Business School, Universiti Teknologi MARA, Shah Alam, Selangor, Malaysia

²Faculty of Business and Management, Universiti Teknologi MARA, Melaka Branch, Alor Gajah Campus, Malaysia

³Faculty of Business and Management, Universiti Teknologi MARA, Pahang Branch, Raub Campus, Malaysia

*Corresponding Author

DOI: https://dx.doi.org/10.47772/IJRISS.2024.814MG0023

Received: 05 November 2024; Accepted: 11 November 2024; Published: 14 December 2024

ABSTRACT

This paper reviews the literature on employee performance in the public sector to understand leadership values, enhance workplace productivity, and reduce absenteeism. The study targets administrative public officials from the Managerial Level in Federal Ministries, excluding top management. Literature gaps are highlighted as the basis for the proposed framework and theories. This study evaluates the link between quality of working life, emotional demands, value-based leadership, and employee performance. This aligns with the Job Demands-Resource (JD-R) Theory, which highlights the impact of job demands and resources on workplace dynamics. By illustrating these links, the framework enhances understanding of how these elements affect employee performance. The constructs will be assessed using a seven-point Likert Scale, which ranges from “Strongly Disagree” to “Strongly Agree”, with data collection and response collection conducted online. The preliminary data will be analysed using SPSS 29.0 and PLS-SEM 4.0, with a basic random sample method. The literature review identifies research gaps in the JD-R theory, emphasising the significance of well-being and motivation as predictors of employee performance. It also highlights the scarcity of empirical studies on value-based leadership’s impact on Malaysian public sector employees. It was concluded that the literature review reveals the importance of studying employee performance in the public sector, representing a new context in Malaysian employee performance research.

Keywords: employee performance, quality of working life, emotional demands, value-based leadership, public sector

INTRODUCTION

According to economist Robert Gordon (Dick-Smythe, 2022), conventional approaches have reduced the country’s productivity. This is due to the 1990s transition from paper, typewriters, and filing cabinets to personal computers, word processing software, spreadsheets, and the internet, which encouraged e-commerce and the free flow of information. This trend will continue until robotics and artificial intelligence (AI) replace routine chores (Dick-Smythe, 2022). Today, workers worldwide are continuously confronted with challenging tasks that affect their performance and efficiency. As stated by Saadouli and Al-Khanbashi (2020), research data over the last few decades has indicated that improvements in technology, leadership, and organisational structure have had a major positive influence on employee performance. Furthermore, changes in the workplace and working conditions have shown a negative impact on employees as well as on organisations (Salas-Vallina, Alegre & Cabrales, 2021). These advancements contribute to a shift in the emphasis of Human Resource Management (HRM) research on employee well-being (Guest, 2017; Huettermann and Bruch, 2019). Therefore, workplace well-being has demonstrated a significant impact on an organization’s overall performance and the health of its workforce.

Background

Creating a healthy workplace requires good leadership and efficient management. Employers must prioritise these areas to have a long-term and beneficial impact on employees’ well-being. The Chartered Institute of Personnel and Development (CIPD) conducted a comprehensive Health and Well-being study in 2018, which uncovered some insightful findings regarding organizational support for mental health. The results indicated that fewer than one-third of the individuals participating in the survey believed that senior leadership within their organizations actively demonstrates support for mental health. This perception is largely based on the actions and attitudes displayed by these leaders. Many respondents expressed concerns about the level of visible commitment from senior leaders towards fostering a mentally healthy workplace environment, suggesting that their contributions may not be as prominent or effective as needed to truly influence workplace culture related to mental health.

According to Lattice’s 2020 State of People Strategy Report, which is derived from a comprehensive survey that involved 570 Human Resource professionals from various regions around the world, indicates that a significant portion of these professionals, nearly 58 percent, recognize emotional exhaustion as their foremost challenge for the year ahead (State of People Strategy Report 2023| Lattice, n.d.). This finding highlights a critical issue that is impacting the workforce and the well-being of those working in human resources on a global scale. Of those, two-thirds identified poor mental health as a factor. As a result of a challenging year, today’s employees are dealing with emotional issues.

