EFFECTS OF MENTAL HEALTH ON THE PRODUCTIVITY OF EMPLOYEES

WITHIN FINANCIAL INSTITUTIONS: A CASE OF COMMERCIAL BANKS IN

KENYA

BY
PAULINE AWUOR OCHIENG’

UNITED STATES INTERNATIONAL UNIVERSITY- AFRICA

SUMMER 2020
EFFECTS OF MENTAL HEALTH ON THE PRODUCTIVITY OF EMPLOYEES
WITHIN FINANCIAL INSTITUTIONS: A CASE OF COMMERCIAL BANKS IN
KENYA

BY
PAULINE AWUOR OCHIENG’

A Research Project Report Submitted to the Chandaria School of Business in Partial

Fulfilment of the Requirement for the Degree of Masters in Business Administration
(MBA)

UNITED STATES INTERNATIONAL UNIVERSITY- AFRICA

SUMMER 2020
 STUDENT’S DECLARATION

I, the undersigned, declare that this is my original work and has not been submitted to any
other colleges, institution, or university other than the United States International University
in Nairobi for academic credit.

Signed: Date:

Ochieng’ Pauline Awuor (ID NO: 632798)

This project has been submitted for examination with my approval as the university appointed
supervisor.

Signed: Date:

Prof, Caren Ouma, PhD

Signed: Date:

Dean, Chandaria School of Business

ii
 ABSTRACT

The purpose of this study was to examine the effects of mental health on the productivity of
employees within financial institutions: A case of Commercial Banks in Kenya. The study
was guided by the following research questions: (1) How does work-related stress affect the
physical and mental health of employees in commercial banks? (2) What are the effects of
absenteeism on the performance of employees in commercial banks? (3) What are the effects
of depression and stigmatization on the performance of employees in commercial banks?

A descriptive research design was adopted in conducting this study and addressed the
research questions posed above. The study population consisted of a total of 800 employees
in top, medium and operational level from Cooperative Banks, Bank of Africa and National
Bank of Kenya, however, out of a total sample of 384 only 300 employees responded
resulting in a 78% response rate. The study utilized SPSS for data analysis and descriptive
research design was analyzed in the form of frequencies and percentages. At the same time
inferential statistics was also done to determine the relationship between dependent and
independent through correlation and regression analysis. The dependent variable included the
rewards, the performance of the employees whereas the independent variable was the
implications on employee mental health. The findings were presented using Tables and
Figures.

A Pearson correlation test was done to investigate the correlation between Stress and Health
in terms of mental and physical health. The study showed there was no significant correlation
between stress and health at (p=0.658, r=-0.060) for mental health and at (p=0.108, r=0.211)
for physical health. A Pearson correlation test was done to investigate the correlation
between absenteeism and employee performance. The study showed there was a strong
negative significant correlation between absenteeism and employee performance at (p=0.000,
r=- 0.557). A Pearson correlation test was done to investigate the correlation between
Performance and Stigmatization in terms of performance. The study showed there was a
negative correlation between Performance and Stigmatization at (p=0.341, r=-0.126). A
regression analysis was done to investigate the extent to which absenteeism affected
employee performance. The model summary table showed that R= -0.557 meaning the
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correlation between the two

iv
variables was negative and strong while R Square= 0.310 indicating that Absenteeism
affected 31% of the employee performance.

The study concluded that employees were given unrealistic targets with their employers and
were expected to meet their targets, the human resource manager needed to ensure there was
work-life balance. The employees agreed that burnout was the major variable that affected
their performance. They agreed that their opinions should be taken into account and given
equal opportunity within the organization. To achieve high productivity for the employees, it
was essential to note that work-life balance played a major role in the morale and motivation
of the employees. The employers needed to use leadership style that motivated the employees
to work even harder. The leaders also needed to provide a conducive environment for work
to be performed. There was need for remuneration within the institution to be the same across
board as this would be a motivating factor for the other employees. To have a high return, the
employer needed to treat their employees as the most important asset within the institution.
Inflexible working hours and conflict with the supervisor, increased the level of employee
turnover within the institution.

On the effects of job stress on the mental health of employees in commercial banks, the study
recommends that institutions should give employees realistic targets and support employees’
opinions. This would help the burnout situation experienced in the work place. It also helped
to measure the employee productivity.

The study recommends that employers should provide a conducive environment in order to
increase their productivity. This helped to mitigate the effects on absenteeism on employee
performance. The employees also needed to be remunerated fairly and provided with training
to do their jobs better.

The study recommends that the employers needed to deliberately address mental health
issues. This helped to curb the effects of depression and stigmatization among the employees.
Discussion on mental health among employees should also be allowed without
discrimination.

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 ACKNOWLEDGMENT

I would like to thank the Almighty God for enabling me to conduct this research and gain
academic insight on the topic. I would also like to express my gratitude to my project
supervisor Prof. Caren Ouma, for the opportunity to complete this project. I am specifically
grateful to her for her counsel and guidance on the best way to write this project, hence
molding me into a better researcher and enabling me to gain knowledge on the best way to
motivate employees to catapult them towards greater efficiency within organizations they
work for and ultimately ensure greater gains and profits.

I would also want to thank my family, friends, and colleagues for helping and supporting me
morally, and through the dedication of invaluable resources to assist me in completing the
project. I am particularly grateful to them and my household for providing a conducive
environment and understanding, especially at times when I had to stay up late while writing
the project.

Lastly, I would like to thank everyone who played a part in helping me complete this project.

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 TABLE OF CONTENTS
STUDENT’S DECLARATION..............................................................................................ii
ABSTRACT.............................................................................................................................iii
ACKNOWLEDGMENT..........................................................................................................v
TABLE OF CONTENTS........................................................................................................vi
LIST OF TABLES................................................................................................................viii
LIST OF FIGURES................................................................................................................ix

CHAPTER ONE......................................................................................................................1
1.0 INTRODUCTION..............................................................................................................1
1.1 Background of Study............................................................................................................1
1.2 Statement of the Problem.....................................................................................................7
1.3 Purpose of the Study............................................................................................................8
1.4 Research Questions..............................................................................................................8
1.5 Significance of the Study.....................................................................................................9
1.7 Definition of Terms............................................................................................................10
1.8 Chapter Summary...............................................................................................................11

CHAPTER TWO...................................................................................................................13
2.0 LITERATURE REVIEW................................................................................................13
2.1 Introduction........................................................................................................................13
2.2 Effects of Work-Related Stress on Mental and Physical Health of Employees.................13
2.3 Effects of Absenteeism on the Performance of Employees...............................................20
2.4 Effect of Depression and Stigmatization on the Performance of the Employees...............26
2.5 Chapter Summary...............................................................................................................33

CHAPTER THREE...............................................................................................................35
3.0 RESEARCH METHODOLOGY....................................................................................35
3.1 Introduction........................................................................................................................35
3.2 Research Design.................................................................................................................35
3.3 Population and Sampling....................................................................................................35

vii
3.4 Data Collection Methods....................................................................................................38
3.5 Research Procedures...........................................................................................................39
3.6 Data Analysis Methods......................................................................................................39
3.7 Chapter Summary...............................................................................................................40

CHAPTER FOUR..................................................................................................................41
4.0 RESULTS AND FINDINGS...........................................................................................41
4.1 Introduction........................................................................................................................41
4.2 General Information...........................................................................................................41
4.3 Effects of Job Stress on Mental and Physical Health of Employees in Commercial.........44
4.4 Effects of Absenteeism on the Performance of Employees in Commercial Banks...........49
4.5. Effects of Depression Stigmatization on the Performance of the Employees in..............54
4.6 Chapter Summary...............................................................................................................58

CHAPTER FIVE....................................................................................................................59
5.0 DISCUSSION, CONCLUSION, AND RECOMMENDATIONS................................59
5.1 Introduction........................................................................................................................59
5.2 Summary............................................................................................................................59
5.3 Discussion..........................................................................................................................60
5.4 Conclusions........................................................................................................................65
5.5 Recommendations..............................................................................................................66
REFERENCES.......................................................................................................................68

APPENDICES........................................................................................................................76
APPENDIX I: CONSENT TO PARTICIPATE..................................................................76
APPENDIX II: DEBRIEF FORM........................................................................................78
APPENDIX III: INTRODUCTION LETTER....................................................................79
APPENDIX IV: QUESTIONNAIRE....................................................................................80
APPENDIX V: INSTITUTIONAL REVIEW BOARD (IRB) LETTER..........................86
APPENDIX VI: NACOSTI PERMIT..................................................................................87

viii
 LIST OF TABLES
Table 3.1: Population Distribution...........................................................................................36
Table 3.2 Sample Size Distribution..........................................................................................38
Table 4.1 Response Rate..........................................................................................................41
Table 4.2: Mental Health.........................................................................................................46
Table 4.3: Stress.......................................................................................................................47
Table 4.4: Physical Health.......................................................................................................48
Table 4.5: Correlation between Health and Stress...................................................................49
Table 4.6: Absenteeism............................................................................................................50
Table 4.7: Leadership Styles....................................................................................................51
Table 4.8: Job Satisfaction.......................................................................................................52
Table 4.9: Correlation between Employees Performance and Absenteeism...........................53
Table 4.10: Model Summary....................................................................................................53
Table 4.11: ANOVA................................................................................................................54
Table 4.12: Coefficients...........................................................................................................54
Table 4.13: Motivation.............................................................................................................55
Table 4.14: Employee Turnover..............................................................................................56
Table 4.15: Training and Development...................................................................................57
Table 4.16: Correlation between Depression Stigmatization and Performance of the
Employees in Commercial Banks............................................................................................58

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 LIST OF FIGURES
Figure 4.1: Gender of Respondents..........................................................................................42
Figure 4.2: Age of Respondents...............................................................................................42
Figure 4.3: Level of Education.................................................................................................43
Figure 4.4: Number of Years Worked in this Financial Institution.........................................43
Figure 4.5: Institution.............................................................................................................444

x
 CHAPTER ONE
1.0 INTRODUCTION
1.1 Background of Study
Productivity is the ratio of what is produced to what is required to produce it. This is
expressed in the form of an average that expressed the total output of some category of goods
divided by the total input of the labor or raw material. M. S. Sharma and M. V. Sharma
(2014) observed that employee productivity improvement was the most important objective
of an organization since high levels of employee productivity provided the organization with
various advantages. The results included favorable economic growth, more profits and better
social progress. Additionally, an employee who performed well within the organization
obtained better salaries, better working conditions and employment opportunities were
favorable for them.

Employee performance in the organization depended on various factors but the most
important one was training since it enhanced the capabilities of the employees within the
organization (Raja, Furqan & Khan, 2011). Employees who had more experience in their job
tend to perform better since they had skills and competencies acquired from the job
experiences. Training played a major role on the return on investment since the
organization’s performance depended on the employee’s performance. The human resource
capital of the organization also played a major role in the growth and the development of the
organization as well as increased the effectiveness of employees (Devi & Shaik, 2012).

The most valuable asset within the organization are the employees. In the global arena, banks
were under the pressure to perform in the volatile market. The steep competition among bank
and other entities like Safaricom who came up with ways to lend money in the economy,
globalization, the growing customer demand, and the high risk forced the baking sector to
develop new ways to provide better services to their clients for them to be in a better position
to compete and to improve their profitability to guarantee survival. The banking sector
globally faced challenges that were unpredictable due to the wave of privatization and
globalization. The organization had to adopt a broad strategy that ensured it experienced
sustainable competitive advantage over its competitors (Aldaibat & Irtaimeh, 2012).

1
A survey done in Nigeria stated that even though training was important to ensure that
employee performance was increased within the organization, most organizations did not

2
support the training programs offered. The organizations considered the money allocated for
training programs and the development of the employees was a waste of time. They failed to
see that training provided effectiveness and efficiency among the employees (Obi-Anike &
Ekwe, 2014). Employee performance served as evidence that employee behavior contributed
to the organization objectives being achieved. Scholars stated that employee performance
depended on factors like employee motivation, appraisal compensation, job security and the
structures within the organization (Saeed & Asghar, 2012).

Findings from different countries such as India, Nigeria, and Brazil stated that the employees
working in the banking sector had pressure to meet their targets (Obi-Anike & Ekwe, 2014).
This was noted mostly on the employees who had worked in the banks for more than 5 years
and were married. This led to deterioration of their performance in the bank. This study in the
Kenya Banking sector attempted to fill the gap to see how employee productivity affected the
economy.

In Kenya, banks existed since colonial times (CBK, 2016). During the colonial times, the
banks were located in the urban centers and they charged large amount of money for an
individual to open an account. This meant that the low income earning individuals could not
afford to open bank accounts (Nyamongo & Temesgen, 2013). The banks were only
preserved for the rich in the economy and because of this, the banks' performance during that
time was very low. However, the banking situation changed. Currently, we have 46 banks in
Kenya categorized as private and foreign-owned and all individuals no matter the income, are
allowed to open bank account. The banking sector in Kenya is governed by the Companies
Act, The Banking Act and the Central Bank of Kenya. Organization performance played a
key role to ensure that the Banks in Kenya are growing by determining the actual output of
the organization measured against its intended output (CBK, 2016).

According to Wachira (2013), employee training and development led to growth in business
in Absa Bank Kenya formally known as Barclays Bank. She continued to state that training
and development were used at the bank to ensure that the staff members at the bank were
well- grounded to support the growth and this meant that the employees also had the
opportunity to take up higher responsibilities and achieve more both in their professional and
their personal lives. A study that was done by Otuko, Chege and Douglas (2013) on the

3
effects of training

4
dimensions on the employee’s performance at work with a focus on Mumias Sugar Company
also supported Wachira. They stated that there was a positive and significant effect on
training needs assessments, its content and the employee’s performance in Mumias Sugar
Company Limited.

Mental health can be defined as the cognitive, behavioral, and emotional well-being. It’s
about how individuals think, feel, and behave. Mental health also ensured that individuals
had great relationships, emotional stability and that they contributed to the society. Many
people suffered from mental illness yet they lacked the courage to openly speak about it.
Mental illness affects anyone regardless of age, gender, income, social status, race, religion
sexual orientation or even the culture of the individual (Newman, 2020).

Research done by the National Institutes of Mental Health in the United States showed that
close to 44 million adults which was 18% of the population in the country experienced
mental disorder yearly. This meant that raising awareness and ensuring that people
understood the effects of mental illness as this could change how the society viewed mental
health. American Psychiatric Association stated that 26.2% of the Americans under the age
of 18 and above, 1 in 5 adults suffered from mental disorder in a given year and that the
disorder was caused by employment, school attendance and their daily routine lives. In the
United States of America, the effects of mental disorder in society affected the economy of
the country directly and indirectly. Directly in that the individual ended up losing their source
of livelihood and indirectly in the form of loss of productivity at work which caused the
society over $400 billion annually. This was essentially equated to giving $1,250 to every
individual in the country. It also affected human life since on a daily basis almost 91 people
die from a drug overdose and an average of 3,800 teenagers attempted suicide. It was also
important to note that in the United States of America, they had experienced a 25% increase
in suicide within the last 15 years (National Institute of Mental Health [NIMH], 2017).

