OPEN ACCESS Research Journal of Business Management

ISSN 1819-1932
DOI: 10.3923/rjbm.2017.80.90

Research Article
Impact of Compensation and Benefits on Job Satisfaction
1
Calvin Mzwenhlanhla Mabaso and 2Bongani Innocent Dlamini

1
Department of Software Studies, Vaal University of Technology, Private Bag X021, 1900 Vanderbijlpark, South Africa
2
Department of Human Resources Management, Durban University of Technology, 19 Aberfedly Road, 3209 Scottsville, South Africa

Abstract
Background and Objective: Human capital is the pivotal of organisational effectiveness and the most valuable asset available to an
organisation is its people. Retaining employees in their jobs is crucial for any organisational productivity and competitiveness. The
shortage of academic staff and inability for higher Education Institutions to attract and retain highly qualified talent is a critical
phenomenon in tertiary education. Satisfaction of academic staff will increase productivity and increase research outputs for the
universities. The aim of the study was to investigate the impact of compensation, benefits on job satisfaction among academic staff in
higher education institutions in a South African context. There is paucity on research investigating specifically the relationship between
compensation, benefits and job satisfaction within the higher education institutions nationally. Materials and Methods: This study
employed the quantitative research method to investigate the influence of rewards on talent attraction and retention. An explanatory
hypothesis generating approach was employed and a survey design was used to collect data through a semi-structured questionnaire.
A sample of 279 academic staff, which was the total population of participants were selected for this study. Results: A positive and
significant effect of compensation on job satisfaction (p = 0.263). Moreover, there were no significant effect between benefits and job
satisfaction. Therefore, only compensation significantly predicted job satisfaction among academic staff. Conclusion: The practical
managerial implications that are attracting and retaining the new generation of lecturers into higher education institutions will require
substantially different skills and attractive employment offers than what the higher education institutions presently offer. Therefore, higher
education institutions must improve their compensation strategy in order to boost employees dedication that will enable commitment,
while efficiently deliver outstanding results. This will improve research outputs and improve skills within the country.

Key words: Compensate, job satisfaction, employee, relationship

Received: February 04, 2017 Accepted: March 03, 2017 Published: March 15, 2017

Citation: Calvin Mzwenhlanhla Mabaso and Bongani Innocent Dlamini, 2017. Impact of compensation and benefits on job satisfaction. Res. J. Business
Manage., 11: 80-90.

Corresponding Author: Calvin Mzwenhlanhla Mabaso, Department of Software Studies, Vaal University of Technology, Private Bag X021,
1900 Vanderbijlpark, South Africa Tel: +2716 950 6895

Copyright: © 2017 Calvin Mzwenhlanhla Mabaso and Bongani Innocent Dlamini. This is an open access article distributed under the terms of the creative
commons attribution License, which permits unrestricted use, distribution and reproduction in any medium, provided the original author and source are
credited.

Competing Interest: The authors have declared that no competing interest exists.

Data Availability: All relevant data are within the paper and its supporting information files.
 Res. J. Business Manage., 11 (2): 80-90, 2017

INTRODUCTION previous study seems to suggest that there is positive

relationship between compensation and job satisfaction.
In organization, employees are the key resources through Several studies have reported a positive relationship between
which all the other objectives are achieved. Academic staff are compensation and job9-11.
the employees of the educational organizations and their job Salisu et al.12 reported a significant positive correlation
satisfaction promotes teaching and learning. Employees will between compensation and job satisfaction and concluded
demonstrate pleasurable positive attitudes when they are the participants participating in their study regarded rewards
satisfied with their job1. Thus, high job satisfaction will as one of the main contributors to their job satisfaction.
increase the productivity of an organization, in turn increasing Nawab and Bhatti13 reported that employee rewards influence
the overall organizational performance. Compensation plays job satisfaction in higher education institutions. Nawab and
an important role in determining an employee's level of job Bhatti13 also revealed that compensation as part of employee
satisfaction. Reward practices linked to job satisfaction have rewards are gaining popularity day by day and higher
been applied differently by public and private enterprises. education institutions should use compensation to satisfy and
Higher education is influential in the development of a retain their highly qualified academic staff. In light of these
country, it does not only function as a provider of knowledge studies, this study seeks to find the correlation between
but as a pertinent sector for the nation s grown and societal compensation, benefits and job satisfaction.
well-being. The higher education institutions play a significant
role in development of skills, increased economy, therefore, Research purpose and objectives: There is paucity on
high quality of staff is required. Management at modern-day research investigating specifically the relationship between
academic institutions requires special endeavours to acquire compensation, benefits and job satisfaction within the higher
and retain highly skilled employees to operate effectively in an education institutions nationally. The main objective of the
extremely competitive environment. Obviously, the level of study was to determine the impact of compensation, benefits
job satisfaction of these individual employees will impact on job satisfaction among academic staff in higher education
significantly on performance at these institutions. institutions in a South African context. World at Work Total
Compensation is a useful instrument in the hand of the Rewards model was used in this study and the following study
management to contribute to the organisational effectiveness questions were investigated:
and can impact positively on the behaviour and productivity
of employees2. However, compensation determines the • What is the relationship between compensation and job
attraction and retention of employees to attain organisation satisfaction?
2,3 4
objectives . Adeoye and Fields attested that compensation • What is the relationship between benefits and job
is a major factor in attracting and retaining staff. To attract, satisfaction?
retain and be profitable, organisations need innovative reward • Does compensation and benefit impact on job
systems that satisfy employees. Netswera et al.5 stated that satisfaction?
unfavorable working conditions and unattractive
remuneration packages have in most industries led to skills Compensation: Pay provided by an employer to its employees
migration. Numerous researchers forecast that talent for services rendered (i.e., time, effort and skill). This includes
shortages are going to increase well into the next decade, both fixed and variable pay tied to performance levels14.
which will limit the ability of organisations to expand and will Swanepoel et al.15 stated that compensation as financial
jeopardize their chances of survival as global competition and non-financial extrinsic rewards provided by an employer
becomes more intense6,7. for the time, skills and efforts made available by the employee
Compensation play a vital role in attracting, motivating in fulfilling job requirements aimed at achieving
and retaining talented employees. According to Ibrahim organisational objectives. According to Absar et al.16, reported
8
and Boerhaneoddin , compensation encourage effective that employee compensation is one of the major functions of
employees to remain in employment for longer periods of human resources management. Compensation is important
time. Additionally, Ibrahim and Boerhaneoddin8 suggested for both employers and employees regarding attracting,
that generous rewards retain employees and ultimately lead retaining and motivating employees. Ray and Ray17 regarded
to job satisfaction, commitment and loyalty. Evidence from compensation as important for employees since it is one of

