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Working Paper Series The Triangular Supply Chain Relationship: Labour Dispatch Agencies, Hospitality Sector, and Flexible Workers – The Taiwan Experience

Ebrahim Soltani Kent Business School

Working Paper No. 213 March 2010

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The triangular supply chain relationship: Labour dispatch agencies, hospitality sector, and flexible workers – the Taiwan experience Ebrahim Soltani Kent Business School, University of Kent, Canterbury, Kent CT2 7PE, UK [email protected] Abstract Much has been written on the nature of labour flexibility in the Western context and the extent to which it benefits employers in terms securing them cost-effective operations and flexible workers by offering them contingent work arrangements. Absent in this debate has been any examination of the nature and extent of labour flexibility in the non-Western context. This paper aims to broaden the debate and examines the current application of labour flexibility practices and its resultant implications in the novel context of Taiwan – with a particular focus on the hospitality industry. The choice of hospitality industry is in line with the recent CEPD’s1 call for labour dispatch agencies to be considered as a promotional service industry among twelve categories of services. Data derived from focus group studies and individual in-depth interviews at four hotels and their partner labour dispatch agencies elicited the triangular relationship among labour dispatch agencies, client hotels, and agency workers. In contrast to previously similar research of the Western context where labour flexibility was primarily seen to secure lower labour costs, it was found that tight managerial control over the flexible workforce plays a crucial role in adopting contingent work arrangements. Moreover, the results indicate that flexible workers are regarded as a cost rather than being considered as the rhetoric of human capital. Key Words: Labour Dispatch Agency, Labour Flexibility, Hospitality Sector, Taiwan.

Introduction With the development of economy and global competition many companies are seeking strategies to improve their sustainability. ‘Survival of the fittest’ was argued by both Herbert Spencer and Charles Darwin, as they suggested that those organisms more suited to their environment were more likely to survive. The implication of the notion of ‘survival of the fittest’ is clear-cut: there is a need on the part of all businesses in diverse contexts (of both for- and not-for-profit organizations) to be flexible enough to adjust to a changing environment. The dissemination of this notion has received greater attention across the hospitality sector, not least because of the existence of a highly fluctuating demand for the hotel services. Following the hegemony of this notion, and the need to cope with and handle the challenge of demand variation, organizational scholars have tried to explore the dynamics of labour flexibility arrangements from the viewpoints of both managers and flexible workers. Despite such interest in the topic and its resultant consequences for the three parties involved, i.e., dispatch agencies, their clients, and agency workers, few studies have examined this notion in the context of non-Western nations.

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This study addresses this issue by adopting a qualitative methodology and collecting data from multiple perspectives in the novel context of Taiwan. The present study takes, as its point of departure the observation offered by Storey (1989), Geary (1992), ESRC (2000), Forde (2001), Storrie (2002), Forde and Slater (2006) and more recent research (e.g. Soltani & Wilkinson, forthcoming; Lai, Soltani & Baum, 2008) that further research needs to be conducted to explore the perceptions of ‘those people’s working lives these practices are designed to affect’ (Geary, 1992, p. 252) and the drama of these strategies’ attempted implementation (Storey, 1989). Moreover, Forde and Slater’s (2003 and 2006) review of literature pertinent to temporary agency working (see also Forde, 2001) highlights quite different outcomes for agency workers in terms of their experiences of agency working, the implications of agency working for their personal and organizational life, and more importantly, the absence of robust evidence to confirm or refute these divergent and competing perspectives. This study contributes to our understanding of labour flexibility arrangements by empirically analyzing the challenges facing the hospitality sector in Taiwan and providing guidance for their longer-term HRM strategies. More specifically, the paper aims at understanding the triangular relationships among dispatch agencies, client hotels, and agency staff, i.e., flexible workers. It seeks to explore the phenomenon in the context of the supply of workers to client hotels by employment agencies, as a result of stimulating the development of effective labour supply chains in the hotel sector. Employment and labour dispatch in the hospitality sector The hotel industry involves those commercial organizations which provide essential human requests in terms of food, drink, accommodation and entertainment, and delivers these (either in tangible- or intangible-form) in a friendly, considerate and professional way. Such service delivery is based on the reciprocity and exchange process between the industry and the customer. Customers of a hotel, by this definition, include not only international or domestic tourists, but also local people, who require such services and products in their own locality. The nature of hospitality service in general, and hotel operations in particular, has complexities in terms of varying customer behaviour and demand for services, short lead-time between ordering and delivering, and a considerable level of human contact between service providers and customers. These characteristics meet the fundamental motivations for labour flexibility, which are reactive to demand fluctuation and deal with short-lead times. By definition, flexibility is defined as the market capability to create the conditions to return to an optimal equilibrium position after an exogenous shock. This capacity, in the context of the workforce in an organization, acts as a buffer to absorb the difference and keep the organization elastic (Amadeo & Horton, 1997). For Blyton

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(1992, p.301), labour flexibility primarily centres on ‘securing lower labour costs, tighter manning levels, higher machine utilization, greater staff mobility, and few interruptions and bottlenecks in production’. In a similar vein, Storey, Quintas, Taylor and Fowle (2002, p.10) view flexibility as a cost-reduction device or a means to meet fluctuations in demand, rather than as a tool to introduce new ideas and skills into the organization. Analyzing the literature pertinent to labour flexibility across various industries (e.g. Forde, 2001; Forde & Slater, 2003; 2006; Ward et al., 2001; ESRC, 2000; ONS, 2000; OECD, 2002; Houseman et al., 2003) highlights divergent perspectives on the nature and extent of flexible working practices and the resultant implications for both the employers and the flexible workers. While some offer a more optimistic view of its wider implications for the labour market and the whole economy, others hold a more pessimistic view in that there is nothing new in it for those who are the main subject of flexibility arrangements, i.e., the flexible workers. For example, Albert and Bradley (1997), Knell (2000), and Forde and Salter (2003), among others, talk about the positive correlation between the growth of agency working and the emergence of an ‘knowledge economy’ which is characterized by empowered workers, in that agency workers use labour market intermediaries or even directly to supply their services to various clients. In contrast, Beck (1992) and Allen and Henry (1996) view employers’ usage of agency workers and its growth as a major component of a ‘risk society’ which brings about uncertain and insecure working lives for the agency workforce (see Forde and Salter, 2006). In addition, from the point of view of the employers, the use of agency labour is stressed as a means of cost-effective operations (Pollert, 1991; Reilly, 1998; Timo, 2001; Sheridan & Conway, 2001), which in turn increases their ability to adjust their manpower levels under fluctuating and uncertain circumstances (Blyton & Morris, 1989; Mouriki, 1994; Looise, Van Riemsdijk, & de Lange, 1998; Volberda, 1998). In short, as the literature indicates, there exist quite different outcomes for the three parties involved in agency working, i.e., recruitment agency, client(s) of the recruitment agency, and the agency labour. Whatever the rationale for the adoption of flexibility arrangements may be, two broad types of labour flexibility strategies can be identified: functional (qualitative) and numerical (quantitative) flexibilities. Functional flexibility is the ability of managers to extend the range of tasks a worker can perform and it implies that the same labour force changes its activities with the organization, in both the short and medium term (Atkinson, 1985). Numerical flexibility, on the other hand, is the ability of organizations to increase or decrease employment quickly in line with fluctuations in business demand, and to improve the competitiveness of firms through adopting this flexible policy (Atkinson, 1984; Looise et al., 1998; Ruiz-Mercarder, Ruiz-Santos, & Macdonald, 2001).

