Embed Size (px)
Citation preview
REMUNERATION AND EMPLOYEE PERFORMANCE IN HOTEL
ESTABLISHMENTS: CASE STUDY MUNYONYO COMMON
WEALTH RESORT HOTEL
BY
TUHUMWIRE AGNES
BTM/ 34803/ 113/DU
A RESEARCH REPORT SUBMITTED TO THE COLLEGE OF
APPLIED ECONOMICS AND MANAGEMENT SCIENCE IN
PARTIAL FULFILLMENT OF THE REQUIREMENT
FOR THE AWARD OF A BACHELOR'S DEGREE IN
HOTEL AND TOURISM MANAGEMENT
OF KAMPALA INTERNATIONAL
UNIVERSITY
MAY2014
DECLARATION
I, Tuhumwire Agnes declare that, this proposal is original both in writing and substance unless
where entirely duly acknowledged and it has never been submitted to any other institution of
learning whatsoever.
Sign: ....... ~.~ ............ .. TUHUMWIRE AGNES
BTM/34803/113/D U
Date: ....... ~. L/R{;. /.+.9 .. 1.1. ........ .
11
APPROVAL
This report on "Remuneration and Employee Performance in Hotel Establishments" has been
under my supervision and it is now ready for submission to College of Economics and
Management Science of Kampala International University
S. ~ , ,... 1gnature: ... ~ . . .. ....... .
AKITENG STELLA
SUPERVISOR
3L- 'Q:('-2mU_ Date: ....... . .. . ................. T.
l1l
DEDICATION
I would like to dedicate this disse1iation to my family members for the love, care, guidance and
facilitation they have given me especially my mother Ainomugisa Angela, my father Bategeka
Lawrence and I promise never to let you down.
Secondly I appreciate the suppOii of my friends especially Mazarawu Margret and that all who
gave a hand during my research, thank you for the support you gave me eve when the world had
lost trust in me and the good Lord be with you all.
Finally I would like to thank my lecturers and supervisor for the advice and guidance they have
given me during the course of my research.
IV
ACKNOWLEDGEMENT
First and for most I thank the Almighty God for having enable me to complete
my research and degree successes fully.
The researcher would also like to thank the management ofMunyonyo Common Wealth Resort
Limited Hotel for the information they gave me during my research.
v
TABLE OF CONTENTS
DECLARATION ................................................................................................ ii
APPROVAL ..................................................................................................... iii
DEDICATION ................................................................................................. iv
ACKNOWLEDGEMENT .................................................................................... v
TABLE OF CONTENTS ................................................................................... vi
ABSTRACT ..................................................................................................... ix
(;lfl\J>Jr~~ ()~~ ......................................................................................... 1
llltr<><illc:tie>ll ••••••.•••••••••••••••••••••••••••••••••••••••••••••••••••••••••••.••••••••••••••••••••••••• 1
1.1 Background of the Study ........................................................................... 1
1.2 Problem Statement .................................................................................... 4
1.4 Purpose of the Study ................................................................................. 5
1.5 Specific Objectives ..................................................................................... 5
1.6 Research Questions .................................................................................. 5
1. 7 Scope of the Study .................................................................................... 5
1. 7.1 Geographical Scope ................................................................................ 5
1. 7.2 Content Scope ........................................................................................ 6
1.7.3 Time Scope ............................................................................................. 6
1.8 Significance of the Study ........................................................................... 6
1. 9 Conceptual Framework ............................................................................. 7
C:IIAI'TER T\lf() ••.••••••••••••••••••••••••••••••••••••.•••••••••••••••••••••••••••••••••••••••••.•••••• l3
2.0 Literature Review ...................................................................................... 8
2.1 Introduction .............................................................................................. 8
2.2 Concept of Remuneration .......................................................................... 8
2.3 Forms of Remuneration Packages ............................................................ 10
2.3.1 Wages and Salary ................................................................................. 10
2.3.2 Fringe benefits ..................................................................................... 10
VI
2.3.3 Incentives ............................................................................................. 10
2.3.4 Perquisites ........................................................................................... 10
2.3.5 Bonuses, profit sharing and stock options ............................................ 11
2.3.6 Group based rewards ........................................................................... 11
2.4 Factors Influencing Employee Remuneration .......................................... 12
2.5 Definition of Employee performance ...................................................... 14
2. 6 Factors of Employee performance .......................................................... 15
2.7 The Relationship Between Remuneration Package and Employee
Performance .............................................................................................. 15
CHAPTER THREE ................................................................................... 19
Methodology .......................................................................................... 19
3.1 Introduction ............................................................................................ 19
3.2 Research Design ..................................................................................... 19
3.3 Study Population .................................................................................... 19
3.4 Sample Population .................................................................................. 19
3.4 Sample Selection Technique .................................................................... 19
3.5 Sources of Data Collection ....................................................................... 20
3.5.1 Data Collection Methods ...................................................................... 20
3.5.2 Primary Data ........................................................................................ 21
3.5.3 Secondary Data .................................................................................... 21
3.5.4 Data Collection Instruments ................................................................. 21
3.5.5 Questionnaire ...................................................................................... 21
3.5.6 Interview .............................................................................................. 21
3.5.7 Documentary review ............................................................................. 22
3.6 Data Collection Procedure ....................................................................... 22
3.7 Data Analysis .......................................................................................... 22
3.8 Ethical Consideration .............................................................................. 22
3. 9 Limitations of the Study .......................................................................... 23
CHAPTER FOUR ..................................................................................... 24
vii
CHAPTER FOUR ..................................................................................... 24
4.0 Data Presentation, Interpretation and Discussion of Findings .................. 24
4.1 Introduction ............................................................................................ 24
4.2 General findings ...................................................................................... 24
4.3 Finding on the objectives of the study ...................................................... 29
4.4 Factors which influence employee performance ....................................... 31
CHJ\l'TER FI"E ...................................................................................... ~~
5.0 Discussion, Summary, Conclusion and Recommendation ........................ 35
5.1 Introduction ............................................................................................ 35
5.2 Discussion on the nature of remuneration ............................................... 35
5.3 Discussion on the factors which influence employee performance ............ 36
5.3.1 Other factors influencing performance .................................................. 36
5.4 Summary of the Findings ........................................................................ 37
5.5Discussion on the relationship between remuneration and employee
performance .................................................................................................. 38
5.6 Conclusions ............................................................................................ 39
5.7 Recommendation .................................................................................... 39
5.8 Area for Further Research ....................................................................... 40
REFERENCES ........................................................................................ 41
1\J>l?ErJI>I}( I ........................................................................................... 4~
QUESTIONNAIRE SCHEDULE ....................................................................... 43
APPENDIX II ................................................................................................. 47
INTERVIEW GUIDE ....................................................................................... 47
APPENDIX III ................................................................................................ 49
TIME FRAME ................................................................................................ 49
APPENDIX B ................................................................................................. 49
TIME FRAME ................................................................................................ 49
APPENDIX III: PROPOSED BUDGET ............................................................. 50
viii
LIST OF TABLES
Table 1: Sample Size ..................................................................................... 20
Table 2: Composition of sample by Gender .................................................... 24
Table 3: Age Groups of the Respondents ........................................................ 25
Table 4: Level of Education of the Respondents ............................................. 26
Table 5: Distribution of Respondents by Department ..................................... 28
Table 6: Effectiveness of Remuneration ......................................................... 29
Table 7: Methods of remunerating workers .................................................... 30
Table 8: Percentage of factors which influence employee performance ............ 32
Table 9: Challenges to monitory performance ................................................ 33
Table 10: Relationships between remuneration and employee performance ... 34
IX
LIST OF FIGURES
Figure 1: Conceptual Framework .................................................................... 7
Figure 2: Composition of sample by Gender ................................................... 25
Figure 3: Age Groups of the Respondents ...................................................... 26
Figure 4: Level of Education of the Respondents ............................................ 27
Figure 5: Distribution of Respondents by Department ................................... 28
Figure 6: Effectiveness of Remuneration ........................................................ 30
Figure 7: Methods of remunerating workers .................................................. 31
Figure 8: Percentage of factors which influence employee performance in
Munyonyo Common Wealth Resort Limited ................................................... 32
Figure 9: Challenges to monitory performance ............................................... 33
X
ABSTRACT
This report on the of remuneration and employee performance covered five
chapters which included;
One chapter involving the background of the study, statement of the problem,
purpose of study, specific objectives, research questions, scope of the study,
significance of the study and the conceptual framework.