81
 Res. J. Business Manage., 11 (2): 80-90, 2017

the main reasons people work. Compensation includes claims However, Sohail and Delin31 disclosed that remuneration
on goods and services paid to an employee in the form of has a moderate relationship with job satisfaction
money or a form that is quickly and easily exchangeable into among academics in higher education institution.
money at the discretion of the Nel et al. . Compensation or
18
Al-Hinai and Bajracharya 32
also reinforces these views who
total compensation is the total of all rewards provided to further stated that remuneration helps and supports
19
employees in return for their services . individuals to meet the basic needs through pay and salary as
Qasim et al. stated that monetary rewards play major
20
explained in Maslow s law. Moreover, remuneration is
role in determining job satisfaction. Pay is one of the considered to be one of the extrinsic factors (hygiene) as per
fundamental components of job satisfaction since it has a Herzberg theory, in which leads to dissatisfaction if absent and
powerful effect in determining job satisfaction. The growing does not achieve the satisfaction of an academic staff in
needs of people with high living costs force workers seeking higher education institution when it exist. Shoaib et al.33 stated
higher income that can guarantee their future and life that attractive remuneration packages are one of the very
satisfaction. Moreover, if individuals believe they are important factors that affect job satisfaction.
not compensated well therefore a state of emotional
dissatisfaction will be developed. These emotional Fringe benefits: World at Work14 stated that benefits include
discrepancies will grow and accumulate over time thus make packages an employer practices to supplement the cash
employees unhappy and unsatisfied working for the compensation that employees receive. It comprises of health,
organisation. Greenberg and Baron21 indicated that a income protection, savings and retirement programs provide
perceived low salary leads to job dissatisfaction and a major security for employees and their families. A specific set of
contributor to employee turnover. Khan et al.22 posited that organisational practices, policies and programmes, plus a
academic staff commitment can be enhanced and their philosophy that actively supports efforts to help employees
degree of satisfaction could be improved by identifying the achieve success at both work and home. Fringe benefits
influence compensation. include any variety of programmes that provide paid time off,
Mangi et al. revealed that compensation has optimistic
23
employee services and protection programmes. According to
relationship with job satisfaction. However, compensation is Bratton and Gold34, fringe benefits refer to the part of the
the major forecaster of job satisfaction. It is the amount of rewards package provided to an employee in addition to the
monetary compensation that is expected by workers in guaranteed basic remuneration. An employee remuneration
relationship with the services provided to the institutions24. package includes guaranteed employment benefits such as
The study conducted by Noordin and Jusoff25 and Mustapha26 retirement benefits, medical aid benefits, life and disability
reported that salary have a significant effect on lecturers level insurance, housing benefits, car allowance or cell phone
of job satisfaction which is also aligned with a study by allowance35. Martocchio36 elaborated that fringe benefits can
Yang et al. stated that salary increase significantly improved
27
also included prerequisite perks such as relocation payments,
the job satisfaction for Chinese junior military officers. flexible start dates, sign-on bonuses, use of company-owned
Nawab and Bhatti13 reported that remuneration has an property, health club membership, tuition reimbursement,
influence on employee job satisfaction, their study further financial planning and clothing allowances. Artz37 reported a
revealed that remuneration has a strong significance influence significant positive estimates for variables as paid vacation and
on job satisfaction among academic employees. The study sick pay but no significance for any of the remaining benefits:
conducted by Mafini and Dlodlo28, in higher education Child care, pension, profit sharing, employer provided
institutions in South Africa disclosed that there is a moderate training/education and health insurance.
positive relationship between pay/remuneration and job Asegid et al.38 revealed that fringe benefits were a
29
satisfaction. Furthermore, the study by Strydom discovered significant of overall job satisfaction. Conversely, Tella et al.39
that remuneration plays a major role in job satisfaction and included the most of the fringe benefits in the study of
dissatisfaction of faculty members in higher education employees of non-profit organisations and finds only two out
30
institutions. Ismail and Abd Razak findings concur that of nine fringe benefits are positive and significantly related to
remuneration is considered one of the complex and job satisfaction and that one is negative and significant. In
multidimensional factors of job satisfaction in higher addition, the study by Artz37 revealed that fringe benefits have
education institutions. a significant and positive relationship with job satisfaction.

