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RETRENCHMENT AND IT'S EFFECT ON THE MORALE OF WORKERS

ABSTRACT

This project was conducted as a part of the requirement for the award of higher national Diploma Certificate in Accountancy. The aim of the research work is to find out the effects of retirement on the morale of workers ie the still employed workforce. However, the research work is centered on the Institute of Management and Technology Enugu. The work is divided into five chapters on which every detail is given for proper understanding of the entire work and the topic.

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The Background of this study is on the Institute of Management and Technology, Enug, Enugu state which is made up of students. Academic staff (lectures and non-academic staff. It is aimed at finding the effect on the morale of the still employed workforce, that is of the moral of the workers is still low or if they feel threatened and if they have become more productive.

This research work was prompted by the way workers have been retrenched for the past years in institutes of higher learning. Human beings have often been accused of being lazy and having poor attitude to work as shown in McGregor’s assumption theory of X. In this theory, McGregor assumed that the average human bring doe not like working and would want to avoid it if possible, as a result, he would have to be controlled, threatened with punishment before he can put in effort to achieve some organizational objectives. McGregor want on to say that a human being wished to be directed and controlled in his now ambition and above all he wants security. 

This research work would want to find out if the above claimed reasons for retrenchment of workers were the true reasons for these actions or is McGregor’s assumption (ie laziness and poor attitude t work) were the real reasons or a combination of the two sets of behaviour led to the retrenchment of workers in the institute of Management and Technology, Enugu.

Moreover, people who wee affected by the mass purfe of workers have resulted to a number of ways of survive. Some who are opportune to have cars turned into taxi drivers others have turned to beggars while others turned to petty trading and other business.
In summary, this work sets out to find out why retrenchment is being embarked upon, who is being retrenched among the workers and the criteria for selecting them.

The research work will also be interested in finding out the effect this exercise has on the remaining staff, that is, has there been any noticeable change in productivity and in what direction. Government on their own are trying to decrease the work force in government parastatals in order to control excess of workers thus wages and salaries in order to channel such fund to other activities.

1.2 STATEMENT OF THE PROBLEM

The efficiency of running an organization or establishment depends more on the workforce. In recent times, workers have been under going the dilemma of retrenchment. The retrenchment exercise currently taking place in Nigeria posses economic and social problems. Retrenchment is defined as dismissal or termination of workers when the job ceases to exist, usually as a result of technological or economic recession or change. It can also be seen as an act of cutting down on expenses. It can also be said as when a worker is subjected to compulsory retirement or forceful removal from his/her designation of work.
It started in Nigeria as a result of economic recession in the early 80’s. the whole world has been going through a recession but the Nigerian case has been a peculiar situation because it has resulted in many people loosing their jobs. It can be seen in an Editorial Agony of Retrenchment from the personnel office of the Institute of management and Technology (February 11th, 1989). A state owned Institute of higher learning about 420 of its workers were retrenched out of the original 1,244 workers before the exercise was carried out, that is about 40% of the workforce.
A lot of factors have brought about the issue of retrenchment of workers in organizations and one of such factors includes the creation of state. This is a situation where as a result of the creation of a new state, workers (non-indigenes) who are part of the workforce are subjected to compulsory removal from their post or positions in the civil service. This, normally has an adverse effect on the individual worker because the number of years that has being put into service and other achievement attained during the period of service is not put into consideration thereby having the workers in a state of fobleness. Although on the other hand, retrenchment in this case is said to allow for people who are indigenes of a particular area to enjoy from the civil service. 
Another reason for the high level retrenchment rate could be attributed to gross insubordination on the part of the workers in relation to constituted authority hence, a typical example of this is stated in section 27 of the Institute of management and Technology enugu (IMT) Edit No 2 which is involved when there is an issue of gross insubordination in between a staff and the constituted authority or abscondment from duty.
This Edit no 2 of IMT section 27 states that
i. The council shall have power to remove from office on grounds of public interest or the institutes interest or indiscipline, misconduct or inefficiency or for reasons of reorganization any member of the academic or non-academic senior staff.
ii. In this and the next succeeding sections, the expression removal from office includes termination of appointments and dismissal from office of a person within the contemplation of those sections.
Lastly in almost all the instances of retrenchment of workers the major reasons have been
a. Years of service; that is some employees have put in more years of service than others.
b. Inefficiency
c. Fraud and disloyalty on the part of workers.
d. Poor health.

1.3 OBJECTIVE OF THE STUDY
Retrenchment of workers is an event currently taking place throughout the country. It has reached its height since the military government came into power.
It is the aim of this study therefore to find out the effect this exercise has had on the morale of the still employed workers.
a. What the workers think about retrenchment exercise
b. How retrenchment affects their productivity and attitude to work that is if the exercise has made them work hard because they are scared of loosing their jobs too or do they feel alienated from their jobs.
c. Reasons for the retrenchment of workers and the criteria for selecting who is to go.
d. Social consequence of retrenchment of workers

1.4 RESEARCH QUESTIONS
In pursuance of this research work, the researcher considers it necessary to pose some research questions. These research questions are based on the objective of study.
a. How is retrenchment exercise affecting the workers as an individual?
b. How exactly does retrenchment affect productivity and workers attitude to work? Has it made them to feel alienated from their jobs?
c. What are the reasons for the retrenchment of workers and the criteria for selecting who is to go? And what alternative the management would have preferred to take?
d. What are the possible consequences of retrenchment. 
Furthermore, in the past years, retrenchment of workers has been the order of the day. It has reached a crisis situation since the military took over the government.
The serious nature of this exercise has made the executives of the Nigerian Labour Congress (NLC) to cry out on behalf of their members to the government both federal and state to stop further retrenchment of workers because of the very hard conditions it is subjecting their members to.

1.5 RESEARCH HYPOTHESIS
It is in the light of the above situation that this research is being carried out hoping that through the result, the true effect of the retrenchment would be known.
Therefore, where retrenchment is done on the basis of efficiency, this work would emphasize the fact that 
i. Employers do not always retrench just to save cost or to meet up with recession but the efficiency on the part of employee is rewarding.
ii. That disloyalty and fraud on the part of the worker can Easily lead to been retrenched by the employee.
However, it is hoped that the research paper would be of help to others who would want to explore on the area more.
Finally, the problems concerned to retrenchment study are the scope and limitations covered by the researcher.

1.6 SIGNIFICANCE OF THE STUDY
In pursuance of this research work, the researcher considers it necessary to see why it is necessary to carry out research on this problem.
a. How retrenchment exercise ie affecting he workers as an individual and how exactly retrenchment affects productivity and workers attitude to work. Whether retrenchment has made them work harder or if it has made them feel alienated from their jobs. 
Also the reasons for the retrenchment and the criteria for selecting who is to go. And what alternative action the management would take.

1.7 DEFINITION OF TERMS
RETRENCHMENT:
It can be said as the reduction or cutting down the amount of workers from service who are causing outlay. It is also the termination or dismissal of workers from their jobs as a result of technological or economic recession or change.
EMPLOYER
One who keeps person in one’s service either for a remuneration.

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