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The purpose of this paper is to identify the factors which determine the level of public employees' job satisfaction and as result help to have effective and efficient management system in the public sector, in developing countries such as Turkey.

Based on theoretical considerations, a model was proposed linking the employee satisfaction and loyalty (ESL) constructs. The paper exhibits the findings of a satisfaction and loyalty survey of employment factors within the Turkish public sector. The survey was conducted in 2009 and covered 220 employees within the Istanbul Branch of a Social Security Institution in Turkey. A model was developed by including effecting factors of employee satisfaction, their relations and effects of employee satisfaction on employee loyalty. Partial least squares structural equation model was employed to test the model in the public insurance sector in Turkey.

Data analysis reveals that there is a strong relationship between ESL in a branch of a public sector Social Security Institution in Turkey. Training and personal development was found the most effecting factor of customer satisfaction. The study also finds a positive relationship between working conditions and satisfaction.

The paper reveals the relationship between the employee satisfaction and affecting factors in the public sector in Turkey. These factors are developed only incidentally in the public sector in Turkey. Human resource management (HRM) applications such as measuring employee satisfaction, performance development are widely used in private sector. Specifically, in developing countries such as Turkey, these applications are rarely used in the public sector. Therefore, the paper advocates the use of HRM applications in the public sector in a developing country.