JOSE RIZAL MEMORIAL STATE UNIVERSITY

The Premier University in Zamboanga Del Norte

Main Campus, Dapitan City
FINANCIAL INCENTIVES AND EMPLOYEE PRODUCTIVITY:
ITS RELATIONSHIP

A Research
Presented to the
Faculty of the College of Business Administration
JOSE RIZAL MEMORIAL STATE UNIVERSITY
The Premier University in Zamboanga del Norte
Main Campus, Dapitan City

In Partial Fulfillment
Of the Requirements for the Degree
Bachelor of Science in Accountancy

Lovely Jayne P. Duran

Dia Mae A. Generoso
Kae Alymar R. Quintero
Noven D. Romasasa

JUNE 2022
 Republic of the Philippines
JOSE RIZAL MEMORIAL STATE UNIVERSITY
The Premier University in Zamboanga Del Norte
Main Campus, Dapitan City

COLLEGE OF BUSINESS ADMINISTRATION

APPROVAL SHEET

This research study entitled “FINANCIAL INCENTIVES AND EMPLOYEE

PRODUCTIVITY: ITS RELATIONSHIP” prepared and submitted by Lovely Jayne P.
Duran, Dia Mae A. Generoso, Kae Alymar R. Quintero, and Noven D. Romasasa in partial
fulfilment for the degree Bachelor of Science in Bachelor of Science in Accountancy, has been
reviewed and approved by the Panel of Examiners.

EDELYN E. PAGARA, MBA

Adviser

PANEL OF EXAMINERS

APPROVED by the PANEL OF EXAMINERS ON ORAL DEFENSE conducted on

June 28, 2022 with the rating of PASSED.

LOVELLE P. PALLEGA, PH.D (CAR)

Chairman

ANNA RHEA MICHELLE S. BUREROS, CPA, MBA

Member

JANVEN A. GRANFON, CPA, DBA, (CAR)

Member

ANA FLOR S. ADRIAS, DM

Instructor (AEACC24/Accountancy Research)

ACCEPTED AND APPROVED by the Associate Dean of the College of Business

Administration.

AMIEL B. ANDIAS, DPA, DBA

Associate Dean, College of Business Administration
Date signed: __________

ii
 ABSTRACT

The main purpose of this study was to examine the relationship between financial

incentives and employee productivity in Montaño Foods Corporation. A descriptive

research design was adopted with Montaño Sardines being the focus organization. The

population of this study comprised of all the 92 production employees of Montaño Foods

Corporation. Weighted mean was utilized to find out the employee’s rating on the

motivation in terms of financial incentives/monetary factors. Spearman Rank-order

correlation coefficient was used to test the significant relationship between employee

motivation and employee productivity. Non-parametric Kruskal Wallis H and Mann-

Whitney U tests was also used to analyze the significant difference of employee

productivity according to the respondents’ profile.

Majority of the respondents are between the ages of 41 and above, with more than

half of them being female, married, high school level/graduate, and mostly had already

worked for 3-5 years. Financial incentives and rewards positively effect on employee’s

commitment or loyalty. Employees stay in an organization because the benefits of being

part of an organization far outweigh the cost of leaving the organization. It is observed

that majority of the financial incentives/ monetary factors has been strongly agreed on

with the employees, except for one which concluded that not all financial incentives

guarantee to motivate employees. It is recommended that the management should

reassess its salary and benefits package, enhance their pay policy and develop financial

incentives and rewards that would improve employment relationship.

Keywords: Employee Motivation, Employee Productivity, Financial Incentives

iii
 ACKNOWLEDGEMENT

The researchers express their heartfelt thanks and gratitude to the following

people who extended their unceasing support and who made remarkable contributions to

the completion of this study:

To Ma’am Edelyn E. Pagara and Ma’am Ana Flor S. Adrias, who have always

been there for them whenever they needed help;

To the respondents, who agreed to help the researchers by answering the

questionnaires;

To their parents, for giving them financial and moral support in making this

study;

To all of the people who made this study a success, thank you very much.

Above all, to God Almighty, who gave the researchers the opportunity to live,

guide them in their daily lives, give them strength and wisdom to be patient with the

process and give EVERYTHING they needed for the success of the said endeavor.

The Researchers

iv
 DEDICATION

This humble work is dedicated to all the people who became the researchers’

source of strength and helped them while in the process of doing and completing the

study.

To the researchers’ family, who provided them courage and love, who willingly

supported them with financial matters, motivating them every step of the way, and

supporting them in all aspects of the game; emotionally, mentally, physically and

spiritually, they are always there to guide them.

To their fellow researchers, and to their instructor in Strategic Business Analysis

who never failed in giving them suggestions and advises, for being so approachable every

time the researchers need him, for being so patient and inspiring them in finishing the

study;

And also, the researchers offer this work to the most loving Father and Redeemer

whose spiritual help made this work successful.

v
 TABLE OF CONTENTS

APPROVAL SHEET ii
ABSTRACT ii
ACKNOWLEDGEMENT iv
DEDICATION v
LIST OF TABLES vii
LIST OF FIGURES ix
CHAPTER I THE PROBLEM AND ITS SCOPE
Introduction 1
Theoretical Framework 3
Conceptual Framework 10
Statement of the Problem 12
Hypothesis 13
Significance of the Study 13
Scope and Limitation of the Study 13
Definition of Terms 14
CHAPTER II REVIEW ON RELATED LITERATURE AND STUDIES
CHAPTER III RESEARCH METHODOLOGY
Research Method 26
Research Environment 26
Research Respondents 27
Research Instruments 28
Ethical Considerations 29
Data Gathering Procedure 30
Statistical Treatment of Data 30

vi
CHAPTER IV PRESENTATION, ANALYSIS, AND
INTERPRETATION OF DATA
CHAPTER V SUMMARY, CONCLUSION AND RECOMMENDATIONS
Summary 43
Conclusion 45
Recommendations 46
REFERENCES
APPENDICES
A Letter to the CBA System Dean
B Letter to the Respondents
C The Questionnaire for Employees

vii
 LIST OF TABLES

Tables
1 Profile of the employees in Montaño Foods Corporation

in terms of age 28

2 Profile of the employees in Montaño Foods Corporation

in terms of sex 30

3 Profile of the employees in Montaño Foods Corporation

in terms of civil status 31

4 Profile of the employees in Montaño Foods Corporation

in terms of educational attainment 31

5 Profile of the employees in Montaño Foods Corporation

in terms of number of years employed 32

6 Employees’ rating on their motivation in terms of financial

incentives/monetary factors 33

7 Employees’ perception of the level of productivity in the

company 35

8 Test of Significant Difference in the level of productivity of the

employees when the data are analyzed according to profile 39

9 Test of a significant relationship between employee motivation

and employee productivity 41

viii
 LIST OF FIGURES

Figures
1 Schematic Diagram of the Study 11

2 Map of Montaño Foods Corporation 27

ix
 CHAPTER I

THE PROBLEM AND ITS SCOPE

Introduction

The term motivation is derived from the Latin word ‘movere’ which means to

move (Baron, Henley, McGibbon and McCarthy, 2012). Certo (2016) describes

motivation as giving people incentives that cause them to act in desired ways. Motivation

has also been described as the process of arousing and sustaining goal-directed behavior

(Nelson, 2013).

According to (Omollo, 2015), motivation is the key of a successful organization

to maintain the continuity of the work in a powerful manner and help organizations to

survive. Motivation is finding a need inside the employees and help to achieve it in a

smooth process. Motivating the staff leads to broaden their skill to meet the

organizational demands. Each branch manager should have the responsibility to work

with the staff to find out their individual needs and put them side by side to the

organization needs. The only way to get people to like working hard is to motivate them.

Today, people must understand why they're working hard. Every individual in an

organization is motivated by some different way. When talking in term of employee

motivation, it can be simply defined as “Employee motivation is a reflection of the level

of energy, commitment, and creativity that a company's workers bring to their jobs.”

Motivation is the most important matter for every organization public or a private sector.

For the success of any organization, motivation play an important role.

