Sharia Oikonomia Law Journal, 2. Ae March 2024 1-15 The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (BKD) of Sidoarjo Regency Mochamad Zidny Fithon 1. Riyadi Nugroho 2 Universitas 17 Agustus 1945 Surabaya. Indonesia Universitas 17 Agustus 1945 Surabaya. Indonesia Corresponding Author: Mochamad Zidny Fithon, zidnyfithon3699@gmail. Article Information: Received March 10, 2024 Revised March 19, 2024 Accepted March 27, 2024 ABSTRACT This study aims to analyze the effect of competence, work motivation and compensation on the performance of employees of the Regional Civil Service Agency (BKD) of Sidoarjo Regency. The data in this study used quantitative research methods. In this study, data obtained in the t test . showed that the competency variable had a partial influence on employee performance with a competency regression coefficient (X. value of 2. 823 and a work motivation regression coefficient (X. value of 3. 656 while compensation (X. had a regression coefficient value of 3. The data from Test F obtained f count > f table which is 173. 059 > 2. 80 so that it can be concluded that the variables competence (X. , work motivation (X. , and compensation (X. simultaneously have a positive and significant influence on variables tied to employee performance (Y). It is hoped that this research can be used as a guideline material in decision making for the leadership of the Regional Civil Service Agency (BKD) of Sidoarjo Regency and the government related to variables of competence (X. , work motivation (X. , compensation (X. and employee performance (Y). This research is also expected to be able to provide insight, knowledge, and information about competence (X. , work motivation (X. , compensation (X. , and employee performance (Y) at the Regional Civil Service Agency of Sidoarjo Regency, for students, the community, and also BKD employees themselves. Keywords: Competence. Compensation. Work Motivation Journal Homepage https://journal. id/index. php/jiem This is an open access article under the CC BY SA license https://creativecommons. org/licenses/by-sa/4. How to cite: Fithon. M & Nugroho. The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency. Sharia Oikonomia Law Journal, 2. https://doi. org/10. 55849/solj. Published by: Yayasan Pendidikan Islam Daarut Thufulah Journal Islamic Economic Minangkabau The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency INTRODUCTION In general, an important organization such as a government agency is established with the aim of developing and maintaining the goals of the organization (Doorn, 2. Therefore, the institution must have a plan that is made in a mature and directed manner in various components related to its activities (Aw, 2. One component within the institution that is no less important to develop is human resources (HR). Once the importance of the role of human resources in an institution which is an asset of the institution. In this era of rapid growth of knowledge, development and technology, competent human resources are urgently needed in optimizing expertise in their fields a (Zhang, 2. With the existence of human resources who play a role in accordance with their functions, they will be able to bring the institution to the expected goals (Plevoets, 2. Because the progress or failure of an institution depends on the ability of existing human resources. According to the results of previous research conducted by Ni Kadek Ayu Dwiyanti. Komang Krisna Heryanda. Gede Putu Agus Jana Susila in 2019 with the title "The Influence of Competence and Work Motivation on Employee Performance at PD BPR Bank Buleleng 45" shows that competence has a positive effect on employee performance in PD and work motivation have a positive effect on employee performance in PD. According to previous research also conducted by Wahyu Devi Intan Sari in 2023 with the title "The Influence of Work Discipline. Work Motivation, and Compensation on Employee Performance at Co-Legal Indonesia in Surabaya" shows that work discipline has a significant influence on employee performance variables at Co-Legal Indonesia in Surabaya (Zhang, 2. Then work motivation has a significant effect on employee performance variables at Co-Legal Indonesia in Surabaya. Furthermore, compensation has a significant effect on employee performance variables at Co-Legal Indonesia in Surabaya. Within the institution there must be management in any component. The HR component is no exception (Augustine, 2. According to Hasibuan . 9: . says human resource management is the science and art of managing relationships and the role of the workforce so that it is effective and efficient in helping the realization of company, employee and community goals. HR with the right management will make the institution quality and can be trusted by civil society. Of course the most important factor of quality human resources is the performance factor of its employees. One of the factors that can affect performance is competence. According to Edison. Anwar and Komariyah. , . 