Employee engagement was found to have a partial mediating effect on various researches (Saks, 2006; Mendes and Stander, 2011; Karatepe, 2013; Song, 2014). In one particular study of the effects of leader-worker relationship towards turnover intentions, work engagement was found to play a full mediator role (Agarwal, 2012). To explore the mediating role of employee engagement between compensations and retention. Employee retention refers to the means of encouraging employees to remain with the organization for the maximum period of time (Das and Baruah, 2013), in other words, to retain the employee by offering them reasons to stay. Employee retention encompasses all efforts of an organization to retain desirable talents in order to attain organizational objectives (Pregnolato, 2010), while turnover intentions are referred to as the behaviour to quit from the current job (Albattat, 2013). According to the earliest paper for work engagement (Khan, 1990), the term was referred to as the psychological presence of an employee in his job role, being emotionally and cognitively active at work. Later on, work engagement was also appraised by Shaufeli et al. (2002) as a psychological presence defined by a positive, fulfilling, work related state of mind that is categorized by vigor, dedication, and absorption. this research found that financial compensation strongly predicts retention of frontline hospitality employees Non-financial compensations can also affect retention to a certain degree, however, does not have any significant relationship with employee engagement. Also, employee engagement remains strongly correlated to employee retention.