The improvement in productivity is indeed the main goal for any firm where all

units or departments work closely to increase its performance through different

management strategies (Bandara & Weligodapola, 2013). Accordingly, employee

productivity can be measured by the number of products and services produced by an

employee in a certain period of time, with an emphasis on quality maintenance. 

Many organizations are concerned with what they should do to accomplish high

levels of performance through their human capital (Forson, 2012). For some of the

organizations to enhance their performance, they believe that the productivity of

employees can be highly affected by their motivation, attitude, and behavior (Kawara,

2014). Forson (2012) illustrated that adequate motivational incentives for employees are

among the best ways to manage as well as to reach organizational objective or mission

with minimum resource usage and available human capital. On the other hand, certain

issues of less motivation may arise as they affect certain workers who go to the

workplace with different expectation, behaviors and outlooks, and become less

committed to the organization.

The motivation among employees plays an important role in transforming an

organization. Thus, it is necessary for both employers and decision makers to identify the

needs and concerns of their team members and further understand what drives them to be

more productive (Rodriguez, 2015). In the prior literature, it is evident that highly

motivated employees are perceived to be more performance oriented, satisfied, and

highly committed to their work and organizations for a long period of time (Singh, 2013).

Unfortunately, despite the significance of motivation and organizational commitment in

influencing the productivity of employees, empirical research on this link is scarce.

According to Swart (2010), to understand motivation building factors and the effect of

motivation on employee productivity, a further investigation is needed. Moreover, Salleh,

2
Dzulkifli, Abdullah, and Yaakob (2011) reported that there are few empirical researches

which have examined the impact of motivation on the productivity of employees in the

government sector.

In the domestic market, Montaño Sardines is a sought-after commodity in the

bottled sardines’ sector. It is a type of food industry which is the first manufacturer of

bottles sardines in the Philippines, that allowed just the word of mouth to spread the

company’s name in the local market and to overseas Filipinos hankering for that killer

homemade Spanish style sardine’s recipe. Here, where there are about 15 bottled

sardines’ manufacturer, Montaño Sardines has a commanding 80 percent share of the

local market. The production employees in Montaño needs to work harder to meet the

demand and for the employees to be more productive, they need to be motivated.

It was for this purpose that the researcher will aim to study the relationship

between employee’s motivation towards employees’ productivity in Montaño Foods

Corporation of Dipolog City.

Theoretical Framework

This study is anchored on the Expectancy Theory of Vroom (1964), which

emphasizes the needs for organizations to relate rewards directly to performance and to

ensure that the rewards provided are those rewards deserved and wanted by the

recipients. Expectancy Theory proposes that a person will decide to behave or act in a

certain way because they are motivated to select a specific behavior over other behaviors

due to what they expect the result of that selected behavior will be. In essence, the

motivation of the behavior selection is determined by the desirability of the outcome.

However, at the core of the theory is the cognitive process of how an individual processes

3
the different motivational elements. This is done before making the ultimate choice. The

outcome is not the sole determining factor in making the decision of how to behave.

Waiyaki (2017) cited the following motivational factors: Goal Setting, Financial

Incentives, Recognition and Rewarding, but in this study, only financial incentives/

monetary factors is being included.

On the other hand, the questionnaire about employee productivity was anchored

from the study of Alam, Hassan, and Reaz (2020).

Financial Incentives

Money is the principal inducement and no other incentive comes close to

it with respect to its influential value (Locke and Latham, 1990). Money has the

dominancy to magnetize, retain and motivate individuals towards higher performance

(Stanley, 2012). People do not work for free; employees want to be compensated for the

work that they do. Employees must be motivated through adequate incentives plans and

reward systems and this will invariably encourage them to be proactive and have right

attitude to work, thereby promote organizational productivity (Armstrong, 2007).

McChilloh (2001), posits that financial incentives mean any inducement involving

the payment of money and reduction in price paid for goods or services or any award of

credit. Financial incentives and rewards positively effect on employee’s commitment or

loyalty. Employees stay in an organization because the benefits of being part of an

organization far outweigh the cost of leaving the organization (Saleem, 2011). The fact

that employees fear losing their job makes money an extremely effective motivator

because it is indispensable for survival in an economy (Cole, 2000).

4
 Financial incentives enhance the employment relationship because it creates the

basis for high levels of commitment and therefore, firms must develop strategies that

include financial incentives and rewards for example promotion, bonus, profit sharing or

gain sharing and employees stock ownership etc. (Ismail, Guatleng, Chhekiong, and

Ibrahim, 2009). In fact, some authors assert that the primary aim of incentives is to

enhance extrinsic motivation by satisfying an individual employee’s needs indirectly

through means of pay and bonuses (Anthony and Govindarajan, 2007). A natural way to

motivate workers at any level is to offer them financial incentives; linking pay to

performance improves the motivation value of money (Kinicki and Kreitner, 2016).

Many jobs require financial rewards to motivate employees and many people primarily

work to make money or attain the recognition denoted by financial rewards (Giancola,

2011).

The following are the Financial Incentives/Monetary Factors:

Satisfaction With Pay

According to equity theory, pay satisfaction is based on perceptual and

comparative processes (Adams, 1963; Lawler, 1990; Lum et al., 1998). Equity

theorists posit that employees seek the equilibrium between what they invest or

put into their jobs in terms of effort, knowledge and skills, and what they get as an

outcome through compensation or recognition (Adams, 1963; Greenberg, 1987,

1990; Milkovich and Newman, 2008).

5
 Lawler (1971) further suggests that satisfaction or dissatisfaction with pay

is influenced by the discrepancy between what employees perceive they should

receive for their inputs (or their pay) and what they contribute to the organization.

Competitive Pay

A natural way to motivate workers at any level is to offer them financial

incentives; linking pay to performance improves the motivation value of money

(Kinicki and Kreitner, 2016). Many jobs require financial rewards to motivate

employees and many people primarily work to make money or attain the

recognition denoted by financial rewards (Giancola, 2011).

Competitive Benefits Package

While there are a variety of ways to compensate a sales force, most

companies use three main methods: straight salary, straight commissions and a

combination of salary and commissions (Wiese and Coetzee, 2013). Besides

salary and commission, financial compensation could also include reimbursement

of sales expenses and transportation (Wiese and Coetzee, 2013). Fredrick Taylor

has described money as the most fundamental factor in motivating the industrial

workers to attain greater productivity (Steers and Porter, 2011). It is therefore

imperative that organizations think critically about the remuneration packages that

they offer to their employees.

Monthly Expense Allowance

In the study of Sreenath, S., Mohan, & Lavanya, (2019), A point of

suggestion was that spectacle monthly expense allowance can add more

6
motivation to the employees. Moreover, benefits need to be kept flexible and it

has to be reviewed from time to time. Many organizations, as a matter of practice

have accommodated travel benefit/expenses or can be called as business trip

which includes airfares, train travel bookings, hotel stays, outstation allowance

and travel insurance.

Monetary Rewards

Lazear (1986) positively suggests that by adding financial rewards to the

compensation of employee for the sake of motivation can attract more geared

workers to the organization. By other point of view, Lazear (2000) also described

that introduction of monetary rewards could gain extra efforts of the employee to

that extent where the marginal value added is equal to the marginal cost paid for

that additional work. This shows that financial incentives are some types of paid

value to employees in return for their extra efforts. Lazear (2000) showed a

positive relation between employee engagement and rewards and firm’s

productivity.

Money as an Incentive

There is a strong possibility that monetary rewards enhance employee

motivation and loyalty, and as consequence their productivity and organizational

efficiency. It is probable that employees view bonuses and inducement payments

as an award, and believe that they must repay this by acting in the interests of the

organization, and more than that, by doing something above and beyond their

usual responsibilities.

7
Salary Dissatisfaction

Less pay as compared to work done is one of those extrinsic factors which

is responsible for job dissatisfaction (Robbins, 2003). Yang, Miao, Zhu, Sun, Liu

and Wu (2008) suggested that, in Chinese forces it is considered that pay and

satisfaction influence each other. Pay has direct influence on satisfaction level of

employee. NL (2012) described that pay is one of those satisfying variables which

hindered reduces the dissatisfaction level of employees.

