Compensation and employee retention.docx - Compensation and employee retention Employee compensation is one of the major contributors to the retention

Compensation and employee retention.docx - Compensation and...

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Compensation and employee retention Employee compensation is one of the major contributors to the retention of employees (Chang & Lu, 2007). Compensation plays significant role in attracting and retaining good employees specially those employees who give outstanding performance or unique skill which is indispensable to the organization. Compensation systems that organizations offer to the employees play a key role in increasing employee motivation; performance and productivity (Mutsuddi and Mutsuddi, 2007).Hence, most of the organizations are very much concerned about establishing and maintaining the optimal compensation systems. According to expectancy theory (Vroom,1964), when pay is tied to some measure of individual or group performance, employees are more likely to work harder to increase the individual's, the group's or the organization's performance and an increase in performance in any of these areas will lead to an overall improvement in the organization’s performance. Based on expectancy theory (Vroom,
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  • Spring '17
  • Kitakuyi Fred

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