The Impact Of Remuneration On Workers Performance Among Nigerian Workers (a Case Study Of Nigerian National Petroleum Corporation, Eleme Refinery )

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The researcher have summarized the contents of this project work which is aimed at finding out the impact of remuneration on workers performance among Nigeria workers Nigerian National petroleum corporation as a case study.

Chapter one comprises of the introduction of the study, background, statement of problems, objectives, research questions, statement of hypothesis, significance, scope, limitation and definition of terms.

Chapter twp comprises of the literature review and other related topics. Chapter three is the research methodology and how the researcher intended to carry out the study and the questionnaire. Furthermore, chapter four of this study centers on the analysis and discussion of data derived from respondents on the questionnaires which were meant to disclose facts about the subject matter.

Finally, chapter five, which comprises of the summary, conclusion and recommendations to ensure effective workers performance and equitable remuneration in Nigerian national petroleum corporation, Eleme Refinery.     



Title page-               -       -       -       -       -       -       -       i

Approval page -       -       -       -       -       -       -       -       ii

Dedication       -       -       -       -       -       -       -       -       iii

Acknowledgement    -       -       -       -       -       -       -       iv

Abstract   -       -       -       -       -       -       -       -       -       v

Table of contents     -       -       -       -       -       -       -       vi


1.0 Introduction       -       -       -       -       -       -       -       1

1.1 Background of the study            -       -       -       -       4

1.2 Statement of the problem -       -       -       -       -       11

1.3 Objective of the study        -       -       -       -       -       12

1.4 Research questions    -       -       -       -       -       -       13

1.5 Statement of hypothesis    -       -       -       -       -       14

1.6 Significance of the study    -       -       -       -       -       15

1.7 Scope of the study     -       -       -       -       -       -       16

1.8 Limitation of the study       -       -       -       -       -       16

1.9 Definition of terms     -       -       -       -       -       -       17


2.0 Literature review        -       -       -       -       -       -       20

2.1 Introduction       -       -       -       -       -       -       -       20

2.2 Forms of compensations    -       -       -       -       -       21

2.3 Factors that influence remuneration -       -       -       24

2.4 Workers performance that can help to raise workers morale     -       -       -        -       -       -       -       -       -       27

