CHAPTER ONE

INTRODUCTION

This research consist of study overview, company profiles, research problem,

research question, research objective, scope of the study, significant of the study,

definition of terms, literature review, research design, research framework, research

hypotheses, data sources, sampling design, measurement and scaling, questionnaire

design, data collection and preparation, data analysis, pilot testing, questionnaires

distributed, returned and completed, frequency analysis, descriptive statistics,

hypothesis test, conclusions, major findings, limitation of study, recommendation,

bibliography, and appendixes.

1.0 Overview of the Study

Henry Ford once said “You can take my factories, burn up my buildings, but give

me my people and I’ll build the business right back again”. The word people in the

quote have highlighted the importance of employees as one of the organization

assets and every profitable growth come from the power of this internal asset. Thus,

it has become a concern for employers nowadays to retain their valuable asset.

Recruitment activities have cost the employers huge amount of dollars and yet,

another additional one million dollar will be added to bear the losing cost of the

employees (Ramlall, 2003). In addition, total costs that associated with one

employee are a year and the amount is different based on the occupation grades. A

study conducted by C. Sinha and Sinha (2012) revealed that employee retention

matters are coming into existence as the most crucial workforce management

1
challenges in the near time to come and impending shortage of highly-skilled

employees will hinder employers’ ability to remain competitive.

Earlier studies on employees’ mobility mostly focused on analysing the causes

of employee’s turnover intention and the answers obtained are varied from each

organization. Most of the published written reports have focused on the components

that influenced employees to stay longer with the organization (Zachariah & Roopa,

2012). Besides, other reasons that draw employer's interest in retention is that over

the next few years, the Baby Boomers (age 40 to 58) with 76 million population will

be retiring, and there are only 44 million people of Generation X (age 25 to 34)

available for work, shows a lot fewer people are available to work (Heathfield, 2005).

The latter statement has strengthened the importance of employee retention for the

organization.

According to Cases on Management and Organizational Behaviour in Arab

Context (G. Khoury & Khoury, 2014) retention have been implemented in MALAK

Technologies Ltd. During the organization formation, there was no specialized HR

function being implemented. There were voluntary turnover in MALAK and the

reasons were difficult to identify and articulate. Hence, the cofounder of the

organization had implemented HR practices to retain his talented staffs. Some of the

practices that were implemented are effective selection procedures, organizational

culture, challenging assignments and compensation.

1.1 Company Profiles

Universiti Sains Islam Malaysia (USIM) gained approval from the Cabinet on

11th June 1997. The university was formerly known as Kolej Universiti Islam

Malaysia (KUIM) in 2000 and was officially upgraded as a university named

2
Universiti Sains Islam Malaysia (USIM) in 2007. It has two campuses; the main

campus located at Nilai, Negeri Sembilan while the branch campus situated at

Pandan Indah, Kuala Lumpur. The branch campus is specialized for Faculty of

Medicine and Health Sciences (FPSK) and Faculty of Dentistry (FPg). USIM

provides innovative facilities as well as experienced and qualified lecturers to its

students.

The university aims to promote, preserve, and heighten Islamic-based studies

into the Malaysian education system. The language requirement used in USIM

are Arabic and English language as well as the national language. Up to today,

USIM have eight faculties as listed below:

Faculty of Quranic and Sunnah Studies (FPQS)

Faculty of Syariah and Law (FSU)

Faculty of Leadership and Management (FKP)

Faculty of Economics and Muamalat (FEM)

Faculty of Science and Technology (FST)

Faculty of Medicine and Health Sciences (FPSK)

Faculty of Major Languages Studies (FPBU)

Faculty of Dentistry (FPg)

The academic programmes are developed with the idea that Islamic studies

should be taken as a base for all academic programmes and it should cover and

surpass all branches of knowledge that includes economy, law, syariah,

language, dakwah, management, Quran and Sunnah, Fiqh, counselling,

communication, medicine, science and information technology, dentistry and

accounting. Through this unique approach, the university hoped that wider

opportunities for Islamic stream students could be opened and these graduates

will not be bewildered on the traditional scope of Islamic Studies itself.

3
 As of 27th March 2013 there are total of 9922 students for tamhidi,

undergraduate, and postgraduate students, 576 academic staffs, and 778 non-

academic and supporting staffs (Universiti Sains Islam Malaysia, 2014).

