Determinants of Use of Short Term Contracting of Employees in Institutions of Higher Learning in...

8/10/2019 Determinants of Use of Short Term Contracting of Employees in Institutions of Higher Learning in Kenya. Case Stu

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DETERMINANTS OF USE OF SHORT TERM CONTRACTING OF EMPLOYEES IN

INSTITUTIONS OF HIGHER LEARNING IN KENYA.CASE STUDY OF KABARAK

UNIVERSITY, NAKURU

LUCY WAMBUI MWANGI

JomoKenyatta University of Agriculture and Technology, Nakuru CBD Campus, Nakuru, Kenya

ABSTRACT

All organizations experience annual phases when short term contracting is needed in order to complete a large

project or meet increased labour demands. Bringing new team member is an expensive exercise. This is because of

statutory taxes, benefit costs and personal expenses. Costs of hiring full time employees far exceeds the amount you would

spent bringing in someone on short term. Staff short term contracts are an essential element of an effective human

resources strategy for empowerment and performance. The short term contracting is supposed to be closely aligned with

the type and duration of function performed, easy to administer, fair and transparent. The purpose of this study was to

examine the determinants of use of short term contractual employees by organizations. The unit of study was Kabarak

University, which has a considerable large number of employees on short term contracts, as a case. The main objective of

the study was to analyze the determinants of use of short term contracting of employees. The target population of the study

was 244 from which a sample size of 70 was determined. The research used descriptive technique, specifically case study.

The quantitative approach was used. Data was collected using primary and secondary data collection techniques. Primary

data was gathered through structured questionnaires while the secondary data was gathered using the available records,

policy documents and manuals. The reliability and validity of the instrument was established through a pilot study. Data

was analyzed using statistical package for social science (SPSS) version 20 and Microsoft Office Excel. The data was

presented using percentages and means. To determine if the independent variables influence the dependent variable z-test

was done. The study revealed that cost reduction has a significant influence on use of short term contracting of employees.

The study, therefore, concluded that use of short term contracting of employees is essential for any organization that

wishes to reduce cost with Kabarak University as a reference point. The study therefore recommended that organization

use short term contracting as one of the ways of reducing costs as many temporary employees do not enjoy benefits like

pension benefits, leave allowance, medical insurance, job training and office allocation. The study ended up underscoring

the importance of engaging short term employees to any organization that aspires to reduce its operational costs.

KEYWORDS:Labour Demands, Kabarak University, Employment in Kenya

INTRODUCTION

Background

All organizations experience annual phases when extra help is needed in order to complete a large project or meet

increased service demands. More often than not, a companys solution to a growing workload is to push current staff

harder and compensate them with overtime hours. Considering the time and money it takes to bring on a new team

member, its a commonly held belief that conserving these resources is more beneficial overall. It turns out that the cost of

International Journal of Human Resource

Management and Research (IJHRMR)

ISSN (P): 2249-6874; ISSN (E): 2249-7986Vol. 4, Issue 6, Dec 2014, 17-38

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18 Lucy Wambui Mwangi

Impact Factor (JCC):4.9135 Index Copernicus Value (ICV): 3.0

hiring a skilled temporary employee to help you out during peak times is rarely more than increasing the number of hours

for current staff. Once youve factored in statutory taxes, benefits costs and personnel administration expenses, the cost of

your full-time employees far exceeds the amount youd spend bringing in someone short term (Connely, 2013). The short

term contracts are common in sectors that find it difficult to manage the financial demands of permanent employees due tothe fluctuating demands of work. For example, 48 per cent of staff in the hotel, catering and leisure industries are employed

on zero-hours contracts, along with one-tenth of retail staff. However, it was also reported that one-fifth of County Council

staff are signed onto a zero-hours contract while universities and colleges are twice as likely to employ staff in this way.

(Public Service Commission of Canada, 2010).

The Canada Public Service Commission recognizes the need for temporary help services to meet short-term,

immediate requirements. Managers are often called upon to deliver results immediately and require workers who can

quickly and efficiently fill in during unexpected events, such as sickness, unanticipated workload increases or employee

departures. Temporary help services represent one of several resourcing options available to managers to meet their short-

term operational requirements (Vislykh et al, 2009). Staff short term contracts are in fact an essential element of an

effective human resources strategy for empowerment and performance. They should be closely aligned with the type and

duration of the function performed, easy to administer, fair and transparent. According to Wandera (2011) Among a range

of classifications available, short term employment is variously referred to under the titles contingent, part time,

casual, or atypical employment. Short term employment has increasingly become part of the labor market. In the study

among selected universities Higher education institutions in the East African region, Mageto puts it that universities are

increasingly making use of part-time faculty to help with the teaching of undergraduate and graduate students. In most

cases, the extra income and flexibility of schedule have enticed many experts in their fields to enter the field of higher

education for part-timing (Mageto, 2008).

