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Influence of employee’s remuneration system on workers efficiency in Nigeria Higher institution

Influence of employee’s remuneration system on workers efficiency in Nigeria Higher institution 



Background to the study

The success and survival of any organization is determined by the way the workers are remunerated and rewarded (Lawler, 2003). The reward system and motivating incentives will determine the level of employee’s commitment and their attitude to work. As noted by Dixit and Bhati (2012). Poor incentive packages have been a major factor affecting employer’s commitment and productivity. However, for any organization to achieve its objective in any competitive society, employers of labour must have a thorough understanding of what drives the employees to perform efficiently and reward them accordingly (Muelle, 2011). Besides, employees must be motivated through adequate incentives plans and reward system and this will invariably encourage them develop a proactive and have a right attitude to work. Thereby promoting organizational productivity (Armstrong, 2007). However in highly dynamic organization incentives strategies are developed by employers of labour to ensure that the best brains are retained.

Consequently, productivity can only be enhanced if the employees are well motivated through adequate incentive packages that are well proportional to their performance (Diene and Biswas, 2002, Stolovich et. al, 2004. Michele and Rob, 2008, Mark, 2011). Meanwhile to avoid wrong perception and controversy by the employees, reward system must be clearly communicated to employees with too measurement which will drive the much needed motivational drive in the employees (Hartman, 2011). Incentive propels and influence employees attitude in workplace and as well as stimulate understanding between the employer and the employees which will consequently cumulating into unprecedented performance for both the employees and the organization (Barbara et al, 2003, Heneman, 1992). Employee satisfaction and performance are largely influenced by incentives packages and reward system put in place by the organization.

The administration of staff incentives scheme has now become a popular policy of any organization. The scheme involves this exited benefit which may not necessarily be money, which emanates from the kind relationship of the employer to the employees, to supplement their usual wages, from time and which are not 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 employers point of view, it is anticipated that a good staff employee incentive scheme will induce the employee to work hard and improve their general attitude towards the organization but for the employee, these benefits represents some additional right such as job security and free health facilities or more desirable working conditions that should not require additional efforts.

In business organizations, employers of labour have seen the importance of welfare services as an inducement to boost the morals and commitment of the employee; this will consequently contribute immensely to the achievement of the organizational goals and aspiration (Armstrong, et. al, 1980).

The discovery and implementation by employers of labour in form of welfare services, with the belief that a good welfare package will induce staff to work hard and boost the general staff moral and achievement of organizational goals.

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 can be defined as “something of value apart from the agreed regular monetary payment or wages and salaries given to staff”. (Daley, 1962) 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 attract different names in recognition of the workers need fulfillment functions, they are variously referred to as “welfare packages” or employee welfare benefit income and expenses. They are being referred to as “indirect compensation and non-tax benefits”

In the past they were peanuts and pieces or goodies that occasionally fall from the high tables of paternalistic employer i.e. when the top management plays a fatherly role for the staff (Armstrong et al, 1980).

It should be noted that for any company to achieve its objectives, her welfare service should be adequately competitive and trailed towards the real needs of the staff. Staffs are directly influenced by nature, quality and quality of welfare services offered because they compare themselves with their counterparts in other organizations, (Armstrong et al 1980).

In most case, workers do prefer increase in welfare services in salaries especially during the period of inflation and rising price. 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 contribute 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 employees. Motivation aims at optimum performance of employees. Many factors have to do with characteristics of the individuals different people are endowed with different potentials, training, skills and receptions and ability to change (Dale y 1962) Employees attitude and behaviour are also influenced by their remuneration and other incentives such as prestige, special allowance and retirement benefits, conditions and environment of work also affect productivity.

Incentives (welfare scheme) can also be a compensation packages, reward for performance, staff prefer cash items such as salary allowance, Christmas bonus or non-cash items sometimes referred to as fringe benefits such as giving the product of the organization to the workers protective clothing, cars with or without driver, (Dale Y. 1962).

In educational system, the art of teaching ordinary brings satisfaction to the teacher and the students. Imparting knowledge gives psychological upliftment and inner joy to all parties involved. It has however been observed that this eternal joy of the teacher’s is being eroded over time with incessant strikes, lock out, work to rule, non-payment of salary and allowances, compulsory and untimely retirement, delay of promotion and stagnation, the yoke of a teacher is manifold and burdensome. (Cole 2002) This study therefore examines the place of reward system on employee’s performance in Nigeria educational sector.

Organization provide rewards to members in the form of wages and salaries, promotions, long service awards and certificate, end of the year bonus and other infringe benefits. These rewards are to motivate behaviour that will contribute to the achievement of the goals of organizations (Cole 2002). The questions that readily come to mind are; what sort of behaviour does an organization want? How can reward process promote that behaviour? What motivates an organization to design reward packages for the employees? Nearly all organizations invest in the provision of rewards to motivate their employees in order to get the desired results.

