As one of the most fundamental aspects in management, the reward and punishment system such as certificates,
promotions, verbal reprimands, and demotions has been used by Indonesia Customs to maintain employees’ motivation
toward delivering excellent performance as public servants. However, there limited studies address the fairness in the
system over time. Therefore, this study aims to identify employees’ perceptions on the fairness of the current system, while
analyzing the employees’ perceived levels of satisfaction and significant aspects that influence the current reward and
punishment system in Indonesia Customs. In addition, the study makes a number of recommendations on how to
strengthen this system.
The research employed mixed methods combining both quantitative and qualitative data. The quantitative data were
collected through online survey questionnaires from Indonesia Customs officers, while the qualitative data were gathered
from focus group interviews with Indonesia Customs officials with experience of the system within the organization.
The findings show that the current reward and punishment system in Indonesia Customs has been fairly and
properly established. The majority of the employees were satisfied with the current system and considered leadership as
the most influential component. However, those employees who had experienced punishment regarded it otherwise.
Finally, suggested recommendations such as the socialization of employees, periodic and sustainable evaluation, and the
periodic monitoring of employees’ satisfaction can strengthen the system to become a more effective mechanism to
enhance the health of the organizational culture.
Keywords : Reward and Punishment System, Employees, Satisfaction, Organizational Culture.