Effects Of Reward Systems On Employee Work Attitudes In The Energy Sector In Kenya

Abstract

The business environment today being very competitive, a good compensation system for any organization is essential as it directly impact the performance of its employees. Compensation is assumed to be a physical need which in turn affects the employees’ motivation as well as the attitude they have toward the job they as well as the overall image of the organization. Since compensation is basic and at the bottom of the Maslow’s hierarchy of needs, without it achieving self-esteem for any employee is a far out of sight and self-actualization is beyond the horizon. reward affects the job performance and it also affects the relationship between the employee and the employer as well their perception towards the growth of the organization as well individual growth. The energy sector has thousands of employees, since the sector is crucial in moving the nation towards vision 2030 goals, a good reward system is crucial to ensure satisfaction of the employees as key stakeholders’ in the sector. How these employees behave towards their jobs and their perception towards a particular organization are dependent on the rewards they receive. Thus, the study aimed to identify the relationship between reward systems and employees’ attitudes in the energy sector in Kenya. Specifically, the study examined: recognition rewards, monetary rewards, skill-based pay and empowerment rewards and their influence on employee work attitudes. The theories underpinning the study include: The Equity theory, Expectancy Theory, Agency Theory, and the Social Exchange Theory. The target population comprised of 2090 staff from electricity sub sector in Kenya comprising of: Nuclear Power and Energy Agency, Kenya Electricity Transmission Company, the Rural Electrification and Renewable Energy Corporation, Geothermal Development Company, and the Energy and Petroleum Regulatory Authority. A sample size of 336 was drawn comprising of respondents in strata of top management, middle management, and junior employees however, on 281 questionnaires were returned giving a response rate of 83.6%. The study used both descriptive and inferential statistics. Diagnostic tests were done to ascertain violation of critical assumptions. Multiple Regression was done to determine how rewards systems relate to employee’s attitude in the energy sector. The study found that all the independent variables i.e. recognition rewards, skill based pay, monetary rewards, and empowerment rewards significantly influenced employee work attitudes in the energy sector in Kenya. Rewards system was found to explain 55% variation of employee work attitudes. The study recommends for an elaborate rewards system to be done by organizations to ensure employees feel motivated, committed, and achieve with job satisfaction. Similar studies should also be done in other organizations to ascertain the remaining variation in employee work attitudes.