2.5 Legality of workers performance and remuneration 30


3.0 Research design and methodology     -       -       -       38

3.1 Introduction       -       -       -       -       -       -       -       38

3.2 Research design         -       -       -       -       -       -       38

3.3 Sources/ methods of data collection -       -       -       39

3.4 Population and sample size       -       -       -       -       39

3.5 Sample technique      -       -       -       -       -       -       41

3.6 Validity and reliability of measuring instrument        41

3.7 Method of data analysis     -       -       -       -       -       42

        Reference         -       -       -       -       -       -       -       43


4.0 Presentation and analysis of data      -       -       -       44

4.1 Introduction       -       -       -       -       -       -       -       44

4.2 Presentation of data   -       -       -       -       -       -       44

4.3 Analysis of data-       -       -       -       -       -       -       45

4.4 Test of hypothesis      -       -       -       -       -       -       52

4.5 Interpretation of result (s)  -       -       -       -       -       54


5.0 Summary, conclusion and recommendations    -       57

5.1 Introduction       -       -       -       -       -       -       -       57

5.2 Summary of findings         -       -       -       -       -       57

5.3 Conclusion        -       -       -       -       -       -       -       59

5.4 Recommendations     -       -       -       -       -       -       60

      Bibliography      -       -       -       -       -       -       -       62

      Appendix   -       -       -       -       -       -       -       -       64

      Questionnaire    -       -       -       -       -       -       -       65  



The national labour congress made an observation that is still valid. The board observes that “there is no single factor in the whole field of labour relations that does more to break down morale, create individual dissatisfaction, encourage absenteeism, decrease labour turnover, and hamper production than obviously, unjust inequalities in the group within same plant” wage and salary differentials are mark of social status in almost every organization. If they do not correspond to the relative significance of jobs, as employees view them, the employee’s sense of justice is outraged hence “ cognitive dissonance” according psychologists would be the order of the day. Ezeali and Esiagu (2009:112). According to Edward E. Lawler 111,(2008) ,the more important pay or remuneration is, the more power it has to motivate behaviour. Increasing the importance of pay will therefore increase it’s power to motivate. An underpaid staff is les creative and will be of great waste than assets to the employer”. It has been observed that many instance of industrial unrest and strike actions witnessed in Nigeria and many other parts of the world today are due to the perceived inequity in remuneration of workers.

The Nigerian national petroleum corporation, NNPC, was established on April 1, 1977, under the statutory instrument decree No. 33 of same year by a merger of Nigerian national oil corporation, NNOC, with its operational functions and the Federal ministry of mines and power with its regulatory responsibilities.the decree established NNPC, a public organization that would, on behalf of government,adequately manage all government interests in the Nigerian oil industry. The formation was an offshoot of different development in the country’s oil industry. The evolution of the corporation, no doubt was after the first commercial oil find was made in 1956 by shell in Olobiri in present day Bayelsa state.

This was after about half a century of exploration activities in the south western Nigerian where the explorers made numerous bitumen seepage finds.

The success of shell in Niger Delta attracted other companies. Since then, the Nigerian oil industry has gone through rapid expansion not withstanding the disruptive effects of the civil war between 1967 and 1970 and of course, the recent community problems which have grounded several operations. Between 1978 and 1989, NNPC constructed refineries in Warri, Kaduna and Port- Harcourt and took over the 35,000 barrels shell Refinery established in Port- Harcourt in 1965. in addition, the corporation constructed several kilometers of pipeline, pump stations and depots for distribution of petroleum products throughout the country and pioneered exploration activities in the Chad basin around Maiduguri. NNPC employs over 16,000 people nation wide and 700 in port-Harcourt refinery Eleme.


Remuneration is an important instrument that can insert into the workers, the strong effect to bring out their best in order to attain organizational objectives using Nigeria national petroleum corporation as a case study. Remuneration is concerned with the wage and salary administration for various jobs within particular organization in other words remuneration as a form of compensation is the rewards that individuals receive from organizations in exchange for their labour.

(Obikezie and Obi, 2004)To the employer, the most important obligation he owes his employees is their remuneration. Though, there are some non- financial rewards like praise, recognition and self esteem which workers equally value, the most essential compensation is financial compensation which can either be direct or indirect.

Direct compensation is the financial payment made at the time work is performed examples of direct compensation are; wages, salaries, over time pay, commission and bonuses. Wages are usually distinguished from salaries and refer to direct compensation received by a worker paid according to hourly rates. A worker paid on monthly, semi- monthly or weekly basic received a salary. Workers receiving a salary receiver their pay according to the specific number of hour they work. Beside, wages and salaries workers are also remunerated for their efforts by certain benefits, such benefits are paid during vacation days and holdings.

Indirect compensation are; health care, insurance and pensions.

Before remuneration can make an employee to work very well, it must have to be interms of the effort the job needs in other words a motivating remuneration is the one that is equitable to workers contribution towards the achievement of NNPC port- Harcourt objective.

Therefore, a fair remuneration programme is one that is responsive to this managerial and economic objective and ensures acquisition and maintenance of a regular adequate supply of labour for workers not to feel cheated for a remuneration scheme to satisfy or favour these workers, it must embrace the following:

- Periodic review of organization’s wages and salary structure to be in tune with the change nature of the environment.

- Control of differential rate of pay and evaluation of individual and group performance for equitable compensation, through such schemes as incentive payments, merit rating group bonus, overtime payment etc.

The term “workers performance” is very wide it is wide in the sense that it involves diverse aspects of administration and management, such aspect as office environment, office communication, and motivation etc.