Chapter two involving opinions from renown authors about the topic under
study of which among other aspects involves the concept of remuneration,
forms of remuneration, factors influencing employee performance, definition of
employee performance, factors of employee performance, relationship between
remuneration and employee performance.
Chapter three involves the specific research methodology and techniques that
the researcher employed in order to obtain data. It involved the research
design, study area, population sampling strategies, data collection techniques
and data analysis techniques.
Chapter four involves and discusses findings of the study and draws
conclusions. A sample of a hundred respondents was targeted but only 50
responded. The sample considered only employees of Munyonyo
Commonwealth Resort Limited Hotel some respondents did not respond
especially those who were identified to fill questionnaires. In this part of the
study the researcher used tables and figures to present findings.
Chapter five presents the discussion of the major study finding, summary of
the findings, conclusion and recommendations.
XI
CHAPTER ONE
1.1 Introduction
This chapter provides the background of the study, statement of the problem,
purpose, specific objectives, research questions, scope, significance of the
study and the conceptual framework.
1.2 Background of the Study
The use of rewards in influencing employee performance for organizational
positive achievements dates back to the 1950s with a number of contributory
factors combined. Many studies have focused on a small number of variables
which explain only a small amount of variability in remuneration and yet these
do not explain adequately or capture the complex psychological processes
involved in individual employee decisions, among which remuneration
dissatisfactions have not been clearly analyzed. The need to manage
remuneration thus comes up when a business entity recognizes the benefits
associated with a motivated workforce (Glasscock and Gram, 2005).
Traditionally most remuneration programmes were vague, and often given in
response to a manager's perception of when an employee was viewed to have
performed exceptionally well, but with no set standards to measure the
exceptional performance (Kamukama, 2006). Exceptional standards m
performance were translated to imply anything from having a good attitude,
assisting another department, or being consistently punctual. Indeed through
the 1980-90s there was a growing interest of individual performance related to
pay based on the belief that it would lead to improved productivity and cultural
change. Thus in the current settings, business entities have now understood
the great gains derived from linking remuneration to organizational business
strategy (Mullins, 2004). Management of remuneration is now considered and
identified as a manipulation and power which if well organized can help in
1
maximizing potentials in meeting organizational objectives through enhancing
employee performance (Glasscock and Gram, 2005).
This is because in any competitive climate, administrators are looking towards
the improvement in services while reducing costs (Bwire, 2005). Therefore the
stronger the agency's remuneration package management system, the tighter
and effective its' services will be (Mullins, 2004). The impression is that, as
small business entities need to get more from their employees (Kamukama,
2006), and as they expect employees to perform reliably their tasks following
set standards and rules through self initiative, continuous learning and
responsiveness to needs (Mullins, 2004), employees are also similarly looking
for more out of organizations( Chavan, 2010). Employees in turn expect fair
pay, safe working conditions, and fair treatment (Parker et al, 2001). This
implies that, for an organization to meet its obligations, management must
develop a relationship between the organization and employees to fulfill the
continually changing needs. Indeed, Milkovich and Newman (2005) view
remuneration as all forms of financial returns, tangible services and benefits
that employees receive as part of an employment relationship. Thus, to
Glasscock and Gram (2005), they assert that much as remuneration
management has previously been a domain of large organizations, small
businesses have also undertaken the same tool to lure top employees in the
competitive world, in addition to increasing employee performance.
According to Kamukama (2006), a well managed remuneration system helps in
devising systems through which, sufficient pay is accorded and distributed
between labour and how remuneration compensation is received by an
employee in return for his or her contribution to the organization. Therefore,
according to Kamukama, remuneration occupies an important place in the life
of an employee. The reason as to why Parker et al (2001) associates the
employee's standard of living, status in society, motivation, loyalty, and
productivity as dependent on the remuneration he or she receives. For the
2
employer, remuneration is significant because of its contribution to the cost of
production and thus requires to be effectively managed. For Human Resource
Management too, reward is a major function which involves both monetary
benefits that one receives as part of an employment agreement and the tangible
products employees can be offered. This according to Milkovich and Newman
(2005) implies that measurement of remuneration needs to be adequate in
comparing the different contributions of employees to Improve their
performance contribution.
Similarly Bwire (2005) expresses employee performance contribution to be the
rate at which an employer meets adequate pay and in return of measurable
improvement in employee performance. According to Bwire, the simple ways to
describe it are how much employees tend to contribute to achievement or this
may also translate to employee rate of traffic through the revolving door when
better remuneration opportunities come up. This therefore obliges business
entities to measure remuneration sufficiency for their industry as a whole
(Kamukama, 2006). Indeed Staw and Mowday (1991) establish that, if an
employer is said to have a low organization performance achievement compared
to its competitors, then employees of that company happen to have a small
remuneration package and tenure than those of other companies in the same
industry. Thus they assert that, a poorly managed remuneration system can be
harmful to a company's productivity, particularly if skilled workers are paid
lowly and are less willing to contribute 100 percent of their unique abilities to
the growth of the organization and remain redundant as they await better
opportunities to switch jobs. This is also true if the worker's population
contains a high percentage of apprentice workers.
Reflecting on the above background and setting, remuneration management
should be an important factor in any Hotel establishment like that of
Munyonyo Commonwealth Hotel which relies heavily on professionalized staff
who account for over 65 percent of the total work force. There is a recognizable
3
trend and pace at which qualified and skilled personnel are entirely motivated
to wholly contribute their unique abilities. This hotel's remuneration program
is mainly composed of wages and salary with no particular incentives to
productivity of workers and overtime work. Salaries and wages are determined
by the establishment's top management depending on terms upon which labor
has been contracted. Thus salaries and wages vary for the different employees
both skilled and non skilled and temporary or permanent. The way Munyonyo
Commonwealth Hotel manages its reward system in varying aspects raises
concern for this study to be pursued to find out whether the remuneration
practices have a direct effect on employee performance. This will be a
contribution to the required areas of remuneration management improvement
upon establishing the weaknesses in performance that come about as a result
of remuneration.
1.3 Problem Statement
It is imperative to state that, the responsibility and commitment of any
management towards its human resources m any business entity or
organization would be how it rewards its human capacities in promoting the
achievement of organizational goals. This IS because, remuneration
management if effectively exercised, brings about job satisfaction, reduces
possible protests and complaints (Maicibi 2003) thereby increasing employee
productivity and growth of organization. However, in Munyonyo
Commonwealth Hotel, not sufficient attention has been given to implementing
effective remuneration management systems. For this, employee performance
contribution remains low. It is therefore projected that for the years to come,
the level of efficiency and performance in the institution is likely to be affected
if the hotel does not revise its remuneration system to improve performance.
This as a consequence will reduce the number of visitors and guests, especially
that the Hotel is expected to supply quality services to reflect the high pay met
and standards expected by its clients. The study is therefore prompted to
4
examine the effect of remuneration on employee performance m Munyonyo
Commonwealth Hotel.