82
 Res. J. Business Manage., 11 (2): 80-90, 2017

Furthermore, Artz37 revealed that fringe benefits make up a level. There is less evidence available related to job
significant portion of employer compensation packages but satisfaction in higher education, this means that most of the
their impact on worker job satisfaction has given much literature review on these variables (job satisfaction and
attention. Also Artz37 attested that fringe benefits can affect organisational commitment) is based on the business sector
job satisfaction in opposing ways. First of all, since fringe and public sector. Job satisfaction is a concept that has been
benefits are generally less taxed than wages, they can be studied broadly in the field of human resource management
purchased at less cost through an employer than if bought on and organisational behaviour in the past and continues to be
the market. Second, fringe benefits are often desirable pieces regarded as highly important 43,44. It is an important construct
of compensation packages and so increase job satisfaction. It in organisations that cannot be ignored because of the
is evident that compensation and fringe benefits have a relationship it has with several significant employee
significant relationship from organisational level, the literature behaviours such as tardiness, low productivity, absenteeism,
is inaudible about higher education institutions. Therefore, turnover, job performance, increased motivation, better
the current study seeks to fill that gap. productivity and organisational effectiveness45,46.
In higher education sector, academics attitude of job
Job satisfaction in higher education institutions: Employee satisfaction is important. Job satisfaction may contribute more
job satisfaction has remained a remarkable area in the than one can expect towards achieving universities strategic
field of human resources management, psychology and goals. Job satisfaction can also contribute significantly in
organisational. It is necessary for management to look into assisting the development and sustainability of higher
the welfare and well-being of their employees. A happy education sector47. Noordin and Jusoff25 found that job
employee is regarded as a more efficient and more productive satisfaction has significant impact on academics excellent
employee. Employees join organisation with certain motives performance, high commitment and low turnover. Joshua48
like job security, better prospects in future and satisfaction of asserted that organisational researchers have attached a high
both social and psychological needs. Mustapha26 attested that level of importance to job satisfaction. Job satisfaction focuses
job satisfaction of lecturers should be seriously considered by
on employee attitudes towards their job. The relationship
all higher education institutions to improve the quality of
between the organization and its members is influenced by
education thus producing outstanding graduates. Lecturers
what motivates them to work and the rewards and fulfilment
who are always stressful and dissatisfaction with their work
they derive from it49. Individuals enter organisations with a set
will affect the performance and quality of work26. Werner40
of desired needs and expect the organisation to satisfy these
noted that job satisfaction is the most widely research area of
needs. One of these expectations is job satisfaction. It is thus
work-related attitudes. It is a personal appraisal of the job and
imperative for managers to take cognisance of the importance
psychological experience at work. It is a measure of the
of ensuring that their employees are satisfied because a lack
general attitude to work of a specific individual rather than
of job satisfaction can have dire consequences to an
group of workers. Onukwube41 stated that job satisfaction is
organisation50.
the sense of well-being, good feeling and positive mental
state that emerge in an incumbent when obtained reward
Moderating effect of compensation and benefits on job
consequent upon his performance is congruent to
satisfaction: Shoaib et al.33 revealed that attractive and
equitable rewards. Factors such as working conditions, below
competitive salary, lack of promotional opportunities and lack competitive remuneration packages still ranked as one of the
of recognition are some of the contributing factors to very important factors that affect job satisfaction because it
employee dissatisfaction. Job satisfaction of academic staff in fulfils the financial and material desires. Salary, retirement
higher education institutions is importance because it benefits and job security have been shown to be important
influences their motivation and performance that are very personal issues that affect the satisfaction of the faculty
influential in delivering quality education services. Achieving members in college and universities. While Rosser51 revealed
organisational goals and objectives depends on the managers' that although much of the overall research on the faculty
ability to influence employees' attitudes toward their jobs. Job members suggested the salary is the most important aspect in
satisfaction among academic staff is critical in higher work life and job satisfaction. Salary is one of the primary
education. Daft42 emphasised that managers of knowledge reasons why faculty members leave their institutions.
workers often have to rely on job satisfaction to keep both According to Tettey52, dissatisfaction with salaries is one of the
motivation and enthusiasm for the organisation at a high key factor undermining the satisfaction and commitment of

