THE IMPACT OF INCENTIVE PLANS ON EMPLOYEE PERFORMANCE

ABSTRACT

The study was designed to provide information to organisations and establishments in either the Private or Public Sector in appreciating the impact of incentive plans on the performance of employees.

The population of this study consisted of 50 respondents (38 males and 12 females) in age range of 21‑60 years with a mean of 33years who have been working in their respective offices. The sample of the study consistent of 40 Junior State and 10 Senior Staff that were randomly selected using the random sampling technique.

The study was in two phases, the first phase was on standardization of the test instrument while the second phase was on assessment. The result of findings revealed a positive significant reliability of co‑relation co‑efficient of the instrument used. It was also recommended that a periodic review of both monetary and non‑monetary incentives should be done in order to monitor the changing nature of the work force towards improving employee performance.

CHAPTER ONE

1.1   BACK GROUND OF STUDY

Developing the compensation package of an organization is a complex and continuous assignment of the personnel department. This possibly accounts for the reason why all personnel department structures, whether for a small or big organization, each has a section a signed with the function of ensuring that people are fairly and adequately remunerated.

Compensation therefore refers to the payment of fair and adequate remuneration to employees.

Direct compensation refers to money paid to a worker for his performance of his job assignment Le salaries and wages, while.

Indirect compensation includes incentives, fringes benefits and other kinds of benefit paid to workers.

Incentive are there fore rewards (outside salary or wages) which are given to an employee with the aim of motivating or stimulating him to work harder.

However salary/wages are used to attract employee and they are money paid for work done (Burack and Smith) stress that an incentive scheme is a plan or programme to motivate individual or group performance. An incentive programme is most frequently built on monetary rewards e.g. bonus or incentives pay but it may also include a variety of non‑monetary rewards or prize. It includes many kinds of inducements offered to employees to make work even beyond acceptable standards and time.

This research work will look at the development of incentive schemes which is a sub‑function of the personnel department. However it must be discusses that incentives are paid of a motivation system this great emphasis will be laid on motivation with incentive being a contribution to motivation.