According to Omolo (2012), analysis of the employment data for Kenya shows, an increasing trend in the

engagement of workers on casual terms of employment. The data shows that the proportion of casual workers in the formal

sector gradually increased from 17.9 percent in 2000 to 21.2 per cent in 2005. The size of employees on casual terms then

increased thereafter to reach an all time high of 32.2 per cent in 2008 before declining marginally to 30.1 per cent in 2010

(Republic of Kenya: Economic Survey, various). Part-time teaching is not necessarily a new phenomenon in higher

education. However, it is new in Kenya out of the recent increment of students seeking degree education. For example, in

Kenya, most private universities tend to utilize more part-time teaching faculty than public universities. As Mwiria et al

(2007) have argued, About half of the teaching staff in the private universities are currently part-timers drawn from the

public universities. With greater competition for the limited pool of academic staff in areas such as the sciences and ICT,

the institutions will have to invest more in staff training if they are to survive. Kenya's 30 universities are being crippled

by an acute shortage of professors, according to the Commission for Higher Education. Universities are increasingly

turning to part-time lecturers, but many have only attained masters degrees. The CHE has said this is unlikely to affect the

quality of learning in Kenya's universities. But employers and educationists are raising a red flag, saying that the level of

qualifications and lack of staff could dilute learning. Global window (2014), continues to put it that while holders of

masters degrees are allowed to lecture under commission regulations, educationists are concerned that lecturers without

PhDs have not been subjected to sufficiently rigorous academic training.


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Determinants of Use of Short Term Contracting of Employees in Institutions 19of Higher Learning in Kenya.Case Study of Kabarak University, Nakuru


Kabarak University is a Christian Private Charted University which was established in 2002. At its inception,

the University had 59 employees. Due to expansion of physical infrastructure, introduction of new programmes and

increase in student enrolment, the number of employees has increased to 198 (58 teaching staff and 140 non-teaching

staff). However, over the last five years, the University has experienced increase in the number of short term contracts.The short term contracts have continually increased year after year from 15 in 2008 to 46 in 2014. The study therefore,

aimed at investigating the determinants for use of short term contracting of employees in Kabarak University. The types of

the short contracts used by Kabarak University include the part time. This particularly applies to the part time teaching

staff. The other area that makes use of the part time employees is the catering department, grounds, farm, and

administration. Cleaning services are outsourced to a cleaning firm on short term contract basis.

STATEMENT OF THE PROBLEM

Despite of the fact that there has been considerable growth in short term employment in organizations across the

globe, the growing body of research remains largely limited to employees (typically referred to as permanent employees)

hired with an expectation, on the part of both employer and employee, of relatively long-term employment. Very little

research links progressive human resource management practices and systems to the management of workers hired on a

short term basis who may not share their more permanent counterparts expectations of relatively longer-term employment.

Part-time teaching and support services is not a new phenomenon in higher education. Many Universities in Kenya are

continuously making use of short term contracts particularly part-time faculty to help with teaching the undergraduate and

graduate students. Studies have been done on the effects of short term contracts on employees performance. However,

little research study has been done on the determinants for use of short term contracting of employees in Institutions of

Higher Learning. This study, therefore, aims at investigating the determinants of use of short term contracting of

employees in Kabarak University.

OBJECTIVES OF THE STUDY

The General objective was to explore the determinants of use of short term contracting of employees in

Institutions of Higher learning.

Specific Objectives

To evaluate the cost reduction strategies that lead to use of short term contracting of employees at Kabarak

University

To analyze whether outsourcing services at Kabarak University influence the use of short term contracting of

employees.

Research Hypotheses

H01:1=; Cost reduction does not significantly lead use of short term contracting of employees in Kabarak

University.

H02:2=;Outsourcing of services at Kabarak University does not significantly influence short term contracting

of employees.


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Justification of the Study

Results of this study will be utilized by Kabarak University Administration and Human Resource Departments to

establish the determinants of use of short term contracts of employees. The study will help employees to understand why

organizations use short term contracts and how it affects or affected them either positively and negatively. Scholars of

Human Resource Management will gain insight into determinants of use of short term contracts and how they affect the

performance of their organizations.

Scope of the Study

The research focused on the determinants of use of short term contracts of employees in Kabarak University.

Kabarak University has 3 branches: Nakuru Main Campus, Nakuru Town Campus and Nairobi Campus. The research

however focused on Nakuru Main Campus. The study was conducted within four months. There were a total of 244

temporary and permanent employees. Participants were selected from both the teaching and non-teaching staff who were

either permanent or temporary. The sample of the study comprised of 70 respondents. The research utilized a budget of

Kshs. 56,000.

Limitations of the Study

Some respondents were reluctant to give confidential information which was vital for the study. The Researcher

assured the employees that the information given would be treated with confidentiality and would not use the information

for other purposes but for the research. Some respondents were slow in filling and returning the questionnaires.

This prompted the researcher to constantly remind them where most of them responded positively while some of them did

not respond at all.

LITERATURE REVIEW

Introduction

This chapter summarizes the information from other researchers who have carried out their research in the same

field of study. The specific areas covered here are: theoretical review, theoretical framework, conceptual review,

conceptual framework, summary of literature review and research gaps of determinants of short term contracting of

employees.

Theoretical Review

Contracting is an agreement specifying terms and conditions under which a person consents to perform certainduties as directed and controlled by an employer in return for an agreed upon wage or salary.

Types of Short Term Contracting

There are different types of contracting. These include the following:

Employment Contract for a Specified Task

This form of employment is most common for seasonal work. The crucial characteristic of an employment

contract for a specified task is the fact that it defines its termination date by specifying the work which is to be performed.

This kind of contract is terminated at the moment when the employee completes assigned work. After an employment

contract for a specified task has been terminated, it is possible to conclude subsequent contracts of the same nature.


