Description
The importance of tourism and hospitality employment in both developed and developing countries is attested to by the World Travel and Tourism Council (WTTC), who suggest that travel- and tourism-related activities account for over 230 million jobs, or 8.7 per cent of jobs worldwide (WTTC, 2006).
HUMAN RESOURCE
MANAGEMENT FOR THE
HOSPITALITY AND
TOURISM INDUSTRIES
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HUMAN
RESOURCE
MANAGEMENT
FOR THE
HOSPITALITY
AND TOURISM
INDUSTRIES
Dennis Nickson
Deputy Head of Department, Department of Human Resource
Management, Strathclyde Business School, University
of Strathclyde, Glasgow, Scotland
AMSTERDAM • BOSTON • HEIDELBERG • LONDON • NEW YORK • OXFORD
PARIS • SAN DIEGO • SAN FRANCISCO • SINGAPORE • SYDNEY • TOKYO
Butterworth-Heinemann is an imprint of Elsevier
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Butterworth-Heinemann is an imprint of Elsevier
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Copyright © 2007, Dennis Nickson. Published by Elsevier Ltd. All rights reserved
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ISBN–13: 978-0-7506-6572-8
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Contents
List of figures ix
List of tables x
List of abbreviations xi
Preface xiii
Chapter 1 Human resource management and the tourism
and hospitality industry: An introduction 1
Introduction 2
What are the tourism and hospitality industries? 3
Who makes up the tourism and hospitality workforce?
A brief snapshot 6
What is HRM? 7
Models or reality? 15
The bad news … pessimistic views of HRM in tourism
and hospitality 17
The good news … best practice in tourism and
hospitality 20
Where this book stands 21
Conclusion 22
References and further reading 23
Websites 24
Chapter 2 International human resource management 26
Introduction 27
The emergence of IHRM 27
MNCs and HRM policies and practices in the tourism
and hospitality industry 44
Conclusion 46
References and further reading 47
Websites 49
v
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES vi
Chapter 3 Organizational culture 50
Introduction 51
In search of a definition 51
Competing views on organizational culture 53
How can we study organizational culture? 56
Organizational culture and HRM: a reprise 65
Conclusion 67
References and further reading 67
Websites 69
Chapter 4 Labour markets 70
Introduction 71
Levels of analysis in the labour market 71
The internal labour market and the utilization of
flexible labour 80
Conclusions 85
References and further reading 85
Websites 86
Chapter 5 Recruitment and selection 87
Introduction 88
Recruitment 90
Selection 104
Conclusion 111
References and further reading 111
Websites 113
Chapter 6 Equal opportunities and managing diversity 114
Introduction 115
The employment experience of socially defined
minority groups 116
The legislative response 122
Managing diversity 133
Conclusion 137
References and further reading 138
Websites 139
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Chapter 7 Training and development 141
Introduction 142
Understanding the context: national level responses
to training 142
N/SVQs 146
Investors in people 147
Apprenticeships 151
Industry level 152
Training and development: no longer a dichotomy? 153
Conducting training 157
Conclusion 164
References and further reading 165
Websites 167
Chapter 8 Performance management and performance appraisal 168
Introduction 169
The nature of performance management and
performance appraisal 170
Appraisal in practice 172
Managing poor performance 185
Conclusion 186
References and further reading 186
Websites 187
Chapter 9 Reward strategies in the tourism and hospitality
industry 188
Introduction 189
Employee and employer views of pay 189
Remuneration in tourism and hospitality 196
The practice of tipping 206
Fiddles and knock-offs 209
Other benefits 210
Conclusion 211
References and further reading 212
Websites 214
CONTENTS vii
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Chapter 10 Employee relations, involvement and participation 215
Introduction 216
Employee or industrial relations? 217
Trade unions: in terminal decline? 222
Employee involvement and participation 228
Conclusion 237
References and further reading 238
Websites 240
Chapter 11 Welfare, health and safety 241
Introduction 242
Absence management 243
AIDS/HIV 247
Alcohol/drug misuse 252
Sexual harassment 256
Smoking 264
Stress 266
Working time 270
Workplace violence 273
Conclusion 274
References and further reading 275
Websites 278
Chapter 12 Grievance and disciplinary procedures 279
Introduction 280
Setting the scene on grievance and disciplinary
procedures 280
Conclusion 290
References and further reading 291
Websites 292
Chapter 13 Concluding comments 293
References 296
Index 297
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List of figures
1.1 The HRM cycle 16
3.1 HRM and culture: contradictions and dilemmas 66
5.1 Sources of recruitment in the hospitality industry 102
7.1 The principles of the IiP standard 149
11.1 Some negative effects of stress for the individual and organization 267
12.1 Typical disciplinary procedure 286
ix
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List of tables
2.1 A geocentric human resource profile 31
2.2 Advantages and disadvantages of using PCNs, TCNs and HCNs 34
4.1 Hotel demands variability 78
6.1 Anti-discriminatory legislation 123
6.2 Differences between managing diversity and equal opportunities 135
7.1 Levels of analysis for understanding approaches to training 143
and development
7.2 VET policies and practices in selected countries 144
8.1 Features of performance management 170
8.2 Criteria used to measure individual performance 181
9.1 How the UK NMW has evolved since 1999 204
9.2 Comparison of the level of the adult minimum wage across
selected countries, end 2004 205
10.1 Union density in selected countries 224
10.2 Direct communication and information sharing techniques 229
x
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List of abbreviations
ACAS Advisory Conciliation and Arbitration Service
AIDS Acquired Immune Deficiency Syndrome
BA British Airways
BHA British Hospitality Association
CIPD Chartered Institute of Personnel and Development
CEHR Commission for Equality and Human Rights
CRE Commission for Racial Equality
DDA Disability Discrimination Act
DRC Disability Rights Commission
DTI Department of Trade and Industry
EOC Equal Opportunities Commission
EAP Employee Assistance Programme
ET Employment Tribunal
EU European Union
EWC European Works Councils
HCN Host-Country Nationals
HIV Human Immunodeficiency Virus
HRD Human Resource Development
HRM Human Resource Management
HSE Health and Safety Executive
ICE Information and Consultation of Employees Regulations 2004
(ICE Regulations)
IDS Income Data Services
IIP Investors in People
IRS Industrial Relations Services
IHRM International Human Resource Management
JCC Joint Consultative Committees
LPC Low Pay Commission
LRD Labour Research Department
MNC Multinational Company
xi
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NMW National Minimum Wage
N/SVQ National/Scottish Vocational Qualification
PCN Parent-Country National
QC Quality Circles
RFO Race for Opportunity
RRA Race Relations Act
SSC Sector Skills Council
SDA Sex Discrimination Act
SME Small and Medium-sized Enterprise
TCN Third-Country National
TGWU Transport and General Workers Union
TQM Total Quality Management
WERS Workplace Employment Relations Survey
WTR Working Time Regulations
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Preface
This book stems from a longstanding interest in how tourism and hospitality
organizations and managers seek to manage their employees. As a highly labour-
intensive industry, tourism and hospitality organizations are often heard to talk of
how their people are ‘their greatest asset’. However, even a cursory understanding
of the nature of work, employment and people management in tourism and hos-
pitality points to the many paradoxes and contradictions that are apparent in
studying human resource management (HRM) in the sector. This book aims to
explore some of these paradoxes and contradictions in seeking to submit the cliché
of ‘our people are our greatest asset’ to critical scrutiny. That said, the book is in
many respects a standard HRM text for the tourism and hospitality sector, recog-
nizably following the traditional concerns of organizations as to how they best
attract, maintain and develop an effective workforce.
In talking about tourism and hospitality the book is also aware of the many
debates about how the sector is best conceptualized. There are many common attrib-
utes that are associated with both hospitality and tourism activities, which could
encourage them to be seen synonymously. Equally though some would argue for dis-
tinctiveness between the two. Like most colleagues writing in this area the book
acknowledges these debates, whilst also at times rather fudging the distinction
between tourism and hospitality. In fudging what some might consider a largely
semantic debate it is important not to lose sight of the one thing that is clearly para-
mount in all organizations in tourism and hospitality: the need to deliver service to
customers and the need to manage people in such a way that they offer a quality serv-
ice. The manner though in which organizations in different countries, cultures and
market niches address this issue may vary enormously and this difference sustains
many of the concerns outlined in this book. Indeed, an appreciation of culture – and
the importance of organizational culture in particular – is a strong, and hopefully
novel, feature for a book of this nature.
In attempting to understand the importance of context to explain HRM prac-
tices this book also aims to be international in its focus and its use of sources and
examples. Thus, whilst the primary focus of the book is the UK, there are numerous
xiii
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examples from a variety of other countries across the world. The same point is also
true in terms of examples of organizational practice. A number of examples are
drawn from what is usually described as the commercial hospitality sector, which is
well served by research. Many of those activities which are more oriented towards
travel and tourism are also represented, though material of this nature is not quite so
voluminous. A further aspect of context is the need to understand the dynamic
and changing environment in which tourism and hospitality organizations operate.
Political, economic, social and technological changes significantly affect tourism and
hospitality organizations and the experience of work for those people who work in
the sector; and the book is cognizant of this point throughout. This dynamism is also
apparent with regard to emergent debates about new concepts which allow for an
appreciation of the changing nature of the employment experience of the tourism
and hospitality workforce. For example, work I have done with colleagues on aes-
thetic labour – how employees embody the tourism and hospitality product by
‘looking good’ or ‘sounding right’ – points to the manner in which organizations
increasingly take an interest in their employees’ appearance as a source of competi-
tive advantage. This book is designed to provoke thought and debate about aes-
thetic labour and a myriad of other issues and encourage the readership to challenge
its conclusions and stimulate further reading and research.
As has already been stated this book is the culmination of a longstanding interest
in the area of tourism and hospitality employment, both as teacher and researcher. In
that sense it is also an opportunity to draw on many of the ideas and writings of innu-
merable students and colleagues who have influenced my thinking. In particular, I
would very much like to acknowledge a huge debt to the work of Tom Baum, Yvonne
Guerrier, Rosemary Lucas and Roy Wood. Over the years they have given freely of
their time, advice and ideas, and shaped many of the ideas expressed in this book. I
hope this book can take its place alongside the work of my illustrious colleagues in
encouraging students and practitioners to think about how to improve the working
lives of the many who rely on tourism and hospitality for their employment.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES xiv
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Chapter 1
Human resource
management and the
tourism and hospitality
industry: An
introduction
Chapter objectives
This chapter sets the scene for the book. It considers
the nature of the tourism and hospitality industry
and some of the approaches to managing people
adopted by organizations and how these approaches
can vary. Therefore the aims of this chapter are:
? To recognize the importance of tourism and
hospitality as an employment sector.
? To outline the diverse range of sub-sectors and
occupations within the broad heading of
tourism and hospitality.
? To consider the nature of the workforce.
? To review the range of models/theories
concerned with human resource management
(HRM) and how these might be applied to the
tourism and hospitality sector.
1
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Introduction
The importance of tourism and hospitality employment in both developed and
developing countries is attested to by the World Travel and Tourism Council (WTTC),
who suggest that travel- and tourism-related activities account for over 230 million
jobs, or 8.7 per cent of jobs worldwide (WTTC, 2006). However, whilst the quantity
of jobs is unquestionable, the quality of many of these jobs is of great concern to aca-
demics and policy-makers alike. Despite the rhetoric of policy-makers and business
leaders that people are the industry’s most important asset, many remain uncon-
vinced that such a view is borne out by empirical evidence. For example, Douglas
Coupland, the notable cultural commentator, has for many captured the zeitgeist
when he talks pejoratively of ‘McJob’ which he describes as, ‘Alow-pay, low-prestige,
low-dignity, low-benefit, no-future job in the service sector. Frequently considered a
satisfying career choice by people who have never held one’ (Coupland, 1993: 5; and
see also Lindsay and McQuaid, 2004). MacDonald and Sirianni (1996) recognize the
challenges of living and working in a service society which, according to them, is
characterized by two kinds of service jobs: large numbers of low-skill, low-pay jobs
and a smaller number of high-skill, high-income jobs, with few jobs being in the
middle of these two extremes. Such a situation leads labour analysts to ask what
kinds of jobs are being produced and who is filling them. This point is also true for
the tourism and hospitality industry and it is important at the outset of this book to
add a caveat about the generalizability (or otherwise) of the conditions of tourism
and hospitality employment worldwide. Hence Baum (1995: 151) reflecting the
diversity of employment within the sector notes that:
In some geographical and sub-sector areas, tourism and hospitality provides
an attractive, high-status working environment with competitive pay and
conditions, which is in high demand in the labour force and benefits from
low staff turnover … The other side of the coin is one of poor conditions, low
pay, high staff turnover, problems in recruiting skills in a number of key
areas, a high level of labour drawn from socially disadvantaged groups, poor
status and the virtual absence of professionalism.
