Flexible working and its impact on job quality

Changing Employment researcher Pedro Mendonca shares his research into flexible working and the impact it can have on skills development and overall employability.

Professor Paul Stewart wrote in his SBS blog post: “According to Eurostat estimates, nearly 24.5 million people in the EU's 28 member countries were unemployed in November 2014, corresponding to an overall unemployment rate of 10%. While jobless numbers have fallen below crisis peaks, recent employment growth is concentrated in the temporary or part-time labour markets, suggesting an increase in job insecurity”.

The employment trends based on temporary and part-time work that Professor Stewart refers to entails an increase of contractual flexibility in the workplace. This has been mostly driven by the deregulation of labour markets throughout Europe (OECD, 2013).

This contractual flexibility has increasingly entailed high levels of temporal flexibility such as the variation in the number of hours worked and the timing of the work. In the UK, Eurofound (2012) found that 30% of workers report experiencing changes in their work schedule.

The growth of flexible contractual and temporal arrangements [particularly zero-hour contracts] has been at the epicentre of public and policy debate lately, and has figured prominently in debates between academia, professional chartered bodies [such as CIPD], and politicians. The main arguments centre on whether flexible working arrangements are good or harmful for job quality, and the way it particularly impacts on workers’ work-life balance and well-being (Henly et al., 2006; CIPD, 2013).

Part of my research, conducted within the Scottish spirits industry, looks at flexible working arrangements from a slightly different angle and seeks to explore its wider implications for job quality.

Flexibility in the workplace

One workplace in which I carried out research was a bottling hall. Data analysis revealed that managers there achieved the needed flexibility by combining two main employment practices: different contractual arrangements and working time variations.

Almost 70% of the whole workforce had flexible contracts, which encompassed a number of practices that separate them from the “standard working arrangement”. These entailed:

• The company had regular labour matching reviews where flexible workers had their contracts changed to better match the market demands and keep labour costs low.
• The temporary contracts were very short in nature, spanning from 2 weeks to 4 months. The same individuals were encouraged to return every year to work for the company [almost an “ever-lasting” temporary relationship]. Illustrative of this was that the majority of interviewed temporary workers had more than 10 years of [broken] service with the company.
• The flexi-contracts entailed higher levels of job security. However, workers were provided with annualised hours, which meant that the amount of hours a worker would be provided with in one year was directly indexed to the company’s sales forecasts and labour needs. In addition, management was able to alter flexi-workers’ working hours on a daily basis in order to precisely adjust labour costs to production needs.

What is problematic in this is that the risk inherent to market fluctuations is transferred from the company to the individual - workers holding flexible working arrangements can be completely at the mercy of the market.

The problem of skill development

Flexible working arrangements can have implications for job quality in several ways: poor work-life balance, high levels of work intensity, pay inequality, and low levels of employee well-being.

In relation to skill development, the high levels of flexibility were found to reduce the scope for training and skill assimilation for both temporary and flexi-workers.

For instance, the “ever-lasting” temporary workers in the bottling hall would usually come back to perform the same job of the previous year, saving the company time and costs on training. However, as a result, temporary workers were experiencing a skill stagnation, which affected their employability in the labour market.

The same trend to reduce the length of training was found to affect flexi-workers. Although this group of workers were supposed to be enrolled in frequent training courses in order to be highly flexible and work across different shifts and machines, the training was highly constrained due to the system of annualised hours.

The strict management of annualised hours and the tight matching with the sales and production demands resulted in workers having little available time for enrolling in training courses. In practice, management accounted the annualised hours mostly as working hours, disregarding other needs such as training. As a result, when training occurred, flexi-workers were being rushed through the training process so they could go back to the lines as fast as possible.

Indeed, flexi-workers consistently reported that training was insufficient and inadequate. One core-flexi worker discussed that sometimes the training he was getting was “just a formality” to “tick the box for the bosses”.

Implications

The findings demonstrate that the flexible working arrangements were having a detrimental impact on workers skills’ development and overall employability in the labour market [specifically for the individuals with temporary contracts].

There was little evidence that training was used to develop real and transferable skills that would provide individuals a comprehensive understanding of the production process, which could be useful for other job opportunities and for the economy in general.

In terms of policy implications, this study suggests that the encouragement and promotion of flexible working arrangements may oppose the aspiration of creating an economy grounded on highly skilled workforce. Thus, for the workers concerned and economy in general, the growth of flexible working arrangements has significant negative implications.

About Pedro Mendonca

Pedro Mendonca is an early stage researcher in the Marie Curie 'Changing Employment' programme at the department of Human Resource Management at Strathclyde Business School.