Does Workplace Happiness Mediate the Relationship Between Psychological Capital and Employee Engagement? A Moderated Mediation Model

Amidst the growing literature on employee engagement (EE), the interlinkage of psychological capital (PsyCap), employee happiness and perceived organisational support (POS) is scarce. The current study fills this gap by assessing the mediating effect of employee happiness between PsyCap and EE. In addition, the moderating role of POS between PsyCap and employee happiness was examined. Employees working in the information technology (IT) sector in the National Capital Region (NCR) of India were approached to participate in the survey. Finally, 378 responses were found suitable for hypothesis testing and modelling using the partial least squares structural equation modelling (PLS-SEM). The results found an influential mediating role of employee happiness between PsyCap and EE, thus boosting our understanding of the relevant role of positive psychology in organisations. Further, the results depicted that a favourable POS among employees can foster a sense of employee happiness among employees if they are higher in PsyCap.