1.4 Purpose of the Study
The purpose of the study 1s to investigate the effect of remuneration on
employee performance in Munyonyo Commonwealth Resort Limited Hotel.
1.5 Specific Objectives
i) To establish the forms of remuneration packages adopted by Munyonyo
Commonwealth Hotel.
ii) To establish the factors of employee performance m Munyonyo
Commonwealth Hotel
iii) To establish the relationship between remuneration and employee
performance in Munyonyo Commonwealth Hotel.
1.6 Research Questions
i) What are the different forms of remuneration packages adopted by
Munyonyo Hotel?
ii) What are the factors of employee performance seen m Munyonyo
Commonwealth Hotel Kampala?
iii) What is the relationship between remuneration and employee performance
in Munyonyo Commonwealth Hotel Kampala?
1. 7 Scope of the Study
1.7.1 Geographical Scope
The study was carried out at Munyonyo Commonwealth Resort Limited Hotel in
Munyonyo which is located off Ggaba Road, and is a 40 minutes drive under
heavy traffic from the city center.
5
1.7.2 Content Scope
The study was restricted to remuneration and employee performance in
Munyonyo Commonwealth resort Hotel and was basically examining the forms
of remuneration packages afforded by the hotel; factors of employee
performance and this will help to establish the relationship between
remuneration and employee performance at the hotel.
1.7.3 Time Scope
The study was conducted basing on primary data from years 2009 2014
because this was a period when there was a high labour turn over, many
absenteeism reported.
1.8 Significance of the Study
The study throws more light to management on issues regarding management
of remuneration for proper and more effective approaches to be adopted which
can lead to improved employee performance.
To the academicians and future researchers, the study is advantageous
to fellow academic hunters and future research practitioners who are
interested in understanding studies related to this subject in a similar or
different establishment to narrow remuneration employee performance gaps.
To hotel institutions, the study may change the attitude of employers on
addressing remuneration related issues.
To the policy makers; the study is a source of reference materials m
providing guidelines to policy makers m reviewing their approaches m
determining employee remuneration.
To the researcher, the study contributes substantially to the award of
Bachelors in Tourism and Hotel Management of Kampala International
University.
6
1.9 Conceptual Framework
Figure 1: Conceptual Framework
·.···• ·.··. . // .... ···•·· [ Independent Variable ]2
. •· ...... 1 / /•./ ..... Remuneration package "'\
• Wages ' Salary • Fringe benefits ' Bonuses • Holiday packages ' Non Monetary benefits ' Leave ' Group incentives
/ Moderating Variable
' Development strategies • Reinforcement strategies • Motivational strategies ' Directive Strategies
Source: (Self compiled from text books)
[ Dependent Variable jj)
Employee pedormance
' Increased/decreased employee productivity
' Improved/reduced teamwork contribution
• Organizational profile development/malice
' Increased/reduced hotel profits
' Increased/reduced employee retention
• Managerial success/difficulties
The two variables above indicated that if a good remuneration procedure is
undertaken by management without biases, its impacts m as a far as
employees performance is concerned can be manifested m form of high
productivity, quality output and increased employee efficiency. The impacts of
hardworking are in turn revealed in form of high productivity, quality output
and increased employee efficiency but the reverse is true for poorly managed
remuneration systems.
7
CHAPTER TWO
2.0 Literature Review
2.1 Introduction
This chapter covers opinions from renown authors about the topic under study
of which among other aspects involves the concept of remuneration, forms of
remuneration, factors influencing employee performance, definition of employee
performance, factors of employee performance, relationship between
remuneration and employee performance.
2.2 Concept of Remuneration
According to John 0. Dams theory, remuneration is typically utilized to
energize, direct or control employee behavior. The perceptions of which inequity
may result in employees taking action to restore equity (Note and Hollembeck
et a!, 2003) some of these actions may be negative while others may be positive
and these may involve sit down strikes or call for dialogue respectively.
Rewards therefore require to be provided to employees in return for their labour
to motivate them to good performance.
Parker and Burton ( 1970) developed a theory relating wage to performance
which they labeled incentive to perform. According to them as quoted in their
book entitled Management attitudes and performance it was shown that;" ...
Inter-Industry wage differentials are examples of those variables which measure
the incentives of workers to perform or quit because of comparisons they make of
attributes of their own firms and other firms".
One of the early theorists F.W. Taylor and M. Armstrong in their publication
personnel management assumed that;" .. .. Man is a rational animal concerned
with maximizing his economic gains ....... "
On the contrary however, Gold thorpe ( 1969) conducted a study from three
manufacturing firms in Luton England and his book "changing supervisory
8
behavior revealed that;" ... worlc that offers relatively intrinsic rewards may not
in fact form the basis of a powerful tie between the worker and his employment
because of inter-veiling dissatisfaction, grievances and work which by its nature
entails severe depression for those who perform it may nonetheless offer intrinsic
remunerations which are to attract workers fairly and firmly to the employer who
offers his work!'
However, a reflection made on Professor Herzeburg's theory on motivation as
illustrated from his book entitled "work and the nature of man" Herzerburg
divided the factors into two categories that is to say motivators (strategies) and
hygienic factors (dissatisfies) under motivators he pointed out that they
include; company policy, supervisory style, and salaries and wages. In the book
of William H. Davis, "Behavior in organizations" a multi-dimensional view
provides that; " .. there is no single factor in the whole field of labour relations
that does more to break down morale, create individual dissatisfaction,
encourage absenteeism, increase labour turnover, hamper production but the
obviously unjust inequalities in remunerations given or wage rate paid to
different individuals in the same labour group within the same workplace."
While for Professor Abraham Maslow as quoted in his book; "Theory of
motivation, fundamental of human behavior "proposed a hierarchy of human
needs in his theory of motivation. He contends that human needs seek to
satisfy the more basic needs first before satisfying needs at a higher level up
the hierarchy. The other levels of the hierarchy are physiological needs, safety/
security needs, love needs, esteem needs and finally self-actualization and all
most of these can be achieved when the company has a. good remuneration
management system. The current study will explore the possibility that
employees at Munyonyo will seek to satisfy their basic needs before meeting
organizational requirements hence study assumes that the poor the
remuneration, the lower their performances.
9
2.3 Forms of Remuneration Packages
Mahendra (2008) defines remuneration as an element of both monetary and
non-monetary labour compensations. Remuneration can financially be
expressed in terms of cash and benefits received; non-monetary in terms of
status, recognition, and esteem. Remunerations are currently issued after job
evaluations are carried out to decide the input of an employee contribution to
the position of an organization. Thus remunerations need to be seen by the
employee and organization, as just and impartial. Mahendra came up with the
following components of remuneration;
2.3.1 Wages and Salary
Wages refer the hourly rates of pay, salary refers to the monthly rate of pay,
wages and salaries are subject to annual increments. They differ from one
employer to another and also depend upon the nature of job, seniority and
merits.
2.3.2 Fringe benefits
These include such employee benefits as provident fund, gratuity, medical
care, hospitalization, accident relief, health insurance, canteen identity.
2.3.3 Incentives
These are also called 'payment by result' paid in addition to wages and salaries.
They depend upon productivity, overtime, sale profit and they include
individual incentives scheme, and group incentives scheme.
2.3.4 Perquisites
These are allowed to executives and include company cars, club membership,
paid holidays, furnished house among others.
10
2.3.5 Bonuses, profit sharing and stock options
Maclean and Stacey (2009) envisage that, as more small businesses use team
structures to reach their goals, many entrepreneurs look for ways to reward
cooperation between departments and individuals. Bonuses, profit sharing,
and stock options can all be used to reward team and group accomplishments.