83
 Res. J. Business Manage., 11 (2): 80-90, 2017

the academics to their institutions and careers and it is the have appropriate pay systems that encourage and reward
factor that affect their stay in their jobs. employees to remain longer with their institutions. The
Munap et al.53 also found that all organisational rewards literature reviewed in the previous, assumed the existence of
examined have contributed to employee s satisfaction while relations between rewards and job satisfaction factors
salary is the predictor that significantly contributes to job amongst academics. Moreover, these assumptions suggested
satisfaction , among employees. Organisational rewards have significant positive relationships between rewards and job
a positive relationship with job satisfaction. Employees satisfaction factors. Therefore, the following hypotheses within
believe that their attachment to the organisation will provide the present study have been formulated:
meaningful rewards that satisfy their needs. Therefore, most
of the employees trust that each of their job accomplishment Hypothesis 1 (H1): There is a positive relationship between
will be rewarded and effort will be kept continued for better compensation and job satisfaction.
rewards53. Rehman et al.54 also reported that there is a positive
relationship between rewards and job satisfaction. The study Hypothesis 2 (H2): There is a positive relationship between
was conducted in the service industry, it found the rewards benefits and job satisfaction.
are stronger determinant of job satisfaction.
Ghafoor55 study findings are consistent with the literature MATERIALS AND METHODS
and suggested that there is a moderate, positive correlation
between pay and job satisfaction. Pay is treated as an intrinsic Research approach: A quantitative research method and a
hygiene factor of job satisfaction in Herzberg s model. As far as survey design were deemed appropriate for examining the
designations of academic staff were concerned, professors impact of compensation, benefits on job satisfaction.
were more satisfied than lecturers with pay, due to receiving Quantitative research looks at numbers and statistical
pecuniary and non-pecuniary benefits. Hamman-Fisher56 interpretation of the data gathered from questionnaires as
revealed that there are statistically significant relationships opposed to looking at processes and meanings as in
between pay and job satisfaction, benefits and job qualitative research65. Quantitative research is concerned with
satisfaction, contingent rewards and job satisfaction, nature of the facts or responses of participants.
work and job satisfaction and for promotion and job
satisfaction. The moderate to high correlations between these Research participants: A survey method was employed for
dimensions and job satisfaction suggest that the higher their the present study. The sample used in this study was
relationship with job satisfaction, the more satisfied made of 279 academics from two universities of technology
employees would be. in Free State and Gauteng province in South Africa. Probability
Several studies have reported a positive relationship sampling method was employed using systematic sampling
between compensation and job satisfaction9,57-60. Sharp61 method. This method was appropriate to recruit participants.
found that despite the high proportion of participants who Permission was requested from respected universities. The
reported that they were very dissatisfied with their ethical guidelines of research permission to conduct the study
compensation, a low correlation was found between was obtained from both institutions. The demographic
compensation and job satisfaction. A follow-up research characteristics of the respondents depicted in Table 1.
examining this finding should be carried out was suggested. An analysis of the demographic profile of respondents
Letele-Matabooe62 revealed that to receive a competitive (Table 1) reveals that approximately 50.5% (n = 102) of the
remuneration is more likely to provide job satisfaction. respondents were female, whereas approximately 49.5%
Theodossiou and Vasileiou63 reported thet positive (n = 100) were male. After collapsing the respondents ages, it
relationships between employees who feel secure in their jobs emerged that the largest group of respondents (43.6%, n = 88)
and their level of job satisfaction. In addition, evidence exists were aged between 30 and 45 years. Additionally,
suggesting that lower levels of compensation lead to lower approximately 38.1% (n = 77) of the respondents were in
levels of satisfaction among employees. Similar results have possession of a Masters degree. In terms of racial group,
been reported in the present study by Letele-Matabooe62 that African (68.8%, n = 139) were the highest number. With regard
job security and compensation has been found to have a to the position occupied, the largest group of respondents
significant influence on Job satisfaction. Mutjaba and Shuaib64 (89.6%, n = 181) was lecturers, followed by senior lecturers
asserted that for academic institutions to attract, retain and (6.9%, n = 14), with associate professors (0.5%, n = 1) being
satisfy their talented employees, these institutions needs to the smallest number.

84
 Res. J. Business Manage., 11 (2): 80-90, 2017

Table 1: Demographic profile of respondents (n = 205)

Variables Categories n %
Gender Male 100 49.5
Female 102 50.5
Age 18-29 49 24.3
30-45 88 43.6
46-64 61 30.2
65+ 4 1.9
Race African 139 68.8
Indian 14 6.9
White 41 20.3
Coloured 8 4.0
Tenure 0-1 year 22 10.9
1-4 years 50 24.8
5-7 years 68 33.7
7-15 years 62 30.7
Qualification Honours degree 33 16.3
Masters degree 77 38.1
PhD 17 8.4
B Tech 35 17.3
M Tech 33 16.3
D Tech 7 3..5
Rank Lecturer 181 89.6
Senior lecturer 14 6.9
Associate professor 1 0.5
Professor 2 1.0
Head of Department 4 2.0
Source: Authors compilation from survey data

Measuring instrument and ethical consideration: The Data analysis: Data were analysed using Statistical Package
method of data collection were the structured questionnaire, for the Social Sciences (SPSS version 23.0). Initially,
66
designed to elicit information from the participants . The demographic data of the subjects, frequencies and the scores
Total Rewards Model adopted from World at Work67 was used of the overall work-related factors as well as measures of
to formulate the questionnaire which was administered to the central tendency were established. Internal consistency
selected respondents. The questionnaire was developed using estimates were formulated using Cronbach s alpha
the Total Rewards Model with the aim of allowing employees coefficients. Following this, a series of multivariate statistical
to identify important specific total rewards, as well as to record procedures included exploratory factor analysis, Pearson
their levels of satisfaction with the total rewards they are correlation analysis and linear regression were computed on
offered based on a 5 point Likert scale ranging from strongly all the variables. The required level of significance (p) was set
disagree (1) to strongly agree (5). The total reward instrument at 1%. The appropriateness of the data for factor analysis of
used showed a Cronbach s alpha of 0.822. The Total Rewards different scale measures was determined by applying the
Questionnaire comprises of the following components: Kaiser-Meyer-Olkin (KMO) measure of sampling and Bartlett s
test of sphericity to the inter item correlation matrix of the
• Compensation measurement instruments. The KMO measure determines the
• Benefits degree of inter-correlations between the variables68. A KMO
of 0.6 is considered acceptable for factor analysis.
Job satisfaction survey was also administered to selected
participants. The questions were presented in such a way that RESULTS AND DISCUSSION
they would not elicit more than one answer. The
questionnaire accompanied a letter explaining the ethical Table 2 shows that there is a positive and significant
considerations involved, notably that participating in the relationship between compensation and job satisfaction
study was a voluntary exercise and that the respondents (r = 0.263, p>0.01). Therefore, hypothesis is accepted. This
could withdraw from the study at any point. means that compensation has a positive effect on job