The increased mental health awareness had led to increased stigmatization of people with
mental health upon observing past analysis about mental health conditions in various
organizations. Depression and anxiety were found to be the most common complications that
affected the performance of the employees. According to statistics from the mental health

5
foundation in the United Kingdom, 1 out of 4 employees’ experienced mental health
problems while 9 out of 10 experience stigmatization and discrimination on their mental
condition (Mental Health Foundation [MHF], 2016).

Mental health conditions largely affected businesses in the United Kingdom. A survey by the
Labor Force Survey showed that 440,000 reports received were related to either stress,
depression, or anxiety in the workplace, which translated to 9.9 million lost working days in
2014 and 2015 (Health Safety and Environment [HSE], 2015). It was difficult to decipher
when mental disorder commenced or how long it took for an employee to get cured as the
symptoms of mental health complications were often similar to physical and psychological
symptoms and there were no blood test that could determine mental illness (Weir, 2012,
p.30).

According to results from past research, organizations that didn’t prioritize their employees’
well-being incurred significant costs of around £42 billion annually, which in turn costs the
United Kingdom economy £99 billion in output loss. The analysis also showed that
employees were laid-off after their employers discovered their mental health complications.
Employers needed to give mental health the same attention and consideration given to
physical health. Stress impaired people’s personal and professional well-being, and therefore,
there was need to find a solution that helped alleviate the problem amongst employees. At the
workplace, depression, mood, and anxiety were the most common mental complications
facing employees. This placed employers at a disadvantage since it lowered the affected
employees’ efficiency and ultimately adversely affected the organization’s profitability,
which caused financial problems for the organization (HSE, 2015).

In Africa, statistics showed that 46% of both the citizens and their governments were
ignorant of mental health services as well as the required remedial policies and guidelines for
curbing mental health complications amongst their population. Besides, an average of 9 out
of 100,000 people suffered from mental health globally. In Africa, this figures rose to 14 out
of every 100,000 workers. Besides, there were fewer psychiatrists in active practice in Africa
as many Africans considered it a taboo to publicly discuss mental health matters. As a result,
people who suffered from mental health problems in Africa are discriminated against. For
6
example,

7
there was treatment gap of 98.8% concerning people with mental health problems in Sierra
Leone (Alemu et al, 2012).

Mental health complications are a growing concern in Africa. Despite Africa’s relative
population growth of 49% in 2015, 52% of the population suffered from mental health
complications and never received any treatment. Failure to handle this risk menace in good
time would double the number of people suffering from mental health complications within
the next decade (WHO, 2014).

The number of millennials around the world who were depressed due to the actual or
apparent failure in achieving their unrealistic goals increased. Policymakers’ sought to
eradicate the negative perceptions of mental health disorders. This would reduce the
prevalence of mental health disorders among the public. The policymakers should utilize the
scarce resource available for the benefit of the affected population. Policymakers should
ensure that people change their attitude towards mental health; from the traditional beliefs
that mental health disorders are caused by supernatural forces to contemporary considerations
that they are broad- based cases of treatable/manageable health conditions. The enacted
policies was tailored towards the eradication of stigmatization of people suffering from
mental health complications within communities (WHO, 2014).

In Kenya, there was need to prioritize mental health and the stigma related to mental health
disorders. In the banking industry, people spent their time working despite inadequate
remuneration. Once they failed to achieve their desires and lost the ability to care for their
families, they got depressed. In the banking industry in Kenya, most employees felt stagnated
in one position for a long time. These employees continued working with the organizations
since they were being offered loans at lower rates, but if they wished to leave the
organization, they were required to pay the loan at market interest rates. Considering the
high-interest rates payable by non-employees, they were forced to continue working for the
bank regardless of harsh working conditions. Research from psychiatrists Lukoye and Watere
showed that men were more prone to mental illness as opposed to women. They stated that 1
in 4 Kenyans who were male suffered from mental illness, but were afraid to speak up. This
was the cause of the
8
higher suicide rates amongst men in Kenya than women. Psychiatrists Lukoye Atwoli and
Job Watere stated that the rates were lower for women because they sought for help through
existing mental health resources and released stress by talking to their family members and
friends. Men, however, coped by abusing drugs or suffered in silence (Ayodele, 2014).

World Health Organization helped by providing ways for employees in Kenya to deal with
mental health issues without discriminations. Nevertheless, there was still more room for
training and education. Kenya launched her first mental health policy in 2016, which was
aimed at ensuring access to quality health care. This involved training community workers
and hospital staff on issues of mental health. Kenya, which is a member of the World Health
Organization has 62 registered psychiatrists and 16 hospitals that offer mental care facilities.
However, Kenya had not yet allocated funds for addressing mental health issues. The lack of
allocated funds limited the availability of resources that addressed mental health issues, and
as a result, made mental health services very expensive and unattainable for many Kenyans.
The mental health Act of 2014 stated that the rights of people with mental health should be
protected which ensured that the people with mental health disorder are at the center of
decision making about their treatment and care. Insurance companies that discriminated
against people with mental health were at a disadvantage (WHO, 2014).

The mental health and safety of employees played an important aspect of human resource
management and it helped manage the relationship between the employer and employees as
the employer gained a lot when the well-being of his employees was prioritized. A healthy
employee devoid of mental health problems was more productive and generated more profits
as opposed to one with mental health problems. Employees’ well-being not only ensured that
they were productive because they felt valued but also gave employers a competitive
advantage, which in turn improved the company’s reputation. The main objective of the
study was to ensure that organizations have a well-engaged and productive team. The
promotion of mental health was related to the intrinsic value that employees crave in their
daily lives (WHO, 2014).

9
1.2 Statement of the Problem
In a world where businesses are fast-growing with people investing in businesses and many
competitors in the market, employers needed to ensure that their employees were better
positioned to maximize their shareholders’ wealth. Employers, therefore, needed to take good
care of their employees by providing them with medical health insurance, leave days,
mentorship programs, and good working environment. In financial institutions, there were
lots of pressure because of the many competitors in the market. The government introduced
interest rate capping in the banking sector. This reduced the frequency of lending as banks
were no longer lending as much as they used to because of little returns from loans despite
the high- risk venture. This meant that banks had to devise better ways to generate more
profits in the business (Central Bank of Kenya, 2016).

The situation was further complicated by emerging lenders like Safaricom PLC and
Commercial Bank of Africa who launched a groundbreaking mobile banking service M-
shwari. This complication further reduced the number of customers accessing credit from the
banks, therefore forcing commercial banks to pursue other market ventures and clients.
Accordingly, getting new clients proved difficult for most banks (“Safaricom, CBA Launch,”
2012). This caused many salespeople to be depressed and led to many fraudulent cases by
bank employees in their attempt to attain targets set by their managers. Most bankers had
reported suffering from anxiety, depression, and abuse of prohibited substances, with 50%
not seeking mental health care services.

Depression caused suicidal tendencies, absenteeism from work, underperformance and

discharge of stress on workmates, increased hiring cost due to high turnover and overworking
of the employees. As a result, it led to decreased productivity of the employees in the
company, which presented major problems to the shareholders. It also reduced the morale,
creativity, and innovation of the employees as they felt neglected. Some employees ended up
being diagnosed with diabetes and asthma (Imison, Castle-Clarke & Watson, 2016).

Workplace culture needed to be in line with the health and well-being of the employees. This
forced the employer to provide a good working environment for its employees. Employees’

10
job description needed to match their capabilities, and training needed to be done where there
was a mismatch. This ensured that the employees were motivated and their mood was
improved, hence increased productivity and efficiency within the organization. Employers
also needed to invest in educating the managers on how to support employees with mental
health disorders. They would ensure they provided a conducive environment where
employees felt they could share their problems without discrimination from their colleagues
(Imison et al., 2016).

Therefore, while there were existing studies on mental health and its effects on the
community, previous studies did not address the effect mental health on the productivity in
an organization especially in the financial institutions. Given the research problems, this
study sought to address the knowledge gap on how to identify and treat the employees who
suffered from mental health to increase productivity in the workplace as well as maintain
mentally stable staff members. There was need to reshape the workforce and ensure that
employees were well taken care of. This would only happen if managers were well-trained
and the members of the public were educated on how to identify, monitor, and deal with
people suffering from mental health. If an employer invested in taking care of their greatest
asset, their employees, they were likely to increase their productivity within the company
(Imison et al., 2016).

1.3 Purpose of the Study

The purpose of this study was to determine the effects of mental health on the productivity of
employees within financial institutions: A case of commercial banks in Kenya.

1.4 Research Questions

1.4.1 How does work-related stress affect the physical and mental health of employees in
Commercial banks?
1.4.2 What are the effects of absenteeism on the performance of employees in commercial
banks?
1.4.3 What are the effects of depression and stigmatization on the performance of
employees in commercial banks?

11
1.5 Significance of the Study
The findings of this study may be significant to the following stakeholders:

1.5.1 Stakeholders and Managers

The managers may use the findings from this study to improve efficiency and effectiveness
in their organizations. It may increase the knowledge resources available to be utilized by
managers and stakeholders on how to support employees experiencing mental health
disorders through training. This research may also equip the stakeholder and managers with
skills on how to eradicate the stigmatization of people with mental health disorders. This, in
turn, may increase employee loyalty and reduce turnover within the banking sector. The
Commercial Bank may also use the findings of this study to determine how to attract and
retain top talent, create a culture of employee loyalty to their brand, increase efficiency and
effective customer service, and devise new ways of attracting and retaining more customers.

1.5.2 Competitors

This study may be used to promote competition within financial institutions as industry
players may find useful information that they may use as a guide on how to handle employee
welfare, thus attracting and retaining top talent. This may spur competition within the
financial market as many competitors may also choose to implement the recommendations in
this study in an attempt to surpass their competitors in attracting and retaining top staff. They
may need to train their managers on how to identify and support employees suffering from
mental health in good time before mental health affected the productivity within the
organization. This may also help them build stronger relationships with their employees who
would, in turn, ensure that their goals are aligned with the organization’s goals.

1.5.3 Human Resource Consultants

The findings of the study may help the human resource consultants identify the employees
who are suffering from mental health, and also equip consultants with the technical
knowledge to ensure that they help the employees and end mental health stigmatization in the
workplace. The information may also help consultants discern the link between mental

12
health and

13
employees’ performance in an organization. Importantly, this may help them in their
consulting work as they dealt with companies that experienced a high turnover rate. This may
be vital, especially because mental health in organizations and companies is steadily
becoming a source of concern.

1.5.4 Scholars and Academicians

To the scholars and academicians, the study may add to the existing pool of knowledge about
the banking industry and provide a pivot for future reference. It may increase their
knowledge of mental health since mental health gained global popularity due to its numerous
effects on businesses. This may also help scholars and academicians in their capacities by
equipping them with the skills and knowledge that they may use to lead healthy lives.

1.6 Scope of the Study

The study focused on the effects of the mental health of employees and how it affects their
productivity. An analysis was carried out in Commercial Banks in Kenya with a focus on the
Cooperative Banks, Bank of Africa and National Bank of Kenya. The population of interest
in this study was 300 employees from the Cooperative Bank, 200 employees from Bank of
Africa and 300 employees from the National Bank of Kenya totaling 800 employees. The
main challenge found was in data collection as some respondents declined to participate in
the study. To mitigate this, the researcher provided an official letter from the university
indication the purpose of the study, thus encouraging participation.

1.7 Definition of Terms

1.7.1 Productivity

Productivity refers to the measure of the quantity and the quality of work performed by an
individual or a group with resource deployment taken into account. It is measured at an
individual, group or organization level (Ayodele, 2014).

14
1.7.2 Mental Health

Mental health is a state of well-being that enabled a person to realize his or her potential
where they could deal with normal stress, the pressures of life, and could work well and be
productive so that they can contribute to the community at large (WHO, 2014).

1.7.3 Depression

Depression is a mental disorder characterized by sadness, loss of interest or pleasure, feelings

of guilt or low self-esteem, unhealthy sleeping habits, and poor concentration in an
individual. People suffering from depression rarely feel rejuvenated and are often unhappy.
Depression and its symptoms can be managed and treated by consultation and medication
administered by a psychiatrist. Depression, if not treated early, can lead to suicide (WHO,
2017).

1.7.4 Stigmatization

Stigmatization refers to the act or omission by a person or an entity that causes another to
feel disgraced and that he or she does not belong. A negative attitude is evoked by people
who are stereotyped because of their illness. Due to feeling isolated, stigmatized individuals
often display aspects of self-blame. This deters and discourages them from seeking help to
get better (Arboleda-Flórez & Stuart, 2012).

1.8 Chapter Summary

Chapter one laid the foundation for the study. It presented the background of employee
productivity as it highlighted the variable of the study, namely mental health and employee
productivity. In addition, the chapter presented the statement problem, the purpose of the
study, the research questions generated for the study. It concluded by presenting the
justification of the study, the scope of the study, and the definition of the teams used in the
chapter. Chapter two analyzed the literature review and provided a detailed explanation of
the research questions to determine the effect that work-related stress has on the mental and
physical health of employees in financial institutions. It also investigated how absenteeism
affected employee performance, and finally analyzed the effect of depression and
15
stigmatization on employee

16
performance. Chapter three discussed the research methodology, which included the data
collection, target population and the tools used to analyze the data. Chapter four presented
the research findings on the general information about the respondents and chapter five
discussed the conclusion and recommendation of the analysis done using the research
questions.

17
 CHAPTER TWO
2.0 LITERATURE REVIEW
2.1 Introduction
This chapter reviewed the literature on the effects of mental health on the productivity of
employees working in financial institutions with focus on commercial banks in Kenya. The
first section analyzed the effects of work-related stress on mental and physical health, the
second section analyzed the effects of absenteeism on employee performance, and the third
section analyzed the effects of depression and stigmatization on employee performance
within Commercial Banks. The chapter concluded with a summary of all of the analyses
done.

2.2 Effects of Work-Related Stress on Mental and Physical Health of Employees

2.2.1 Stress

Stress is caused by nonspecific demands that we put on our bodies aimed at the
accomplishment of the objectives we aimed to achieve in the short term. It also occurred
because of the gap between the environment and an individual’s match and the interaction
with the situation of the individual. The stress concept was always accompanied by several
notions such as performance, motivation and the well-being of the employees and
organization. It was very difficult to keep up with the rapid daily life changes and the present
societal demands from an individual. These demands pressured an individual to keep up with
the modern complexities of life, without having time to reflect. Stress occurred when the
preset conditions to achieve certain goals became overwhelming. This precipitated
psychological problems among individuals. In the workplace, for example, shareholders
exerted pressure on managers who in turn transferred the same pressure to the employees to
achieve the company’s objectives, which was to maximize shareholders’ wealth
(Mutsvunguma & Gwandure, 2011).

A study done in New Zealand stated that they had several stress models relating to safety at
work and they were named in sequence. They included “A traditional model,” The bucket
model”, “An academic model”, “The demand, control, support model”, “The effect rewards
imbalance model”, “The status syndrome” and “An alternative model of stress”. All the
18
models had similarities in them. For instance, the traditional model was the stress that caused
the employee to have a perception in his or her mind that he or she was not be able to cope
with

19
the work given to them and this led to fatigue. The bucket model also described a condition
of fatigue that ensured that the employees linking the human body as a bucket that was full of
unpleasant experiences. It was noted that employees that work under stressful conditions
were likely to be affected by mental and physical health. Conflict at work and in the family
also increased the level of stress on the employees (Anderson & Taylor, 2012).