Value on Services

Financial incentives and rewards positively effect on employee’s

commitment or loyalty. Employees stay in an organization because the benefits of

being part of an organization far outweigh the cost of leaving the organization

(Saleem, 2011). The fact that employees fear losing their job makes money an

extremely effective motivator because it is indispensable for survival in an

economy (Cole, 2000). Therefore, employees that are satisfied with financial

incentives and rewards given by firms will value their services more.

Attract and Retain Employees

The Most important human resource management issue nowadays is

rewards structure (Milkovich & Newman, 2008). But due to global competition

and environmental uncertainty most employers have shifted from traditional way

of rewards structure and design them on the basis of performance, skills

knowledge and competency (Lawler, 2000) which attracts, retains and motivates

talented employees to achieve their objectives (Milkovich & Newman, 2008).

8
 Their proper implementation results in improved employee satisfaction, increased

teamwork and motivation and employee’s productivity (Drucker & White, 2000).

The empirical results of the administration of benefits showed positive association

between employee’s commitment and financial incentives and rewards.

Profit Sharing

Recently there has been a strong growth of interest in profit sharing and

related forms of pay for group performance. Many reasons undoubtedly exist fir

this heightened attention. The primary motive probably has to do with the

perception that by giving workers a partial stake in their company's performance,

profit sharing may, under certain circumstances, lead to desirable outcomes that

ultimately increase productivity. If this perception contains an element of truth,

widespread profit sharing might conceivably improve national "competitiveness",

with consequent policy implications. In such a context, but also for more general

reasons, it becomes important to sort out and evaluate as systematically as

possible the evidence on a possible link between profit sharing and productivity.

(Weitzman, & Kruse (1990).

Employee Productivity

Productivity is a performance measure encompassing both efficiency and

effectiveness. It is important, therefore, to know who the productive workers are. High

performing, effective organizations have a culture that encourages employee

involvement. Therefore, employees are more willing to get involved in decision-making,

goal setting or problem-solving activities, which subsequently result in higher employee

9
performance. Encourage a more modern style of participatory management, raise

employee productivity and satisfaction, and even lower workers’ compensation rates.

According to Miller and Monge (1986) job satisfaction increases productivity through

bringing high quality motivation and through increasing working capabilities at time of

implementation. There is evidence that participative climate has a more substantial effect

on worker’s satisfaction then participation in specific decision and it appears that

participation in goal setting does not have strong effect on productivity. Participation has

a strong effect on both job satisfaction and productivity, but its effect on satisfaction is

somewhat stronger than on productivity.

Conceptual Framework

Figure 1 shows the schematic diagram of the present study. The independent

variable shows the following list of Financial Incentives/ Monetary factors: Satisfaction

with Pay, Competitive Pay, Competitive Benefits Package, Monthly Expense Allowance,

Monthly Expense Allowance, Money as an Incentive, Salary Dissatisfaction, Value on

Services, Attract and Retain Employees, Profit Sharing while the dependent variable is

the employee productivity of Montaño Foods Corporation.

10
 Independent Variable Dependent Variable

FINANCIAL INCENTIVES/ EMPLOYEE

MONETARY FACTORS PRODUCTIVITY

Figure 1. Schematic Diagram of the Study

11
Statement of the Problem

This study aimed to determine the relationship of employee motivation and

employee productivity in Montaño Food Corporation in Dipolog City. Specifically, the

researchers sought answers to the following question:

1. What is the profile of the employees in Montaño Foods Corporation in terms of:

1.1 Age;

1.2 Sex;

1.2 Civil Status;

1.3 Educational Attainment; and

1.4 Number of Years Employed

2. How do the employees rate the financial incentives/monetary factors?

3. How do the employees perceived their level of productivity in the company?

4. Is there a significant difference on the employee productivity when analyze

according to the respondent’s profile in terms of:

1.1 Age;

1.2 Sex;

1.2 Civil Status;

1.3 Educational Attainment; and

1.4 Number of Years Employed

5. Is there a significant relationship between employees’ financial

incentives/monetary factors and employee productivity in Montano Foods

Corporation in Dipolog City?

12
Hypothesis

HO1: There is no significant difference on the employee productivity when

analyze according to the respondent’s profile.

HO2: There is no significant relationship between employee motivation and

employee productivity in Montaño Foods Corporation in Dipolog City.

Significance of the Study

This study shall be beneficial to the following:

Employers. The study will provide the owner of Montaño Foods Corporation

insights as bases in which employee benefits gives more value to the employees that will

make them more productive.

Employees. The study will provide avenues to the employees what they perceive

the ideal employee benefits to ensure their loyalty, satisfaction and gives them more

motivation.

Readers/Researchers. This will serve as a basis or reference to the readers or the

researchers who will continue to study about the effects of motivation towards employee

performance.

Scope and Delimitation of the Study

The study shall be delimited to the following indicators provided by the

researcher.

13
 Content. This study shall focus on the relationship between financial

incentives/monetary factors and employee productivity in Montaño Foods Corporation of

Dipolog City this Fiscal Year 2022.

Place. This study shall be conducted in the Montaño Foods Corporation’s main

office, Dipolog City.

Research Method. This study shall use the descriptive research on normative

survey approach purposely, with the use of questionnaire as research instrument, be able

to get the profile of the employees and the assessment of the employee motivation offered

in Montaño Foods Corporation.

Subject. The subject of this study shall be limited to all the production employees

of Montaño Foods Corporation. The researchers opt to conduct with the whole

production employees of Montaño Foods Corporation, thus the 92 production employees

as what the HR manager Mr. Bryan Debarra stated. Further, all of the employees of the

production team in Montaño Foods Corporation shall assess the employee motivation

offered and its relationship towards employee productivity.

Definition of Terms

Employee Motivation. In this study, employee motivation were the financial

incentives that will motivate employees’ desire to do the best possible job or to exert the

maximum effort to perform assigned tasks.

Employee Productivity. Productivity is a performance measure encompassing

both efficiency and effectiveness of the employees in Montaño Foods Corporation.

14
 Financial Incentives. Financial Incentives was one of the motivational factors

that has ten financial/monetary factors, namely: satisfaction with pay, competitive pay,

competitive benefits package, monthly expense allowance, monetary rewards, monetary

as an incentive, salary dissatisfaction, value on services, attract and retain employees, and

profit sharing.

15
 CHAPTER II

REVIEW ON RELATED LITERATURE AND STUDIES

Literature and studies related to the present investigation were being reviewed

purposely to gain insight and to augment the explanation of the theoretical and

conceptual framework of the study.

Employee Motivation

According to (Omollo, 2015), Motivation is the key of a successful organization

to maintain the continuity of the work in a powerful manner and help organizations to

survive. Basically, motivation word is derived from “Motive”. The meaning of “motive”

is needs, wants, and the desire of the persons. So that “employees motivation means the

process in which organization inspiring our employee with the shape of rewards, bonus

etc. for achieving the organizational goals (Chaudhary & Sharma, 2012). The growth of

employee motivation has increased significantly over the years. The primary reasons for

this growth are societal pressures, employer self-interest and favorable rates from group

participation. With the prevailing uncertainty in the economy, coupled with an emphasis

on customer satisfaction and long-term business relations, there is revived interest in the

motivation of employees. Ramdhani (2008) examined the relationship between

motivation and employee productivity in higher education context and found a positive

link between both of them. They further indicated that employees’ motivation is highly

correlated with the level of productivity. Moreover, Srivastava and Barmola (2012)

demonstrated that motivation is very important for improving organizational commitment

among workers, which resultantly leads to higher levels of productivity. In other words,
committed employees tend to receive motivation at the workplace and be rewarded for

good achievements. Therefore, motivation can be considered as the driver of employee’s

productivity and organizational commitment (Al-Madi, Assal, Shrafat, & Zeglat, 2017;

Bloisi, Cook, & Hunsaker, 2007).