2.3.6 Group based rewards
An entrepreneur can choose to reward individual or group contributions or a
combination of the two. Group-based reward systems are based on a
measurement of team performance, with individual rewards received on the
basis of this performance. While these systems encourage individual efforts
toward common business goals, they also tend to reward underperforming
employees along with average and above-average employees. A reward program
which recognizes individual achievements in addition to team performance can
provide extra incentive for employees (Spitzer and Dean, 2000).
2.4 Factors Influencing Employee Remuneration
A number of factors influence the remunerations provided to employees. They
can be categorized as internal or external factors. Chavan (2010), notes that
among the internal factors which have an impact on the pay structure include
company's strategy, job evaluation, performance appraisal and the worker
himself or herself.
On the other hand, Maclean and Stacey (2009) also point out that the overall
business strategy which a company pursues as determinant of the
remuneration to its employees. For instance where the strategy of the
enterprise is to achieve rapid growth, remuneration should be higher than the
competitors pay. Whereas where the strategy is to maintain and protect current
earnmgs, because of the declining fortune of the company, remuneration level
needs to be average or even below average. Job evaluation helps establish
satisfactory wage differentials among jobs. Performance appraisal helps award
pay increase to employees who show improved performance.
II
Maclean and Stacey (2009) also added that in the labour market, demand for
and supply of labour influence wage and salary fixation. A low wage may be
fixed when the supply of labour exceeds the demand for it. A higher wage will
have to be paid when demand exceeds supply, as in the case of skilled labour.
Indeed according to Stewart (2004) it is argued that a rise in the cost of living is
sought to be compensated by payment of dearness allowance, basic pay to
remain undisturbed. Many companies include an escalatory clause in their
wage agreement in terms of which dearness allowance increases or decreases
depending upon the movement of consumer price index (CPI). The study will
explore whether Munyonyo hotel is able to review employee remuneration m
case of any economic changes which affects employee pay rate.
Productivity can arise due to increased effort of the worker, or as a result of the
factors beyond the control of the management, and the like advance in
technology and more efficient methods of production. Productivity has only a
role in wage fixation (Stahl 1995). However, the argument that productivity
would increase if it is linked to remuneration is hardly acceptable if the
working conditions remain poor. The current study will venture into exploring
about the same.
According to Stewart (2004), the presence or absence of labour organizations
often determines the quantum of wages paid to employees. Employers of non
unionized factories enjoy the freedom to fix wages and salaries. The study will
explore whether there is any labour negotiation team for employees of
Munyonyo, to know whether minimum remuneration has been determined
adequately.
According to Stahl (1995), the impact on wage and salary fixation is also
affected by the state of the economy. In most cases, the standard of living will
rise in an expanding economy. Since the cost of living is commonly used as a
pay standard, the economy's health exerts a major impact upon pay decisions.
12
Labour unions, the government, and the society are all less likely to press for
pay increases in a depressed economy.
2.5 Definition of Employee performance
According to Divo Paguio(2013),employee performance are job related activities
expected of a worker and how well and how well those activities were executed.
It also refers to the job performance of an employee which shows his or her
contribution to the objectives of the company.
According to Rebecca Hunt (20 13), employee performance is a rating system
used in most corporations to determine the abilities and output of employees.
Performance IS divided into five components; planning, monitoring,
development, rating and rewarding. Most see employee's performance as a way
to appraise the employee for their effectiveness in the establishment.
Peoples Streme(20 13),says employee performance is a process for establishing
a shared work force about what is to achieved at an organization level. It is
about aligning the organizational objective with employees, agreed measures,
development plans and the delivery of results. The emphasis IS on
improvement, learning and development in order to achieve the overall
business strategy and to create high performance work force.
According to Business Dictionary (2014), employee performance are job related
activities expected of a worker and how well those activities were executed.
Many business personnel directors assess the employee performance of each
staff member on an annual or quarterly basis in order to help them identify
suggested ideas for improvement.
W.Univesiy of Washington human resource, employee performance is the
ability to perform effectively in your job requires that you have and understand
a complete and up to date job description for your position, and you
13
understand the job performance requirements and standards that you are
expected to meet.
Suhail Ajmal, says employee performance is the functioning and presentation
of the employee. The more good the performance would be the more good
ranking the employee would get in the company.
2.6 Factors of Employee performance
Majority of the respondents noted that salary was the pnmary factor which
influences employee performance of this establishment and incase of less
salary or late payments they are demotivated.
Time keeping was another factor of employee performance were by most of the
respondents said that it interfered with hotel activities hence leading to late
services and complaints with in the establishment.
Absentism of employees that lead to insufficient labour m the hotel. It was
noted that some employees don't attend to their shifts with out and this
affected employee performance.
Strikes were by some times the employees rejected duties assigned to them
since they were not motivated in any way by the hotel.
2. 7 The Relationship Between Remuneration Package and Employee
Performance
The extent of the effect of employee contribution to an organisation cannot be
fully understood if there is no attempt to quantify the costs it sustains on the
entire organization. The more complex approaches to costing performance the
more accurate and higher estimate of the costs. Such approaches often take
into account the costs associated with lost productivity and the effect on
morale of the entire workforce. One such framework is that proposed by Tziner
and Birati (2007) which builds on the Cascio model of separation costs,
replacement costs and training costs. The Tziner and Birati framework
14
includes: direct costs incurred in the employee replacement process for
instance in recruiting, hiring, training and socializing new employees just in
case the old employees prove inefficient. This includes the extra effort by
supervisors and co-workers to integrate them; indirect costs and losses relating
to interruptions in production, sales and the delivery of goods to customers;
financial value of the estimated effect on performance as a result of the drop in
morale of the remaining workforce following dysfunctional turnover.
Further still rewards affect the behavior of employee performance automatically
without complex cognitive processes. Thus to ensure good performance,
remuneration must be enough to meet the basic human needs and managers
should know that people compare their rewards to those of others therefore it
is the responsibility of the organization management to strategically manage
remuneration (Mahendra, 2008). Indeed according to the wall street journal of
1988, it is asserted that emphasis today is on pay for performance. Thus if we
understand what motivates employees, we are more likely to achieve our
personal goals when employees increase productivity.
Mullins (2005) envrsages that a low employee performance can be a senous
obstacle to productivity, quality, and profitability at firms of all sizes. For the
smallest of companies, this may mean employee turnover to translate into
"simply having enough staff to fulfill daily functions is a challenge, even beyond
the issue of how well the work is done when staff is available. Thus, turnover is
no less a problem for major companies, which often spend millions of dollars a
year on turnover-related costs. This implies that for service-oriented
professions, such as those provided by Munyonyo Hotel, low employee
performances may later on result into high labour turnover rates.
Consequently this may yield customer dissatisfaction and customer turnover,
as clients feel little attachment to a revolving contact.
15
Similarly, Mahendra (2008) asserts that customers are also likely to experience
dips in the quality of service, each time their representative is not happy and
demoralized thus to Stahl (1995), improving employee performance through
good pay reduces employee turnover and saves money. Money saved from not
having to find and train replacement workers can be used elsewhere, including
the bottom line of the company's profit statement. Although to Clint (2004) a
high turnover can sometimes be useful, because employers who are poor
interviewers may not discover that new employees are actually poor employees
until after the workers have been on the payroll for several weeks. Rather than
go for the trouble and documentation of firing these underperforming
employees, some companies rely on providing static but poor remuneration
packages to increase turnover to weed out the bad employees. When the
learning curve is small and the consequences of always having inexperienced
workers are mmimal, low employee performance contribution resulting in high
turnover may not be seen as a significant problem.
