The Role of Transformational Leadership on Employee Turnover Intention at Mining Site Employees in Isolated Areas (Hardship Location)

Abstract

This study aims to analyze the influence of Transformational Leadership on Turnover Intention with Psychological Well-being as a mediating variable in employees of a mining contractor company in Murung Raya, Central Kalimantan. The background of this study is driven by the phenomenon of high potential employee turnover caused by the pressure of the work environment in isolated areas without access to communication signals (blank spots) and the perception of psychological contract violations due to changes in work roster policies (reduced leave quota). In conditions of limited facilities and social access, the role of leaders becomes a crucial factor in maintaining mental stability and employee loyalty. This study used a quantitative approach with an explanatory design. The study population was 142 staff employees working at the site, with a minimum sample size of 100 respondents determined using the Simple Random Sampling technique. Data collection was conducted online using a Google Form questionnaire due to the office's paperless implementation. Data were analyzed using the Partial Least Square (PLS)-based Structural Equation Modeling (SEM) method with the assistance of SmartPLS software. The results of this study are expected to empirically prove that the application of a transformational leadership style characterized by idealized influence, inspirational motivation, intellectual stimulation, and individual consideration has a significant positive effect on improving employee psychological well-being. Furthermore, high levels of psychological well-being are expected to mediate the influence of leadership in reducing turnover intention. These findings provide managerial implications that in locations of hardship with limited transactional incentives, a leadership approach that taps into the psychological and emotional aspects is the most effective retention strategy.