Financial Incentives

Financial incentives mean any inducement involving the payment of money and

reduction in price paid for goods or services or any award of credit (McChilloh, 2001). It

has a strong motivational effect on employees if they value it, if they believe good

performance is instrumental in bringing the desired reward and if they expect their efforts

will achieve the desired performance (Lawler, 1971). According to Locke and Latham

(1990), “money is the principal inducement and no other incentive comes close to it with

respect to its influential value. It has the dominancy to magnetize, retain and motivate

individuals towards higher performance (Stanley, 2012). Financial incentives and

rewards positively effect on employee’s commitment or loyalty. Employees stay in an

organization because the benefits of being part of an organization far outweigh the cost of

leaving the organization (Saleem, 2011). The fact that employees fear losing their job

makes money an extremely effective motivator because it is indispensable for survival in

an economy (Cole, 2000). In this reason, firms must develop strategies that includes

financial incentives and rewards that would enhance the employment relationship as it

creates the basis of commitment. This includes extrinsic motivations like promotion,

bonus, profit sharing or gain sharing and employee stock ownership (Ismail, Guatleng,

Chhekiong, and Ibrahim, 2009).

17
Employee Productivity

The concept of productivity is one of the most fashionable and frequently used in

the domain of management today. It is described as the optimal utilization of resources in

the production of goods and rendering of services that meets predetermined objectives.

Aiyetan and Olotuah (2006) described productivity as the amount and quality of output

that an individual generates using certain inputs. The normal measures for productivity

are evaluated according to the outcomes or tasks accomplished based on the hours

worked. A similar definition of employee productivity was suggested by Syverson (2011)

as the aggregate output that is achieved by an employee within a particular period of time

and is evaluated according to its efficiency and effectiveness in reaching the desired

objectives and job requirements. Over the past years, several organizations have been

trying to enhance employee productivity using different strategic techniques. Many

scholars noted that the motivation of employees and effective management play

significant roles in boosting their productivity and organizational performance (Aktar et

al., 2012; Kawara, 2014; Scott, 2015; Swart, 2010). For this reason, organizational and

employee’s performance have received wide interests and captured the attentions of

various scholars recently.

Satisfaction with Pay

Pay satisfaction is of primary concern to both employers and employees.

For employees, pay is of obvious importance in terms of satisfying their economic

needs. It is important that they are satisfied with their overall pay as this may

impact their attitudes and behaviors. According to equity theory, pay satisfaction

is based on perceptual and comparative processes (Adams, 1963; Lawler, 1990;

18
Lum et al., 1998). Equity theorists posit that employees seek the equilibrium

between what they invest or put into their jobs in terms of effort, knowledge and

skills, and what they get as an outcome through compensation or recognition

(Adams, 1963; Greenberg, 1987, 1990; Milkovich and Newman, 2008). Lawler

(1971) further suggests that satisfaction or dissatisfaction with pay is influenced

by the discrepancy between what employees perceive they should receive for their

inputs (or their pay) and what they contribute to the organization. It can also be

seen as a surrogate for fairness and justice, which in return has a direct impact on

employees’ motivation and therefore their job satisfaction. The review of

satisfaction with pay shows considerable advances that have been made.

However, little attention has been given to exploring the potential consequences

of pay satisfaction (Huber, Seybolt, & Veneman, 1992; Judge, 1993; Lucero &

Allen, 1994). This oversight is in part due to the lack of a conceptual model to

guide research (Heneman, 1985; Heneman & Judge, 2000; Judge & Welbourne,

1994). Since the previous models of pay satisfaction offer no theoretical basis for

differential impact on consequences the dimensions of pay satisfaction will have,

it is necessary to rely on research from other areas.

Competitive Pay

Competitive Pay on the other hand, is “a natural way to motivate workers

at any level is to offer them financial incentives; linking pay to performance

improves the motivation value of money (Kinicki and Kreitner, 2016)”. Many

jobs require financial rewards to motivate employees and many people primarily

work to make money or attain the recognition denoted by financial rewards

19
(Giancola, 2011). For this reason, it is important to formulate acceptable and

better compensation strategies in order to enhance and increase employee

motivation and uplifting their morale and have a positive attitude towards work

hence high productivity which results to a highly competitive advantage.

Competitive Benefits Package

Competitive benefits package is one of the strategies in employee

motivation and employee productivity. According to Max Messmer (2006) “an

attractive benefits package can often make the difference in recruiting and

retaining employees. As a result, many companies are reassessing their offerings”.

Some options to consider including in benefits package are offering more flexible

schedules, support family needs and fund education. Offering attractive benefits

doesn’t have to break the budget. Many of the most desirable options, such as

flexible work schedules, have minimal to no associated costs. In the study of

Elizabeth (2017), it shows that majority of the employees do not think that the

benefits package offered by the organization is not competitive. Indeed, it is

through the benefits of unique and specific best practices that competitive

advantage may be realized.

Monthly Expense Allowance

In the study of Sreenath, S., Mohan, P. A., & Lavanya, M. P. (2019), A

point of suggestion was that spectacle monthly expense allowance can add more

motivation to the employees. Moreover, benefits need to be kept flexible and it

has to be reviewed from time to time. Many organizations, as a matter of practice

20
have accommodated travel benefit/expenses or can be called as business trip

which includes airfares, train travel bookings, hotel stays, outstation allowance

and travel insurance. Moreover, the flexible benefits which are given to the

employees are considered more valuable because it acts as greater advantage for

employees in saving that part of expenditure and help employees to focus on their

job without financial worries.

Monetary Rewards

Lazear (1986) positively suggests that by adding financial rewards to the

compensation of employee for the sake of motivation can attract more geared

workers to the organization. By other point of view, Lazear (2000) also described

that introduction of monetary rewards could gain extra efforts of the employee to

that extent where the marginal value added is equal to the marginal cost paid for

that additional work. This shows that financial incentives are some types of paid

value to employees in return for their extra efforts. Lazear (2000) showed a

positive relation between employee engagement and rewards and firm’s

productivity.

Money as an Incentive

One of the best-known authors to address the motivational area studies

was the American psychologist A. Maslow who has identified the five levels

hierarchy of human needs (Hersey, Blanchard & Johnson, 1996). His work was

then enriched by other researchers like F. Hertzberg, who developed the

motivator-hygiene theory, where he posited the main factors contributing to work

21
satisfaction or dissatisfaction. According to his studies there are “two factors

central to our understanding and motivation” (Beardwell & Claydon, 2007):

motivators (e.g. recognition, skills development, responsibility, performance)

whom achievement produces satisfaction and hygiene factors (e.g. working

conditions, wages, management) which, if met with the employee’s needs, could

only prevent them from becoming dissatisfied. This theory highlights that money

is a hygienic factor, belonging to the job environment (Herzberg, 1987), and thus,

the use of money as an incentive can just determine the employees not to be

dissatisfied, but it is not enough for motivating them.

Salary Dissatisfaction

Pay has been considered an important reward to motivate the behavior of

employees (Taylor and Vest, 1992). All other behavioral factors are important for

enhancing job satisfaction of employees but satisfaction from pay is must. Katzell

(1964) stated that pay satisfaction depends on the difference between perceived

pay and the amount of pay a person feels should be received. Salary satisfaction is

a much narrower construct than job satisfaction. However, pay satisfaction is also

an important variable that is linked to some rather significant organizational

outcomes. For example, some evidence suggests that dissatisfaction with pay may

lead to decreased job satisfaction, decreased motivation and performance,

increased absenteeism and turnover intensions, and more pay related grievances

and lawsuits. Pay satisfaction has been shown to influence overall job satisfaction,

motivation and performance, absenteeism and turnover intensions, and may be

related to pay-related grievances and lawsuits (Cable and Judge, 1994).

22
 Less pay as compared to work done is one of those extrinsic factors which

is responsible for job dissatisfaction (Robbins, 2003). Yang, Miao, Zhu, Sun, Liu

and Wu (2008) suggested that, in Chinese forces it is considered that pay and

satisfaction influence each other. Pay has direct influence on satisfaction level of

employee. NL (2012) described that pay is one of those satisfying variables which

hindered reduces the dissatisfaction level of employees.