A study in Brazil on the major cause of occupational stress for employees that worked at the
bank stated that the stress was caused by characteristics of socioeconomic, demographic and
labor. This was a cross-sectional study done of 521 people aged 20 to 64 who worked in
Espirito Santo in the banking sector. The study noted that the factor that led to occupational
stress in Brazil included the employees that had worked in the banking sector for more than 5
years, lower education levels, lower support levels, and the working shifts in the banking
industry. It was also noted that the married or divorced employees’ were more prone to stress
and this affected their productivity at their workplace (Petarli, Zandonade, Bresciani, Salaroli
& Bissoli, 2015).

The prevailing economic conditions were dynamic and there were barriers for new players
who sought new business ventures, especially in financial institutions. A case in point was
the emergence of corporations like Safaricom, which introduced mobile money lending
facilities based on mobile banking, at a time when the Central Bank of Kenya had
implemented a law capping interest rates for loan facilities at 14%. This was not
economically favorable for the existing financial institutions (e.g. banks) since it reduced the
scope and volume of their lending business. This reduced business lending process which
strained the business and lending practices of financial institutions and therefore led to
diminished profitability compared to the profit margins registered before the capping of
interest rates (CBK, 2018).

Work-related stress also emanated from the unfavorable work conditions employees faced in
their workplace, high demands, and pressure to ensure efficient job performance. It was also
triggered when the employee experienced unpleasant emotional states in their workplace.
When the pressure became unbearable or the employee could not cope with his day to day
job requirements, the employee was at risk of breaking down and developing mental
20
health

21
problems such as depression. This behavior was very common in financial institutions
because employees were given unrealistic targets, which was often accompanied by being
fired from the job for failure to meet the set targets. Cases of employees devising “creative”
means to reach their targets became rampant, with many employees conspiring with
scammers and cybercriminals to commit bank fraud through online and mobile banking
platforms. This was borderline illegal, albeit that it was attributable to the employee’s
adjustments to meet unrealistic targets to survive the current unforgiving economic
conditions, as well as safeguard their employment. Stress destroyed the health and
productivity of employees and led to, or even worsen other health complications. Employees
also felt neglected when they gave their best to an organization but were not equivalently
supported by the managers. They felt that their contribution to the enterprise was ignored
(Ayodele, 2014).

Organizational stress negatively affected a company’s productivity as it affected the physical

and mental health of the employees. The source of the stress was traced to money, health,
work overload, and pressure to achieve goals in an unresponsive market. Employees who
suffered from organizational stress were noted to have a desire to leave the organization.
Therefore, strategies were put in place that ensured that the employees were not stressed to
avoid them leaving the organization (Mxenge, DyWili & Bazana, 2014).

Othman, Lamin, and Othman (2014) explained that stress in the workplace was also caused
by the leadership of the company’s management staff, poor working conditions, and lack of
motivation. It also emanated from employees’ inability to cope with the often-burdensome
work demands that they are entrusted with. Moreover, within a financial institution, an
employee could have worked in a particular department e.g. sales, for several years without
salary review or promotion. The situation was further complicated due to increased tax
burden in the country. Considering the employee had family obligations, his or her salary
was insufficient to enable him or her to meet these obligations. This forced an employee into
borrowing money to survive the harsh economic times. This led to frustration and stress,
which ultimately lowered that employee’s efficiency and productivity in the workplace, and
therefore, reduced the company’s profitability. Eventually, that employee’s self-esteem was
lowered if
22
the management staff failed to address his or her concerns by providing sufficient
remuneration and a conducive work environment (Ayodele, 2014).

Employees who worked with people they didn’t like at the workplace experienced stress.
Spending long hours each day at the workplace with people you hate led to mental illness
hence the employees needed to find better ways to improve their relationships in the office to
avoid the effect of stress on them and their productivity. On the other hand, employees
needed to have clear goals from their employers, have qualifications for the job as this
reduced the job stress since they focused on performing well and met their expectations.
They needed to have the knowledge, skills and a great attitude towards the work they did for
them to perform well. The reverse was also true, if the employee had no skills for the job
given, they did not perform well and this led to the employee having stress (Warraich,
Raheem, Ahmad & Khoso, 2014).

Work-related stress was a factor that deserved the attention of human resource managers with
the help of other managers to address issues that arose in the company as well as implement
measures for early detection and alleviation of those issues. When employees are satisfied,
they performed better, hence increased productivity would be experienced in the company
(Storey, 2013). The Human resource department should have ensured that strategies were put
in place to identify and treat stressed employees before they fell into depression. If
employees knew that their employer valued their well-being, they would be more productive
and willing to contribute to the growth of the business. This encouraged a win-win situation
for the business and the employees (Ayodele, 2014).

2.2.2 Work Overload

Work overload is where an employee had a heavy workload with close deadlines that he or
she unwillingly forgoes his or her basic and usual needs, such as lunch break. It was also
characterized by the extension of work hours, expansion of workdays, etc., all of which could
led to physical, mental, and emotional stress. Some symptoms of work overload included
lack of sleep, headaches, unhealthy eating habits, immobility or reduced mobility, irritability,
and living in denial of the problem. Work overload affected the employees and led to mental

23
health complications, such as depression. Moreover, it could cause episodes of anxiety
attacks, and

24
detachment from family members and friends. In most cases, work overload is usually
involuntary (Abbasi, 2015).

According to Amigo, Asensio, Menendez, Redondo and Ledesma (2014) the employees of
the Spanish Savings Bank and the branch level suffered from mental health because they had
too much work. They also had to deal with clients who came to the branch and calmed them
down when their facilities were not approved by the employees at the central office. Dealing
with the number of clients they had at a time became overwhelming and this affected their
productivity at the branch as they tried to meet their targets. In Brazil, it was also noted that
the employees that were married or divorced felt like they had more work than single
employees. This was because of the responsibilities they had back home that also required
them to deliver (Petarli et al., 2015).

Work overload in financial institutions was evident when managers and supervisors assigned
employees duties that do not correspond to their service charter or job description. Often, an
employee was asked to perform tasks that would ordinarily fall under the assigning
manager’s job description. Even though the employee did the extra work, the assigning
manager got all credit and honor for the good performance and the employee was blamed for
any misdeeds. This occurred in financial institutions and was usually justified by the false
idea that the employee’s work was to make the boss look good. Overworking employees led
to more harm than good. It made the manager look bad as it exposed his or her inefficiencies.
Due to work overload, the employee fell into depression or started abusing drugs in an
attempt to cope with the overwhelming workload. It also caused family problems and loss of
family time and consortium. This ultimately affected the employee’s well-being and not only
lowered his or her productivity but also rendered him susceptible to mental health
complications (Abbasi, 2015).

Employers and human resource managers ought to ensure that they assigned well-balanced
and manageable tasks to employees. This called for proper job design, analysis and appraisal
to determine potential areas of overload as well as deficiencies within the workplace. This

25
resulted in increased productivity of the employees, hence boosting the company’s
profitability (Bidisha & Mukulesh, 2013).

2.2.3 Burnout

Burnout was a major source of stress in the workplace. It resulted from the constant feeling
of exhaustion due to work overload, and caused emotional exhaustion, depersonalization and
therefore affected the sense of personal accomplishment of an individual. It decreased the
feeling of job satisfaction, happiness, mental health stability and well-being of the
employees. Victims of burnout suffered from insomnia, back pain, and had coronary
problems. They were also predisposed to unhealthy coping mechanisms, such as smoking,
drinking, and substance abuse. Employees who suffered from burnout developed a negative
attitude towards their career and lacked enthusiasm, proactivity, and diligence in their work
(Rupert, Miller & Dorociak, 2015).

Research that was done in the Spanish banking sector investigated how burnout affected the
mental health of bankers. The population that was studied came from the Spanish Savings
Banks with a total of 1,341 of whom 883 were men and 458 were women. Most of the
employees worked at the branch level and had contact with the client while fewer employees
working in central office. The employees that worked at the branches reported a high rate of
emotional exhaustion that led to mental health and their productivity was found to be very
low due to the mental exhaustion. This caused risk in the business and employees’
productivity was lowered. The explanation was that at the branch level the employees had
contact with the client with severe economic problems and they had to deal with them. This
meant that the employees at the branch office were at risk of burnout than the central office
employees (Amigo et al., 2014).

According to Mutsvunguma and Gwandure (2011), it was important to note that occupational
stress caused burnout within the organization. Businesses that invested in psychological
helped for employees who from mental health. On the other hand, the human resource
manager would ensure the employees go on leave (Amigo et al., 2014). The availability of
employee leave days was an important tool when dealing with burnout. It was the human

26
resource manager’s

27
responsibility to ensure that all the employees were given equal and undisturbed leave days.
Unfortunately, in most financial institutions and other companies, employees were paid
instead of taking leave. Employees who sought to make extra money were more inclined to
accept the pay offered to them. According to Psychiatrists, employees required time off work
to allow them rejuvenate and to clear their minds. This time off was refreshing and enabled
employees to be well-rested and energized when they resume their normal work. Burnout
was the leading cause of poor service delivery in financial institutions. In addition, it was
associated with susceptible mental health complications and considered a potential hazard not
only for the affected employee, but also for the company (Green, Albanese, Shapiro, &
Aarons, 2014).

To deal with burnout in financial institutions, human resource managers had to adopt a
permissive stance to employees’ leave days, as well as devising extra mechanisms that
ensured that each employee had equal opportunity to rest. This was good for the business as
it boosted efficient service from employees who were well-rested and rejuvenated. Some of
the factors that affected employees’ performance in the workplace were intangible factors
such as work environment, atmosphere, and work conditions. To avert burnout, the
management was duty- bound to cater to their employees’ health. Research had established a
direct correlation between employee efficiency and apt management of their mental as well
as physical health. Employers who catered to their employees’ mental and physical health,
and ensured that they are well motivated, reported improved work productivity and
efficiency. This inevitably translated into an overall increased profitability for the company.
Enhanced profitability of any company was realized when employees performed their work
well. This called for deliberate measures and mechanisms that ensured the sustainability of
the physical and mental health programs that were designed for the benefit of the employees
(Sowmya & Panchanatham, 2011).

Sowmya and Panchanatham, (2011), explained that very few organizations had invested in
taking care of their employees’ mental and physical health. These companies registered
benefits of increased efficiency, productivity, and profitability in their businesses. Positive
employee feedback and engagement also helped to increase the level of creativity in the
company as well as inculcating different levels of positive interactions and attitude of the
28
employees. The employees, therefore, felt empowered to take part in the decision-making
processes within the company. There was a strong correlation between the well-being of
employees and their productivity in the financial institutions (Rupert, Miller & Dorociak,
2015).

2.3 Effects of Absenteeism on the Performance of Employees

2.3.1 Work-life Balance

Work-life balance is very important in an organization as it affected the employees’

productivity and the overall success of the company. The work environment required an
individual to maintain a stable balance between work and family time. Work-family conflicts
arose when an individual’s work interfered with, limits, or undermines his or her family life,
for example through keeping inflexible work hours, work overload, and unsupportive
managers. Family-work conflicts escalated by unsupportive partners or family members. It
was thus important for an organization to develop a culture that encouraged better
management of work-family balance amongst its employees. This permitted the employees to
lead quality, balanced lives, which increased their concentration and productivity at work
(Mani, 2013).

According to Mukururi and Ngari (2014), work-life balance increased the efficiency of the
employees in the working place which in turn increased productivity at the workplace and
when there is no work-life balance, the employee’s productivity decreased. It was important
to note that today’s employees have competing responsibilities like family responsibilities,
society, children and their parents who are elderly and this caused them to have stress which
affected their productivity at work. Research done stated that well-balanced employees are
mentally healthier since they are in a better position to meet the goals and objectives of the
employer and increase their productivity (WHO, 2014).

In the bank of Accra in Ghana, it was noted that work-life balance had a great impact on the
employees. There was need for employees to strike a balance between work and social life.
Most of the employees in Accra bank in Ghana stated that the bank gave them limited time to
do their social responsibilities and this was because of the demands or the obligations they

29
had at work. The researchers suggested that there was need to educate the employees on
time

30
management so that they could interact with their families. They also suggested that they
take help from social workers as this led to increased commitment of the banker to their work
as well as improved productivity (Macais, 2014).

The main aim of any company is to maximize shareholders’ wealth. This was only
achievable if the employees were well motivated and adhered to the set work hours and
timelines. It was, therefore, incumbent upon employees and the company to develop a
suitable work plan for maintaining a stable work-family balance. In addition, maintaining this
balance assisted employees to achieve self-gratification and job satisfaction. The
management had to be relatively and cautiously concerned about their employee’s personal
lives. This enabled the company to establish the existence of potential areas of work-family
conflicts from the onset, thus enabling early mitigation before the situation worsened. This
must, however, be conducted with the utmost restraint, and in a friendly manner to avoid
intrusion (Azeem & Akhtar, 2014).

Human resource management needed ensure that employees took their leave days by acting
as the employee’s advocates on such matters. This had to be a deliberate effort by the
management to ensure that all employees took their leave days in a planned manner that
would not lead to overloading other workers. Together with consultative and constructive
forums for both formal and informal communication, early and adequate planning of leave
days were good avenues through which the management gained insight into the difficulties
facing employees. Once the employees gain trust in such systems, and in human resource
management, they would feel comfortable sharing their problems in good time, therefore,
affording the management sufficient opportunity for intervention (Hye, 2014).

Work-life balance was very important for the career growth of the employees. It was notable
that if work was given more priority than other important aspects of personal life, either one
was likely to suffer. Employees needed growth in both their work and their personal lives.
This offered them a sense of fulfillment. Engaging in certain activities such as participating
in training workshops and team-building exercises, were amongst the mechanisms that assist
employees in attaining work-life balance, as well as capacity building. In addition, these
activities were valuable to employees’ skill set as they aided them to attain new talents and
31
revelation of latent abilities. They also assisted employees in winding down and releasing
work pressure. Eventually, this was beneficial to the company as it enhanced employee
morale, productivity, and the company’s profitability (Hye, 2014).

In financial institutions, the human resource departments were entrusted with the
responsibility of discerning and identifying occurrences of a work-life imbalance amongst
employees. Specialized training and a suitable work environment were requisite in combating
this problem. Offering employees a conducive and supportive work environment helped the
management in eliminating work environment as the potential cause of work-related
pressures such as absenteeism from work. This made it easier for employers to investigate
other potential causes of stress whilst unconducive work environment led to absenteeism
from work. Since a properly managed work-life balance increased the productivity of the
employees in the company and reduced absenteeism from work, the human resource manager
had to devise strategies that enhanced work-life imbalance amongst employees (Azeem &
Akhtar, 2014).