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Numerical flexibility models normally employ ‘human hours’ as instruments while utilizing labour force flexibility strategies. Companies predict the requirements for human resource (based on hours needed or skill required), and adjust their human resource supplies accordingly. To achieve greater success in balancing demand and supply, companies require the ability to utilize both new employment and termination. Within these two categories, another dimension (the source of flexible labour) can be added, to construct a two-by-two matrix. From this matrix, labour flexibility is classified as internal-qualitative, internal-quantitative, external-qualitative, and externalquantitative flexibility strategies (for further details see Looise et al., 1998). Unlike most other service businesses, within the context of hospitality sector, hotels operate a 24/7/12/365 system and this, in itself, impacts upon the availability of labour, scheduling and rostering, remuneration, working conditions and employee welfare. To put it in another way, the reality of hospitality work is that much of it is required at essentially antisocial times or at times when other people are at leisure. Such a 24/7/12/365 delivery model is extremely variable and, frequently, unpredictable. One implication of such highly fluctuating demand for the hotel services is that agency workers frequently face demands on their personal time, in the interests of their customers, which take them beyond contractual or, indeed, legal norms. In consequence, management of demand variability of the hospitality industry in general and the hotel sector in particular, has engendered a great deal of theoretical and empirical efforts and has been the focus of considerable policy debate (see Geary, 1992; Atkinson, 1984, 1985; Williamson, 1985; Pollert, 1988; OECD, 1986; Pfeffer & Baron, 1988; Osterman, 1987; Handy, 1989; Marchington & Wilkinson, 2000; Golsch, 2003; Lai, Soltani and Baum, 2008). In response to such concerns over demand fluctuations in the hospitality sector, managers have turned to labour dispatch agencies to deal with matters of recruitment and employment of the qualified workforce. While there is no fixed term or definition to describe this industry within the literature, labour dispatch agencies deal with recruitment-related issues, such as advertising, selecting, recruiting, referring and expatriating. The terminologies which describe the recruitment and employment industry include temporary help service industry, intermediary industry, temporary employment agencies, agency industry, employment agencies, employment bureau, temporary work bureau, third-party mediated job-brokers, labour supply industry and head-hunter companies (Forde, 1998; Purcell & Purcell, 1998; Druker & Stanworth, 2001; Purcell & Cam, 2002). In Asian countries, such as Japan, Korea and Taiwan, this industry is normally called ‘labour dispatch industry’ or ‘dispatched work industry’ (Lin, 2006). In general, three actors are involved in labour dispatch, namely labour dispatch agencies, client companies, and agency staff. As a result of such a triangular relationship, the three parties are

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interconnected and interrelated to each other in forms of contractual and supply and demand relations. In short, the working arrangements of labour dispatch agencies could be summarized as follows: labour dispatch agencies assign their staff to work in various workplaces based on the client requests for labour force. This implies a supply and demand relationship between agencies and clients. Such a supply and demand relationship is bound by a contract in both written and oral forms, depending on preference. Furthermore, the supplying contract regulates agency staff’s working terms and conditions, responsibility of supplier (i.e. labour dispatch agencies) and clients, and service charge. However, there is no contract signed between client companies and agency staff. That is, agency staff work for labour dispatch agencies in client companies’ workplace and under both client companies’ and agencies’ supervision. Figure 1 depicts a triangle in that each of the three sides represents the three different parties involved in agency working as well as the nature of their triangular relationship Figure 1 Triangular relationship of labour dispatch

Agency

Contractual Relationship

Client

Recruit and Employment

Supervision and labour force supply Staff

From the literature, several motivations for using labour dispatch agency services can be identified, inter alia, filling staff shortages, meeting fluctuations in demand, reducing labour costs, acquiring special skills from agency professionals and test-hiring prospective new staff. In addition, the literature also suggests possible drawbacks which include higher administrative costs, higher staff turnover rate, low staff retention rate, and possible organizational animosity. These suggestions, however, may not be applicable for all sectors, not least because of different situations that occur in different industries (Purcell & Purcell, 1998; Ward, Grimshaw, Rubery, & Beynon, 2001; Druker & Stanworth, 2001; Forde, 2001). With regard to Taiwan, relevant literature suggests that the majority of clients which use labour dispatch are the hi-tech and other manufacturing industry. In other words, relatively low usage of agency labour in the service industries is argued in the literature (Cheng, 2005). Within the service industries, hospitality sector seems to have key service sector characteristics, such as intangibility,

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perishability, variability, simultaneous production and consumption, and inseparability (Schroeder, 1993; Baum, 1995; Knowles, 1998; Korczynski, 2002). These service characteristics make the sector focus efforts into the process of producing services and products, in order to make sure each stage in the production line is in a perfect condition to satisfy customers. Furthermore, demand fluctuation means that the hotel sector, a labour-intensive industry, is in need of labour flexibility. As a result of such characteristics, it is argued that the adoption of flexibility practices across the sector could have different implications and consequences for the triangular relationship among labour dispatch agencies, client hotels, and agency workers. Thus the focus upon the dynamics of triangular relationship among the three actors involved in labour dispatching services provides the opportunity to explore the extent to which such working arrangements have taken root across the sector, as long-term structural changes transform Taiwan from a traditional labour-intensive society to a more capital and technology-intensive nation. The Taiwanese context: Past, current and future In 1895 military defeat forced China to cede Taiwan to Japan. Taiwan reverted to Chinese control after World War II. Following the Communist victory on the mainland in 1949, 2 million Nationalists fled to Taiwan and established a government using the 1946 constitution drawn up for all of China. Over the next five decades, the ruling authorities gradually democratized and incorporated the local population within the governing structure. In 2000, Taiwan underwent its first peaceful transfer of power from the Nationalist to the Democratic Progressive Party. Throughout this period, the island prospered and became one of East Asia’s economic ‘Tigers’. The dominant political issues continue to be the relationship between Taiwan and China – specifically the question of eventual unification – as well as domestic political and economic reform (CIA, 2008). While the years of previous government are remembered for political tension between Taiwan and China, and Taiwan was under threat for seeking formal independence, it seems that this issue is a lower priority for the current government. Instead, despite a huge amount of suspicion on both sides, cross-strait relations have been improving and reached a new pinnacle since 2008 when the new government officially took power. Indeed, a sustainable relationship with China can be regarded as a strategic imperative for the current government as the outcome could have a profound impact on national and international interests of Taiwan. As current evidence shows, there is a genuine interest on the part of the current government in promoting an alliance with China over various national, regional and international issues. Taiwan has a dynamic capitalist economy with gradually decreasing guidance of investment and foreign trade by the authorities. In keeping with this trend, some large, state-owned banks and

