The Employment Relationship in the UK Public Sector - Dissertation Example

Introduction 1 ment of the problem With the emergence of new technologies and the growth of the service economy, companies have been rethinking on how to do business (Camerman, Cropanzano, & Vandenberghe, 2007). In the process businesses have developed the ability to respond to the fast-changing business environments. One of the ways they have responded is to renegotiate the employment contract. Temporary workers are employed through different sources and in different forms. Since temporary workers occupy an increasingly important place in organizations, this is an important strategic issue for HRM. Temporary employment is becoming common in Europe and the UK also but its impact on firm performance and productivity has not been studied extensively, state Camerman, Cropanzano, and Vandenberghe. The cost to a company does not merely include the wages and the employee benefits. It should also include the recruitment and selection costs, the costs of training and development, and more importantly the employee contribution towards organizational performance. While it is difficult to measure individual employee contribution towards organizational performance, employee commitment and motivation would, to some extent, impact productivity. The increased use of temporary workers by the public sector has given rise to concerns of employee commitment and consequently the indirect costs associated with temporary or fixed-term workers. 1.2 Rationale for research The public sector employers have a positive outlook on temporary workers, the motivation being that it gives them access to specific skill sets (Woods, 2010). Forty four percent of the public sector employers even site this as essential to the success of their organization. A flexible workforce is essential to allow the businesses to grow. The public sector needs a major transformation and this demands a team of talented professionals to manage change. Skills are required in diverse sectors such as project management, budgetary control, procurement, HR outsourcing and transformation. Flexible workforce appears to be the key to a successful organization. Labour market regulation affects labour productivity growth through its impact on worker motivation and effort. If the wages are below the fair wage perception of the workers, the efforts of employees would be reduced. The higher the wage, the higher will be the effort put in by the employees due to higher cost of job loss (Storm & Naastepad, 2007). A study of 20 OECD countries suggests that regulated labour markets promote long-run labour productivity growth both in case of temporary and full-time workers. Regulation raises worker commitment and motivation. Several public sector organizations such as Caerphilly County Borough Council, Cardiff Council, RCT, Torfaen and Merthyr Councils have been employing temporary workers. However, not much of research is available on employee motivation among temporary workers in public sector organizations. It is hence difficult to ascertain to what extent these employees provide competitive advantage. Hence, with the aim to ascertain the strategic decision that public sector organizations should take in staffing and human resources, the research questions for the study are: Are employee commitment and motivation among temporary workers directly related to productivity? To what extent employee motivation and commitment of directly employed temporary workers in public sector organizations differ against the permanent workers? Is it more economical to hire temporary workers against permanent employees taking into account the benefits that have to be given to permanent workers in such organizations? 1.3 Definition of terms Temporary workers Temporary workers are employees who are not permanently hired but hired just for limited periods of time (Entrepreneur Media, 2011). They work for a specific purpose for a specified period of time. Motivation Motivation according to Hardre (2003) is an internal process that controls and regulates behavior. It has been defined as a psychological force that initiates, directs, and sustains human behavior over time (Barnett, 1999). 1.4 Limitations of the study It is difficult to apprehend at this stage how much literature would be available on the subject as well as on the theories of motivation. It is also difficult to decide which particular theory would be used as the framework for the study. The number of participants in the study can also not be determined at this stage. While all efforts would be made to ensure honest data collection, at this stage it cannot be guaranteed. All efforts would be made to ensure reliability and validity of the data collected. Senior executives may be reluctant to share their strategy or their policy specially when they would find that temporary workers’ level of motivation is lower than that of the permanent workers. Responses could also be biased and the employees too may fear delivering honest opinions as they may not want to fall into disagreement with the management. 2. Literature review There has been a shift from the normal, standard, full-time employment, at the employer’s place of business and under employer’s supervision in the 20th century, towards alternative or non-standard arrangements in different parts of the world (Connelly & Gallagher, 2004). Workers are now hired on contingent or fixed-term contracts. Contingent work has been described as “any job in which an individual does not have an explicit or implicit contract for long-term employment or one in which the minimum hours worked can vary in a nonsystematic manner" (Polivka & Nardone, 1989 cited by Connelly & Gallagher). The authors describe four different categories of contingent workers. The first category includes temporary staffing agencies that contract out workers to other organizations. The second category includes the freelance workers or the temporary contractors also referred to as self-employed individuals. A Third category includes the short-term employees needed for contingent work and are hired directly by the organization. The fourth category includes workers that are directly hired by an organization on a seasonal contract and are also known as “temporaries”. This paper would use the term temporaries to indicate part-time workers hired by organizations. Coyle-Shapiro and Kessler (2003) investigated the relationship between psychological contract and two outcomes – organizational commitment and organizational citizenship behavior. This has gained importance because the public service organizations find a rise in demand