2.3.2 Leadership Styles

Leadership is defined as the act of influencing a group of employees to achieve a common

goal. Leadership styles are diverse, and they encompass mannerisms through which leaders
within an organization exercise influence over other employees to achieve the organizational
goals. In each organization, there were different mechanisms used to ensure that the
employees optimally performed their duties. According to Kerzner, issues relating to people
in an organization played a big role in employees’ productivity. Productivity also depended
on the leadership style that was employed by management in inducing when influencing
employees to perform efficiently. It was, however, crucial to distinguish between
management and leadership, even though the two terms were often used interchangeably.
Management mainly involved planning, organizing, and making decisions aimed at
increasing the effectiveness and efficiency of employees to achieve the organization’s goals,
while leadership referred to motivating employees to realize their potential and encouraging
them to overcome difficult challenges within the organization (Kerzner, 2016).

32
Transactional leadership is related to work and reward and is more suitable in an
organizational setting. Transformational leadership, on the other hand, concerns itself with the
relations within the organization. Many researchers had conducted investigations on the best
leadership style suitable for an organization. According to Chaudhry and Javed (2012),
leaders needed to motivate the employees to accomplish the goals within the organization.
They had to interact with employees and motivate them to help them achieve the
organization's objectives. Leaders were the source that enhanced employee's performance
and made them contented towards their jobs. This helped the employees perform better and
increased their productivity in the organization (Chaudhry & Javed, 2012).

In financial institutions, the leadership style used was linked to various sources of conflict
within the institution. For example, a particular leadership style was linked to problems
caused by employee absenteeism from work. Some scholars explained that leaders who
demonstrated high levels of job satisfaction and commitment to their work were likely to
have employees who were satisfied with their work, in the end, and therefore, eventually
reduced cases of absenteeism in the workplace as a factor that directly affected the
productivity of the employees in the institutions. Human resource management also needed to
enact plans for motivating employers to investigate employee satisfaction. This helped
reduce cases of absenteeism within the institution. A spot check of many financial
institutions revealed a grim reality characterized by low employee morale, which inevitably
adversely affected their productivity (Keegan & Den Hartoy, 2014).

Leadership styles played a major role in managing employee absenteeism from work.
Transformational leadership encouraged employees to achieve their personal goals and
organizational goals were also achieved in the process. This leadership style ensured that the
employees were well catered for and were empowered to make critical decisions in the
organization. This level of inclusivity in decision making, mirrored within the framework, a
guide of transformational leadership and applied in the context of financial institutions,
motivated employees into increased productivity as it also lessened the chances of
absenteeism from work by cultivating a sense of belonging (Kerzner, 2016).

33
Employee empowerment was another method that was used to curb absenteeism from work
while offering support to employees in their line of work and entrusting them with
responsibilities that were commensurate with their training, competence and job description.
Employee satisfaction also reduced the chances that employees would take fictitious sick-
leave. Research showed that in some cases, employees use sick-leave as an excuse to take a
rest or to apply for employment elsewhere (Kreitner & Kinicki, 2016).

Employee empowerment helped nurture trust between them and their employers. It also
positively impacted employee satisfaction, whilst reducing absenteeism from work.
Employees experiencing low job satisfaction tend to call in sick more often than their
satisfied co-workers. Those with leadership positions in organizations were responsible for
managing employee sick-leave applications. In handling sick-leave applications, certain
safeguards ought to be adhered to, including proof of medical attention offered to the
applicants, or proof of attendance in medical facilities. The purpose of these safeguards was
to ward-off pretentious sick-leave applications by deceitful employees. It was common sense
that the absence of measure required proof of illness, attendance in medical facilities and
medical attention rendered led to sick-leave management mechanisms that were prone to
abuse hence encouraging employee absenteeism from work (WHO, 2018).

An organization’s management structure and leadership ought to treat all employees equally
when considering applications for sick-leave, while at the same time, strictly following
procedures for managing such applications to manage employee absenteeism from work.
Transformational leadership was sometimes regarded as a catalyst for employees because of
its stand on sick-leave procedures. This was mainly attributable to its tenets, which was pro
employees’ well-being, to the extent bordering on complacency and clouded judgment. There
was need to maintain a healthy balance where an employee’s well-being was catered for
without sacrificing the organization’s needs and objectives. A transformational leader was
required to exercise caution when presented with reasons for absenteeism by employees.
These reasons ought to be backed by strong evidence and adherence to proper protocols and
procedures enacted by an organization (WHO, 2018).

34
2.3.3 Job Satisfaction

Job satisfaction is a feeling of fulfillment or enjoyment that a person derived from their job.
Psychological, physiological and environmental factors are some of the determinants of job
satisfaction. Satisfaction had a major effect on job performance, employee motivation,
turnover, productivity and profitability in an organization. For employees to feel motivated
they had to be satisfied with their job. According to Herzberg’s motivation theory, only
motivation led to job satisfaction among employees. Human Resource management and
department managers were therefore responsible for devising ways for motivating employees
in an organization to record increased productivity and profitability. Hygiene was part of the
environmental factors that promoted job satisfaction, albeit that whilst employees may be
satisfied with the work environment, they may nonetheless feel less motivated hence less
productive due to other factors (Storey, 2013).

In India, research done in the banking sector revealed that employees that were overworked
lost their morale. This was because they had targets they had to meet over a short period and
also be available for their families. This was experienced mostly among married or divorced
people. The vice versa was also seen to be true. The staff members who were underworked in
the bank felt like they had nothing to offer and this affected their job satisfaction which in
turn affected their productivity at work (Devi & Sharma, 2013).

When employees are satisfied, they redefine their needs and aligned them with the goals and
objectives of the organization. Financial remuneration played a significant role in
determining employee satisfaction. There was a direct correlation between adequate
remuneration and employees’ productivity. An employee who was adequately remunerated
financially was more satisfied and motivated to work harder, smarter and better, and
therefore, increased productivity at work. Simply put, satisfaction led to motivation
(BassetJones & Lloyd, 2005). Human resource management assisted by other relevant
managers were mandated to guarantee adequate remuneration of employees as satisfied
employees were motivated to perform better than before, hence registering increased
productivity (Storey, 2013).

35
Institutions could discern the level of job satisfaction of employees by scrutinizing the rate of
absenteeism those employees registered. Incidents of unnecessary applications for sick-leave,
cases of unnecessary leave days and attempts by employees to obtain fake documents from
the doctor to justify dishonest sick-leave requests indicated an absence of job satisfaction.
This presented a significant challenge to the employer as some employees got away with
falsifying sick-leave applications (Devi & Sharma, 2013).

Absenteeism from work due to lack of job satisfaction undermined the efforts of other
employees in achieving the objectives of the organization since many employees lagged in
their work. Moreover, other employees felt stagnated in their work since their work was
interrelated to or dependent on input from their fellow employees who were frequently absent
from work. According to many Scholars, employees who disliked their jobs were more likely
to miss work compared to those who liked their job because they would not go the extra mile
to meet the objectives of the organization as this was not a priority for them (Dewa &
McDaid, 2011).

2.4 Effect of Depression and Stigmatization on the Performance of the Employees

2.4.1 Motivation

According to Dwight D. Eisenhower, “Motivation is the art of giving employees the liberty
to do want you want them to do because they like what they do” and therefore want to do it.
Motivation was dependent on the fulfillment of fundamental, innate psychological needs for
competence, relatedness, and autonomy (Thijs, 2011). Motivation can also be defined as the
“want-to” component of a person’s actions (King & Teo, 2012).

Motivation could either be intrinsic or extrinsic. Intrinsic motivation occurred when

employees perform a task for their satisfaction, therefore, this type of motivation was
associated with a sense of internal reward unrelated to money. This meant that motivation
came from within because the employees were satisfied with the work. The employees
enjoyed undertaking duties assigned to them since it allowed them to learn, explore and
actualize their plans. The kind of reward attained from this kind of motivation was intangible.
Extrinsic motivation, on the other hand, was associated with an external reward that an
36
employee got for the work done.

37
Examples of such rewards included salary, wages and promotions. An employee in
manufacturing taking part in the production of certain items as part of his or her work may
perform according to targets set for him to achieve, even though he may not enjoy his work.
His source of motivation in this instance is the money handed to him for the work completed.
Managers were entrusted with the responsibility of identifying and implementing the most
suitable ways of motivating their employees to achieve the desired results from them
(Backlund & Suikki, 2015).

Management needed to put more focus on motivating their employees if they desired great
results from them. Skills, clear objectives, the provision of a conducive and supportive work
environment were not enough to foster productivity and creativity from employees.
Employee motivation impacted their productivity in an organization (Bhuvanaiah & Raya,
2015). Lack of motivation from employees was a concern to an organization since low
productivity led a company to lose revenue especially keeping in mind that the employee got
paid to be productive at work. An employee who lacked motivation could transfer his or her
negative influence and energy to others who are well-motivated. This led to large scale
demotivation of employees within the workplace, especially where the unmotivated
employee commanded a lot of trust or exerted significant influence on others (Jobber & Lee,
2014).

Researchers came up with different theories of motivating the employees. Perhaps the most
important utility of employee motivation was ensuring organizational prosperity, by taking
care of the well-being of the employees. This topic had been extensively researched and
documented. One of the earliest scholars on this topic comprised the works of Frederick
Herzberg and Victor Vroom. According to Hur, (2018), as he tested Herzberg theory, to
predicate the two-factor theory, employee motivation was the act of performing a duty
simply because it was in your interest. It may, therefore, be considered that employee
motivation depended on one’s desire to perform work-related activities. A study was done to
identify the effects of motivators and hygiene factors on the public managers’ job to
investigate if there were differences in how employees in the private sectors were motivated.
It was noted that employees that were well motivated performed better hence having a
positive effect on job
38
satisfaction however, in this case, hygiene never affected their job satisfaction as stated in
Herzberg’s study (Hur, 2018).

It was therefore incumbent for organizations to motivate their employees to promote good
results. Scholars agreed that employee motivation was tied to unmet needs, which was a
factor for motivation and that it varied from one individual to another. To understand this
notion, it was important to first succinctly define it. This section investigated historical usage
of the term “motivation” and various suggestions fronted to suggest a suitable definition. The
historical origin of the term “motivation" could be traced to the philosophers of old and
social theorists when the term “will” was commonly used to denote motivation. Philosophers
like Forgas, Williams and Laham stated that motivation meant an entity that persuaded
employees to perform a task. According to other suggestions, motivation involved the
psychological process that gave behavior purpose and direction while other scholars
explained that it was an internal drive that compelled the employees to satisfy their unmet
needs (Kreitner & Kinicki, 2016).

Motivation, in strict contemporary sense from a management perspective, meant the

deliberate efforts aimed at providing motives for a certain event to occur or increased
frequency of its occurrence. In the organizational set-up, however, motivation meant several
things. Amongst the most accepted notions of the term included means and ways of
encouraging employees to work better and more efficiently to benefit an organization by
providing them with benefits informed by their unmet needs. According to Maslow, the
hierarchy of needs was used in a motivational theory in psychology, which included
physiological needs, safety needs, love and belonging, esteem, and self-actualization and the
needs had to be fulfilled in that order. This meant that the need on the lower tier had to be
satisfied before the individual attended to the need on the higher tier (Cherry, 2015).

Having a highly motivated employee did not guarantee higher productivity in the
organization. The company had to focus on the improvement of skills and personal career
development of the employees through e-learning and empowerment to make sure that they
were adequately prepared to perform their tasks and become more productive (Riggio, 2014).
Human resource management played the biggest role in employee’s productivity.
39
Individual appraisal and a

40
better relationship with the employees, enabled them to feel valued by the organization and
improved their morale. The managers ensured that the employees understood what they were
supposed to do, that they are adequately equipped to handle the task and they ensured that
they were willing to go the extra mile. They were also in a position to align all their strategies
to their mission, vision and goals of the organization. This increased productivity within the
organization (Riggio, 2014).

Maslow’s hierarchy of need stated that employees’ well-being was a paramount

consideration if an employer was to achieve higher productivity in the business. It was vital
to understand that lack of motivation led to depression. Both the physical and mental health
of employees were prioritized to ensure that they never fell into depression. In financial
institutions, employees fell into depression due to various factors, yet there were no proper
channels for reporting their depression to human resource departments. This was because
they feared being dismissed from work once they reveal that they were depressed. People
who suffered from depression, especially in Africa, were stigmatized since they did not
believe in sharing their issues with a psychiatrist. The few educated individuals who
understood that depression could be treated, often faced stigmatization from the public. This
prevented them from sharing their problems with their co-workers. The World Health
Organization formulated ways that assisted businesses with knowledge on how to treat and
support people suffering from depression. It also provided training aimed at combating
stigmatization of persons suffering from depression (WHO, 2018).

2.4.2 Employee Turnover

Employee turnover refers to the number of employees who left the organization for one
reason or another and are replaced by new ones. Employee turnover also connote the
frequency by which employees left employment. A high staff turnover, if not addressed in
due time, posed a serious problem in the effectiveness of an organization. Gauging employee
turnover enabled human resource management determine the reasons for the turnover. This
knowledge was useful in formulating ways to mitigate the high rate of turnover or mitigating
its effects. A high rate of employee turnover led to demotivation of other employees within a
company and if no
41
action was taken, it translated into a loss of revenue for the organization. These losses were
overwhelming to the organization because the process involved employing new employees
and training the new staff was very expensive (Bidisha & Mukulesh, 2013).

According to Oginni, Afolabi and Erigbe (2013), job stress affected staff turnover in the
workplace after research done in Nigeria on employees in the banking sectors. They stated
that the factors that affected the employee were employee’s personal problems, polices,
pressures in the workplace environment and their job security. This was a survey done from
533 respondents of both genders. They noted that the materials that the employees needed to
work were not adequately given and some of the policies at work made their job hard and
unbearable. The pressure that came from the employer was a lot compared to the
remunerations. The research concluded that for the employees to work better and to be
productive in the banking sector, they needed to provide a better working environment for
them (Oginni et al., 2013).

Scholarly research suggested various varying reasons that led to high turnover, ranging from
the policies adopted by the organization, the organizational culture and employee expectation
to the remuneration adopted by the organization. Employee turnover was either voluntary or
involuntary. Voluntary employee turnover occurred when an employee left the organization,
whereas involuntary turnover occurred when the organization terminated the employee’s
services, for example, due to integrity issues (Mita, Aarti & Ravneeta, 2014).

In India, one of the major reasons why there was a high turnover in the banking sector was
the amount of work they were allocated. According to Preshita and Pramod (2014), many
bankers in Indians who had occupational stress left their jobs because of the pressure that the
banking sector had, especially the employees at the branches. It was also stated from the
research that overworked employees and employees with unclear roles in the organization
suffered from mental health. This was a sample done by 501 Indian employees in the banking
sector (Devi & Sharma, 2013).

Organizations that had apt policies that dealt with the mental health of their employees
registered lower turnover rates. This was because they were in a better position to consider
42
their employees’ grievances and were, therefore, able to solve the problems experienced
within the organization. Human resource management was responsible for ensuring that all
employees’ grievances were addressed in good time and that employees’ needs were met. An
organization that considered and solved their employees concern experienced low rate of
employee turnover and recorded high productivity. Similarly, organizations that had earned
trust from their employees were better positioned for success and had a competitive
advantage over other businesses in the same industry (Bidisha & Mukulesh, 2013).

