IMPACT OF INCENTIVE ON STAFF PERFORMANCE

INPACT OF INCENTIVE ON STAFF PERFORMANCE


TABLE OF CONTENTS

Title Page ii

Approval Page iii

Dedication iv

Acknowledgement v

Abstract vii

Table of Contents ix

CHAPTER ONE

1.0 Introduction 1

1.1 Background of the Study 1

1.2 Statement of the Problem 4

1.3 Purpose of the Study 6

1.4 Scope of the Study 7

1.5 Limitation of the Study 7

1.6 Significance of the Study 8

1.7 Definition of Terms 9

References 10

CHAPTER TWO

2.1 Literature Review 11

2.2 Nature of Scope of Staff Welfare 13

2.3 Growth of Staff Welfare 13

2.4 Purpose of Staff Welfare Scheme 20

2.5 Categories of Staff Welfare Services/Types of Fringe Benefits 22

2.6 Disadvantages of Staff Welfare Provision 38

2.7 Summary of Literature Review 43

References 46

CHAPTER THREE

3.1 Research Design and Methodology 48

3.2 Area of the Study 48

3.3 Population of the Study 49

3.4 Sample and Sampling Procedure/Technique 49

3.5 Instrument for Data Collection 50

3.6 Validation of the Instrument 52

3.7 Reliability of the Instrument 52

References 55

CHAPTER FOUR

4.0 Data Presentation and Analysis 56

4.1 Introduction 56

4.2 Testing of Hypothesis 73

4.3 Summary of Result 78

CHAPTER FIVE

Discussions, Recommendation And Conclusions 80

5.1 Discussion of Result/Findings 80

5.2 Conclusion 82

5.3 Implication(s) of the Research Findings 84

5.4 Recommendations 85

5.5 Suggestions for Further Research 87

Bibliography 94


CHAPTER ONE


INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The administration of staff incentives scheme has now become a popular phenomenon of the total personnel policy of any organization. The scheme involves these extra benefits which may not necessarily be money, which emanate from the kind relationship of the employer to the employees, to supplement their usual wages, from time and which are at most times geared purposely towards the enhancement of workers performance in the organization.

This scheme, is very important to both the organization and the employees, from the employer’s point of view, it is anticipated that a good staff employee incentive scheme will induce the employees to work hard and improve their general attitude toward the organization. But for the employee, these benefit represent some additional right such as extra income, additional security or more desirable working conditions that should not require any additional effort.

In business organizations, employers of labour have seen in staff welfare services the ability to invoke commitment and co-operation of the subordinates to contribute more to the achievement of the organizational goals and aspiration. This discovery has led many employers of labour to the introduction of well packaged welfare services, with the sincere belief that a good staff services will induce staff to work hard and improve the general staff morale.

The situation remains relatively the same but for the difference in methods of payment and apparent change in emphasis. The appraisal of the staff welfare scheme are defined as “something of value apart from the agreed regular monetary payment of salaries and wages given to staff”. This will be used as the working definition for this research work.

Staff welfare services exist in all culture and in all organization and had existed at all times. They take different shapes and forms and attracts different names. In recognition of their worker need fulfillment functions, they are variously called “welfare services” “welfare benefits employees” “income” or simply “supplementary, compensation or “pay and non wage remuneration. As non taxable income and expenses, they are beginning to be called “indirect compensation and non tax benefit”.

In the past, they used to be tiny bits and pieces of goodies that occasionally full from the high tables of paternalistic employer i.e when the top management play a fatherly role of the staff.

It should be noted that for the company to achieve its objective her welfare service should be adequate, competitive and tailored towards the real need of the staff. Staff are directly influenced by nature, quality and quality of welfare services offered because they compare themselves with their counterparts in other organizations.

In this research work, workers do prefer increase in welfare services to increases in salaries especially during the period of inflation and rising prices, workers normally get frustrated and dissatisfied when welfare services are inadequate. But if the opposite condition prevails workers have been observed to be satisfied and more committed to give off their best to the achievement of the company’s objectives.

Welfare scheme, is a kind of incentives given in cash or kind aimed at getting the best out of an employee or group of employees. Motivation aims at optimum performance of employees. Many factors have to do with characteristics of the individuals, different people are endorsed with different potentials, training, skills and receptions ability to change. Employees attitude and behaviour are also influenced by their remuneration and other incentive such as prestige, special allowance and retirement benefits. Conditions and environment of work also affect productivity.