for high quality services while the resources are limited. Positive employee attitude and behavior can help cope with the pressures on public service delivery. The authors reviewed previous studies and found that the motivation of the public and private sector employees differs. This study, conducted through a survey of 5709 employees, finds that the public sector employees reciprocate the treatment they receive from the employers. They used the psychological contract to understand the employment relationship where the central element is that employees must respond favorably to the favorable treatment from the employers. Their findings confirm that the norm of reciprocity underlies the development of an employee’s commitment to the organization. This suggests that if the public sector employers are unable to fulfill their obligations to staff, the employees would have no incentive or motivation to work. The employees may have the attitude to reciprocate through enhanced commitment but this does not suggest that it leads to intrinsic motivation. The authors have cited Perry (1997) who suggests that the public servants rate intrinsic rewards higher than the private sector employees do. The authors also suggest that the ability of the public sector employers to meet employee expectations are constrained but the cost of addressing employee expectations need not be high. This implies that economic downturn and engaging temporaries does not impact the motivation and productivity of the employees. The sample for the study included both part-time and full-time employees but the outcome has not been segregated. It is hence assumed that the responses from the part-time and the full-time workers were the same. This study hence suggests that regardless whether the employees are part-time or full-time, the output would depend on how employers can fulfill employee obligations. This study does not indicate whether these temporary workers were directly hired by the organization or were supplied by a third party. Coyle-Shapiro and Morrow (2006) studied another type of contingent employment relationship. They focused on the long-term contracted employees supplied by third parties who place employees with their client organizations. Such employees resemble temporary workers because they are merely working at the client organization on behalf of the third party supplier. Two categories of affective commitment were focused upon – how these employees regard their formal employer, namely the contractor, and how they perceive the client organization. Based on the social exchange theory, the findings of this study also support the findings of the psychological contract that employee productivity depends upon how well the employers fulfill the obligations. In this study, the contracted employees perceived the client organization as well as its formal employers with equal commitment. The employees could have developed affective commitment towards the client organization because of the long-term contractual agreement. The sample in this study comprised of private sector contracted employees working in public sector client organization. Biggs and Swailes (2006) investigated the level of organizational commitment in agency workers compared with permanent workers by taking into account the relations between the two groups. The study found that agency workers had significantly lower levels of organizational commitment compared with permanent workers once the relation between the agency and the permanent workers were controlled. These findings suggest that if a relationship of mutual trust can be developed between the agency workers and the permanent workers, it would lead to higher commitment and job satisfaction among the agency workers. The three studies have all focused on organizational commitment and none of the studies discuss on motivation of the temporary workers. They do however imply that organizational commitment enhances job satisfaction and productivity. If it is assumed that motivation can enhance commitment, then motivation is what should be studied among the temporary workers at the public sector organizations. Secondly, two of the studies reviewed above were conducted on agency temporary workers. The sample composition of the first study does not clearly indicate whether the temporary workers were directly hired by the organization or were agency workers. It would be hence of value to ascertain and compare with these studies whether there is any difference in the motivation between agency temporary workers and temporary workers directly hired by the organization. This could be an additional outcome of the study. 3. Research Methodology The purpose of the research, the subject and the timeframe help define the research process and the methodology. The process of research is methodical and a systematic system of inquiry (Amaratunga et al, 2002). A set pattern is followed in collecting, analyzing and interpreting information. This is because research is concerned with problems and attitudes, and relies of fact, experience and data. 3.1 Research phenomenon There has been a shift in employment patterns and organizations now look at alternative forms of employment such as temporary or contingent workers. This system has its own advantages as well as disadvantages. The purpose of this research is to determine whether the organizations are able to achieve the expected benefits in employing temporary workers. The phenomenon under study is hence the attitude of both the management and the temporary employees at the public sector organizations in the UK. Not much of research is available on the motivation level of the temporary workers directly hired by the organization. Most of the studies conducted on the issue of temporary workers have been based on the social exchange theory. 3.2 Deductive and inductive methods While there are many ways to conduct research, two common but fundamentally different and competing paradigms include logical positivism or phenomological interpretivism. In logical positivism hypotheses can be formulated in advance and is based on the quantitative and the experimental methods (Amaratunga et al). This requires independence of the observer from the subject being observed. The interpretive method, on the other hand, uses qualitative approaches to inductively understand experience based on the context in which it has been set. This approach does not accept the belief of the positivists that objects of experience are independent events. However, the method of research adopted should fulfill the purpose of the research, answer the research questions and achieve the objectives of the study. Each method has its own advantages and disadvantages and hence an informed decision should be taken after evaluation of the benefits and pitfalls. 