Organizations and managers in the tourism and hospitality industry face real chal-
lenges in recruiting, developing and maintaining a committed, competent, well-
managed and well-motivated workforce which is focused on offering a high-quality
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‘product’ to the increasingly demanding and discerning customer. This book seeks
to address some of the key human resource (HR) issues that have to be tackled in
order that organizations can maintain such an environment. To do so it will critically
review some of the problems which lead many to characterize tourism and hospital-
ity employment as generally unrewarding and unappealing, whilst also considering
examples of good practice, important policy responses and models of HRM which
may offer cause for greater optimism in the way people are managed within the
tourism and hospitality industry.
What are the tourism and hospitality industries?
Many academics, industrialists and policy-makers have attempted to define the
nature of the tourism industry – and the place of the hospitality sub-sector within
this broader conceptualization – yet there is still no one commonly accepted def-
inition. Hence, there are inherent problems seeking to define what is a large and
diverse sector, which means many of the activities may overlap, and could be
described as encompassing tourism and hospitality. For example, Lucas (2004) in
her recent work on employment relations in the hospitality and tourism industries
chose to talk in broad terms about the Hotel, Catering and Tourism Sector (HCTS).
This characterization of the HCTS recognizes that, in reality, many jobs in hospi-
tality and tourism, ‘share common attributes and are associated with both hospi-
tality and tourism activities’ (p. 4). Clearly, then, we should recognize the potential
for a lack of precision in describing the tourism and hospitality industries.
In an attempt to avoid too much imprecision and, at the same time, capture the
diversity of the sector this book uses the framework offered by People 1st, which
is the Sector Skills Council (SSC) for the hospitality, leisure, travel and tourism sector,
to exemplify the broad range of activities that may be seen in the HCTS. The reason
for using People 1st is that SSCs are the government-licensed bodies in the UK respon-
sible for improving skills within the industry. SSCs are employer led and amongst
other things aim to be the voice of industry on skills matters and encourage best prac-
tice approaches to employment (and see Chapter 7 for the role of People 1st in improv-
ing skills and training in hospitality, leisure, travel and tourism). Therefore, People 1st
suggest that the sector as a whole is made up of 14 sub-sectors (People 1st, 2006):
? hotels;
? restaurants;
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? pubs, bars and night-clubs;
? contract food service providers;
? membership clubs;
? events;
? gambling;
? travel services;
? tourist services;
? visitor attractions;
? youth hostels;
? holiday parks;
? self-catering accommodation;
? hospitality services.
Moreover within this broad classification of travel, tourism and hospitality there is
massive diversity in the types of jobs generated, in relation to their technical and
skills’ demands, educational requirements, terms and conditions and the type of
person that is likely to be attracted to employment in them. To illustrate this point
we can consider Baum’s (1997: 97–98) description of the range of people a person
buying a package holiday is likely to interact with:
? the retail travel agent;
? insurance companies;
? ground transport to and from the airport;
? at least two sets of airport handling agents (outbound and return);
? airport services (shops, food and beverage outlets, bureaux de change) (out-
bound and return);
? the airline on all legs of the journey;
? immigration and customs services;
? local ground transportation;
? the hotel or apartment;
? tour services at the destination;
? companies and individuals selling a diversity of goods and services at the des-
tination (retail, food and beverage, entertainment, cultural and heritage, financial,
etc.);
? emergency services at the destination (medical, police, legal);
? service providers on return (photography processing, medical).
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Baum characterizes all of these possible intermediaries, and the interactions they
will have with the holiday maker, as crucial in ‘making or breaking the tourist
experience’. Thus while the physical product is important, for most tourists the
quality of their experience is likely to be also reliant to a large degree on the inter-
actions they will have with the variety of front-line staff in the travel, tourism and
hospitality industry. These so-called ‘moments of truth’ (Carlzon, 1987) are therefore
crucial for organizational effectiveness, success, competitiveness and profitability.
Indeed, within an industry that is characterized by diversity and heterogeneity in
terms of the purpose, size, ownership and demands of the enterprise, the only real
point of homogeneity is delivering service to customers and the need to manage
people in such a way that they offer a quality service. The corollary of this point
would be the belief that such front-line staff would therefore be sufficiently well
paid, trained and motivated to offer outstanding service. The reality however is that
often such staff have the lowest status in the organization, are the least trained, and
are the poorest paid employees of the company.
In recognizing the diversity both of the range of sub-sectors and types of jobs
they are likely to generate, this book cannot consider all of these aspects in detail.
Indeed, more is known about employment in certain sub-sectors than others. For
example, the commercial hospitality industry encompassing hotels, restaurants
and pubs, bars and nightclubs is the largest sub-sector with around 70 per cent of
employees in the UK (People 1st, 2006). Unsurprisingly, then, the commercial hos-
pitality industry is well served with extensive research on the nature of employ-
ment and HRM strategies (D’Annunzio-Green et al., 2002; Lucas, 2004). On the
other hand, little has been written on the events industry or the nature of HRM in
youth hostels, for example. As a consequence many of the examples drawn on in
this book are from the commercial hospitality industry, although, where possible,
illustrations of organizational practice from travel and tourism organizations are
also used. Ultimately, the main aim of the book is to attempt to understand the
potentially diverse employment experience of those working in what we will
broadly think of as the tourism and hospitality industries. Thus, how does the
experience of an airline flight attendant differ from that of a pot washer in the
kitchen in a small restaurant to a receptionist in the front desk of an international
hotel or to a tour rep working on an 18–30-type holiday?
Afurther issue to consider is the manner in which the sector is heterogeneous
in terms of the predominance of small- and medium-sized enterprises (SMEs).
People 1st (2006) note that within the UK hospitality, leisure, travel and tourism
HRM AND THE TOURI SM AND HOSPI TALI TY I NDUSTRY 5
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sector 76 per cent of establishments employ fewer than ten people and 50 per cent
fewer than five. Heterogeneity is also seen in relation to the way that organizations
adopt differing routes to competitive advantage, depending on which type of mar-
ket they operate in. For example, full service carriers in the airline industry are
likely to have very different approaches to HRM compared to low-cost airlines
(Eaton, 2001; Spiess and Waring, 2005). The same is true for the hospitality sector,
which may range from first class and luxury hotels providing extravagant, full
24-hour service to the more homely comforts of a bed and breakfast establishment;
from fast food restaurants to Michelin starred restaurants. In turn, the jobs pro-
vided by these various organizations demand a variety of skills and attributes
from those employees interacting with customers, which again will impact on
HR strategies such as recruitment and selection and training.
Who makes up the tourism and hospitality
workforce? A brief snapshot
The International Labour Organization (ILO, 2001) in their wide-ranging report
on the global tourism and hospitality industry provides evidence that suggests
that the industry globally is largely reliant on what Wood (1997) has described as
so-called ‘marginal workers’, such as women, young workers, casual employees,
students, relatively high numbers of part-timers and migrant workers. For example,
within the UK women make up around 58 per cent of the broader hospitality,
leisure, travel and tourism workforce (People 1st, 2006). More specifically, the hos-
pitality sub-sector is indicative of the broader sector in having a higher proportion
of part-time employees (52 per cent) than most other industries with the all indus-
try figure being 25 per cent (HtF, 2003). Young people are also prominent within
the hospitality, leisure, travel and tourism sector. For example, 37 per cent of the
total UK workforce is under 24 years and 58 per cent under 34 years (People 1st,
2006). Related to this last point a significant part of the tourism and hospitality
workforce consists of student, seasonal and migrant workers. Students are an
increasingly important segment of the labour market for hospitality and tourism
organizations (ILO, 2001). They are prepared to work for low wages and be flex-
ible in their working patterns (Canny, 2002), creating what Curtis and Lucas (2001)
describe as a ‘coincidence of needs’ between employers and students. Thus, nearly
three quarters of all students who are working are employed in the retail and
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hospitality industries and the vast majority of students who are working do so in
front-line jobs such as sales assistants, waiters/waitresses and check out operators
(Curtis and Lucas, 2001; Canny, 2002). The number of ethnic minority workers in
the broader hospitality, leisure, travel and tourism sector is 11 per cent, slightly
higher than the all industry figure of 9.6 per cent (People 1st, 2006). With regard
to qualifications only 12 per cent of employees in hospitality, leisure, travel and
tourism have a degree or equivalent compared to an all industry figure of 29 per cent,
with 15 per cent of the workforce having no qualification compared to 11 per cent
of the total workforce (People 1st, 2006).
Having briefly considered the nature of the hospitality and tourism industry and
the characteristics of its workforce attention now turns to understanding HRM
and the increasingly important role it is felt to play in organizational success.
What is HRM?
Definitions of HRM
There have been many attempts to define what exactly HRM might be and indeed
Heery and Noon (2001) recognize that it is a subject of considerable academic analy-
sis and that, ultimately, ‘there is no common agreement on what HRM means’
(p. 161). Resultantly, they offer 10 definitions, which they feel capture the com-
plexity and dynamism of HRM as a subject of academic study:
? A label HRM is seen as simply being another name for personnel management
and there is nothing distinct or special about HRM.
? A convenient shorthand term that allows for the grouping together of a whole
series of sub-disciplines that are broadly concerned with people management:
such as employee relations, industrial/labour relations, personnel management
and organizational behaviour.
Review and reflect
If you are currently working in the tourism and hospitality industry whilst completing your
studies list what you consider good and bad aspects of your job and your reasons for this.
HRM AND THE TOURI SM AND HOSPI TALI TY I NDUSTRY 7
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? A map to help guide students and practitioners to understand the concept and
ideas associated with the management of people.
? Aset of professional practices suggests that there are a range of personnel practices
that can be integrated to ensure a professional approach to managing people. In
this view a potentially key role is likely to be played by the Chartered Institute
of Personnel and Development (CIPD), which is the professional association for
those entering the HR and personnel profession.
? Amethod of ensuring internal fit again sees the need to co-ordinate approaches to
people management, but here the co-ordination needs to be with other areas of
the organization.
? Amethod of ensuring external fit where HRM activities have to be fully integrated
with the demands of the external environment.
? A competitive advantage where HRM is the means by which an organization can
gain competitive advantage, a view best captured by the cliché of ‘our people
are our greatest asset’.
? A market-driven approach in that decisions will often be market driven and the
needs of the business determine the manner in which employees are treated;
some may be treated well, others less so well.
? Amanipulative device sees it as inherently exploitative and manipulative.
? Ahologramcaptures much of the above discussion in recognizing the fluid iden-
tity of HRM and the fact that it has multiple meanings.
Clearly what the above discussion points to is that HRM means many things to
many people, depending on whether you are a manager, an employee or an aca-
demic and there is no one definition that will adequately capture the potential
complexity of the topic.
That said, for the purposes of this book we will recognize HRM as being broadly
about how organizations seek to manage their employees in the pursuit of organ-
izational success. Reflecting this point the book utilizes the concise definition
offered by Storey (1995: 5). Thus, HRM ‘is a distinctive approach to employment
management which seeks to achieve competitive advantage through the strategic
Review and reflect
Which definition do you find most persuasive and why?
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deployment of a highly committed and capable workforce, using an integrated
array of cultural, structural and personnel techniques’. The challenge of HRM then
would seem to be how to recruit, deploy, develop, reward and motivate staff, lead-
ing to them being a source of competitive advantage. As the above discussion sug-
gests, however, there is more than one route to seeking competitive advantage and
this point is further considered in examining the notion of ‘hard’ and ‘soft’ HRM.
Hard vs. soft?
As well as providing the concise definition utilized above, Storey (1987) also
provided one of the earliest and most enduring attempts to recognize different
approaches to HRM. These different approaches are captured by the idea of hard
and soft HRM, each of which are now briefly described. The hard version is seen to
be an instrumental and economically rational approach to human resource man-
agement. In this view people management strategies are driven by strategic con-
siderations to gain competitive advantage, maximizing control while achieving
the lowest possible labour cost. This approach is quantitative and calculative and
labour is a commodity/resource, the same as any other. The focus is on human
resource management. On the other hand the soft version is seen to be much more
about adopting a humanistic and developmental approach to human resource
management. As a result an organization’s people management approach is likely
to be more consensual and based on a high level of managerial commitment to
employees, which is intended to lead to mutual high commitment from employ-
ees, high trust, high productivity and so on. Employees are seen as being proac-
tive, capable of being developed and worthy of trust and collaboration. This
approach focuses on human resource management.
What hard and soft approaches to HRM point to is that employers will vary their
people management strategies. Clearly as well there are likely to be a number of
external influences as HRM in practice 1.1 suggests. These external influences will
Review and reflect
Reflecting on your answers from the first review and reflect question to what extent do
the good and bad aspects you listed equate to hard or soft aspects of HRM?
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reflect a variety of political, social, economic and technological aspects which will
have an effect on HRM policies and practices. Hard and soft HRM point to the
manner then in which organizations can vary their approaches to HRM and as a
result the impact on employees may vary. Asimilar attempt to recognize that there
may be different approaches to HRM is also seen in the debate over whether
organizations should aim to achieve ‘best fit’ or ‘best practice’.
Best fit vs. best practice?