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The law does not prohibit such a practice.(Rodger, 2014). Additionally, an employment relationship which arises from this

type of contract expires when the employee has performed all the activities which were supposed to produce a specified

result but the result has not been achieved. In such a case the employee is entitled to remuneration that corresponds to the

amount and quality of the work they performed. If the employee performed work which has not produced the result,their right to remuneration is not revoked (Jones, 3013)

Replacement Employment Contract

According to Jones (2013) a replacement employment contract is a separate type of limited duration contract

which is concluded in the situation in which an employee must be replaced during their excused absence. The period for

which a contract is concluded can be specified by providing an exact date or indicating a future event which is bound to

take place for example expiry of a female employees maternity leave. The essence of this form of employment is the fact

that a replacement employment contract shall concern the same type of work which has been explained in the contract of

the replaced employee. The law does not require, however, that the replacement employees remuneration or amount ofworking time be the same as they are for the replaced employee. It is legal to hire the replacement employee who works

part-time or for a lower remuneration irrespective of working conditions of the replaced employee(Sulej&Wjcik, 2010).

Benefits of Short Term Contracting

The following are some of the benefits that are derived by organizations through the use of short term contracting

of employees:

Cost Cutting

Many companies utilize temporary employees as a cost-saving method, because many employers are not required

to retain the temporary employees indefinitely and inevitably pay employee benefits, such as health insurance, sick days

and retirement benefits. If an individual is hired by a staffing agency to work for a certain company, the staffing agency

usually receives a portion of the employee's compensation or charges the client additional fees. If the employee is hired

permanently by the staffing agency's client, the staffing agency usually requires their client to pay a fee to enable the

staffing agency to terminate the temporary employment contract.

Increased Productivity

A temporary worker is goal oriented and focused on accomplishing a lot in a short time frame. This means far less

idle time on the job. Studies show that the average full-time employee spends as much as 25% of their workday engaged in

non-productive activities. Temporary employees are far less likely to waste time and, as a result, are much more beneficial

to the organization during busier periods.

The Right Skills Set

Consulting with a staffing agency allows an organization to select temporary professionals with the exact skill

set(s) that are needed to accomplish the organizations specific goals. Temporary staffing and recruitment firms specialize

in matching skilled professionals to an organizations needs. While often a full-time employee is required to possess a

broader set of abilities, a temporary employee can be a specialist in one particular field.


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short term contracting of employees. Some of the Determinants include the following:

Cost Reduction Strategy

Hiring employees on Short term basis is emerging as an increasingly commonplace practice for today's

cost-conscious companies striving to improve workplace productivity and profitability, while minimizing costs and

overhead. Particularly in light of the significant budget cuts and layoffs, which have taken place over the past few years,

contingent employment has become an integral part of companies' overall business strategy (Mochal, 2002). Employers

may also use short term contracts in order to provide certain groups of workers with lower wages or benefits. A unionized

company may pay above-market wages, and thereby have an incentive to use temporary agency workers or contract

workers who are not its legal employees and are not covered by the terms of the collective agreement. Even if a company is

not unionized, management may wish to pay above-market or efficiency wages to reduce turnover or shirking among

workers who have high levels of firm-specific human capital or who are difficult to monitor (Gleer, 2010). Although a

nonunion company legally may offer above-market wages to some workers and not to others, notions of inequality andtheir adverse effect on employee morale may inhibit management from doing so. Using short term contract particularly

agency temporaries and contract workers who are not the companys employees may enable management to lower wages

for certain groups with minimal adverse repercussions on morale. The incentive to use flexible staffing arrangements

among companies wishing to offer different benefits packages to different groups of workers is especially strong (Lawrads,

2006).

No law requires employers to offer benefits such as a retirement plan or health insurance plan to its employees.

However, if the company does offer these benefits, the benefits plans must comply with the Employee Retirement Income

Security Act and other benefits regulations in order to receive preferential tax treatment. These regulations limit an

employers ability to discriminate among employees in the benefits package offered. However, the regulations exclude

workers who have short tenures or who work fewer than a specified number of hours, and so often exclude a companys

part-time, on-call, and short-term hire workforce (Lawrads, 2006).

Moreover, temporary agency and contract workers generally are not deemed the client companys employees for

benefits purposes. As benefits costs, especially health insurance costs have risen relative to wages, employers have an

incentive to cut these benefits. By using flexible staffing arrangements, employers may restrict benefits to certain groups

without losing preferential tax status of their benefit plans (Conelly, 2013).

Omolo (2012) notes that most employers in Kenya, including the public sector have resorted to use of casual,

temporary, part-time, contract, sub-contracted and outsourced workforces to ostensibly reduce labour costs, achieve more

flexibility in management and exert greater levels of control over labour. This trend allows the de-politicization of hiring

and firing that makes it easier for companies to avoid labour legislation and the rights won by trade unions. The trend is

mainly attributed to strive for global competitiveness and weak enforcement of labour legislations, with the youth bearing

the brunt of such trends. The nature of employment of casual workers, for example, do not facilitate them to enjoy the

fundamental rights of workers such as freedom of association and collective bargaining, right to paid leave (sick, maternity

and annual leave), and the right to social protection as provided under the National Social Security Fund (NSSF) and the

National Hospital Insurance Fund (NHIF). This revelation contrasts sharply with the countrys desire to reduce poverty and

enhance social protection.