Office environment as factor of workers performance affect the performance of workers. Workers today are more educated than before, they are likely to raise questions about their environment of work, since management is in itself a dynamic process; it has to support and address itself to the provision of good environment of work for workers to increased productivity.

Some of the internal conditions suitable for office environment include:-

- CLEANLINESS: If the office environment is clean it will encourage good health of workers and extension of life and conditions of equipment

- AVOIDANCE OF OVER CROWING: This permits free movement of both workers and materials as well as enhances effective operational process.

- TEMPERATURE: Workers and certain machines are successful in cool or air conditioner offices than in hot and noisy areas.

- VENTILATION: Good ventilation is relevant and necessary for effective office work adequate number of windows that can allow enough into the office is preferred.

- SANITARY CONVENIENCE: Workers at work need toilets, wash hand basins, water towel, soap etc. for their convenience.

- LIGHT: The offices should be adequately bright to assist workers especially during clouding periods and peak periods when they have to stay for into the evening.

- OFFICE PREMISES: Consideration should be given to banks, post offices, restaurants, markets, customers etc.

If all the above conditions is well provided for the workers, definitely their performance will be improved by a certain percentage. Besides the condition of offices the organization should also be responsible in provision of the residential apartment of workers because unhealthy or poor residence Scan make workers to be unhealthy. Likewise a worker can only be able to put up his or her best when healthy.

Therefore, management should care for their workers residential environment.

 Communication is also an important tool that is needed by workers for effective and efficient performance of their job in an organization. It is an inevitable tool that links employers and employees in an organization and it is the foundation upon which organization and administration must be build.

Motivation is another tool for workers performance. Motivation affects workers much that is why some workers perform better than other in an organization, as a result of that individuals are motivated by different factors. Based on the above, management should have at their finger tips that they have diverse and unpredictable groups of workers to motivate. This diversity may result in different behavioural patterns which in most cases relate to needs and goals. Some of the factors of motivation are training and development, salaries and wages, benefits, welfare services, understanding between workers and management staff. Workers will prefer to work in an organization where the above motivating factors are well appropriated, because a happy worker is an efficient worker. Therefore, there is no doubt that a motivated workers performance will be improved.

Just as a motivated workers is expected to perform his work properly, if the need or condition of a worker is left unsatisfied, the highly deficient need can lead to frustration,  conflict and stress includes:-

- DEFENSIVE BEHAVIOUR: This type of behaviour can occur when one trips to project one’s image, absenteeism or withdrawal is part of defensive behaviour.

- AGGRESSION: This type of violent action is directed towards an organization by a worker in an improper work performance.

- RATIONALIZATION: This is a situation where by a worker explains failure in a manner that is acceptable to other because his/her need is left unsatisfied.

Just as equitable remunerations make workers to be effective and efficient in the same manner, inequitable remunerations and poor workers performance make workers to be ineffective and inefficient as a result of the uninterested attitudes they might put up.


A statement of the problem is what could be referred to as the crux of the matter. It is obvious that if workers lacks workers performance and better or equitable remuneration it will hinder effectiveness and efficiency in the work environment or organization. Since Nigerian national petroleum corporation is concerned in this research work, some problems are identified by the researcher as the resultant of poor performance. These problems are inequitable remuneration and poor workers performance which leads to social ills, ineffective and inefficient in the organization.

To that effect organization experience failure, inefficient and low output level when employees show case their annoyance by defensive behaviour, aggressive and rationalization.

Therefore, this study attempts to state that the following factors are responsible for poor workers performance in Nigerian national petroleum corporation in port- Harcourt.

-POOR REMUNERATION: The package of the Nigeria national petroleum corporation is very poor, compare to nature and risks they are exposed to in cause of performing their tasks or duties

- Lack of internal condition: This has to do with; temperature, ventilation, sanitary convenience cleanliness and light etc. if these factors are not available it will affect workers performance.