Value on Services

As stated by Saleem (2011), “employees stay in an organization because

the benefits of being part of an organization far outweigh the cost of leaving the

organization”. The fact that employees fear losing their job makes money an

extremely effective motivator because it is indispensable for survival in an

economy (Cole, 2000). Therefore, employees that are satisfied with financial

incentives and rewards given by firms will value their services more.

Attract and Retain Employees

Milkovich & Newman (2008) said that, “the Most important human

resource management issue nowadays is rewards structure”. But due to global

competition and environmental uncertainty most employers have shifted from

traditional way of rewards structure and design them on the basis of performance,

skills knowledge and competency (Lawler, 2000) which attracts, retains and

motivates talented employees to achieve their objectives (Milkovich & Newman,

2008). Their proper implementation results in improved employee satisfaction,

increased teamwork and motivation and employee’s productivity (Drucker &

23
White, 2000). The empirical results of the administration of benefits showed

positive association between employee’s commitment and financial incentives

and rewards.

Profit Sharing

Recently there has been a strong growth of interest in profit sharing and

related forms of pay for group performance. Many reasons undoubtedly exist fir

this heightened attention. The primary motive probably has to do with the

perception that by giving workers a partial stake in their company's performance,

profit sharing may, under certain circumstances, lead to desirable outcomes that

ultimately increase productivity. If this perception contains an element of truth,

widespread profit sharing might conceivably improve national "competitiveness",

with consequent policy implications. In such a context, but also for more general

reasons, it becomes important to sort out and evaluate as systematically as

possible the evidence on a possible link between profit sharing and productivity.

(Weitzman, & Kruse, (1990).

Previous studies have shown that financial incentives and its monetary

factors affects employee motivation and productivity, and for this understanding,

it is important to channel employee motivation towards the accomplishment of the

organization’s vision or goals. A poorly motivated employees will be expensive to

the organization in terms of decreased productivity and performance, excessive

staff turnover, increased expenses, higher use of the manager’s time and a

negative effect on the morale of colleagues (Jobber and Lee, 1994). Companies

need to ensure that their employees are highly productive and motivated. As a

24
result, they try to improve the productivity of their employee through better

motivation, financial incentives, rewards and recognition. Of these, financial

incentive, recognition or reward schemes play an important role in motivating

employees to perform better (Abratt and Klein 1999).

25
 CHAPTER III

RESEARCH METHODOLOGY

This chapter includes the research method, setting of the study, respondents of the

study, research instrument, validity and reliability, ethical consideration of the study,

sampling procedure, data gathering procedure and statistical treatment that were used in

the study.

Research Method

This study used the descriptive-survey method of research in quantitative

approach. Questionnaires were used as instruments of data collection and data were

statistically treated to achieve the primary objective of the study.

Research Environment

The study was located at Sardines Martinez Village, 7100 Dipolog City where

Montaño Foods Corporation main branch located.

Back in 1975, Mr. Nick Montaño started a single proprietorship that produces

bottled sardines in different variants. The firm was incorporated and named Montaño

Foods Corporation (MFC) in 1995. Before DOST's intervention, MFC only produced 10-

20 cases of bottled sardines every month. But after availing of the first phase of

interventions, the firm increased its production capacity significantly. With a SETUP-

ISSF assistance amounting to Php 985,899 and technology trainings and consultancies,

the firm became a popular pasalubong brand in Dipolog City. On the second phase of

interventions, another Php 1.9 million worth of financial assistance enabled the firm to

acquire new technologies that further improved production efficiency and product
quality. Since then, MFC generated a total of 75 local employments and maintains a pool

of on-call workers especially for the peak season. Being an EU HACCP certified

company, it was able to penetrate the export market and is now a multi-million enterprise.

In 2014 alone, the firm produced 1,253 cases of sardines and recorded a total gross sale

of Php 2,025,420.00.

Figure 2. Map of Montaño Foods Corporation

The researchers chose the Montaño Foods Corporation, because they believe that

the Montaño Foods Corporation have enough employees to conduct the research.

Research Respondents

The respondents of this study are all 92 production employees in the Montaño

Foods Corporation, Dipolog City. The said 92 production employees was given by the

HR manager of Montaño Foods Corporation.

27
Research Instruments

This study adopted a modified standardized questionnaire. There are 3 (three)

parts of questionnaires in this study. The first part of questions determined the

employees’ profile: age, sex, civil status, educational achievement, and number of years

of employment. The second part of questionnaires utilized to get the assessment of the

employees regarding the financial incentives offered and how it affects their productivity.

The items on questionnaire of both sets are based on the questionnaire from the study of

Waiyaki (2017). Further, the third part of the questionnaire was from the study of Alam,

Hassan, and Reaz (2020) that assessed the employee productivity. The first part of the

questionnaire collected demographic data of the respondents such as age, sex, civil status,

educational attainment and number of years employed. The second part was concerned

with the relationship between financial incentives/monetary factors and employee

productivity. There were five multiple choice options representing five levels of

preference, that is; strongly disagree, disagree, neither agree or disagree, agree, strongly

agree. The third part of the questionnaire looks at the level of employees’ productivity

with five preferences indicated, that is; strongly disagree, disagree, neither agree or

disagree, agree, strongly agree.

28
Scoring Procedure

Likert 5-Point Scale

Scale Range Descriptive Rating Interpretation

1 1.00 – 1.80 Strongly Disagree This rating is given to the
statements where the
employees are strongly agreed
with the skill stated.
2 1.81 – 2.60 Disagree This rating is given to the
statements where the
employees disagreed with the
skill stated.
3 2.61 – 3.40 Neutral This rating is given to the
statements where the
employees are being neutral
with the skill stated.
4 3.41 – 4.20 Agree This rating is given to the
statements where the
employees are agreed with the
skill stated.
5 4.20 – 5.00 Strongly Agree This rating is given to the
statements where the
employees are strongly agreed
with the skill stated.

Ethical Considerations

The researchers ensure that the respondents freely and voluntarily participate in

this study while it is being conducted. Prior to conducting the survey, the researchers first

obtained the permission from the owner of Montaño Foods Corporation. Furthermore,

29
prior to the distribution of the questionnaire, the respondents' full consent was obtained.

Also, the researcher assures the safety and privacy of research participants, as well as a

sufficient level of confidentiality of research data. Finally, the confidentiality of those

who take part in the study are guaranteed.

Data Gathering Procedure

Before conducting the study, the researchers asked permission first to the

Montaño Foods Corporation if we’re allowed to conduct the study. After the management

allows, the researchers send letter of permission to the owner of Montaño Foods

Corporation via email as their acting manager Mr. Bryan Debarra who the researchers

spoke to and also, after the Board of Panels approves the instrument to be used in data

collection. After the researchers received authorization to collect data, they physically

visit Montaño and give the questionnaires to the security guard as per Mr. Debarra’s

advised. Following the survey, the researcher tabulated the data collected and transmitted

the data to a statistician for statistical treatment.

Statistical Treatment of Data

The following statistical tools were used to interpret the data gathered:

1. Frequency Distribution and Percentage Distribution computation was used to

determine the profile of the respondents in terms of age, sex, civil status,

educational attainment and number of years employed. The formula is

Percent = (Frequency/Number of Case) x 100

30
2. Weighted Mean was used to identify the employee’s rating on motivation in

terms of financial incentives/monetary factors. Also, to determine the rating of

employees toward productivity in the company. The formula is

Weighted Mean = ( data interval frequency x assigned weight )

Total respondents

3. Spearman Rank-order Correlation Coefficient was used to test the significant

relationship between employee motivation and employee productivity. The

formula is

where di = difference in paired ranks and  n = number of cases.

4. The level of productivity of the employees’ data are analyzed according to their

profile with the aid of the non-parametric Kruskal Wallis H and Mann-Whitney

U tests. The formula is:

31
 CHAPTER IV

PRESENTATION, ANALYSIS, AND INTERPRETATION OF DATA

This chapter includes the statements of the respondents to answer the current

investigation's statement. The responses of the respondents were statistically treated to

address the precise statement of the problem outlined in Chapter 1.

