The literature review of this study was carried out from different empirical studies derived from
global, regional, and local perspectives. The study aimed to determine compensation and
employee productivity of private higher learning institutions in Kenya. However, the

following objectives were used as a guide for the study: to examine the impact of direct-
financial compensation on employee productivity, to investigate the impact of indirect-
financial compensation on employee productivity, and to evaluate the impact of non-financial

compensation on employee productivity of private higher learning institutions in Kenya a case
of Tangaza University. The study was based on expectancy theory and equity theory. However,
the conceptual framework was drawn to indicate the relationships between independence
variables and dependence variables. Conversely, the study used a descriptive survey design
and questionnaires to collect data from a sample of 36 employees of Tangaza University where
33 respondents was a reported return rate. However, Statistical Program for Social Sciences
(SPSS) version 22 was used to get descriptive statistics for this study. The study revealed that
direct, indirect, and non-financial compensation impacts employee productivity in the
institution of higher learning. The study concludes that direct financial, indirect financial, and
non-financial benefits and other benefits enhance employees' well-being and improve
productivity. Conversely, the study recommends the review of salary structure and work output
of employees to identify whether any employees are underpaid. Similarly, incentives and
bonuses should be considered equitably distributed occasionally based on the skills and
competency of an employee to enhance productivity. the study further suggest that it will be
appropriate to extend the study to other sectors and regions in kenya to make the study more
generalized. It may also be important to ground the study on other theories, research designs
and methodologies. However, the researcher suggests these topics; Government impact on
employees' compensation and the Effect of compensation and employee turnover for further
study.