As reported by the United States Bureau of Labor Statistics, the average annual absence rate for the year 2018 was recorded at 2.9 percent. This figure represents the percentage of days that employees were absent from work, providing a measure of absenteeism in the workforce during that particular year. The US Bureau of Labor Statistics, commonly referred to as BLS, published a report in 2022 indicating that the average annual absence rate across the various sectors of employment stands at 3.6 percent. When examining this statistic more closely, it is noted that the absence rate within the private sector is slightly lower, recorded at 3.5 percent. In contrast, the public sector shows a higher absence rate, which is reported to be 4.2 percent. This data reflects the trends in employee absences in both sectors and provides insight into workforce participation and attendance levels. Finally, the yearly average absence rate increased by 0.7 percent between 2018 and 2022. Consequently, when employees are missing from work or present but not working, performance may suffer (US Bureau of Labour Statistics (BLS), 2022).

In the Labour Force Survey (LFS) 2022/23, 875,000 employees reported work-related stress, depression, or anxiety, including 338,000 cases reported recently (Hagan-Duckers, 2023). A total of seventeen point one million working days were lost as a direct result of work-related stress, depression, or anxiety over a specified time. This loss translates to an average of 19.6 days for each case reported, illustrating the significant impact these mental health issues have on the workforce. Notably, a substantial 54 percent of all days lost in the working environment can be directly linked to these problems, underscoring the importance of addressing mental health in the workplace to reduce such losses in the future. Human health and social work reported a notably high incidence rate, with 3,530 cases of issues occurring per 100,000 employees. Similarly, the sectors of public administration and defence, as well as compulsory social security, recorded significant figures, with 3,260 cases reported. Education also displayed a heightened occurrence of cases, tallying up to 2,720 per 100,000 employees. These figures indicate that these specific sectors are experiencing significantly higher rates of cases compared to the overall average seen across all industries. From 2019/20 to 2022/23, LFS data showed that the public administration and defence sector reported significantly higher levels of work-related stress, depression, or anxiety compared to the overall industry average. It is crucial to take the issue of poor mental health among public sector employees seriously to maintain and improve work performance.

According to the Statistics Ministry of Human Resources – Series 30 No. 4/2021, the yearly productivity percentage change for 2020 was -5.5, while productivity from 2016 to 2019 showed slight decreases at 3.1, 3.8, 2.4, and 2.3 (Malaysian Ministry of Human Resources, 2021). This reflects a decline in living conditions, competitiveness, and quality of life. Furthermore, the Employment and Labour Statistics Series 30 No. 4/2021 reported that 1,634 employees were terminated for poor performance in 2021 (Malaysian Ministry of Human Resources, 2021). Nonetheless, the former Prime Minister of Malaysia underscored the need for employers to adopt Flexible Working Arrangements for achieving a harmonious work-life balance, including aspects like working hours, location, and methods, in the 2014 Budget speech (Working from Home in Service of Malaysia – MyForesight, 2021). A nationwide survey by the Vase and Digi-X team from January 22 to 29, 2020, involving 1,042 Malaysian respondents, found that 57 percent were “very satisfied” with their jobs, while 40 percent felt unsatisfied and saw room for improvement (Lim, 2020). The survey indicates that Malaysian employees highly value independence and believe a more compassionate workplace would be beneficial (Lim, 2020).

In Malaysia, presenteeism resulted in 7 to 8.5 times more lost days than absenteeism (The Edge, 2018; 2019). Concomitantly, AIA Vitality conducted a comprehensive survey in 2019 that focused on identifying the healthiest workplaces in Malaysia. The findings highlighted some concerning trends in the workforce, revealing that a significant 51 percent of employees reported experiencing stress that was related to their jobs (Press Release: Malaysian Workforce: Sleepless and Overworked? | AIA Malaysia, n.d.). Additionally, the survey indicated that 53 percent of these workers were getting less than the recommended seven hours of sleep each night. This combination of work-related stress and inadequate rest has serious implications, leading to a notable annual productivity loss estimated at 73.3 days for each employee. This data underscores the impact of workplace pressures on employee well-being and overall productivity in the Malaysian work environment. The Malaysian Department of Occupational Safety and Health (2020) reported that from 2005 to 2020, the number of Malaysian employees with emotional and psychological health concerns rose. This includes the requirement to consult employees and Health and Safety Representatives (HSRs) on matters that affect their health or safety, such as work-related stress hazards (Implementing a Work-related Stress Risk Management Process | WorkSafe Victoria, n.d.).