85
 Res. J. Business Manage., 11 (2): 80-90, 2017

satisfaction. However, there are other factors that also affect 7.954 at 2 and 214 degree of freedom showed the explanatory
job satisfaction. Moreover, Table 2 reveals an inverse variables (compensation) considered in this study can
relationship between benefits and job satisfaction (r = 0.015), moderately explain the variation of dependent variable at
p>0.05). Therefore, hypothesis is rejected. This means that 0.000 (99%) confidence level. Moreover, Table 3 depicts that
benefits does not affect job satisfaction in a South Africa when other variables not included in this study but have
context. impact on dependent variable (job satisfaction). Benefits do
not impact job satisfaction. Compensation is the strong
Inferential statistics: The results of inferential statistics predictor of job satisfaction with a standardized beta value of
technique used in the study to test the hypothesis are 0.261. Benefits was found to be non-significant at 99%
presented. Multiple regression analysis was applied to see (p<0.01).
which factor impact job satisfaction.
Research question 1: Compensation has a positive and
Multiple regression analysis: Regression analysis aids in order significant effect on job satisfaction. This hypothesis was
to measure the relative strength of independent variable on supported, therefore indicating that compensation
ependent variable. All direct positive relationship between influences job satisfaction among academic staff.
variables and job satisfaction were examined using multiple Tabatabaei and Farazmehr69 study revealed that there is a
regression analysis to ascertain the extent to which they positive and significant relationship between compensation
explain that the variance in job satisfaction. and job satisfaction among academic staff. Moreover,
According to Table 3, it is evident that coefficient of Machado-Taylor et al.70 found that academics were most
multiple correlation R which is the degree of association satisfied with the opportunity to use their own initiative, with
between compensation, benefits and job satisfaction is 0.526. relationships with their colleagues and with the actual work;
There is also R2 value of 0.069 and adjusted R of 0.60. The they were least satisfied with promotion prospects and salary.
model summary revealed the proportion of the variation in job Machado-Taylor et al.71 stated that dissatisfaction stems from
satisfaction is explained by compensation 69% and the inadequate and non-competitive salaries and further lack of
remaining is explained by other variables. The F-statistic of job satisfaction due to non-monetary reasons. Mustapha26
indicated that a remuneration system plays a significant role
Table 2: Correlations matrix in determining an employee's level of job satisfaction in higher
Job education institutions. This factor also involves the degree to
Correlation Compensation Benefits satisfaction
which individuals are considering fair compensation they
Compensation 1
Benefits 0.015 1
receive for their study, when compared to the earnings
Job satisfaction 0.263** 0.06 1 received by the other members of the organisation. Salary
Correlation is significant at the 0.01 level (2-tailed) has a significant effect on the job satisfaction. Therefore,

Table 3: Model summary

Standard error of
Model R R2 Adjusted R2 the estimate
1 0.526a 0.69 0.60 0.969
ANOVAb
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Model 1 Sum of squares df Mean square F-value Significant
Regression 14.945 2 7.473 7.954 0.000c
Residual 201.055 214 0.940
Total 216.000 216
Coefficientsd
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Unstandardized coefficients
--------------------------------------------------------- Standardized
Model 1 B Standard error coefficients beta t-test Significant
Job satisfaction 1.860 0.066 0.000 1.000
Compensation 0.261 0.067 0.261 3.926 0.000
Benefits 0.011 0.067 0.011 0.160 0.873
a
Predictors: (Job satisfaction), compensation, benefits, bDependent variable: Job satisfaction, cPredictors: (Constant), compensation, benefits, dDependent variable: Job
satisfaction, compensation, benefits

86
 Res. J. Business Manage., 11 (2): 80-90, 2017

researchers notice that in Europe intrinsic factors such as job needs to be developed. It is imperative to understand the
rank level, career are the predictors of higher job satisfaction complex nature in the compensation, job satisfaction
among employees. On the other hand, in USA high-job relationship and how to improve compensation in order to
satisfaction is influenced by the issues related to teaching. In meet the needs of employees. Results of the present study can
private universities salary, promotion opportunities and be used in order to design a rewards strategy while retaining
working conditions have the highest impact on job employees.
satisfaction72. Toker73 found the satisfaction with Human resources and remuneration specialists at
compensation, supervision, salary, fringe benefits are universities of technology need to design novel remuneration
evaluated lowest by the academics. Moreover, Ombima74 packages to attract and retain the best candidates and satisfy
study cited that better pay and incentives as the key reasons their employee s expectations, in that they are fair, equitable
for working for USIU. Most academics are satisfied with their and free of bias. A remuneration package is one of the most
jobs at United States International University. Findings for the important factors that influence people to take up
economic factors affecting employee job satisfaction indicated employment and stay with organisations. Additionally, in
that on average employees agree that their salary is paid on order to attract and retain talent, it should be prepared to pay
time, which makes them comfortable while at the same time salaries that are equivalent or better than others in the labour
they tend to agree that their salary does not match with the market. Similarly, rewards should be on a par with industry
cost of living in the country74. norms. Proper sector research should be conducted regularly
to determine what others are offering and adjust salaries
Research question 2: Benefit a significant effect on job accordingly.
satisfaction. This hypothesis is rejected. This implies that in a Academic studies have its own limitations and the
South African context, fringe benefits does not have a present study is no exception. It was conducted in two
correlation with job satisfaction and is not significant, which selected universities of technology among academic staff. The
the research reveals. These results mirror the findings of results cannot be generalised. The process of data collection
Tezera75 revealed an inverse relationship between benefit and was a very difficult and time-consuming exercise. An
employees job satisfaction in EIC (r = - 0.011, p>0.05). Noor47 electronic method of data collection should be considered to
found that benefits insignificant correlations with job reduce time and cost of travelling to different campuses,
satisfaction (r = -0.43, p<0.01) and with organisational which would enable academic staff to complete online
commitment (r = 0.36, p<0.01). These results are in line with surveys.
the study of Mbundu76, reported that fringe benefits were not
correlated with job satisfaction. Moreover, Moloantoa77 ACKNOWLEDGEMENTS
revealed that fringe benefits are not significantly related to job
satisfaction among academic staff. The results of Moloantoa77 The authors would like to thank that academic staff of
further indicated that fringe benefits is not the predictor of job Vaal University of Technology and Durban University of
satisfaction. Technology of their help to carried out in the study.