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industrial firms have been privatized. Exports have provided the primary impetus for industrialization. The island runs a large trade surplus, and its foreign reserves are among the world’s largest. Despite restrictions on cross-strait links, China has overtaken the US to become Taiwan’s largest export market and its second-largest source of imports after Japan. China is also the island’s number one destination for foreign direct investment (FDI). Strong trade performance in 2007 pushed Taiwan’s GDP growth rate above 5%, and its unemployment rate of below 4% (CIA, 2008). As a result of the aforementioned clarity in the country’s political, social and economical outlooks, it can safely be concluded that the whole country, and in particular the capital, will attract flocks of famous Chinese (mainland China), regional, and multinational businesses and that the country will be witnessing a tremendous spurt in growth for its hospitality sector to serve them. While Taiwan restricted trade and travel with the mainland China for over half decade (since 1949), the new government (led by President Ma Ying-jeou) has helped open doors to warmer ties since 2007. ‘In a sign of rapprochement, the two sides held their first direct talks in June 2008 and signed agreements to launch the flights and triple the number of mainland people allowed to visit the island to 3,000 daily’ (Zhigang, 2008). For Yao Ta-kuang, the Chairman of Taiwan Association of Travel Agents, the implications of such tourism agreement are two-fold: financial and non-financial benefits. Overall, some 3,000 mainland visitors arriving daily will not only bring in US $1.97 billion annually, but also the revenue will benefit half a million people in all service-related sectors [hospitality sector] on the island and 2 million people, if their family members are included (Zhigang, 2008). As the hospitality sector contributes to the current administration’s push for stronger economic and cultural links with regional and other developing and developed countries, as well as China’s current push of using pandas2 (to advance its unification agenda with Taiwan), it is therefore, imperative that, first, the government gives enough impetus to the sector through well thought-out planning to increase the country’s economic interdependence with others, and finally, the hospitality sector which evolves in tune with the optimistic country’s economic outlook and government’s support, and partnership, to build a competent and talent pool of operational and supervisory levels workforce for the sector. Given the characteristics of a non-Western institutional context, Taiwan is a very interesting country to explore how the dynamics of social, cultural, political and economical factors and flexible working arrangements in the hospitality sector play out. Research methodology

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In order to get insights and feedback about the dynamics of labour flexibility practices from the three parties involved in the supply chain relationship between hotels and their partner agencies, a two-stage qualitative research approach to data collection was adopted: (i) focus group interview and (ii) in-depth interviews with individual participants. As a qualitative research methodology (mainly because of its reliance upon words spoken by participants), the focus group technique is effectively a group interview or focused discussion where a moderator leads a group of participants through a set of questions on a particular topic (see Denzin & Lincoln, 1994; Creswell, 1998). It encourages not only an exchange of opinions and thoughts, but also the production of new ideas mainly due to the public sharing and assessment of the ideas of others (Clark, Riley, Wilkie, & Wood, 1998). For Blumer (1969), a small group of experts gathered for discussion on a topic within their expertise is often more informative than a randomly selected or a representative sample. Despite the strengths of focus group interview as an effective stand-alone method or even an alternative to traditional survey methods (see Knap & Propst, 2006), it has several limitations, inter alia, participants can sway each other’s opinions which in turn results in as, Janis and Mann (1977) put it, ‘group think’; the possibility that some participants are unwilling to reveal their experiences in front of other participants; the fact that many participants are reluctant to disclose embarrassing or sensitive information about themselves or others (Walston & Lissitz, 2000, p. 459); the reluctance of those participants that they believe their comments are being evaluated or are in conflict with others in the group (Stage & Manning, 2003, p. 55-6); and more importantly, the researcher/facilitator bias. To overcome such problems which clearly undermine the validity and reliability of the findings (USAID, 1996, p. 1), further in-depth individual interviews with some of participants of the focus groups were conducted. Using these two different but complementary qualitative data collection techniques, the data then were collected from three types of key informants which developed the three sides of the triangle : (i) hotel managers, (ii) dispatch agency managers, and (iii) flexible/agency workers. To gather qualitative data from the key informants, the Directory of Tourism Bureau of Taiwan (affiliated to the government) as well as the Taipei Hotels and Resorts Directory were used. The cross-checking of data from these two and other similar sources revealed that the data were correct, reliable, and updated. As a result of our confidence in the overall content of the directories, and generalizability consideration of the research findings, we selected all 3 to 5 star hotels located in Taipei (n = 138) – the capital of Taiwan and its political, cultural, and economic centre – and compared them based on several criteria, namely, number of employees, HR recruitment strategy, formal relationship with the dispatch agencies, and more importantly ownership and extensive use of flexible workers. Our focus

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on Taipei hotels as our real site for data collection was based on several facts, namely, Taipei is a major commercial hub in the south-east Asia; it is regarded as a major industrial city which is home to many industries such as textile, electronics, and shipbuilding; it benefits from an extensive and well-developed infrastructure; it has a very low risk business environment for investment (sixth in the world) and therefore is home to the headquarters of many international companies (including international hotel chains), thereby a reasonable choice for multinational companies seeking presence in the Asia Pacific region – to name but a few. As a result of the aforementioned peculiarities of Taipei, the hospitality sector in the city has experienced the sharpest increase in occupancy rate of the hotels across Taiwan, thereby the need to more workforce to provide both back and front office operations activities for the hotels. As a result of the comparison of the initial 138 hotels, we chose 13 hotels and their partner agencies based on the following criteria: •

Local hotels (both independent or hotel chains);



Taiwanese-owned hotels (both independent or hotel chains);



Hotels with a formal extensive partnership with more than one dispatch agency;



Hotels with a long-established HRM department with a Vice-President HRM;



Hotels where a majority of their housekeeping workforce were supplied by dispatch agencies;



Well-established dispatch agencies with extensive experience with recruitment of various flexible workers for hospitality sector; and



Well-established dispatch agencies which serve the housekeeping departments of at least 2 hotels.

