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A study examining the effect of employee welfare, communication, employee participation, and grievance resolution on organizational performance at Nairobi City Water & Sewerage Company in Kenya. The research found that these components significantly influence organizational performance and suggests strategies to strengthen them.
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This research project submitted to the Department of Business Administration, Kenyatta University is my original work and has not been presented for a degree in any other university. Consequently, no part of this work should be copied without permission of the author and or Kenyatta University. ……………………. ……………………… Signature Date Wangila Rose Naliaka D53/CTY/PT/24103/ Supervisor I confirm that the work presented in this research project was carried out by the candidate under my supervision. ……………………………………. …………………………….. Signature Date Dr. David Kiiru Lecturer Human Resource Department School of Business Kenyatta University
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First and foremost, I wish to thank the almighty God for his love, blessings, favors, gift of healthy life, and the opportunity to be. May all the glory and honor be to his name always. I wish to sincerely thank my supervisor Dr. David Kiiru for his support, guidance, encouragement, patience, availability for consultation at short notices and understanding. May the Almighty God bless you all abundantly and grant you desires of your hearts. Sincere appreciation goes to Nairobi City Water & Sewerage Company management for granting authority to conduct this research at their institution and staff for availing their time to provide the data required for this project in good time. I would like to thank my mother Mrs. Violet Wangila for her persistent encouragement and push to finish the Masters programme. Finally, my sincere appreciation goes to my husband for the encouragement when it looked hard and my children Dama and Lisa, for asking me constantly when I would graduate, the question ignited the little energy in me to work even harder. To baby Adriana, you literally did not understand what kept me busy on the laptop, a copy of this document will be preserved for your future reference in your academic work and appreciation.
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DECLARATION......................................................................................................... ii DEDICATION............................................................................................................ iii ACKNOWLEDGEMENT ......................................................................................... iv TABLE OF CONTENTS ............................................................................................v LIST OF TABLES ..................................................................................................... ix LIST OF FIGURES .....................................................................................................x LIST OF ABBREVIATIONS ................................................................................... xi OPERATIONAL DEFINITION OF TERMS ........................................................ xii ABSTRACT .............................................................................................................. xiv CHAPTER ONE: INTRODUCTION ........................................................................ 1 1.1 Background of the study ................................................................................................. 1 1.1.1 Employee Relations Strategies ............................................................................ 2 1.1.2 Organization Performance of Water and Sewerage Companies in Kenya .......... 6 1.1.3 Profile of Nairobi City Water and Sewerage Company....................................... 9 1.2 Statement of the problem .............................................................................................. 10 1.3 Objectives of the study .................................................................................................. 13 1.3.1 General Objectives ............................................................................................. 13 1.3.2 Specific Objectives ............................................................................................ 13 1.4 Research Questions ........................................................................................................ 14 1.5 Significant of the study ................................................................................................. 14 1.6 Scope of the Study ......................................................................................................... 15 1.7 Limitations Of the Study ............................................................................................... 15 1.8 Organization of the study .............................................................................................. 16 CHAPTER TWO: LITERATURE REVIEW ......................................................... 17 2.1 Introduction ..................................................................................................................... 17 2.2 Theoretical Review ......................................................................................................... 17
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Figure 1: Conceptual Framework ............................................................................................ 32
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AWSB Athi Water Services Board CBA Collective Bargaining Agreement ER Employee Relations HR Human Resources HRM Human Resources Management ILO International Labor Organization ISO International Standards Organization KPI Key Performance Indicator MD Managing Director NCC Nairobi City County NCWSC Nairobi City Water and Sewerage Company WASREB Water Service Regulatory Board OSHA Occupational Safety Health Act PPE Protective Personal Equipment
xiii Organizational performance This is the result or the output of the organization that are a measure on the goals and objectives measured in term of efficiency, revenue growth and customer satisfaction.
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Employee relations is one of the key fundamental elements of organizational performance, prosperity and sustainability. Since good employee relations results in a highly committed, motivated and loyal employees there is need for organizations to develop strategies that will improve performance. Employee relations strategy involves decisions and actions made by the management affecting the way in which the organization relates with its employees. The general objective of this study was to establish the effect of employee relations strategies on the performance of Water and Sewerage service providers in Nairobi Kenya. The Water and Sewerage service provider under study was Nairobi City Water & Sewerage Company, Kenya owing to the fact that it is the largest service provider both in Nairobi and Kenya based on customer base and revenue turnover hence the findings were generalized to the entire population. The study was guided by the following specific objectives; To examine the effect of employee welfare, communication, employee participation and grievance resolution mechanism on the performance of Nairobi City Water & Sewerage Company, Kenya. The study was anchored on four theories; unitarist, pluralist, system and process theories. The study employed a descriptive design. The target respondents were 3534 staff cutting across all cadres. Stratified random sampling was applied to select 10% of respondent from each stratum of; senior managers, middle level managers, supervisors and support staff thus sample population was 354.Primary data was collected using structured questionnaires and analyzed using descriptive and inferential statistics and the results presented in tables. The study found that employee welfare, communication, employee participation and grievance resolution as components of employee relations strategies significantly influence organizational performance at Nairobi City Water and Sewerage Company, Kenya and therefore various strategies to strengthen these components of employee relations strategies should be explored and put in place. The multiple regression analysis results indicated that variations in employee relations strategies discussed that is; employee welfare, communication, employee participation and grievance resolution explains 54.8% of the variations on organization performance at Nairobi City Water and Sewerage Company Kenya meaning the other employee relations strategies for training, recruitment among others that influence performance of Nairobi City Water and Sewerage Company. The study recommended that a similar study should be carried out in various organizations in other sectors of the economy to complement the findings.
