CHAPTER ONE
INTRODUCTION

Maintaining healthy employee relations in an
organization is a pre-requisite for organizational success. One way of
maintaining good and healthy employee relations in an organization is by
attaching lucrative benefits to every job and task carried out by every
employee in that organization. Employee benefits which are the various non-wage
compensations provided to employees in addition to their normal wages or
salaries cannot be over looked by the management of an organization, since the
human resource of an organization is the most valued resource. This current era
is highly competitive and organizations regardless of size, technology and
market focus are facing employee retention challenges. To overcome these
restraints a strong and positive relationship and bonding should be created and
maintained between employees and their organizations. To enhance this strong
and positive relationship, employees should be motivated to put in their best
by providing employees with certain lucrative employee benefits like
performance bonuses, Christmas bonuses, study allowances, leave allowances etc.
Human resource or employees of any organization are the most central part so
they need to be influenced and persuaded towards tasks fulfilment.
In-order to achieve organizational goals, organizations must design various
strategies to make employees happy, and place various incentives for them to
benefit from, thereby adding value to themselves and increasing organizational
performance. If employees are not satisfied with their job or work place, they
tend to put little efforts at work or move to other organizations with better
job packages. This can cost an organization so much, especially if they are
loosing a key and very competent staff to a competitor.

1.1 BACKGROUND OF THE STUDY AND ORGANIZATIONAL
PROFILE
Employee benefits had its roots in the industrial revolution which created the
modern employment relationship by spawning free labour markets and large-scale
industrial organizations with thousands of wage workers. As society wrestled
with these massive economic and social changes, labour problems arose. Low
wages, long working hours, monotonous and dangerous work, and abusive
supervisory practices led to high employee turnover, violent strikes, and the
threat of social instability.  These led to various labour unions calling
for organizations to compensate employees accordingly. Intellectually,
industrial relations were formed at the end of the 19th century as a middle
ground between classical economics and Marxism, with Sidney Webb and Beatrice
Webb’s Industrial Democracy being the key intellectual work. Industrial
relations thus rejected the classical econ. Institutionally, employee relation
was founded by John R. Commons when he created the first academic industrial
relations program at the University of Wisconsin in 1920. Early financial
support for the field came from John D. Rockefeller, Jr. who supported
progressive labour-management relations in the aftermath of the bloody strike
at a Rockefeller-owned coal mine in Colorado. In Britain, another progressive
industrialist, Montague Burton, endowed chairs in industrial relations and
employee benefits at Leeds, Cardiff and Cambridge in 1930, and the discipline
was formalized in the 1950s with the formation of the Oxford School by Allan
Flanders and Hugh Clegg. Employee benefits and organizational relations were
formed with a strong problem-solving orientation that rejected both the
classical economists’ laissez faire solutions to labour problems and the
Marxist solution of class revolution. It is this approach that underlies the
New Deal legislation in the United States, such as the National Labour
Relations Act and the Fair Labour Standards Act.

1.2 PROBLEM STATEMENT
Designing and implementing a good employee benefit plan is a huge challenge for
most organizations in Nigeria. A study conducted by Cascio (2003) in some West
African countries including Nigeria revealed that most organizations in
developing countries do not structure and implement their employee benefit
packages in an appropriate manner; hence employees find it difficult to really
believe they are benefiting from their workplace.
Poorly designed benefit plans that do not actually motivate employees to put in
their best at work is a major issue in corporate Nigeria today. Organizations
that do not design their employee benefit plans based on the personality and
nature of their employees tend to be wasting resources and efforts, as
employees are not motivated to work hard if certain benefit packages offered by
the organization do not speak to their needs. An average Nigeriaian worker
places more importance to the benefits he or she will derive from working,
therefore they are very concerned about what they are paid. Cascio (2003) opines
that because of the importance that employee benefits hold for people’s
lifestyle and self esteem, employees are very concerned about what they are
paid as benefits- a fair and competitive employee benefit, while wise
organizations are concerned about what they pay because it motivates important
employee decisions especially when it comes to job delivery and performance.
Implementation of employee benefit is also a major challenge in corporate
Nigeria, as employee benefits are sometimes delayed or ruled out due to cost
reduction measures by the management of an organization. This has brought about
massive corruption, high employee turnover and low employee moral/productivity.