Practical implications: Higher education institutions will gain REFERENCES

an insight from the current study on how to improve factors
that impact job satisfaction through compensation. The 1. Millan, J.M., J. Hessels, R. Thurik and R. Aguado, 2013.
inverse relationship between benefits and job satisfaction Determinants of job satisfaction: A European comparison of
cannot be overlooked. The results indicated a positive and self-employed and paid employees. Small Bus. Econ.,
significant relationship between compensation and job 40: 651-670.
2. Bustamam, F.L., S.S. Teng and F.Z. Abdullah, 2014. Reward
satisfaction. These results warrant caution to higher education
management and job satisfaction among frontline
institutions to pay much attention on compensation. There is
employees in hotel industry in Malaysia. Proc. Social Behav.
an expectation from the employees that they will be
Sci., 144: 392-402.
adequately compensated for their efforts.
3. Terera, S.R. and H. Ngirande, 2014. The impact of rewards on
job satisfaction and employee retention. Mediterr. J. Soc. Sci.,
CONCLUSION AND FUTURE RECOMMENDATION 5: 481-487.
4. Adeoye, A.O. and Z. Fields, 2014. Compensation management
If higher education institutions aims to attract and and employee job satisfaction: A case of Nigeria. J. Soc. Sci.,
retain their academic staff, a novel proper compensation 41: 345-352.

87
 Res. J. Business Manage., 11 (2): 80-90, 2017

5. Netswera, F.G., E.M. Rankhumise and T.R. Mavundla, 2005. 21. Greenberg, J. and R.A. Baron, 2008. Behaviour in
Employee retention factors for South African higher Organizations. 9th Edn., Pearson Education Inc., Upper Saddle
education institutions: A case study. S. Afr. J. Hum. Resour. River, New Jersey..
Manage., 3: 36-40. 22. Khan, M.S., I. Khan, G.M. Kundi, S. Khan, A. Nawaz, F. Khan and
6. Gordon, E.E., 2009. Winning the Global Talent Showdown. N.B. Yar, 2014. The impact of job satisfaction and
Berrett-Koehler Publishers, San Francisco. organizational commitment on the intention to leave among
7. Krell, E., 2011. The global talent mismatch. HR Mag., 56: 68-73. the academicians. Int. J. Acad. Res. Bus. Social Sci., 4: 114-131.
8. Ibrahim, I.I. and A. Boerhaneoddin, 2010. Is job satisfaction 23. Mangi, R.A., H.J. Soomro, I.A. Ghumro, A.R. Abidi and
mediating the relationship between compensation structure A.A. Jalbani, 2011. A study of job satisfaction among non PHD
and organisational commitment? A study in the Malaysian faculty in universities. Aust. J. Bus. Manage. Res., 1: 83-90.
power utility. J. Global Bus. Econ., 1: 43-61. 24. Saif, S.K., A. Nawaz and F.A. Jan., 2012. Predicting
9. Bagraim, J., T. Potgieter, C. Viedge and A. Werner, 2007. job-satisfaction among the academicians of universities in
Organisational Behaviuor. Van Schaik, Pretotria. Kpk, Pakistan. Ind. Eng. Lett., 2: 34-45.
10. Judge, T.A., R.F. Piccolo, N.P. Podsakoff, J.C. Shaw and 25. Noordin, F. and K. Jusoff, 2009. Levels of job satisfaction
B.L. Rich, 2010. The relationship between pay and job amongst Malaysian academic staff. Asian Soc. Sci., 5: 100-122.
satisfaction: A meta-analysis of the literature. J. Vocational 26. Mustapha, N., 2013. The influence of financial reward on job
Behav., 77: 157-167. satisfaction among academic staffs at public universities in
11. Bakan, I. and A.T. Buyukbese, 2013. The relationship between Kelantan, Malaysia. Int. J. Bus. Soc. Sci., 4: 244-248.
employee s income level and employee job satisfaction: An 27. Yang, H., D. Miao, X. Zhu, Y. Sun, X. Liu and S. Wu, 2008. The
empirical study. Int. J. Bus. Soc. Sci., 4: 18-25. influence of a pay increase on job satisfaction: A study with
12. Salisu, J.B., E. Chinyio and S. Suresh, 2015. The impact of the Chinese army. Social Behav. Personality: Int.
compensation on the job satisfaction of public sector J., 36: 1333-1339.
construction workers of Jigawa state of Nigeria. Bus. Manage. 28. Mafini, C. and N. Dlodlo, 2014. The relationship between
Rev., 6: 282-296. extrinsic motivation, job satisfaction and life satisfaction
amongst employees in a public organisation. S. Afr. J. Ind.
13. Nawab, S. and K.K. Bhatti, 2011. Influence of employee
Psychol., 40: 1-12.
compensation on organizational commitment and job
29. Strydom, A., 2011. The job satisfaction of academic staff
satisfaction: A case study of educational sector of Pakistan.
members on fixed-term employment contracts at South
Int. J. Bus. Soc. Sci., 2: 25-32.
African higher education institutions. Ph.D. Thesis, University
14. World at Work, 2015. World at work introduces
of Free State, Bloemfontein.
revised total rewards model. Online.
30. Ismail, A. and M.R. Abd Razak, 2016. A study on job
https://www.worldatwork.org/aboutus/html/aboutus-
satisfaction as a determinant of job motivation. Acta
whatis-tr-model.jsp#model.
Universitatis Danabius, 12: 30-44.
15. Swanepoel, B.J., B.J. Erasmus, H.W. Schenk and
31. Sohail, M.T. and H. Delin, 2013. Job satisfaction surrounded
T. Tshilongamulenzhe, 2014. South African Human Resource
by academics staff: A case study of job satisfaction of
Management: Theory and Practice. 4th Edn., Juta, Cape Town.
academics staff of the GCUL, Pakistan. J. Contemp. Res. Bus.,
16. Absar, M.M.N., M.T. Azim, N. Balasundaram and S. Akhter,
4: 126-137.
2010. Impact of human resources practices on job
32. Al-Hinai, Z.A. and A. Bajracharya, 2014. A study on the factors
satisfaction: Evidence from manufacturing firms in
affecting job satisfaction of academic staff in higher
Bangladesh. Econ. Sci. Ser., 62: 31-42.
education institution. Proceedings of the 13th International
17. Ray, S. and I.A. Ray, 2011. Human resource management
Academic Conference, September 15-18, 2014, Antibes,
practices and its effect on employee's job satisfaction: A study
France.
on selected small and medium sized iron and steel firms in
33. Shoaib, M., A. Noor, S.R. Tirmizi and S. Bashir, 2009.
India. Public Policy Admin. Res., 1: 22-31.
Determinants of employee retention in telecom sector of
18. Nel, P.S., A. Werner, P. Poisat, T. Sono, A.J. Du Plessis
Pakistan. Proceedings of the 2nd COMSATS International
and O. Nqalo, 2011. Human Resources Management. Oxford Business Research Conference, November 14, 2009, Lahore,
University Press, Cape Town. Pakistan.
19. Phonsanam, S.T., 2010. Total compensation practices and 34. Bratton, J. and J. Gold, 2007. Human Resource Management:
their relationship to hospitality employee retention. Masters Theory and Practice. 3rd Edn., Palgrave Macmillan, New York,
Thesis, University of Nevada, Las Vegas. USA.
20. Qasim, S., F.E.A. Cheema and N.A. Syed, 2012. Exploring 35. Dulebohn, J.H., J.C. Molloy, S.M. Pichler and B. Murray, 2009.
factors affecting employee's job satisfaction at work. Employee benefits: Literature review and emerging issues.
J. Manage. Soc. Sci., 8: 31-39. Hum. Resour. Manage., 19: 86-103.