Most of the research on emotional demands and mental health has been conducted in specific occupations, such as healthcare workers (Suh & Punnett, 2020; Kim, Park & Park, 2019; Sohn, Park, Park, Hwang, Choi, Lee & Jung, 2018) and call centre workers (Cho, Kim, Lee, Lim & Jeong, 2019; Lewig & Dollard, 2003). According to Suh and Punnett (2022), emotional demands were ubiquitous throughout the economy, not just in the service or sales sectors, and were more prevalent in precarious employment. Even research using national databases has frequently focused on individuals in the sales and service occupation groups (Chun, Cho, Choi, & Cho, 2020). As a result, research on emotional demands and mental health in healthcare and call centre personnel frequently overlooks important positions and undervalues affected individuals, such as those who interact with customers, patients, students, and clients (Suh & Punnett, 2022). As stated by Suh and Punnett (2022), emotional demands were ubiquitous throughout the economy, not just in the service or sales sectors, and were more prevalent in precarious employment.

Effective employee performance is crucial for the success of both public and private organisations (Lorincová, Štarchoň, Weberová, Hitka & Lipoldová, 2019). Nevertheless, for government employment in many developing countries, the relationship between the factors and employee performance remains unclear (Saadouli & Al-Khanbashi, 2020). Furthermore, governments and public managers confront significant challenges in improving the performance of the public sector (Asif & Rathore, 2021). Civil servants were besieged by public anger with the level of public service delivery, which was perceived to be routine and ineffectual (Ammons, 2019). Similarly, in Malaysia’s public sector, promotions are based on seniority or time (Aziz, Muzlan, Ahrari, & Zixuan, 2022). Employees who reach a certain point will eventually be promoted, even if they only meet the fundamental job requirements (Asaari, Desa & Subramaniam, 2019). As a result, it causes unhappiness among exceptional personnel.

According to data from the Organisation for Economic Co-operation and Development (OECD) and the Department of Statistics Malaysia, Malaysia’s Gross Domestic Product (GDP) in 2018 was only 35.7 percent of that of developed countries. This statistic underscores a significant challenge facing the nation: the persistently low levels of labour productivity. This issue is further emphasized in the Shared Prosperity Vision 2030 report, which aims to elevate Malaysia’s economic performance and enhance the quality of life for its citizens (Shared Prosperity Vision 2030, 2019). It is supported by a statement made in March 2019 by the President of the Congress of Unions of Employees in the Public and Civil Services (CUEPACS), who indicated that 20-30 percent of civil officials experience mental stress, with several requiring psychiatric care (Mahdi, Bakri & Unin, 2021). Employees with poor mental health are seven times more likely than those with good mental health to be unproductive (Bubonya, CobbClark, & Wooden, 2017).

Finally, the goal of this study was to cover a broad variety of vocations (Administrative Civil Servants) that may involve interaction with clients, regardless of precise occupational classification or job status. Furthermore, employee performance is crucial for achieving organisational goals and improving productivity, efficiency, and working conditions. Overall, managing employee performance through factors such as quality of working life, leadership style, and emotional demands is crucial for achieving individual and organisational goals and improving performance.

Problem Statement

Given the study’s context, it is critical to evaluate how improving the quality of working life, managing emotional demands, and applying value-based leadership might lead to improved workplace performance. In addition, it is critical to explain the study objectives and problem statements developed to improve employee performance among civil servants. Malaysia’s Ministry of Human Resources (2021) reported a decline in living standards, competitiveness, and quality of life in 2021, as well as 1,634 job terminations due to poor performance. This concerning assessment highlighted not only the diminished prosperity but also the challenges facing the workforce. However, the data made no distinction between the private and public sector. Low productivity has become an issue, especially in Malaysia. Thus, this highlights the importance of resolving HRM issues in the workplace to create a healthy and enjoyable working environment. By doing so, organisations can cultivate a work environment that is not only healthy but also enjoyable for all employees. Addressing these issues is essential for creating a positive atmosphere that enhances overall employee satisfaction and productivity. Similarly, research has shown that sustainable HRM practices can boost employee performance by providing valuable workplace resources (Lu, Zhang, Yang, & Wang, 2022).

