Tough economic times in Kenya dampen employers end-year gifts to workers

Over two thirds of employers in the country will give end-year rewards to their employees, a new survey has shown.

According to a survey by Corporate Staffing Services (CSS), a Nairobi-based recruitment and HR consulting firm, there is a widening expectation gap between the rewards employers are currently giving and the wishes of the majority of employees.

According to the 'End of the Year Rewards Survey', while majority of employers favour non-monetary gifts, employees would rather have the cash.

It reveals that 44 per cent of employers will this year give non-monetary gifts, while 33 per cent plan to give money. On the other hand, 55 per cent of the 2,702 employees polled in the survey would wish to receive a pay rise, while 28 per cent prefer cash bonuses. Only 10 per cent support gifts.

The survey indicates that majority of the employers will give non-monetary gifts to reward their employees, as local companies tighten their expenditure due to budgetary constraints blamed on a slow-down in business.

“This may be attributed to the flexibility and variety of non-cash incentives and recognition programmes in responding to diverse employee needs,” said Perminus Wainaina, the CEO of Corporate Staffing Services, while releasing the survey results at a Nairobi Hotel.

The number of employers who will give gifts to their workers has dropped this year compared to last year. Close to 40 per cent of  employers will not be awarding their employees anything this year, blaming the prevailing harsh economic conditions for not rewarding their workers. About 20 per cent of this category said they have adopted year-round recognition and awards programmes rather than a one-off reward at the end of the year. Of the organisations that rewarded employees in 2014, 15 per cent will not do so this year.

As expected majority of the employees (55 per cent) polled in the survey would rather receive a pay increment. On the other hand, 28 per cent prefer cash bonuses, while 10 per cent want gifts.

The non-monetary rewards employees expect to be given include shopping vouchers, free lunches and outings, extended leave days and recognition through various awards or even gifts.

According to Mr Wainana, the employers involved in the survey, who are from both public and private sectors, including start-ups, said their monetary rewards included bonuses and pay increments.

“Bonuses, profit-sharing plans and paid time off are some of the other monetary incentives issued to employees,” said the CEO, who added that the cash incentives encourage friendly competition between associates when linked to job performance and are a great motivator to employees. When rewards for performance are not based on money, the culture of organisations tends to value recognition instead of the drive for money. Such companies spend less on motivating employees and channel more money into improving other areas of the business.