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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.
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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 to
the 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 shortterm 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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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.
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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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 certain
duties 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.
Impact Factor (JCC): 4.9135
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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 of
working 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 and
their 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
Impact Factor (JCC): 4.9135
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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 services
provided 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.
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Temporary
Employees
30
16
46
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
Category
Teaching staff
Non-teaching staff
Total
Population
Permanent Temporary
58
30
140
16
198
46
Sample Size
Permanent Temporary
16
15
25
14
41
29
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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:
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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.
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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
Impact Factor (JCC): 4.9135
33
permanent basis agreed that their supervisor was a permanent employee of Kabarak university (mean = 4.18, SD = 1.189),
the ones on temporary basis remained neutral on this issue (mean = 3.24, SD = 1.615). Both the permanent (mean = 2.05,
SD = 1.538) and the temporary (mean = 1.72, SD = 1.308) respondents disagreed to the notion that the university pays
their over time. Both the employees in temporary and permanent disagree that their work is seasonal. It can therefore be
said that the University does not offer short term employment contract because the work is seasonal. The University uses
short term contracting of employment for the reasons of outsourcing agents provides their working equipments, pays for
their employees salaries, do specialized work and to some extent supervise their employees. However, it was found out that
the temporary as well as the permanent employees are not paid overtime. These findings concurs with Omolo (2012) who
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
Labour laws
When asked on a number of issues about the labour laws, the responses were as follows:
Those on permanent (mean = 2.08, SD = 1.365) and temporary (mean = 1.96, SD = 1.399) both disagreed that
they had worked more than three months on temporal. The permanent (mean = 3.92, SD = 1.201) and temporary
(mean = 4.36, SD = 0.700) both agreed that they had well written or well communicated contract. They both agreed that
they were contributor to NSSF and NHIF. They also both agreed that they received their wages/salaries as agreed in the
contract and that the services were terminated as agreed with the contact of employment. It can be concluded that Kabarak
University abound with the labour laws since there was disagreement that the employees worked for more than three
months on temporary basis. There was an agreement to the statutory deductions being made, these are the NHIF and NSSF.
Both categories of the employees agreed that they had formal contracts with the University and their compensation was
made as agreed in the contract. Both categories of the employees also agreed that the University terminated services of as
agreed upon in the contract of employment.
Short Term Contract
To find out if the short term contracting of employees was one type of employment engagement in Kabarak
University several issues were raised and responses as follows: The permanent respondents disagreed to the notion that
they were working on part time basis as they look for a full time job (mean = 2.08, SD = 1.244) while the temporary ones
agreed (mean = 3.76, SD = 1.405). The permanent ones disagree to the notion that they relieved/replaced employees on
maternity or other leaves for a period of time (mean = 2.05, SD = 1.395) while the ones on temporary basis did
(mean = 3.76, SD = 1.234). The permanent (mean = 2.46, SD = 1.295) and temporary (mean = 2.40, SD = 1.258) both
disagreed to the notion that their work arrangement offered them more free time to do other things. Whereas the permanent
respondents agreed to the fact that they were continuously being developed for more skills and competencies (mean = 4.00,
SD = 0.918), the ones on temporary basis did not agree (mean = 2.36, SD = 1.369). Both the permanent (mean = 1.28, SD
= 0.456) and temporary (mean = 2.12, SD = 1.536) disagreed to the fact that they chose the hours they want to be at the
work place but they both agreed that they interacted well with all employees at all levels. There was evidence of use of
short term contracting in the case of Kabarak University. Most of the temporary employees concur with the fact that they
were looking for full time employment as they worked on part time. They also agreed that they relieve full time employees.
They agreed that they had good working relations with the other employees of the university both of permanent basis and
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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 table below:
Table 5: Z -Test on Cost Reduction Strategy and Short Term Contracting
Terms of
Service
Permanent
Permanent
Mean of Cost
Reduction
=3.20
=2.34
SD
1 =1.298
2 =1.567
Sample
Size
n1=39
n2=25
Level of
Significance
2.559
0.05
Critical
(Table)
Value
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 H0 that 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 table as can be seen below:
Table 7
Permanent
Temporary
Mean of
Outsourcing of
Sevices
=3.23
=2.80
SD
Sample
Size
1 =1.175
2 =1.337
n1=39
n2=25
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Table 8
Z Test Value
1.927
Level of Significance
0.05
The z calculated was 1.927 while the table value was 1.64 at 0.05 level of significance. Since the calculated value
exceeds 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.
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36
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