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1.1     Background of the study

An organization is a structural component that is made up of sub-component such as man, materials and money which work interrelated and interdependently in the achievement of organizational objective. All these sub-component must work together before an organization can increase or improve in its performance. But among them, man which is the employer and the employee must exist in a cordial relationship between themselves and with the organization so as to enable them actualized the objective of the organization, manage the materials and money and also have a satisfactory working environment. Again, the employees in the organizations are the vital elements an organization should always strive hard to satisfy because without the employees, the organization would find it difficult to survive. In that case, the employer in an organization must have a good employee relation which will help the employees feel relaxed and satisfied in their workplace.

However, in context to the prevalent discussion, employee relation is seen as the fairness, trust, and the harmonious relationship that exist among the employers and their employees within organization which has a positive effect on organizational performance (Bingham, 2016). It is also seen in simple terms as the relationship that exists between the employer and the employee. According to Muhammed, Sohail, & Riaz (2013) in their research “impact of employee relation on employee performance in hospitality industry of Pakistan” view employee relation as a set of organizational functions and practices that deals with issues related to people as staffing, compensation and benefit, performance management, organizational development, health and safety, communication and administration. These means that people separated as staff should have connections or relationships among each other which will enable them work together as a team in getting a setting work done. Nevertheless, employees who have worked so hard need to be compensated and grant benefit that will make them satisfied in their workplace. In order to determine the workplace satisfaction of employees, certain variables such as health, safety, employees’ canteen, compensation, benefit, communication and many other variables need to be considered so that the organization can improve in its performance.

Therefore, an organization can only improve in its performance when the employees that work in that organization have developed a sense of belonging, and go extra mile to help the organization prosper. It is against this boundary that this study seems to investigate the effect of employee relations on organizational performance using Michelle Pharmaceutical Company as a case study.

1.2     Statement of the Problem

In recent time, some organizations have been decreasing in its performance due to inadequate management abilities of employee relations by the human resource department which is in charge of the employee’s welfare within the organization. Organizations can only improve in its performance if only a proper employee relation is adopted and maintained. However, relatively little has been written about the everyday management strategies involved in management of the contemporary relationship. Over the years the Chartered Institute of personnel and Development has undertaken a series of interviews with human resource professionals that were designed to establish what significance the term employee relation has for them and their organization.

Nevertheless, the vital determinants of work place performance are employee relationship which has been given little, if any priority. The aspect of employee- employee relations and how it relates to performance has not been given the attention it deserves by management. This is based on the fact that employees in every organization should be regarded as the most valuable assets in that organization. Hence their workplace environment impacts a lot on whether the organization achieves its goals.


1.3     Objectives of the Study

The objectives which this study seems to achieve are as follows:

  1. To find out the extent employee relations is practice in this organization.
  2. To determine the components of employee relations the organization gives attention.
  3. To examine the extent employee relations strategies could be used to improve performance.

1.4     Research Question

In the context of this study, the research asks the following questions:

  1. What is the extent of these organizational practices of employee relations?
  2. What are the components of employee relations in this organization?
  3. How can employee relations strategies improve organizational performance?




1.5     Research Hypotheses

The hypotheses will be testing the significant of the research question base on the following:

H1     Organizational practices of employee relation have a positive effect on organizational performance.

H0     Organizational practices of employee relation have no positive effect on organizational performance.

H    Employee relations has some component that significantly affects organizational performance.

H0     Employee relations has no component that significantly affects organizational performance.

H1         Employee relation strategies has a positive effect on organizational   performance.

H0         Employee relation strategies has no positive effect on organizational performance.



1.6     Significance of the Study

To the organization, it will help identify means of having better employee relations. It offers some useful information about employee relation that can be used for further scientific research.

To the researcher, it can contribute to build up researcher’s knowledge and understanding on the aspect of employee relation by providing awareness to the examined organizations about employee relation and how it affects organizational performance.

To the reader, it will widen his/her knowledge on how employee relation should practice in organization.

To the employees, it will help them to know how there can be able to relate with one another within the organization which will help them in making their work less stressful and it will also help them to know the better ways to get their work done more effectively and efficiently.

1.7     Scope of the Study

The study was done mainly in Thinkers’ Corner where the researcher was able to get all the relevant individuals.


1.8     Limitation of the Study

In the process of carrying out the study, the researcher encounter the following difficulties:

Collection of Population Sample: The researcher found it difficult to collect the population sample from the proposed company due to some privacy. It was after some series of verification through a letter submitted to the company by the researcher which serve as a means of evidence showing that the population were meant for academic purpose only.

Administration of Questionnaire: The researcher also at first meet for the distribution of the research questionnaire through the help of the proposed Company’s Administrative manager was turned down. It was when the researcher have to go back there with the Head of Department that the questionnaire was administered and was collected after 1 week and 5 days.

1.9     Definition of Terms

1.8.1  Employee: These are the people spending their time, energy working within an organization in exchange for money. It is a person who is hired to provide services to a company on a regular basis in exchange for compensation and who does not provide these services as part of an independent business. It is also an Individual who works part time or full time under a contract of employment, whether oral or written, express or implied, and has recognized rights and duties.

1.8.2  Employee Relation: It is a tripartite (it involve the employer, employee and the government) relationship that exists within an organization. It can also be seen as a relationship between the employers and the employees which makes the employee to feel comfortable in the workplace.

1.8.3  Organizational Performance: In the ’50s organizational performance was defined as the extent to which organizations, viewed as a social system fulfilled their objectives. It can also be seen as the ability of an organization to exploit its environment for accessing and using the limited resources.

1.8.4  Job Satisfaction: It is referred to job satisfaction as the positive feelings and attitudes employees hold about their jobs.

1.8.5  Performance Management: Performance management is a systematic process for improving organizational performance by developing the performance of individuals and teams. It is a means of getting better results by understanding and managing performance within an agreed framework of planned goals, standards and competency requirements. Performance management is defined as a strategic and integrated approach to delivering sustained success to organizations by improving the performance of the people who work in them by developing the capabilities of teams and individual contributors.



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