Our approach to the selection of sample hotels and their partner recruitment agencies for further analysis conformed to the research aims, in that the researchers wanted to analyze the culture/operations of Taiwanese-owned hotels with regard to the management’s quest for labour market flexibility and the resultant implications for the flexible workers, and finally the possibility of generalization and transferability of the findings, i.e., whether the findings were Taipei typical [or atypical] of the wider Taiwanese hotel labour market. The initial contact of these 13 hotels and their partner agencies was the hotel and agency general managers. We telephoned each manager and arranged a face-to-face meeting. As a consequence we had 13 face-to-face meetings with general and housekeeping managers of the hotels and 13 face-to-face meetings with their partner agency managers and the representative of the flexible workers who were recruited by the agencies. During the meeting the research aims and subsequent benefits for both the managers and the flexible workers were explained. After the meeting we

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decided to investigate only those cases where all three parties involved in the triangular supply chain relationship (i.e. hotel managers, agency managers, flexible workers) agreed to take part in the research. A week later, we received confirmation from only 4 hotels/agencies/flexible workers representatives where the three parties engaged confirmed their consent to fully support and take part in our study. In the remaining 9 hotels/agencies, one or more of the partners (sides of the triangle) were unable to take part in the study. For example, in three of the cases, where only two sides of the partnership (i.e. the agency managers and flexible workers) were happy to participate in the research project, the hotels seemed to undergo dramatic structural and managerial changes which in turn restricted their ability to attend the interviews. Overall, the 4 hotels and their partner agencies were representative of the wider hotel/agency population in terms of extensive use of flexible workers as the main linking pins between them. Tables 1, 2 and 3 present data on sample characteristics of the 4 hotels, their 4 key partner agencies and the flexible workers:

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Table 1. Characteristics of the four selected hotels Hotel 1 1986

Year founded Product type

Accommodation, conference & banqueting facilities

Number of employees Number of partner recruitment agencies Location

Hotel 2 1982

Hotel 3 1985

Accommodation, conference & banqueting facilities

Accommodation, conference & banqueting facilities

Hotel 4 1980 Accommodation, conference & banqueting facilities

149

137

155

170

2

3

2

3

Taipei

Taipei

Taipei

Taipei

Partnership with dispatch agencies (in years)

+9

+11

+12

+14

Long-established HRM department with VP HRM

Yes

Yes

Yes

Yes Taiwanese-owned

Ownership Number of participants in each focus group study (managers/supervisors) (4 focus group studies in total) Average age (years) of members of the focus group Education of members of the focus group: Diploma [college/university] Gender of members of the focus group: Female [Male] Number of participants in each in-depth individual interview (managers/supervisors) (19 interviews in total)

Taiwanese-owned

Taiwanese-owned

Taiwanese-owned

13

12

14

15

37.5

40

42.8

41.4

8% [92%]

8% [92%]

16% [84%]

5

24% [76%]

4

14% [86%] 14% [86%]

5

12

13%[87%] 26% [74%]

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Table 2. Characteristics of the four selected dispatch agencies Dispatch agency 1 1993

Year founded Product type

Professional employment solutions for temporary workers in hospitality sectors, health care etc.

Number of employees

175

Number of partner hotels

4

Partnership with hospitality sectors (in years) Ownership Number of participants in each focus group study (managers/supervisors) (4 focus group studies in total) Average age (years) of members of the focus group Education of members of the focus group: Diploma [college/university] Gender of members of the focus group: Female [Male] Number of participants in in-depth individual interview (managers/supervisors) (19 interviews in total)

Dispatch agency 2 1991 Professional employment solutions for temporary workers in hospitality sectors, health care etc

Dispatch agency 3 1994 Professional employment solutions for temporary workers in hospitality sectors, health care etc

Dispatch agency 4 1989 Professional employment solutions for temporary workers in hospitality sectors, health care etc

180

205

173

5

6

4

+13

+10

+13

Taiwanese-owned

Taiwanese-owned

Taiwanese-owned

13

14

15

11

43.4

39.6

40.5

38.3

+11

Taiwanese-owned

15%[85%]

21%[79%]

15%[85%]

7%[93%]

13%[87%]

18%[82%]

5

5

4

4

13

27%[73%]

27%[73%]

Table 3. Descriptive statistics on the (dispatch) agency workers in the housekeeping department of client hotels Hotel/agency 1 The percentage of agency workers in the housekeeping department of the hotel

65%

Average age (years)

43.7

Education: university/college [senior high school] below senior high school Gender (%): Female [Male]

0% [13%]87% 30[70]

Hotel/agency 2

Hotel/agency 3

Hotel/agency 4

68%

70%

76%

41.5

39.2

46

0% [12.5%]87.5%

0% [23.5%]76.5%

25[75]

35[65]

0% [13%]87% 20[80]

Number of years working for different dispatch agencies (average)

+16

+18

+15

+19

Number of participants in each focus group study (4 focus group studies in total)

15

16

17

15

5

6

5

4

Number of participants in each in-depth individual interview (20 interviews in total) Overall workers’ experience of agency employment

Inability to find a better job mainly due to a lack of expertise in other areas; lack of vocational or university qualifications.

Working for agency is regarded as the last resort for those without technical expertise in other professions.

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This is an easy option for making a minimal budget for living; anybody can do this job and you make nothing out of it; it just keeps you going.

As agency workers, we only do what we are asked to do; we try to fulfil the minimum requirements of the task; it is a meaningless job for us as we learn nothing from it.

As can be seen from Tables 1, 2 and 3, 12 focus group studies were consulted in this study as follows: one focus group study per hotel manager (4 hotels x 1 focus group study per hotel = 4) and one focus group study per dispatch agency manager (4 dispatch agencies x 1 focus group study per dispatch agency = 4), and one focus group study per workers of each dispatch agency employed by each hotel (workers of 4 dispatch agencies employed by each hotel x 1 focus group study = 4). Such selection of the research participants conforms to triangulation in that credibility and validity of the data is verified using multiple perspectives to interpret a single set of information. In order to have both natural features of conversation as well as focused discussion, the focus group allows members to think deeply and consider alternatives, and therefore allows for synergy to occur. To make most of the focus group advantages, the interview guide was then prepared carefully to invite openness and avoid bias (see Morgan & Krueger, 1998). As Tables 1, 2 and 3 indicate, the number of participants in each focus group session ranged from 11 to 17 people. Each session took approximately two hours and a half and all discussions and conversations were audio-taped with the consent of the participants and subsequently transcribed. During all focus group sessions a research assistant, who was familiar with the relevant literature and had been involved in numerous HRM research, was appointed to operate the audio-taping system and to write field notes. This in turn allowed the principal investigators to guide the interviewees’ discussions and responses to various open-ended questions. In order to deeply explore the focus group participants’ points of view, feelings and perspectives and therefore yield further information about flexibility practices and its consequences for the three parties involved, 58 in-depth individual interviews with both hotel/agency managers and agency workers were conducted to provide a more involving experience. The selection of interviewees was based on nonprobabilistic judgment sampling in that only those managers and agency workers who had extensive work experience with flexible working arrangements were interviewed. Furthermore, the number of in-depth interviews was consistent with previous qualitative research in that the researchers continued to interview the participants until no new information or themes were observed in the data (i.e. referred to as the concept of saturation, see Guest, Bunce, & Johnson, 2006; Graves, 2002; Kuzel, 1992). Specifically, our sample of in-depth individual interviews was representative of the research subjects (both hotel and dispatch agency managers and agency workers) in terms of extensive work experience, familiarity with contingent working arrangements, gender, age, employment status, and education (see Tables1, 2 and 3). In a manner similar to focus group interviewing and to increase accuracy of the data, the in-depth interviews were audio-taped. Non-verbal behaviours of the participants were also recorded as they 15