Boxall and Purcell (2000) suggest that attempts to understand the way in which
organizations approach the management of their HR can be seen with regard to
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 10
HRM in practice 1.1 Hard and soft approaches
to HRM in the airline industry
The tourism and hospitality industry is particularly sensitive to economic cycles and political
trouble and can be badly affected in times of uncertainty. For example, the global nature of
the industry means that it is vulnerable to external events that cause fluctuations in tourist
visits and spend. The global 2001–2004 economic downturn, 9/11, the Iraq war and the
outbreak of SARS in the Far East all led to a drop in revenue in the industry. These factors
reduced the number of travellers internationally and left uncertainty and fragility in the
tourism market. Many of these aspects are particularly pronounced in the airline industry
and trade unions have often railed against the manner in which employees are used as
‘shock absorbers’ to protect the industry from the cyclical nature of the market. These hard
approaches to HRM have seen major redundancy programmes in a number of airlines in
recent years, especially after 9/11. On the other hand, a number of companies have sought
a more soft approach to HRM which aimed at increasing the customer responsiveness of
their front-line staff. British Airways, for example, had a series of initiatives in the 1980s and
1990s such as ‘Putting People First’ and ‘Winning for Customers’. Amongst other things
these initiatives sought to introduce team working, extensive training programmes,
enhance quality procedures and multi-skill staff. As companies alternate between hard and
soft approaches to HRM employees may become confused as to what the company mes-
sage is. Ultimately, employees may well be a company’s ‘greatest asset’, but in times of
uncertainty and downturn are equally expendable as recent history suggests.
Derived from Grugulis and Wilkinson (2002); ITF (2004).
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whether they aim for ‘best fit’ or ‘best practice’. On the one hand, the best fit school
argues for an approach to HRM, which is fully integrated with the specific organ-
izational and environmental context in which they operate. On the other hand,
best practice advocates argue for a universalistic approach to HRM where all firms
who adopt a range of agreed HR policies and practices are more likely to create a
high-performance/commitment workplace, as organizations aim to compete on
the basis of high quality and productivity.
Best fit
One of the earliest and most influential attempts to develop a model that recog-
nized the need for a fit between the competitive strategy and HRM was that offered
by Schuler and Jackson (1987). Schuler and Jackson developed a series of typologies
of ‘needed role behaviours’ that enabled the link between competitive strategy and
HRM practices to be made. The type of needed role behaviours within Schuler
and Jackson’s model was contingent on the overall strategies that an organization
could adopt to seek competitive advantage and the HRM approached adopted to
sustain this.
First, there is an innovation strategy, where organizations seek to develop prod-
ucts or services that are different from competitors, such that the focus here is on
companies offering something new and different. Organizations adopting this
approach seek to develop an environment where innovation is allowed to flourish.
Resultantly, the employee needed role behaviour in such a scenario is character-
ized by things like a willingness to tolerate ambiguity and unpredictability, the
need to be creative and risk taking. Given these characteristics the type of HRM
strategy flowing from this approach is based on having a large number of highly
skilled individuals who are likely to enjoy high levels of autonomy. Second, is the
quality enhancement strategy wherein firms seek to gain competitive advantage by
enhancing the product and/or service quality. The approach once again points to
certain HRM practices to support a total-quality approach. These practices include
the encouragement of feedback systems, teamwork, decision-making and respon-
sibility being an integral part of an employee’s job description and flexible job clas-
sifications. The intent of these practices is to create needed employee behaviour
such as co-operative, interdependent behaviour and commitment to the goals of
the organization. Lastly, the cost reduction strategy sees firms attempting to gain
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competitive advantage by aiming to be the lowest-cost producer within a particu-
lar market segment. The characteristics of firms seeking to pursue this strategy are
tight controls, minimization of overheads and pursuit of economies of scale, in the
pursuit of increased productivity. In following such a strategy organizations may
use higher number of part-timers, seek to simplify and measure work via nar-
rowly defined jobs that encourage specialization and efficiency, and offer short-
term results oriented appraisal. Needed employee behaviours include, repetitive
and predictable behaviour, low-risk taking activity and a high degree of comfort
with stability.
This support for the importance of HRM practices ‘fitting’ the organizations
own strategically defined market segment to create a fit between the functional areas
of marketing, operations and HRM is also seen in the work of Lashley and Taylor
(1998). Lashley and Taylor describe four basic archetypes within which tourism and
hospitality organizations can be potentially located. These archetypes are the service
factory, the service shop, mass service and professional services. These characteriza-
tions are based on the degree of customization and labour intensity involved in the
service offer, in terms of the degree of customer contact required between employees
and customers.
The service factory is relatively low labour intensity and low customization
(i.e. high standardization). The service factory is most obviously exemplified by
fast food operators, especially McDonald’s. The service shop involves more cus-
tomization, but relatively low labour intensity. The defining difference to the ser-
vice factory lies in the degree of standardization within the process. Lashley and
Taylor draw upon the example of TGI Fridays to argue that although there are
high levels of standardization in the tangible aspects of the organization, such as
the menus, layouts, décor and staff uniform, there is also some scope to customize
the customers’ eating and drinking experience. This customization is by virtue of
their more extensive menu, and more importantly, greater spontaneity and
authenticity in the intangible aspects of the service provided by front-line staff.
The next classification is mass service where service processes involve a relatively
high degree of labour intensity, though a limited amount of customization.
Lashley and Taylor assert that the Marriott hotel brand typifies a mass service
organization, as their four star offering is similar to others in relation to the tan-
gibles reflecting the highly competitive nature of the mid to upper segment of the
hotel market. As a result of this convergence of the tangibles the key lies in the
intangibles and the scope available to organizations to differentiate themselves
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on the basis of service quality. Within this process of differentiation a key role is
played by the staff via the relatively high level of contact with customers. The final
grouping is professional services where there is a high level of service to individual
customers and a high degree of labour intensity, as exemplified by hospitality
management consultants.
The key point which emerges from the work of Lashley and Taylor is the likely
relationship between the service operation type adopted by the organization and
the style of HRM which best fits it. For example, it is apparent that in the four star
hotel sector a broadly soft approach to HRM, as exemplified by high discretion in
relation to the intangibles, moral involvement and a moderate trust culture, is sug-
gested as being important to sustain a high quality, total quality management (TQM)
based approach to the service offering. At the other end of the spectrum, McDonald’s
are suggested as exemplifying a command and control style which is characterized
by things such as low discretion for employees, limited responsibility and auton-
omy, and scripted service encounters. Importantly, Lashley and Taylor (1998: 161)
see the command and control approach as being right for what McDonald’s are
aiming to offer their customers:
… the historic success of the McDonald’s organization in delivering their
market offer … is partly due to the ability to develop and maintain a close fit
between the key characteristics of the strategic drivers and actual service
delivery through utilization of an appropriate HRM style.
The key point remains that organizations in developing a certain product
market strategy then ensure that their HR policies and practices are congru-
ent and cost effective with this strategy.
Best practice
Whilst arguments for best fit advocate a close fit between competitive strategies
and HRM, those in favour of best practice approaches to HRM suggest that there
is a universal ‘one best way’ to manage people. By adopting a best practice approach
it is argued that organizations will see enhanced commitment from employees
leading to improved organizational performance, higher levels of service quality
and ultimately increases in productivity and profitability. Usually couched in terms
of ‘bundles’, the HRM practices that are offered in support of a high commitment
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and performance model are generally fairly consistent. For example, Redman and
Matthews (1998) outline a range of HR practices which are suggested as being
important to organizational strategies aimed at securing high-quality service:
? Recruitment and selection: Recruiting and selecting staff with the correct attitu-
dinal and behavioural characteristics. A range of assessments in the selection
process should be utilized to evaluate the work values, personality, interper-
sonal skills and problem-solving abilities of potential employees to assess their
‘service orientation’.
? Retention: The need to avoid the development of a ‘turnover culture’, which
may of course be particularly prevalent in tourism and hospitality. For example,
the use of ‘retention bonuses’ to influence employees to stay.
? Teamwork: The use of semi-autonomous, cross-process and multi-functional teams.
? Training and development: The need to equip operative level staff with team
working and interpersonal skills to develop their ‘service orientation’ and man-
agers with a new leadership style which encourages a move to a more facilita-
tive and coaching style of managing.
? Appraisal: Moving away from traditional top down approaches to appraisal and
supporting things such as customer evaluation, peer review, team-based per-
formance and the appraisal of managers by subordinates. Generally, all of these
performance appraisal systems should focus on the quality goals of the organ-
ization and the behaviours of employees needed to sustain these.
? Rewarding quality: A need for a much more creative system of rewards and in
particular the need for payment systems that reward employees for attaining
quality goals.
? Job security: Promises of job security are seen as an essential component of any
overall quality approach.
? Employee involvement and employee relations: By seeking greater involvement from
employees the emphasis is on offering autonomy, creativity, co-operation and
self-control in work processes. The use of educative and participative mechanisms,
such as team briefings and quality circles are allied to changes in the organization
of work which support an ‘empowered’ environment.
In simple terms best practice is likely to entail attempts to enhance the skills base
of employees through HR activities such as selective staffing, comprehensive
training and broad developmental efforts like job rotation. Additionally, it also
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encourages empowerment, participative problem-solving, teamwork as well as
performance-based incentives.
Models or reality?
Of course ideal types and academic models may not always reflect the complex
reality of what really goes on in tourism and hospitality organizations. Schuler
and Jackson, for instance, freely admit the description of their three competitive
strategies as pure types often does not reflect the reality of, for example, organiza-
tions pursuing two or more competitive strategies simultaneously. The same point
can also be made with regard to hard and soft HRM; it is not uncommon for organ-
izations to vary their approaches to employees depending on any given practice.
For example, with regard to labour flexibility the use of numerical flexibility may
well reflect fairly hard approaches to HRM, whilst functional flexibility and multi-
skilling exemplifies a much softer approach (see Chapter 4). Afurther issue is the
predominance of SMEs in tourism and hospitality. It is often suggested that their
small scale means that they are unlikely to have the necessary means to employ
the kind of HRM expertize to develop sophisticated soft approaches, for example.
Nevertheless, they are still likely to require HR policies that require at least some
thought with regard to their business circumstances.
Whilst some understanding of debate about soft and hard and best fit and best
practice are important to place HR practices within a broader theoretical context,
in reality, regardless of these various ideal types all organizations have to manage
employees on a day-to-day basis. We can illustrate this in Figure 1.1, which out-
lines the notion of an HRM cycle.
Review and reflect
Think of an organization that you are familiar with, for example where you are currently
working or one where you have spent time on placement, to what extent do their HR
practices evidence either a best fit or best practice approach? Why would you characterize
it as best fit or best practice?
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Figure 1.1 is useful in allowing us to appreciate that these broad aspects of
attracting, maintaining and developing a workforce are constant and that organ-
izations and managers, both specialist HR and line managers, are wrestling with
HR issues on a day-to-day basis. However, whilst a number of the functional aspects
of HRM are unlikely to differ, the manner in which organizations actually develop
their overall strategy will. In these circumstances models that allow for recogni-
tion of differing strategic intent in HRM are still useful in allowing us to appreci-
ate why and how companies differ in their approaches to HRM in tourism and
hospitality. It would be naïve to imagine we could talk in very broad terms about
HRM in tourism in hospitality. The reality is far too complex and as we have already
noted the employment experience for employees can vary enormously depending
on the type of organization they work in and the job or role they have within their
organizations. With this recognition we should consider the key question: so what
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 16
• Attract an effective workforce
– HR planning/labour markets
– Recruitment and selection
• Maintain an effective workforce
– Rewards and welfare
– Labour relations (e.g. the role of trade unions)
– Grievance and disciplinary procedures
• Develop an effective workforce
– Training and development
– Appraisal
Figure 1.1 The HRM cycle
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does HRM in hospitality and tourism look like? Reflecting some of our earlier
discussion of hard and soft and best fit and practice we can also crudely distin-
guish between those who argue for a pessimistic view of HRM in the sector and
those who suggest that increasingly organizations are seeking a much more pro-
gressive approach to managing their employees.
The bad news … pessimistic views of HRM in
tourism and hospitality
Generally tourism and hospitality has often struggled with negative perceptions
about employment practices and conditions and this perception has often been
matched by the reality. Keep and Mayhew (1999) for example in their review of the
skills issue in the tourism and hospitality industry suggest the industry has a num-
ber of personnel problems, including:
? generally low wages, unless skill shortages act to counter this (e.g. chefs);
? unsocial hours and shift patterns that are not family friendly;
? overrepresentation of women and ethnic minorities in low-level operative pos-
itions, with better paid, higher status and more skilled jobs filled by men, pointing
to undeveloped equal opportunities policies in the sector;
? poor or non-existent career structures and use of casualized seasonal employment;
? over reliance on informal recruitment methods;
? lack of evidence of good practice personnel/HRM practices;
? little or no trade union presence;
? high levels of labour turnover;
? difficulties in recruitment and retention of employees.
Recognizing this reality of poor employment practices, Riley et al. (2000) argue that
economics is the key determining factor for HRM policies and practices in tourism
and hospitality. Of course this point is likely to be true of any industry, but as Riley
et al. point out it carries a particular resonance in tourism and hospitality, due to the
nature of the sector. That is not to say that organizations and managers in the indus-
try are not well aware of new managerial thinking on HRM. However, they also
find themselves wrestling with ‘traditional problems’, which are underpinned by
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‘fundamental labour economic imperatives’ (p. 120). Importantly, these problems
limit managerial actions and this leads Riley et al. to argue the behaviour of managers
is determined ‘by the structures and forms under which they live’ (p. 119). This
economic imperative creates a short-term perspective on managerial decision-
making and strategy in relation to HRM, and also means that management are
more likely to deploy a weak internal labour market. An obvious impact of this is
that HRM concerns of tourism and hospitality organizations are constantly directed
to short-term responses to issues such as recruitment, selection and basic training,
rather than more long-term areas which could conceivably offer more development
and career progression for existing employees.