Human resource managers needed to formulate avenues that allowed their employees,
especially those at risk of developing mental health complications, share with the managers
on matters concerning their mental health. This information had to be shared confidentially
and in a safe environment to allow the treatment of the victims and apt management of the
situation without discrimination. This was a better way to build trust between the employees
and human resource management within an organization. In addition, it enabled the
concerned organizations to assist affected employees by addressing mental health
complications that faced them before they left employment. It reduced the number of
fatalities associated with mental health complications within the workplace, as well as
reduced stigmatization of employees (Corrigan, Kosyluk & Rüsch, 2013).

Organization may also come up with punitive rules and guidelines applicable to a person who
discriminated against people suffering from mental health complications. This would cushion
the business enterprise against the adverse effects associated with the stigmatization and
discrimination of employees suffering from mental health, including the adverse effects on
their productivity. Eventually, this would be a win-win situation for the institution and the
employees (Bidisha &Mukulesh, 2013).

2.4.3 Training and Development

There are numerous definitions of training. It can be defined as a systematic way of gaining
knowledge, skills, and abilities required by an employee to perform a certain task (Shaheen,
Naqvi & Khan, 2013). Training included learning new processes that enabled employees to
work with ease or equipped them with the requisite skills, knowledge and understanding

43
required for the completion of a certain task. It also connote a continuous process adopted by
human resource management to ensure the employees are updated and are at par with the
latest industry and practice changes. Training offered new skills required by employees for a
particular task. This prepared them for the job and advanced their potential to perform
optimally. Development referred to the processes that helped an individual to grow (Elnaga
& Imran, 2013).

According to the data collected in an Indian bank, employees that were not well trained or
that were underutilized within the bank suffered from mental health. This was because they
had targets that they needed to accomplish and yet they did not have the tools or skills needed
to accomplish them. This affected the productivity in the organization as well as the balanced
scorecard for the employees. The employees that were under-utilized within the bank also
suffered from mental health and this affected their productivity levels. They had the skills
and tools needed for the task yet they were underutilized (Devi & Sharma, 2013).

Training in an organization was essential for growth. Human resource management

departments were responsible for facilitating the training of new and maintaining current
employees within the organization. This included internal leadership training and orientation
training for the new employees to aid them in transitioning into the organizations culture.
They also needed to prepare roles for the trained employees to practice what they were
trained on. Leadership training equipped employees with the necessary skills for better
performance of their tasks, which ultimately enable them in strategy formulation and
decision-making processes that were beneficial to the organization (Ehnert, Harry & Zink,
2013).

Human resource management were expected to introduce professional development

opportunities for employees who desired to receive promotions, gain exposure to new
challenges and achieve their personal goals. Training enabled employees to act and work
professionally due to the added skills. Professional employees who were aligned with the
mission and vision of the company stimulated increased profitability for an organization.
This was accelerated by the fact that such employees were aware of the company’s broad
aspects of objectives and goals, both the short and long term goal. Although training and
44
development

45
was an expensive undertaking, it provided a great return on the investment. Human resource
managers were responsible for formulating a plan to train employees in areas with
deficiency. Amongst the areas that offered suitable training grounds had to be an area of
focus, they included training tailored towards early detection, treatment and management of
mental health disorder cases (Ehnert et al., 2013).

This training ought to apply to both the managers and the employees. It was an undeniable
fact that many people suffered from mental health disorders. Training was therefore
imperative to offer technical knowledge in the management and treatment of these cases.
Invariably, such training had to be directed at combating the stigmatization of mental health
cases in society. Justification for this tangent of training was based on the fact that society
had for long discriminated against people suffering from mental health disorders. Moreover,
society had also blamed those individuals for their situations. This led to entrenched and
systemic stigmatization, which led to an increased number of people suffering from
depression (Shaheen et al., 2013).

A properly administered training regime assisted in deconstructing societal discrimination

and systemic stigmatization of people suffering from mental health disorders. Depression and
stigmatization, especially in the workplace, negatively affected employee productivity.
Stigmatization also demeaned its victims by instilling in them a false feeling of shame for
something that was completely out of their control. Accordingly, as a community, it was
important to fight against stigmatization (Parcesepe & Cabassa, 2013).

2.5 Chapter Summary

This chapter presented the available literature on the effects of mental health on the
productivity of employees within financial institutions: A case study of commercial banks in
Kenya. The first section presented the effect of work-related stress on the mental and
physical health of employees in financial institutions, the second section investigated the
effects of absenteeism on the performance of employees, and the third section determined the
effects of depression and stigmatizations on the performance of the employees suffering
from mental

46
health disorders. The next chapter focuses on research methodology employed in data
collection.

47
 CHAPTER THREE
3.0 RESEARCH METHODOLOGY

3.1 Introduction
This chapter explored the research design adopted in conducting the study, the population
and the sampling design used in the study. In addition, it provided insight into the techniques
used in data collection and the justification for those techniques. It also explained the data
analysis method, the procedure used for the study, and the methods used for data collection.

3.2 Research Design

According to Cooper & Schindler (2013), a research design is a plan that a researcher uses in
the collection, measurement and analysis of data. It provides a logical sequence that
constitutes a connection between the research questions, empirical data collected and the
conclusion. This study used a descriptive research design to carry out this research.
Descriptive research design is a method used by the researcher to discover the factors that
cause a particular problem, hence assisting to analyze the problem under consideration
(Backlund & Suikki, 2015). It analyses the variables of interest to provide comprehensive
information on the data collected (Muiga, 2013). Burns, Veeck, & Bush (2016) stated that a
descriptive research answered the questions of who, what, where, when and how. A
descriptive research design method was used to answer the research questions outlined in
chapter one. It also aided in data analysis and the determination of the problem within the
institutions under study.

3.3 Population and Sampling

3.3.1 Population

According to Mugenda and Mugenda (2012), population refers to the total number of people
inhabiting a particular geographical location that was capable of investigation. It also refers
to the total collection of elements that are used for a study in a particular specified area. A
target population is a group of people from whom the researcher aims to collect his or her
data. In this study, the population referred to the number of employees within the stated
financial institutions from where data was collected. The population of interest in this study

48
was 300 employees from the Cooperative Bank, 200 employees from Bank of Africa
and 300

49
employees from the National Bank of Kenya totaling 800 employees. The study was
narrowed down to the three institutions due to the time it may consume to collect such
information and the financial obligation that was needed to collect the information. The
target population was distributed as shown below in Table 3.1.
Table 3.1: Population Distribution

Classification of Institutions Population Population Percentage

Cooperative Bank 300 37.5%
Bank of Africa 200 25.0%
National Bank of Kenya 300 37.5%
Total 800 100.0%
Source: Cooperative Banks, Bank of Africa & National Bank of Kenya 2019

3.3.2 Sampling Design

Sampling design refers to selecting a portion of the population to represent the entire
population for the study (Cooper & Schindler, 2014). It also referred to a method of
collecting observed items for a certain study that aimed to combine relevance to the research
purpose with economy in procedure. Sampling design is defined as the method chosen to
select the sample from the overall population. It consists of the sampling frame, sampling
technique and sample size described next (Creswell, Waite & Cooper, 2014).

3.3.2.1 Sampling Frame

According to Denscombe (2014), the sampling frame refers to a list of all the items within a
population capable of study. It is also defined as a master list of components of the
population from which a sample unit is drawn (Burn et al., 2016). The sample frame was
obtained from the Human Resource department for Cooperative Bank, the Bank of Africa,
and the National Bank of Kenya as it was seen to be the most reliable and updated source that
held such information.

50
3.3.2.2 Sampling Technique

A sampling technique is a method employed by the researcher to select the sample from the
population. It could be a probability or non- probability sample (Cooper & Schindler, 2014).
For this study, a stratified sampling technique was used. The stratified technique ensures that
the population is segmented into strata and a special population is retrieved from the different
strata that have been identified.

3.3.2.3 Sample Size

The sample size is defined as the actual number of people or phenomena selected from the
population to participate in the study (Denscome, 2014). Sampling allows the researcher to
conclude the population (Saunders, Lewis, & Thornhill, 2015). It is considered useful if it
allows the researcher to make accurate and reliable conclusions (Eldredge, Weagel, & Kroth,
2014). Using the formula below for a population size of 800 at 95% level of confidence with
a margin of error of 5%. The sample size for this study was 384 employees and was
distributed as indicated in Table 3.2.
Meredith (2005) format was applied where:

Sample size = (Zα/2)2 x P (1-P)

E2

Where: (Zα/2) = Z value (2.58=99%; 1.96= 95%; 1.645=90% confidence level)

In this case 1.96 used.

P = percentage proportion of choice (50% used for sample size needed)

E = margin of error (5%)

Going as per the stated assumptions the sample size would therefore be:

Sample size = (1.96)2 x 0.5 (1 - 0.5)

0.052

51
 = 3.8416 x 0.25
0.002.5
Sample size = 384 = 384 Respondents
Table 3.2 Sample Size Distribution

Classification of Population Sample Size Sample size % of

Institutions Total Population
Cooperative Bank 300 144 37.5%
Bank of Africa 200 96 25.0%
National Bank 300 144 37.5%
Total 800 384 100%

3.4 Data Collection Methods

Data collection is a systematic gathering and measuring of information on targeted variables
to answer the specific research question (Cooper & Schindler, 2014). A primary data
collection was used in this study. The tool used was a questionnaire. A questionnaire is a
research instrument containing a series of questions or schedules given to respondents to
answer survey questions. The administration of questionnaires is amongst the many methods
employed in data collection as the use of questionnaires is a very effective way of data
collection (Saunders et al., 2015).

The questionnaire had both open and closed-ended questions that were strictly related to the
study ensuring that the research questions were addressed. The respondents of this study
were dispersed in different areas within Nairobi, therefore, the questionnaire was the most
cost- effective way of data collection. The best method to deliver the questionnaires to the
target population was drop and pick method due to nature or work and the employees were
engaged by the client during the operating hours. The measuring scale adopted was the five-
point Liker scale with options for the possible responses, ranging from the two extremes of
“strongly agree” to “strongly disagree”, with other intermittent values included. Since the
research had three research questions, the questionnaire was structured as follows: Section A
captured the

52
demographic information; Section B, C, D addressed each of the research questions under
investigation.

3.5 Research Procedures

According to K’aol (2015), research procedures are the detailed steps that are undertaken
while conducting the research. The questionnaire was developed by the researcher and
presented to the supervisor for review to determine whether the research questions were fully
addressed. According to Mugenda and Mugenda (2012), 1% to 10% of the sample size was
the ideal size for a pilot test and this study used 10 respondents. This was also intended to
decipher any weaknesses within the questionnaire and to weigh the objectivity of the
questions, before collecting the data. The necessary adjustment on the questionnaire was
done. The researcher explained to the respondents the nature, purpose and importance of the
study, as well as assuring the respondents that their answers would remain confidential. The
same was done during the main process of collecting data.

Cronbach’s Alpha test was used to examine the reliability of the questionnaires. Reliability
analysis showed the consistency among the number of items constructed to collect the actual
results. The threshold for the Cronbach’s Alpha was set at >0.704. The permission to conduct
the research was obtained from NACOSTI. The researcher handed out the questionnaires
once the adjustment was done after the pilot test. The respondents were given two weeks to
complete the questionnaire and the researcher collected them to check if they were completed
well.

3.6 Data Analysis Methods

Cooper and Schindler (2014), define data analysis as the process of breaking down or
evaluating the data collected using analytical and logical reasoning. According to Saunders et
al. (2015), data analysis ensures that the researcher obtains useful and usable information for
his or her analysis. The collected data was coded, edited and analyzed using Statistical
Package for the Social Science (SPSS) version 24. Descriptive statistics were used in
analyzing the data using frequencies and percentages. The mean score and standard deviation
were used to determine the correlation between mental health and employee productivity.

53
Data interpretation was done through mean and standard deviation.

54
3.7 Chapter Summary
This chapter discussed the data collection methodology and defined the descriptive research
design that was used for data collection. In addition, it considered aspects relating to the
sample size, the sample frame, the population for study, the methods used in the collection of
primary data and its relevance to the study. It also discussed the instruments used for
interpreting the data (the software involved in capturing the data). The next chapter discusses
how data was collected and presented through graphs, pie charts, and tables to simplify the
analysis and interpretation of data.

55
 CHAPTER FOUR

4.0 RESULTS AND FINDINGS

4.1 Introduction
This chapter presented the research findings on the general information about the
respondents, the effects of work-related stress on the mental and physical health of
employees in Commercial Banks, the effect of absenteeism on the performance of employees
in Commercial Banks, and the effect of depression and stigmatization on the performance of
the employees in Commercial Banks.

4.2 General Information

4.2.1 Response Rate

The data used for analysis was collected from 300 respondents from the targeted 384
employees from the three financial institutions. The remaining 84 were incomplete and were
discarded which provided the study with a response rate was 78% as shown in Table 4.1.

Table 4.1 Response Rate

Questionnaires Frequency Percentage

Responded 300 78%
Not responded 84 22%
Total 384 100%

4.2.2 Gender of Respondents

Figure 4.1 presented the gender of the respondents. 45% were female while 55% were males.
More males participated in the study that the females. The results are as shown in Figure 4.1
below.

56
 Percent

Frequency

0 20 40 60 80 100 120 140 160 180

Frequency Percent
Female 135 45
Male 165 55

Figure 4.1: Gender of Respondents

4.2.3 Age of Respondents

The age range of the respondents varied: 5% were between ages 18-25, 35% were between
ages 26-30, 43.3% were between ages 31-35, and 16.7% were between ages 36-40. The
results are as shown in Figure 4.2 below.

140

120

100

80

60

40

20

0 18-25 26-30 31-35 36-40

Frequency 15 105 130 50
Percent 5 35 43.3 16.7

Figure 4.2: Age of Respondents

57
4.2.4 Highest Level of Education
The analysis further showed that the majority of the respondents (73%) had a degree as the
highest level of education, while the highest level of education for 27% of the respondents
was a post-graduate degree. The results are as shown in Figure 4.3 below.

Percent

Frequency

0 50 100 150 200 250

Frequency Percent
Postgraduate 80 26.7
Degree 220 73.3

Figure 4.3: Level of Education

4.2.5 Years of Experience in the Financial Institution

The study investigated the number of years the respondents had worked in the financial
institutions. The findings showed that 5% had less than 1year of experience, 41.7% had 1-5
years of experience, 36.7% had 6-10 years of experience, 15% had 11-15 years of
experience, and 1.7% had more than 15 years. The results are as shown in Figure 4.4 below.

140
120
100
80
60
40
20
0
Less than 1
1-5 years 6-10 years 11-15 years Above 15 years
year
Frequency 15 125 110 45 5
Percent 5 41.7 36.7 15 1.7

Figure 4.4: Number of Years Worked in this Financial Institution

58
4.2.6 Institution

Out of 300 respondents, 35% had worked for the Cooperative Bank, 31.7% had worked for
the Bank of Africa, and 33.3% had worked for the National Bank of Kenya as shown in
Figure 4.5 below.

