Effect of Retrenchment Practices on Performance of Surviving Employees in State Corporations of Nakuru County

Titus Wafula Simiyu, Daniel Onwonga Auka

Abstract: Organizations, both large and small, are faced with uncertain business conditions, competitive market environments and rapid technological changes. Organizations are struggling to survive and are focusing on ways to improve their performance. The main objective of this study was to examine the effects of retrenchment practices on performance of surviving employees in state corporations of Nakuru County. It examined the relationship between workforce reduction, cost cutting, communication, support, counselling and procedural justice and employee performance. To achieve this, data was collected from a sample of 253 survivors from the selected state corporations. The results indicated that retrenchment practices significantly influences employee performance. The findings reinforce the need for management to embrace due process during the retrenchment practice in order to achieve organizational goal.

Keywords: Retrenchment, Cost Cutting, Work Force Reduction, Counselling, Procedural Justice, Support