Another reason for continuing pessimism is the general attitude of employers
and particularly the extent to which they are willing to recognize the extent of the
HRM problem in the sector. The DfEE (2000) registers with some incredulity the
awareness of low pay, for example, existing alongside the naïve view of employers
of tourism and hospitality as a ‘good’ employing sector. Thus, although in a number
of locations labour shortages were clearly reflective of an unwillingness of employers
to offer competitive pay and terms of conditions of employment, the DfEE (2000:
35) notes how, ‘We were struck by the extent to which employers described pay and
working conditions as “reasonable” or even “good” while at the same time report-
ing extensive recruitment problems, skills gaps and labour turnover.’ This disjunc-
ture between the views of employers and employees is also noted by the ILO in a
recent report on the international tourism industry. They recognize how:
Employers’ representatives generally consider that the turnover in the indus-
try should be attributed to the essentially transient nature of part of the
workforce, namely students, young mothers and young people as a whole,
as well as the general difficulty in retaining staff. Employees, on the other
hand, frequently cite low pay as a reason for changing employment, though
a lack of career structure and benefits would appear to be of even greater
importance (ILO, 2001: 6).
This inability by industry to recognize the most glaring of issues is long standing
and can also be seen in relation to things like a degree of hostility and opposition
from the employers associations in the industry, such as the British Hospitality
Association (BHA), to governmental initiatives such as the minimum wage and
working time directive. The BHA still remains unsure of the benefits of such
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initiatives, despite support from others who argue these initiatives are likely to
have a potentially positive impact on the industry (e.g. see Lucas, 2004).
Given the above discussion it is unsurprising to see a long history of support
for the proposition that tourism and hospitality remains a poor employing sector.
From Orwell’s Down and Out in Paris and London in the 1930s to recent work by the
likes of Price (1994), Kelliher and Perrett (2001), Kelliher and Johnson (1997) and
McGunnigle and Jameson (2000), the dominant paradigm has tended to stress the
negative aspects of working in the sector. For example, McGunnigle and Jameson
surveyed a selected number of hotels from the top 50 hotel groups ranked by own-
ership of bedroom stock, which were considered to be most likely to exhibit good
practice HRM. Despite this they concluded, ‘This study suggests that there is little
adoption of HRM philosophy in corporately owned hotels in the UK sample … [and
hospitality] … has a long way to go before it can claim that it is encouraging a “cul-
ture of commitment”’ (ibid. p. 416). Similarly, Kelliher and Perrett (2001), drawing
explicitly on Schuler and Jackson’s typology, develop a case study analysis of a
‘designer restaurant’. Such a restaurant might be though of as potentially develop-
ing a more sophisticated approach to HRM as they sought to differentiate them-
selves from chain establishments such as Hard Rock Café and TGI Friday’s.
However, although the restaurant had moved to a more sophisticated approach to
HRM in areas like planning, training and development and appraisal, and osten-
sibly sought an ‘innovation’ strategy, ‘there was little real evidence that human
resources were seen as a source of competitive advantage’ (p. 434). Instead, the
HRM approaches adopted by the restaurant were much more reflective of imme-
diate environmental constraints, such as the difficulties in recruiting and retaining
staff.
In sum, any number of reasons may account for poor personnel practice in the
tourism and hospitality industry. Economic determinism, the predominance of
SMEs, a low-skills base, employer antipathy to a more progressive approach to
HRM, labour market characteristics, organizations ensuring best fit HRM prac-
tices to support a high volume, low-cost strategy; all are plausible reasons for a
view of HRM which is not necessarily premised on high-skills, high-wages and a
high-quality route to competitive advantage. That said, it would be equally wrong
to paint a wholly pessimistic picture. It was recognized earlier in the chapter that
there are also examples of good practice HRM, particularly in certain sub-sectors
of the industry and in market segments where organizations are likely to seek
differentiation on the basis of offering high-quality services.
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The good news … best practice in tourism and
hospitality
Some of the most important work to emerge in recent years on the question of the
extent of good practice in the HCTS is the work of Hoque (2000). Based on his
work on the hotel sector, he argues that arguments which portray the industry as
backward and unstrategic are now outdated, at least where larger hotel establish-
ments are concerned. Indeed, he suggests that ‘it is perhaps time researchers
stopped highlighting the example of “bad management” and branding the indus-
try as under-developed or backward, and started identifying approaches to hotel
management capable of generating high performance’ (2000: 154). The research
conducted by Hoque consists of a questionnaire-based survey of 232 hotels and a
number of follow-up interviews conducted in targeted hotels, based on the results
of the survey.
Based on this research he discusses three key issues. First, the extent to which
hotels have experimented with new approaches to HRM. Secondly, the factors that
influence HRM decision-making and whether these factors are any different in the
hotel industry compared to elsewhere. Finally, he reviewed the relationship
between HRM and performance in the hotel industry. Hoque is able to claim that,
compared to a sample of over 300 greenfield-site manufacturing establishments,
the hotels in his sample where utilizing a number of practices that were very simi-
lar to best practice. Indeed, in illustrating the manner in which academic models
can, in reality, overlap it is also worth noting that there is significant overlap
between Schuler and Jackson’s quality enhancement and innovation approaches
with much of the ‘best practice’ approaches. This point about such overlap is
further illustrated in HRM in practice 1.2.
Hoque’s work remains useful in offering a description of organizational prac-
tices that support a professional, high-quality approach to service. That said, there
are a number of criticisms that can be levelled at the research (Nickson and Wood,
2000). As Hoque himself recognizes his sample of hotels is large by industry stand-
ards, averaging 125 employees per unit compared to an industry ‘standard’ of 81
per cent of establishments employing fewer than 25 people, and thus as Hoque
(2000: 51) himself recognizes ‘patently unrepresentative of the industry as a whole’.
Furthermore his reliance on city-centre hotels with a high proportion of corporate
clients is equally unrepresentative. Lastly, the reliance on managerial voices in his
research, to the exclusion of those on the receiving end of many of the initiatives
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described (i.e. employees), may be considered an important omission. To be fair,
Hoque’s exclusive reliance on managerial voices is not unique and is shared by
much of the literature on HRM. The key point emerging from the work of the likes
of Redman and Matthews and Hoque is what good practice HRM is likely to look
like in the tourism and hospitality industry.
Where this book stands
Whilst, Boxall and Purcell (2003: 61) suggest that ‘there is quite a lot of agreement
on what constitutes “bad” or “stupid” practice’ in relation to HRM, this does not
HRM AND THE TOURI SM AND HOSPI TALI TY I NDUSTRY 21
HRM in practice 1.2 The HRM quality
enhancer hotel
The hotel in Hoque’s (2000) research, which is termed the HRM quality enhancer hotel,
employed 140 staff and was part of a large international chain. In relation to their
approach to HRM a number of practices were prominent in the hotel. Recruitment and
selection emphasized the need for employees to have an aptitude for customer care,
although this tended to be ‘spotted’ at interview rather than through psychometric or
behavioural tests. The hotel used extensive induction programmes to lessen the poten-
tial of employee turnover. The use of cross-functional teams aimed to generate co-
operation and team building and staff were encouraged to view the hotel as a unit rather
than a collection of discrete functions. Allied to this extensive multi-skilling and cross-
functional flexibility was encouraged, this ‘cross-exposure’ allowed staff to see a number
of the other parts of the hotel. There was extensive decentralization, which sought to
encourage responsible autonomy, for example through a well-understood empower-
ment scheme operating in the hotel. Consultation via a representative consultative com-
mittee allowed employees to voice their views on the running of the hotel. Further to this
consultation the hotel also operated an annual attitude survey. Employees were
appraised on a yearly basis. The appraisal system was used for succession planning and
the hotel was also working towards linking appraisal with a merit-based remuneration
system. Employees were also encouraged by a strong internal labour market which
promoted from within, whenever possible. Finally, throughout the hotel there was an
overriding emphasis on quality and the need to offer ‘outstanding customer service’.
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stop organizations often developing rather bad or stupid HR practices. As we have
already noted tourism and hospitality is likely to offer huge diversity with regard
to HRM policies and practices and it would be nice to think that these are rarely
bad or stupid. Experience equally tells us though that this is not always the case.
In recognizing this point, this book aims to develop a realistic account of how
employers in tourism and hospitality develop and implement their HRM policies
and practices and what this will mean for employees. It will certainly celebrate
good practice, but equally will not be afraid to point to bad practice. This senti-
ment points to the fact whilst best practice is something to which organizations
should aspire to, the reality is that there may be a number of constraints in achiev-
ing best practice, a point which Boxall and Purcell (2000: 199) recognize:
While all employers will benefit from avoiding the real ‘howlers’ of HRM prac-
tices that are well known for their dysfunctional or perverse consequences –
they are often constrained by industry and organizational economics from
implementing a deluxe version of best practice.
In sum, whilst all tourism and hospitality employers are, for a variety of rea-
sons, unlikely to aspire to the deluxe version of best practice they should at least
aim to avoid the real howlers as suggested by Boxall and Purcell. The remainder of
the book considers how they might do this in considering policies and practices in
a variety of organizational and occupational settings.
Conclusion
This chapter recognized the importance of tourism and hospitality as an employment
sector. The sector provides a large and diverse number of jobs and will be important
for future job creation throughout the developed and developing world. Whilst the
number of jobs produced by the tourism and hospitality industry is impressive there
are some concerns about the type of employment experience within the sector. The
nature of the labour market and the reliance on ‘marginal’ workers has led to a
number of pessimistic views of HRM practice. More upbeat accounts point to the
manner in which concerns with providing good-quality service are improving HR
practices. Underlying this debate are a number of models of HRM which provide a
framework in which to locate the strategies adopted by tourism and hospitality
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organizations. Ultimately though we have to be cautious to not over generalize the
nature of HRM in tourism and hospitality and there is a need to examine differing
practices and try to understand why these differences might exist.
References and further reading
Baum, T. (1995) Managing Human Resources in the European Hospitality and Tourism Industry – A
Strategic Approach, Chapman and Hall.
Baum, T. (1997) ‘Making or breaking the tourist experience: the role of human resource management’, in
C. Ryan (ed.) The Tourist Experience: A New Introduction, Cassell, 92–111.
Boxall, P. and Purcell, J. (2000) ‘Strategic human resource management: where have we come from and
where should we be going?’, International Journal of Management Reviews, 2(2), 183–203.
Boxall, P. and Purcell, J. (2003) Strategy and Human Resource Management, Palgrave.
Canny, A. (2002) ‘Flexible labour? The growth of student employment in the UK’, Journal of Education and
Work, 15(3), 277–301.
Carlzon, J. (1987) Moments of Truth, Ballinger.
Cheng, A. and Brown, A. (1998) ‘HRM strategies and labour turnover in the hotel industry: a comparative
study of Australia and Singapore’, International Journal of Human Resource Management, 9(1), 136–154.
Coupland, D. (1993) Generation X: Tales for an Accelerated Culture, Abacus.
Curtis, S. and Lucas, R. (2001) ‘A coincidence of needs? Employers and full-time students’, Employee
Relations, 23(1), 38–54.
D’Annunzio-Green, N., Maxwell, G. and Watson, S. (2002) Human Resource Management: International
Perspectives in Hospitality and Tourism, Continuum.
Department for Education and Employment (2000) Employers Skill Survey: Case Study Hospitality Sector, DfEE.
Eaton, J. (2001) Globalization and Human Resource Management in the Airline Industry, Ashgate.
Grugulis, I. and Wilkinson, A. (2002) ‘Managing culture at British Airways: hype, hope and reality’, Long
Range Planning 35(2), 179–194.
Heery, E. and Noon, M. (2001) A Dictionary of Human Resource Management, Oxford University Press.
Hoque, K. (2000) Human Resource Management in the Hotel Industry, Routledge.
Hospitality Training Foundation (2003) Labour Market Review 2003, HtF.
International Labour Organization (2001) Human Resource Development, Employment and Globalization
in the Hotel Catering and Tourism Sector, ILO.
International Transport Workers Federation (ITF) (2004) ‘The cuts don’t work’, available at http://www.
itfglobal.org/transport-international/ti10cuts.cfm (accessed 2 July 2006).
Jollife, L. and Farnsworth, R. (2003) ‘Seasonality in tourism employment: human resources challenges’,
International Journal of Contemporary Hospitality Management, 15(6), 312–316.
Keep, E. and Mayhew, K. (1999) The Leisure Sector (Skills Task Force Research Paper 6), DfEE.
Kelliher, C. and Johnson, K. (1997) ‘Personnel management in hotels – an update: a move to human
resource management?’, Progress in Tourism and Hospitality Research, 3, 321–331.
