Monetary Reward : A Predictor of Employees ’ Commitment to Medium Scale Organizations in Nigeria

This study investigates monetary reward as a predictor of the commitment of employees in medium-scale organizations in Nigeria. A total of 160 employees comprising of 85 male and 75 female participated in this study. The participants were randomly selected from four medium-scale organizations in Ekiti and Ondo states of Nigeria. Their age ranges between 26 years and 50 years with a mean age of 38 years. Questionnaire was used to collect data from the participants, while t-test for independent groups was used to test the three hypotheses for this study. Result however revealed that no significant difference exist in the commitment level of more tenured and less tenured employees in monetary reward. Equally, no significant difference was found in the commitment level of male and female employees in term of monetary reward. Result also revealed that high educated employees have no significant difference in their commitment level with that of low educated employees. Introduction Encouraging employees to work and be committed to organization toward achieving organizational goals and objectives is one of the most significant challenges for any management team (Floyd & Wooldridge, 1994:49; Guth & Macmillan, 1986:303). The continuous survival of any work organization requires the cooperation of labour with the other factors of production such as land and capital. Organization commitment refers to the relative strength of an individual’s identification with, and involvement in an organization (Mowday, Porter, & Steers, 1982:145). It is characterized by a strong belief in, and acceptance of the organization’s goals and values, a willingness to exert considerable effort on behalf of the organization, and a strong desire to maintain membership in the organization (Porter, 1968:52). It involves active relationship with the organization in which individuals are willing to give something of them in order to help the organization succeed and prosper (Meyer & Allen, 1997:60). According to March and Simeon (1958:52), real commitment often evolves into an exchange relationship in which individuals attach themselves to the organization in return for certain rewards or outcomes. Employees’ commitment reduces turnover but increases performance (Angle & Perry, 1981:12), and employee can only be committed when their needs are met and fulfilled by their organizations (Maslow, 1954:122). Maslow (1954) human needs are arranged in a hierarchical order, and once a need is satisfied, the individual move to the next unsatisfied need which now • Department of Psychology, University of Ado-Ekiti, Nigeria.Email: droluomolayo@yahoo.com •• Department of Psychology, University of Ado-Ekiti, Nigeria. Bangladesh e-Journal of Sociology. Volume 4. No. 1. January 2007. 43 forms the basic for his/her behaviour. These needs are the physiological needs (which include food, clothing, shelter, water, and sex), security needs (such as job security, protection of life and property), social needs (such as need for affection, friendship, and sense of belonging), esteem needs (which include need for recognition, accomplishment, achievement, and self respect), and self-actualization needs (which is the need for an employee to reach his/her highest potential at workplace in conquering his/her environment). However, one of the basic conditions of employment to satisfy and fulfill these human needs at work organizations is monetary reward (that is, wages and salaries) which is pay. Monetary rewards are something given or obtained in return for work done or service rendered. Vroom (1964:134) asserts that the expectation (reward) of employees on task performed motivates and encourages them to be committed. Thus, the higher the expectation of workers, the greater the commitment. On the other hand, the lesser the expectation of workers, the lower the commitment (Martin & Shawn, 1984:273). In their study of antecedents of employees’ commitment, Mowday, Porter & Steers (1982:153) found that more tenured employees are more committed than less tenured employees. They also found that women tend to be more committed as a group than men (1982:155), and that highly educated employees tend to be less committed than less educated employees (1982:157). Studies have shown that position; job tenure and organization tenure have a significant relation with employees’ development activity and commitment, and that tenure on the job and in the organization has positive relationship with employees’ commitment (Kozlowski & Farr, 1988:361; Luthan, McCaul & Dodd, 1985:240). Oloko (1972:40) found that Nigerian workers are committed and motivated to work in organizations managed by fellow Nigerians in which they foresee their opportunity for promotion and advancement as limitless more than organizations that are managed by foreigners where advancement is difficult to achieve. Hypotheses The following hypotheses were tested: 1 There will be a significant difference in the level of commitment of more tenured and less tenured employees in term of monetary reward. 2 There will be a significant difference in the commitment level of male and female employees in monetary reward. 3 There will be a significant difference in the commitment level of highly educated and low educated employees in monetary reward. Bangladesh e-Journal of Sociology. Volume 4. No. 1. January 2007. 44 Research Methods Research Design Descriptive research design was adopted. Survey method was equally used through the use of questionnaire to generate data. Monetary reward serves as independent variable while employees’ commitment to organization is the dependent variable. Participants 160 employees participated in this study, comprising of 85 male and 75 female. Their age ranges between 26 years and 50 years with a mean age of 38 years. The participants were randomly selected from four medium-scale organizations in Ekiti and Ondo states of Nigeria. The selected organizations are, Odua Textile Industries and Omolayo Industries in Ado-Ekiti, all in Ekiti state; Coop Cocoa Products Industries in Akure and Stanmark Cocoa Processing Industries in Ondo, all in Ondo state. Instrument A 36-item questionnaire in Likert form of Strongly Agree (SA) to Strongly Disagree (SD) was used to generate data for this study. The pilot study of the instrument conducted by the researchers shows a split-half reliability coefficient of 0.57 and a construct validity coefficient of 0.60. Amongst the items of the questionnaire are: i) This organization treats its employees better in terms of monetary reward. ii) Increase in employee’s wages and salary brings dedication and commitment. iii) I am satisfied with my present pay. iv) I prefer monetary reward to free accommodation. The items were scored as follows: Strongly Agree – 5 points Agree – 4 points Disagree – 2 points Strongly Disagree – 1 point Procedure Personal visit was paid to the four organizations where the instrument (questionnaire) was administered personally and directly to the randomly selected employees used for this study. The participants were in the middle cadre of the organizational chart. They include the personnel officer, administrative officer, laboratory officer, technical officer, senior clerical officer, senior typist, secretary among others. Data Analysis To test the three hypotheses for this study “t-test” for independent groups was used. Bangladesh e-Journal of Sociology. Volume 4. No. 1. January 2007. 45 Results The results of data analysis are presented in table form below. Hypothesis 1: There will be a significant difference in the level of commitment of more tenured and less tenured employees in term of monetary reward. Table 1: “t-test” Summary Table Showing the Commitment Level of More Tenured and Less Tenured Employees in Monetary Reward. Sex N X df t-ob t-cr p More tenured employees 58 53.0 158 0.104 1.960 <. 05 Less tenured employees 102 53.1 t (158) = 0.104, p<. 05 Source: Authors’ Survey Result in Table 1 shows that no significant difference exists in the level of commitment of more tenured and less tenured employees in monetary reward. Therefore, the first hypothesis is not accepted. Hypothesis 2: There will be a significant difference in the commitment level of male and female employees in monetary reward. Table 2: “ t-test” Summary Table Showing the Commitment Level of Male and Female Employees in Monetary Reward. Sex N X df t-ob t-cr p Male 85 52.5 158 1.406 1.960 <. 05