3.3 Research approach A qualitative approach will be adopted for this study. A qualitative approach enables the researcher to have an insider perspective on social actions (Knox, 2004). Different scenarios may occur under different circumstances and this approach would enable to articulate the different scenarios while also enable studying the phenomenon on natural settings. 3.4 Research Strategy Through the qualitative method of inquiry, both primary and secondary data would be collected. This would bring out the deeper underlying context which is being studied. This approach helps explore new ideas effectively. 3.5 Data collection This study requires an insight into the motivation level of directly employed temporary workers at the public sector organizations. The strategy adopted needs to be evaluated against the results obtained. The outcome of the study would enable organizations in the future to base their decisions accordingly. The first question pertains to whether employee commitment and motivation among temporary workers is directly related to productivity. The answer to this question can be obtained through a review of the previous studies. Academic journals would be accessed to extract studies and their findings on the subject. Past research on the subject is available in plenty and hence only the most important and relevant data would be selected. This itself is the process of evaluation and prioritization. Data would be obtained from secondary sources which would help to corroborate with the findings of the primary data. Moreover, data from secondary sources help generate new understanding through the process of reflection (Feurer & Chaharbaghi, 1995). Primary data collection would be done as far as possible through face-to-face interviews or telephone interviews, and through surveys. Interviews reveal the subtle realities that underlie the process of decision-making. This can be overlooked by large-scale statistical analyses (Herod, 1993). Interview as a method of data collection offers flexibility of time, place as well as the questions, which can be reframed as the interview progresses. Interviews help to experience the meaning of what the respondent implies and hence more than merely being a data gathering technique, they are a social encounter where fresh knowledge is constructed (Eggenberger & Nelms, 2006). In-depth interviews reveal the social and personal matters that are not possible to obtain through telephonic interviews. Through face-to-face interviews the respondent’s emotions, beliefs, and the reasons for their actions can be ascertained. This is necessary to evaluate whether the temporary workers have enough motivation to work as the permanent workers. The interview questions would be open-ended so that they can be reframed and reformulated depending upon the responses. In-depth interviews would reveal the sponstaneous responses of the respondents. While efforts would be made to hold face-to-face interviews as far as possible, some interviews might have to be conducted over telephone depending upon time and budget. While interviews would be held of the managers and senior executives, focus-group interviews would be taken of the employees. Separate focus groups would be held of the permanent workers and the temporary workers. In a group employees tend to reveal their inner feelings which they may be reluctant to reveal in private. In a group, the temporary employees would be able to voice their grievances if any, which is difficult through surveys or through individual interviews. 3.6 Research design To determine the level of motivation multi-perspective view of the situation is necessary. Thus it would be essential to obtain the views of the management as well as the temporary workers. At the same time, in any organization, temporary workers work alongside with the permanent workers. It would also hence be essential to obtain information from the permanent workers and their level of motivation. Motivation, commitment and job satisfaction are inter-related. This would enable the researchers to draw a true picture of the situation and achieve the study objectives. Thus, firms that have both directly employed temporary workers and permanent staff on their rolls would be selected for the interview. Studies so far have focused on the difference in commitment among the agency workers and permanent workers. This study would hence involve direct temporary and permanent staff. Interviews would be conducted of the management at public sector organizations such as Caerphilly County Borough Council, Cardiff Council, RCT, Torfaen and Merthyr Councils. All these organizations have permanent employees as well as temporary employees that have been directly employed by the Councils. The interview questions would aim to determine if the management employs the same motivation techniques for the permanent as well as the temporary employees. The questions would also try to evaluate if the same conscious effort by the management yielded different results in productivity and performance in the case of permanent and temporary workers. The term motivation can be a general term and hence, the study would also evaluate if any of the motivation techniques were used as a guideline by the employers. Efforts would also be made to understand if the organizations assess individual motivation needs or the same methods are applicable to all. Here ‘individual’ pertains to individual permanent employees. The focus group interview would be taken of the temporary employees that have been in the organization for more than six months. It is only after a period of time that an employee would be able to understand his/her level of motivation, incentive and commitment towards the organization. It also takes and organization time to understand the needs of the individual employee. A comparison of the findings of the interviews and the focus group interview would help evaluate the discrepancies and assist the organizations in altering their HR strategy. 3.7 Data analysis Data analysis of the secondary data would be done on three steps – data reduction, data display and data interpretation. If the display is better qualitative analysis would be better. As far as the primary data is concerned, no statistical analysis would be done but the data from the interviews and the focus group interviews would be done alongside with the theories and literature available on the subject. 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