This research focused on administrative employees of the Chancellery

Building of Universiti Sains Islam Malaysia (USIM), Nilai which consists of eight

departments:

Centre of Industry Liaison and Commercialization (PHIP)

Corporate Planning & Quality Management Centre

Vice-Chancellor's Office

Department of Registrar

Bursary division

Pusat Pembangunan Pembiayaan Wakaf (PPPW)

Liaison Department (JUU)

Strategic Communication Centre (STRACOMM)

Table 1.1 presented below shows USIM’s employee mobility for the past six

years.

Table 1.1: USIM’s Resignation Data

Year Employees' Resignation Percentages

2008 19 15%

2009 19 15%

2010 28 22%

2011 23 18%

2012 21 16%

4
 2013 19 15%

From Table 1.1, it indicates the employee mobility out from the university is

fluctuating from year 2008 until the year 2013. The highest numbers are during

2010 with a frequency of 28 people per year, while the least is with 19

frequencies for the year 2008, 2009, and 2013. Since the numbers are

fluctuating, it shows that the university is not able to retain its employees.

Therefore, the researcher has decided to study the factors that make the existing

employees stay with the university. Since there are many possible factors that

contribute to employee's intention to stay with the university, the researcher has

limited the factors to four Human Resource Practices (HRPs) only. The four

HRPs chosen are employee training, appraisal system, employee compensation,

and employee empowerment.

1.2 Research Problem

This study is investigating the relationship of employee training, appraisal

system, employee compensation, and employee empowerment with employee

retention at Universiti Sains Islam Malaysia (USIM), Nilai.

1.2.1 Research Questions

This research proposes four research questions, which are:

Is there a relationship between employee training and employee

retention?

Is there a relationship between employee appraisal system and

employee retention?
5
 Is there a relationship between employee compensation and

employee retention?

Is there a relationship between employee empowerment and

employee retention?

1.3 Research Objectives

There are two types of objectives in this research which are general objective

and specific objectives.

1.3.1 General Objective

To investigate the relationship between human resource practices

and employee retention at Universiti Sains Islam Malaysia (USIM), Nilai,

Negeri Sembilan.

1.3.2 Specific Objectives

To investigate the relationship between employee training and

employee retention at Universiti Sains Islam Malaysia (USIM), Nilai,

Negeri Sembilan.

To investigate the relationship between appraisal system and

employee retention at Universiti Sains Islam Malaysia (USIM), Nilai,

Negeri Sembilan.

To investigate the relationship between employee compensation and

employee retention at Universiti Sains Islam Malaysia (USIM), Nilai,

Negeri Sembilan.

6
 To investigate the relationship between employee empowerment and

employee retention at Universiti Sains Islam Malaysia (USIM), Nilai,

Negeri Sembilan.

1.4 Scope of the Study

The scope involved only administrative employees in the Chancellery

Building of Universiti Sains Islam Malaysia (USIM), Nilai. The title of the research

is Employee Retention at Universiti Sains Islam Malaysia (USIM), Nilai, Negeri

Sembilan. There will be five variables. Four independent variables which are

employee training, employee appraisal system, employee compensation and

employee empowerment. There is only one dependent variable; employee

retention at Universiti Sains Islam Malaysia (USIM), Nilai.

1.5 Significance of the Study

This research is benefited to several groups:

1.5.1 To the Researcher

The study helps the researcher to enhance the knowledge concerning

employee retention, which has variance findings for different organizations.

1.5.2 To the Students.

The research is significant for students that will be doing their thesis

paper during their final year. This is because the research could be as an

example of how to prepare a thesis paper in the future.

7
 1.5.3 To the HR Practitioner.

The findings of this research would have acted as add in information

about employee retention in other public sector context.

1.5.4 To University Sains Islam Malaysia (USIM), Nilai.

Lastly, this study would bring significance to the organization. They will

be aware about the employee retention strategies. They could take an

appropriate action to retain their valuable human capital that will lead to profit

maximization.

1.6 Definition of Terms

1.6.1 Retention

Retention is about keeping the right people at the right job at the right place

at the right time for every organization (Schuler & MacMillan, 1984).

