Rewards and Employee Performance in Government Agencies: Evidence from Kampala Capital City Authority (KCCA), Uganda

Abstract

Despite continued reforms in Uganda’s public service compensation framework, limited empirical evidence exists on how specific reward components shape employee performance in local government agencies. This study examined the relationship between rewards and employee performance at Kampala Capital City Authority (KCCA), with attention to compensation, performance recognition, career development opportunities, and fringe benefits. Guided by Herzberg’s Two Factor Theory and Maslow’s Hierarchy of Needs, the study adopted a mixed methods descriptive survey design. A sample of 85 employees was drawn from a population of 108 using Yamane’s formula at a 5% level of precision, with stratified and purposive sampling used to ensure representation across departments. Data were collected through structured questionnaires and interviews. Rewards were measured through compensation, recognition, career development, and fringe benefits, while employee performance was assessed using indicators such as service quality, task completion, teamwork, dependability, and creativity. Descriptive statistics, correlation analysis, and multiple linear regression were used to analyse the data. The findings showed that all reward dimensions were positively associated with employee performance. Fringe benefits emerged as the strongest predictor, followed by career development opportunities, compensation, and performance recognition. The model was statistically significant, although the findings should be interpreted with caution because the study was limited to one agency and a relatively small sample. The study concludes that both monetary and non monetary rewards matter, but a balanced reward system that strengthens employee welfare, growth, and recognition is more likely to improve performance in public institutions. Policy makers and managers in government agencies should therefore design integrated reward frameworks that combine fair compensation with career support, recognition, and benefits in order to improve motivation, retention, and service delivery.