THE ROLE OF INCENTIVES AND FRINGE BENEFITS ON EMPLOYEES PRODUCTIVITY (A CASE STUDIES OF GREENFIELD METALS LTD AND ALUMINIUM-GOLD ENGINEERING LTD)

ABSTRACT

This research work is to study the role of incentives and fringe benefits on employee’s productivity.  Case studies of Greenfield Metals Ltd and Aluminium-Gold Engineering Company Ltd.

From the course of the study, it was discovered that majority of the employees accepted that:

1.       Incentive and fringe benefit based on performance can lead to increased productivity

2.       Proper use of incentive and fringe benefit as a motivational tool can lead to increased productivity.

3.       If various incentives and fringe benefit are applied, it can activate worker and thereby lead to greater output.

While the least number of the employees seem not to know the criteria on which the management is using to administer the incentive and fringe benefit.  It was on that that it was recommended to the management to make a copy of the edicts/condition of service to every employee of the company so as to enable them carry all the employees along, and the employees will equally know their rights and entitlement when they become more committed to their job.  And this definitely increases employee’s productivity.

TABLE OF CONTENTS

TITLE OF PAGE                                                                                       i

Certification Page                                                                                       ii

Dedication                                                                                                  iii

Acknowledgement                                                                                                iv

Abstract                                                                                                      v

CHAPTER ONE:  INTRODUCTION

1.1     Background of the Study                                                                            1

1.2     History of the Companies                                                                 3

1.2.1  Greenfield Metals Ltd                                                                       3

1.2.2  Aluminium-Gold Engineering Ltd                                                     4

1.3     Identification of Problem                                                                            5

1.4     Aims and Objectives of the Study                                                     5

1.5     Significance of the Study                                                                            6

1.6     Scope of the Study and Limitation                                                   6

1.7     Hypothesis                                                                                        7

1.8     Definition of Terms                                                                           7

CHAPTER TWO: LITERATURE REVIEW

2.1     The Concept of Organizational Incentives and Fringe Benefits       9

2.1.1  Incentives in an Organization                                                            9

2.1.2  Forms of Organizational Incentives                                                  11

2.1.3  Fringe Benefits in an Organization                                                    12

2.1.4  Forms of Organizational Fringe Benefits                                          13

2.2     Motivation in the Organization                                                                  15

2.2.1  Concept of Employee’s Motivation                                                  15

2.2.2  Incentives and Fringe Benefit as Motivational Factor                       16

2.2.3  Some theories of Motivation                                                             18

2.2.4  Application of Motivation Theories to the Nigerian Workers          30

2.3     Productivity in the Organization                                                       32

2.3.1  The Concept of Productivity                                                             28

2.3.2  The Motivation-Productivity Linkage                                                        30

CHAPTER THREE: RESEARCH DESIGN

3.1     Design                                                                                               40

3.2     Sample and Sampling Procedure                                                      40

3.3     Reliability and Validity of the Instrument                                         41

3.4     Method of Data Collection                                                                41

3.5     Method of Data Analysis                                                                           42

CHAPTER FOUR:  PRESENTATION OF DATA

4.1     Composition and characteristics of Respondent                               43

CHAPTER FIVE:  ANALYSIS OF DATA

5.1     The Chi-square Values                                                                      51

5.2     Hypothesis Testing                                                                           52

CHAPTER SIX:  INTERPRETATION, MEANING, AND DISCOVERY

6.1     Hypothesis One                                                                                60

6.2     Hypothesis Two                                                                               60

6.3     Hypothesis Three                                                                              61

CHAPTER SEVEN:  DISCUSSION OF FINDINGS

7.1     Hypothesis One                                                                                63

7.2     Hypothesis Two                                                                               63

7.3     Hypothesis Three                                                                              65

7.4     Summary                                                                                          65

          Bibliography                                                                                     67

          Appendix 1                                                                                       70

          Appendix 11                                                                                     71

          Appendix III                                                                                     75

CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND OF THE STUDY

A major determination of the success of an organization is the effective management of the human resource, which is the controller of all other resources available to the organization.  The effective management of man will lead to increase in his productivity, which translates to increase in the productivity of the organization.

In discussing productivity, labour productivity has always been of prime importance because all other factors of production become productive only in association with labour.  The need for the effective management of this prime productivity factor is very crucial in Nigeria today.  This is due to the abundant man power resources facing limited capital in the country.

Man is a very complex being and managing man to increase his productivity involves motivation, hence the purpose of incentive and fringe benefit is to create conditions that will make it possible for the workers to work with increased zeal and group moral satisfaction can be effectively achieved.

Furthermore, labour productivity can be influenced by using Mac Gregors theory X and Herzberg’s postulation.

Hence this paper is to study the response of workers to the role of incentives and fringe benefits on employee productivity using an Engineering Company and Mining Industry as case studies.

Therefore when a group of employees are observed on the job, one may notice the differences in performance.  Some people do an excellent job, while others are marginal in their output.  Some employees come early, put in hard day’s work and stay late, while others are always taking a break and are never around when needed.  In some cases, the best worker may produce two or three times as much as the poorest worker.  How could these differences be explained?  Well, obviously certain trait and abilities are attributed to the productive employee.

The person may be intelligent, aggressive and extroverted.  But, there is more than just ability.  There is something willful about the differences between the employees.  Somehow, the productive employee is described as more motivated or driven than the other person.  Motivation as it is being described here implies a willful act on the part of an individual.  The employee may choose to try hard and to exert a lot of effort or may choose just to get by (Akanni 1987: 242) and thereby bring about increase output.

The purpose of motivation is to create conditions in which people are willing to work with zeal, interest and enthusiasm: with a high sense of responsibility, loyalty, discipline and pride and with confidence in a most cohesive manner so that the goals of an organization are achieved.

1.2     HISTORY OF THE COMPANIES

1.2.1  GREENFIELD METAL LTD