1.6.2 Human Resource Practices

HR practices (HRPs) refer to organizational activities directed at managing

pools of human resources and ensuring that the resources are employed

towards the fulfilment of organizational goals (Tiwari & Saxena, 2012) in

terms of training, appraisal system, compensation, employee empowerment.

1.6.3 Training

Systematic acquisition and development of the knowledge, skills and attitudes

required by employers to adequately perform an assigned job or task to boost

performance in the job environment (Hong, Lam, Ramesh Kumar, &

Kadirasan, 2012).
8
1.6.4 Appraisal System

The process of inspecting and evaluating an individual’s performance in his

duty to facilitate the decision of career development of the individual (Hong et

al., 2012).

1.6.5 Compensation

Monetary and non-monetary benefits that awarded by the employers to their

employees (Hong et al., 2012).

1.6.6 Empowerment

The opportunity and authority that an employee has in accomplishing his or

her work given by the employers (Companion Website, 2014).

9
 CHAPTER TWO

LITERATURE REVIEW

2.0 Introduction

This chapter explains the literature review of the dependent variable which is

employee retention and the independent variables such as employee training,

appraisal system, employee compensation, and employee empowerment.

2.1 Retention

Theoretically, retention is keeping the right people at the right job at the right

place at the right time for every organization (Schuler & MacMillan, 1984). In other

words, it is about keeping good people within the organization (Hassan, Hassan, Din

Khan, & Naseem, 2011). Hong et al. (2012) viewed retention as policies and

practices that a company used to prevent valuable employees from leaving their job

by considering the measures that could encourage its employees to remain in the

organization for the maximum period of time. Govaerts, Kyndt, Dochy, & Baert

(2011) outlined employee retention as the effort made by an employer to keep its

desirable workers in order to meet business objectives.

The definitions presented above show that employee retention is important for

organization nowadays (Hytter, 2007) due to difficulty in replacing talents and

achieving competitive advantage over competitors (Hassan et al., 2011). Moreover,

the baby boomers generation are gradually retiring and will cause loss of knowledge

which urges the organization to retain the talent within the remaining employees

(Govaerts et al., 2011). To retain the employees, Human Resource Management

10
Practices (HRP) play an important role (Irshad, 2011) and could be implemented in

corporate retention programs (Liang, 2013). The statement is further supported by

De Vos and Meganck (2008) that the HR practices that organizations develop could

reduce voluntary turnover rates among the employees.

There are numbers of HRP that could be implemented by organizations.

However, the researcher has chosen only four HRP to be used in this research. The

HRPs chosen are employee training, appraisal system, employee compensation and

employee empowerment.

2.2 Training

Based on Hong et al. (2012) training is systematic acquisition and development

of knowledge, skills and attitudes required by employees to adequately perform an

assigned job or task to boost performance in the job environment.

Hytter (2007) in Retention Strategies in France and Sweden and Irshad (2011)

proved that training appear to have more direct influence for employee retention

strategies. It is further supported by Aslam, Mahmood, Hafeez and Hussain (2011)

that most people are agreeing employee training is the priority for the bank in

retaining its employees. Chapman (2009) also entails a human resource plan that

includes training, could help organizations improve their ability in retaining good

employees since most of the retention practice is focusing on training (De Vos and

Meganck, 2008). However Govaerts et al. (2011) has showed that training has an

indirect influence on employee retention.

11
2.3 Appraisal system

Liu and Dong (2012) describe an appraisal system as seatbelt-most people

believe that it is necessary, but they don’t like to use it. Hong et al. (2012) define the

appraisal system as a process of inspecting and evaluating an individual’s

performance in his duty to facilitate the decision of career development of the

individual.

Mittar and Saini (2014) mentioned a fair appraisal system would give effect to

employee retention and has been supported in a study conducted by Miah and

Mominul Haque Talukder (2012) indicates there is a significant positive relationship

between employee retention and performance appraisal process. Besides, Rahman

(2012) studied that the presence or absence of organizational justice in appraisal

process would influence employees’ (Malaysian engineers) intention to stay longer

with the organization. However, research conducted by Poon (2004) produced two

different results; when employees perceived performance was manipulated by

affective reasons, it influenced intention to quit, but if the performance was

manipulated for rewarding purposes, the turnover intention was not affected.

2.4 Compensation

In this research, compensation is defined as monetary and non-monetary

benefits that awarded by the employers to their employees (Hong et al., 2012).