Kelliher, C. and Perrett, G. (2001) ‘Business strategy and approaches to HRM – a case study of new devel-
opments in the United Kingdom restaurant industry’, Personnel Review, 30(4), 421–437.
Lashley, C. and Taylor, S. (1998) ‘Hospitality retail operations types and styles in the management of human
resources’, Journal of Retailing and Consumer Services, 5(3), 153–165.
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Lindsay, C. and McQuaid, R. W. (2004) ‘Avoiding the “McJobs”: unemployed job seekers and attitudes to
service work’, Work, Employment and Society, 18(2), 297–319.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
MacDonald, C. and Sirianni, C. (1996) Working in the Service Society, Temple University Press.
Marchington, M. and Grugulis, I. (2000) ‘“Best practice” human resource management: perfect
opportunity or dangerous illusion?’, International Journal of Human Resource Management, 11(6),
1104–1124.
McGunnigle, P. and Jameson, S. (2000) ‘HRM in UK hotels: a focus on commitment’, Employee Relations,
22(4), 403–422.
Nickson, D. and Wood, R. C. (2000) ‘HRM in the hotel industry: a comment and response’, Human
Resource Management Journal, 10(4), 88–90.
Nickson, D., Baum, T., Losekoot, E. et al. (2002) Skills, Organizational Performance and Economic Activity
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People 1st (2006) Skills Needs Assessment, People 1st.
Price, L. (1994) ‘Poor personnel practice in the hotel and catering industry – does it matter?’, Human
Resource Management Journal, 4(4), 44–62.
Redman, T. and Matthews, B. (1998) ‘Service quality and human resource management: a review and
research agenda’, Personnel Review, 27(1), 57–77.
Riley, M., Gore, J. and Kelliher, C. (2000) ‘Economic determinism and human resource management prac-
tice in the hospitality and tourism industry’, Tourism and Hospitality Research, 2(2), 118–128.
Schuler, R. and Jackson, S. (1987) ‘Linking competitive strategy with human resource management’, The
Academy of Management Executive, 1(3), 207–219.
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Human Resource Management: A Critical Text, Routledge, 3–32.
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of General Management, 19(3), 20–32.
Wood, R. C. (1997) Working in Hotels and Catering, International Thomson Press, 2nd edition.
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202006.pdf (accessed 1 July 2006).
Websites
The Chartered Institute of Personnel and Development (CIPD) is the main professional body for HRM prac-
titioners in the UK. There website can be found at http://www.cipd.co.uk/default.cipd and includes a
number of downloadable items for non-members.
http:///www.hrmguide.co.uk/is a very good general guide to HRM issues in the UK. Within the site there is
also links to HRM issues and practices in a range of other countries including Australia and the US.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 24
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The International Labour Organization produced a very comprehensive report in 2001 on HR issues in global
tourism and hospitality and this can be found at: http:///www.ilo.org/public/english/dialogue/sector/techmeet/
tmhct01/tmhct-r.pdf
The Work Foundation (formerly the Industrial Society) has some interesting material on their site at
http://www.theworkfoundation.com/index.aspx
Caterer and Hotelkeeper is the trade magazine for the hospitality industry and has a search engine at
http:/ //www.caterersearch.com/Home/Default.aspx. The archive has numerous stories on aspects of HRM in
the sector.
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Chapter 2
International human
resource management
Chapter objectives
As tourism and hospitality organizations
increasingly internationalize they face a number
of challenges in managing their human resources.
This chapter considers these challenges and
specifically the aims of the chapter are:
? To consider the nature of international human
resource management (IHRM).
? To outline and discuss different strategic
dispositions to internationalization.
? To appreciate the importance of a multinational
company’s (MNC’s) country-of-origin and the
effects of host countries on HRM policy and
practice.
? To assess challenges facing MNCs operating
in the tourism and hospitality industry in
attempting to transfer HRM practices across
national boundaries.
26
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 27
Introduction
The continuing growth of world markets, increased availability of management
and technological know-how in different countries, advances in telecommunica-
tions, and greater regional political and economic integration are just some of the
factors that are increasingly leading to the globalization of many tourism and hos-
pitality MNCs. Resultantly, the contemporary tourism and hospitality industry is
increasingly global and this is important in a number of ways. As more and more
tourism and hospitality MNCs are now selling their products outside their home
countries they face a number of issues in terms of how they approach a range of
HRM issues. For example, to what extent will they try to transfer policies and
practices that are successful in the home country to host countries? In thinking
about the mix between parent country and local managers, how will they staff
their units overseas? The globalization of business is making it increasingly impor-
tant to understand how multinational enterprises can operate more effectively in
seeking to answer these types of questions. As they cross national boundaries
tourism and hospitality MNCs face many challenges related to issues like: lan-
guage, culture, economic and political systems, legislative frameworks, manage-
ment styles and conventions. To assess some of these issues the chapter will
consider the emergence of IHRM; and relatedly the issue of comparative HRM. In
many respects the former aspect is largely concerned with how MNCs manage
their geographically dispersed workforce. The latter aspect is more about why and
in what ways HR practices and policies may differ in a variety of different coun-
tries. Of course, these two aspects are very much intertwined. For example, MNCs
may attempt to transfer certain HRM practices and this process may be success-
fully achieved in certain countries and be much more problematic in others, the
chapter will seek to assess why this might be the case.
The emergence of IHRM
We should begin by firstly defining what IHRM is. Torrington (1994: 6) suggests
that, ‘In many ways IHRM is simply HRM on a larger scale; the strategic consid-
erations are more complex and the operational units more varied, needing co-
ordination across more barriers’. Aslightly different view is offered by Schuler et al.
(1993: 720), who define IHRM as, ‘human resource management issues, functions,
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 28
and policies and practices that result from the strategic activities of multinational
enterprises and that impact on the international concerns and goals of those enter-
prises’. In a similar vein Boxall (1995: 5) also locates the locus of IHRM primarily
within the choices faced by MNCs, and sees it as being, ‘concerned with the HR
problems of multinational firms in foreign subsidiaries (such as expatriate man-
agement) or, more broadly, with the unfolding HR issues that are associated with
the various stages of the internationalization process’. Thus, on the basis of these
definitions it can be seen that, compared to domestic HRM, IHRM is likely to
involve the MNC in more diverse activities, greater involvement in employees pri-
vate lives (e.g. the impact of the expatriation cycle), greater risk exposure, more
external influences and generally greater complexity than would be found man-
aging domestically. Most obviously these issues can be seen in terms of how
MNCs seek to co-ordinate and integrate a range of units throughout the world,
leading Schuler et al. (1993: 719) to ask a crucial question: ‘Can MNCs link their
globally dispersed units through HR policies and practices, and if so, how?’ In
many respects any attempt to answer this question can be found in the seminal
work of Howard Perlmutter.
Perlmutter: the ‘father’ of IHRM
Harzing (2004) is representative of much of the IHRM literature which suggests
that the typology outlined by Perlmutter (1969) is crucial in attempts to character-
ize the approach adopted by MNCs not only to HRM, but also finance and account-
ing, marketing and production. Indeed, Mayrhofer and Brewster (1996) recognize
how Perlmutter’s typology has become a virtual synonym of analytical approaches
to understanding IHRM, such that they talk of his role as the originator and ‘father’
of the discipline.
Perlmutter’s (1969) work attempts to delineate differing orientations, or
strategic dispositions, adopted by multinational organizations with his starting
point being that claims to multinationality should be based on more than simply
generating sales overseas. Consequently Perlmutter outlines an ethnocentric
approach which is home-country oriented, a polycentric approach which is host-
country oriented and a geocentric approach which is world-oriented (a further
orientation of regiocentric, i.e. regionally oriented, was added in 1979 by Perlmutter
and Heenan). In general, the ethnocentric strategy suggests that companies should
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 29
maximize their parent company control to integrate subsidiaries, at the cost of
local responsiveness. Resultantly the ethnocentrically oriented MNC believes in
the superiority of the way of doing things in the home country and this informs
their strategies for staffing and managing overseas units. Therefore this approach
implies centralized systems with authority high at headquarters with much com-
munication in the form of orders, commands and advice. Managers of the home
country of the parent company are, therefore, recruited, trained and developed for
key positions anywhere in the world to ensure that the home country approach is
easily transferred and that host-country nationals (HCNs) fully understand the
headquarters culture. The polycentric approach allows for more local responsive-
ness and is premised on the view that the MNC should respond to prevailing local
conditions where practicable. Hence, in this orientation local people know best
and organizations thus seek to pursue an approach of localizing operations as
quickly as possible. Local staff are employed in core positions in the host country
and enjoy high levels of autonomy and local opportunities for further promotion.
The final orientation of geocentrism is, as Caligiuri and Stroh (1995: 497) note,
‘When MNCs desire an integration of all of their foreign subsidiaries and the
melding of a worldwide corporate culture’. Consequently organizations seek
‘the best man (sic), regardless of nationality, to solve the problems anywhere in the
world’ (Perlmutter, 1969: 13). The geocentric approach envisages competitive
advantage emanating from the organization’s ability to draw on a rich array of
national and cultural perspectives, allowing for a global strategy which is also
respectful of local circumstances – the notion of ‘think global act local’.
Which of these approaches an international organization could be character-
ized by is dependent on attitudes inferred from ‘the assumptions upon which key
product, functional and geographical decisions were made’ (ibid.: 11). Importantly
though, Perlmutter feels that, ‘There is some degree of ethnocentricity, polycen-
tricity or geocentricity in all firms’ (ibid.: 11), and it is thus unlikely that any of
these orientations are ever found in pure form. Nonetheless Perlmutter argues
strongly that one predominant disposition can usually be discerned, with Pauuwe
and Dewe (1995: 84) suggesting that any dominant attitude or state of mind of the
corporation is likely to be ‘determined by the phase of internationalization in
which the company finds itself and by its history’. The implicit sense of an evolu-
tionary approach to internationalization is a clear and important theme of
Perlmutter’s work and equally clear is his recognition of the difficulties and com-
plexity of attaining the most advanced form of the ‘ideal’ geocentric approach,
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such that ‘The route to pervasive geocentric thinking is long and torturous’ (1969:
16). This view that the most developed form for the MNC is the geocentric ‘ideal’
is something now routinely supported in much of the international business and
management literature, as exemplified by Caligiuri and Stroh (1995: 495) who sug-
gest that the geocentric strategy is:
… the ‘ideal’, as it attempts to balance both global integration and local
responsiveness. In a hierarchy, the geocentric strategy would be the best
because it incorporates both of the theoretical ideals. Polycentric and regio-
centric strategies would be second because they satisfy the local responsive-
ness ideal (usually at the cost of global integration). Ethnocentric strategies,
focusing on headquarters control are neither globally integrated nor locally
responsive.
Ashift to a global orientation is likely to be dependent on the organization having
the wherewithal to create and appoint a pool of genuinely ‘global’ managers, assum-
ing this is in fact possible. This approach requires a sophisticated HR planning sys-
tem and training infrastructure to enable an organization to enact such a strategy.
Some of the issues engendered by this discussion are identified in Table 2.1, which
suggests some of the implications for organizations which wish to pursue a geocen-
tric HRM strategy.
The impact of centricity in the tourism and hospitality industry
Roper et al. (1997, 1998) examine the factors that influence and determine success for
international hotel groups in the global market place. They argue that centricity –
defined by them as an approach to international management – is one of the key
factors that influence all business decisions and their subsequent successful imple-
mentation. Consequently they examine the possible causal relationship between
centricity and organizational success and particularly whether organizations
should be seeking to move to the geocentric ‘ideal’. Interestingly they disaggregate
centricity at a number of levels both in terms of orientation and functional areas of
management. First, they suggest that centricity can be viewed from three interre-
lated perspectives: management’s mind set and the attitudes and beliefs of key
senior managers in the organization; corporate strategic predisposition and the
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 31
way this will shape the company’s mission, governance structure, strategy, organ-
ization structure and organizational culture; and finally, subsidiary level predilec-
tion. Of these, Roper et al. suggest that the first two have the most influence,
particularly in the way that management attitudes and beliefs will inform and dic-
tate strategic and operating decisions.
Nickson (1999) reports research from three pseudonymous tourism and hospi-
tality companies, Americo, Frenco and Swedco. Using Perlmutter’s framework the
three companies evidenced differing orientations, as outlined in HRM in practice 2.1.
Review and reflect
What are some of the likely advantages and disadvantages of companies pursuing an
ethnocentric, polycentric or geocentric approach to internationalization?
Table 2.1 A geocentric human resource profile
Organization Key decision makers from diverse backgrounds operating
on a global basis.
Company culture Integrated and draws on experiences, attitudes and
beliefs held by people from different countries.
Recruitment Based on ability rather than nationality. Recruits drawn
from a range of different countries to core positions.
Training and development Managers from all countries treated as equal. People
developed through a range of overseas assignments and
drawn together in cross-cultural teams to learn from each
other.
Terms and conditions General principles adopted which draw on practice from
around the globe yet also allow for a response to local
circumstances.
Employee relations General principles adopted which draw on best practice
from different countries. European Works Council,
international committees/task groups, etc. may be
established.
Source: Roper et al. (1997: 381) Reprinted by permission of the author.
