Effects of Fringe Benefits on Employee Performance in

San Pedro Academy, Valencia, Negros Oriental

A Thesis Proposal
Presented to
The Faculty of the Graduate School of
Negros Oriental State University
Dumaguete City

In Partial Fulfillment of
The Requirements for the Degree
MASTER OF BUSINESS ADMINISTRATION

By:

ICA BARORO

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 TABLE OF CONTENTS

INTRODUCTION 3

RATIONALE 3

STATEMENT OF THE PROBLEM 4

OBJECTIVE OF THE STUDY 5

HYPOTHESES 5

SIGNIFICANCE OF THE STUDY 5

SCOPE AND LIMITATION OF THE STUDY 6

DEFINITION OF TERMS 6

THEORITICAL FRAMEWORK 7

CONCEPTUAL FRAMEWORK 8

RESEARCH DESIGN 8

RESEARCH RESPONDENTS 9

RESEARCH INSTRUMENT 9

DATA GATHERING PROCEDURE 9

ANNEX 10

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 INTRODUCTION

Rationale

The success and the survival of any organization or company are determined by the way

the workers are compensated. The reward system and motivating incentives will determine the

level of employees’ commitment and their attitude to work.

Fringe benefits are forms of indirect compensation given to an employee or group of

employees as a part of organizational membership. Bratton and Gold (2009) defined them as that

part of the total reward package provided to employees in addition to base or performance pay.

Fringe benefits focus on maintaining or improving the quality of life for employees and

providing a level of protection and financial security for workers and for their family members.

Like base pay plans, the major objective for most organizational fringe compensation programs

is to attract, retain and motivate qualified, competent employees (Bernadin, 2017) Mathis and

Jackson (2013) continue to state that an employer that provides a more attractive benefits

package often enjoys an advantage over other employers in hiring and retaining qualified

employees when the competing firms offered similar base pay. In fact, such benefits may create

“golden handcuffs,” making employees more reticent to move to other employers.

Fringe benefits are additions to compensation that companies give their employees.

Some fringe benefits are given universally to all employees of a company while others may be

offered only to those at executive levels. Some benefits are awarded to compensate employees

for costs related to their work while others are geared to ge neral job satisfaction. (Julia Kagan,

2020)

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 Numerous surveys and experience of HR professionals have shown that while

employees are concerned about how to earn more pay and enjoy attractive conditions of service,

employers on the other hand would be striving to cut costs so as to post impressive profit at the

end of the accounting period (Milkovitch & Newman, 2014). Meanwhile, studies have shown

that provision of motivators has been resulting in employees’ increased interest in the job,

enthusiasm and increased productivity at work and absence of motivators has been the other

way round (Mathis & John, 2013). Research into employee benefits and organizational

commitment is becoming more important because some researchers have examined the

relationship between them (Christoph, 2016) and also the relationship between employee

benefits, motivation and productivity (Hong, et al, 2015). There is however, still some debate

over fringe benefits on whether they facilitate in employee performance leading to

organizational performance and do benefits effect on an organization's ability to attract.

THE PROBLEM AND IT’S SCOPE

Statement of the Problem

The purpose of this study is to determine the effects of fringe benefits on employee

performance in San Pedro Academy, Valencia, Negros Oriental. Specifically seeks to answer the

following questions.

1. What is the profile of the respondents in terms of gender, age, income, educational

attainment?

2. What is the rating performance of the respondents?

3. What extent of the effects do the following fringe benefits affects the performance of the

respondents?

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 4. Significance difference of their work performance of the respondents.

Objective of the study

The objectives of the study are;

1. To highlight fringe benefit to workers

2. To explain to management advantage inherent in fringe benefit

3. To know if the application of fringe benefit has been put to optimum.

4. To know the extent which fringe benefit has facilitate efficient employee’s services.

Hypotheses

For the successful completion of the study, the following research hypothesis,

1. There is no fringe benefit to workers

2. There is fringe benefit to workers

3. There is no extent which fringe benefit has facilitate efficient employee’s services

4. There is extent which fringe benefit has facilitate efficient employee’s services

Significance of the Study

The findings of this research work are hoped to be of great benefit both theoretically and

practically to management all organizations management and the society at large. Therefore, the

importance of the study lies on the fact that:

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 1. It will create awareness on the part of the management as well as the general public that

fringe benefit factors are a general factor on attitude of employees to work.

2. It will provide useful information and ideas to the leaders on effective way to lead.

3. It is hoped that the result of this research work if implementation will connect some of

the defects inherent in the system so that all will work for the achievement of

organizational goals.

4. It will provide useful ideas and information on the impact of fringe benefit on worker’s

performance.

Scope and limitation of the study

The scope of the study covers impact of fringe benefits on employee performance. The

researcher encounters some constrain which limited the scope of the study;

1. a) AVAILABILITY OF RESEARCH MATERIAL: 

DEFINITION OF TERMS

Performance: This is the result of the employee effort in achieving the organizational objective

in other words; employee’s performance is in the aggregate result of the effort in achieving the

goals of the organization. It can be measured by accessing the overall results of the

organizational goals.

Allowance: Additional payment made to employees being members of an organization.

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Compensation: The totality of the reward system of the employees.

Earning: The sum total of an employee’s income.

Employees: The individual or organization that employ the employees.

Incentives: These are inducement given to members of an organization for the purpose carrying

out organizational objectives.

