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THE EFFECT OF SHORT TERM EMPLOYMENT CONTRACTS ON STAFF MOTIVATION IN NIGERIA

CHAPTER ONE

INTRODUCTION

1.1     Background to the Study

Employees are the most important asset a company has. They are the face of the company and the most visible part to customers. For employees to do their job well, they need to be motivated and interested in what they are doing. Things that are usually believed to motivate people in their working life are career advancement, pay, coworkers, challenging and interesting work projects, and the stability a job brings to life. Employees, who work on a temporary basis lack most of these “normal” motivators. Because of this the question of what motivates temporary employees, arises.

Concept of Contract job was introduced in1970’s when unemployment in Europe was rise. In 1980 this was established at 80% in France and up to 90% in Spain. Since the 1980s, many organizations have changed their business operations (Handy, 1995). Temporary job plays a major role in total employment. It is projected that, in 2001, contract workers made up about 9.4% of the total workforce The Bureau of Labor Statistics (2001). Contract job practice has been increasing in a number of countries. (cf. OECD 2002, Booth ET al.2002a).This high rate is due to less risk for firm. Employee’s performance has positive relation with job security. Contract base employees are easy to hire and terminate. These employees are hired in case when there is a need of employees like seasonal work or increase in demand and after end of these conditions these employees can be terminated. Employees wish that they distinguish as being fair and equal with their skills and expectations.

Some firms use the short term employment condition as a pseudo-probationary period to preview workers from whom they screen out those who fail to meet performance criteria or do not otherwise “fit” the organization, or extend an offer of long-term employment to desired individuals (Druker and Croucher, 2000). Such firms may find significant benefit in developing a stronger, more meaningful employer-employee relationship with their short term workers. Individuals‟ inspiration to enter the short term labor market vary broadly and at times include the inability to secure more desirable or permanent work, or a desire or need for retraining or for greater choice in when and where to work. On the other hand, a large number of them do so with the implied hope of obtaining an offer for longer-term employment (Foote and Folta, 2002). In some cases, the aspiration for longer-term employment stems from a perception on the part of lenders that, because their income source is less stable, short term workers represent a high financial risk, and these short term workers want to avoid being seen as high-risk investments.

Notwithstanding improvements in some areas, industry groups still appear to be unenthusiastic to fully incorporate short term employees, as evidenced by the European Union‟s recent failure to reach agreement over the drafting of the Agency Workers‟ Directive. The directive, which appeared to have secured the support of most European partners, was attempting to improve the rights of short term workers (Donkin, 2003). Short term employment grew significantly over the last decade, accounting for 10 percent of net employment growth in the United States during the 1990s. Evidence from case studies and business surveys suggests dramatic growth in the outsourcing of functions to contract companies as well (Houseman, 2001). Elements such as the technologies used in the productive process, the specialization of the workforce and niches of development are just examples of the diversity of aspects that have been in constant change so far. Short term employment is part of the phenomenon of short time employment, often seen as a consequence of a major push by governments and employers in industrialized countries to develop more flexible labour markets and to reduce labour costs (Golden and Appelbaum, 1992, cited in Rogers, 2000). An alternative view, however, is that the short term employment industry itself is actively engaged in promoting its own growth and preventing regulation (Gono, 1997, cited in Rogers, 2000).

1.2     Statement of the Problem

Despite of the fact that there has been considerable growth in short term employment in organizations across the globe, the growing body of research remains largely limited to employees (typically referred to as permanent employees) hired with an expectation, on the part of both employer and employee, of relatively long-term employment, whether full or part-time. Very little research links progressive human resource management practices and systems to the management of workers hired on a short term basis and staff motivation.

Staff nowadays are not that motivated to work like before due to the mode of employing in some organizations most especially financial institutions, they hire most of their staffs on contract basis majorly two years and after that they dumb them, all this contributed to weariness of most employees and they are not motivated to give the employer their best since they know they might not be retained after their contract. Several authors (De Cuyper, De Jong, De Witte, Isaksson, Rigotti, & Schalk, 2008) suggest that short term employment may be a source of negative outcomes for both individuals and the organization, therefore this research intends to research on the effect of short term employment contract on staff motivation in Nigeria.

1.3     Objective of the Study

The main objective of this study is to find out the effect of short term employment contract on staff motivation in Nigeria, specifically the study intends to:

1.     Find out the effect of short term employment contract on staff productivity

2.     Analyze the effect of short term employment contract on employee motivation to perform better.

3.     Examine the factors that motivate short term contract staff in Nigeria.

1.4     Research Question

1.     What are the effect of short term employment contract on staff productivity?

2.     Is there any significant effect of short term employment contract on employee motivation to perform better?

3.     What are the factors that motivate short term contract staff in Nigeria?

1.5     Research Hypothesis

Ho: there is no significant effect of short term employment contract on employee motivation to perform better

Hi: there is significant effect of short term employment contract on employee motivation to perform better

1.6     Significance of the Study

This research work will be of significance to organizations especially financial institutions on how to motivate their contract staff so as to get an hundred percent job performance from them and this will definitely affect the organizational growth. This research work will also expose employees on the benefits and effects of contract employment and also proffer some tactics that will make their employer employ them permanently.

Finally this research work will serve as guide and reference point for other research on the same topic.

1.7     Scope of the Study

This research will conducted in Ogun state, Ado-Odo Otta LGA, a branch of GT Bank will be used as a case study for this research.

1.8     Delimitation of the Study

Finance for the general research work will be a challenge during the course of study. Correspondents also might not be able to complete or willing to submit the questionnaires given to them.

However, it is believed that these constraints will be worked on by making the best use of the available materials and spending more than the necessary time in the research work. Therefore, it is strongly believed that despite these constraint, its effect on this research report will be minimal, thus, making the objective and significance of the study achievable.

1.9     Definition of Terms

Short term employment: workers who hold explicit or implicit contracts of employment which are expected to last longer than the period.

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