Transformational Leadership, Welfare Packages, and Employee Performance: The Moderating Role of Compensation in Nigerian Public Universities (2015-2025)

Abstract

This study examined the moderating role of compensation on the relationship between transformational leadership, welfare packages, and employee performance in Nigerian public universities from 2015 to 2025. The persistent decline in employee performance, evidenced by sixteen ASUU strike actions and over 700 lost academic days during the study period, necessitated this research. The broad objective was to examine the moderating role of compensation on the relationship between transformational leadership, welfare packages, and employee performance. Two theories guided the study: Transformational Leadership Theory (Burns, 1978; Bass, 1985) and Expectancy Theory (Vroom, 1964). A quantitative research methodology was adopted using a cross-sectional survey design. Primary data were collected through a structured questionnaire administered to 300 academic and senior non-academic staff selected from six federal universities using multi-stage sampling. Descriptive statistics, including frequencies, percentages, means, and standard deviations, were used to analyse the data. The findings revealed that transformational leadership was perceived positively by 83.3 percent of respondents, yet 66.7 percent reported inadequate welfare packages, including health insurance, housing allowance, and study leave. Compensation systems were perceived as unfair, with 50 percent reporting that promotion arrears were not paid promptly and 50 percent stating their compensation was unfair compared to other federal universities. Despite these challenges, employee performance remained high, with 100 percent completing duties on time and mentoring junior colleagues, and 83.3 percent publishing research regularly. The study concluded that compensation did not currently function as a significant moderator because performance remained high regardless of compensation inadequacies, suggesting that professional commitment rather than material incentives sustained performance. The study recommended that the Federal Government should mandate payment of promotion arrears within three months, the National Universities Commission should enforce a minimum welfare package benchmark, and a bi-annual leadership-welfare-compensation audit should be institutionalised across all federal universities.