- POOR FRINGE BENEFITS: Certain bonuses and welfare services are not called for.


Objectives is to critically examine the list of available conditions of workers and better or equitable remuneration, their practicability and execution, as well as their importance towards improving the performance of their workers.

Hence,the basic aim of the study includes-:

-To identify the effects of workers performance and remunerations on workers performance in Nigerian National petroleum corporation.

-To examine the mode of remunerations currently applied in NNPC and how effective they are in motivation of workers.

- To determine what an organization should bear in mind when designing remuneration packages for the workers.

- To identify the strategies that is available in the Nigeria national petroleum corporation in other to obtain the greatest capacity of workers.


This is designed to enable to researcher to translate the objectives of the study into some working format. For the researcher to locate better and genuine answers to the research problems, the following research questions have been put forward thus:-

- What are the effect of workers performance and remuneration on workers performance?

- What are the methods of remuneration applied in Nigerian National petroleum corporation?

- Does Nigerian national petroleum corporation carryout performance appraisal?

- What strategies will Nigerian national petroleum corporation apply in order to increase productivity of the workers?

Although these questions might be answered during statement of hypothesis, the exact responses might yet be unrevealed unless the research is carried out.


Hypothesis is an intelligent or educated answer of guess to the problem of the researcher under investigation so as to have a base for Nigerian national petroleum corporation and a guide toward achieving the best result about the research problem, the hypothesis are stated below:-

Ho: A better workers performance does not motivate Nigerian national petroleum corporation workers.

Hi: A better workers performance motivates Nigerian national petroleum corporation workers.

Ho: An equitable remuneration scheme do not lead to high performance.

Hi An equitable remuneration scheme leads to high performance.


The importance remuneration and workers performance will be of interest and convenience to the researcher, relevance to the organization especially NNPC and the society at large. They will benefit from this study in the following ways:-

- It would allow the Nigeria national petroleum corporation to better handle the issue of workers performance and remunerations as motivational tool for their employees.

- It would contribute to the already existing knowledge of man in the field of remuneration and workers performance.

- Yet it will help workers to understand and better their needs, aspiration at work

- Finally, having gone through this work, potential workers/ manager will be allowed the insight to the reality of their working environment, which lies ahead of them when they might have been fully employed.


The scope of this research is limited to Nigerian national petroleum corporation port- Harcourt Eleme refinery within the station, however all categories of staff were studied as questionnaires were distributed ranging from senior staff to junior staff.


The researcher encountered some problems which serve as constraints to this research. These problems encountered are as follows:

Shortage of fund, time, work load of students, the distance between my school and place of the study, non- chalant attitudes of the workers in filling questionnaires and shortage of standard materials (written and audio/ visual) required for proper work. Hence despite all odds, the researcher is still confident of the finding of this research work.


WORKERS: A worker is a person who apply or contribute both physical and mental strength with the purpose of getting things done to achieve a particular objective in other to earn a living.

PETROLEUM: This is an oil found in layers of rock and refined to produce fuels.

CORPORATION: This is a large company or a group of companies as a unit. It can also be defined as an institution operating the service of an economic or social character on behalf of the government. Corporation manage and operate in accordance with the provision of act.

ENVIRONMENT: This is the place where the organization is situated or where the staff reside.

REMUNERATION: This is the wage and salary administration for various jobs with a particular organization.

ORGANIZATION: This is an organized group with a particular purpose.

SALARY: A compensation or remuneration received by a worker or employee on monthly, semi- monthly or weekly basis for performing

WAGE: The direct remuneration received by a worker or employee paid according to hourly rates.

MANAGEMENT: The staff at the top of the organization of firm that control and direct their operations.

MOTIVATION: It is the energizing force that induces or compels and maintains behaviour of workers.


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The Impact Of Remuneration On Workers Performance Among Nigerian Workers