6: . competence is an individual's ability to carry out a job correctly and has an advantage based on matters relating to knowledge , skills , and attitude (Dileep, 2. (Wibowo, 2016: . argues that competence is an ability to carry out or perform a job or task that is based on skills and knowledge and is supported by the work attitude demanded by the job. Employee competencies include several competencies such as input-based competencies, transformational competencies, and output competencies (Mikalef, 2. These competencies come from the knowledge, skills and attitudes possessed by employees. In this era of rapid growth of The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency knowledge, development and technology, competent human resources are urgently needed in optimizing expertise in their fields. Then the factor that is no less important than human resource management is the work motivation factor (Shrestha, 2. Work motivation is needed by employees because motivation gives someone a reason to work well in accordance with predetermined procedures, standards and targets (Rahim, 2. Work motivation is a person's encouragement to work, for example, a large salary, a nurturing leader, adequate work facilities, appropriate compensation, a comfortable work environment and pleasant colleagues and others (Ding, 2. Work motivation is related to the effort and encouragement that arises from within a person which is carried out to fulfill all the goals desired by someone so that they reach the intended goal. Employees who are motivated to work will help the performance results of these employees. According to Hasibuan . 7: . , work motivation is an encouragement to direct subordinates to want to work productively to realize the goals that have been set. An equally important effect is compensation. Basically, working people also want to earn money to meet their needs. According to Nawawi . 1: . compensation is a reward/reward to workers who have contributed to realizing their goals, through activities called work. Compensation is a problem that often occurs in small and large companies (Qi, 2. The amount of compensation given to employees can reflect a job or employee contribution given to an institution. Providing appropriate compensation for the wishes of employees and the ability of the institution is able to create a healthy cooperative relationship for the advancement of the institution's performance (Acquier, 2. Compensation is no less important in improving employee performance. Therefore, institutions, especially the government, must provide adequate compensation in the form of income in the form of money, direct or indirect goods that employees receive as a reward for services provided to agencies. The level of HR capability in carrying out its duties and functions requires performance appraisal (Yu, 2. Good performance is an action to achieve the goals of the organization so that efforts are needed to improve performance. (Hasibuan, 2007:. states that performance is the result of work achieved by a person in carrying out the work tasks assigned to him (Petraglia, 2. With performance appraisal, institutions have information to evaluate HR performance for the better. Performance is the result or level of success of a person as a whole during a certain period in carrying out tasks compared to various. possibilities, such as work standards, targets or goals or criteria that have been determined in advance and have been mutually agreed upon. Employee performance is also one of the determining factors for the success of an agency (Phillips, 2. Employees can work well if they have high performance so that their productivity levels are maximized (Leyva-Dyaz, 2. For this reason, employee performance needs to be given more attention from leaders, because if there is a decrease in employee performance it can affect the performance of the institution. The Sidoarjo Regency Regional Civil Service Agency (BKD) is one of the local government agencies that serve Sidoarjo Regency and is located at Jl. Majapahit No. The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency Larangan. Candi. Sidoarjo Regency. East Java (Otoupal, 2. This agency is a regional apparatus that carries out the management of Regional Civil Servants in assisting the main tasks of Regional Civil Service Development Officials (Marshall. The Regional Civil Service Agency is led by a Head of Agency who is under and responsible to the Governor through the Regional Secretary. From the results of initial observations and interviews that have been conducted with several employees of the Sidoarjo Regency Regional Personnel Office, it was found that performance was not optimal because there were several phenomena such as employee competence that was not fully optimal, namely a lack of knowledge or skills (Green, 2. Employee motivation that has not been fully supported, which can be seen from the lack of satisfaction with achievement results, work facilities, and so on, as well as compensation which tends to be unsatisfactory because they are not satisfied with the benefits provided so far and there are no incentives. The urgency of this research is to observe the performance of employees of the Regional Personnel Agency whether it is in accordance with the motto of the institution which reads "Ready to Increase Professionalism with Full Integrity" and also to provide input as well as motivation for employees so that they can survive with their vision and mission and be useful for society, especially residents Sidoarjo. Based on some of the research references, a conceptual research framework is then prepared as follows: Competence (X. Work Motivation (X. Performance of Employees (Y) Compensation (X. Figure 1. Conceptual Framework Based on problem identification, literature review, and conceptual framework, the research hypothesis can be drawn as follows: H1: Competence has a significant effect on the Employee Performance of the Regional Civil Service Agency (BKD) in Sidoarjo Regency. The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency H2: Work Motivation has a significant effect on the Employee Performance of the Sidoarjo Regency Regional Civil Service Agency (BKD). H3: Compensation has a significant effect on the Employee Performance of the Regional Civil Service Agency (BKD) in Sidoarjo Regency. H4: Competence. Work Motivation and Compensation simultaneously have a significant