occurred during the interview sessions. The adopted research method not only resulted in the systematic recording and documenting of responses but also provided the researchers with intense probing for deeper meaning and understanding of the responses. Finally, in order to determine the meanings in the information gathered in relation to the purpose of the study, each interview transcript was (open) coded by two research assistants who had extensive qualitative research skills and familiarity with the research project topic. In order to enhance the reliability among the two research assistants –i.e. the coders – the coded texts were carefully checked by a third research assistant and any differences were subsequently resolved. In order to reassemble the data that were fractured during open coding, open codes were linked to each other to form axial codes (see Strauss & Corbin, 1994). The axial codes were then connected to form the following categories: 1. The fundamental managerial rationale behind contingent work arrangements 1.1 Readily accessible workforce (availability) 1.2 Low cost labour advantage 1.3 Quality labour

2. Flexible workers’ perceptions of contingent work arrangements 2.1 Readily accessible workforce (availability) 2.2 A Taylorist type of flexibility involving restraint, control and punishment 2.3 Limited flexibility 2.4 Inferior occupational status

Analysing the main and sub-categories of the aforementioned interviewees’ responses (also shown in Table 4) yielded some common and several contrasting views on flexible working arrangements. In respect of the commonality of the views, it appeared that the three sides of the triangle placed a heavy focus on ‘readily accessible workforce’ as a key ingredient and rationale for adopting labour flexibility practices. Furthermore, hotel and agency managers seemed to be reluctant to place themselves on different ends of the labour flexibility spectrum and therefore both managers were similar in their rationale for and importance placed on labour flexibility practices –i.e. ‘Low cost labour advantage’ and ‘quality labour’. In contrast, the flexible workers varied from managers in the

importance they placed on the impact or implication of flexibility in that they highlighted ‘restraint and control’, ‘limited flexibility’, and ‘inferior occupational status’ as the bottom line impact of flexibility arrangements between hotel and their partner dispatch agencies. For the purpose of comparison and illustration, the main and sub-categories of the interviewees’ responses are listed schematically in Table 4: 16

Table 4. Main and sub-categories of the interviewees’ responses to the reality of flexible working practices Respondents Category Hotel managers Flexible workers Readily accessible workforce • • Low cost labour advantage • Quality labour • Restraint & control • Limited flexibility • Inferior occupational status •

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Dispatch agency managers • • •

Further qualitative examination of each of these categories is presented below. The rationale for the growing quest for flexibility A readily accessible workforce at any time during the year was seen to be at the core of the supply chain relationship between labour dispatch agencies and their client hotels. According to the dispatch agency managers, flexibility of the agency workers in particular, in terms of time and to a lesser extent their skill, was even more demanding for their client hotels than other categories in service industries. While the hospitality market was a somewhat different market to that in other service sector categories in Taiwan, and contingent work practices appeared to be new to the hotel sector, due to the dynamic and export-driven nature of the economy, labour market demands have been changing radically, followed by an increase in the demand for flexible workers. As a result of the open-door policy in both China and more recently in Taiwan, most of the more labour-intensive industries have moved their manufacturing operations to neighbouring countries such as China and Malaysia. Such a tendency on the part of manufacturing firms in Taiwan was reinforced by a recent Taiwan government’s attempt to lift restriction on investment in China. For both hotel and dispatch agency managers this not only provoked the development of the labour dispatch industry but also inclined hotels to benefit from the available workforce. ‘We have been facing a sharp increase in our customers, both domestic and in particular international visitors. At the same time, the government has put into place a range of mechanisms to market our country’s potentials to attract more visitors to the country. While this is a good news for the hospitality business, it requires our efforts to appropriately cope with such huge increase in our customers in terms of providing meal, accommodation and recreational activities.’ [Hotel Manager] ‘We always have shortage of employees when it comes to summer period. While this was not a serious problem for our sector 10 year ago, it is now a dilemma mainly due to the growth of the economy in recent years and therefore the need for more workforce. Basically, it is not easy to

18

extend working hours of the employees nor to change the status of part-time to full-time employees. In order to overcome such workforce shortage, one main option is to contract with the labour dispatch agencies to provide us their workforce on a contingent basis.’ [Hotel Manager] ‘I am very conscious of the fact that in the coming years we will need more contingent work arrangements to help keep our economy growing. This is mainly due to some sort of labour mobility from manufacturing to more service-oriented sectors such as hospitality. This in turn has motivated us to get such people together and form a workforce who can do routine low-skilled jobs in various service organizations.’ [Dispatch Agency Manager] ‘I used to work for a 4-star hotel. I was responsible for HR department. Due to the seasonality and demand fluctuations of our sector we did have serious problems during peak-times in particular summer vocation with regard to recruiting temporary or even shift workers to respond to the increased demand. I then got the idea to set up my own dispatch agency company. Specifically, my decision to have my own business has been a function of the current Mainland (Chinese) tourists who have boosted our tourist industry.’ [Dispatch Agency Manager]

In addition to the availability of the flexible workers, low cost labour advantage was also seen to be central to the adoption of contingent work arrangements. Our observations of some of the employment contracts showed that flexible workers were drawing lower salaries than their full-time counterparts. In one manager’s words, ‘These people [flexible workers] work as hard as our full-time staff. If they were full-time, they would get paid twice as much.’ [Hotel Manager]

In the interests of cost-effective operations, the number of full-time employees in the four hotels was slightly seen to be decreased. One primary reason for such apparent redundancy was mentioned to be more use of cheap but flexible agency workers. Interestingly, we found that most of the dispatch