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 32
International staffing
Afurther key issue in IHRM is the way in which MNCs seek to staff their overseas
unit. Contingent upon the predominant headquarters orientation – as based on
Perlmutter’s typology – MNCs are likely to use a mix of parent-country nationals
(PCNs), third-country nationals (TCNs) and host-country nationals (HCNs). For
example, MNCs may utilize PCNs in the early days of an overseas unit’s existence,
but over time it is likelier that TCNs and particularly HCNs will play an ever
HRM in practice 2.1 Orientations in the
global hotel industry
Americo was an American company who had internationalized relatively recently. The
company was now undergoing a fairly rapid process of internationalization and seeking
a more global orientation. Americo seemed to have a control-oriented ethnocentric
approach to internationalization, with use of American expatriates or long-standing
‘Americanized’ Americo people in key positions, such as general manager. Control was
further enhanced by the use of ‘task forces’ to transfer the corporate message. There
was some evidence of the beginnings of attempts to aspire to a more global outlook, for
example, by the use of well-known consultants and academics who were working with
the company to encourage a less Amerocentric view.
Frenco was a major travel and tourism multinational who were seeking a more global
orientation. The Frenco corporate culture was used as a unifying mechanism across the
company, as the organization attempted to sustain a broadly geocentric approach.
Nonetheless, there was some evidence of post- or neo-colonialism in use of French expa-
triates in certain parts of the world. Attempts to sustain a ‘global’ approach were facilitated
by the movement of a cadre of ‘global’ managers across brands/countries. Many of these
managers also attended Frenco’s corporate university which attempted with some success
to encourage a more global outlook.
Swedco was a relatively small MNC with a small presence outside of Scandinavia.
Generally Swedco were seeking a control-oriented ethnocentric approach facilitated by
Swedish or Danish expatriate managers in pivotal positions in overseas units. The com-
pany seemed largely successful in their attempts to transfer the ‘Swedco Way’, the com-
pany’s core corporate culture, though there was some scepticism in the only unit in the
UK with a non-Scandinavian/Swedish manager.
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 33
greater role. Consequently organizations are likely to see a range of advantages
and disadvantages of the utilization of PCNs, HCNs or TCNs and these are con-
sidered in Table 2.2.
International organizations would usually have three broad motives for send-
ing managers abroad. The first one of those is to fill positions, when HCNs are
unavailable or difficult to train. Although in a more control-oriented ethnocentric
approach, PCNs or suitably socialized TCNs may be sent to maintain control due
to them knowing the organizational ‘rules’ and culture better, thus allowing them
to make the ‘right’ kind of decisions. Second, organizations may seek to develop
managers with long-term potential by giving them valuable international experi-
ence, which is likely to enhance their standing in the organization. Such transfers
may occur even when suitably qualified HCNs exist. Lastly, there may be attempts
to develop a more geocentric approach, whereby control is achieved by accultura-
tion, socialization and interaction among managers of different nationalities, with
the intent of creating a ‘global’ corporate culture, which de-emphasizes national
cultures, and a cadre of managers able to disseminate such an approach. The idea
would be that managers would become less ethnocentric if they were to come into
contact with a variety of cultures and different cultural perspectives.
The role of international managers in tourism and hospitality
Gliatis and Guerrier (1994) report on research conducted with a small sample
of expatriate managers. The research was based on interviews conducted in
four large international hotel companies with seven personnel specialists and
eight hotel managers (all from different countries and interestingly all male), on
assignments outside their home country. The research was carried out in the
UK and in Greece and sought to answer several key questions (Gliatis and Guerrier,
1994: 230):
? Why and how do hotel chains use international assignments for managers?
? When would they seek to fill a post with an expatriate manager and when with
a local manager?
? How is the use of expatriates changing?
? What problems do they perceive in their use of international transfers?
? What type of person is attracted to an international career?
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 34
Table 2.2 Advantages and disadvantages of using PCNs, TCNs and HCNs
Advantage Disadvantage
PCNs Familiarity with the home offices Difficulties in adapting to the foreign
goals, objectives, policies and practices language and the socio-economic,
political, cultural and legal environment
Technical and managerial competence Excessive cost of selecting, training
and maintaining expatriate managers
and their families abroad
Effective liaison and communication The host countries’ insistence on
with home-office personnel localising operations and promoting
local nationals
Easier exercise of control over the Family adjustment problems
subsidiary operation
HCNs Familiarity with the socio-economic, Difficulties in exercising effective control
political and legal environment and with over the subsidiaries operation
business practices in the host country
Lower costs incurred in hiring HCNs Communication difficulties in dealing
with home-office personnel
Provides opportunities for advancement Lack of opportunities for home
of local nationals and, therefore, country’s nationals to gain
increases motivation and commitment international and cross-cultural experience
Responsive to demands for localization
of subsidiary operation
TCNs Perhaps the best compromise between Host countries’ sensitivity with respect to
securing needed technical and nationals of specific countries
managerial expertise and adapting to a
foreign socio-economic and cultural
environment
TCNs are usually career international Local nationals are impeded in their
business managers efforts to upgrade their own ranks
and assume responsible positions in
the multinational subsidiaries
TCNs may be better informed about
the host environment than PCNs
Source: Harzing (2004a: 254) Reprinted by permission of Sage Publications Ltd from Wil-Harzing A. and
Van Ruysseveldt, J. International Human Resource Management, Copyright (Sage, 2004).
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? What do managers who follow international career paths perceive they gain
from this type of career path?
? What do they perceive as their main problems?
The main focus of this research was why expatriate managers fail, although Gliatis
and Guerrier do tangentially address wider questions on organizational strategy
towards crossing national boundaries. They suggest that companies would ordi-
narily see the rationale for expatriation as comprising three main reasons. The first
of these is to solve specific staffing problems in a particular location, for example,
a lack of suitably qualified personnel. The second is as part of a management
development process, thus managers would benefit from the exposure to a range
of countries, cultures and international issues. The final reason would be as a
process of organizational development, whereby transfers are seen as encouraging
global co-ordination, integration and commitment to the company. A further ele-
ment to this may also be more control-oriented, in the sense that organizations will
seek to integrate via the use of (usually home country) expatriate managers to
spread the co-ordinating ‘glue’ of corporate culture to ensure that organizational
practices and policies are ‘correctly’ followed. As a result of the research Gliatis
and Guerrier also added a fourth reason as suggested by the personnel specialists,
namely the use of expatriation as a tool for motivating and retaining managers
within a company. Gliatis and Guerrier found evidence of all of these strategies in
their research and also found that expatriation tended to be more appropriate for
operational roles, such as general manager, resident manager, food and beverage
manager and rooms division manager, whilst locals would ordinarily fill the posi-
tions of personnel managers, financial managers and chief engineers due to their
local expertise.
D’Annunzio-Green (1997) reporting on research within five international
tourism and hospitality organizations – representing the airline, fast food and
hotel sector – suggests that her case study organizations were largely pursuing
a geocentric or polycentric approach. Her work is useful both in its reporting of
the research but also in terms of its contextual discussion of how organiza-
tions approach international management development (IMD). An organization
which aspires to a more global outlook faces a number of issues in terms of approaches
adopted to things such as: international career pathing, organizations developing
international managers, adaptability of employees to new cultures and language
I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 35
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 36
and the effect of training and adaptation. MNCs intending to pursue a geocentric
approach must address a number of questions, these being:
? Is there a constant supply of mobile staff?
? Can they be released on time from existing positions?
? Is there a database advanced enough to manage a geocentric approach to train-
ing and development?
? Is the company willing to invest the time and money required to ensure such a
system will operate effectively?
As D’Annunzio-Green (1997: 200) suggests, ‘For organizations wishing to develop
a truly international manager, there needs to be a major transformation in mana-
gerial careers and development opportunities to enable the acquisition of the skills,
knowledge and experience needed to work in a global market place’.
Based on findings from a self-completed postal questionnaire sent to the sen-
ior human resources specialist within the organizations, D’Annunzio-Green found
that three of the organizations in her research were pursuing a geocentric
approach, with the other two being characterized respectively as polycentric/geo-
centric and geocentric to regiocentric. The questionnaire was followed up with in-
depth interviews with the HR director in three of the organizations and this allows
D’Annunzio-Green to add more detail as to why the organizations are character-
ized in such a way. For example, in a British-owned airline company, which is con-
ceptualized as shifting from an ethnocentric to a geocentric approach, a key role is
increasingly played by HCNs and TCNs and all of the 30–40 graduates taken on to
the company’s management training scheme had to undertake a number of inter-
national postings during their training period. Allied to this approach the com-
pany also had a sophisticated database to track career moves and mechanisms to
ensure all vacancies worldwide were notified to company personnel.
Similarly, an American-owned hotel MNC communicated all international
postings via a computerized personnel database. This company, also considered
geocentric and committed in the words of the company themselves to ‘“develop-
ing truly international managers”’ (ibid.: 204), selected international managers on
the basis of good performance appraisals, a minimum of 5 years with the company
and language proficiency in at least two languages. Additionally the selection cri-
teria was also based on adaptability, international background and a high level of
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 37
mobility. The common strand of a sophisticated computerized global transfer sys-
tem was also found in the final organization, a Japanese-owned hotel MNC. Again
this company was considered geocentric and as part of their IMD had a 10-year
training and development plan which culminates in a general manager’s position.
During this time the candidates, who theoretically could come from any country,
would undertake a part-time MBA and placements in at least three countries to
encourage mobility, cultural empathy and global business awareness.
In sum, Gliatis and Guerrier’s and D’Annunzio-Green’s work is useful in pointing
to the likelihood of organizations within the tourism and hospitality sector adopt-
ing different approaches to internationalization and their utilization of interna-
tional managers. In particular, the attempt by D’Annunzio-Green to add greater
detail as to what may denote a geocentric approach is useful in suggesting a range
of organizational practices and policies which appear crucial in facilitating such an
approach.
Much of what we have been discussing to date has largely been about the
manner in which MNC companies seek to develop their overall orientation and
the implications of such an approach with regard to international staffing. Beyond
this focus, there is also a need to consider the broader aspect of comparative HRM,
which is more concerned as to why certain HRM practices may differ from coun-
try to country. To begin to discuss this we should recognize the importance of the
country-of-origin of MNCs.
Country-of-origin
Ferner (1997) provides a review of the country-of-origin literature and some of the
substantive issues engendered by this work. From the relatively small body of
research examining the country-of-origin effect, Ferner believes that two impor-
tant generalizations can be extrapolated.
Review and reflect
What are some of the key skills needed to be a successful expatriate manager in the
international tourism and hospitality industry?
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 38
The first generalization is that the literature provides support for the notion
that the nationality of ownership is a significant determinant of MNC behaviour
and thus any examination of MNCs strategies should take cognizance of the
national economic and business cultures out of which they emerged. An example
of this would be the proposition that American and Japanese MNCs have in the
past tended to be more ethnocentric and reliant on expatriate managers to ensure
organizational practices and polices are ‘correctly’ followed. Therefore this ‘impe-
rial’ approach was concerned with close control over foreign subsidiaries and led
to greater formalization and centralization and a reliance on formal systems, poli-
cies and standards to manage human resources globally.
Afurther interesting aspect identified by Ferner (1997) is whether it is sensible
to characterize, as an example, differences between Japanese and British MNCs as
being due to some inherent quality of ‘Japaneseness’ or ‘Britishness’, or whether
such differences stem from other factors, such as stage of internationalization, cor-
porate structure and proportion of units represented overseas. Furthermore the
implications of national specificity would seem to preclude any real possibility of
either a literal or even figurative ‘stateless’ organization, reflecting Van Maanen
and Laurent’s (1993: 283) view that ‘All MNCs bear something of a cultural stamp
that originates in the society where the organization was first designed’ (see also
Hu, 1992). Therefore, as Ferner (1997) cogently agues even if the home country
does not provide the bulk of sales, operations and employment, in reality it is
likely to play a highly significant role in relation to locus of ownership and control,
staffing of board and senior positions, strategic decisions emanating from the
home country and also in the location of innovative activities such as research and
development. Given Ferner’s support for the notion of an MNC’s entrenched root-
edness to a national economic and business culture it is unsurprising to find him
asking the question of ‘what features do they “absorb” from the national back-
ground?’ (ibid.: 24).
In answer to that question the second generalization is that the extent of the
possible national influence on MNC behaviour is contingent upon the issues
under consideration. Consequently nationality manifests itself more in relation to
some issues than others. For example, industrial relations practices are more likely
to resemble the practices of the local environment. These considerations are also
closely related to the convergence/divergence debate, and the extent to which the
forces of convergence may be subverting national differences. At its broadest macro-
social level, convergence theory is a recognition of the influence of over-arching
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 39
trajectories and logic of capitalist development. This socio-structural argument
suggests that societies and organizations will increasingly come to resemble each
other as they accept the inevitability of universalistic tendencies in relation to tech-
nology, economic development, industrial policies, management style and HR
practices. Consequently, over time a universal type of business organization will
emerge and management practices and organizational performance would be
shaped by the ‘logic of industrialization’ and technological change, rather than
cultural or environmental variables. Within this process a key role will be played
by MNCs who act as carriers of ‘best practice’ across national boundaries.