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Outsourcing of Services

Pine (2010) views outsourcing as the strategic use of outside resources to perform activities traditionally handled

by internal staff and resources. Outsourcing is a strategy by which an organization contracts out major functions to

specialized and efficient service providers, who become valued business partners. Sometimes outsourcing involves the

transfer of employees from the company to the outsourcing company. Greer (2001) further defines outsourcing is

commonly understood as contracting out of activities that were previously performed in-house. The trend toward

outsourcing has been extremely widespread and surveys have found as many as 91 to 93 percent of responding companies

engaging in outsourcing. According to Pine (2010) the common reasons why organizations outsource include: Reduce and

control operating costs; improve company focus; Gain access to world class capabilities; free internal resources for other

purposes; function is time consuming to manage or is out of control; insufficient resources are available internally; share

risks with a partner company. In the early days, cost or headcount reduction were the most common reasons to outsource.

In todays world the drivers are often more strategic, and focus on carrying out core value-adding activities in-house where

an organization can best utilize its own core competencies.

According to Greer (2001), the trend toward outsourcing has been caused by several strategic and operational

influences. From a strategic perspective, some human resource departments have attempted to shift their focus and

resources toward a more strategic role through the use of outsourcing. The Human Resource executives have used

outsourcing to relieve their departments of some of the more routine aspects of the function, such as those involving

routine, low-value-added transactions. Outsourcing also has been used to help reduce bureaucracy and to encourage a more

responsive and cost-sensitive culture by introducing external market forces into the organization through the biding

process. Human resource activities are among the services that have been outsourced in recent years. An example is that of

Telecommunications Company which outsource significant Human Resource services (Saunders & Hunter, 2007).

Outsourcing in Human Resource is based on the view that administrative work and operations can be carried out by outside

suppliers leaving Human Resource office to concentrate on strategic and high value-added work. With a growing number

of temporary, fixed term and outsourced service contract workers, there has been some interest in the effect of employment

status on motivation and commitment to work (Grint, 2012). Research by Guet et al. (1998) as cited by (Grint, 2012), into

the views of workers in a variety of different settings found that people on fixed term contracts generally had a positive

psychological contracts.

Reasons given for this were that employees on fixed contracts had more focused work to complete and did not

have to engage in organizational politics or complete administrative duties. They might also face lower work demands than

permanent staff, avoiding stress and taking less work home. Such employees enjoy better work-life balance. During the

low season, there may not be enough work to sustain a large workforce. Factories accommodate this seasonality in a

number of ways. The factories demand excessive overtime of all workers during the high season. The factories also may

Subcontract excess production to other factories during the high season. They may also employ workers with short-term

contracts which can be terminated during the low season. Using dispatched labour that can be dismissed during the low

season (Lawards, 2006).As noted earlier, many human resource management functions have been outsourced. When this is

done, the Human Resource executive or managers role changes from supervision of employees who perform these

functions to managers of vendor relationship. The skills required for managing such relationships are different than those

of direct supervision and involve the negotiation of contracts, sensitivity to the more strategic issues such as the importance


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of avoiding dependence on one vendor, and the need to maintain service levels through contractual relationship

(Greer, 2001).

According to outsource proffessional services (2013) Companies can save up to 20% of total process costs when

outsourcing administrative and non-core processes to a specialist provider. This is due to the usage of lower cost resources

(for example, different collective labour agreements), lower infrastructure costs (for example, better use of scale effects of

a specialist service provider) and use of the latest state-of-the-art technology. In the case of offshoring work to a low cost

country such as India, where wages can be up to 90% below US or European level, the benefit has been proven to be

significantly higher. In Technology, Specialist outsourcing providers in most cases use their own systems, methodologies

and industry know-how and have access to a large expert pool. When outsourcing processes to a specialist provider,

a company can ensure use of latest know how and best practices even for non-core processes and without having to invest

significantly in order to build these capabilities in house. Therefore resulting in greater process efficiency and

effectiveness, as well as quality of output that will increase over time (Greer, 2001). Flexibility is ensured specially

companies that face significant seasonal peaks or that grow at a rapid pace can harvest additional benefits from outsourcing

when working together with a specialist outsourcing provider: They have immediate access to a large expert pool and

expertise that grows flexibly in line with their business requirements (Grint, 2012)

At times where demand is low or stagnating, outsourced capacity can flexibly be adjusted downward at no cost

saving the company expensive redundancy payments and keeping morale of existing staff high. Transparency and new

optionsis a benefit in an outsourced business model, management is given more resources, options and increases in

transparency around performance of administrative and support services which then drive overall process efficiency.

Outsourced services can more easily be benchmarked and compared in the external market place both in terms of quality of

service and cost efficiency. Hence, management within the company easily ensure that consistently across the entire value

chain of high quality is delivered at a reasonable and competitive cost (Outsource Proffessional Service, 2013).

Labour Laws

The Employment Act Section 37 provides that where a casual employee; works for a period or a number of

continuous working days which amount in the aggregate to the equivalent of not less than one month; or performs work

which cannot reasonably be expected to be completed within a period, or a number of working days amounting in the

aggregate to the equivalent of three months or more, the contract of service of the casual employee shall be deemed to be

one where wages are paid monthly and concerning termination, section 35 of the act provides that: Where the contract is to

pay wages daily, the contract of service shall be deemed to be a contract terminable by either party at the close of any day

without notice; (b) Where the contract is to pay wages periodically at intervals of less than one month, the contract of

service shall be deemed to be a contract terminable by either party at the end of the period next following the giving of

notice in writing; or (c) Where the contract is to pay wages or salary periodically at intervals of or exceeding one month,

the contract of service shall be deemed to be a contract terminable by either party at the end of the period of twenty-eight

days next following the giving of notice in writing. Further, Section 45 of the act provides that no employer shall terminate

the employment of an employee unfairly. A termination of employment by an employer is unfair if the employer fails to

prove that the reason for the termination is valid; that the reason for the termination is a fair reason - related to the

employees conduct, capacity or compatibility; based on the operational requirements of the employer; and that the

employment was terminated in accordance with fair procedure (Employment Act, 2007). In addition, the section provides


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that an employee who has been continuously employed by his employer for a period not less than thirteen months

immediately before the date of termination shall have the right to complain that he has been unfairly terminated.