effect on the Employee Performance of the Regional Civil Service Agency (BKD) in Sidoarjo Regency. RESEARCH METHODOLOGY The research used by researchers in this research is quantitative research with a descriptive approach (Renu, 2. The data used in this analysis are primary data and secondary data. The primary data obtained is questionnaire data from BKD employees. While the secondary data obtained is the result of interviews with several BKD employees about the problem to be studied. Data analysis was performed using the Statistical Package for the Social Sciences (SPSS) version 26. In this study, the samples were 51 members of the Sidoarjo Regency BKD employees (Lyu, 2. The sampling technique used is saturated sampling. The data collection method used in this study is the observation method, which is a complex method because it refers to various factors in its operation. In addition, this study also used the questionnaire method, where this method is a data collection technique that is carried out by providing a set of questions or written statements to respondents to RESULT AND DISCUSSION Respondents in this study amounted to 51 employees. Consists of 28 men or 55% percentage and 23 women or 45% of the total (D. Wang, 2. The age distribution of the respondents was 17 people aged 23-33 years or 33% percentage, 34-44 years old 22 people or 43%, 45-55% aged 12 people or 24% of the total number of employees. The length of work of the respondents can be seen from 1-11 years as many as 22 people with a percentage of 43%, while 25 people have worked for 12-22 years or with a percentage of 49%. Then 4 other people have worked for 23-34 years or with a percentage of 8%. Meanwhile, the results of the instrument test which consisted of the results of the validity test showed that the data was valid because it was smaller than the r-table . and the results of the reliability test showed that the data was reliable because the Cronbach alpha > Alpha value, so it can be concluded that the measurement scale on each variable has good reliability. Then the results of the classical assumptions show that the normality test of this study is normal because it shows that the value of Asymp. Sig. -taile. 11 which means this value is greater than 0. The multicollinearity test shows that there is no multicollinearity because the tolerance value is below 0. 10 and the VIF is more than 10. The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency The heteroscedasticity test shows that there is no heteroscedasticity because there is no clear pattern on the picture, and the dots spread above and below the number 0. Furthermore, the results of multiple linear regression analysis can be seen below. Model (Constan. Coefficientsa Unstandardized Standardized Coefficients Coefficients Std. Error Beta Dependent Variable: T. Sig. Table 1. Multiple Linear Regression Test Based on the calculation results of the table above, the multiple linear regression equation can be obtained as follows: Y = 3. 466 X1 0. 248 X2 0. 584 X3 The description of the above equation is as follows: Constant . has a value of 3. 771 which shows that the value of employee performance (Y) is 3. 771 if the factors X1. X2. X3 are equal to zero. The value of the competency coefficient . has a value of 0. 466 which means that the competency variable . has increased by one unit. Therefore, there is an increase in employee performance of 0. 466 or vice versa if there is a decrease in competency by one unit, there will be a decrease of 0. 466 in employee performance at the Sidoarjo Regency Regional Civil Service Agency. The value of the work motivation coefficient . 248, which means that if the work motivation variable . increases by one unit, there will be an increase in the employee performance variable by 0. 248, or vice versa if work motivation decreases by one unit, there will be a decrease of 0. 248 on the performance of employees at the Sidoarjo Regency Regional Civil Service Agency. The value of the compensation coefficient . 584 which means that if the Compensation variable . increases by one unit, there will be an increase in the employee performance variable of 0. Conversely, if compensation decreases by one unit, there will be a decrease of 0. 584 in the performance of employees at the Sidoarjo Regency Regional Civil Service Agency. From the results of the multiple linear regression analysis above, it is explained that the questionnaires given to BKD employees as respondents in this study indicate that competence, work motivation and compensation have a positive influence on the performance of BKD employees. The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency Model Summaryb Model Adjusted R R Square Square Std. Error of the Estimate Predictors: (Constan. X3. X2. Dependent Variable: T. Table 2. Determination Coefficient Test (R. The coefficient of determination (R. Adjusted R square has a value of 0. which means that the effect of the independent variable (X) on the dependent variable (Y) is 91. While the remaining 8. 8% is influenced by other variables outside those not examined in this study (Rahman, 2. Therefore, the results of the test for the coefficient of determination (R. above show that competence, work motivation, and compensation have a significant influence on employee performance at the Sidoarjo Regional Civil Service Agency. Variable t-count t-table Sig Sig Count Competence 2,823 2,011 Work 3,656 2,011 Compensation 3,092 2,011 Table 3. (Partia. t test The table above can be used as a guide in explaining the results of testing the hypothesis in this study, namely as follows: Competency variable t test value on employee performance. Formulation of the H1 hypothesis with the t test as follows: Based on the results of the competency variable t test (X. it can be seen that t-count 2. 