National Bank of Kenya

Cooperative Bank

Bank of Africa

0 20 40 60 80 100 120
Bank of Africa Cooperative Bank National Bank of Kenya
Percent 31.7 35 33.3
Frequency 95 105 100

Figure 4.5: Institution

4.3 Effects of Job Stress on Mental and Physical Health of Employees in Commercial
Banks
4.3.1 Mental Health

With regard to mental health, this research investigated the hypothesis that supervisors
played a direct role in the professional development and advancement of an employee. When
this hypothesis was posed to the respondents, 5% listed that they “disagree” or “strongly
disagree”, 23.3% listed that they “neutral” and 71.7% listed that they “agree” or “strongly
agree”.

The research also investigated the hypothesis that the relationship between employees and
their co-workers affected employee performance. The respondents were either neutral or
agreed with this hypothesis. None of them disagreed with this opinion. Specifically, as
shown in Table 4.2, below, 13.6% listed that they were “neutral” while 86.4% listed that they
“agree” and “strongly agree” with the hypothesis.
59
The research also investigated the hypothesis that employees were usually not forced to
choose between job and family obligations. The results, as shown in Table 4.2, below
showed that 25% of the respondents “strongly disagree”, 25% are “neutral”, and 50% “agree”
and “strongly agree” with this hypothesis.

The research also investigated the hypothesis that employees do not have enough breaks to
relax between works. The respondents answers to this hypothesis was that 28.8% “disagree”
and “strongly disagree”, 28.8% are “neutral”, and 42.4% “agree” and “strongly agree”, as
shown in Table 4.2, below.

The research also investigated the hypothesis that employees are given unrealistic targets to
achieve. 20% of the respondents disagreed and strongly disagreed with the hypothesis, 21.7%
were neutral, and 58.3% of the respondents agreed and strongly agreed as shown in Table
4.2, below.

The research also investigated the hypothesis that employees were constantly expected to
perform well at work. In responding to this hypothesis, 5% of the respondents disagreed and
strongly disagreed, 5% were neutral, and 90% agreed and strongly agreed as shown in Table
4.2, below.

The research further investigated the hypothesis that employees lacked sufficient time to
complete their work. 18.6% of the respondents disagreed and strongly disagreed with this
hypothesis, 37.3% were neutral, and 44% agreed and strongly agreed as shown in Table 4.2,
below.

60
Table 4.2: Mental Health
Strongly Disagree Neutral Agree Strongly
disagree Agree

My supervisor plays a 0.0% 5.0% 23.3% 45.0% 26.7%

direct role in my
professional development
and advancement
The relationship between 0.0% 0.0% 13.6% 59.3% 27.1%
my co-workers and I
affect my performance
I am not forced to choose 8.3% 16.7% 25.0% 33.3% 16.7%
between job and family
obligations
I don't have enough 8.5% 20.3% 28.8% 27.1% 15.3%
breaks to relax between
work
I am given unrealistic 5.0% 15.0% 21.7% 25.0% 33.3%
targets to achieve
I am constantly expected 1.7% 3.3% 5.0% 43.3% 46.7%
to perform well at work
I don’t have sufficient 1.7% 16.9% 37.3% 27.1% 16.9%
time to complete my
work

4.3.2 Stress

With regard to stress, this research investigated the hypothesis that employees had huge
workload with unrealistic deadlines. To this, 28.4% of the respondents listed that they
“disagree” and “strongly disagree”, 21.7% were “neutral”, and 50% listed that they “agree”
and “strongly agree” as shown in Table 4.3, below.

The research also investigated the hypothesis that employees had time for their family and to
attend their children's playdates. In this, 33.3% of the respondents “disagree” and “strongly
disagree”, 26.7% are “neutral”, and 40% “agree” and “strongly agree” with this hypothesis as
shown in Table 4.3, below.

The research also investigated the hypothesis that team members made the same effort as
employees do in their work. In responding to this hypothesis, the respondents listed their

61
answers as follows: 38.4% “disagree” and “strongly disagree”, 28.3% are “neutral”, and
33.4% “agree” and “strongly agree” as shown in Table 4.3, below.

The research also investigated the hypothesis that employers adhered to the duties that
employees were supposed to perform on the contract they signed. 25% of the respondents
“disagree” and “strongly disagree” with this hypothesis, 31.7% are “neutral”, and 43.3%
“agree” and “strongly agree” as shown in Table 4.3, below.

The research also investigated the hypothesis that employees were given realistic goals that
were achievable to benefit the business. In this, 44% of the respondents “disagree” and
“strongly disagree”, 20.3% are “neutral”, and 33.9% “agree” and “strongly agree” as shown
in Table 4.3, below.

The research further investigated that organizations had automated business systems.18.3%
of the respondents disagreed and strongly disagreed with this hypothesis, 23.3% were
neutral, and 58.3% of the respondents agreed and strongly agreed as shown in Table 4.3,
below.

Table 4.3: Stress

Strongly Strongly
Disagree Neutral Agree
disagree Agree
I have a huge workload with
1.7% 26.7% 21.7% 30.0% 20.0%
unrealistic deadlines
I have time for my family and to
10.0% 23.3% 26.7% 26.7% 13.3%
attend my children's play dates
My team members contribute the
16.7% 21.7% 28.3% 21.7% 11.7%
same as I do in the work, we do
My employer adheres to the duties I
am supposed to perform on the 13.3% 11.7% 31.7% 25.0% 18.3%
contract I signed
I am given realistic goals achievable
18.6% 25.4% 20.3% 27.1% 6.8%
to benefit the business
We have automated business
8.3% 10.0% 23.3% 45.0% 13.3%
systems

62
4.3.3 Physical Health

With regard to physical health, this research investigated the hypothesis that employees got
summoned back usually when they go on leave. The respondents responded to this
hypothesis as follows: 61.7% “disagree” and “strongly disagree”, 25% are “neutral”, and
13.3% “agree” and “strongly agree” as shown in Table 4.4, below.

The research also investigated the hypothesis that employers value employees’ opinions on
matters that concerned the business. To this, 25% of the respondents “disagree” and “strongly
disagree”, 38.3% are “neutral”, and 36.6% “agreed” and “strongly agreed” as shown in Table
4.4, below.

The research also investigated the hypothesis that human resource management ensured that
everyone in the office went on leave. 18.3% of the respondents disagreed and strongly
disagreed with this hypothesis, 21.7% were neutral, and 60% agreed and strongly agreed as
shown in Table 4.4, below.

The research further investigated the hypothesis that burnout negatively affected employee
productivity in the workplace. In responding to this hypothesis, the respondents answered as
follows: 5% “disagree” and “strongly disagree”, 5% are “neutral”, and 90% “agree” and
“strongly agree” as shown in Table 4.4, below.

Table 4.4: Physical Health

Strongly Strongly
Disagree Neutral Agree
disagree Agree
I get summoned back to work when
26.7% 35.0% 25.0% 10.0% 3.3%
am on leave
My employer values my opinion on
11.7% 13.3% 38.3% 33.3% 3.3%
matters that concern the business.
Human resource management
ensures that everyone in the office 8.3% 10.0% 21.7% 35.0% 25.0%
goes on leave.
Burnout has a negative effect on my
3.3% 1.7% 5.0% 30.0% 60.0%
productivity in the workplace.

63
4.3.4 Correlation between Health and Stress

A Pearson correlation test was done to investigate the correlation between Stress and Health
in relation to mental and physical health. The results showed there was no significant
correlation between stress and health at (p=0.658, r=-0.060) for mental health, and at
(p=0.108, r=0.211) for physical health as shown in Table 4.5, below.

Table 4.5: Correlation between Health and Stress

Stress
Pearson Correlation -.060
Mental Health Sig. (2-tailed) .658
N 259
Pearson Correlation .211
Physical Health Sig. (2-tailed) .108
N 259

4.4 Effects of Absenteeism on the Performance of Employees in Commercial Banks

4.4.1 Absenteeism

With regard to absenteeism, this research investigated the hypothesis that work-life
imbalance directly affected employees’ productivity. Respondents answered as follows: 1.7%
“disagree” and “strongly disagree”, 8.3% are “neutral”, and 90% “agree” and “strongly
agree” as shown in Table 4.6, below.

The research also investigated the hypothesis that employers helped employees to find an
ideal balance between work and life responsibilities. To this hypothesis, 41.7% of the
respondents “disagree” and “strongly disagree”, 33.3% are “neutral”, and 25% “agree” and
“strongly agree” as shown in Table 4.6, below.

The research also investigated the hypothesis that employers provided their employees with a
family-friendly workplace. The respondents answered as follows 38.4% “disagree” and
“strongly disagree”, 33.3% are “neutral”, and 28.3% “agree” and “strongly agree” as shown
in Table 4.6, below.

64
The research further investigated the hypothesis that employees could balance their work and
their personal life. As shown in Table 4.6, below, 23.3% of the respondents “disagree” and
“strongly disagree” with this hypothesis, 31.7% are “neutral”, and 45% “agreed” and
“strongly agree”.

Table 4.6: Absenteeism

Strongly Disagree Neutral Agree Strongly
disagree Agree

Work-life imbalance 1.7 % 0.0% 8.3% 56.7% 33.3%

directly affects my
productivity

My employer helps me to 11.7% 30.0% 33.3% 18.3% 6.7%

find an ideal balance
between work and life
responsibilities

My employer provides a 11.7% 26.7% 33.3% 23.3% 5.0%

family-friendly
workplace

I can balance my work 8.3% 15.0% 31.7% 35.0% 10.0%

and my personal life

4.4.2. Leadership Styles

With regard to leadership styles, this research investigated the hypothesis that unfair salary
increment demotivated employees. Respondents answered as follows: 6.7% “disagree” and
“strongly disagree”, 15% are “neutral”, and 78.4% “agree” and “strongly agree” as shown in
Table 4.7, below.

The research also investigated the hypothesis that employees took leave as a way of getting
away from their job. In this, 26.7% of the respondents “disagree” and “strongly disagree”,
31.7% are “neutral”, and 41.6% “agree” and “strongly agree” as shown in Table 4.7, below.

The research also investigated the hypothesis that employees were given equal opportunities
to go on leave. The respondents answered as follows: 20% “disagree” and “strongly
disagree”, 18.3% are “neutral”, and 61.6% “agree” and “strongly agree” as shown in Table
4.7, below.
65
The research also investigated the hypothesis that the leadership in the organization promoted
team morale and built organizational commitments. The respondents answered as follows:
26.7% “disagree” and “strongly disagree”, 31.7% are “neutral”, and 41.7% “agree” and
“strongly agree” as shown in Table 4.7, below.

The research also investigated the hypothesis that the leaders in the organization view
mistakes as an opportunity for employees to learn what motivated them. In this, 40% of the
respondents “disagree” and “strongly disagree” with this hypothesis, 28.3% are “neutral”,
and 31.7% “agree” and “strongly agree” as shown in Table 4.7, below.

The research further investigated the hypothesis that the leaders ensured that everyone in the
workplace knew the procedure for applying for leave.11.6% of the respondents disagreed and
strongly disagreed with this hypothesis, 20% were neutral, and 68.3% agreed and strongly
agreed as shown in Table 4.7, below.

Table 4.7: Leadership Styles

Strongly Disagree Neutral Agree Strongly
disagree Agree

Unfair salary increment 5.0% 15.0% 31.7% 46.7%

1.7%
demotivates me to work
I take leave as a way of
getting away from my job 11.7% 15.0% 31.7% 33.3% 8.3%
All employees are given
equal opportunities to go on 3.3% 16.7% 18.3% 43.3% 18.3%
leave
The leadership in my
organization promotes team 6.7% 20.0% 31.7% 31.7% 10.0%
morale and builds
organizational commitments
Leaders at my institution
view mistakes as an 18.3% 21.7% 28.3% 21.7% 10.0%
opportunity for employees to
learn what motivates them
Leaders ensure that
everyone in the workplace 3.3% 8.3% 20.0% 45.0% 23.3%
knows the procedure for
applying for leave.

66
4.4.3. Job Satisfaction

With regard to job satisfaction, this research investigated the hypothesis that employees were
satisfied with the work they did at their job. The respondents answered as follows: 21.7%
“disagree” and “strongly disagree”, 30% are “neutral”, and 48.3% “agree” and “strongly
agree” as shown in Table 4.8, below.

The research also investigated the hypothesis that the process of remuneration at the
workplace was the same across the board. In this, 46.7% of the respondents “disagree” and
“strongly disagree”, 23.3% are “neutral”, and 30% “agree” and “strongly agree” as shown in
Table 4.8, below.

The research also investigated the hypothesis that employees spent their free time looking for
a new job. 25.4% of the respondents “disagree” and “strongly disagree” with this hypothesis,
40.7% are “neutral”, and 33.9% “agree” and “strongly agree” as shown in Table 4.8, below.

The research further investigated the hypothesis that employees took leave because they felt
frustrated with their work. 36.9% of the respondents “disagree” and “strongly disagree” with
this hypothesis, 31.7% are “neutral”, and 31.6% “agree” and “strongly agree” as shown in
Table 4.8, below.

Table 4.8: Job Satisfaction

Strongly Disagree Neutral Agree Strongly
disagree Agree
I am satisfied with the work
I do at my job 5.0% 16.7% 30.0% 33.3% 15.0%
The process of
remuneration is the same 30.0% 16.7% 23.3% 20.0% 10.0%
across the board
I spend my free time
looking for a new job 8.5% 16.9% 40.7% 20.3% 13.6%
I take leave because I feel
frustrated with my work 18.3% 18.3% 31.7% 23.3% 8.3%

67
4.4.4 Correlation between Employees Performance and Absenteeism

A Pearson correlation test was done to investigate the correlation between absenteeism and
employee performance. The results showed that there was a strong negative significant
correlation between absenteeism and employee performance at (p=0.000, r=-0.557) as shown
in Table 4.9, below.

Table 4.9: Correlation between Employees Performance and Absenteeism

Absenteeism Employee
Performance
Absenteeism Pearson Correlation 1 -.557**
Sig. (2-tailed) .000
N 300 300
Employee Pearson Correlation .557** 1
Performance
Sig. (2-tailed) .000
N 300 300
**. Correlation is significant at the 0.01 level (2-tailed).

4.4.5 Regression Analysis between Employees Performance and Absenteeism.

A regression analysis was done to investigate the extent to which absenteeism affected
employee performance. The model summary Table 4.10 showed that R= -0.557, meaning the
correlation between the two variables was negative and strong, while R Square= 0.310,
indicating that Absenteeism affected 31% of employee performance.

Table 4.10: Model Summary

Adjusted R Std. Error of the

Model R R Square Square Estimate
1 -.557a .310 .298 .72442
a. Predictors: (Constant), Absenteeism
The ANOVA Table 4.11 showed that the regression model is linear at (F=25.602, P=0.00).
The significant model is Y=B0 +B1X1. Where Y= Employee Performance, X= Absenteeism,
B0= Constant, B1= Effect of Absenteeism on Employee Performance.

68
Table 4.11: ANOVA

Model Sum of df Mean F Sig.

Squares Square
1 Regression 13.436 1 13.436 25.602 .000b
Residual 29.913 57 .525
Total 43.348 58

a. Dependent Variable: Performance

b. Predictors: (Constant), Absenteeism

The Coefficients Table shows that the model Y=B0 +B1X1 is Y= 0.718 - 0.720X1.

