Sustainable employee performance is defined as an employee’s ability to consistently deliver high-quality work over time while maintaining a satisfactory level of well-being (Ji et al., 2021). This concept goes beyond short-term performance measurement and emphasizes stability, adaptability, and the long-term contribution of employees to organizational goals without compromising their physical and mental health (Nur Fitriany & Wulansari, 2024). Factors that influence it may include compensation, organizational support, and psychological conditions (Afda et al., 2023). Its measurement can be viewed through various dimensions such as quality, quantity, timeliness, independence, and work commitment (Saifullah, 2020).

Work-life balance (WLB) refers to a healthy equilibrium between the time and energy devoted to job responsibilities and personal life (Hartanto & Nawangsari, 2024). It is the individual's ability to commit equally to both work and family roles (Lestari et al., 2024). A good WLB has been proven to increase employee satisfaction and loyalty while reducing the risk of burnout and turnover. Numerous studies support that effective WLB enhances employee performance (Ruslina Candra Putri, 2024; Mujahidin et al., 2023; Aisyah et al., 2023; Sulaeman et al., 2024; Kartini et al., 2023; Nurlaila et al., 2024; Mursham et al., 2022; Jauhar et al., 2022). Moreover, WLB has consistently shown a positive effect on job satisfaction (Maharani et al., 2023; Wirawan & Sukmarani, 2023; Isa et al., 2024).

Based on this review, the following hypotheses are proposed:

H1: Work-Life Balance has a positive effect on Sustainable Employee Performance. H5: Work-Life Balance has a positive effect on Job Satisfaction.

Work stress is a psychological and physical response that arises when job demands exceed an individual's capacity to cope (Salsabilla et al., 2023; Pulungan & Wasiman, 2023). Its causes may stem from task demands, role conflicts, and leadership behavior (Afda et al., 2023; Sari et al., 2023). Poorly managed stress (distress) can negatively impact health, motivation, and performance (Prasetyani et al., 2021). A substantial body of research shows that high levels of work stress significantly reduce employee performance (Hermawan, 2022; Nur Oktaviani & Irmayanti, 2021; Pradoto et al., 2022; Fauziek & Yanuar, 2021; Karim, 2022; Iskamto, 2021; Rijanto, 2023). Furthermore, stress is also a strong predictor of job dissatisfaction (Adinata & Turangan, 2023; Yuridha, 2022; Simarmata, 2021).

Thus, the following hypotheses are formulated:

H2: Work Stress has a negative effect on Sustainable Employee Performance. H6: Work Stress has a negative effect on Job Satisfaction.

The work environment includes all physical and non-physical aspects surrounding employees that can affect task performance (Sunarsi et al., 2020; Mujahidin et al., 2023). Physical aspects involve layout, equipment, and facilities, while non-physical aspects include relationships with colleagues and supervisors, as well as organizational culture (Nurgianto & Akbar, 2023).

A conducive environment has been proven to be a key factor in enhancing performance (Kusuma et al., 2023; Annabawi, 2024; Bintari et al., 2023; Kama et al., 2024; Arbyan & Riyanto, 2023; Pancasila et al., 2023; Suwanto, 2023; Ramadhan & Defrizal, 2024) and job satisfaction (RST et al., 2022; Ishar et al., 2024; Winata et al., 2022).

Therefore, the following hypotheses are proposed:

H3: Work Environment has a positive effect on Sustainable Employee Performance.

H7: Work Environment has a positive effect on Job Satisfaction.

Job satisfaction is a positive emotional state resulting from an individual’s evaluation of their job (Hanawidjaya et al., 2022; Paparang et al., 2021). It is influenced by factors such as salary, promotion, supervision, and coworker relationships (Wirawan & Sukmarani, 2023). Satisfied employees tend to be more motivated, productive, and loyal (Hutasoit & Nawangsari, 2024). Job satisfaction has consistently been found to be a direct antecedent of improved performance (Wieyento, 2022). Additionally, job satisfaction often acts as a psychological mechanism explaining how other factors—such as WLB, stress, and work environment—affect performance. Job satisfaction mediates the relationship between WLB and performance (Fransiska & Maksum, 2023; Priscilla, 2022), work stress and performance (Ariansy & Kurnia, 2022; Yolanda & Salbawati, 2020), as well as work environment and performance (Ende & Firdaus, 2021; Dewi & Mahayoga, 2023).

Based on this, the following hypotheses are formulated:

H4: Job Satisfaction has a positive effect on Sustainable Employee Performance. H8: Job Satisfaction mediates the relationship between Work-Life Balance and Sustainable Employee Performance.

H9: Job Satisfaction mediates the relationship between Work Stress and Sustainable Employee Performance.

H10: Job Satisfaction mediates the relationship between Work Environment and Sustainable Employee Performance.

Based on the development of the hypotheses above, the conceptual framework of this study is illustrated as follows:

Figure 1. Framework of Thought

The data analysis technique used is Partial Least Squares Structural Equation Modeling (PLS-SEM) with the help of SmartPLS software version 4.0. This method was selected for its reliability in analyzing complex and predictive models, as well as its non-reliance on the assumption of normal data distribution, which is often difficult to meet in social science research.

