Abstract:
There is an inconsistency amongst scholars in regard to the influence of non-financial
compensation on the performance of employees in public organizations. Some agree that it
positively affects employees to work and stay in the organization while others oppose that they
do not motivate them. This study aimed to examine the influence of non-financial
compensation on the performance of employees in public organizations in Tanzania. The
study was guided by three specific objectives: - exploring non-financial compensations to
employees in public organizations; finding out the relationship between non-financial
compensations and the performance of employees, and determining the challenges of
implementing non-financial compensation in public organizations. This study employed a
mixed research approach. The study was conducted in Mkalama District Council, and it
focused on employees who work in public organizations. The targeted population was 1391
with a sample size of 70 respondents. Respondents were obtained through purposive and
stratified random sampling. It also adopted descriptive research design which aimed to
describe or document the characteristics, behaviours, attitudes, opinions and perceptions of a
group on a phenomenon being studied. Primary data was collected through questionnaires
and interviews while secondary data was obtained through reviewing various documents. Data
were analysed through thematic analysis method and descriptive statistical methods. The
findings revealed that, there was a relationship between non-financial compensation and
employees‟ performance. Many of the respondents claimed to have seen a close relationship
between non-financial compensation and employees‟ performance, but a few of them claimed
to have not witnessed a relationship between an employee‟s performance and non-financial
compensation. It is, therefore, top-level to lower-level employees should be involved in the
formulation and development of the policies related with non-financial compensation and the
entire workers‟ incentives in public organisations.
