Retaining talented employees, especially Millennials, is increasingly emphasized in recent years. For Millennials, building a good relationship with leaders might improve their intensions of completing working tasks well and engaging more into their work. Thus, this study used the theory of leader-member exchange (LMX) to predict engagement level of employees in Taiwan. Furthermore, most of employees also intend to stay in the same company if they recognize the organizational values and feel comfortable with organizational culture. This study also aims to exploring whether person-organization fit (PO-fit) has a moderating effect on the relationship between LMX and employee engagement. Besides, the different traits and values of generation X and Millennials are also one main focus in this study. This study intends to find whether the association between LMX and employee engagement is stronger in Millennials than generation X through collecting sample of full-time workers in service industry in Taiwan. This study used quantitative analysis approach to test the hypotheses, and convenient and snowball sampling approach were used to collect sample. The results of statistical analysis showed that LMX quality is positive related to employee engagement, but PO-fit and generational difference do not have moderating effects on the relationship between LMX and employee engagement.

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