Therefore, value-based leadership is becoming increasingly popular in the modern period, as businesses must always strive to serve and advance the interests of their stakeholders (Chang, Budhwar & Crawshaw, 2021). Despite the importance of this leadership, the concepts are still poorly understood from a behavioural standpoint, and they are typically described in ways that only explain their significance to stakeholders (Hoch, Bommer, Dulebohn, & Wu, 2018). Furthermore, leadership practitioners and scholars began to understand the importance of strong moral and ethical leadership values in ensuring organisational sustainability (Sumanasiri, 2020). This boosted the appeal of the value-based leadership paradigm among academics and practitioners.

Furthermore, in March 2019, the President of the Congress of Unions of Employees in the Public and Civil Services, known as CUEPACS, highlighted a concerning issue regarding the mental well-being of civil officials. According to his observations, it was reported that between 20 to 30 percent of these civil officials are grappling with significant mental stress. This situation appears to be serious enough that a considerable number of these individuals find themselves in need of psychiatric care to address their mental health challenges (Mahdi, Bakri, & Unin, 2021). This unresolved situation was not taken seriously, which could lead to despair and a setback in productivity.

According to a survey, 34 percent of employees, including the self-employed, informal employees, professionals, and service and sales employees, commonly hide their emotions (Suh & Punnett, 2022). Nonetheless, administrative public servants may not have an emotional attachment to their job, but they may face emotionally difficult situations, such as client complaints or rudeness. Finally, given that many studies in this field have been undertaken in the private sector, it is unclear to what extent the public sector experience mirrors the private sector experience (Cvenkel, 2020).

As a result, while previous research suggests utilising common work performance components (Carpini & Parker, 2017), this study aims to assess how individual-level activities add value to organisations, emphasizing job performance connected to task competency. Thus, this study investigates how the quality of working life, emotional demands, and value-based leadership can influence employee performance in the public sector.

LITERATURE REVIEW

Quality of Working Life and Employee Performance

According to research conducted in the public sector at Halu Oleo University in Indonesia, the quality of working life has had a significant positive effect on employee performance, as indicated by data supplied by education personnel. It has been found that the quality of working life has a direct impact on employee performance in Indonesia’s public sector (Primadani, Winarno, & Ambarwati, 2023). This study is consistent with that conducted by Oktafien, Oktari, and Suhardi (2023). Oktafien et al., (2023) demonstrated that the research indicates a significant relationship between the quality of working life and employee performance, with a positive impact on performance at the Regional Secretariat in the Bandung City Government Environment, in the sense that an increasingly harmonious work environment is always able to have a positive effect on increasing work results displayed by employees while working.

Yadi and Ayuningtyas (2020) discovered a significant relationship between the quality of working life components and employee performance, particularly in terms of employee involvement and participation, as well as the amenities available to employees. Nonetheless, the civil servants’ working conditions at Ogan Ilir District General Hospital in South Sumatera are underestimated, with staff failing to address several issues (Yadi & Ayuningtyas, 2020). Yadi and Ayuningtyas (2020) believe that staff involvement and facility quality are the most important factors influencing performance. Aside from that, other research has indicated that this link may not always be important, like Dewi, Indriati, and Soeling (2020) who discovered that the quality of working life has no positive and substantial effect on employee performance at the Inspectorate General of the Ministry of Trade in Indonesia.

As a result, the significance of the relationship between the quality of working life and employee performance in the public sector may vary depending on the organisational context. Based on past research, a hypothesis can be developed as follows:

Hypothesis 1: Quality of working life is positively related to employee performance.