This indicated that by increasing absenteeism by one unit, employee performance

decreased by 0.720 units,

Table 4.12: Coefficients

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) .718 .475 1.511 .136
Absenteei
-.720 .142 .557 5.060 .000
sm
a. Dependent Variable: Performance

4.5. Effects of Depression Stigmatization on the Performance of the Employees

in Commercial Banks.
4.5.1 Motivation

With regard to motivation, this research investigated the hypothesis that organizational policies
motivated employees to perform their daily duties. The respondents answered as follows:

69
18.6% “disagree” and “strongly disagree”, 47.5% are “neutral”, and 33.9% “agree” and
“strongly agree” as shown in Table 4.13, below.

The research also investigated the hypothesis that employees received recognition and
compensation for a job well done. In this, 41.7% of the respondents “disagree” and “strongly
disagree” with this hypothesis, 25% are “neutral”, and 33.4% “agree” and “strongly agree” as
shown in Table 4.13, below.

The research further investigated the hypothesis that employers made employees feel like an
important part of the company. 33.3% of the respondents “disagree” and “strongly disagree”
with this hypothesis, 35% are “neutral”, and 31.7% “agree” and “strongly agree” as shown in
Table 4.13, below.

Table 4.13: Motivation

Strongly Disagree Neutral Agree Strongly
disagree Agree
Organizational
policies motivate me 1.7% 16.9% 47.5% 18.6% 15.3%
to perform my daily
duties
I receive recognition
and compensation 10.0% 31.7% 25.0% 26.7% 6.7%
for
a job well done
My employer makes
me feel like an 3.3% 30.0% 35.0% 25.0% 6.7%
important part of the
company

4.5.2 Employee Turnover

With regard to employee turnover, this research investigated the hypothesis that
stigmatization in the company affected employee productivity. The respondents answered as
follows: 8.3%
70
“disagree” and “strongly disagree”, 31.7% are “neutral”, and 60% “agree” and “strongly
agree” as shown in Table 4.14, below.

The research also investigated the opinion that inflexible working hours directly affected
employee turnover decisions. In this, 6.7% of the respondents “disagree” and “strongly
disagree” with this hypothesis, 28.3% are “neutral”, and 65% “agreed” and “strongly agree”
as shown in Table 4.14, below.

The research further investigated the hypothesis that conflict with an immediate supervisor
affected an employee’s decision to stay with the company. 23.4% of the respondents
“disagree” and “strongly disagree” with this hypothesis, 11.7% are “neutral”, and 65%
“agree” and “strongly agree” as shown in Table 4.14, below.

Table 4.14: Employee Turnover

Strongly Disagree Neutral Agree Strongly
disagree Agree
Stigmatization in
the company 0.0% 8.3% 31.7% 28.3% 31.7%
affects the
productivity of my
work
Inflexible working
hours directly 1.7% 5.0% 28.3% 35.0% 30.0%
affect my turnover
decision
Conflict with
immediate 6.7% 16.7% 11.7% 38.3% 26.7%
supervisor affects
your decision to
stay in the
company

4.5.3 : Training and Development

With regard to training and development, this research investigated the hypothesis that
training was beneficial for employees’ work accomplishment. The respondents answered as
follows: 0% “disagree” and “strongly disagree”, 16.9% are “neutral”, and 83.1% “agree” and
“strongly agree” as shown in Table 4.15, below.

71
The research also investigated the hypothesis that employees felt discriminated against in
their organization. 36.7% of the respondents “disagree” and “strongly disagree” with this
hypothesis, 51.7% are “neutral”, and 11.7% “agreed” and “strongly agree” as shown in Table
4.15, below.

The research also investigated the hypothesis that training on how to identify and treat people
with mental illness needed be provided. In this, 5% of the respondents “disagree” and
“strongly disagree”, 10% are “neutral”, and 85% “agree” and “strongly agree” as shown in
Table 4.15, below.

The research also investigated the opinion that there was need to have a clear procedures on
how employees reported depression. 5% of the respondents “disagree” and “strongly
disagree” with this hypothesis, 6.7% are “neutral”, and 88.4% “agree” and “strongly agree”
as shown in Table 4.15, below.

The research further investigated the opinion that awareness of mental health in the company
needed to be given priority. In responding to this, the respondents answered as follows: 5%
“disagree” and “strongly disagree”, 1.7% are “neutral”, and 93.3% “agree” and “strongly
agree” as shown in Table 4.15, below.

Table 4.15: Training and Development

Strongly Disagree Neutral Agree Strongly
disagree Agree
Training is beneficial for my
work accomplishment 0.0% 0.0% 16.9% 39.0% 44.1%
I feel discriminated upon in my
organization 11.7% 25.0% 51.7% 10.0% 1.7%
Training on how to identify and
treat people with mental illness 0.0% 5.0% 10.0% 28.3% 56.7%
should be provided
There should be a clear procedure
on how employees report 3.3% 1.7% 6.7% 26.7% 61.7%
depression
Awareness of mental health in the
company should be given priority 0.0% 5.0% 1.7% 28.3% 65.0%

72
4.5.4 Correlation between Depression Stigmatization and Performance of the
Employees in Commercial Banks.

A Pearson correlation test was done to investigate the correlation between Performance and
Stigmatization in relation to performance. The results showed there was a negative
correlation between Performance and Stigmatization at (p=0.341, r=-0.126) as shown in
Table 4.16, below.

Table 4.16: Correlation between Depression Stigmatization and Performance of the

Employees in Commercial Banks.

Performance Stigmatization
Performance Pearson Correlation 1 .126
Sig. (2-tailed) .341
N 300 300
Stigmatization Pearson Correlation .126 1
Sig. (2-tailed) .341
N 259 300

4.6 Chapter Summary

The chapter presented the results of major findings from the research based on three research
questions: the effects of work-related stress on the mental and physical health of employees
in Commercial Banks, the effect of absenteeism on the performance of employees in
Commercial Banks, and the effect of depression stigmatization on the performance of the
employees in Commercial Banks. The next chapter discusses the effects of job stress on the
mental health of employees in Commercial Bank, the effect of absenteeism on the
performance of employees in Commercial Banks, and the effect of depression and
stigmatization on the performance of the employees in Commercial Banks. It also presents a
conclusion of the analyses and offers recommendations.

73
 CHAPTER FIVE

5.0 DISCUSSION, CONCLUSION, AND RECOMMENDATIONS

5.1 Introduction
This chapter presented the discussions, conclusion and recommendations of the study per the
research questions and the data analyzed in chapter four. This study analyzed the effects of
mental health on the productivity of employees within financial institutions. This chapter
consists of the summary, discussions, conclusions, recommendations and suggestions for
further research targeted at means of improving the productivity of the employees in financial
institutions.
5.2 Summary
The study examined the effects of mental health on the productivity of employees within
financial institutions: A case study of Commercial Banks. The following were the research
questions: (1) How does work-related stress affect the physical and mental health of
employees in commercial banks? (2) What are the effects of absenteeism on the performance
of employees in commercial banks? (3) What are the effects of depression and stigmatization
on the performance of employees in commercial banks?

A descriptive research design was adopted in conducting this study and analyzing the
research questions. The study population consisted of a total of 800 employees from
Cooperative Banks, Bank of Africa and National Bank of Kenya, however, only 300 out of a
sample of 384 responded resulting in a 78% response rate. The collected data was analyzed
using descriptive statistics as well as correlation and regression analysis. Descriptive
statistics was used to describe and summarize the data, whereas correlation and regression
analysis was applied to determine the relationship between the dependent and independent
variables. The dependent variable included the rewards, the performance of the employees
whereas the independent variable was the implications on employee mental health.

On the first research question determining how work-related stress affected the physical
health and the mental health of the employees in commercial banks, the findings showed that
employee burnout negatively affected their performance in the workplace by 90%. Being
given
74
unrealistic deadlines to meet their target by the employer affected their performance by 50%
while being summoned back to work affected their performance by only 13.3%. A
correlation test results indicated that there was no significant relationship between stress and
health at (p=0.658, r=-0.060) for mental health and at (p=0.108, r=0.211) for physical health.
This meant that there was no linear relationship between stress and health that affected the
productivity of employees in financial institutions.

On the second research question determining the effects of absenteeism on the performance
of employees in commercial banks, the findings showed that work-life imbalance affected
their performance by 90% and 30% of the employees agree that the remuneration process in
the workplace needed to be the same across board. A correlation test result indicated that
there was a strong negative significant relationship between absenteeism and employee
performance (p=0.000, r=-0.557). The regression analysis further indicated that absenteeism
affected employee performance, the results achieved were R + -0.557. This meant that the
correlation between the two variables was negative and strong, while R2= 0.310 indicated that
absenteeism affected 31% of employees’ performance. The Anova test also indicated that
increased absenteeism by one unit, resulted in a decreased employee performance by 0.720
units.

On the third research question determining the effect of depression and stigmatization on the
performance of the employees in commercial banks, the findings showed 88.4% agreed that
the procedure on how to report depression need to be clear. A correlation test result indicated
that there was a negative relationship between depression and employee performance at
(p=0.341, r=-0.126). This was confirmed by regression analysis which decreased the
employee performance by 1.5%.

5.3 Discussion
5.3.1 Effects of Job Stress on the Mental Health of Employees in Commercial Bank

This study’s first research question sought to establish the effect of job stress on the mental
health of employees in commercial banks. The research through correlation and regression
analysis indicated that there was no significant relationship between stress and the health of

75
the employee. This contradicts the findings by Bashir and Ramay (2010), who conducted a

76
study in Pakistan using 144 employees to determine the impact of job stress on their
performance. They stated that bankers were under great pressure due to work overload,
ambiguity in their roles, lack of feedback and keeping up with the rapid technological change
in the area of business. The results of the study showed a significant negative correlation
between job stress and job performance. Meaning that the employee’s performance
significantly reduced due to job stress.

This contradicts the findings by Petarli et al. (2015) who analyzed the relationship between
stress and health of the employees of the banker who worked in Brazil. The study noted that
occupational stress resulted in the mental health of the employees that affected the
productivity within the organization. Their study stated that the employees that had worked
in the Espirito Santo in Brazil for 5 years, had low education levels, low support and the
employees who were married were more prone to stress that the other employees in the bank.

The findings of this study on the relationship between health and stress also contradicts the
finding by Mxenge et al. (2014), who stated that organizational stress among employees
negatively affected the productivity and the performance of the employees within the
workplace. This was after a study done among support personnel at the University of Fort
Hare in the Eastern Cape. The study indicated a strong correlation between organizational
stress and the employee's intention to quit and that this affected the employee performance in
the organization.

The findings of this study on the relationship between health and stress also contradicts the
findings by Amigo et al. (2014) who surveyed the employees at the Spanish Savings Bank
that stated that the employees at the branch level were more affected than the employees who
worked at the head office. This was because they were the people who had contact with the
clients. The stress experience from the employer's expectation and the client demands
affected their productivity levels. According to Mitsvunguma and Gwandure (2011),
occupational stress played a major role to ensure employee burnout. The burnout caused the
employees to be less effective and efficient in their work which in turn reduced their
performance.

77
The findings of the study on the relationship between health and stress contradicts the study
of about 50 employees that was done in South Africa, in the banking sector. The study
compared the psychological well-being of employees who actively handled cash and the once
that didn’t handle cash. The results showed that the employees had major burnout, work
stress and emotional exhaustion. The work stress affected employee performance and
productivity in the bank. This also led to the employees being demotivated to work
(Mutsvunguna & Gwandure, 2011).

Devi and Sharma (2013) also did a random sample of 501 employees to examine how job
stress affected the employees in India. It was noted that some of the employees lacked the
skills to perform their duties while others were loaded with work and this led to them getting
stressed. The banking job being a routine work and the monotony led some employees to
compromise on the quality of the work they did to make time for their families. This affected
employee performance in the organization.

5.3.2 Effect of Absenteeism on the Performance of Employees in Commercial Banks

This research through correlation and regression analysis indicated that there was a strong
negative correlation between absenteeism and employee performance. It indicated that
absenteeism affected 31% of the employee performance in the organization. The strong
negative correlation between absenteeism and employee performance in this study is in line
with the findings of Mukururi and Ngari (2014) who stated that work-life balance increased
the efficiency of the employees in the workplace which in turn increased the employee’s
performance. Research done by WHO (2014) stated that employees that are well- balanced
were mentally healthier. This made them better employees to increase their performance as
opposed to those that are not well balanced.

Macais (2014) researched the bank of Accra in Ghana where it was noted that work-life
balance had a great impact on the employees. Most of the employees in the bank were given
limited time for social responsibilities because of the targets they had at work. He suggested
that there was need for the employees to be trained on time management and the employer to
give realistic goals.

78
The findings on the study on the relationship between absenteeism and employee
performance is in line with a survey done by 94,000 employees in the Gallup-Healthways
Well-Being Index. The study noted that the annual cost of absenteeism varies from industry
to industry, however, it had more effect in professional occupations (Folger, 2017).
According to Forbes (2013), absenteeism could cost the company close to $3,600 per year for
every employee working hourly and $2,650 for salaried employees within the organization.
Excessive absenteeism among employees with the organization decreased productivity and
had a major effect on the finances and morale of the employee in the organization.

According to Tiwari (2014), the impact of absenteeism within the organization appeared to
be average. His findings stated that absenteeism caused the employee’s level of satisfaction
to decrease which affected the performance of the employee within the organization. It was
noted that absenteeism significantly affected the corporate performance since it reduced the
level of organization productivity, profitability and quality of the service or product produced
by the employees as well as the promptness of meeting the demand of the customer. This was
a survey done in Cadbury Nigeria Plc, Ikeja.

The findings on the study on the relationship between absenteeism and employee
performance is in line with a study done in Bangladesh. The study was to examine the reason
why there was too much absenteeism of employees in the private commercial bank. The
sample was carried among 80 respondents. Shivam and Vijay (2013), stated that absenteeism
affected the cost of labor which increased, reduced productivity and potentially led to
increased indiscipline within the organization. The more the number of employees that were
absent at work the lower the morale of the employees. They suggested that the human
resource management needed to look for ways that ensured that the employees were
motivated as this increased the productivity of the employees in the organization since the
employees would have a healthy environment that helped them focus on the objectives of the
organization.

5.3.3 Effect of Depression and Stigmatization on the Performance of the Employees in

Commercial Banks
The research findings showed a negative correlation between performance and
stigmatization. This is line with the finding by Silva and Barreto (2010) on work-related
79
stress and how it’s

80
connected to the negative outcome in both physical and mental health which included
depression, anxiety, drinking and smoking by the employees. The study was meant to help
prevalent minor psychiatric disorders especially in the large bank in Brazil. They did a
random sample of 2,054 bank employees in Brazil. The findings showed that employees that
had high targets and low control over what affected the business were more affected and their
performance reduced immensely. They were more prone to stress which led to them to be
depressed and this affected their performance within the organization.