According to Thornburg and Linda (2004), it is noted that bonuses are
generally short-term motivators. By remunerating an employee's performance
for the previous year, say critics, they encourage a short-term perspective
rather than future-oriented accomplishments. Proponents, however, contend
that bonuses are a perfectly legitimate means of rewarding outstanding
performance, and they argue that such compensation can actually be a
powerful tool to encourage future top-level efforts. In addition, bonus programs
need to be carefully structured to ensure they are rewarding accomplishments
above and beyond an individual or group's basic functions. Otherwise, they run
the risk of being perceived as entitlements or regular merit pay, rather than a
reward for outstanding work.
Armstrong (2008) expresses job dissatisfactions and job quitting to be a result
of low motivation which may result into labor turnover. To him labour turnover
is the ending of employment relationship which may be voluntarily by someone
16
movmg elsewhere, or may finish at end of career or retirement. According to
Bwire (2008), labour turnover that may result from employee performance
problems which are driven by insufficient remuneration packages may be
voluntary or involuntary by nature (Tziner and Birati B, 2007). For example,
dismissal; these are terminations initiated by the company, it must be done
with great care and must be supported with a just and sufficient cause.
Dismissals are generally done as a last resort after all attempts at salvaging the
employee have failed. In addition, he attributes the cause of dismissals as
unsatisfactory performance, misconduct, absenteeism and tardiness which
may come up due to dissatisfactions in labour. The study will seek to find out
whether remuneration promotes employee performance or whether if
insufficient may encourage laziness and lead to dismissals.
Remuneration is asserted as a core aspect of any business and it is the
reasoning behind the age old barter exchange system for something of value in
return. Employees therefore agree to fulfill specific functions and duties for a
price. Hence their salaries or wages should be adequate. This is because
motivation is linked to this value exchange, thus required to reinforce behavior
and attitude towards work. Clint (2004), notes that the prospects of getting
higher pay elsewhere leads to low motivation and consequently low
performance by employees. This is one of the most obvious contributors to low
motivation, performance and turnover. According to Clint, this practice can be
regularly observed at all levels of the economic ladder, from executives and
generously paid professionals in high-stress positions to entry-level workers in
relatively low demanding jobs. However, different from Clint, Stewart (1994)
found out that there is evidence that money is often not the root cause of low
performances and turnover, even when it is a factor in an employee's decision
to quit. In this survey, the study compels for a justification of whether pay is
not the root cause of low performance by employees at Munyonyo Hotel.
17
According to Tziner and Birati (2007), it is acknowledged that when there is
competition in the labour market the demand for labour from different sources
of employment is also high, which leads to the quest for increased
remuneration and instabilities in labour especially when it comes to
professionalized labour force with a bargaining power. Thus Armstrong (1996),
found that turnover tends to be higher in environments where employees feel
they are taken advantage of, where they feel undervalued or ignored, and where
they feel helpless or not important. Clearly, if managers are impersonal,
arbitrary, and demanding, there is greater risk of alienation and turnover,
especially if labour force retaliates by retreating and absconding from duties
and no notice is taken by the management. Management policies can also
affect the environment in basic ways such as whether employee benefits and
incentives appear generous or stingy, or whether the company is responsive to
employees' needs and wants. Management's handling of major corporate events
such as mergers or layoffs is also an important influence on the work
environment afterwards.
Maicibi (2003) recognizes a challenge of job dissatisfaction when remuneration
is low. According to him, when the relationship between remuneration and
performance is negative the greater the dissatisfaction. Mullins (2005) also
asserts that low employee performance arises because of various factors
including dissatisfaction with job, low rate of wages and salary, unsatisfactory
working conditions, and non availability of adequate basic amenities. So there
is need for management to attend to all the above if they are to reduce on the
costs of production and interruption in the smooth flow of work since labour is
directly used in the production of goods and services.
However, reflecting on the above literature, it is clear that for most
remuneration packages which by nature are dissatisfying lead to low
performance which may result in the need for labour to find new jobs, but the
current study is entirely going to be premised on the impact of remuneration
on the available labour force performance.
18
CHAPTER THREE
METHODOLOGY
3.1 Introduction
This chapter explained the specific research methodology and techniques that
the researcher employed in order to obtain data. It involved the research
design, study area, population sampling strategies, data collection techniques
and data analysis techniques
3.2 Research Design
The study employed descriptive research design which was used with the help
of a cross sectional design approach.
3.3 Study Population
The study targeted a population 100 employees because it was a representative
of the whole staff population in the hotel.
3.4 Sample Population
The study sampled 50 employees from top management; middle, lower,
subordinate staff.
3.4 Sample Selection Technique
While conducting the study, the researcher purposively sampled top managers
so as to consider the different attributes and characteristics of the
respondents, such as the age of the children and their sex. The researcher
adopted a critical purposive sampling method because the group to be
contacted will be small compared to study population and yet a small number
of cases could still be decisive in expla ining the phenomenon of interest and
above all given the expected limitations in financial resources. Simple random
19
will be administered on waitresses/ waiters and laundry staff, Managers found
within the hotel premises at the time of interviews will also be randomly
consulted to avoid biases in sampling. This is because method gives every
single individual a single chance of selection. Stratified sampling will be applied
on the section heads as well as for the chefs because these supervise different
departments and head the cooking department respectively and thus all satisfy
the strata of this study with viable knowledge about their employee
performance in respect to remuneration at Munyonyo Common Wealth Resort
limited hotel.
Table 1: Sample Size
NO RESPONDENTS Populatio Size
n
1 Managers 5
3 Front desk employees 7
4 Section heads 6 -,---
5 Laundry Section 8
6 Waiters and waitresses 14 -·--
7 Chefs 10
TOTAL 100 50
Source: Munyonyo Common Wealth Resort Lrmrted Hotel (2014)
3.5 Sources of Data Collection
The research used both primary and secondary data.
3.5.1 Data Collection Methods
20
3.5.2 Primary Data
This was obtained through use of self administered questionnaires, interviews
and observations of the respondents at Munyonyo Common Wealth Resort
Limited Hotel.
3.5.3 Secondary Data
This was obtained from text books and other outstanding materials of different
scholars for instance journals, magazines, published and unpublished
documents, and internet sources were all referred to, to understand the issues
of remuneration management and labour performance.
3.5.4 Data Collection Instruments
Different study instruments will be applied for this study which will include the
questionnaire, interviews and documentary review.
3.5.5 Questionnaire
Both closed and open ended questionnaires were administered to a cross
section of respondents in order to aid and facilitate comprehensive data
collection. These questionnaires minimized biased and unwarranted responses
and also provided a lot of information as well as giving freedom to the
respondents to give out their detailed views.
3.5.6 Interview
The researcher organized informal interviews with the help of interview guide,
management and high profile staff to enrich the findings of the study. This was
done through a face to face interaction with the respondents where the
researcher posed questions relevant to the study and directly took note of the
answers. Interviews were selected because they are helpful in gathering in
depth information and for consistency to keep within the scope of the study.
21
3.5. 7 Documentary review
Hotel records that were found available on employee remuneration as well as
employee performance were accessed from the office of the Human Resource in
order to obtain detailed information to supplement the findings from interview
and questionnaires.
3.6 Data Collection Procedure
The researcher first of all acquired an introductory letter from the Dean of the
School of Business to present to relevant authorities Munyonyo Commonwealth
Hotel to allow her to carry out the research.
3. 7 Data Analysis
The researcher will explain describe and present the study findings as guided
by the specific objectives of the study and research questions. Data analysis
will initially be done through making quick impressionistic summaries of the
findings and conclusions will thereafter be made during the process of
collecting data. Quantitative data will be presented by use of statistics and
different graphs and will be further presented in columns in order to bring out
the study objectives as supported by thematic arrangement of questionnaires.