Emotional Demands and Employee Performance

In the study by Kamassi, Boulahlib, Abd Manaf, and Omar (2019), the findings revealed strong connections between emotional labour (i.e. emotional demands) and administrative staff performance in Malaysian higher education institutions. In particular, the findings demonstrated that doing emotional labour is another tool in the administrative staff’s arsenal for providing effective service to students and visitors (Kamassi et al., 2019). According to research, emotional demands have a significant impact on public employee performance (Duda & Brunetto, 2022; López-Cabarcos, López-Carballeira & Ferro-Soto, 2021; Nainggolan & Pusparini, 2022; Vammen, Mikkelsen, Forman, Hansen, Bonde, Grynderup, Kolstad, Kaerlev, Rugulies & Thomsen, 2019). Therefore, experts advise that future research should focus on the relationship between emotional demands and employee performance among civil servants.

Contrary to the research findings given in the publication by Darman and Adha (2021), emotional demands (i.e. emotional intelligence) have no significant relationship with employee performance in the public sector. Nainggolan and Pusparini’s (2022) study on job demand control and work-family conflict found that emotional demands are indirectly related to employee performance in the public sector. As a result, the studies argue that organisations must ensure effective work processes and a healthy work-life balance for their employees and that leaders play an important role in establishing policies that allow for remote work. After reviewing past research, a hypothesis can be developed as follows:

Hypothesis 2: Emotional demands is positively related to employee performance.

Value-Based Leadership and Employee Performance

The importance of value-based leadership, including authentic, ethical, and servant leadership, is well recognised (Chang et al., 2021). Leadership and burnout have been studied for transformational, ethical, transactional, and servant leadership styles (Arnold, Connelly, Gellatly, Walsh, & Withey, 2017; Hildenbrand, Sacramento, & Binnewies, 2018; Laschinger, Wong, & Grau, 2013; Lee, Chiang, & Kuo, 2019; Ma, Faraz, Ahmed, Iqbal, Saeed, Mughal, & Raza, 2021). The literature has identified a few predictors of burnout, including insufficient social support, organisational politics, workplace bullying, employer unfairness, and leadership (Hildenbrand et al., 2018). Job burnout is a stress reaction with three dimensions: emotional exhaustion, cynicism, and professional efficacy (Maslach, Jackson, Leiter, Schaufeli, & Schwab, 1996; Xie, Li, Zeng & Hu, 2020).

Similarly, ethical leadership, as a subset of value-based leadership, might be easily integrated into future leadership development programs. Many scholars have recognised the importance of ethical leadership, but this understanding has had minimal influence on school leadership, notably in Malaysian public schools (Vikaraman, Mansor, Nor, Alias, & Gurusamy, 2021). Thus, the review was able to support the hypothesis that leaders with value-based leadership behaviours help their organisation improve its performance while enhancing the lives of their followers more than leaders who lack value-based leadership behaviours (Sumanasiri, 2020). Considering past research, a hypothesis can be developed as follows:

Hypothesis 3: Value-based leadership is positively related to employee performance.

PROPOSED FRAMEWORK AND RESEARCH METHODOLOGY

Proposed Framework

Based on the review of extant literature and identified gaps in the current literature, the theoretical framework is proposed by JDR theory as shown in Figure 1.

Figure 1: Proposed Framework for the Study

The JD-R theory (2011-2016) is an expansion of the JD-R model (2001-2010) that draws on work design and job stress theories. Whereas job design theories commonly miss the role of job stressors or demands, job stress models typically overlook the motivating potential of job resources. Furthermore, the JD-R theory combines two theories (job design and job stress theories) to illustrate how job demands and resources have different and additive effects on job stress and motivation. The JD-R theory predicts reversed causal effects: although burned-out employees may create more job demands for themselves over time, engaged individuals mobilise their workplace resources to stay motivated. The JD-R hypothesis allows us to understand, explain, and forecast employee well-being (e.g., burnout, health, motivation, work engagement) and job performance.

