The retail industry is becoming more functional with the application of Artificial Intelligence (AI). Nevertheless, the impact of AI integration on the performance of the workers is not necessarily direct and relies on such matters as the human aspect. This paper will discuss how introducing AI can affect employee performance in the retail industry, and employee engagement and organisational support will be the two most important moderators. The quantitative research design was chosen and 312 employees of the retail facility were used to gain data on the use of a structured questionnaire. The SPSS was used to perform the analysis of the data with the help of descriptive statistics, the reliability analysis, and correlation, regression analysis, and mediation analysis. The results indicate that the positive impact on the employee performance is high when AI is introduced. This relationship is mediated to some extent by employee engagement and organisational support, which points to the fact that AI enhances the performance primarily through the employee involvement and perceived support. The stronger mediator was identified to be employee engagement. The findings show that AI technologies cannot be effective in enhancing performance on their own since they need to be backed by ethical behaviors, training, and management support. This work is an addition to the existing literature as it serves as an empirical investigation in the retail industry and gives a realistic submission to the managers to apply AI in a humanistic way..