Any business organizations’ success greatly depends on management and employees’ relationship. Employee commitment, productivity and loyalty is important role in the growth of the organization in a business environment that is competitive. In order to achieve a healthy and strong relationship between the workforce and organization, well-organized strategies on employee relations should be established. The relationship between employers, trade unions and employees, communication, management of disputes and grievances is a key drive of competitive firms operating in the dynamic business environment (George and Jones, 2008). 1.1.1 Employee Relations Strategies Employee relations strategies encompasses all management decisions and actions that affect the nature of the relationship between the employer and its employees (Beer and Spector. 1985; Boxall and Purcell. 2000). The term employee relation has been used synonymously with industrial relations and employment relations. According to (Lewis et al., 2003) Industrial Relations is associated with the declining “Smokestack” industries and blue collar workers and the accompanying emphasis upon Collective Bargaining Agreements between employers and Trade Unions. Employee relations suggests a wider employment canvas being covered with equal importance attached to none union employment arrangements and white collar jobs. It is concerned with the social economic relationship that forms and revolves around a contract between the parties to perform work in return for employment benefits such as remuneration (Perkins & Shortland, 2006). The emphasis on both employee relations and industrial relations is on participation, process and practices (Salamon, 2000; Lewis et al., 2003).
Employment relationship is an economic, social and political relationships where employees provide manual and mental labour in exchange for rewards by employers (Lewis, Thornhill & Saunders, 2003). Due to increased global competition over the last three decades, organizations have emphasized on labour efficiency and cost control (Perkins & Shortland, 2006). This has called for effective employee relations strategies that enable the employees to dedicate their energy to the achievement of organizational goals. Firms actively seek good employee relations whether or not they are bound by union contracts. Proactive steps in anticipation of employee needs and expectations are therefore characteristic of strategic managers (Pearce and Robinson (2009). Organizations should strive to satisfy their employees with good pay, good supervision and good stimulating work (Pearce & Robison, 2009). Employee satisfaction is related to customer satisfaction. Industrial Relations system in Kenya is anchored on the International Labour Organization’s Convention No.150 of 178 on Labour Administration. Kenya joined the ILO in 1949.This is domesticated through the Industrial Relations Charter (1984) and the Labour Relations Act (2007). The system envisages that such consultations start at the shop floor levels, cascading to the national levels. Odhong, Were and Omolo (2014) indicates that the role of industrial relations institutions is to promote social dialogue and industrial harmony. Employee participation is about employee involvement in matters concerning the organization. Participative management entails encouraging employees to take part in the decision making process influencing the organization. Armstrong (2006) holds that employee participation and empowerment generally creates a climate of trust and
Very important is grievance resolution mechanism in organization in whichever form whether through arbitration, through joint consultation with union and ensuring prompt resolution of a case. Grievance and conflict among employees in an organization is inevitable. Mesh ’al (2001) suggests that grievance is an inevitable natural part of the dynamics of workplace including the most solid ones. People perceive differently situations and will try to persuade others to think as them. Thus, grievance occur frequently when there are open communication barriers, when you feel a perceived threat or one that is real to your status of employment or when targets of workplace are not met by an individual. If unmanaged, conflict becomes destructive and highly negatively impact employee productivity and the organizations’ success. If employers start understanding the cause and how to react to conflict, they thrive more in the managing and prevention of future conflicts (Gazioglu and Tansel, 2006). Disputes can arise due to misunderstandings or mistakes and poor communication and decision making, tensions or personal difficulties, breaches of trust or of the law, infringements of personal dignity or human rights, inability or unwillingness to perform allocated work and unacceptable behavior. Dispute affect morale, reduce productivity and ultimately undermine organization performance and growth. (Ngari and Agusioma,2016) Related to employee relations is welfare of employees at work place that includes safety and health, wellness programmes like canteen, sports and financial security like retirement, loans, mortgages among others. Employees no longer are attracted to job security and salary but the whole package of welfare programmes. There are three reasons why organizations should be concerned with the well-being of their employees. First and most importantly, they have a duty of care and this means adopting a socially responsible approach to looking after their people. Second,
employers are responsible for creating a good work environment not only because it is their duty to do so but also as part of the total reward system. Third, it is in the interests of employers to do so because and help to establish it, as a best place of work. (Taylor 2008). According to Kahns model (2011) employee welfare schemes are those measures that aims at promoting physical, psychological and general wellbeing of the working class. Maslach et al., (2012) states that welfare schemes include some or all of the amenities provided in or near the organization and related to the working and living conditions. These facilities include canteens and nourishment facilities, transport arrangements, recreational services, housing schemes, education and training of employees, pension, bonus, medical facilities, childcare facilities, alcohol drug and substance support facilities etc. According to Ngui (2016) performance of organizations that maintained good employee relations according to the responses from employees and based on number of conflicts reported, communication and involvement in decision making over a period of five years compared to the organizations that did not have good employee relations had higher performance in terms of market share, loan sales, revenue, financial strength, return on equity, return on investment and profitability. It thus implies that today employee relations in Kenya is more about involvement, engagement, participation, communication, decent employee welfare and sound dispute and grievance resolution among other strategies. 1.1.2 Organization Performance of Water and Sewerage Companies in Kenya Water is the most important natural resource, indispensable for life and at the same time the back bone of growth and prosperity for mankind. Just like food, water is a basic human need which is also a fundamental right that Kenyan citizens need to enjoy without any limitation. The constitution of Kenya in Article 43(1) (d) states that
