ABSTRACT

 This study focused on "Effects of Compensation as a tool for enhancing employees performance" A study of United Bank for Africa, Abia State. The specific objectives of the study are to:Determine the factors that improves the motivation of the employees in United Bank for Africa and First Bank Pie.Examine the effect of compensation plan on Organizational productivity in United Bank for Africa and First Bank Pie. Ascertain the challenges faced in implementation of employees' compensation package. The population 576 staff from which 236 was derived as the sample size using Taro Yamane's formulaat 5% error tolerance and 95% level of confidence. Instrument used for data collection was primarily questionnaire and interview. Out of 236 copies of questionnaire distributed, 214 copies were returned while 22 were not returned. The hypotheses were tested using Pearson's CorrelationCoefficient, ANO VA methodof data analysis and Statistical Package for Social Science (SPSS) tool. The major findings are that clear understanding of the compensation plans of the organization outlined and duly communicated to the employees serve as a mechanism that improves employees' performance in the selected financial institutions(R =0.814; adjusted R 2 =0.814; F.cal=930.242; p=0.000; (p<0.05 .at significant level)., there is significant effects of compensation plans of the organization that has positively improved her corporate image, profitability, productivity and organizational goodwill in the selected financial institutions(R2 =0.861; adjusted R2=0.860; F.cal=l309.369; p=O.000a; (p<0.05 at significant level). There is less or no attention to recognize the hardworking employees, enthronement of mediocrity, unnecessary delay in dispensing of fringe benefits adversely affects implementation of compensation plans of the organization in the selected financial institutions in Abia State,. (R2 =0.873; adjusted R2=0.872; .cal=1455.271; p=0.000a; (p<0.05 at significant level)The researcher recommended Organizations should maintain their strategies of improving her corporate image, profitability and output level through suitable compensation packages for their employees' performance.