Incentive (welfare scheme) can also be a compensation package, reward for performance, staff prefer cash items such as salary, allowances, Christians bonus, or in non cash items such which we call fringe benefits such as giving the product of the organization to the workers, protective clothing, cars with or without driver.


1.2 STATEMENT OF THE PROBLEMS

Often workers or employees are attracted to certain organization not only because of the pay packets that are stated in the advert but also because of the benefits attached to them. Those benefits usually include, housing, transport and medical allowances together with pension or retirement benefits to mention but a few.

These attractions may constitute a considerable objective for which such individuals made-up their mind to serve in each organization. The Spence or reduction in these primary attractions of such individuals into the organization will certainly lower the morale as well as the efficiency of such individuals performance, which will in turn reflect on the organizations productivity.


CORRECTION FROM STATEMENT OF PROBLEM

These dissatisfaction expressed by the staff either on the provision or administration to staff welfare service activities become some serious problem which demand for proper investigation and examination in order to find lasting solution to them, are as follows:

(i) The implementation of staff welfare scheme in the company is not too effective.

(ii) Workers welfare is not taken care of their salary structure or payment is nothing to write home about.

(iii) The management function is not effective as workers or employees show a negative attitude towards their job, that is inadequate responsibility, high rate of absenteeism and indiscipline.

(iv) Also, the flow of communication between the workers and management is inadequate.

(v) Measure to be used in making sue this problems are tackled to enhance productivity.


1.3 OBJECTIVE OF THE STUDY

The objective of this study are as follow:

(a) To determine if any incentive welfare scheme exist in NEPA.

(b) To ascertain whether any of the service rendered by the staff in the company has been withdrawn due to withdrawal of some incentives.

(c) To identify if welfare scheme package is given by NEPA.

(d) To ascertain whether there are other benefits which the staff demanded for effective performance of their job that are not yet provided.

(e) To ascertain the problems if any that is encounter by the company in the administration of welfare services.

(f) To determine the effectiveness of staff welfare programme in National Electric Power Authority as perceived by the staff.

(g) To make recommendation based on this study on how to improve the provision and administration of staff welfare scheme in NEPA Plc Enugu Zone if need be.


1.4 SCOPE OF THE STUDY

The scope of this study covers only a large spectrum of government owned enterprises in Nigeria called NEPA Plc Enugu Zone.

It is hoped that the study of the administration of staff welfare scheme in NEPA will serve as an eye opener to efficient administration of welfare services in other government owned companies in Nigeria.


1.5 LIMITATION OF THE STUDY

A study of this nature cannot be completed without encountering some constraints or limitations, in the course of this research, these constraints range from time, duration posed a limitation, finance, cost to get these materials. Another notable limitation as experienced by the researcher was the un-cooperative and uncompromising respondents.


1.6 SIGNIFICANCE OF THE STUDY

In view of this research work, the beneficiaries are as follows, management, staff and other organization.

MANAGEMENT: The management tends to benefit when this incentives such as special allowance and retirement benefits, prestige, condition and environment of work are provided. Workers are committed to give off their best to the achievement of the company’s objective.

STAFF: - The staff will also benefit when welfare services are introduced in the organization due to the employers sincere belief that a good staff/employee service activity will induce them to work hard and improve general staff morale.

Other organization thus, try as much as possible to attain their corporate objectives by helping their staffs to accomplish their own personal objectives. This they do by setting ups ideal welfare scheme for the benefit of their staff.

1.7 DEFINITION OF TERMS

For the purpose of this research work the following key words are defined as follows:

STAFF: Any person who enters into a (employer in return for wages, salary or other valuable consideration.

ORGANIZATION: It is an act of organizing a body of people, company, school. It is also the structure of relations that exist between positives in a group.

MORAL: This means the moral condition of workers regarding discipline and confidence.

INCENTIVES: These are wages and salaries.

EMPLOYEE: Those employed to work in an organization.

WORK: A task which employee is assigned to perform.

PERFORMANCE: This refers to the execution of carrying out notable worker.


REFERENCES


Armstrong M and Murlis H. (1980), A Hand Book of Salary Administration London Koran Ltd p. 140

Dale Y. (1962), Personnel Management and Industrial Relations 5th (Ed) Englewood p. 213.


