Unpacking the 'black box' in the relationship between pay-for-performance, employee benefits and performance Online publication date: Wed, 02-Jan-2019
by Abdussalaam Iyanda Ismail; Abdul Halim Abdul Majid; Mohd Hasanur Raihan Joarder
J. for Global Business Advancement (JGBA), Vol. 11, No. 4, 2018
Abstract: This research examined the effect of pay-for-performance (PFP) and employee benefits on employee performance with mediating effect of distributive fairness in the nexus. Through a cross-sectional approach, data were collected from a sample of 140 Nigerian employees. Partial least squares (PLS) method algorithm and bootstrap techniques were used to test the study's hypotheses. The results provided support for all the hypothesised nexuses indicating that PFP and employee benefits influence the performance of workers positively. Also, the result showed that distributive fairness mediates the relationship between PFP and employee performance, and between employee benefits and employee performance. The implication is that PFP and employee benefits can boost and enhance employee performance provided distributive fairness is perceived in the reward system that is operating in the firms. Hence, distributive fairness is an inextricable element in any reward system. Limitations and recommendations are discussed.
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