Qualitative data will be analyzed in summaries to support quantitative data as
backed up or contradicted by literature.
3.8 Ethical Consideration
The researcher will carry out the study after receiving full authorisation from
the management of Munyonyo Commonwealth Hotel. This will be upon
presentation of an introductory letter acquired from the University which will
be for purposes of request to conduct the research. The researcher will
thereafter make arrangements with selected respondents for interviews and for
collection of questions.
22
3.9 Limitations of the Study
In the process of conducting this study, the researcher anticipates some
challenges in data collection especially from the information that is to be
generated from official records handled by the human resource on pay.
However, the researcher will try to overcome this by presenting the letter of
introduction and providing assurance to the Human Resource Manager on the
necessity of the research and that it is purely academic.
The time available for research will be very limited, and yet respondents may
not be easily traceable given the fact that they work on rotational basis.
However the researcher will try to reach some of the employees through phone
calls to book for appointments for interviews.
23
CHAPTER FOUR
4.0 Data Presentation, Interpretation and Discussion of Findings
4.1 Introduction
This chapter presents and discusses findings of the study and draws
conclusions.
responded.
A sample of a
The sample
hundred respondents was targeted but only 50
considered only employees of Munyonyo
Commonwealth Resort Limited Hotel some respondents did not respond
especially those who were identified to fill questionnaires. In this part of the
study the researcher used tables and figures to present findings.
4.2 General findings
Here the findings were obtained from the general characteristics like gender,
age and level of education were discussed.
Table 2: Composition of sample by Gender
Details Frequency Percentage(%)
Male 20 40
Female 30 60
Total 50 100
Source: (Munyonyo Common Wealth, 2014)
24
Figure 2: Composition of sample by Gender
Composition of sample by Gender
• Male
• Female
The information in the table 2 above and figure 2 shows the gender
composition of the respondents. According to the fmdings, the total number of
male respondents was 40% and that of the female was 60%. This shows that
the female respondents were more willing to give information than the male
respondents.
Table 3: Age Groups of the Respondents
Details Frequency Percentage (%)
Below 25 8 16
26-30 10 20
31-35 15 30
36-40 12 24
Above 40 5 10
Total so 100
Source: (Munyonyo Common Wealth, 2014)
25
Figure 3: Age Groups or the Respondents
Age 10%
• Below 25
• 26-30
31-35
• 36-40
• Above 40
According to the information table 3 above and figure 3, 16% of the
respondents was below the age of 25 years, 20%b were with the age of 26-30,
30% were between 31-35, 24% were between the age of 36-40 and 10% were
above 40 years of age.
Table 4: Level or Education or the Respondents
Details Frequency Percentage
Masters 2 4
Degree 10 20
Diploma 15 30
Certificate 16 32
Others 7 14
Total 50 100
Source: (Munyonyo Common Wealth, 2014)
26
Figure 4: Level of Education of the Respondents
Level of Education
4%
• Masters
• Degree
Diploma
• Certifcate
• Others
According to the information table 4above and figure 4, the research found out
that 20% of the respondents were of degree level, 30% were of Diploma level,
32% held certificates 14% belonged to others and 4% of the respondents held a
masters degree. This implied that at the least most of the respondents had of
the respondents had attained a certain level of education and majority of the
respondents held certificate.
27
Table 5: Distribution of Respondents by Department
De taUs Frequency Percentage
Managers 5 10
Front Desk employees 7 14
Section heads 6 12
Laundry section 8 16
Waters and waiters 14 28
Chiefs 10 20
Total 50 100
Source: (Munyonyo Common Wealth, 2014)
Figure 5: Distribution of Respondents by Department
Distribution
10% • Managers
• Front Desk
Section heads
• Laundry
• Waiters/Waitress
• Chiefs
According to the results from the table 5 above and figure 5, 28% of the
respondents came from the waiters and waitress, 14% from desk employees,
16% from laundry section, 20% from chiefs and 10% from managers. This
implies that the majority of the respondents came from the waiters and
waitress who implement the remuneration policy and other departments.
28
4.4 Finding on the objectives of the study
Here the researcher discussed findings obtained from the study. The objectives
of the study were;
To examine the nature of remuneration m Munyonyo Common Wealth
Resort Limited as a business Organization
To establish factors that influence employee performance m Munyonyo
Common Wealth as a business Organization.
To establish the relationship between remuneration and employee
performance in Munyonyo Common Wealth as a business Organization
Nature of remuneration used by Hotel establishments
Remuneration 1s a tool used when motivating workers by business
organization. The study showed that the methods of remuneration of
Munyonyo Common Wealth were basic pay for standards hours. Additional
hours reward bonuses commission. Is further examined the effectiveness
(performance) of remuneration
Table 6: Effectiveness of Remuneration
Details Frequency Percentage
Good 25 50
Average 20 40
Poor 5 10
Total 50 100
29
Figure 6: Effectiveness of Remuneration
Remuneration
10%
• Good
• Average
Poor
According to the information in the table 6 above and figure 6 most of the
respondents said that remuneration was good at 50%, 40% said it was average
and 10% said it was poor. The study showed there fore that remuneration was
good with the percentage of 50% which is just below the average.
Table 7: Methods of remunerating workers
De tans Frequency Percentage
Basic pay for standard hours 22 44
Additional hours reward 6 12
Bonus pay 10 20
Holiday packages pay 7 14
Non monetary benefits 5 10
Total 50 100
Source: (Munyonyo Common Wealth, 2014)
30
Figure 7: Methods of remunerating workers
Methods
10%
• Basic pay
• Additional hours
Bonus pay
• Holiday Packages pay
• Non Monetary benefits
According to the information table 7 above and figure 7, most of the
respondents said that pay for standards hours is 44%, 12%said that it was
additional hours reward, 20% said it was bonus pay , 14% said holiday
packages and 10% said it was Non-monetary benefits. This implies that basic
pay for standard hours is the most used method of remunerating workers in
Munyonyo Common Wealth Resort since most of the respondents were in for it.
It also implied that non-benefits as a method rarely used in Munyonyo
Common Wealth Resort because few of the respondents went in for it.
4. 5 Factors which influence employee performance of benefits institution
or organization
31
' .. .. '
Table 8: Percentage of factors which influence employee performance in
Munyonyo Common Wealth Resort Limited
Details Frequency Percentage
Salary 20 40
Performance appraisal 10 20
Training and development 9 18
Welfare services 6 12
Working environment 5 10
Total 50 100
Source: (Munyonyo Common Wealth, 2014)
Figure 8: Percentage of factors which influence employee performance in
Munyonyo Common Wealth Resort Limited
Percentage factors
10% • Salary
• Performance appraisal
Training and development
According to the information table 8 above and figure 8, 40% of the
respondents said salary is a major factor that influences employee performance
in Munyonyo Common Wealth Resort Limited.
Hotel, 20% said performance appraisal, 18% said Training and development,
12% said welfare services and only 10% said working environment.
The study also showed that basic salary as a primary factor which influence
employee performance because most of the workers their are target workers.
Performance appraisal sis also used and performance reports are prepared
32
monthly. The study further showed that working environment rarely influences
performance at pride Micro Finance.
Table 9: Challenges to monitory performance
Details Frequency
Poor administration 21
Poor working environment 19
Rigidity among workers to change workers 10
Total 50
Source: (Munyonyo Common Wealth, 2014)
Figure 9: Challenges to monitory performance
Challenges
• Poor Adminstration
• Poor Working Enviroment
Rigidity
Percentage
42
38
20
100
According to the information in the table 9 above and figure 9, 4 2% of the
respondents said that the poor administration is a challenge to monitoring
performance, 38% said that the poor working and 20% said rigidity among the
workers to change. Most of the respondents said poor administration because
its administration that manages and monitors employees in order to perform. If
a hotel is led by poor administration it's likely to face poor performance among
employees.