88
 Res. J. Business Manage., 11 (2): 80-90, 2017

36. Martocchio, J.J., 2013. Strategic Compensation: A Human 52. Tettey, J.W., 2006. Staff Retention in African Universities:
Resource Management Approach. 7th Edn., Pearson Elements of a Sustainable Strategy. The World Bank,
Education, Upper Saddle River, New Jersey. Washington, DC.
37. Artz, B., 2010. Fringe benefits and job satisfaction. Int. 53. Munap, R., M.I.M. Badrillah and B.A. Rahman, 2013.
J. Manpower, 31: 626-644. Organizational rewards system and employee's
38. Asegid, A., T. Belachew and E. Yimam, 2014. Factors satisfaction at Telekom Malaysia Berhad. J. Educ. Social
influencing job satisfaction and anticipated turnover among Res., 3: 281-288.
nurses in Sidama zone public health facilities, south Ethiopia. 54. Rehman, M., A.K. Mahmood, R. Salleh and A. Amin, 2013. Job
Nursing Res. Pract., Vol. 2014. 10.1155/2014/909768 satisfaction and knowledge sharing among computer and
39. Tella, A. C.O. Ayeni and S.O. Popoola, 2007. Work motivation, information science faculty members: A case of Malaysian
job satisfaction and organisational commitment of library universities. Res. J. Applied Sci. Eng. Technol., 7: 839-848.
personnel in academic and research libraries in oyo state, 55. Ghafoor, M., 2014. Antecedents and consequences of job
Nigeria. Library Philosophy and Practice, Paper No. 118, April, satisfaction: Evidence from Pakistani universities. Ph.D. Thesis,
2007. University of Dundee, Dundee.
40. Werner, A., 2007. Organisational Behaviour: A Contemporary 56. Hamman-Fisher, D., 2008. The relationship between job
South African Perspective. Van Schaick, Pretoria, satisfaction and organisational commitment amongst
ISBN: 9780627026584, Pages: 400. academic employees in agricultural colleges in South Africa.
41. Onukwube, H.N., 2012. Correlates of job satisfaction amongst Master's Thesis, University of the Western Cape,
quantity surveyors in consulting firms in Lagos, Nigeria. Aust.
Cape Town.
J. Construct. Econ. Build., 12: 43-54.
57. Brown, G.D.A., J. Gardner, A.J. Oswald and J. Qian, 2008. Does
42. Daft, R., 2009. Organization Theory and Design. 10th Edn.,
wage rank affect employee's well-being? Ind. Relations:
Cengage Learning, USA., ISBN-13: 978-0-324-59889-6,
J. Econ. Soc., 47: 355-389.
Pages: 649.
58. Skalli, A., I. Theodossiou and E. Vasileiou, 2008. Jobs as
43. Verret, L.B., 2012. Factors affecting university STEM
lancaster goods: Facets of job satisfaction and overall job
faculty job satisfaction. Masters Thesis, Louisiana State
satisfaction. J. Socio-Econ., 37: 1906-1920.
University, USA.
59. Clark, A.E., N. Kristensen and N. Westergard-Nielsen, 2009. Job
44. Eyupoglu, S.Z. and T. Saner, 2009. The relationship
satisfaction and co-worker wages: Status or signal? Econ.
between job satisfaction and academic rank: A study of
J., 119: 430-447.
academicians in Northern Cyprus. Proc. Soc. Behav.
60. Pouliakas, K. and I. Theodossiou, 2010. Differences in the job
Sci., 1: 686-691.
satisfaction of high-paid and low-paid workers across Europe.
45. Aydogdu, S. and B. Asikgil, 2011. An empirical study of the
Int. Labour Rev., 149: 1-29.
relationship among job satisfaction, organizational
61. Sharp, T.P., 2008. Job satisfaction among psychiatric
commitment and turnover intention. Int. Rev. Manage.
registered nurses in New England. J. Psychiatr. Mental Health
Market., 1: 43-53.
Nurs., 15: 374-378.
46. Kipkebut, D.J., 2010. Organisational commitment and job
62. Letele-Matabooe, M.J., 2012. An investigation into the factors
satisfaction in higher educational institutions: The Kenyan
case. Ph.D. Thesis, Middlesex University, Middlesex. influencing the levels of job satisfaction and organisational