Conceptual Framework

Conceptual framework is a visual diagram that captures the main things to be studied that is the key factors,

concepts, or variables and the presumed relationships among them.The Conceptual framework assisted the Researcher in

developing an understanding of the situation under investigation. The research project utilized conceptual framework

illustrated in figure 1

Figure 1

Use of short term contracting of employees was conceptualized as being dependent variable. The determinants

like Cost reduction strategy, talent attraction, outsourcing of services and employee assimilation were conceptualized as the

independent variables. This means that short term contracting is used in order to reduce cost, attract talent, outsource

services and to attract talent. The intervening variable or the variable that comes in between was the labour laws since the

labour laws affect the independent variables as well as the dependent variables.

Summary of Literature Review

This research looked at the determinants of use of short term contracting of employees in Institutions of Higher

Learning. The literature looked at some of the reasons for short term contracting of employees. It also looked at the

benefits of short term contracting of employees. The challenges encountered due to this employment arrangement were

also looked at. The research aimed at achieving the following objectives: To determine how the use of short term

contracting of employees lead to cost reduction at Kabarak University. To analyze how outsourcing services at Kabarak

University influence short term contracting of employees.

Research Gaps

A study by Wandera (2011), at St. Pauls University entitled Effects Of Short Term Employment Contract on An

Organization, surveyed on short term employee in Kenya Forest Service, Nairobi Headquarters. The generalization of the

findings are not applicable to a Learning institutions due to the fact that the Kenya forest service is a government owned

organization while most of the private Institutions of Higher learning are owned by individuals or organizations.

The Kenya Forest Service benefits from government sponsorship while the Private Institutions of Higher learning are self

sponsored. This makes a very big gap since the Kenya Forest Service almost always have the resources required to carry on

their operations while the Private Institutions of Higher learning depend on the revenue collected from the Students fees

which is barely enough to run their operations. Thus the Kenya Forest Service is not faced with severe financial problems

as the Private Institutions of Higher Learning.

The categories of the employees in the Kenya Forest service are also very different from those of Institutions of

Higher learning. One of the major difference is that most of the employees in the Institutions of higher learning are


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teaching staff which none of this category exists in the Kenya forest service. The qualifications of the employees of the two

organizations are also very different. Most of the teaching staff are expected to have completed a Masters Degree and

above. The Kenya Forest Service have employees from different backgrounds and do not require higher qualifications as

Institutions of Higher Learning. The services provided by Kenya forest service is also very different from the servicesprovided by the Institutions of Higher Learning. These Institutions have the responsibility of imparting knowledge to

Kenyans. The Institutions of Higher learning deal with people and thus the services are geared towards improving people

in terms of skills, knowledge and capacity. The Kenya forest service deals with the environmental issues of the country.

Most of these studies were conducted in developed countries whose strategic approach and financial footing is different

from that of Kenya. Thus there is a literature gap on the Determinants of short term employment on organizations in

Kenya. This study seeks to fill the gap by investigating the determinants of use of short term contracting of employees to

Institutions of Higher learning, Kabarak University as a case.

RESEARCH DESIGN AND METHODOLOGY

The chapter gives summary information regarding the methodologies and procedures that were adopted and used

in the study. It describes the research design, target population, sample design, data collection procedures and methods that

were utilized for analyzing the data.

Research Design

The research technique that was used was descriptive design and specifically case study. A descriptive research

design was considered as the appropriate research design since it was a more appropriate strategy for answering research

questions which the researcher have no control over the events. Descriptive technique was used because it enables to

acquire a lot of information of the area under study, descriptions were used as an indirect test of a theory or model and

some behaviors or situations could not be studied in any other way. Descriptive studies present data in a meaningful form

thus help to understand the characteristics of a group in a given situation. The study was conducted at the Kabarak

University, Main Campus located along Eldama Ravine road near Kambi Ya Moto Centre.

The approach that was used was quantitative approach. The quantitative approach involved the generation of data

which was subjected to rigorous analysis in formal and rigid format. The methodology that was used to collect data was by

use of both primary and secondary data collection methods. Primary data was gathered directly from respondents and for

this study the Researcher used a questionnaire. This helped the researcher to obtain first hand information from the

respondents. Secondary data involves the collection and analysis of published material and information from other sourcessuch as annual reports and published data. Cooper and Schindler (2003) explain that secondary data is a useful qualitative

technique for evaluating historical or contemporary confidential or public records, reports and opinions.

Target Population

The research targeted teaching and non-teaching of Kabarak University. The total population was 198 permanent

employees comprising of 58 teaching and 140 non-teaching. In addition the research targeted 46 employees on short term

contract or temporary employees which comprised of 30 teaching staff and 16 non-teaching staff. This can be represented

in a table as shown in table 1


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Table 1: Target Population

Population

CategoryPermanent

Employees

Temporary

Employees

Teaching staff 58 30Non-teaching

staff140 16

Total 98 46

Sample Size and Sampling Technique

To determine a sample the formula below was used. The rationale for using this formula was because the

population was 244.

