THE EFFECT OF NEW MINIMUM WAGE ON EMPLOYEES TURNOVER INTENTION IN PUBLIC ENTERPRISE

THE EFFECT OF NEW MINIMUM WAGE ON EMPLOYEES TURNOVER INTENTION IN PUBLIC ENTERPRISE

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                                                               CHAPTER ONE

                                                              INTRODUCTION

1.1    BACKGROUND TO THE STUDY

Organizations invest a lot on their employees in terms of Induction and training, developing, maintaining and retaining them in their organization. Therefore, managers at all costs must minimize employee's turnover. Although, there is no standard framework for understanding the employees turnover process as whole, a wide range of factors have been found useful in interpreting employee turnover, one of such crucial facto is pay (Kevin, 2004).

 Pay reform has been an important issue in public service management throughout the world over the past two decades. Pay is a significant feature of human resources management, and these resources are the most crucial factor in the delivery of public services. The economic crises and the attendant deterioration in service delivery that confronted most governments in the 1970s and 1980s have brought public service employment and pay reform at the fore of the policy agenda in virtually every country, except the mineral-rich exporters, since the early1980s (Kiragu, 2003).

Minimum wage issues have been a major factor in the determinant of workers stay on the job in the Nigeria public sector. However, the extent to which workers is satisfied on the job is also another area of interest in public discuss. Therefore, this study shall be conducted to examine the effect of minimum wage administration on worker turnover in the civil sector.

 1.2    STATEMENT OF PROBLEM

The minimum wages payable to civil servants in Nigeria has been review over the years in a bid to better the lots of the public service workers. However, the review has been met with several confrontations which often led to series of industrial actions led by the labour unions in the country.

Recently, the federal government introduces the new minimum wages designed to offer workers a basic pay of #18,000. This had generated several controversies as well as many crisis in form of strike actions, absenteeism, sabotage and many more on the part of the workers.

In the heart of the controversy is the fact that some state government have refused to honour the agreement. The Lagos State government is one of those states with strong argument against the payment of the new minimum wage.

It is therefore pertinent to investigate how the new minimum wages have affected employee turnover in the Lagos state civil service.

 1.3    OBJECTIVES OF THE STUDY

The primary objective of the study is to examine the effect of the new minimum wage on employees' turnover in Lagos State. However, the specific objectives shall include:

  1.      i.        To examine the relationship between minimum wage and employee turn over in the public sector.
  2.     ii.        To assess the effect of failure to honour the new minimum wage legislation on the performance of workers in the public sector.
  3.   iii.        To investigate the role of Labour unions in the wages and salary administration in the public sector.
  4.   iv.        To find ways by which cnsrs relating to mimmum wages administration can be resolve.

 1.4    RESEARCH QUESTIONS

The following questions shall guide the study:

  1.      i.        Is there any the relationship between minimum wage and labour turnover in the public sector?
  2.     ii.        What is the negative effect of failure to honour the new minimum wage legislation on the performances of workers in the public sector?
  3.   iii.        What are the role of Labour unions In the wages and salary administration in the public sector?
  4.   iv.        In what ways can the Crisis relating to mmimum wages administration be resolve?


·         To see the mechanisms used by the enterprise to reduce the turnover rate.

1.5 Scope/Delimitations of the Study

The scope of the study is limited only to Public Enterprise called Lagos water  corporation(LWC). It does not consider the other public and private Enterprises.

1.6 Significance of the Study

Governmental and public sector organizations success can be measured mainly through delivery of quality service to their beneficiaries. This can be achieved through well formulated plans and programs, allocation of resources, assignment and retention of committed and competent employees. However, since skilled work force turnover can affect the organization has to achieve the intended objectives and expected results will not be achieved.

Therefore, the study insight the issue in context public enterprise experience. It also might serve as literature for future studies on the topic. In addition it might also use as input for policy makers and implementers though the study is academic and has no guarantee of implementation.

1.7 Limitations of the Study

The study is only limited to the experience of LWC that it did not present the case of other public enterprises. Only existing employees were selected as respondents and key informant interviews and it did not include employee who has left the organization. To fill the gap secondary data which they have filled on clearance were referred.

1.8 Organization of the Research Paper

This paper is organized in to five chapters. The first chapter or introduction part presents the background issue, statement of the problem, objectives, significance and limitations of the study. The second chapter came up with literature review. The literature review covers both empirical and theoretical documents. The third chapter discussed research methods employed and it was embraced research design, sampling techniques, data collection method and tools, data interpretation and presentation. Data interpretation and discussion of data were presented in chapter four. Finally, chapter five revealed conclusion and Recommendations.


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