FRINGE BENEFITS AND EMPLOYEES PRODUCTIVITY IN PUBLIC SECTOR

Introduction

1.1 Background of the study

The concept of employees’ commitment has received increased attention in the recent times. According to Becker (2000) research literatures are paying increasing attention to the concept of commitment as managers and organizational analysts are continually seeking ways of increasing employee retention and performance. Interest in organizational commitment has therefore been stimulated largely because evidence in the research literature has it that commitment reduces turnover and increases performance. A reduction in turnover could be an indication of a high level of commitment and performance. An increase in turnover on the other hand could amount to a low level of organizational commitment and performance. This is because a high level of organizational performance can be achieved only when an organization has a committed labour force.

With the introduction of monetization and fringe benefits policy in 2005, civil servants have been paid certain percentage of their basic salary as fringe benefits which are added to the basic salary, meaning an increment in salary of workers. Although, there is much academic debate on the extent to which additional income is a direct motivator (Nwagwu, 2007).

Job satisfaction describes how satisfied an individual is with his or her job. The happier people are within their job, the more satisfied they are said to be. Job satisfaction is not the same as motivation or aptitude, although it is clearly linked. Job design aims to enhance job satisfaction include job rotation, job enlargement, job enrichment and job re-engineering. Other influences on satisfaction include the management style and culture, employee involvement, empowerment and autonomous work position. Job satisfaction is a very important attribute which is frequently measured by organizations.

1.2 Statement Of The Problem

Commitment of worker has been described by Moser (2002) as the most important ingredient to an effective work output. Aside from completing tasks for the joy of doing them, it has been discovered that motivation drives people’s behaviour to attain a specific outcome. This explains why developing an effective and efficient compensation system becomes an important part of the human resource management process in advanced countries.

The attitude of Nigerian workers in terms of output compared to the more developed countries in recent times is becoming alarming. This could be attributed to uneven reward system, poor income, and unfavourable social, economic, and political infrastructure of the country. Rewards are an ever-present and always controversial feature of organizational life in Nigeria

The monetization policy, which was formally introduced into the Nigerian Public Service in 2005 led to monetization of those physical benefits which were added to the basic salary of workers. Despite the implementation of monetization policy in Nigeria, little has been done to clearly show the effect of the policy on the level of the performance of workers. However, their purchasing power is hardly enhanced due to the biting effects of inflation and high cost of living in the country. There is the need to know whether the addition to salary through the monetization of benefits and prompt payment of these benefits will have any effect on the workers with their disposition to their workplace.

Government employees and their immediate families have always enjoyed these benefits at her expense. Though the running cost may not cater for all the expenditure, but the expenses incurred in the course of service are refunded, most workers get their expended money back when these funds are released for offices. Now, it is not clear whether workers would want to spend their money to buy all these physical needs under monetization regime since it is now consolidated to the salary to almost become the basic salary. It is not also clear how monetization policy will lead to improved welfare condition of the workers through the provision of all the monetized needs from their new salary scale, judging from the impact of Structural Adjustment Programme (SAP) on workers.

In essence, workers commitment to their jobs and their efforts are often not addressed properly, creating room for false claims, agitations and labour conflicts.

1.3 Objectives Of The Study

The study examines monetization of fringe benefits and commitment of workers. The specific objectives are:

1. To examine the effect of fringe benefits on workers’ income.
2. To find out how the fringe benefits have helped in improving workers’ job satisfaction.
3. To investigate the effects of fringe benefits on employees job satisfaction.
4. To find out the management attitude to the welfare of the workers.
5. To examine the impact of employees’ participation in decision making in an organization.

1.4 Research Questions

Three questions are posed in order to explore the problem:

1. Is there any relationship between fringe benefits and employees’ job satisfaction?
2. Do fringe benefits and rewards have a strong influence on workers performance?
3. Does participation of employees’ in decision making in an organization motivate an employee?
4. Does fringe benefits helps achieve or accomplish an organization’s goals or otherwise?

1.5 Research Hypotheses

1. Ho: Fringe benefits and reward do not have any strong influence on employee job performance.
   H1: Fringe benefits and reward have strong influence on employee’s job performance.
2. Ho: Fringe benefits and reward does not contribute to increase job satisfaction.
   H1: Fringe benefits and reward contribute to increase job satisfaction.
3. Ho: The participation of an employee in decision making in an organization does not motivate the employee to work hard.
   H1: The participation of employee in decision-making in an organization motivates the employees to work hard.

1.6 Scope Of Study

The study therefore, focuses on the impact of fringe benefits on workers and how the exercise has increased the morale/performance of workers in their workplaces.

The scope of this study is restricted to Nigerian Port Authority. The study will see workers performance on employee’s job satisfaction: while carrying out this research, the researcher was constrained by some factors. The time schedule for the study was not enough to really study the impact of performance management on employee’s productivity. Also, the available materials and financial resources were limited to carry out the research. Also, the distribution of questionnaire and collection, coupled, with the energy it required also served as constrained to this study.

It is believed that these limitations will not, in any way, reduce the quality of the study but will, however, provide an impetus for further research.

1.7 Significance Of The Study

The importance of this study is channeled toward realizing the effects of fringe benefits on employees’ job satisfaction. Fringe benefits are significant and positive determinants of job satisfaction. It is equally important in assisting organizations to examine the various determinants on job satisfaction. Also, it assists the management to have positive attitude to the welfare of other workers.

The study will also help to appreciate employees in Nigerian Port Authority who are doing better in their work.

1.8 Definitions Of Terms

Job satisfaction describes how content an individual is with his or her job. It is a measure of how the conditions of service of a company meet or surpass employees’ expectation.

Motivation:

This is the willingness to extent high levels of effort to reach organizational goals, conditioned by the efforts ability to satisfy some individual needs.

Productivity:

Productivity represents the output of goods and services, which can be obtained from a given input of employee. It is the rate at which a company produces goods or services in relation to the amount of materials and number of employees available.

Development:

This is the process of according learning to an employee in order to enable him/her acquire more skills on the job.

Employee:

Individuals or persons who are into a paid employment or job. They are the human factors of production. They are agents of employers engaged by same for the purpose of attaining employers/organizational goals.

1.9 Organization Of Study

Chapter one is the introductory part of this project work. Chapter two contains Literature Review. Chapter Three − research methodology deals with data collection, the type of sampling techniques. Also, it reveals if data to be collected are primary or secondary or both which are useful in the study. For the research, it is both primary and secondary sources of data. Data collected through questionnaire will be analyzed in chapter four and summary of findings, recommendations, conclusions and suggestions for further research will be dealt with in Chapter five.