Evaluation of Employee Retention Practices to Generation Y at Cooperative Bank in the County of Nairobi, Kenya

Abstract

There has been a problem of increase in employee turnover at the Cooperative bank. This is shown by an increase of turnover from 15% in the year 2005 to 19% ten years later in 2015. Labour market is currently being faced with a number of diverse trends. One element of this is the Generation Y type of employees. These are young employees born in the early 1980s and early 1990s who are joining the labour force with unique needs, aspirations and demands. The study utilized Herzberg two factor theory, Equity theory and Hierarchy of needs theory. The key variables for the study were: Reward and compensation practices; Career management practices; Training and development practices, and; Work-life balance practices. A stratified random sampling technique was used for the study. The researcher purposely selected the head office and Parliament branches. The target population of the study was 392 Generation Y employees. Census was conducted on employees of the head office and Parliament branch. The sample size was 89. After data had been collected, the researcher conducted data cleaning, and then the data was coded and entered in the computer for analysis using the Statistical Package for Social Sciences. Data was then analyzed using descriptive and inferential statistics. A total of 71 questionnaires were returned as correctly filled which were subsequently used in the analysis, representing response rate of 79.8%.The age group of majority of Generation Y employees at Cooperative bank lied between 28-36 years at (65.2%). Majority (58.3%) of the respondents were male while the rest (41.7%) of the respondents were female. Majority (44.0%) of the respondents had a working experience between 3 to 6 years. Regression results revealed that there was an existing linear relationship between reward and compensation and retention of generation Y employees (β = 0.371; p = 0.002, α = 0.05);  career management practices and retention of generation Y employees (β = 0.184; p = 0.020, α = 0.05); training and development practices and retention of generation Y at Cooperative bank in the County of Nairobi (β = 0.163; p = 0.040, α = 0.05).,and; work-life balance and retention of Generation Y’s yielded Beta values, (β = 0.498; p= 0.001). All this led to the rejection of the null hypothesis and conclusion that indeed they were significant in retaining Generation Y employees. The study recommended that: there was need to have well scheduled salary review by the management;  Career management methods like having career counselling facilities, career mentors, career planning and career development programs should be widely adopted by banks; Training and development opportunities should be availed to all employees and ensure there is continuous skills improvement of the work force; banks should consider more on work-life balance practices are in place, and; further study is needed also to determine the nature of reward preferred by the commercial banks employees to be able to make the system work better and achieve greater results as envisaged in the strategic plan and future plans to succeed. This study may also be replicated in other similar organizations to compare the outcomes.

Keywords: Reward and compensation practices, Career management practices, Training and development practices, Work-life balance practices and retention practices.