The analysis is carried out in two stages:

Out of 146 valid questionnaires collected, descriptive analysis revealed the following respondent profile. The majority of respondents were male (99%). In terms of age, the largest group was 31–35 years old (45%), followed by 21–25 years (27%).

Most respondents had a senior high school/vocational school (SMA/SMK) education (90%). Regarding work tenure, 60% of the respondents had worked for 1–10 years. The demographic summary is presented in Table 2.

Measurement Model Evaluation (Outer Model)

The outer model evaluation was conducted to ensure the validity and reliability of the research instruments. Initially, several indicators had outer loading values below the 0.70 threshold and were removed from the model. After modification, all remaining indicators had outer loading values above 0.70, confirming convergent validity.

Table 3 presents the final results of the measurement model evaluation. All constructs had Cronbach’s Alpha and Composite Reliability (CR) values above 0.70, indicating high internal reliability. Additionally, the Average Variance Extracted (AVE) for all constructs exceeded 0.50, further supporting convergent validity.

Table 3. Measurement Model Assessment

Discriminant validity was also met, as shown by the Fornell-Larcker criterion and Heterotrait-Monotrait Ratio (HTMT). Table 4 shows that the square roots of AVE (diagonal values) are greater than their correlations with other constructs (off- diagonal values). In addition, all HTMT ratios are below the threshold of 0.90, confirming that each construct is empirically distinct.

Table 4. Discriminant Validity (Fornell-Larcker & HTMT Criteria)

Note: Diagonal values in bold are the square roots of AVE (Fornell-Larcker Criterion). Values above the diagonal are HTMT ratios. Values below the diagonal are inter-construct correlations.

Source: SmartPLS 4.0 Data Output, 2025

The structural model evaluation shows that the model has strong predictive power. The R² value for Job Satisfaction is 0.664 (moderate), and for Sustainable Employee Performance is 0.694 (substantial). This means that 66.4% of the variance in Job Satisfaction is explained by Work-Life Balance, Work Stress, and Work Environment, while 69.4% of the variance in Sustainable Employee Performance is explained by all predictors in the model.

Collinearity diagnostics showed that all Variance Inflation Factor (VIF) values were below 5, indicating no multicollinearity issues. Hypotheses were tested using the bootstrapping procedure at a 5% significance level (p < 0.05). The results are presented in Table 5.

Table 5. Hypothesis Testing Results (Direct and Indirect Effects)

This study clearly demonstrates that work stress is the most detrimental factor to sustainable employee performance at PT KAI (H2 supported; β = −0.300, p = 0.002) and also significantly impairs job satisfaction (H6 supported; β = −0.466, p = 0.000). This significant negative effect aligns with the findings of Kusuma et al. (2023) and Simarmata (2021), which confirm that excessive job pressure undermines emotional and physical stability, ultimately eroding performance.

Interestingly, the impact of stress on job satisfaction is even stronger than its direct effect on performance. This suggests that the emotional effects of stress (reduced satisfaction) occur first, and are then manifested behaviorally in the form of decreased performance. Job satisfaction, in turn, acts as a significant mediator (H9 supported; β = −0.160, p = 0.006), reinforcing the pathway through which stress damages performance. This phenomenon provides a quantitative explanation for the high rate of sick leave noted in the background of this study.

One of the most interesting findings is related to work-life balance (WLB). Directly, WLB does not have a significant effect on sustainable employee performance (H1 not supported; p = 0.108). This is consistent with Ardiansyah & Surjanti (2020), who also reported an insignificant relationship.

However, WLB has a very strong and significant positive influence on job satisfaction (H5 supported; β = 0.396, p = 0.000), which in turn significantly affects performance (H4 supported).

The combination of an insignificant direct effect and a significant indirect effect (H8 supported; β = 0.136, p = 0.009) suggests the presence of full mediation. In other words, the benefits of WLB on performance occur entirely through increased job satisfaction. Employees who can balance their work and personal lives are more likely to feel satisfied, and this emotional satisfaction becomes the main driver of consistent, high-quality performance.

This finding offers a resolution to previously conflicting results in the literature by emphasizing job satisfaction as a key psychological mechanism linking WLB to performance, as also suggested by Priscilla (2022).

The work environment exhibits a mixed impact. This variable shows a positive and significant direct effect on sustainable employee performance (H3 supported; β = 0.164, p = 0.021), which is consistent with Ende & Firdaus (2021), who assert that a supportive environment—such as proper equipment and good interpersonal relationships—can directly facilitate task completion.

However, the work environment does not significantly influence job satisfaction (H7 not supported; p = 0.915), and therefore, its mediating effect is also insignificant (H10 not supported; p = 0.918).

This finding contrasts with studies like Fadlilah & Mirwan (2020) but offers an important insight:

In the context of operational employees at PT KAI, a good work environment may be perceived as a "hygiene factor"—a necessary condition to support work, but not a sufficient one to generate emotional satisfaction. Their job satisfaction appears to be more strongly influenced by psychological factors such as WLB and stress levels.