Ghosh, Satyawadi, Joshi, and Shadman (2013) stated compensation package was

significant factors for employees to continue working with the company because

rewards and compensation were found to reduce non-management employee

turnover. The latter is further supported by Shoaib, Noor, Tirmizi, and Bashir (2009)

that organization’s reward could affect the employees’ desire to remain employed
12
and correlates positively with employee retention. However, Sengupta and Dev

(2013) wrote in their study that the most significant retention predictors is not

monetary rewards which is confirmed by other studies. Their statement is backed by

Irshad (2011) that stated money satisfies the employee, but it is not sufficient to

retain them.

2.5 Empowerment

This research defines empowerment as the authority and opportunity that an

employee has in accomplishing his or her work (Companion Website, March 24,

2014). Authority is about pushing legitimate power down to lower levels for decision

making purpose. Opportunity means freedom from bureaucratic barriers.

Govaerts et al. (2011) identified that empowerment relates to employee

retention. The statement is strengthened by Aslam et al. (2011) that 56 percent

participants would choose an organization that empowered its employees and

welcomes good ideas from them. Besides, empowerment is contributing to

commitment of employees to stay with the organization (Rahman, 2012; Sengupta &

Dev, 2013) and considered as one of human resource management critical success

elements (Jarrar & Zairi, 2002). Moreover, referring to Ntshangase and Parumasur

(2013) organization that lack with empowering culture will cause the talented

employees to leave the organization.

13
 CHAPTER THREE

RESEARCH METHODOLOGY

3.0 Introduction

This chapter elaborates on the design used, research framework, research

hypotheses, data sources, sampling design, measurement and scaling, questionnaire

design, data analysis, and pilot testing.

3.1 Research design

Research design is a blueprint for the collection, measurement, and analysis of

data, based on the research questions of the study (Sekaran & Bougie, 2013).

This research used descriptive study and correlation investigation because it

attempts to identify the relationship between Human Resource Practices (HRPs) and

employee retention.

14
3.2 Research framework

Figure 3.1: Research Framework

3.3 Research hypotheses

There are four hypotheses proposed in this research:

H1: There is a relationship between employee training and employee retention at

Universiti Sains Islam Malaysia (USIM), Nilai, Negeri Sembilan.

H2: There is a relationship between appraisal system and employee retention at

Universiti Sains Islam Malaysia (USIM), Nilai, Negeri Sembilan.

H3: There is a relationship between employee compensation and employee

retention at Universiti Sains Islam Malaysia (USIM), Nilai, Negeri Sembilan.

15
H4: There is a relationship between employee empowerment and employee

retention at Universiti Sains Islam Malaysia (USIM), Nilai, Negeri Sembilan.

3.4 Data sources

This research used both primary data and secondary data.

3.4.1 Primary Data

Sekaran and Bougie (2013) defined primary data, as data collected first-

hand for subsequent analysis to find solutions to the problem researched. The

data were obtained from questionnaire survey which had been distributed to

targeted respondents.

3.4.2 Secondary Data

Referring to Sekaran and Bougie (2013), secondary data is data that

already exist and do not have to be collected by the researcher. The data used

in this research were obtained from online resources such as Emerald Library

Database of UiTM Seri Iskandar, Google Scholar website, and USIM’s intranet

portal such as eIRIS and MUNAZZIM.

3.5 Sampling design

3.5.1 Population

Population is described as the entire group of people, events, or things

that the researcher's desire to investigate (Sekaran & Bougie, 2013). The

population of this research was administrative employees in the Chancellery

16
Building of Universiti Sains Islam Malaysia (USIM), Nilai which has 160

employees.

3.5.2 Sample size

Sekaran and Bougie (2013) illustrate sample size as the actual number of

subjects chosen as a sample to represent the population characteristics. Based

on Krejcie and Morgan (1970) table shown in Table 3.1 below, the sample sizes

were 113 of the population of 160.

Table 3.1: Krejcie and Morgan Table

17
 3.5.3 Sampling frame

The sampling frame of this research was obtained from USIM’s databases

that provide a list of names of the university’s administrative employees.