4 .6 Findings on the relationships remuneration and employee performance
business organization.
33
Table 10: Relationships between remuneration and employee performance
in business organization
Details Strongly Agree Strongly Disagree Not Total
Agree Disagree Sure
Freq. Freq. Freq. Freq. Freq.
Position
Improve on employee 15 12 6 7 10 50
performance 30 24 12 14 20 100
Increased productivity 25 7 8 0 10 50
in terms of out put 50 14 16 0 20 50
Minimize on the cost of 8 10 15 12 5 50
recruiting other 16 20 30 24 10 100
workers
Negative
High costs of 16 10 7 2 15 50
im plantation and 32 20 14 4 30 100
management
Leads to reluctance 20 10 9 6 45 50
among workers. 40 20 18 12 10 100
34
CHAPTER FIVE
5.0 Discussion, Summary, Conclusion and Recommendation
5.1 Introduction
This chapter presents the discussion of the major study finding, summary of
the findings, conclusion and recommendations.
5.2 Discussion on the nature of remuneration used in Munyon yo Common
Wealth Resort Limited
With regard to this objectives majority for the respondents (95%) acknowledge
the effectiveness of remuneration on the performance of the institution. The
respondents reveled that various methods / ways that are used to remunerate
workers in the institution are effective due to good management.
This study is in agreement with www.buinsess case study.co.uk > Business
Theory > people> motivation which says that remuneration consists of rewards
that employees receive from their work.
Finding on the effectiveness of remuneration as a tool of motivating workers in
Munyonyo Common Wealth Resort Limited Hotel.
Majority of the respondents 40% revealed that effectiveness was good.
According to respondents, Munyonyo Common Wealth Resort Limited majority
cooks at remuneration or salary as a tool that motivates workers thus
Other methods as noted in this study included bonus pay with 20%
respondents. These revealed that bonus pay motivates /influence those who
have not been in position to even it to work hard in order to pay it hence
performance with in ht institution. Bonus pay is followed with addition I have
regards pay with 12%, holiday packages 14% and non monetary benefits which
showed that Munyonyo Common Wealth Resort Limited according to the
35
respondents doesn't use this method /way of remunerating workers (non
monetary benefits.)
5.3 Discussion on the factors which influence employee performance of
Munyonyo common wealth resort limited hotel.
Regarding this objective of the respondents (40%) noted that salary was the
primary factors which influence employee performance of the institution.
Respondents revealed that salary makes workers to be appreciated of the
services they offer and this makes them to be innovative and creative at work
leading to improved productivity and quality hence performance. This helps
Munyonyo common wealth to offer good quality services in terms of loans
services, saving services among others.
5.3.1 Other factors influencing performance found in Munyonyo Common
Wealth Resort Limited Hotel
The study reveled that performance appraisal had (20%) respondents.
Respondents revealed that monthly reports are general and these comprise of
names of employees along side their rates in terms of performance of that
month. The rates are in percentages.
They also reveled that training and development is also a factor (18%
respondents held this position), welfare services as another factor which
influence performance ensuring productivity hence performance. These
findings are in agreement with Byars and Rue {1994) which says that employee
remuneration IS being synonymous with compensation. They defined
compensation as all the exams reward for work done for example salary bonus
incentives and benefits. These motivate workers to perform.
Other respondents (40%) on this study reveled that remuneration was average
on being effective and 10% of the respondents revealed that the effectiveness
36
was poor findings on the methods jways mostly used in Munyonyo Common
Wealth Resort Limited Hotel when remunerating workers.
The study findings revealed theta basic pay for standards hours is the most
methods used when remunerating the workers with respondents (40%)
respondents reveled that this has motivated workers to work hard towards
achieving hotels goals and objectives since they are assured of there pay at the
end of the month since their set contract for payment. With performances is at
high rates hence development of Munyonyo Common Wealth Resort Limited.
This observation is in agreement with Need man (1997), according to need man
the principle of remuneration or rewarding employees for work done is through
pay "that there are many different jobs ad there are many different reasons why
people receive levels of payments
High costs of implementation and which reduce on the portfolio of the
institution lead while 30% revealed that remuneration leads to relating among
workers since they are assumed of the pay which leads to low output in terms
of services and payment.
5.4 Summary of the Findings
Based on the finding in chapter four, majority of the respondents in this study
were females (60%) while males were 40%. Majority of the respondents (30%)
were aged between 31-35 years. The findings on the distribution of respondents
by department showed that majority of the respondents by chefs (20%)
Regarding respondent's duration with the institution, majority of the
respondents (28%) had been waitress and waiter for more than five years but t
less than ten years.
According to the findings in the study, remuneration is a very effective tool in
ensuring performance of the institution.
37
Regarding the factors which influence employee's performance in Munyonyo
Common Wealth Resort Limited Hotel respondents revealed that; salary and
performance appraisals are the major factors that influence employee
performance.
Most of the respondents also revealed that remunerating has a position
impacts on the employee performance of business organization respondents
revealed that had 12% respondents. The study further revealed that looking
environment which had only 10% respondents. Respondents noted that
working environment comes as a by the way as far as production is concerned
in Munyonyo Common Wealth Resort Limited since every workers has task
targeted by top management.
5.5 Discussion on the relationship between remuneration an employee
performance in business organization.
With regard to this objective of the respondents performance 30% strongly
agreed that remuneration of them proves employee performance. Equally so
respondents revealed that the relationship between remuneration and
employee performance of business organization is very significant and position.
The findings revealed that remuneration increases position in terms of output
(50%) respondents agreed for this position as observed by saleemi (1998), he
said that for the efforts both physical and mal put in the process of producing
good and services.
Further more, other respondents 16% noted that remuneration mmimizes on
the costs of recruiting other workers since it's a form of society at work making
employees to stay at work thus perform.
Despite the positive relationship of remuneration on employee's performance of
business organization revealed by the majority of the respondents. Some
respondents revealed the negative relationship of remuneration on the
38
employee performance in business organization. To 32% of strongly agreed
that remuneration leads to stringent remuneration policy spell out procedures
for improving on employee performance, increasing productivity in terms of
output and minimize on the costs of recruiting other workers.
5.6 Conclusions
Basing on the findings in this study it can be concluded that the remuneration
policy has a positive relationships on the performance of business organization
and this depend to increased out put in terms of productivity. Limit on the
costs of recruiting other workers with in the organization or institution since
remuneration makes the workers of the organization secure and feel part of the
organization.
5. 7 Recommendation
The following recommendation is made basing on the findings in this study.
The researcher recommends that management of Munyonyo Common Wealth
Resort Limited ltd should identify and determine the appropriate factors that
influence employee performance in order to ensure quality out put and timely
results. This is to enable management to make timely decision and take
appropriate actions.
Management should also improve on the way of appra1smg employees by
putting appraising reports in time in order for an employee to know his or her
stand in productivity hence performance better in terms of out put and service
delivery.
As per the study, business organizations have to tackle and reduce the poor
management issues which majority affect the remuneration policy by
introducing effective and strict management which will follow remuneration
39
methods like bonus pay, basic pay method for standard hours, additional
hours reward, non-monetary benefits, performance relate pay among others.
5.8 Area for Further Research
The research suggests that further research should be carried out on the
effects of performance appraisal on employee performance in the organization.
Impact of remuneration on productively of the organization.
