A fundamental requirement for employee satisfaction is a working environment which allows employees to perform their work at an optimal level, in a conducive and comfortable environment.   The working environment plays an integral role toward employee satisfaction as well as the impact of employee satisfaction on productivity.  A causal study was undertaken to investigate the effect of the working environment has on employee satisfaction and productivity at a shoe manufacturing factory. Five determents of the work environment were considered for the study, which is, working conditions, remuneration, training and career development, fairness of treatment and job stability. A questionnaire was developed and validated using Cronbach Alpha Coefficient (α = 0.928).  Data was collected using simple random sampling to select employees from middle and lower management levels. A total of 212 questionnaires were distributed. Multiple regression analysis and structural equation modelling were used to predict the correlations.   The findings of the study indicated that there is a very strong casual effect between the work environment and employee satisfaction which leads to increased productivity.