3.5.4 Sampling method

A quota sampling method had been employed in this research. The

variable used to measure the quota is the size of the department in the

Chancellery Building of Universiti Sains Islam Malaysia (USIM), Nilai. As the

size of the department increased, more sets of questionnaire are distributed.

For example bursary department has 40 employees while the registrar

department has 20 employees. Thus, 40 sets of questionnaire were distributed

to bursary department and 20 sets of questionnaires to registrar department.

3.6 Measurement and scaling

A close-ended question has been used in the questionnaire which allow the

respondents to make an option to the given statement. The researcher used a five

point Likert Scale to measure employee retention at Universiti Sains Islam Malaysia

(USIM), Nilai.

3.7 Questionnaire design

The questionnaire was adopted and adapt from two resources which are Kabir

and Parvin (2011) and Hong et al. (2012). The questionnaire was separated into two

sections which is Section A and Section B. Section A was about demographic

information of the respondents. It used nominal scale that allows the researcher to

18
assign subjects to certain categories or groups. Variables asked in Section A were

gender, age, race, marital status, and years of service. On the other hand, Section B

consists of 27 questions of all variables which are employee training, appraisal

system, employee compensation, employee empowerment, and employee retention.

The variables were measured by using a Likert Scale that examines how strongly the

respondents agree or disagree with the statements. The Likert items used are 1=

Strongly Disagree, 2= Disagree, 3= Somewhat Agree, 4= Agree, 5= Strongly

Disagree.

3.8 Data collection and preparation

The first step used in data collection and preparation is data coding that involves

assigning a number to the participants’ responses so that the data could be entered

into a data base (Sekaran & Bougie, 2013). The next step is data entry where the

data collected is saved in the Statistical Package for the Social Science (SPSS 20)

for further analysis.

3.9 Data analysis

Analyses used are reliability analysis, frequency analysis, descriptive statistics

and hypothesis testing. The researcher also used regression analysis to analyse the

relationship between employee training, appraisal system, employee compensation,

employee empowerment and employee retention.

19
3.9.1 Reliability test

The reliability of a measure is an indication of the stability and

consistency with which the instrument measures the concept (Bougie &

Sekaran, 2013).

Table 3.2: Reliability Table

Cronbach’s alpha Internal Consistency

α ≥ 0.9 Excellent

0.7 ≤ α < 0.9 Good

0.6 ≤ α < 0.7 Acceptable

0.5 ≤ α < 0.6 Poor

α < 0.5 Unacceptable

3.9.2 Frequency analysis

An analysis that produces a table of frequency counts and

percentages for the value of an individual variable (Bougie & Sekaran, 2013).

It is used in this research to provide descriptive information about the data

such as frequency, and distribution of the responses, and to summarize the

responses to each question (Bougie & Sekaran, 2013).

3.9.3 Descriptive statistics

Descriptive statistics that are used in this research are minimum,

maximum, mean and standard deviation, which provide descriptive

information about a set of data (Bougie & Sekaran, 2013).

20
 3.9.4 Hypothesis test

For hypothesis test, the multiple regression technique is used where a

researcher uses more than one independent variable to explain variance in

the dependent variable. It provides a means for assessing the degree and

the character of the relationship between the independent variables and a

dependent variable (Bougie & Sekaran, 2013).

3.10 Pilot testing

Table 3.3: Pilot Test

Variables Cronbach Alpha Value

Retention 0.82

Employee Training 0.72

Appraisal System 0.84

Employee Compensation 0.87

Employee Empowerment 0.70

A pilot test has been conducted to determine whether the questions are able

to measure the dimensions of each variable. Based on Malhotra (2008) sample size

for pilot test is normally small, ranging from 15-30 respondents. Based on the Table

3.3, value of cronbach alpha of all variables presented are above 0.7. Thus, all the

questions are reliable.

21
 CHAPTER FOUR

RESEARCH ANALYSIS

4.0 Introduction

Chapter four presented the results and finding of the research. The discussion

evolves on the number of questionnaires distributed, returned and completed,

frequency analysis, descriptive statistics, and hypothesis test.

4.1 Questionnaire distributed, returned and completed

Table 4.1: Questionnaire

Questionnaire Distributed 134

Questionnaire Returned 134

Questionnaire Completed 113

Referring to Table 4.1, 134 set of questionnaires has been distributed and

returned, but only 113 sets of questionnaires were completed. This is because,

some of the respondents had returned empty questionnaires, refused to participate in

the survey, not completed the questionnaires, having outstation and on leave.