19

agency workers had work experience in the hospitality sector and that a large number of them used to work for the hospitality sector on a full-time basis. In one agency manager’s words, ‘We help the downsized workers of hospitality sector to get back to their original jobs but at a lot more cheaper rate.’ [Dispatch Agency Manager]

Another dispatch agency manager stated that: ‘I have observed a trend in workforce employment in the hospitality sector. There is a tendency on the part of hotel managers to replace full-time workers with our [agency] flexible workers. I can say for sure that the logic behind this is more related to lower operational costs which are fulfilled through our [agency] cheap labour.’ [Dispatch Agency Manager]

For the hotel managers, the cost of full-time employment was substantial, and the labour dispatch agencies were viewed as a major source of cost-saving for them. Despite the boom of Taiwan’s economy over the last several years and current boom in the hospitality sector (driven mainly by the recent agreement between Taiwan and China) the form of working arrangements considered appropriate and profitable for the hotels depended upon the cost of labour. In doing so, both hotels and dispatch agencies were seeking opportunities to take advantage of cheap flexible labour. The benefit of such workforce to the hotels or dispatch agencies, as explained by one dispatch agency manager, is clear: ‘We get the same and even more motivated workforce. However, this achieves at a very low cost not

least

because

such

workers

have

lower

expectations

than

their

full-time

counterparts.’[Dispatch Agency Manager]

Similarly, a hotel manager commented: ‘Agency workers are regarded as low-wage labour. They are very hard-working and tend to make less complaint than their full-time counterparts.’ [Hotel Manager]

Or, as one dispatch agency manager summarized: 20

‘The primary reason for the employment of flexible workers is that they are a safe source of competitive advantage. Indeed, when our client hotels or other clients in other industries approach us for our workforce, lower cost would always remain their main concern and first priority to take or reject our offer.’ [Dispatch Agency Manager]

Surprisingly, the least likely reason for the preference of agency workers compared to full-time workforce was their level of competence and quality. For most of the managers, it was very difficult to compete on quality alone. Hotels were seen to differentiate themselves from other competitors through offering lower cost accommodation such as lower room rate per night or providing guests with fitness resources, swimming pools, typical Taiwanese songs and dances during dining in the restaurants. While the provision of these services depended very much upon a quality workforce, it was apparent that hotels saved money by paying low wages to agency workers in order to finance a range of facilities for their guests. ‘We know that quality is a vital aspect of our service delivery. But most of our competitors in the industry have been able to dominate the market by offering low cost accommodation.’[Hotel Manager] ‘In the hospitality sector, it is not uncommon to achieve a competitive advantage by low cost operations. In most cases, they achieve this by saving in their labour costs. In doing so, it is not easy to cut full-time workers pay. However, our agency flexible workers have been the focus and the main target in recent years for cutting down the labour cost across the sector.’ [Hotel Manager] ‘We have been in operations for over a decade and have offered a range of contingent work arrangements to various clients across different sectors. There has been a sharp increase in the demand for our services since 2000. We have almost shifted our focus from [shopfloor] flexible workers in manufacturing sector to hospitality industry. In fact, what they all ask when they seek our services is how much it will cost them. We seldom get query about how qualified and competent our workforce is.’ [Dispatch Agency Manager] ‘For the hospitality sector, low labour costs matter most than the quality, competence and skills of the workforce. This implies that we all look for cheaper but available labour with the very basic requirements to fit the job when needed. In reality, quality does not count much or even not at all simply because we recruit anybody from the dispatch agencies who is available to work on a contingent basis but at reduced rate than their full-time counterparts.’ [Hotel Manager]

21

Reviewing the managers’ responses across both hotels and labour dispatch agencies indicated that better service delivery and therefore improved customer satisfaction can be achieved through cutting labour costs. Such a narrow view to quality is, however, against the ‘outside-in’ philosophy of quality, in that improved customer satisfaction can only be achieved through continuous improvement of the whole operations (see Deming, 1986). Clearly, the advantage gained through labour cost savings (as opposed to non-labour savings) was often short-lived not least because (to quote Gamble, 2006, p. 1471) ‘rivals rapidly copied and adopted these features’ (see also Audit Commission, 2001; Booth et al., 2002; Guest, 2004). Dispatch agency worker’s perceptions of flexible working In contrast to the aforementioned managerial interests in flexible working arrangements, dispatch agency workers viewed flexibility arrangements and its associated practices as a means of tightening managerial control over the flexible workforce. Whilst a majority of these workers were low- or unskilled, there was no opportunity for them to enhance their working skills or (to quote Pollert, 1991) to become ‘skill-flexible-workers’. Instead, both hotel and dispatch agency managers provided an environment in which the majority of workers considered that they were under tight managerial control. When asked what did they mean by managerial control, a dispatch agency worker remarked: ‘Although I am a flexible worker, I am unable to take any control of my time. It is always the case that we have to work on certain days and times of the week. In fact, we have very limited work-time flexibility.’ [Dispatch Agency Worker]

Another dispatch agency worker commented: ‘We do not have the freedom to decide how many hours to work or when to be off on holiday. What we do have, however, is some limited options in that we need to match our availability with the management’s requirements.’ [Dispatch Agency Worker]

The research evidence indicted that the dispatch agency workers were undertaking routine jobs or at most, a wide range of tasks at the same broad skill level. When asked whether they had improved their skills as a result of their employment with dispatch agencies, a majority of 93% confirmed the existence of a numerical flexibility (as opposed to functional flexibility) in that there was only a horizontal expansion of the agency jobs and that they were only involved in a range of tasks but at the same level of skill and responsibility. For dispatch agency workers, such job enlargement could not be considered as multi-tasking work; rather it only aimed to save the hotels money and man hours that normally would be paid to full-time workers. 22

‘I always do the same job, very basic and routine tasks that anybody can do. You do not have to know anything about hospitality or hotel operations. At the end of the day, you would see no difference in your working skills.’[Dispatch Agency Worker] ‘We have to do what we are asked to do. In fact, we have not got a second option. I am getting bored with doing the same task every day. I am worrying that if I get fired or have to leave my job one day what else I could do to pay for my living costs.’ [Dispatch Agency Worker] ‘They [our managers] really think that they pay us for nothing and we get free money. This means that we do not do a meaningful job and we make no contribution. I understand that there are limited opportunities for us in terms of promotion, training and pay rise. But our managers do nothing to make our jobs less boring. Cost-saving operations matter most to them than improving our skills.’ [Dispatch Agency Worker]