Where: N = target population of 244; S = sample size; e = level of significance of 10%

The researcher grouped the respondents into two: Permanent and temporary employees. The employees were

further put into two categories: teaching and non-teaching staff. This sampling is referred to as stratified and is a sampling

technique used when the population does not constitute a homogeneous group. This ensured that the study obtained a

representative sample. The Researcher will draw a sample of 70 respondents from both permanent and temporary staff.

This represents 28.6% of the population of staff of Kabarak University, Main Campus. Kothari (2004) explains that a

representative sample was one which was at least 10% of the population thus the choice of 28.6% is considered as

representative of the population. In order to draw a representative sample from the strata, simple random sampling method

was used. In this sampling method, each individual was chosen randomly and entirely by chance, such that each individual

had the same probability of being chosen. This can be presented in a table as shown in table.

Table 2

Category Population Sample Size

Category Permanent Temporary Permanent Temporary

Teaching staff 58 30 16 15Non-teaching staff 140 16 25 14

Total 198 46 41 29

Data Collection Instruments

In this research, primary data was collected through administration of a questionnaire. The questionnaire was

divided into various sections to adequately cover the objectives of the study. It further consisted of close ended and

structured questions. The structured questions provided a set of answers from which the respondents chose the appropriate

answers. Bryman and Bell (2003), explains that a self administered questionnaire is the only way to elicit self report on

peoples opinion, attitudes, beliefs and values. In order to fully meet the objectives of the study, the primary data gathered

was supplemented by secondary data from policy documents and manuals.


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Pilot Testing

The Researcher carried out a pilot study to enhance the validity and reliability of the questionnaire.

The Researcher selected a pilot group of 6 individuals (three on short term and three on permanent terms) from St. Pauls

University, Limuru which was an organization that had similar groups of employees to test the reliability and validity of

the questionnaire. The pilot data was not be included in the actual study. The pilot study allowed for pre-testing of the

research instrument. The clarity of the instrument items to the respondents was established so as to enhance the

instruments validity and reliability

Reliability of the Questionnaire

According to Walliman, (2001), reliability refers to the consistency of measurement and is frequently assessed

using the testretest reliability method. Reliability is increased by including many similar items on a measure, by testing a

diverse sample of individuals and by using uniform testing procedures. This was achieved by first clustering the

individuals according to the nature of their employment status.

Validity of the questionnaire

According to Somekh and Cathy (2005) validity is the degree by which the sample of test items represents the

content the test is designed to measure. Content validity which was employed by this study was a measure of the degree to

which data collected using a particular instrument represents a specific domain or content of a particular concept. Mugenda

& Mugenda (2003) contend that the usual procedure in assessing the content validity of a measure is to use a professional

or expert in a particular field. Hence to establish the validity of the research instrument the Researcher sought the opinions

of the Supervisor. This facilitated the necessary revision and modification of the research instrument thereby enhancing

validity. The pilot questionnaires were analysed using cronbachs alpha, where = 0.81 was obtained. The pilot study

enabled the Researcher to be familiar with research and its administration procedure as well as identifying items that

required modification. The results helped the Researcher to correct inconsistencies which arose from the instrument, which

ensured that it measured what is intended.

Data Analysis and Interpretation

The Researcher perused completed questionnaires to document analysis recording sheets. Data coding was done

by the use Microsoft excel office and the Statistical Package for Social Sciences (SPSS) version 20.0. Quantitative method

of data analysis was emphasized through the use of descriptive statistics. The information was displayed by use of tables.

Data Analysis

Quantitative data collected by using a questionnaire was analyzed by the use of descriptive statistics using the

Statistical Package for Social Sciences (SPSS) and Microsoft office excel. Descriptive statistics involves the process of

transforming a mass of raw data into tables and charts with frequency distribution and percentages which are vital in

making sense out of data Descriptive statistics employed were: frequencies, percentages and statistical mean. Inferential

statistics used was z-test. The samples were large and therefore z-test was used for difference in the means and test statistic

z was worked under: =

The results were then presented in tables for better understanding.


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Data Interpretation

Data was presented by calculating percentages, means and frequencies. The information was then displayed by

use of tables. This was done by tallying up responses, computing percentages of variations in response as well as

describing and interpreting the data in line with the study objectives and assumptions through use of SPSS and Microsoft

Excel 2007. The results were then interpreted in order to draw conclusions and recommendations. The advantage of using

the means was its use in summarizing the essential features of a series and in enabling data to be compared. It was also a

stable measure of central tendency.

RESEARCH FINDINGS AND DISCUSSIONS

Introduction

The chapter contains data gathered from the field, its analysis and presentation. This establishes the purpose of the

research and hence finds out the determinants of use of short term contracting in institutions of higher Learning. This was

achieved through data that was collected from employees of Kabarak University, Institution of Higher learning within

Nakuru County. To do this effectively the findings were presented using the following subtitle: Bio data of respondents,

Cost Reduction Strategy, Outsourcing of Services, Labour Laws, and Short Term Contracting. The data was collected from

both permanent and temporary employees of Kabarak University. The sample size was 70 respondents. Out of the 70

questionnaires distributed to the respondents, 64 (91.4%) questionnaires were filled and returned. This enabled the

researcher to proceed with analysis of data since the return rate of 91.4% was above what is recommended by Mugenda

and Mugenda (2009) of at least (70%).