823 > t-table 2. 011 with a sig value of 0. 007 <0. 05 then H0 is rejected and H1 is accepted, so it can be concluded that the variable competence (X. has a positive and significant effect on employee performance (Y) at the Sidoarjo Regency Regional Civil Service Agency. The value of the t test variable work motivation on employee performance. Formulation of the H2 hypothesis with the t test as follows: Based on the results of the t test in table 3 work motivation variable (X. it can be seen that t-count 656 > t-table 2. 011 with a sig value of 0. 001 <0. 05 then H0 is rejected and H2 is accepted, then it can be concluded that the work motivation variable (X. has a The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency positive and significant effect on employee performance (Y) at the Sidoarjo Regency Regional Civil Service Agency. The t test value of the compensation variable on employee performance. Formulation of the H3 hypothesis with the t test as follows: Based on the results of the t test in table 3 the compensation variable (X. it can be seen that t-count 092 > t-table 2. 011 with a sig value of 0. 003 <0. 05 then H0 is rejected and H3 is accepted, then it can be concluded that the compensation variable (X. has a positive and significant effect on employee performance (Y) at the Regional Civil Service Agency of Sidoarjo Regency. From the results of the t test above it shows that the questionnaire given to BKD employees as respondents, then it can be concluded that competence, work motivation and compensation partially have a significant influence on the performance of employees of the Sidoarjo Regency Regional Civil Service Agency. ANOVAa Sum of Model Squares Mean Square Regression Residual Total Dependent Variable: T. Predictors: (Constan. X3. X2. Sig. Table 4. F Test (Simultaneou. Based on the results of the F test for competency, work motivation and compensation variables on employee performance variables in table 4, it can be seen that the value of f count > f table is 173. 059 > 2. 80, then H0 is rejected and a sig value 000 is obtained which is smaller than 0. 05 (Rahman, 2. Then H4 is accepted at 5% significance (Axelrod, 2. Therefore, it can be concluded that the independent variables of competence, work motivation and compensation have a significant influence simultaneously on the dependent variable of employee performance. From the results of the F test above, it can be concluded that the questionnaires distributed to BKD employees as respondents indicated that competence, work motivation and compensation simultaneously had a positive and significant effect on the Employee Performance of the Sidoarjo Regency Regional Personnel Agency. The Effect of Competence on Employee Performance Based on the results of this study analysis stated that the competency variable (X. has a partial effect on employee performance (Y) (Guo, 2. This can be seen from the results of the t-count value of 2. 823 > t-table 2. 011 with a sig value of 0. The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency <0. 05 so it can be concluded that the competency variable (X. has a significant influence on employee performance (Y). So it can be said that the first hypothesis reads "Competence has a significant effect on Employee Performance at the Sidoarjo District Civil Service Agency" is in accordance with the results of the study, so the first hypothesis can be accepted. This result also proves that good competence will shape good employee performance as well. If the BKD of Sidoarjo Regency wants to improve employee performance, then it can pay attention to matters related to competence. Based on the results of this study, it can be explained that the competence variable has a positive influence on the dependent variable of employee performance. This can be proven in accordance with the theory according to Edison. Anwar and Komariyah . 6: . "competence is the ability of individuals to carry out a job properly and have advantages based on matters relating to knowledge . , expertise . , and attitude . (Wright, 2. Without the competence of good employees, it is difficult for institutions or agencies to realize the goal itself, namely achieving optimal performance from employees (Bragg-Sitton, 2. So, competence is the success of an institution in achieving its goals. Also supported by research conducted by Ilman Ataunur and Eny Ariyanto . showing that competence has a positive and significant influence on the performance of employees of PT. Adaro Energy Tbk. Effect of Work Motivation on Employee Performance Based on the results of the analysis of this study, it shows that work motivation variables have a partial effect on employee performance (Zhou, 2. This can be seen from the t-count value of 3. 656 > t-table 2. 011 with sig 0. 001 <0. 05, it can be concluded that the independent variable work motivation (X. has significant effect on employee performance (Y), it can be said that the second hypothesis reads "Work Motivation has a significant effect on Employee Performance at the Sidoarjo District Civil Service Agency" is in accordance with the results of the analysis in this study, so the second hypothesis can be accepted (Y. Wang, 2. These results also prove that if work motivation grows well, it will form good employee performance as well, so that if the BKD in Sidoarjo Regency wants to improve the performance of its employees, it is necessary to pay attention to matters related to work motivation. The results in this study are in line with the results in the research conducted by Afandi . 