Is Your Cup Full? How Does Job Satisfaction Explain the Relationship Between Leadership and Work Performance?

The purpose of this study was to examine the effect of leadership (transformational and transactional) on performance and to determine whether this relationship is mediated by job satisfaction and moderated by the sector. The sample for this study consists of 259 participants working in Portuguese organizations. This is a quantitative, cross-sectional, and correlational study. The mediating effect was tested using hierarchical multiple linear regressions. The moderating effect was tested using the PROCESS macro (Model 1). The results of this study indicate that performance levels are significantly influenced by transformational leadership, contingent rewards, and job satisfaction. Transformational leadership and contingent rewards significantly increase job satisfaction levels. Job satisfaction was found to be the mechanism that partially explains both the relationship between transformational leadership and performance and the relationship between contingent rewards and performance. The sector in which the participant works alters the relationship between leadership (transformational and transactional) and performance, with this relationship being stronger for participants working in the social sector. Additionally, it was found that participants with daily contact with their direct supervisor report a higher perception of transformational leadership. It is hoped that these results will contribute to both the advancement of the literature and organizational practice.