Performance: This is the result of the employee effort in achieving the organizational objective

in other words; employee’s performance is in the aggregate result of the effort in achieving the

goals of the organization. It can be measured by accessing the overall results of the

organizational goals.

THEORETICAL FRAMEWORK

Expectancy Theory: The Expectancy Theory of Motivation provides an explanation of why

individuals choose one behavioral option over others. The basic idea behind the theory is that

people will be motivated because they believe that their decision will lead to their desired

outcome (Redmond, 2010). Expectancy theory proposes that work motivation is dependent upon

the perceived association between performance and outcomes and individuals modify their

behavior based on their calculation of anticipated outcomes (Torrington, 2009). This has a

practical and positive benefit of improving motivation because it can, and has, helped leaders

create motivational programs in the workplace. This theory is built upon the idea that motivation

comes from a person believing they will get what they want in the form of performance or

rewards. Although the theory is not all inclusive of individual motivation factors, it provides

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leaders with a foundation on which to build a better understanding of ways to motivate

subordinates (AETC, 2008). Expectancy theory is classified as a process theory of motivation

because it emphasizes individual perceptions of the environment and subsequent interactions

arising as a consequence of personal expectations.

CONCEPTUAL FRAMEWORK

Concept of Fringe Benefits

Fringe benefits includes benefits and services, being a part of wage and salary

administration, include all expenditure incurred to benefit employees over and above regular

wages and direct monetary incentives related to output. Erbasi (2012) defined fringe benefits as

compensation in addition to direct wages or salaries, such as company car, house allowance,

medical insurance, paid holidays, pension schemes, subsidized meals. Some fringe benefits are

regarded part of a taxable income.

Concept of Employee Performance

Employee performance is a very critical factor in every organization. It is the basis of the

success of an organization which, in all aspects, is dependent on individual employee

performance. In other words, if an individual performs according to the expected standards, then

organization performance will be enhanced and improved (Chegini, 2010).

RESEARCH METHODOLOGY

Research Design

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 Research design described as the plan or sketch for carrying out research. It deals with

how to handle complete research with emphasis on data collection technique, analysis and

interpretation called for, in scientific research (9). Research design means the plan or blue print

on how to go about data collection and analysis all aimed at providing solution to the problem

under investigation. The study adopted a survey research method in conducting this study.

Survey involves the systematic gathering of information from respondents for the purpose of

predicting some aspects of the behavior of the population. Survey is used because it is

convenient for both small and large population in terms of cost.

Research Respondents/Participants

No. SPA Employees Number of Employees

1. Faculty 16

2. Office Staff 7

3. Maintenance 6

Total 29

Source: San Pedro Academy

Therefore, the population of the study is 29.

Instrument of Data Collection

Data for this study were collected by the use of the interview guide. The researcher

interviewed the respondents.

Validity of the Instrument

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 By validity of the instrument, I mean the extent in which the instrument measures what it

is supposed to measure or accomplishes what it is supposed to accomplish.

ANNEX

INTERVIEW GUIDE

1. Personal Statement

a. Age

b. Gender

c. Educational Attainment

d. Basic Salary

2. Primary Questions

a. What is your position in San Pedro Academy?

b. Are you well compensated in your company?

c. Are you well informed about the benefits that you received from your

organization?

d. Are you satisfied with the benefits that you receive?

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LAY KENG M. DAGOOC
Luzurriaga St., North Poblacion
Valencia, Negros Oriental
Contact No.: 09975996332
Email address: dagooclaykeng@gmail.com

OBJECTIVE
To succeed in an environment of growth and excellence and earn a job which provides
me job satisfaction and self-development and help me achieve personal as well as
organizational goals.
PERSONAL INFORMATION
Nickname : Ken – ken
Gender : Female
Birth Date : May 24, 1992
Birth Place : Valencia, Negros Oriental
Civil Status : Single
Nationality : Filipino
Religion : Roman Catholic
Language Spoken/ Written : Cebuano, Filipino and English

EDUCATIONAL BACKGROUND

Bachelor of Science in Business Administration

Major in Financial Management
Negros Oriental State University 2008 – 2009 - 2013 – 2016
Kagawasan Avenue, Dumaguete City

San Pedro Academy

High School 2004 – 2008
Valencia, Negros Oriental

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SKILLS AND TRAITS

 Computer Literate
 Good Communication Skills
 Ability to manage multiple tasks in a pressured environment
 Hardworking, Flexible, Responsible and Honest
 Able to work efficiently

WORKING EXPERIENCE

Office Aide – LGU Valencia March - present

51 Talk – ESL Teacher 2019 - 2020

Ae Ochoco & Partners Cpa’s Co.

Working Student June – November 2015

SPI CRM (Teleflora - Seasonal Account)

Customer Service Representative 2012 – 2014

Dunkin Donuts
Cashier 2011 - 2012

San Pedro Academy Kindergarten Department

Assistant Teacher 2010 – 2011

PRACTICUM/WORK INTEGRATED LEARNING

PRACT 1 Municipality of Valencia 200 Hrs (completed)

PRACT 2 NORECO II 200 Hrs (completed)

REFERENCES

Jeana A. Alabastro
North Poblacion,
Valencia, Negros Oriental
0997-271-4202

Jundie GV Liao
Trainer
Sibulan, Negros Oriental

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0935-279-9485

Raymund B. Austero
Meat Shop Owner
Valencia, Negros Oriental
0927-499-3389

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