Effect of Human Resource Practices On Employee Performance in Deposit Taking Savings and Credit Cooperative Organizations in Nairobi County, Kenya

Abstract

Employee performance is crucial for achieving organizational goals and ensuring high-quality service delivery within SACCOs. However, gaps in employee performance can lead to inefficiencies and reduced member satisfaction, underscoring the need for targeted improvements and support to enhance service delivery and operational effectiveness. This study seeks to establish the effect of human resource practices on employee performance in deposit-taking SACCOs in Nairobi County. The study’s specific objectives are: to determine the effect of work-life balance, training, performance appraisal, and compensation on employee performance in deposit-taking SACCOs in Nairobi County. The study was grounded on four theories; organizational justice theory, the human capital theory, the social exchange theory, and the motivation-hygiene theory. The study adopted a descriptive research design. The target population consisted of 87 deposit-taking SACCOs (DT-SACCOs) in Nairobi County, while participants in the study were 87 human resource managers and 293 human resource officers from these SACCOs. A random sampling along the Taro Yamane formula was used to obtain a sample of 169 human resource officers whereas 10 human resource managers were sampled through purposeful sampling. Primary data was obtained using self-administered questionnaires and online questionnaires through Google Sheets. Descriptive and inferential analyses were conducted and results were presented in tables and figures. Results revealed a βeta score of 0.256 and a p-value of 0.001between work-life balance and employee performance, a βeta score of 0.271 and a p-value of 0.000 between training and employee performance, a βeta score of 0.373 and a p-value of 0.000 between performance appraisal and employee performance and lastly, a βeta score of 0.151 and a p-value of 0.002 between compensation and employee performance. The study concluded that work-life balance, training, performance appraisal, and compensation significantly and positively affected employee performance in deposit-taking SACCOs in Nairobi County. The study recommends that deposit-taking SACCOs in Nairobi County adopt comprehensive work-life balance policies, including flexible work arrangements and wellness programs, to enhance employee well-being and performance.