Clearly a key role in this process is ascribed to MNCs and this raises the inter-
esting spectre of MNCs acting as forces for convergence around the practices of the
most ‘successful’ national business regimes. In essence this means that nationally
specific versions of capitalism emerge to be disseminated by the hegemonic coun-
try’s multinationals (Smith and Meiksins, 1995). There is still much support for the
notion that the US continues to be the predominant source of what are considered
‘good practice’ approaches to both general business management and, more par-
ticularly, HRM. Brewster (1995: 207), for example, argues that ‘the analyses and
prescriptions laid out in the standard management textbooks are, fundamentally,
drawn from one particular culture: that of the USA’. Guest (1990: 377) also makes
a clear connection between HRM and the ‘American Dream’:
The growth of HRM in the UK clearly owes something to the political, eco-
nomic and business climate of the 1980s and the tendency during the decade
to look to the United States as a model of good practice in all these fields.
American multinationals have been to the forefront of HRM innovation in
the UK and the leading advocates are all American.
Branine (1994) makes the cogent point that it is much more likely that non-
American managers would adopt American management styles or techniques,
whilst at the same time suggesting it is difficult to envisage American managers
adopting policies that were originally from, for example, Mexico, Fiji or Peru. The
important point then is the applicability and transferability of the putatively
American approach to management and whether there may be an enduring
American influence on any convergent tendencies if HRM is to be the new model
for managing organizations throughout the world (and see HRM in practice 2.2).
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 40
HRM in practice 2.2 American dominance
of global economy and the international
hotel industry
Many writers argue that there are three key dimensions underpinning the process of glob-
alization, these being economic, political and cultural. It is also often argued that global-
ization is, in reality, better conceptualized as Americanization. With regard to economics a
key aspect is the rise of the multinational firm. By the early twentieth century US firms were
becoming more important players in the international economy, beginning to eclipse their
established European competitors. During the Second World War and into the post-war
period, US firms were in a position to exploit, by trade and with foreign direct investment
(FDI), firstly the inadequacies and then the decline in European manufacturing capacity,
aided of course by Marshall Aid and US Government desires to create bulwarks against
communism in Europe and Asia – Pax Americana. During this time American management
methods were vigorously exported through FDI, and education and training institutions in
Europe. With regard to politics, and particularly global governance, many argue that it is
the US particularly and to a lesser extent the industrialized countries of the European Union
which drive the operations and policies of institutions such as the World Bank, International
Monetary Fund and the World Trade Organization. Finally, there appears to be a growing
passion around the world for all things American and few things reflect American culture
better than the likes of Coca-Cola, Disney and McDonald’s, who seem to embody
Americana. A number of these aspects are seen in the history of hotel internationalization,
which was initially attributed to Conrad Hilton. He sought to place his ‘little Americas’
across the globe, leading many to talk of Hilton in venerable terms as the ‘founder’ of inter-
nationalization in the hotel industry. As well as explicitly offering a challenge to commu-
nism, many of the operating standards and procedures established by Hilton and other
pioneering American hotel chains are still apparent today. This dominance can be seen with
regard to aspects of the ‘hardware’, that is the physical product; but importantly also the
‘software’, that is the management of people. This software increasingly aims to support
high quality approaches to service via aspects such as empowerment.
Source: Nickson and Warhurst (2001).
Review and reflect
Does the American dominance of the globalization process mean that we are all increasingly
‘Americanized’?
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Country-of-operation
However strong the country-of-origin effect it is likely that units of MNCs in over-
seas locations will be influenced, to a greater or lesser extent, by what Ferner (1994:
92) has termed ‘the host-country effect’. This effect is likely to be manifested in one
of two ways, namely, the ‘culturalist’ perspective and the ‘institutionalist’ per-
spective (Olie, 1995).
The importance of culture in IHRM
The ‘softer’ culturalist perspective draws attention to cultural distinctiveness in
terms of the differing values, ideas and beliefs shared by people within any given
society. These aspects will then be taken into the organizational setting and uniquely
influence individuals workplace behaviour. Tayeb (1994) suggests that the cultural-
ist perspective is important primarily due to three reasons. First, it recognizes the
differences of cultural norms, values and attitudes from one society to another, such
that peoples’ thinking is likely to be shaped by what is considered appropriate
behaviour within that society. Second, different cultural groups will behave differ-
ently under similar circumstances because of the differences in their underlying val-
ues and attitudes. Lastly, culture will play a major part in shaping social institutions,
work organizations, managerial behaviour and personnel policies.
It is important to recognize that culture remains an essentially vague and
contested concept with literally hundreds of definitions. Equally though many
have attempted to research the impact between culture and workplace behaviour,
with one of the most famous writers in this area being Geert Hofstede. Hofstede
(1980, 2001) studied 117000 IBM staff across more than 50 countries and identified
the following four basic dimensions which describe the differences of national
culture:
? Power distance: This is the extent to which inequalities among people are seen as
normal. This dimension stretches from equal relations being seen as normal to
wide inequalities being viewed as normal. Where high power distance exists
there may well be a very clear hierarchy and managers would be expected to
manage and direct subordinates. Cultures with low power distance are likely to
be more consensual, with employees expecting to be consulted in decision-
making.
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? Uncertainty avoidance: This refers to a preference for structured situations vs.
unstructured situations. This dimension runs from being comfortable with flex-
ibility and ambiguity to a need for extremely rigid and certain situations.
Cultures with high uncertainty avoidance would prefer clear rules, whilst low
uncertainty avoidance cultures would be more comfortable working with few
rules.
? Individualism: This examines whether individuals are used to acting as individ-
uals or as part of cohesive groups. This dimension ranges from collectivism to
individualism. In individualistic cultures there is likely to be a desire to work
independently. In contrast in collectivist cultures there is likely to be a greater
preference to work with others or in groups.
? Masculinity: Hofstede distinguishes between ‘hard’ or ‘masculine’ values, such
as assertiveness and competition and ‘soft’ or ‘feminine’ values of personal rela-
tions, quality of life and caring for others. In masculine cultures work is valued
as a central life interest. By comparison feminine cultures are more likely to
stress the value of social rewards.
Based on these dimensions, and a later dimension of time and whether cultures
have a long-term vs. a short-term orientation, Hofstede categorized countries into
clusters, based on the relative similarities between cultures. If we accept the idea
of stereotyping as a common way of perceiving different nationalities, Hofstede’s
work may be open to criticisms (indeed see the recent debate between Hofstede
(2002) McSweeney (2002, 2002a) and Smith (2002) on the recent publication of an
updated version of Culture’s Consequences). For example, there is much argument
as to whether cultures can really be thought of as homogenous. However, most
writers view the work of Hofstede as important, and as somewhere between a
stereotypical description of a national culture and a useful tool for discovering an
alien culture. So in that way it can be usefully used as a practical framework for
managers to understand potential cross-cultural differences in managing different
individuals or in different cultures. To conclude on Hofstede’s work, most people
would agree that the framework is helpful as a heuristic device to assist the
process of learning about a new culture. Hofstede’s findings are useful when
applied as a general model that requires interpretation of specific circumstances. It
is important that culture assessment focuses on the general make up of a nation or
culture. This can be thought of as a curve, where most people will be near the
‘norm’, but there will be people in every society who exhibit characteristics that
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are distinctly different. Therefore these ‘mainstream’ cultural traits are best con-
sidered as a tendency or describing the behaviour of the average individual, but
clearly there is the potential for other individuals to behave differently. Lastly,
Hofstede’s work is important in suggesting that true convergence in management
and organizational practices will never occur due to the varying cultural differences
outlined above.
The institutional perspective
The difficulty in operationalizing and making concrete such amorphous notions as
tradition and culture has led a variety of writers to shift the analysis more towards
social institutions, such as education, vocational training patterns and employee/
industrial relations. Ferner (1994: 93) suggests that, ‘there is more to national vari-
ation than some nebulous notion of “cultural difference”’, and as a result, attention
should also be paid to more concrete institutional factors. This point is also noted
by Tayeb (1994: 431) who recognizes that ‘The term “nation” refers not only to cul-
ture, but also to other social, economic and political institutions which have a sig-
nificant bearing on the management style of organizations located in particular
countries’. The recognition that culture should not be seen as a synonym for nation
and an omnibus variable representing a range of social, historical, political and
economic factors, lies at the heart of the institutionalist perspective. The ‘harder’
institutionalist argument is primarily concerned with structural aspects within soci-
ety and organizations, such as the division of labour and career, status and reward
structures. These features are generated by the institutions of the host country
which, as previously noted, will affect elements such as education, training and
employee/industrial relations systems. Indeed, it is often the employee/industrial
relations system which is most often cited as the least permeable aspect of a host-
country environment, as this may often be based on a state regulated legislative
framework. Hence, there is likely to be tension between activities carried out by an
MNC and the national system of employee/industrial relations in any given host
country. This is particularly apparent within countries which have strong regula-
tory frameworks, which are likely to be a source of rules to which the MNC must
comply. For example, an American MNC may ordinarily work without trade
unions but in locating in Germany may be forced to recognize and negotiate with
trade unions due to the regulatory framework (see Royle 2002 and Royle and
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 44
Towers 2002 for an interesting discussion on how McDonald’s have sought to
override regulatory mechanisms in Europe). In sum, the impact of both the culture
and institutions means that a MNC has to consider carefully what HRM policies
and practices they can transfer because as Ferner notes (1997: 33):
… not all elements [of an MNCs human resource policies] are ‘exportable’
being too rooted in native cultural assumptions; and second because to
varying degrees host countries present obstacles to the ‘import’ of elements
of foreign business systems, and colour the operation of those which are
transferred.
Recognition of all of the above variables allows for an assessment of the impact of
specific national institutional, legal and cultural frameworks, so as to be able to
answer questions about the balance between innovation and adaptation in corporate
HR policies.
MNCs and HRM policies and practices in the
tourism and hospitality industry
We have recognized that MNCs face choices in both the manner in which they
develop their overall approach to IHRM and then how this will determine their
approach to international staffing and what HR policies and practices they seek to
transfer. Of course, MNCs are likely to want to maintain and develop a degree of
consistency in their ways of managing people on a worldwide basis. Equally
though in order to be effective locally, they may also need to adapt those ways to
the specific cultural and institutional requirements of different societies. We can
now briefly assess some of the evidence of how tourism and hospitality MNCs
may be seeking to address these issues.
Nankevis and Debrah (1995) report on management practices in a selection of
hotels in Singapore and Australia to discuss common and disparate themes within
diverse national, cultural, social and labour market environments. The basic prem-
ise of Nankevis and Debrah is that the hospitality industry is increasingly looking
to HRM to enhance organizational success and competitive advantage. To test this
proposition they used a questionnaire with 35 multiple choice questions, which were
occasionally supplemented by open-ended follow-up comments for clarification
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 45
or enlargement. The questionnaire was divided into four major categories: type of
hotel; employee details; personnel management/HRM practices and guest feed-
back. There were 109 responses (89 from Australia and 20 from Singapore) from
201 questionnaires. In relation to a range of HR issues Nankevis and Debrah found
considerable differences in approaches in Singapore and Australia and such dif-
ferences were attributable to elements such as national, cultural, social, labour
market phenomenon and management styles. Nonetheless their findings did ‘also
appear to confirm the increasing globalizm of guest market requirements and
hotel management responses’ (ibid.: 512). This was particularly so in relation to
the MNC hotel companies surveyed, leading Nankevis and Debrah (1995: 511) to
suggest that, ‘Apotential consequence of [the high proportion of hotels owned by
multinationals] is the standardization of service along with increased efficiency,
productivity and thence profitability’.
Similarly, Jansen-Verbeke (1996) reports on research undertaken in hotels
(including international hotels, e.g. Hilton International) in Belgium and The
Netherlands which suggested a high level of uniformity in managerial practices.
Jansen-Verbeke utilized Hofstede’s seminal framework to assess the extent to
which cultural differences may exist between Belgian and Dutch managers. The
research consisted of a written questionnaire, comprising 45 questions asking
managers about their everyday practices in hotel management, and the sample
consisted of 64 respondents. As Jensen-Verbeke (1996: 547) notes ‘The analysis
shows that there are only a few differences in the practices of hotel managers in
Belgium and The Netherlands’. To explain this convergence Jansen-Verbeke points
to a range of factors, such as: the two countries belonging to the same cultural
region; the homogenizing effect of organizational culture, reflecting the fact that
most MNCs have a strong organizational culture; and the culture of the hotel
industry in general, particularly in terms of uniform procedures in guest contact
and an emphasis on quality of service. Of these, it is particularly noteworthy that
organizational culture and the culture of the industry seem to play such a key role
in the process of homogenization and convergence.
Review and reflect
What are some of the potential challenges facing tourism and hospitality MNCs in
attempting to transfer their HRM practices across national boundaries?