22
4.2 Frequency analysis

Table 4.2: Frequency analysis

Demographic Profiles Frequency Percent

Gender Male 35 31.0

Female 78 69.0

Age 21-25 23 20.4

26-30 40 35.4

31-35 41 36.3

36-40 4 3.5

41-45 3 2.7

46-50 2 1.8

Race Malay 112 99.1

Others 1 0.9

Marital Status Single 36 31.9

Married 77 68.1

Years of Service Less than 1 year 14 12.4

1-5 years 31 27.4

6-10 years 46 40.7

11-15 years 21 18.6

23
 20 years above 1 0.9

The Table 4.2 displays result of frequency analysis for all the demographic

profiles asked in the questionnaire. Gender profile shows that most of the

participants are female with frequency 78 (69 percent). In terms of age, a group of

31-35 years old is the majority with a frequency of 41 (36.3 percent) followed by a

group of 26-30 years old with a frequency of 40 (35.4 percent). The Malays are the

majority respondents with a frequency of 112 (99.1 percent). There are 77 married

respondents with 68.1 percent. Lastly, 46 of the respondents have worked since 6-

10 years, which equal to 40.7 percent.

4.3 Descriptive statistics

Table 4.3: Descriptive Statistics

N Minimum Maximum Mean Std. Deviation

Training 113 1.60 5.00 3.2372 .63389

AppSys 113 2.20 5.00 3.5947 .55771

Compensation 113 1.86 5.00 3.1138 .60070

Empowerment 113 1.80 5.00 3.1097 .60651

Valid N (listwise) 113

Table 4.3 above explains on the descriptive statistics of all the independent

variables. There are 113 questionnaires distributed and Likert items used in the

research are 1= Strongly Disagree, 2= Disagree, 3=Somewhat Agree, 4= Agree,

and 5= Strongly Agree. Employee training has a minimum value of 1.60, the

24
maximum is 5.00 and the mean is 3.2372 with standard deviation 0.63389 which

shows most of the respondents chose somewhat agree. The second independent

variable is appraisal system which has a minimum value of 2.20, maximum value of

5.00 and a mean of 3.5947 with standard deviation 0.55771 that displays majority of

the respondents are agreeing with the variable. Third is employee compensation that

has a minimum value of 1.86, maximum value of 5.00, mean of 3.1138 with standard

deviation 0.60070 which means the respondents are somewhat agreeing with

compensation factor. Lastly is employee empowerment which has a minimum value

of 1.80, maximum value of 5.00, and mean of 3.1097 with standard deviation

0.60651. The mean value proved that the respondents have somewhat agreed with

the empowerment factor.

4.4 Hypothesis test

Table 4.4: Hypothesis Test

R 0.71

R Square 0.503 (50.3 percent)

95.0%
Unstandardized Standardized
Confidence
Coefficients Coefficients
Model t Sig. Interval for B

Std. Lower Upper

B Beta
Error Bound Bound

(Constant) .213 .344 .620 .537 -.468 .894

Training .097 .096 .088 1.016 .312 -.092 .287

1 AppSys .485 .110 .388 4.429 .000 .268 .702

Compensation .064 .096 .055 .665 .508 -.126 .253

Empowerment .397 .094 .345 4.235 .000 .211 .583

25
 Based on the result presented in the Table 4.4, the R value 0.710 which

shows positive, strong relationship between employee training, appraisal system,

employee compensation, employee empowerment, and employee retention at USIM,

Nilai. Therefore, 50.3 percent of employee retention can be explained by employee

training, appraisal system, employee compensation, and employee empowerment.

Hypothesis 1:

H0: There is no relationship between employee training and employee retention at

Universiti Sains Islam Malaysia (USIM), Nilai.

H1: There is a relationship between employee training and employee retention at

Universiti Sains Islam Malaysia (USIM), Nilai.

Table 4.4 expressed the unstandardized B coefficients for employee training is 0.097

which shows weak, positive relationship.

Since the significant value is 0.312 which more than 0.05, it means the null

hypothesis is accepted. Thus, there is no relationship between employee training

and employee retention.

Hypothesis 2:

H0: There is no relationship between appraisal system and employee retention at

Universiti Sains Islam Malaysia (USIM), Nilai.