CHAPTER TWO


2.1 LITERATURE REVIEW

NATURE AND SCOPE OF STAFF WELFARE

Definition

Staff welfare has been defined variously writers. Armstrong and Mudis defined it as “item in the total package offered to staff over and above salary, which increase their wealth or well being at some cost to the employer. In the words of Yoder Ethel, “it is wide variety of services provided by companies for staff families. But Nwachukwu from his own perspective sees it as “addition entitlements given to staff by management to supplement their wages.

Naylon and Torrington view it as “a volumetric provision on the point of the staff. The definition adopted for this paper however is that of French and several who define it “as something of value, apart from agreed regular monetary payment of salaries and wages given by an employer to a staff.

(M. Armstrong and H. Murlism A Handbook of Salary administration) London: Koran page Ltd 1980, P. 140. Dale Yoder, Ethat, Handbook of Personnel Management and Labour relations (New York: Mcgraw Hill Book 10), 1958 p. 21 C. C. Nwachukwu Personnel management: Concepts and situations. An unpublished research project, University of Ngieria, Nsukka. Naylon and Torrington, Administration of personnel.

Staff welfare have been commonly referred to as staff benefits or services. This distinction here is that benefits are where direct monetary reward accrued to the individual worker e.g pension leave pay and salary advance, while service involve no direct and unidentifiable monetary benefits e,g staff club recreation facilities arrangement of reception hall and Christmas parties, other yet refer to it as fringe benefits.

As mentioned earlier, staff welfare exists in all cultures, even during slave period and in all organization and had existed at all time export that they take different shapes and form and attract different names. It is in the recognition of their workers need fulfillment functions that they are variably called welfare benefits, welfare services, employee income, they are being referred to as supplementary benefits, supplementary compensation or pay, and expenses, they are beginning to be indirect compensation and non tax benefits.

2.2 NATURE AND SCOPE

Although the term staff welfare, in itself implied a voluntary provision on the part of the employers, the administration of the sate benefit schemes and certain legal requirements concerning other benefit upon the employer.

In addition to such obligations, however a large number of companies provide staff services for which there is no legal requirement in the past, they used to be tury bits and pieces of goodies that occasionally feel from the high table of paternalistic employers, hence they are known to be fringe (i.e marginal) benefits.


2.3 GROWTH OF STAFF WELFARE

The growth of staff welfare scheme has been tremendous particularly since World War II and apparently no end is in sight. The expansion is world wide and so frightening that the scheme have been “compared to the mythological animal that immediately grew two heads when one was chopped off from nowhere, it was the leaved era of paternalism that first saw a widespread adoption of such benefits as company housing and company stores. This era did not last long as it fell into disrupt, supposedly as a result of the employee’s/staff desire for industrial adulthood. Alter it was a news era of new paternalism that developed after the depression of the 1930’s and the World War II.

Edwin B. Flippo: Personnel Management (New York: Mc Graw Hill) 1971: p. 549, since then, government legislations staff awareness, unions demand, among others have continued to escalate the development and growth of these benefits.


REASON FOR GROWTH

Flippo in his book summarized the sources of the rapid growth of such programmes as:

(i) Labour Union demands

(ii) Changed employee attitude

(iii) Government requirements

(iv) Competition that forces other employers to mater benefits to attract and keep labour.

(v) Period wage control which freeze wages but permit the offering of services as a substitute for wage increases.

(vi) High company income tax, deductible expenses items of recent, the package has grown hydroheaded in form and monstrous in relative size and in apprehension, that it is beginning to be called the “hidden payroll”.


Managers and employers do not play dominant role in administering all benefit and services and may not do little more than to comply with prescribed public regulation. So, public policy plays a leading role in expanding several important types of fringe provision. It has long emphasized the advancement of economic security and qualified benefits such as public pensions, pail vacations, industrial ill health and accident.

Staff union on the other hand has supported all of these public intentions and has in addition sought paid sick leave, health and welfare activities increased payment to workers etc. the unions have pursued these benefits with vigour for the best interest of their members.

Even though managers and employers may sometimes appear as opposed to all fringe they have invented and advanced on their own. This is in recognition of the fact that many benefits offer possibilities of implementing their policies to improve staff morale, to encourage wide participation and understanding, to reduces absenteeism and to assist staff in identifying their personal goals and interest with those of the organization. Hence, employers have come to regard fringe benefits as costs of production which are charged along with other firms of remuneration.


C. THE COST OF STAFF WELFARE

In many companies today, a substantial proportion of the total labour costs concerns staff welfares, in addition to basic wages or salaries. These benefits in the staffs view, represent an extra income, additional security or

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