According to the JD-R theory, job demands and resources operate as catalysts for two distinct processes: health impairment and motivation, which interact to define occupational well-being (Bakker & Demerouti, 2014). Demands and resources can interact to affect well-being and indirectly influence performance in two ways (Bakker & Demerouti, 2014). The first interaction occurs when job resources operate as a buffer against the effects of job expectations. The second interaction occurs when job demands amplify the impact of job resources on motivation and engagement. Aside from that, the JD-R theory is commonly used to explore how the workplace affects well-being and performance (Bakker & Demerouti, 2017). The JD-R approach is less frequently used to assess work resources such as team atmosphere and leadership (Kaiser, Patras, Adolfsen, Richardsen & Martinussen, 2020).

Finally, the JD-R theory, along with the ideas of well-being and motivation, provides a framework for assessing the impact on employee performance. Therefore, the JD-R theory can help better understand the mutual gains-conflicting outcome conundrum, revealing whether businesses that emphasise employee well-being and organisational goals outperform those that do not. Thus, JD-R theory and SET imply that quality of life, emotional demands, and value-based leadership all have a significant impact on employee performance. Guest (2017) defined the independent variable as Well-Being Oriented Human Resource Management (WBHRM) practices (e.g., quality of working life) based on previous research. Quality of working life is a job resource that improves performance (Salas-Vallina & Alegre, 2021). Meanwhile, Yamin and Mahasneh (2018) discovered that IV has a positive reputation for value-based leadership in the Saudi Health Organisation. Overall, the JD-R theory provides a comprehensive framework for understanding and predicting employee performance.

Research Methodology

This study’s respondents are administrative public officials from the Managerial Level (Grade N41-N56) (excluding top management) in Federal Ministries. The data-gathering method uses self-administered questionnaires based on the theoretical framework’s key elements. The constructs will be operationalized using a seven-point Likert Scale. A 7-point Likert scale ranges from one extreme to another, from “Strongly Disagree” to “Strongly Agree.” The test will be conducted online using the Google Form platform for data collection and response collection. The preliminary data will be analysed using the Statistical Package for the Social Sciences (SPSS) 29.0 and Partial Least Square Structural Equation (PLS-SEM) 4.0. This study used a descriptive study to gather all the necessary feedback, data, and information. A probability sampling method is used in tandem with a simple random sampling method. Randomisation is used to select a sample in quantitative research so that it accurately represents the study population (Kumar, 2014). According to Krejcie and Morgan (1970), the growing need for a representative statistical sample in empirical research has created a necessity for an effective sample size calculation technique. The Krejcie and Morgan table helps researchers find sample sizes for surveys by providing pre-calculated sizes based on population, confidence level, and margin of error. This is particularly helpful for researchers who do not have strong advanced statistical skills, as it eliminates the requirement for complicated formulas (Adam, 2020). This table aids business research by aligning sample sizes with objectives and constraints, thereby enhancing the reliability of findings (Garg, Dhull & Agrawal, 2024). In addition, primary sources will be used in this study.

CONCLUSION

The literature review identifies research gaps that contribute to the development of the proposed theoretical framework and hypotheses. The JD-R hypothesis is applied to well-being and motivation as predictors of employee performance. The gaps in the current literature highlight the importance of quality of working life and emotional demands on employee performance. Assessing factors affecting government employees’ health-related quality of life is crucial. The impact of workplace incivility on job satisfaction, stress, psychological contracts, knowledge sharing, and engagement warrants investigation (Ashri, Saad & Adznam, 2021). Insights into work-life balance management can be gained by understanding how Malaysian public sector personnel organize their work and personal lives (Ibrahim, 2014). Thus, future research could examine the quality of work-life for civil servants in Malaysia. Furthermore, the literature review shows that the impacts of value-based leadership on employee performance among Malaysian public sector’ employees have not been thoroughly studied empirically. Value-based leadership is a nascent field with scant research in academic, economic, and financial studies (Bennedsen & Chevrot-bianco, 2021). Although it can enhance employee performance and job satisfaction, it is frequently misunderstood behaviorally (Hoch et al., 2018). Therefore, this study seeks to enhance Malaysia’s knowledge base, especially in the public sector, and evaluate its impact on employee performance. Finally, the research of value-based leadership as an independent variable in employee performance relationships is innovative and can contribute to the current body of knowledge.

ACKNOWLEDGMENT

The author would like to thank the Arshad Ayub Graduate Business School, Universiti Teknologi MARA for providing support for this study.

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