8: . (Abraham, 2. Where work motivation is a desire that arises from within a person or individual because he is inspired, encouraged, and compelled to carry out activities with sincerity, pleasure and earnestness so that the results of the activities carried out get good and quality results (Chandrasekhar, 2. Also supported by previous research conducted by Aldo Herlambang Gardjito. Mochammad Al Musadieq, and Gunawan Eko Nurtjahjono in 2014 concluded that work motivation has a positive and significant effect on employee performance at PT. Karmand Mainstay Partners Surabaya. The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency Effect of Compensation on Employee Performance Based on the results of this research analysis, it shows that the compensation variable has a partial effect on employee performance (Alves, 2. This can be seen from the results of the t-count value of 3. 092 > t-table 2. 011 with a significant value of 003 <0. 05 so it can be concluded that the compensation variable (X. has an influence significantly to Employee Performance (Y) at the Sidoarjo District Civil Service Agency. so it can be said that the third hypothesis reads "Compensation has a significant effect on employee performance at the Sidoarjo Regency Regional Civil Service Agency. " is in accordance with the results of the study, so that the hypothesis is declared accepted. These results prove that the existence of compensation aimed at employees will shape good employee performance, so that if the BKD of Sidoarjo Regency wants to improve the performance of its employees, it is necessary to pay attention to compensation. The effect of compensation on employee performance means that employees will feel valued with compensation conditions that are in accordance with the responsibilities given, if the compensation is in accordance with themselves and does not feel burdened, then when they work they will finish faster, so that with appropriate compensation they are motivated at work, this causes a lot of work to be completed Supported by previous research conducted by Lian Cantika Dwi Pratiwi in 2016 showing that compensation has a positive and significant influence on the performance of employees of Bank Muamalat and BNI Syariah Jember and Banyuwangi branches. The Effect of Competence. Work Motivation. Compensation on Employee Performance Based on the results of the F test above, it shows that competence, work motivation and compensation affect employee performance. This is evidenced from the results of the F test in table 4. 18, it is found that f count > f table, namely 173. 80 and a significant value of 0. 000 is obtained, which is less than 0. 05 at a significant 5%, so it can be concluded that the competency independent variable (X. , work motivation (X. and compensation (X. have a significant effect simultaneously on the dependent variable of Employee Performance. With this competency, work motivation and compensation indicate that there is a positive direction or unidirectional relationship to employee performance, so it can be concluded that if competence, work motivation and compensation increase, employee performance will also increase. Meanwhile, if competence, work motivation and compensation decrease, employee performance will also decrease. This is evidenced by the fourth hypothesis which reads "Competence. Work Motivation and Compensation have a significant effect on Employee Performance at the Regional Civil Service Agency of Sidoarjo Regency" which is stated to be The test results for the Coefficient of Determination (R. were obtained at 912 which shows the effect of the independent variable (X) on the dependent variable (Y) of 91. 2% while the remaining 8. 8% is influenced by other variables outside the The Effect of Competence. Work Motivation and Compensation on the Performance of Employees of the Regional Civil Service Agency (Bk. of Sidoarjo Regency model examined in this study. With the results obtained from the test of the coefficient of determination (R. described above, it shows that the independent variables of competence, work motivation and compensation have a significant effect on the dependent variable of employee performance at the Sidoarjo Regency Regional Civil Service Agency. Supported by research conducted by Raditya Rachman. Sri Rahayu, and Rifda Fitrianty . shows that there is a significant simultaneous influence of competence, compensation, and work motivation on employee performance at PT. Agnes Sugi Makmur Sidoarjo. CONCLUSION Competence has a positive and significant effect on the performance of employees of the Regional Civil Service Agency (BKD) of Sidoarjo Regency. Work motivation has a positive and significant effect on the performance of employees of the Regional Civil Service Agency (BKD) of Sidoarjo Regency. Compensation has a positive and significant effect on the performance of employees of the Regional Civil Service Agency (BKD) of Sidoarjo Regency. Competence, work motivation, and compensation simultaneously have a positive and significant effect on the performance of employees of the Sidoarjo Regency Regional Civil Service Agency (BKD). ACKNOWLEDGEMENT Praise be to God Almighty who has bestowed his mercy and wisdom so that I was given the opportunity to continue my Bachelor of Management Education at the Faculty of Economics and Business. University of August 17, 1945 Surabaya, and completed this thesis with pride. I would like to thank all parties who have helped and guided me in pursuing education and completing this thesis. In writing this thesis. I received a lot of help from various parties. Thank you to the rector, dean, head of study program, supervisor, lecturer guardian. TU staff. BKD employees, my parents, my friends, and myself for being able to fight until now. REFERENCES