Table 1. Profile of the Employees in Montaño Foods Corporation in Terms of Age

Age Frequency Percent

25 and below 5 5.43

26-30 15 16.30

31-35 17 18.48

36-40 23 25.00

41 and above 32 34.78

Total 92 100.0

Table 1 presents the frequency count and percentage distribution of the employees

in Montaño Foods Corporation in terms of age. As presented in the table, a total of 32 or

34.78 percent of the employees in Montaño Foods Corporation belongs to 41 years old

and above. Furthermore, 23 or 25.00 percent of them with ages ranging from 36 – 40

years old, 17 or 18.48 of them are within the age bracket between 31 to 35 years old, 15

or 16.30 percent of them within the age range of 26 to 30 years old, and 5 or 5.43 of them

are within the age range of 25 years old and below of the total population.
 This means that most of the employees in Montaño Foods Corporation are in the

age range of 41 years old and above. This can be inferred that a lot of employees who are

working in the company are already matured and stayed in the corporation for so long

years. This can be supported in Table 5 in which most of the employees served more than

10 years in the corporation.

Table 2. Profile of the Employees in Montaño Foods Corporation in Terms of Sex

Sex Frequency Percent

Male 19 20.65

Female 73 79.35

Total 92 100.00

Table 2 shows the frequency count and percentage distribution of the profile of

the employees in Montaño Foods Corporation in terms of sex. As shown in the table, a

total of 73 or 79.35 percent of the employees are female. Furthermore, it can be seen that

only 19 or 20.65 percent of them are male employees in Montaño Foods Corporation.

This can be implied that a majority of the employees are female-dominated as compared

to their male counterparts. Therefore, there are more female employees working in the

Montaño Foods Corporation.

33
Table 3. Profile of the Employees in Montaño Foods Corporation in Terms of Civil
Status

Civil Status Frequency Percent

Single 21 22.83

Married 69 75.00

Widow 2 2.17

Total 92 100.00

Table 3 portrays the profile of the employees in Montaño Foods Corporation in

terms of their civil status. As portrayed in the table, the data revealed that a total of 69 or

75.00 percent of the employees are married in Montaño Foods Corporation. It can be seen

also that there is 21 or 22.83 percent of them are single, and 2 or 2.17 percent of them are

widowed respectively. This means that a majority of the employees in Montaño Foods

Corporation are dominated by married individuals.

Table 4. Profile of the Employees in Montaño Foods Corporation in Terms of

Educational Attainment

Educational Attainment Frequency Percent

Elementary 3 3.26

High School 71 77.17

College 18 19.57

Total 92 100.00

34
 Table 4 reflects the profile of the employees in Montaño Foods Corporation in

terms of educational attainment. As reflected in the table, data revealed that a total of 71

or 77.17 percent of the employees were in high school, 18 or 19.57 percent of them are

college highest educational attainment, and 3 or 3.26 percent of them belong to the

elementary category. The findings implied that the majority of the employees in Montaño

Foods Corporation are high school during the conduct of the study.

Table 5. Profile of the Employees in Montaño Foods Corporation in Terms of

Number of Years Employed.

Number of Years Frequency Percent

Less than 1 year 5 5.43

3 to 5 years 48 52.17

6 to 10 years 16 17.39

Above 10 years 23 25.00

Total 92 100.00

Table 5 displays the profile of the employees of Montaño Foods Corporation in

terms of the number of years employed. As displayed in the table, a total of 48 or 52.17

percent of the employees have a number of years of about 3 to 5 years employed in

Montaño Foods Corporation. It can be gleaned further that 23 or 25.00 percent are

working for above 10 years, 16 or 17.39 percent of them are within 6 to 10 years of the

service, and 5 or 5.43 percent of them are less than 1 year working. This can be implied

that a majority of the employees are within 3 to 5 years working employed in Montaño

Foods Corporation.

35
Table 6. Employees’ Rating on Their Motivation in Terms of Financial

Incentives/Monetary Factors.

Motivations Weighted
Verbal Description
Mean
I am satisfied with the level of pay I receive 4.43 Strongly Agree
The pay offered by the company is very
competitive compared to other companies in 4.33 Strongly Agree
the industry
Our company maintains a competitive pay
and benefits (e.g., medical insurance) 4.40 Strongly Agree
package
I would be satisfied if I received a monthly
4.45 Strongly Agree
expense (e.g., fuel and telephone) allowance
Our company uses monetary rewards like
base pay, commission, bonus, incentives and 4.34 Strongly Agree
healthy allowances to motivate us
I believe that money is a crucial incentive to
work motivation because it is what I use to 4.36 Strongly Agree
purchase the things I need and desire
My salary and other hygiene factors (e.g.,
company policies, working conditions,
3.07 Neutral
supervision) have led to a dis-satisfaction of
my employment
I believe the money I am paid is a strong
indication of the value the organization has 4.21 Strongly Agree
placed on my services
Our company pay policy helps attract and
4.33 Strongly Agree
retain high performing employees

36
 If the company had a profit-sharing scheme,
4.49 Strongly Agree
it would motivate me to perform
Overall Mean 4.24 Strongly Agree

Table 6 presents the employees’ rating on their motivation in terms of financial

incentives/monetary factors in Montaño Foods Corporation. As presented in the table, the

employee rate as strongly agrees with the majority of the facets of the motivation in terms

of financial incentives/monetary factors with an overall weighted mean value of 4.24.

This can be implied that the employees were highly motivated to perform their tasks if

the company had a profit-sharing scheme for their employees. Ismail, et al., (2009)

corroborated the present findings which revealed that firms must develop strategies that

include financial incentives and rewards that would enhance the employment relationship

as it creates the basis of commitment. This includes extrinsic motivations like promotion,

bonus, profit sharing or gain sharing, and employee stock ownership.

This can be implied further that the employees were satisfied if they would be

given a monthly expense (e.g., fuel and telephone) allowance, satisfied with the salary

they received, and the company maintains a competitive pay and benefits (e.g. medical

insurance) package. It can be gleaned from the table that the employees believe that

money is a crucial incentive to work motivation because it is what they use to purchase

the things they need and desire. Moreover, the employees are highly motivated by the

company which uses monetary rewards like base pay, commission, bonus, incentives, and

healthy allowances.

It can be deduced further that the employees were motivated due to each

company's pay policy helping attract and retain high-performing employees and also the

37
pay offered by the company is very competitive compared to other companies in the

industry. The study by McChilloh, (2001) corroborated the present finding which stresses

that financial incentive has a strong motivational effect on employees if they value it if

they believe good performance is instrumental in bringing the desired reward and if they

expect their efforts will achieve the desired performance.

Table 7. Employees’ Perception on the Level of Productivity in the Company

Statements Weighted Mean Verbal Description

I usually complete my work on time 4.30 Strongly Agree

I can find creative solutions to my work‐
4.14 Agree
related problems.
I am satisfied with the quantity of output
4.29 Strongly Agree
that I produce.
The production target of my company is
4.41 Strongly Agree
achievable for me.
I do my work without wastage of raw
4.24 Strongly Agree
materials.
I prefer to work attentively without
4.11 Agree
gossiping with others. 
I am satisfied with the quality of my
4.34 Strongly Agree
work output
I can meet the technical requirements of
4.30 Strongly Agree
the work process.
Overall Mean 4.27 Strongly Agree

Table 7 shows the employee’s perception of the level of productivity given by the

Montaño Foods Corporation. As shown in the table, the employees perceived as strongly

agree with some aspects of the level of productivity in Montaño Foods Corporation with

an overall weighted mean value of 4.27. This means that the employees strongly agreed

38
that the production target of their company is achievable for them as workers in Montaño

Foods Corporation.

This can be concluded that the employees are strongly agreed with the level of

productivity, particularly in the quality of work output they have, and they can meet the

technical requirements of the work process. It can be seen further that the employees

finished their work on time, they do their work without wastage of raw materials, and

also, they are satisfied with the quantity of output that they produce.

This can be implied that the employees are highly productive workers in the

Montaño Foods Corporation. Thus, the workplace of Montaño is fully ambiance to the

employees, and the relationship with them the Montaño staff was good. This is because

the employees are highly motivated by the services and the monetary and financial

factors in Montaño Foods Corporation thus, highly productive outputs are expected.

