Ogega, Edinah Moraa2026-02-162026-02-162025-08https://ir-library.ku.ac.ke/handle/123456789/32444A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfiment of the Requirement for the Award of the Degree of Master of Business Administration (Human Resource Management) of Kenyatta University. August, 2025 Supervisor Priscilla NdegwaThe Kenyan banking sector plays an important role and contributes to the socio-economic growth and development of the country. However, the sector has a challenge of retaining its employees which affects its performance and sustainability. The tier I and II commercial banks have a larger customer base compared to other financial institutions. The increased workload put pressure on employees, causing low retention rates and hence focusing on job satisfaction as a solution. The general objective was to establish the effect of job satisfaction on employee retention in tier I and Tier II commercial banks in Nairobi City County. The specific objective of the study was to establish the effect of communication, promotion, work environment and remuneration on employee retention in tier I and tier II commercial banks in Nairobi City County. The main theory is Herzberg’s two factor theory and supported by expectancy, human relations and work adjustment theories. The study adopted descriptive research design and target the tier I and tier II banks. The respondents included 17 Human Resource Managers and 2,702 employees at the bank’s head offices. The study adopted the use of purposive sampling in selecting the 17 HR Managers and simple random sampling technique when selecting the 348 employees and from which 256 filled the questionnaire. The pilot test done using 18 respondent and confirmed the validity of the instrument and aggregate Alpha results of 0.7668 were above the coefficient alpha threshold of 0.7. This showed that the instrument was reliable and fit for use. The conducted descriptive analysis results showed that at average mean scores of 3.88 for communication, 3.496 for promotion, 3.549 for work environment and 3.382 for remuneration as respondents confirmed it led to better retention of employees at mean scores of 3.711. The researcher also did multiple regression analysis and found that 62.3% variation in employee retention was influenced by the job satisfaction. The study also found that communication had the largest effect based on beta coefficient results of β = 0.793, followed by work environment at β = 0.604, then promotion at β = 0.559 and lastly remuneration at β = 0.317. Based on these results, the study concluded that job satisfaction namely, communication, promotion, work environment, and remuneration positively and significantly predicted employee retention. The job satisfaction aspect resulted in improved employee retention in the tier I and tier II commercial banks. The study recommended use of advanced ICT systems to ease communication in the bank, and abiding by the building and construction requirements in creating a good work environment in seeking to retain more employees. The employees’ promotion should be free and fairly distributed as a motivation and reward factor for retaining top performers. The study further suggests the banks to remunerate its employees by having salaries, bonuses and benefits that commensurate with efforts put and industry practices. The study is significant since by retaining employees, the commercial banks can operate optimally, grow and contribute to economic development of the nation.enThesis