CHAPTER ONE

1.0 INTRODUCTION

          Remuneration is the compensation that one receives in exchange for the work or services performed. Typically, this consists of monetary rewards, also referred to as wage or salary. A promotion is the advancement of an employee's rank or position in an organizational hierarchy system. Promotion may be an employee's reward for good performance, i.e., positive appraisal. Before a company promotes an employee to a particular position it ensures that the person is able to handle the added responsibilities by screening the employee with interviews and tests and giving them training or on-the-job experience. A promotion can involve advancement in terms of designation, salary and benefits, and in some organizations the type of job activities may change a great deal.

Good remuneration has been found over the years to be one of the policies the organization can adopt to increase their workers performance and thereby increase the organization productivity. Also with the present global economic trend, most employers of labour have realized the fact that for their organizations to compete favourably, the performance of their employees goes a long way in determining the success of the organization. On the other hand the performance of employees in an organization is vital not only for the growth of an organization but also for the growth of individual employees. An organization must now who are its outstanding workers, those who need additional training and those not contributing to the efficiency and welfare of the company.

          Throughout the years production has increased for many reasons in addition to the particular motivation and has erroneously over simplified a highly complex phenomenon since the psychologists have been especially concerned with understanding an individual through his motives and acquired a body of knowledge in this field that often differs from the Layman‟s knowledge is necessary to review briefly from the psychologists point of view what is known about motivation at the present time. In Uganda, effective use of rewards and motivation to influence workers‟ performance begun in 1970s, since then performance of workers has become important due to the increasing concern of human recourses and personal expects about the level of output obtained from the workers due to poor remuneration. This attitude is also a social concern and is very important to identify problems that are met in industrial settings due to non-challant attitude of managers to manage their workers by rewarding them well to maximize their productivity. All efforts must be geared towards developing workers interest in their job so as to make them happy in giving their best to their work and this will ensure industrial harmony. Vroom (1964) supported the assumption that workers tend to perform more effectively if their wages are related to performance which is not based on personal bias or prejudice but on objective evaluation of an employee on merit. Though several techniques of measuring job performance have been developed in general, the specific technique chosen varies on the type of work. All these issues call research efforts so as to bring focus on how an appropriate reward package can gear up or influence the workers to develop a positive attitude towards their job and thereby increase their productivity.

1.1     BACKGROUND OF THE RESEARCH

          Remuneration is directly linked with the time spent or devoted by an employee on the job. The employees are paid a fixed pre-decided amount hourly, daily, weekly or monthly irrespective of their output. It is a very simple method of remuneration. It leads to minimum wastage of resources and lesser chances of accidents. Time Rate method leads to quality output and this method is very beneficial to new employees as they can learn their work without any reduction in their salaries. This method encourages employees unity as employees of a particular group/cadre get equal salaries.

There are some drawbacks of Time Rate Method, such as, it leads to tight supervision, indefinite employee cost, lesser efficiency of employees as there is no distinction made between efficient and inefficient employees, and lesser morale of employees.

According to Armstrong (2003), good practice requires employers to keep pace with inflation by rewarding employees with salaries that are market related to avoid strikes and poor performance by workers. Organizations are under financial strain with salaries continually rising and becoming a major fixed expense. According to Livingstone (2009), regardless of basic pay inefficiencies, it remains a rule that employees should be paid at, or above market rates as negotiated by labour unions who are concerned with the welfare of employees. In a competitive market, higher basic pay is used for attracting and retaining employees. Otherwise contradicting this rule has negative consequences on the part of the organization. Basic pay communicates commitment to employees, and is used as the baseline for assessin

1.3     OBJECTIVES OF THE STUDY

          The objectives of this study were based on the architectural model on staff promotion and remuneration effect and they included the following:

1.    To determine current incentive package the model at which staff promotion and remuneration are rewarded.

2.    To determine the effectiveness of the model architecture on staff promotion and remuneration.

3.    To discover the factors effecting staff promotion and remuneration management

1.4     SIGNIFICANCE OF THE STUDY

          The study will, however, try to talk on why it is essential to set a model an architectural scheme for staff promotion and remuneration. This research work will also, serve as a learning tools an academic material to the students and among business ventures.

1.5     SCOPE OF THE STUDY

          The project work sited here encompasses the model architecture for staff promotion and remuneration. It covers the attempts made in the past on this topic, the successful attempts as well as the failures. Therefore this project research work only covers the project topic specified only.

1.6     RESEARCH QUESTION

          The research questions will be tailored towards the purpose of the study such that if they are answered, one will clearly realize why model architecture is necessary in the management of staff promotion and remuneration. The questions are the following:

1.       What are the current incentive package the model at which staff promotion and remuneration are rewarded?

2.       How effective is the model architecture on staff promotion and remuneration?

3.       What are the factors effecting staff promotion and remuneration management?