Research Findings

Bio-Data Information

An analysis of the demographic information was carried out in order to know the characteristics of the

respondents that took part in the study. The demographic information analyzed included job category, gender, age, length

of service at Kabarak University, terms of service and education level of the respondents. On the job category of the

respondents. It was found out that majority of the respondents were the non-teaching staff comprising of 59.38% while the

rest, were teaching staff comprising of 40.63%. The non-teaching staff had a higher percentage compared to the teaching

staff because the sample of the non-teaching staff was higher than that of the teaching staff and this is reflected in the

responses. On the gender of the respondents it was found that majority of the respondents were males at 51.56% while the

females made up the remaining 48.44%. This implies a lack of gender balance in the recruitment of Kabarak University

staff, but conforms to the constitutional requirement of 2/3rds representation of either gender.

On the ages of the respondents the study found that the respondents between the ages of 25 and 31 years, majority

were on permanent basis (38.5%) and those on temporary basis stood at 12%. The case was different for the ones in the age

bracket 32 to 37 years where the majority were on temporary basis (40.0%) while the permanent ones stood at 40%.

Similarly, for the age bracket 38 to 42 years, majority were the ones on temporary basis (36%) while those on temporary

basis stood at 20,5%. This was different for the next age bracket of 43 to 49 years where the majority were those on

permanent basis (8%) followed by those on temporary basis (7%). Majority respondents aged 50 years and above were

permanent basis at 7.7% and temporary basis at 4.0%. In general, for the respondent on permanent basis, most of them

were aged between 25 and 31 years, while those on temporary basis were aged between 32 and 37 years. This is becausemost of the permanent employees were employed after finishing their University and tertiary level education at around the


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age of 25 and 31. The temporary basis employees have an experience in their field of operation and that is why most of

them are between 32 and 37 years. Kabarak University being a Private University is faced with a challenge of its

employees leaving the organization for greener pastures, this explains the low percentage of those over 50 years of age.

On the number of years served it was found out that those who had served for less than one year, majority were on

temporary basis (16.0%). For the respondents who had served at Kabarak University for between 1 and 3 years majority

were still those on temporary basis (56.0%) while the permanent ones stood at 17.5%. more of the permanent respondents

(38.5%) than temporary respondents (12.0%) had served for between 4 and 6 years. For those who had served for over six

years, majority were on permanent basis (41%) while the ones on temporary basis stood at 16.0%. Majority of the

permanent employees had worked for over 6 years in the University which meant that it was an employer of choice.

The temporary employees were highest at 1-3 years, reason being most of the employees would prefer full employment

and therefore cannot work as temporary for long periods of time. This can be clearly seen from the 16% who have worked

for over 6 years as compared to 41% for the permanent employees and also 56% of the temporary employees worked for

1-3 years compared to 17.9 for the permanent employees for the same period.

On the terms of service the majority of respondents considered for the study were on permanent terms of service.

The permanent employees stood at 60.9% while those employed on temporary terms stood at 39.1%. Owing to the fact that

the sample size of the permanent employees was 41 and the temporary employees were 29 explained why there were more

responses from the permanent employees as compared to the temporary employees. On the education level more of those

on permanent (12.82%) basis than temporary (8.0%) basis had secondary education. Similarly more of the permanent

(28.21%) than temporary (24.0%) respondents had tertiary education. However, more temporary (68.0%) than permanent

(58.97%) respondents had university education. The reason for having may employees with University education is

because the University appoints many teaching staff on temporary basis, so this group comprises of the external lecturers

and their qualifications must be masters or PhD level of education. This may also be the case for the high number of

employee with University qualification in the permanent employees. In addition many of the high level and middle level

managers must possess a University level education.

Findings as Per Objective

The following were the findings for the objectives of the study.

Cost Reduction Strategy

The respondents were asked a number of issues based on the cost reduction strategy and the results presented in

the table below:

Table 3


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The Table shows that employees on permanent terms of service agreed that they enjoyed other benefits other than

monthly salary (mean = 3.51, SD = 1.39) while the ones on temporary terms of service disagreed to this issue (mean =

2.48, SD = 1.36). The respondents on permanent basis said that they did not cater for their medical expenses (mean = 2.00,

SD = 1.26) while the temporary ones agreed that they catered for their own medical expenses (mean = 3.56, SD = 1.26).Those on permanent basis agreed they were members of Kabarak pension scheme (mean = 4.23, SD = 1.13) while the

temporary ones disagreed to this idea (mean = 1.72, SD = 0.98). The permanent ones agreed that the office space allocated

to them was adequate and comfortable (mean = 3.59, SD = 1.30) but the temporary ones disagreed to this issue

(mean = 1.96, SD = 1.14). Of interest to note is that the respondents on permanent (mean = 2.28, SD = 1.36) and temporary

(mean = 2.04, SD = 1.02) basis both disagree that they earn salary equal to other employees of their cadre. The ones on

permanent basis agree that they are given an opportunity to attend job training (mean = 3.64, SD = 1.35) while the ones on

temporary basis did not agree to this (mean = 2.32, SD = 1.18)

When the means for the temporary employees and the permanent employees are compared it can be noted clearly

that the permanent employees agreed that they enjoy other benefits, medical expenses are catered for, are in the pension

scheme, have adequate and comfortable office space and enjoy on job training which the temporary employees disagreed

to. However both the permanent employees and temporary employees disagreed that they earn a salary equal to other

employees of their level. These findings are in agreement with Mochal (2002) who says that in light of the significant

budget cuts and layoffs, which have taken place over the past few years; contingent employment has become an integral

part of companies' overall business strategy. Employers may also use short term contract in order to provide certain groups

of workers with lower wages or benefits. Outsourcing of services

The respondents responded to a number of issues to determine the use of outsourced services in Kabarak