For most of the dispatch agency workers there was nothing new in flexible working arrangements and that it only resulted in management’s absolute control over the (agency) workers. They classified themselves as the most vulnerable workers, who could be replaceable easily or who were faced with reduced pay in case they failed to perform to their maximum potential. As a result of cost-driven and control-oriented management’s rationale, dispatch agency workers not only failed to develop themselves, but also were unable to learn new skills or multi-task jobs. The implication of such increased management control over the workforce was that most of the workers talked about the absence of a culture of trust in their workplaces. While, Hosmer’s (1995) review of the organizational trust literature suggests that trust should lead to greater cooperation among organizational stakeholders, its absence in the context of our research organisations seemed to result in workplace cynicism, followed by a culture of blame. ‘Our managers think that we do not do our best. While we work hard we get less and work for long hours to make more money. We need to be flexible to the managers’ needs in terms when and how to work and what to do. I jus feel that they only look for their own benefits.’ [Dispatch Agency Worker] ‘There is a culture of fear. We might easily get fired as there is available workforce in the labour market who can do our job. What we all do is to avoid mistakes or even to hide mistakes where possible to avoid any subsequent punishment and dismissal.’ [Dispatch Agency Worker] ‘Managers refuse to listen to our voices. Whatever we say they will disprove it. As a result, we all are jaded and uninterested in the work. But we have to carry on as there is no other option. I think that the dispatch agencies have made it easier for their clients to exploit us. I am really pessimistic about all management’s actions and intentions.’ [Dispatch Agency Worker]

23

‘I am suspicious of the motives of both dispatch agency and hotel managers. They only follow their own interests. They even prefer their own interests to those of organisational ones.’ [Dispatch Agency Worker]

In addition to tight managerial control, the occupational status of the agency workers was seen to be inferior to that of their full-time hotel counterparts. This links in part to the fact that they are recruited and paid by their own dispatch agencies, rather than the hotels. ‘The cheaper you are the better chance you have to get the job’, was one of most frequently cited responses by agency workers. While they worked for the hotels, their employment terms and conditions were left with the dispatch agencies. The temporary and insecure nature of relationship between the workers and the agencies left a majority of the workers to work hard and for long hours but at lower pay. ‘I have been working for this hotel for nearly one and a half years. But I still do not feel that I am belonged to here. When it comes to promotion, pay rise or even attending weekly staff meetings we have no voice. Whilst we work with the full-time housekeeping staff and do the same job, we are paid less and being treated in a rather stigmatized manner.’ [Dispatch Agency Worker] ‘When a full-time staff makes a complaint about us for any reason, we will be highly likely fired or have to work at a reduced pay rate to avoid dismissal.’ [Dispatch Agency Worker]

Despite hard work and delivering high quality service to hotels, the dispatch agency workers felt very insecure, in that whey could be fired at any time. While full-time employees of the hotels could flag their training needs or any other requirements to the hotels, dispatch agency workers seemed to have no role in, for example, deciding whether they needed any training or personal development. In fact, the increasing attention paid to the importance of full-time workers of the hotels showed that, dispatch agency workers were disadvantaged in terms of the very basic employee rights. Clearly, the current managerial interests of hotels and dispatch agencies in flexible workers and the reality of flexible workers’ inferior pay or lack of career development and economic insecurity are in contrast to one of the principal dictums of managing human resources: to value and develop employees as an organization’s key resource (see Geary, 1992, p. 276; Keep, 1989). ‘After nearly a year I have not received any training. I know we do the basic and very routine jobs. But I strongly believe that I need to be trained to be able to provide a good service. It is interesting to see that the hotel provides training to the full-time staff who do the same job as we do.’ [Dispatch Agency Worker] ‘I am not in a position to negotiate my salary. Whatever they decide we should be happy with. With the exception of our basic salary, we seldom ask for any other benefits. If they do not need our services, we have to leave with no complaint.’ [Dispatch Agency Worker]

24

‘Because of our poor and insecure working status, we should abide what they [managers and full-time staff] say. This means that we only have to think about doing low-paid routine jobs.’[Dispatch Agency Worker] ‘I recall that I worked for only a month for other agency last year. I then had to leave as there was no work to do. Later on, I was asked to do a similar job for another three months.’ [Dispatch Agency Worker]

As the above quotations show, the dispatch agency workers were seen to be reluctant or even de-motivated to raise their voice concerning the growing divide between their employment status and that of their full-time counterparts. As a result, Hyman (1991), Beck (2000) and Geary (1992), among others, argue that contingent work arrangements ought to be viewed with scepticism because there is nothing new in it for them, and that it is not necessarily the win-win game portrayed in the perspective literature (see Atkinson & Meager, 1986; Harrison & Kelley , 1993; Kalleberg, 2001; Forde, 2001; Forde & Slater, 2006). Conclusions The purpose of this study was to analyze the nature and extent of labour flexibility practices in a non-Western context with a particular focus on the hospitality sector in Taiwan. In doing so, four labour dispatch agencies, their flexible workers, and four of their client hotels in the hospitality sector were investigated through a two-phase qualitative research: focus group and in-depth individual interview. The data gathered indicate several similar to and some different conclusions from those results earlier found in the context of developed economies. In terms of similarity, labour flexibility practices appeared to provide much minimal opportunities for flexible workers and offered more opportunities for both the dispatch agencies and their client hotels. Dispatch agency workers appeared to be disadvantaged in terms of, among others, training, promotion, and remuneration. Indeed, flexible working practices were seen to have a limited (with the exception of limited working arrangements) impact on the flexible worker welfare. More importantly, flexibility practices were seen to be a means of tightening managerial control over the workforce. In consequence, as our evidence indicated, job insecurity of the agency workers was frequently cited not to be uncommon in the triangular relationship among dispatch agencies, hotels and the flexible workers, an indication of the fact that flexible labour can be purchased on an ‘as needed’ or ‘just-in time’ basis. However, management’s focus on flexible working arrangements was a matter of, as Goold and Campbell (1987) put it, ‘a financial control’, an indication of management’s treatment of flexible workers as a ‘cost’ and their unwillingness and inability to 25

