CHAPTER ONE – INTRODUCTION
Optimal workforce is necessary for any organisation to survive in a competitive environment where efficiency and quality of products is of essence, (Indermun & SaheedBayat, 2013). To retain efficient and experience workforce, employee benefits must be sufficient enough to keep the employee s’ mind at rest whenever they are at work, hence, the productivity of such employee will be at optimal level.
The Nigerian Labour Act, 1990, mandates employers to provide apart from normal wages, pension and leave (sick, maternity and annual) as benefits for the employees. An employee is entitled to at least 6 working days leave, maximum of 12 days sick leave and 12 weeks maternity leave.
The fast food industry is characterised with high labour turnout because of low pay and limited incentive (Tudor, 2011) hence motivating such employees to increase productivity is a daunting task. This is what necessitated this research work to understand those benefits that can improve the productivity of the staff such that the organisational performance can be improved.
One of the pre-requisite for organisational success is to maintain a healthy and vibrant employee’s relationship within the organisation. Recognising employees effort and rewarding such efforts through the attachment of certain benefits to every task or job every employee carry out within the organisation is one way of maintaining a vibrant and healthy employee relationship.
Schick, and Vaughn, (2013) asserted that management can not overlook the numerous non-wage benefits given to employees apart from their normal wage or/and salaries as this goes a long way in showing the employees that are the most valuable asset the organisation has and also fosters good employee relations. The fact that we are in an era of high competitiveness irrespective of the size or technology or market focus of an organisation, has led many organisations to be faced with employee retention challenges according to Alfandi & Alkahsawneh (2014) and Eze (2012).
It is no gainsaying that the strength of any firm usually lies in that organisation’s human resources. It is also a fact that linking a strength that gives an organisation its competitive advantage towards their operations will go a long way in helping such organisation to skirt the threats in its external environment. Where the human resource or employees are well motivated and satisfied, such employees will be able to convince their customers to patronise the organisation’s products and services even in an unfavourable market condition that we are witnessing now. (Aamir et al., 2012)
In order to overcome the employee retention problem, there is a need to create a positive relationship and bonding between the employees and their organisations and this positive relation and bonding should be maintained by the organisation. This positive relationship and bonding could be enhanced through incentives like study allowance, leave allowances, performance and other bonuses like end of year bonus, overtime allowance, free lunch, health insurance and many more non-salaries related benefits so as to influence and persuade these employees towards fulfilling their tasks and targets, (Terera, & Ngirande, 2014; Xavier, 2014).
Xavier, 2014 re-echoed the fact that the most valuable asset of an organisation are the employees due to the important role of preserving the image of their organisations successfully. To main factor in ensuring the successful and smooth running of organisations is employees performance and good employees performance will invariably lead to good organisational performance. A well articulated performance management is therefore required to drive good employee performance (Muhammad, & Maqbool, 2015).
1.2 Background of the study
Different scholars have written on what motivates an employee to work and one of such scholars is Herzberg who proposed two factors namely motivation and hygiene. According to this two factor theory, an organisation needs to have an employees benefit scheme to motivate them and an adequate working environment as a hygiene factor as this will affect workers work-motivation and productivity (Hong, Yang, Wang, Chiou, Sun & Huang, 1995). It is therefore essential that in order to enhance and maintain employees’ satisfaction and increase their commitment, an employees benefit scheme must be put in place.
All countries have their employment laws which makes it mandatory for every employer to provide one form of benefits or another to their employees; e.g. Malaysia employment Act 1955, the Nigerian Labour Act, 1990 and so on. The employer is liable to these compulsory benefits without transferring the cost to the employees, i.e. these benefits must be paid for by the employers as part of the cost of operation. Some companies however provides more fringe benefits beyond those made compulsory by law and these are sometimes more significant to these employees (Tudor, 2011).
S?lceanu, 2013 and Rasheed ; Malik (2012) opined that employees’ benefits which forms a major part of the employees’ total emolument is of great importance to both parties (employee and employer) as the performance of the employees depends on how well they perceive their total emolument as the benefits usually affect the employee’s choice of employment or even the desire to continue to work for the present employer (Amah, 2010). Chih & Zwikael (2015) are also of the opinion that job satisfaction is usually derived from a number and nature of benefits that comes with a job based on what equity the employee perceives and what motivates the employee.
Amah, 2012 went on to affirm that when an employee is well benefitted, such employees would feel valued and hence, be encouraged to put in their utmost best to better their performance being fully aware that their employer takes their well-being including their career development and self development very serious. Ann-Sykes (2015) likens the employees of an organisation to the engine of such organisation’s vehicle while the benefit is regarded as the fuel that propels the engine to work stating that employees are key to an organisation achieving its stated objectives.