Aktar et al., 2012; Kawara, 2014; Scott, 2015; Swart 2010 supported this finding

stressing that many scholars noted that motivation of employees and effective

management play significant roles in boosting their productivity and organizational

performance.

Table 8. Test of Significant Difference in the Level of Productivity of the Employees

When the Data are Analyzed According to Profile.

Profile Test Statistics p-

Decision Interpretation
H test U test value
Age 12.729 - 0.013 Reject Ho Significant
Sex 427.0
- 0.009 Reject Ho Significant
0
Civil Status 6.329 - 0.042 Reject Ho Significant
Educational Attainment Fail to Not
1.808 - 0.405
Reject Ho Significant
Number of Years of 3.284 - 0.350 Fail to Not

39
 Employment Reject Ho Significant
Level of significance alpha at 0.05: U – test – Mann- Whitney U: H test – Kruskal Wallis Test

Table 8 presents the test of significant difference in the level of productivity of the

employees when analyzed according to their profile. As presented in the table, the data

were analyzed with the aid of the non-parametric Kruskal Wallis H and Mann-Whitney U

tests. As reflected in the table, the data along age profile garnered an H test value of

12.729, the civil status with an H test value of 6.329, and the sex profile with an U test

value of 427.00 of which all of their p-values are less than the level of significance alpha

of 0.05. Thus, the decision is to reject the null hypothesis in te level of productivity of the

employees along with their profiles age, sex, and civil status. The rejection of the null

hypothesis means there was a significant difference along with age, sex, and civil status

of employees when analyzed as to their level of productivity. According to Mison and

Bernabe, (2004) there are personal characteristics that affects employee’s performance

such as age, sex, marital status, and tenure. The relationship between age and work

productivity may be an issue of increasing importance during the next decade. There is a

widespread belief that work productivity declines with increasing age. With age and

experience come a variety of benefits including, for many, enhanced self-esteem.

Reviewing a range of studies on the subject, Tim Khlai (2006) reports, “All studies show

positive shifts occurring in the middle years, particularly between ages 40 and 50.” Tim

Khlai (2006) also added that certain studies on sex and productivity noted that women’s

productivity is not lower than men’s, given that women’s jobs are often inferior in terms

of pay, autonomy, and promotional opportunity. Using the data set on the work

orientation from the 1997 International Social Survey Program, showed that in most

countries, women were actually less satisfied than men, whereas in Great Britain, and

40
United States, women had much higher job satisfaction levels than men among at least 21

countries. Additionally, Seung-min and Mustafa (2002) said that married male workers

earn more than their unmarried co-workers is now well established in the labor

economics literature. Traditional estimates of this marriage premium range from 10 to 40

percent. However, the source of this wage difference between married and unmarried

men remains obscure. Some economists attribute this wage differential to differences in

job productivity between married and single workers. Other economists attribute the

wage differential to unobserved characteristics of married workers, i.e., selection effects.

Table 9. Test of Significant Relationship Between Financial Incentives/ Monetary

Factors and Employee Productivity

Variables Correlated
Rho p- Strength of
Financial Decision Interpretation
value value Relationship
Incentives
Employee Negligible Fail to
Not
Productivity 0.163 0.120 positive Reject
Significant
relationship Ho
Level of significance alpha at 0.05: U – test – Mann- Whitney U: H test – Kruskal Wallis Test

Table 8 shows the test of significant relationship between financial incentives/

monetary factors and employee productivity of Montaño Foods Corporation. As depicted

in the table, the data were analyzed with the aid of a non-parametric Spearman rho value.

It can be seen from the table that the rho value is 0.163 with a p-value of 0.120 which is

larger than the level of significance alpha of 0.05. Thus, the decision is not to reject the

null hypothesis. Therefore, the non-rejection of the null hypothesis means there was no

significant relationship between financial incentives/ monetary factors and employee

41
productivity. In this study, it can be implied that the monetary factors did not show any

influence on the level of productivity of the employees in Montaño Foods Corporation.

This can be deduced that the data did not provide sufficient evidence to conclude that the

financial incentives/ monetary factors relate to the employee's productivity. This was

supported by the study of Kibet, (2020), employee benefits may motivate employees to

work harder, but those efforts may not result in increased productivity if the employee

lacks the necessary skills. When, in certain cases, employees lack the necessary skills to

complete their tasks, and monetary incentives only increase certain aspects of effort but

not productivity However, the study by Bhuvanaiah and Raya, (2015) contradicts the

findings which posit that employee motivation affects productivity, and for this

understanding, it is important to channel employee motivation towards the

accomplishment of the organization’s vision or goals.

According to (Omollo, 2015), motivation is the key to a successful organization to

maintain the continuity of the work powerfully and help organizations to survive.

Motivation word is derived from “Motive”. The meaning of “motive” is the needs, wants,

and desires of the person. So “employee motivation means the process in which an

organization inspires our employees with the shape of rewards, bonuses, etc. for

achieving the organizational goals (Chaudhary & Sharma, 2012).

42
 CHAPTER V

SUMMARY, FINDINGS, CONCLUSION AND RECOMMENDATIONS

Summary

The main purpose of this study was to examine the relationship between financial

incentives and employee productivity in Montaño Foods Corporation. This study was

sought to answer the following: What is the profile of the employees in Montaño Foods

Corporation? How do the employees rate the financial incentives/monetary factors? How

do the employees perceived their level of productivity in the company? Is there a

significant difference on the employee productivity when analyze according to the

respondent’s profile? And, is there a significant relationship between employees’

financial incentives/monetary factors and employee productivity in Montano Foods

Corporation in Dipolog City?

A descriptive research design was adopted with Montaño Sardines being the focus

organization. The population of this study comprised of all the 92 production employees

of Montaño Foods Corporation. Primary data for the study was collected using

standardized questionnaire. Weighted mean, Spearman Rank-order correlation coefficient

and Non-parametric Kruskal Wallis H and Mann-Whitney U tests was used to facilitate

data analysis.
Findings

1. Majority of the respondents were between the ages of 41 and above, with more

than half of them being female, married, high school level/graduate, and mostly

had already worked for 3-5 years.

2. Majority of Montaño Foods Corporation employees highly agree with the

motivation in terms of financial/monetary aspects. Among all financial incentives,

profit-sharing scheme has the highest weighted mean value of 4.49 resulting as

strongly agree, and salary and other hygiene factors has the lowest weighted mean

value of 3.07 resulting as neutral.

3. Employees are highly satisfied with their level of productivity, particularly the

quality of their job output, and they can match the technical criteria of the work

process, according to the survey. It can also be seen that the production target is

achievable to most of the employees with the weighted mean valued of 4.41,

while working attentively without gossiping has the lowest weighted mean value

of 4.11.

4. According to the test of significant difference in the level of productivity of the

employees when data are analyzed according to the profile, the decision is to

reject the null hypothesis in the level of productivity of the employees along with

their profiles age, sex, and civil status. On the other hand, null hypothesis is

accepted in terms of respondents’ educational attainment and number of years of

employment.

5. In the test of significant relationship between financial incentives/ monetary

factors and employee productivity, the analysis indicated that the null hypothesis

44
 was not rejected. It is implying that there was no significant relationship between

financial incentives/ monetary factors and productivity.

Conclusion

Based from the result on the employees’ rating on their motivation in terms of

financial incentives/monetary factors, majority of the financial incentives/ monetary

factors have been strongly agreed on with the employees. It is then concluded that

employees are motivated with the financial incentives provided by the organization.

The respondents mostly strongly agreed with some aspects of the level of

productivity in the test of employees’ perception on the level of productivity in the

company. This can be concluded that the employees are strongly agreed with the level of

productivity, particularly in the quality of work output they have, and they can meet the

technical requirements of the work process.

The study came to the further conclusion that of all profiling markers, age, sex,

and civil status rejected the null hypothesis. This means that whether on what sex, age,

and marital status, it displayed a significant difference as to their level of productivity as

compared to other categorized profile respectively.