invest in flexible workers as human capital (see Storey & Sisson, 1993). These findings have close affinity with Handy’s (1989) model of the shamrock organization in that dispatch agency workers represent the third leaf of the shamrock: they are employed just to do non-essential work and to meet peaks and valleys in demand. In a manner similar to research findings of temporary agency work in developed economies (e.g. Storey, 1989; Geary, 1992; Forde and Slater, 2003, 2006; DTI, 1998; EC, 2002; ESRC, 2000), the position of agency workers as an important side of 3-way partnership or triangular relationship involving hotels, agencies, and temporary workers was rather unclear – leaving the flexible workers unsatisfied, uncommitted and insecure. As a result of such poor management of the triangular relationship, it can be argued that low organizational commitment and loyalty and job dissatisfaction will continue to remain and that flexible workers perceive their agency work as the last resort in the absence of any other job opportunity (see Drucker and Stanworth, 2004). Despite such a gloomy picture of workers’ experiences of work, considerable care needs to be taken in evaluating and interpreting of the findings. As mentioned earlier (see The Taiwan Context), the Taiwanese economy has been growing at its fastest pace since 2004 (approximately 5.6% pa) and this trend is expected to continue as an optimistic forecast for the country. The new government has also been in the process of building a much wider, deeper and robust relationship with China and the rest of the world – an indication of an on-going positive dynamics among various sectors of the country’s economy. Clearly, the hospitality sector can function as the common denominator for most of current government plans, in particular, with regard to close tie with mainland China. Moreover, the dispatch agency working is a new concept in the Taiwanese literature on human resource management (HRM). Provided that the current economy growth rate is maintained, a more balanced triangular relationship is expected among the sides of the relationship as this is the only way which the three parties can positively contribute to the well-being of hospitality sector community as well as the country’s and regional economies. With respect to differences, the recruitment of agency workers did not seem to impact on higher full-time labour turnover as some of the previous literature suggested (e.g. Geary, 1992; Forde, 2001). Despite workers’ concern about their job insecurity, there was also less convincing evidence of higher turnover of flexible workers (see Lai et al., 2008). These findings contradict the assumptions made by the flexible firm model (Atkinson, 1984, 1985) and other relevant literature to contingent work practices (see Korpi & Levin, 2001; Voudouris, 2004; Soltani et al., 2008; Soltani and Wilkinson, forthcoming) that flexibility practices result in higher labour turnover. As a result of a managerial short-lived approach to the recruitment of flexible workers, flexible workers appeared to become very jaded in their perceptions of the reality of management’s intent towards 26

flexibility practices. Such workers’ perception of management’s attitudes and approach has close affinity with the notion of ‘organizational cynicism’ in that the cost-effective and tight control mechanism adopted by management prevented employees from wholeheartedly participating in any of various organisational activities and processes. Specifically, agency workers tended to be suspicious of not only management intent but also the motives of their full-time counterparts. The implication of such findings and agency workers’ perception for Geary (1992) is a continued tension between temporary and full-time staff, leading to the fear of, as he called it, ‘victimisation’. Forde (2001) takes the argument further and points out that the fear of victimisation can also stem from the agency if the worker comes to be viewed as a troublemaker or unreliable, thereby resulting in the workers-to-be being passed-over for, or refused, future assignments (cited in Forde & Slater, 2006, p. 154). The primary limitation of this study relates to its methodological approach in that it has been a qualitative study and it could have included other research methods complementary to the focus group and in-depth individual interviews. Although utmost care has been taken to capture the richness and depth of interviewees’ responses and their meanings, that every approach has its own advantage and disadvantage, and the fact that there is no universally superior methodology, it is argued that a certain level of synergy between both qualitative and quantitative research approaches could provide a holistic view of the research phenomenon (see Boyer and Swink 2008; Bryman, 2006). Whilst data was collected from multiple perspectives and the necessary saturation (see Guest et al., 2006; Graves, 2002) of research themes for qualitative research was achieved, the small sample size (only four hotels and four recruitment agencies) restricts the generalizability and transferability of the findings to the wider population of Taiwan hotels and their partner recruitment agencies. As a result of such a research limitation, a more comprehensive and countrywide research into the current state of labour flexibility and its associated practices is recommended in the hospitality industry (and other economic sectors) in order to analyze the dynamics of triangular (three-way) relationship among hospitality sector, dispatch agencies and flexible workers. Although the adoption of flexibility practices is relatively new in the context of Taiwan and most of the developing economies, one could argue that the current trend in the application of flexibility practices across the hospitality sector in Taiwan forms a transient phase. However, as our evidence indicates, management of contingent work arrangements (both dispatch agencies and hotels) seemed to act unilaterally, in that agency workers were not allowed to raise their voice or even negotiate their working status. In other words, there exits scepticism about the rhetoric of the triangular relationship among the three parties not least because of the emergence of a bilateral partnership between hotel and agency managers, in that the flexible workers are no longer part of the relationship, and that their existence is very much dependent on the needs of both agencies and 27

their clients. Indeed, it can be argued that a weak flexible workforce seems to remain a primary objective of both agencies and their clients. While the current managerial approach to flexibility practices and the nature of the triangular relationship among dispatch agency, hotels and flexible workers differ relatively from those found in Western contexts, it is argued that a more transparent and regulated flexible labour market recognised by the government could play an important role in protecting flexible workers from any unfair treatment. Failing to do so, flexible workers would remain the society’s most vulnerable work group (see Forde, 2001; Geary, 1992). Implicit in the aforementioned findings are several points which deserve further attention by practicing managers. The implication of the findings for dispatch agencies and their clients (or other organisations utilising agency labour) is that it is in their mutual interest to develop and maintain well-structured employee relations policies in which the flexible worker’s rights are clearly defined and protected and more importantly, both agency and their clients are fully committed to a similar equal opportunity policy for all the workforce despite their working status (see Ward et al., 2001). In addition, there is a very strong need on the part of the managers of both agencies and their clients to enhance awareness of their temporary workers of their working rights. In the absence of such HRM-related procedures and a lack of recognition of the triangular relationship (as opposed to mutual interests of only agencies and their clients), as Drucker and Stanworth (2004) and Forde and Slater (2006) have pointed out, it is not uncommon for the managers to expect workers to exhibit no loyalty, commitment and motivation. Clearly, these managerial implications and their achievement pose a crucial challenge for the government of Taiwan in that the government should play the linking-pin role among the community of hospitality sector (both employers and workers) in strengthening the triangular partnership and ensuring its sustainability through mandatory effective employer-employee relations policies.

Notes 1. Council for Economic Planning and Development (CEPD) in Taiwan (2004). 2. The two pandas were given to Taiwan by Chinese president Hu Jintao to improve ties between the two sides, split since the end of the Chinese Civil War in 1949. They arrived in a chartered plane on November 23 and - after quarantine - made their debut at the Taipei Zoo on January 26. Since then, an average of 12,500 people has visited the Panda House to 28

see the velvety animals per day, making them the star animals of the zoo. Yet the pandas do carry political symbolism as China named them Tuan Tuan and Yuan Yuan (Tuanyuan means reunion in Chinese) to symbolize that Taiwan and China should reunify (Source: "A million Taiwanese have seen Chinese pandas at Taipei Zoo - Monsters and Critics" http://www.monstersandcritics.com/news/asiapacific/news/article_ 471325 .php/A_ illion_ Taiwanese_ have_seen_Chinese_pandas_at_Taipei_Zoo_#ixzz0DnicpgSD&A).

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