According to equity theory, the adequacy of such reward will in the form of education, experience, training, time, effort etc. with the outcomes (rewards) they receive as a result of performing the job (fajana, 2002). Individuals who feels that they are being rewarded inequitably are unlikely to be highly motivated to perform effectively and are much more prone to stay away from work (absenteeism) or to leave the organization together (turn over) (Maduabum, 2006). This could spell doom for the organization. If the rate at which people are leaving the organization is high, the organization must investigate the underlying causes and maybe a function of employer’s negative attitude, how job satisfaction and the state of the labour market (perry et. al, 2006).

The institution needs workers to work willingly towards achieving organizational goals willingness to work however depends on how well the employer integrate the interest and needs of the employees with the objectives of the school. How to motivate employees in the school system plays a very significant role of a good leadership. Lack of motivation would hamper performance, because of stress, discomfort, frustration, all of which subsequently reduce student’s quality output (Odden, 2000).

According to behavioural scientists, people work because of the need to attain a number of goals to satisfy certain needs or motives and teachers are no exception (Adelabu, 2003). The overall aim of reward system is to support the attainment of the organization to ensure that it has the skilled, committed and well-motivated work force.

In a school system, it is necessary for the administrator to develop the most suitable incentives and goal reward system which could be financial and non-financial. Teacher motivation for efficient performance in our education system has not always received due attention despite the obvious leading roles they play in the classroom toward attaining educational objectives (Cole, 2002). This situation has remained a very serious problem.

Furthermore, in-consistence in governmental policies such as non-payment of lecturers allowances, embezzlement of lecturers pension fund, and non-inclusion of lecturer in loan service award programme have been said to be responsible for the poor performance or lecturers at work.

The above discussions have shown that remuneration system serves as an impetus for a positive attitude of employees to work. On the basis of the foregoing, this study intends to investigate the influence of employer’s remuneration system on workers efficiency in Nigeria high institution.

Statement Of The Problem

The performance of organization and employee motivation has been the focus of intensive research effort in resent times. How well an organization motivates its workers in order to achieve the mission and vision is of paramount concern. Employees in both public and private sector organization are becoming increasingly aware that motivation increases productivity. From the foregoing, and looking at today economic trend, it is evident that the pace of change in our business environment presents fresh challenges daily.

Some organization over the years see employee as additional cost as well as liability to their operation, hence do not remunerate them appropriately, and where it is more appropriate, the compensation is not commensurate with the efforts and skills that workers put into the organizations activities, instead of paying attention on how employees will be compensated appropriately, some organizations concentrate more on other resources, such as materials, machinery and money. The effort is more on how to improve the production process with little or no consideration for human efforts. This had led to the inability of such organization to attain their set objectives; organizations success relies heavily on the level of attention paid to its employees reward policies. It is in view of this that the study seeks to know the impact of reward and compensation system in organization on the performance of employees as well as that of the organization in general.

Research Questions

In attempt to achieve the stated objectives this research study address the following questions

  • How can fringe benefits or welfare packages and job satisfaction boost the morale of workers?
  • What is the relevance of remuneration to the achievement of organizational goals?
  • What motivational strategies should be adopted for the attainment of organizational goals?

Purpose Of The Study

The main aim of this study is to access the influence of employee’s remuneration system on workers efficiency in Nigeria Higher institution and theoretically it is to identify the various motivational incentives and summarize the various view of manager’s on the impact of these incentives on employee.

Research Hypothesis

This study aims at testing the following hypothesis;

H0:     there is significant relationship between employee remuneration and their performance.

H1:     there is no significant relationship between employee remuneration and organization productivity

H0:     there is significant relationship between job satisfaction and employee performance

H1:     there is no significant relationship between job satisfaction and employee performance

Specific Objectives Of The Study

  • To examine the relationship between level of job satisfaction and employee performance
  • To examine the relationship between employee remuneration and achievement of organizational goals
  • To investigate the best motivational strategy to be adopted in attaining the organizational goal.


Significance Of The Study

The main basic assumption of this study is to know the influence of remuneration system on workers efficiency. Also to know the importance of employee remuneration to the job satisfaction of the work force and theoretically it is to identify the various motivational incentives and summarize the various views of mangers on the impact of these incentives on employee.

Practically it will assist practicing manger in understanding the impact of incentives on employee remuneration, hence enabling these elements to be incorporated into policy and objectives of the organization.

  Scope Of The Study

The study “employer’s remuneration system and its influence on workers efficiency in higher institution’” is very stressful to be dealt with because of some militating factors. Sufficient effort will be made to cover some relevant areas.

The study will be examined with data collected from workers in College of Education Ikere-Ekiti State.

Limitation Of The Study

The limitation of the study is that the study shall cover a limited number of workers in the institution.

Another constraint to be faced in the cause of my study is time factor, the time frame at the disposal of the researcher will not permit gathering as much information needed for proper analysis of the study.

Also finance is another limiting factor. Lack of sufficient finance for finding source of information and acquisition of materials for my study. But with this limitation not-withstanding the researcher will try as much as possible to achieve the purpose of the study.  

Definition Of Terms

For the purpose of this research work the following keywords 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 positive in a group.

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

Incentive: These are wages and se1 (2)rvices

Employee: The 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.




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