Human Resource Managers have always use employee benefits as one of the strategies for attracting and retaining suitable employees. Employee benefits is also used to facilitate performance improvement as well as motivate employees while it helps the employer to comply with employment legislations and regulation as stipulated in various labour laws and regulations. Due to the pressure of complying with employment legislations and regulations, Human Resource managers are developing benefit structures that aligns the organisational strategic goals to the individual employees’ goals.
Having a robust benefit system is very important for any organisation that wants to compete favourably in a competitive environment (Maund, 2001). A benefits system is not just about what is offered to the employees but includes a well defined structure with identified programs and practices that are meant to affect the choices and actions of employees. In other words, a benefit system should elicit positive consequences through a systematic way to attain the desired performance from the employees, hence improved organisational performance (Wilson, 2013).
Kotelnikov (2010), asserts that the in other for employees to fulfil their employers dream, the employer needs to also share in the dream of the employees and one of the ways to share in the employees’ dream is to provide a benefits system that addresses their wants and needs and these wants and needs includes personal recognition and development in form of award of excellence and promotion, development in terms of training and re-assignment, and non-monetary bonuses like holidays and vacation, or just a simple thank you or well done for a job or task well performed. Employees tends to get their work done when they feel they have benefitted from what they have done so far. Employers get more from their employees based on what such employees have benefitted, not from what the employer expect normally from such employee. Therefore, employers needs to motivate employees to perform better through giving them incentives whenever they exceed their targets and standards.
Nassazi, 2013 opined that the major objective of benefit systems is to influence the choice of employees to either accept an employment offer or choose to remain with the employer. It was stressed that when employees perceive the pay conditions to be equitable, then, their performance will improve according to the perceived equity. Organizations uses both financial and non-financial rewards to increase performance. Financial incentives could be in form of overtime pay or bonuses while non-financial incentives could be in the form of transport fee (Armstrong 2006).
Armstrong (2006) is also of the opinion that organisations that operates within a particular industry should adopt a benefit system that other employers in that industry are using or set up a performance based system that is based on set performance standards and profitability goals of the organisation. Organisations must develop and maintain pay structures that demonstrates fair equity and consistency in order to continually motivate and increase their employees’ performance. Where employees feel that the work they are doing is more than what they are been paid for, then they become dissatisfied as they expect a pay that is commensurate with their labour.
Torrington & Hall (2006), further opined that organisations should design their benefit programs properly in other to reinforce positive behaviour to work and enhance performance by the employees. This will enable the employees to connect the benefit directly with the right attitude to the attained higher performance. To ensure positive reinforcement through an effective benefit system, such systems should focus on encouraging the desired attitude and behaviour within the organisation. In other words, the benefit system must be able to influence positive actions by the employees that will lead to better organisational performance.
Torrington & Hall (2006) also advised that organisations in the manufacturing sector, most especially, manufacturer of global brand-name products needs to find ways to improve their employees’ motivation level so as to increase their performance level. They suggested recognition as one of the ways to improving their employees’ morale through giving each employee the opportunity to nominate anyone for such recognition. That way, the employees will feel appreciated and such employees could be given recognition certificate.
Purkayastha & Chaudhari (2011) conducted a research on staff of Scottrade Inc.; a firm that deals in financial services. The employees, in sharing their experience, revealed that they get motivated more whenever they are formally recognised and this always make them to want to out-do their previous performance. Industry observers believe that the organisation’s sterling performance must have been as a result of the organisation’s benefit system which is motivating the staff to continue to increase their performance.
One of most organisation’s policies that has been found to increase staff performance and increase output of most organisations is the employee benefit policy according to Ajila (2007). Most organisations are aware that they require high productivity to compete in today’s competitive environment based on the current international economic development, therefore, their employee’s performance in terms of productivity is required for the organisation’s performance. Hence, the development and growth of the employees for maximum performance is dependent on how robust the employees’ benefit system of the organisation is.
In conclusion, in other for the organisation to achieve its set goals and objectives, the employee benefit system to be created must be one that, not only aligns the organisational goals and objectives with the employees objectives, it must be one that the employees will be happy with, one that will influence their decisions to accept a job offer from the organisation or one that would make current employees remain with the organisation.
With an employee benefit system that places different types of incentives at the disposal of its employee, the employees will feel satisfied with the organisation for adding value to their lives and hence, put their best to their job and ultimately increase the performance of the organisation.
A dissatisfied employee will just do the barest minimum to get their work done and will most likely put a lot of effort into seeking other job offers with better job packages. The cost of labour turnover is huge for the organisation that has spent so much in training such employee most especially if such an employee is snatched by a competitor to the organisation.
CHAPTER ONE – INTRODUCTION