47. Noor, K.M., 2013. Job satisfaction of academics in Malaysian commitment of non-family employees working in family
public higher education institutions. Masters Thesis, La Trobe businesses. Master's Thesis, Nelson Mandela Metropolitan
University, Melbourne. University, Port Elizabeth.
48. Joshua, D., 2008. Internal factors influencing job satisfaction 63. Theodossiou, I. and E. Vasileiou, 2007. Making the risk of job
in a freight forwarding company. Master's Thesis, Durban loss a way of life: Does it affect job satisfaction? Res.
University of Technology, Durban. Econ., 61: 71-83.
49. Mullins, L.J., 2007. Management and Organizational Behavior. 64. Mutjaba, B.G. and S. Shuaib, 2010. An equitable total rewards
Financial Times Prentice Hall, New Jersey, approach to pay for performance management. J. Manage.
ISBN: 9780273708889, Pages: 837. Policy Practice, 11: 111-121.
50. Peerbhai, R., 2006. Job satisfaction at IT SMEs in Durban. 65. Creswell, J.W., 2007. Educational Research: Planning,
Master's Thesis, Business Studies Unit, Durban Institute of Conducting and Evaluating Quantitative and Qualitative
Technology, Durban. Research. 3rd Edn., Prentice Hall, USA., ISBN-10: 0136135501,
51. Rosser, V.J., 2004. Faculty member's intentions to leave: A pp: 670.
national study on their worklife and satisfaction. Res. Higher 66. Babbie, E., 2008. The Practice of Social Research. Wadsworth
Educ., 45: 285-309. Publishing, Belmont, California,.

89
 Res. J. Business Manage., 11 (2): 80-90, 2017

67. World at Work, 2008. World at work total rewards model: A 73. Toker, B., 2011. Job satisfaction of academic staff:
framework for strategies to attract, motivate and retain An empirical study on Turkey. Qual. Assur. Educ.,
employees. The Total Rewards Association. 19: 156-169.
http://www.worldatwork.org/pub/total_rewards_brochure 74. Ombima, H.P.A., 2014. Factors affecting employee job
.pdf. satisfaction in institutions of higher education in Kenya:
68. Field, A., 2009. Discovering Statistics Using SPSS. A case study of United States International University
3rd Edn., SAGE Publications Ltd., London, UK., (USIU). Ph.D. Thesis, United States International
ISBN: 978-1-84787-907-3, Pages: 822. University-Africa.
69. Tabatabaei, S.O. and Z. Farazmehr, 2015. The relationship 75. Tezera, M., 2014. The relationship of reward
between emotional intelligence and Iranian language management practices to employees job satisfaction in
institute teacher's job satisfaction. Theory Practice Language Ethiopian insurance corporation. Master's Thesis, University
Stud., 5: 184-195. of Addis Ababa.
70. Machado-Taylor, M.D.L., V.M. Soares, J.B. Ferreira and 76. Mbundu, I.N., 2011. A critical evaluation of job satisfaction
O.M.R. Gouveia, 2011. What factors of satisfaction and levels during the transitional period of a merger: The case of
motivation are affecting the development of the academic Walter Sisulu University. Master's Thesis, University of South
career in Portuguese higher education institutions? Rev. Adm. Africa, Pretoria.
Publica, 45: 33-44. 77. Moloantoa, M.E., 2015. Factors affecting job satisfaction of
71. Machado-Taylor, M.D.L., V.M. Soares, R. Brites, J.B. Ferreira, academic employees: A case study of the National University
M. Farhangmehr, O.M.R. Gouveia and M. Peterson, 2016. of Lesotho. Master's Thesis, Durban University of Technology,
Academic job satisfaction and motivation: Findings from a Durban.
nationwide study in Portuguese higher education. Stud.
Higher Educ., 41: 541-559.
72. Hussein, A.I. and A.R.D. Idris, 2012. Structural equation models
of management and decision-making styles with job
satisfaction of academic staff in Malaysian Research
University. Int. J. Educ. Manage., 26: 616-645.

90