University and the results were presented in table below:

Table 4

As it can be seen the respondents on permanent (mean = 1.51, SD = 0.942) and temporary (mean = 2.44,

SD = 1.469) both disagree to the notion that their work is seasonal. Whereas those on permanent basis agree that the

university provides for all working equipment and instruments (mean = 3.56, SD = 1.314), those on temporary basis

disagreed (mean = 2.42, SD = 1.122). The permanent ones agreed that the university remunerates them (mean = 3.90,

SD = 1.021) while the temporary one disagreed (mean = 2.34, SD = 1.375). Both the permanent (mean = 4.18, SD = 1.048)and the temporary (mean = 4.04, SD = 1.136) agreed that they are specialists in their area of operation. While the ones on


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the temporary basis. They however, disagreed that they had more free time and they are developed by the university.

Hypothesis Testing

Z-tests were conducted to determine if the means of the two samples differed. The z-test values obtained were

compared with the critical (table) values at the 0.05 level of significance..z -test for Cost Reduction strategy and short

Term Contracting

A z-test was carried out to test hypothesis that:

H0: Cost Reduction does not significantly lead to use of short term contracting in Kabarak University. H1;

Cost reduction significantly led to use of short term contracting of employees in Kabarak University. z-tests were

conducted at 0.05 level of significance to compare if the means of permanent and temporary employees on cost reduction

strategy differed and the results were as presented in a tablebelow:

Table 5:Z-Test on Cost Reduction Strategyand Short Term Contracting

Terms of

Service

Mean of Cost

ReductionSD

Sample

Size

Permanent

Permanent

=3.20=2.34 1 =1.2982 =1.567 n1=39n2=25Using the z- test statistic, the results obtained were as follows:

Table 6

Z Test

Value

Level of

Significance

Critical

(Table)

Value

2.559 0.05 1.64

The z calculated was 2.559 and the table value was 1.64 at 0.05 level of significance. Since the calculated value

exceed the table value the H0that cost reduction does not lead to use of short term contracting of employees was rejected.

It was concluded that cost reduction led to use of short term contracting of employees in Kabarak University.

Z-Test for Outsourcing of Services and Short Term Contracting

The second hypothesis stated that: H02: Outsourcing of services at Kabarak University does not significantly

influence short term contracting of employees. H2: Outsourcing of services at Kabarak University significantly influenced

short term contracting of employees. Z-test was conducted at 0.05 level of significance and the results were as presented in

a tableas can be seen below:

Table 7

Mean of

Outsourcing of

Sevices

SDSample

Size

Permanent

Temporary

=3.23=2.80 1 =1.1752 =1.337 n1=39n2=25Using the z- test statistic, the results obtained were as follows:


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Table 8

Z Test Value Level of Significance Critical (Table) Value

1.927 0.05 1.64

The z calculated was 1.927 while the table value was 1.64 at 0.05 level of significance. Since the calculated valueexceeds the table value the H0 hypothesis that outsourcing of services at Kabarak University does not significantly

influence short term contracting of employees was rejected. It was concluded that outsourcing of services at Kabarak

University led to use of short term contracting of employees in Kabarak University.

CONCLUSIONS AND RECOMMENDATIONS

Conclusion

The study sought answers to the following hypothesis: Cost reduction does not significantly lead use of short term

contracting of employees in Kabarak University, outsourcing of services at Kabarak University does not significantly

influence short term contracting of employees, there is no significant relationship between talent attraction and short term

contracting in Kabarak University, assimilation into full time employment does not significantly determine the use of Short

term contracting at Kabarak University. The objectives of the study were met and relationship between the independent

and dependent variables determined. The following are the conclusions of study per objective:

The permanent employees of Kabarak University enjoyed benefits other than salary, had a medical cover, were

members of pension scheme, had office space allocated and were offered job training which the temporary employed did

not. This was a cost reducing strategy and this led to Kabarak University engaging employees on short term basis. The null

hypothesis was tested and it was concluded that Cost reduction significantly led to use of short term contracting of

employees in Kabarak University. However, it was of concern that both the temporary and permanent employees felt that

there was no equity in the salaries provided to them. Kabarak University outsourced some of the services so that the firms

which services were outsourced from provided for their own working equipment and instruments, paid all its salaries and

wages, provided specialized quality services, the firm supervised its employees and for the University to avoid paying

overtime to its employees. It was concluded that outsourcing of services determined the use of short term contracting of

employees in Kabarak University.

Recommendations

To cut operating costs as well as other benefits cost, Kabarak University should continue to engage employees on

short term contracts. Other Institutions of Higher learning should incorporate short term contracting in their employment

engagement as a cost reduction strategy. Kabarak University should continue outsourcing of services as this brings about

specialists and high quality services. Institutions both private and public should put a policy in place of engaging

outsourcing firms so that they can concentrate on more critical issues while the outsourced firms provide high quality

service.

Areas for Further Study

A study to determine how the use of short term contracting of employees affects the performance of employees

in the Institutions of Higher Learning. The effects of counseling on employees performance in health institutions in

Kenya. A case Study of Rift Valley Provincial General Hospital. A study on Generational Differences and the Challenges

they cause to the Organizations.


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