40
REFERENCES
Armstrong, M. (1996), A hand Book of Personnel Management Practice, Kogan
Page Ltd London.
Bwire, P. (2005). The Impact of Low Wage Payment on Labour Turnover.
Makerere University Library.
Chavan,S.(2010).Challenges Affecting Remuneration. Available at
http: I lwww.managementparadise.comlforumslhuman-
resourcesmanagementl 201092 -challenges-affecting-
remuneration.html [accessed on 22nd feb 20 11]
Glasscock, Sue, and Kimberly Gram (2005), "Winning Ways: Establishing an
Effective Workplace Recognition System." National Productivity Review,
Summer.
Kamukama, N.A. (2006). Cost and Management Accounting.
Maclean, B.and Stacey, C.(2009).Employee Turnover Causes and the Role of
Compensation. Available at
http: I I blogs.payscale.coml compensation I 2009 I 02/ ernployee-turnover
causes.html.
Mahendra, S. (2008). Human resource manageme11t: Factors influencing
remuneration. Presentation transcript: Available from
http:// www.slidenet/ sachin.mk/ factors-influencing-employee
remuneration.
Maicibi, N.A. (2003), Pertinent Issues in Employees Management. Kampala:
M.P.K Graphics (U) Ltd.
Maslow, A. (1970), Motivation and Personality, 2nd Eel. New York: Harper &
Row.
41
Milkovich and Newman (2005), Wages, Specific Training, and Labor Turnover
in U.S. Manufacturing Industries. International Economic Review Vol.
13, No. 1 (Feb., 1972), pp. 53-64.
Mullins, L.J. (2004). Management and Organizational Behavior,_5thEd.
Financial Times. London: Prentice Hall.
Parker and Burton ( 1970), Management Attitudes and Performance.
Parker, Owen, and Liz Wright (2001), "Pay and Employee Commitment: The
Missing Lin/c." Ivey Business Joumal.
Spitzer and Dean R (2000) Power Rewards: Rewards That Really Motivate
(Employee Incentives)." Management Review.
Stahl, M.J. (1995). Management. Total quality in a Global Environment,
Blackwell Publishers, Cambridge.
Staw, R. and Mowday, R. (1991).Employee Tumover and Post Decision
Accommodation Process, Blackwell Publishers, Cambridge.
Stewart, A.M. (2004). Empowering People. London. The institute of
management and Pitman Publishing.
Taylor, F.W. (1947). Scientific_Management. New York: Harper & Row
Publishers.
Tziner A. and Birati B. (2007), 'Assessing employee tumover costs: A revised
approach' Human Resource Management Review, val. 6(2), pp.113-
122.
42
APPENDIX I
QUESTIONNAIRE SCHEDULE
Questionnaire to the Respondents
Dear Respondent, I am a student of Kampala International University from the
College of Economics and Applied Statistics, carrying out an examination of
remuneration and employee performance in Munyonyo Commonwealth Hotel. I
kindly request you to answer the questions appropriately and as honestly as
possible. The information you disclose is strictly for academic purposes and
will be treated confidentially.
Instructions
Tick and explain where necessary
Personal data
1. Gender or the respondents
a) Male D b) Female D
2. Respondents level of education
a) Certificate D b) Diploma D c) Degree D d) Masters D e) Non of the above D
3. Position held .......................... , Remuneration ..................................... .
4. Period of service at the Hotel
43
a) Less than 1 year D b) 1-3 years D c) 4-6 years D d) 7-9 years D e) 10+ years D
Section B: Components of the Remuneration Package Structure
Remuneration forms adopted in Munyonyo Common Wealth Resort Limited
Hotel
Component
Disagree
Strongly Agree Agree Not Sure Disagree
I. Wages and Salary0 D D D 2. Leave D D D D 3. Incentives D D D D 4. Fringe benefits D D D D 5. Perquisite
D D D D In case of any other package please mention.
44
Strongly
D D D D
D
The following is the meaning of each abbreviation in the table;
Strongly Agree (1) Agree (2) Not Sure (3) Disagree (4) Strongly Disagree (5)
Question 1 2 3 4 5
6 The hotel has a clear salary scale structure that is well
known to the employees
7 Management endeavors to explain any challenging
changes in remuneration
8 I receive a fair remuneration package compared to my
input
9 Hotel regularly makes remuneration incremenLs
reflecting on economic and market changes
9 I am motivated by remuneration compared to other
hotels around
1 We meet with management to discuss remuncraLion
0 dissatisfactions
1 Management remunerates employees for exLra Lime
1 loads
1 The hotel encourages skill developmenL and Lraining as
2 a way forward for improved benefiLs -
45
Section C: Factors Influencing Employee Remuneration
Question 1 2 3 4 5
13 Munyon yo Commonwealth Hotel remunerates its
employees for unique performance
14 The hotel undertakes performance appraisal
before determining how much it pays to who
15 Workers remuneration relies heavily on contract
16 Incentives are provided to motivate employees
Section D: Remuneration and Employee Performance
Question 1 2 3 4 5
17 A reduction in wages and salaries leads to low
performance contribution
motivates I 18 Provision of incentives to workers
them and hence increases their labour
contribution
19 Remuneration package lS sufficient and has
increased employee productivity
20 We expect to increase employee productivity if
our remuneration is increased
21. Have you ever worked with another hotel before?
a) Yes D b) No D
22. If yes, why did you leave that hotel establishment?
a) Poor remuneration D
46
b) Work environment D c) Poor relationship with management D d) Other specify ............................................................................. .
23. What do you think is the major cause of poor employee
performance at this hotel?
24. In your opinion what should be done to improve employee
productivity as induced by remuneration?
... Your Contribution is Greatly Acknowledged ...
47
APPENDIX II
INTERVIEW GUIDE
Dear Respondent, I am a student of Kampala International University from the
College of Economics and Applied Statistics, examining remuneration and
employee performance at Munyonyo Commonwealth Hotel. I kindly request you
to answer the questions appropriately and as honestly as possible. The
information you disclose is strictly for academic purposes and will be treated
confidentially.
1) For how long have you worked with this hotel?
2) Does the hotel have a clear remuneration scale structure that is well known to the employees?
3) Do you receive a fair work pay?
4) Do you think the management of remuneration has influenced low employee performance in
any way?
5) How would you advise management on remuneration?
6) Does management get some complaints about employee remuneration?
7) What kind of complaints does it receive?
8) Does the hotel make regular pay increments reflecting on market price changes?
9) How do you rate the level of employee performance in relation to remuneration received?
I 0) Does Management pay equal pay for equal work?
II) Does management hold meetings to discuss remuneration concerns?
12) What do you think is the major cause oflow employee performance in this company?
13) In your opinion what should be done to improve employee performance reflecting on the
remuneration challenges encountered?
48
Year (2014)
Beginning of Apl"il
Mid April
Beginning of May
..
Mid May
End ofMuy
APPENDIX III
TIME FRAME
APPENDIXB
TIME FRAME.
Activity
.
Proposul Writing und Editing
Gathering information from respondents
Analyzing and Compiling Data collected
-- ~ ~
Typing and editing report
Submitting ofthe full report
·- .
APPENDIX III: PROPOSED BUDGET
Item Particulars Quantity Cost I Unit Amount
Stationnry Duplicating paper 1 ream 15,000 15,000
Pens 20 1000 20000
Notepads 5 1000 5000
Field work and Transport 20,000
data gathering Phone calls 2 credit cards 10,000 30,000
purposes
Data entry
assistants 2 2000.0 40,000
Report writing Typing and 500@ Approx 60 30,000
printing
3 copies 13 24,000
Binding costs I
I Miscellaneous 50,000
I Total 234,000
I
50
