CHAPTER ONE
INTRODUCTION
1. BACKGROUND OF THE STUDY
Performance contract is an agreement between a manager and an employee about the employee’s responsibilities and behaviors during a review period. It can also be defined as an agreement between government and a public agency which establishes general goal for the agency set targets for measuring performance and provide incentives for achieving these targets (Walts, 2003).
In Government of Kenya public organization offer low quality service to its citizen despite the competition they opponents which are private sector, for government to make sure this habit of providing low quality service is put to an end, a step should be taken to increase the efficiency of the public enterprise and hence further drain on the country’s treasury resulting from his behaviors.
Judges and teachers are refusing to sign performance contract claiming that it will divide there solidarity since it will mean that they are paid according to what they produce/contribute to the organization. Teachers and judges claim that performance contract does not conform to there needs hence they cannot sign performance contract since it is a disadvantage to them (Abdulahi, 2008).
Performance in public service can be improved by designing performance contract after carefully examining and adapting to the needs of the public sector. When it does not adopt to the particular needs of the public sector most people will not accept to sign the contract, and can be seen in Kenya by most civil servants refusing to sign performance contract (Government of Kenya, 2007).
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Reasons of driving public sector while providing their service to sign up to some parameter of performance is accountability. Employees in both public and private sector on clearly defined targets, whose achievement ultimately determine their pay packages and bonus payments. According to the government