The findings of the study on the relationship between depression and performance is in line
with the motivational theories that could be used to motivate the employees to increase their
performance within the organization. This was the theory by Fredrick Herzberg and Victor
Vroom. Herzberg stated that the employees’ performance was better when they were
motivated. Vroom talked about the expectancy theory where the employee believed that
increased effort on their part led to increased performance but needed to have the right
resources, the right skills and the necessary support to get the job done (Hur, 2018). On the
other hand, Herzberg also stated that motivation was key to ensure the employee
performance was increased using the two-factor theory. He believed that hygiene in the
workplace encouraged the employee to work hard but lack of it demotivated the employee.

The findings of the study on the relationship between depression and performance is in line
with Cherry (2015) findings on Maslow's hierarchy of needs. This stated that the employees
needed to meet their need in order starting from physiological needs, safety need, love and
belonging, esteem and self- actualization. The lower needs had to be satisfied first before the
individual could move to the next need. The meant that the employees had to fulfill their
basic needs before they could move to the next level in the hierarchy. This lowered the rate at
which the employees got depressed and increased their performance in the workplace.

The findings of the study is in line with the research done in Nigeria on the employees in the
banking sector. It was noted that most employees fell into depression because of the
unrealistic goals that they were given by their employers, unrealistic policies in the
workplace, the working environment and job security. The pressure they got was more than
the remuneration
81
they received for the work they did in the organization and the working environment was
also not conducive. This led to a decreased productivity within the organization (Oginni et al.
2013). According to Preshita and Pramod (2014), many bankers fell into depression because
of the pressure they got from the employers.

The finding of the study is in line with the research by Arboleda-Flórez and Stuart (2012), on
the study they did on fighting the stigmatization of mental health. They stated that stigma
belittled the value of individuals suffering from mental health. When the employees fell into
depression and ended up being stigmatized, their productivity was lowered since they felt
like they do not belong and no one understood them. Offering support and understanding
them could make the stigmatized employee gain their strength to overcome the disorder
which in turn improved their performance in the organization.

5.4 Conclusions
5.4.1 Effects of Job Stress on the Mental Health of Employees in Commercial Bank

The findings in this study indicated that there was no significant correlation between stress
and health. The regressions analysis also indicated that there was no significant effect
between stress and health. The study, therefore, concluded that stress does not significantly
affect the productivity of the employees in financial institutions.

5.4.2 Effect of Absenteeism on the Performance of Employees in Commercial Banks

The findings in this study indicated that there was a strong negative significant correlation
between absenteeism and employee performance. The regression analysis also indicated that
there was a strong negative effect between absenteeism and employee performance. It
indicated that by increasing absenteeism by one unit, employee performance decreased by
0.720 units. The study, therefore, concluded that absenteeism significantly affected the
performance of the employees.

82
5.4.3 Effect of Depression and Stigmatization on the Performance of the Employees in
Commercial Banks

The findings in this study indicated that there was a weak negative correlation between
performance and stigmatization. The regression analysis also indicated that stigmatization
and depression affected employee performance by 1.5%. The study, therefore, concluded that
depression and stigmatization significantly affected the performance of employees.

5.5 Recommendations
5.5.1 Recommendation for Improvement

5.5.1.1 Effects of Job Stress on the Mental Health of Employees in Commercial Bank

The study findings showed that there was no significant effect on stress and health. However,
other studies indicated that there were significant effect of stress on employee performance.
The study, therefore, recommends that the institutions trust their employees with only
realistic targets whilst affording them ample time to achieve those targets. This would help in
addressing problems associated with burnout. Additionally, this helped in measuring
employee productivity. Managers and other team players needed to support other employees
and consider their opinion and suggestions. This was informed by the reality that the
employees are closest to the work chain and other work processes on the ground, and could,
therefore, identify possible areas of deficiency.

5.5.1.2 Effect of Absenteeism on the Performance of Employees in Commercial Banks

The study findings showed that there was a negative significant relationship between
absenteeism and employee performance meaning that an increased absenteeism led to a
decreased employee performance in financial institutions. The study, therefore, recommends
that for financial institutions to benefits from increased productivity, employees needed to be
provided with a conducive work environment. There was need for fair remuneration, well-
coordinated training as well as a balanced work-life experience. Maintenance of a stable
work- life equilibrium assisted employees to rest and rejuvenates their creativity. This
translated to productivity for the organization.

83
5.5.1.3 Effect of Depression and Stigmatization on the Performance of the Employees in
Commercial Banks

The study findings showed that there was a negative relationship between performance and
stigmatization meaning that an increased rate of stigmatization led to a decreased employee
performance in financial institutions. The study, therefore, recommends that employers
needed to treat their employees as the most important asset. This included a deliberate
dedication to addressing mental health concerns of their employees. Measures such as
building and facilitating centers for reporting and treating mental health were necessary and
encouraged. There was need for the provision and facilitation of a competent therapy and
psychiatric clinic as well as an equally competent medical cover to cater to employees’
mental health needs. Moreover, employees had to be allowed to discuss mental health
concerns with professionals and other stakeholders without fear of discrimination and
stigmatization. This would encourage many employees who were suffering in silence to seek
much-needed help.

5.5.2 Recommendation for Further Research

This study focused on the effects of mental health on the productivity of employees in
financial institutions. It, however, only focused on mental health, absenteeism, depression,
and stigmatizations within the institutions. There was need to undertake further research in
other organizations to identify other factors that affected the productivity of the employees.
Therefore, the study recommends the need for further research on other far-reaching effects
of mental health disorders on employees. This should include a multi-disciplinary study of
how mental health complications emanating from the work environment affect the broader
society.

There was also need for research centers to determine how mental health awareness programs
may form part of new frontiers for corporate social responsibility practices amongst industry
players such as insurance firms and hospitals. The suggested research areas would not only
add to the already existing volume of knowledge but also provide much-needed information
on how to practically handle contemporary health issues related to mental health on a more
than academic basis.

84
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 APPENDICES

APPENDIX I: CONSENT TO PARTICIPATE

Title of Study: Effects of Mental Health on the Productivity of Employees within

Financial Institutions: A Case of Commercial Banks in Kenya.

Investigator:

Name: Ochieng’ Pauline Awuor Student identification: 632798

Phone: 0710364223

Introduction

 You are being asked to take part in a research study to establish the Effects of Mental
Health on the productivity of employees within financial institutions: A case of
Commercial Banks in Kenya.
 You were selected as a possible participant because you are employees of Financial
Institution: Cooperative Bank, Bank of Africa and National Bank of Kenya. We ask that
you read this form and ask any questions that you may have before agreeing to be in the
study.
Purpose of Study

 The purpose of the study is to examine the Effects of Mental Health on the
productivity of employees within financial institutions: A case of Commercial Banks
in Kenya. The research questions will be to determine; How work-related stress affect
the physical and mental health of employees in Commercial banks? To investigate the
effects of absenteeism on the performance of employees in commercial banks and to
investigate the effects of depression and stigmatization on the performance of
employees in commercial banks?

94
 Ultimately, this research project will be submitted to the Chandaria School of Business in
Partial Fulfilment of the Requirement for the Degree of Masters in Business
Administration (MBA).
Description of the Study Procedures

 If you agree to be in this study, you will be asked to complete a written questionnaire.
Confidentiality

 This study is anonymous. We will not be collecting or retaining any information about
your identity.
Right to Refuse or Withdraw

 The decision to participate in this study is entirely up to you. You may refuse to take part
in the study at any time without affecting your relationship with the investigator of this
study. You have the right not to answer any single question, as well as to withdraw
completely from the interview at any point during the process.
Right to Ask Questions and Report Concerns

 You have the right to ask questions about this research study and to have those questions
answered by me before, during or after the research. If you have any further questions
about the study, at any time feel free to contact me, Pauline Awuor at
Paulinemya@gmail.com or by telephone at 0710364223. If you like, a summary of the
results of the study will be sent to you.
Consent

 Your signature below indicates that you have decided to volunteer as a research
participant for this study, and that you have read and understood the information provided
above. You will be given a signed and dated copy of this form to keep, along with any
other printed materials deemed necessary by the study investigator.
Subject’s Name: ……………………………………………. Date:………………….

Subject’s Signature: ………………………………………..

Investigator’s Signature:…………………………………… Date:………………….

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 APPENDIX II: DEBRIEF FORM

Effects of Mental Health on the Productivity of Employees within Financial

Institutions: A Case of Commercial Banks in Kenya.

Thank you for agreeing to participate in this study. The general purpose of this research is to
establish the Effects of Mental Health on the productivity of employees within financial
institutions: A case of Commercial Banks in Kenya.

We requested employees of Cooperative Bank, Bank of Africa and National Bank of Kenya
to participate. In this study, you were asked to complete a questionnaire. The results from this
study will determine; the Effects of Mental Health on the productivity of employees within
financial institutions: A case of Commercial Banks in Kenya.

If you have any concerned please feel free to contact the researcher

Thank you for your participation in this study. If you have further questions about the study,
please contact by phone 0710364223 or email Paulinemya@gmail.com. In addition, if you
have any concerns about any aspect of the study, you may contact me.

I understand that the investigator is willing to answer any inquiries I may have concerning
the research herein described. I understand that I may contact Pauline Awuor through the use
of 0710364223 or email Paulinemya@gmail.com or her faculty advisor Prof. Caren Ouma
0722316109 or couma@usiu.ac.ke. In addition, if you have any concerns about any aspect
of the study, you may contact Dr. Damary Sikalieh Ph.D., Chair, Institutional Review Board
for Management, Business Research Methods and Entrepreneurship, Off USIU Road, Off
Thika Road (Exit 7), P. O. Box 14634 - 00800, Nairobi, Kenya, East Africa. Telephone:
(+254) 730116000.

96
 APPENDIX III: INTRODUCTION LETTER

Dear Respondent,

I am a student at United States International University – Africa pursuing a Master’s Degree

in Business Administration. I am conducting a study on the EFFECTS OF MENTAL
HEALTH ON THE PRODUCTIVITY OF EMPLOYEES WITHIN FINANCIAL
INSTITUTIONS: A CASE OF COMMERCIAL BANKS IN KENYA as part of fulfilling
my MBA program.

I am kindly requesting you to take a few minutes to answer the attached questionnaire. The
data collected will be strictly used for academic and confidentiality shall be observed on the
same.

Your assistance and cooperation will be highly appreciated. Thanks in advance.

Yours Sincerely,

Pauline Awuor.

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 APPENDIX IV: QUESTIONNAIRE

The general objective of this study is to determine the effects of mental health on the
productivity of employees within financial institutions: A case of commercial Banks in
Kenya. You are kindly requested to respond to these questions by ticking on the appropriate
no (✓) or fill the answers in the blank spaces.

SECTION A: DEMOGRAPHIC INFORMATION

1. Gender:
Male: [ ] Female: [ ]

2. Age?
18-25 [ ] 26-30 [ ] 31-35 [ ] 36-40 [ ] 41 and above [ ]

3. Highest Level of education:

Certificate/ Diploma [ ] Degree [ ] Postgraduate [ ]

4. The number of years working in this financial institution?

Less than 1 year [ ] 1-5 years [ ]
6-10 years [ ] 11-15 years [ ] Above 15 years [ ]

5. Which Financial Institution do you work for?

Cooperative Bank [ ]
Bank of Africa [ ] National Bank of Kenya [ ]

98
2.4 SECTION B: Effects of Work-Related Stress on Mental and Physical health of
Employees
Types of flexible working arrangements employed by graduate students

6. What is the major cause of job stress in your workplace?

…………………………………………………………………………………………
…………………………………………………………………………………………
…………………………………………………………………………………………
………………

Indicate the extent to which work-related stress has an on the mental and physical health of
employees in your company (Place a tick in the appropriate square bracket).

Strongly disagree (1) Disagree (2) Neutral (3) Agree (4) Strongly Agree (5)

STATEMENT

Disagree
Disagree
Strongly

Strongly
Neutral

Agree

Agree
Mental Health

7. My supervisor plays a direct role in my

professional development and advancement
8. The relationship between my co-workers and I
affect my performance
9. I am not forced to choose between job and family
obligations
10. I don’t have enough breaks to relax between work
11. I am given unrealistic targets to achieve
12. I am constantly expected to perform well at work
13. I don’t have sufficient time to complete my work
Stress
14. I have a huge workload with unrealistic deadlines

99
 15. I have time for my family and to attend my
children’s play dates
16. My team members contribute the same as I do in
the work, we do
17. My employer adheres to the duties I am supposed
to perform on the contract I signed
18. I am given realistic goals achievable to benefit the
business
19. We have automated business systems

Physical Health
20. I get summoned back to work when am on leave
21. My employer values my opinion on matters that
concern the business
22. The human resource management ensures that
everyone in the office goes on leave
23. Burnout has a negative effect on my productivity
in the workplace

2.5 Section C: Effect of Absenteeism on the Performance of Employees

Please indicate in what ways the work environment affects your productivity in your company?
…………………………………………………………………………………………………
…………………………………………………………………………………………………
…………………………………………………………………………………………………
………………

Indicate the extent to which absenteeism at the workplace affects the performance of
employees in your company (Place a tick in the appropriate square bracket).

Strongly disagree (1) Disagree (2) Neutral (3) Agree (4) Strongly Agree (5)

10
0
 STATEMENT

Disagree
Disagree
Strongly

Strongly
Neutral
Agree

Agree
Absenteeism

24. Work-life imbalance directly affects my productivity

25. My employer helps me to find an ideal balance between

work and life responsibilities

26. My employer provides a family-friendly workplace

27. I can balance my work and my personal life

Leadership Styles

28. Unfair salary increment demotivates me to work.

29. I take leave as a way of getting away from my job

30. All employees have been given equal opportunities to

go
on leave
31. The leadership in my organization promotes team
morale and builds organizational commitments
32. Leaders at my institution view mistakes as an
opportunity for employees to learn what motivates them
33. Leaders ensure that everyone in the workplace knows
the procedure for applying for leave
Job Satisfaction

34. I am satisfied with the work I do at my job

35. The process of remuneration at my workplace is the

same across the board

10
1
 36. I spend my free time looking for a new job

37. I take leave because I feel frustrated with my work

2.6 Section D: Effect of Depression and Stigmatization on the Performance of the

Employees
Please indicate the depression that affects your productivity in the institution.

…………………………………………………………………………………………………
…………………………………………………………………………………………………
…………………………………………………………………

Indicate the extent to which depression stigmatization affects the performance of the
employees in your company (Place a tick in the appropriate square bracket).

Strongly disagree (1) Disagree (2) Neutral (3) Agree (4) Strongly Agree (5)

STATEMENT

Disagree
Strongly

Strongly
disagree

Neutral

Agree

Agree
Motivation

39. Organizational policies motivate me to perform my

daily duties
40. I receive recognition and compensation for a job well
done
41. My Employer makes me feel like an important part
of the company
Employee Turn Over

42. Stigmatization in the company affects the

productivity of my work

10
2
 43. Inflexible working hours directly affect my turnover
decision
44. Conflict with immediate supervisor affects your
decision to stay in the company
Training and Development

45. I feel discriminated upon in my organization

46. Training on how to identify and treat people with

mental illness should be provided
47. There should be a clear procedure on how employees
report depression
48. Awareness of mental health in the company should
be given priority

THANK YOU

10
3
APPENDIX V: INSTITUTIONAL REVIEW BOARD (IRB) LETTER

10
4
APPENDIX VI: NACOSTI PERMIT

10
5
10
6