The study also conclude that the null hypothesis is not rejected in the test of

significant relationship between financial incentives/ monetary factors and employee

productivity. It can be concluded that motivating factors had no effect on the level of

productivity of Montaño Foods Corporation personnel which means that the data did not

provide enough information to determine that the employee's motivation is related to

45
productivity. The relationship may be found on the other variables of motivation like

goal-setting, recognition, and rewards.

Recommendations

Management

1. It is recommended that the management should reassess its salary and benefits

package, enhance their pay policy and develop financial incentives and

rewards that would improve employment productivity.

2. The company management should re-evaluate the current services and

monetary programs, and also get feedback plus buy-in from the employees on

how to make it fair and equitable for all.

Employees

1. Employees should assess the benefits that the company offers to ensure job

satisfaction and increase motivation and employment productivity.

2. Give feedback to the company regarding the benefit packages offered to

improve employee motivation and productivity.

Future Researchers

1. Future researchers should examine the constructs used in this study in order to

gain better insights on the relationship of employee motivation and employee

productivity with regards to financial incentives.

46
2. Fture researchers should explore more motivational factors as this study only

focus on financial/monetary factors which results to non-rejection of null

hypothesis.

47
 REFERENCES

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APPENDICES
 Appendix C
The Questionnaire for Employees
The general objective of this study is to determine the relationship of motivation and

employee's productivity in an organization. The study will focus on the bottled sardines

in Dipolog City. The following questionnaire has been developed to help the researcher

gather information necessary to answer the research questions of the study. Kindly fill it

appropriately.

Name (optional): _______________________________________________________

PART 1: Demographics
Age:
25 and below [ ] 26-30 [ ] 31-35[ ] 36-40 [ ] 41 and above [ ]
Sex:
Male [ ] Female [ ]
Civil Status:
Single [ ] Married [ ] Widow [ ]
Educational Attainment:
Elementary [ ] High School [ ] College [ ]
Number of Years Employed: How long have you worked at Montaño Foods
Corporation?
Less than 1 Yr. [ ] 3-5 Yrs. [ ] 6-10 Yrs. [ ] 10 Yrs. and above
[]
PART 2: Financial Incentives/ Monetary Factors
1. The questions in this section concern characteristic related to financial
incentives/monetary factors and their relationship on employee productivity. Using the
key below, please indicate the extent to which you agree with each statement.
1= Strongly Disagree
2=Disagree
3=Neutral
4=Agree
5= Strongly Agree
Financial Incentives/ Monetary Factors 1 2 3 4 5
I am satisfied with the level of pay I receive
The pay offered by the company is very competitive compared to
other companies in the industry
Our company maintains a competitive pay and benefits (e.g. medical
insurance) package
I would be satisfied if I received a monthly expense (e.g., fuel and
telephone) allowance
Our company uses monetary rewards like base pay, commission,
bonus, incentives and healthy allowances to motivate us
I believe that money is a crucial incentive to work motivation because
it is what I use to purchase the things I need and desire
My salary and other hygiene factors (e.g., company policies, working
conditions, supervision) have led to a dis-satisfaction of my
employment
I believe the money I am paid is a strong indication of the value the
organization has placed on my services
Our company pay policy helps attract and retain high performing
employees
 If the company had a profit-sharing scheme, it would motivate me to
perform

PART 3: Employee Productivity

2. The questions in this section concern characteristics related to employee productivity.
Using the key below, please indicate the extent to which you agree with each statement.
1= Strongly Disagree
2=Disagree
3=Neutral
4=Agree
5= Strongly Agree

Employee Productivity 1 2 3 4 5
I usually complete my work on time
I can find creative solutions to my work‐related problems.
I am satisfied with the quantity of output that I produce.
The production target of my company is achievable for me.
I do my work without wastage of raw materials.
I prefer to work attentively without gossiping with others. 
I am satisfied with the quality of my work output
I can meet the technical requirements of the work process.
 CURRICULUM VITAE

Name: Lovely Jayne P. Duran

Address: Pres. M. A. Roxas, Zamboanga del Norte
E-mail address: [email protected]
Contact Number: 09569388071

PERSONAL BACKGROUND
Nickname : Lovely
Age : 22
Birthdate : March 01, 2000
Citizenship : Filipino
Religion : Roman Catholic
Civil Status : Single
Mother’s Name : Rosevilla P. Duran
Father’s Name: Jose Gerry L. Duran

EDUCATIONAL BACKGROUND
Elementary Education :Banbanan Elementary School
Address: Pres. M. A. Roxas, Zamboanga del Norte
Year Graduated: 2012 - 2013

Secondary Education: Langatian National High School

Address: Pres. M. A. Roxas, Zamboanga del Norte
Year Graduated: 2018 - 2019

Tertiary Education: Jose Rizal Memorial State University

Address: Dapitan City
Course: Bachelor of Science in Accountancy
Year Graduated:

Lovely Jayne P. Duran

I hereby certify to the correctness of the above-mentioned.
 (Signature over Printed Name)

CURRICULUM VITAE

Name: Dia Mae A. Generoso

Address: Kalawit, Zamboanga del Norte
E-mail address: [email protected]
Contact Number: 09534300320

PERSONAL BACKGROUND
Nickname : Ding
Age : 21
Birthdate : December 23, 2000
Citizenship : Filipino
Religion : Roman Catholic
Civil Status : Single
Mother’s Name : Diosa A. Generoso
Father’s Name: Apolinario A. Generoso

EDUCATIONAL BACKGROUND
Elementary Education :Batayan Elementary School
Address: Kalawit, Zamboanga del Norte
Year Graduated: 2012 - 2013

Secondary Education: Batayan National High School

Address: Kalawit, Zamboanga del Norte
Year Graduated: 2018 - 2019

Tertiary Education: Jose Rizal Memorial State University

Address: Dapitan City
Course: Bachelor of Science in Accountancy
Year Graduated:

Dia Mae A. Generoso

I hereby certify to the correctness of the above-mentioned.
 (Signature over Printed Name)

CURRICULUM VITAE

Name: Kae Alymar R. Quintero

Address: Pres. M. A. Roxas, Zamboanga del Norte
E-mail address: [email protected]
Contact Number: 09165519548

PERSONAL BACKGROUND
Nickname : Kae
Age : 21
Birthdate : February 21, 2001
Citizenship : Filipino
Religion : Roman Catholic
Civil Status : Single
Mother’s Name : Anamaria R. Quintero
Father’s Name: Ismael T. Quintero

EDUCATIONAL BACKGROUND
Elementary Education : Pongolan Elementary School
Address: Pres. M. A. Roxas, Zamboanga del Norte
Year Graduated: 2012 - 2013

Secondary Education: Langatian National High School

Address: Pres. M. A. Roxas, Zamboanga del Norte
Year Graduated: 2018 - 2019

Tertiary Education: Jose Rizal Memorial State University

Address: Dapitan City
Course: Bachelor of Science in Accountancy
Year Graduated:

Kae Alymar R. Quintero

I hereby certify to the correctness of the above-mentioned.
 (Signature over Printed Name)

CURRICULUM VITAE

Name: Noven D. Romasasa

Address: Pres. M. A. Roxas, Zamboanga del Norte
E-mail address: [email protected]
Contact Number: 09122855691

PERSONAL BACKGROUND
Nickname : Noy
Age : 21
Birthdate : November 17, 2000
Citizenship : Filipino
Religion : Roman Catholic
Civil Status : Single
Mother’s Name : Maria D. Romasasa
Father’s Name: Jaime G. Romasasa

EDUCATIONAL BACKGROUND
Elementary Education:Roxas Central School
Address: Pres. M. A. Roxas, Zamboanga del Norte
Year Graduated: 2012 - 2013

Secondary Education: Langatian National High School

Address: Pres. M. A. Roxas, Zamboanga del Norte
Year Graduated: 2018 - 2019

Tertiary Education: Jose Rizal Memorial State University

Address: Dapitan City
Course: Bachelor of Science in Accountancy
Year Graduated:

Noven D. Romasasa
I hereby certify to the correctness of the above-mentioned.
(Signature over Printed Name)