H2: There is a relationship between appraisal system and employee retention at

Universiti Sains Islam Malaysia (USIM), Nilai.

26
As shown in Table 4.4, the unstandardized B coefficients for appraisal system is

0.485 with moderate, positive relationship.

Its significant value is 0.000 which less than 0.05. Thus, H2 is accepted and there is

a relationship between appraisal system and employee retention.

Hypothesis 3:

H0: There is no relationship between employee compensation and employee

retention at Universiti Sains Islam Malaysia (USIM), Nilai.

H3: There is a relationship between employee compensation and employee

retention at Universiti Sains Islam Malaysia (USIM), Nilai.

Table 4.4 displayed the B of unstandardized coefficient for employee compensation

is 0.064, indicates weak, positive relationship.

The significant value of employee compensation is 0.508 which is greater than 0.05.

This indicates that the null hypothesis is accepted. Thus, there is no relationship

between employee compensation and employee retention.

Hypothesis 4:

H0: There is no relationship between employee empowerment and employee

retention at Universiti Sains Islam Malaysia (USIM), Nilai.

H4: There is a relationship between employee empowerment and employee

retention at Universiti Sains Islam Malaysia (USIM), Nilai.

27
From Table 4.4, it shows that the unstandardized B coefficients is 0.397 with

moderate, positive relationship.

Since the significant value is 0.000 which less than 0.05, the H4 is accepted. Hence,

there is a relationship between employee empowerment and employee retention.

28
 CHAPTER FIVE

CONCULUSIONS AND RECOMMENDATIONS

5.0 Conclusions

The objective of this research is to investigate the relationship between Human

Resource Practices (HRPs) and employee retention at Universiti Sains Islam

Malaysia (USIM), Nilai, Negeri Sembilan. After analysing the data obtained from the

survey, it shows that the majority of the administrative employees in the Chancellery

Building of USIM, Nilai have chose appraisal system and employee empowerment as

reasons that make them to stay with the company.

5.1 Major findings

Table 5.1: Findings

Hypotheses Findings

H1: There is a relationship between employee training and

Not Supported
employee retention at Universiti Sains Islam Malaysia

(USIM), Nilai.

H2: There is a relationship between appraisal system and

Supported
employee retention at Universiti Sains Islam Malaysia

(USIM), Nilai.

29
H3: There is a relationship between employee compensation
Not Supported
and employee retention at Universiti Sains Islam Malaysia

(USIM), Nilai.

H4: There is a relationship between employee empowerment

Supported
and employee retention at Universiti Sains Islam Malaysia

(USIM), Nilai.

Table 5.1 above presents the major findings of the research. There are four

hypotheses that had been proposed by the researcher but only two hypotheses are

supported which are appraisal system and employee empowerment while employee

training and employee compensation are not supported. Compared to research

conducted by Hong et al. (2012), there were three hypotheses that were supported

which are employee training, appraisal system, and employee compensation

5.2 Limitations of the study

a) Scope of Study

There are many categories of public sector in Nilai but this research only

focus to administrative employees of the Chancellery Building of Universiti Sains

Islam Malaysia (USIM), Nilai. The scope is too narrow and could not be

generalized in other public sector.

30
 b) Data Resources

The number of administrative employees is obtained from Universiti Sains

Islam Malaysia (USIM) 2013 yearly report and database. The information was

last updated on 27th March 2013 and the data obtained is not updated with the

latest information.

5.3 Recommendations

5.3.1 University

It is recommended to USIM, Nilai to do some improvisation with its

retention strategies by focusing on appraisal system and employee

empowerment. This is because; along the five months of the industrial

training the researcher noticed that the employees have the opportunity to

determine the way they do their job and they perceived the university

appraisal system is fair. This culture has retained the employees with the

university longer. Even though employee training and employee

compensation showed insignificant relationship, USIM should not totally

neglect the factors. This is because; the preference of the employees could

change over a time period.

5.3.2 Future research

It is recommended to future researchers to test the theory in a wider

scope since the population of this research is only focusing on administrative

employees of the Chancellery Building of USIM, Nilai which means the result

could not be generalizable to other settings. It is also suggested to test the

insignificant independent variables of this research and adding up the number

of other HRPs used.

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