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 46
The above discussion seems to suggest that the continued growth of multinational
corporations is likely to lead in the future to greater standardization of services, as
organizations seek greater efficiency, productivity and profitability, by utilizing
the full range of ‘soft’ techniques leading to a burgeoning sector wide ‘best prac-
tice’ approach to HRM and quality service (and see also Nickson, 1999). Acounter
argument though is offered by Mwaura et al. (1998). In their research on the ITT
Sheraton Hotel China they found significant evidence of Sheraton’s corporate cul-
ture being in conflict with several aspects of Chinese culture. For example, Chinese
managers and subordinates were not prepared to accept responsibility to ensure
responsiveness to the hotel guests. Asimilar issue was also apparent in attempts to
engender a commitment to customer satisfaction via training. Many of the local
employees were reluctant to contribute to discussions in training sessions in case
they lost ‘face’. Similar results were also found by D’Annunzio-Green (2002) in her
research on the experience of expatriate managers in Russia. Here the attempts by
expatriate managers to engender and maintain high service standards were often
thwarted by the different attitudes to service of the Russian staff. Many of the staff,
particularly those over 30, still exhibited behaviours which were developed dur-
ing the previous communist-era Soviet system. Under this system Russians would
never complain about service, no matter how bad it was. Resultantly, the lack of a
customer orientation is still apparent in a large number of the staff. What the work
of Mwaura et al. and D’Annunzio-Green exemplifies is that western management
practices cannot always be transferred in the tourism and hospitality industry, due
to differing cultural and organizational working environments (and see also Lucas
et al., 2004; Zhang and Wu, 2004).
Conclusion
We noted how increasingly tourism and hospitality organizations may be operating
on an international or even global basis. It was recognized that in internationalizing
organizations face choices in their strategic disposition, for example whether they
adopt a broadly ethnocentric or polycentric approach. The overall strategic dispo-
sition of a MNC will also impact on how they develop their international staffing.
In addressing issues of this nature MNCs may seek to utilize practices only from
its home country, imitate practices typical of other countries or increasingly utilize
an amalgam of HRM practices drawn from many other companies and countries,
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 47
especially in pursuit of notions of ‘best practice’. We noted how this has led many
to talk in terms of whether there is increasing convergence in the manner in which
HRM policies and practices are developed. In this view HRM practices are ‘culture
free’ and universalistic and so the transfer of managerial practice is straightfor-
ward, particularly if that practice is considered as ‘best practice’. On the other
hand we also noted the enduring influence of host countries’ culture and institu-
tions leading many to argue for divergence. In the latter view HRM practices are
‘culture bound’ and difficult to transfer because of the primacy of differentiating
effects of national culture or the need for MNCs to respond to differing legal and
regulatory framework in a number of countries.
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Chapter 3
Organizational culture
Chapter objectives
This chapter considers the increasing importance
of organizational culture to tourism and
hospitality organizations. The objectives of this
chapter are:
? To assess debates about the manageability of
culture.
? To consider the various aspects of
organizational culture.
? To recognize the role of organizational culture in
a broader HRM strategy.
50
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ORGANI ZATI ONAL CULTURE 51
Introduction
We recognized in the previous chapter the importance of national culture and par-
ticularly the manner in which it is likely to have an impact on workplace behav-
iour. The same is also true within organizations. All organizations will have a
culture which will have an impact on the way employees behave within the organ-
ization. As we have already recognized in Chapter 1 within human resource man-
agement employees are seen as a key resource. Our core definition of HRM from
Storey talked about cultural aspects of HRM, so part of the way in which employ-
ees, as a key resource, can be managed is through the use of organizational culture
to generate commitment to the organization and its values. Thus, as Ogbonna
(1992: 80) notes, ‘the achievement of HRM objectives requires the management of
the organizational value system (culture) and this requires skilful implementation’.
Often within tourism and hospitality such values will be concerned with encour-
aging employee buy in to the customer care and service quality initiatives, which
organizations see as a form of competitive advantage in the crowded marketplace.
This process of seeking buy in from employees is likely to have a significant impact on
a range of human resource practices, such as recruitment and selection, training and
remuneration. For example, tourism and hospitality organizations may look to recruit
and select those who are considered to ‘fit’ in with the culture. However, whilst many
organizations and managers within the tourism and hospitality industry now see the
management of organizational culture as a potential source of competitive advantage,
there are others who caution against the overly optimistic claims made for organi-
zational culture. Recognizing these competing views on organizational culture this
chapter will aim to offer a balanced assessment of the place of organizational culture
within a broader human resource strategy. Specifically, in examining organizational
culture there are three key questions that need to be addressed:
1 What is organizational culture?
2 How can we study it?
3 What role does organizational culture play in organizational success?
In search of a definition
Before we begin to move towards a definition it is important initially to recog-
nize debates about the terminology employed to describe the manner in which
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organizations attempt to use culture as a device to create integration and cohesion
across the organization. Central to this debate is the key question of the manageabil-
ity or otherwise of culture (Legge, 1994). Commonly in books or articles the terms
organizational and corporate culture may be used interchangeably. Legge (1994)
cautions against this uncritical use of the two terms. For example, she argues that
‘in using the term “corporate” culture, many writers seem to be imputing a culture
created by senior management for the lower orders to swallow’ (p. 407). In this view
‘corporate’ culture is something an organization has. Consequently, it can clearly
be managed for the benefit of the organization and its members. On the other
hand, the use of the term organizational culture reflects the manner in which cul-
ture emerges from social interaction amongst organizational members; something
that an organization is. In the latter view culture may be difficult to manipulate,
change or manage. Given some of the claims that are made about the link between
organizational or corporate culture and organizational success this is an important
caveat from Legge and one that should be borne in mind throughout the chapter.
Notwithstanding debates about whether the preferred terminology should be
organizational or corporate culture, we should attempt to define the concept.
Brown (1998: 7–8) recognizes the multiplicity of definitions of organizational cul-
ture and the differing intellectual traditions that they come from. Based on these
various definitions Brown (1998: 9) offers his own: ‘Organizational culture refers
to the pattern of beliefs, values, and learned ways of coping with experience that
have developed during the course of an organization’s history, and which tend to
be manifested in its material arrangements and in the behaviour of its members’.
For many this can be succinctly summarized as, ‘The way we do things around
here’ (Deal and Kennedy, 1988: 4). As we noted earlier all organizations have their
own unique culture and in recent years attention has focused on the manner in
which organizations can potentially use culture to unlock the commitment and
enthusiasm of employees. This process of unlocking commitment and enthusiasm
is by no means straightforward or uncontested (Thompson and McHugh, 2001).
For example, we should be aware of the notions of sub-cultures, such that all organ-
izational members might not subscribe to the organizational vision. Recognition
of the potentially contested nature of organizational culture is important because
it points to the manner in which there may be a disjuncture between the rhetoric
and reality of organizational culture. Brown (1998) expresses this point as the
espoused culture and the culture in practice. The former may be the positive view
that is presented for public consumption, whilst the latter may allow for a more
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critical reading of any given organizational culture and to further appreciate this
point the chapter now considers competing views of organizational culture.
Competing views on organizational culture
The discussion above points to the debate about whether culture is, in fact, man-
ageable and to recognize some of the competing claims made about culture we
should acknowledge the useful work of Ogbonna and Harris (2002). In reviewing
organizational culture they attempt to categorize the range of work into three
broad labels, ‘the optimists’, ‘the pessimists’ and ‘the realists’.
Optimists
Akey aspect of the optimists position is that culture can be used as a mechanism to
facilitate organizational unity and cohesion. Thus, ‘the key works of key “cultural
optimists” show that this perspective not only assumes the existence of unitary cul-
tures in organizations but it also implies that cultural control by top management is
possible and desirable’ (p. 35). Indeed, Ogbonna and Harris suggest that in recog-
nizing the manageability of culture optimists, ‘generally argue that those organiza-
tions that fail to control their cultures will be missing an opportunity to harness
their human resources’ (p. 35). The optimists view relies on a lot of assumptions,
not least that the interests of senior managers are shared by others in the organiza-
tional hierarchy. This type of thinking was particularly prevalent in much of the
research and writing about organizational culture in the 1970s and 1980s, most
obviously exemplified by the excellence genre, or what Thompson and McHugh
(2001) refer to as the ‘corporate culture merchants’, such as Peters and Waterman
(1982). Optimists also argue that there is a potentially positive relationship between
organizational culture and business performance (and see HRM in practice 3.1).
Pessimists
Ogbonna and Harris note that academics tend to predominate in this group and often
approach the issue from largely theoretical perspectives. In that sense pessimists
seek to develop the ‘explanatory power of the culture concept rather than in
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HRM in practice 3.1 Strong culture at the
Regent Hotel
Kemp and Dwyer (2001) reflect an optimistic view of organizational culture in their
research undertaken in the Regent Hotel, Sydney. The starting point of Kemp and Dwyer’s
research is that culture is viewed as an integrating, unifying phenomenon, shared by all
organizational members. In this manner culture can be used to integrate and bind orga-
nizational members; it becomes a normative ‘glue’. The authors believe that a ‘strong’
culture is an important enabling force in strategy formulation and ultimately is a major
aspect of enhancing organizational performance. Drawing on interviews with 45 man-
agers and employees of the hotel, Kemp and Dwyer recognize a variety of ways in which
cultural aspects are integral to the development of HRM practices. For example, they
suggest that within the hotel control is primarily through attempts to ensure that the
employees offer quality service and exceed guests’ expectations. Thus, ‘Behavioural
control is exerted through hotel training. Staff are taught how to enjoy their job and that
they should greet guests at all times with a smile. In the attitude workshop staff are told
that “smiles are what count”. These smiles need to be as crisp as their daily dry-cleaned
uniforms’ (p. 87). Even before the extensive attitudinal and behavioural training though
control is exerted through recruiting the ‘right’ kind of people, who identify with the cor-
porate objectives. It is also suggested that control is not too tight, but rather the Regent
Way corporate culture encourages the ‘right’ kind of behaviour. If employees exhibit the
right kind of behaviour this is recognized in formal celebrations of cultural values, often
in the form of ceremonies which celebrate an aspect of the organizational culture. To
illustrate this point Kemp and Dwyer recognize how the Regent Hotel rewards staff who
exceed expectations in some way with a formal presentation in front of their peers, argu-
ing that, ‘These ceremonies are extremely motivating and serve to ensure a repeat of the
superior performance by the staff member’ (p. 84).
Culture, it is suggested, permeates every aspect of operations at the Regent Hotel,
shaping the employees’ responses to guests and also management’s responses to their
most important asset, their human resources. According to Kemp and Dwyer, the Regent
Hotel exemplifies a strong culture in which top management set the game plan and then
individuals throughout the organizational hierarchy have responsibility for operationaliz-
ing the plan. The cultural approach of the Regent Hotel has resulted in breaking down
the barriers between the thinker and doers. It is suggested that staff at the Hotel share a
strong awareness of the corporate mission and philosophy. They all know that the
‘Regent Way’ encourages ‘Regent People’ to be innovative and creative.
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identifying its practical utility for managers of organizations’ (p. 36). Thus, and
arguably in response to the excellence genre, much of the research and theorizing
from the 1980s onwards has frequently questioned the extent to which organiza-
tions can manage culture successfully. The main thrust of the pessimists critique is
that such a complex issue as culture has been overly simplified by the optimists; ‘it
is argued that that culture is located at the deepest level of human consciousness,
of which neither researchers nor managers have sufficient knowledge to influence’
(p. 36). A second strand to the critique is the unitary assumptions that underpin
the optimists position on culture. Pessimists would point to the potential for con-
flict and contradiction in organizations which may be at odds with what the lead-
ers and managers in an organization think (see HRM in practice 3.2).
Realists
The last category suggested by Ogbonna and Harris are the realists. Increasingly
many researchers and writers are seeking a middle-way between the optimists and
the pessimists and this has led to the emergence of a realist research agenda. Realists
recognize that potentially culture can be changed. Equally, though, they eschew the
HRM in practice 3.2 Culture as an
Orwellian mechanism
One of the more pejorative critiques of ‘corporate culturism’ is that offered by Wilmott
(1993). Wilmott talks about the Orwellian nature of corporate culture, with its nascent
totalitarianism and 1984-style doublethink which attempts to create ‘governance of the
employee’s soul’. He suggests that corporate culture is largely interested in creating a mono-
culture where alternative views or competing cultures are not tolerated. By excluding those
considered as inappropriate in the recruitment and selection process and eliminating any
alternative values by training, corporate culture aims to strengthen core organizational values.
Any attempt to challenge the prevailing culture is considered a ‘crime against the culture’.
Consequently corporate culture is ‘a totalitarian remedy for the resolution of indeterminacy
and ambiguity: thought control through uniform definition of meaning … In Orwell’s
Oceania, “freedom is slavery” and “ignorance is strength”. In the world of corporate culture,
“slavery is freedom” and “strength is ignorance”’ (p. 527, emphasis in original).
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idea that this process will always be controlled by top management. Consequently,
‘realists are neither in support nor against the management of organizational culture.
Rather, they advocate fuller explorations of the application of the concept, in order to
develop greater understanding of the dynamics of cultural change’ (p. 37). For exam-
ple, Ogbonna and Harris note how culture change is more likely to occur during the
formation of the organization, periods of crisis or during leadership turnover. In sum,
the realist position, which is advocated by Ogbonna and Harris, is one which aims to
merge theoretical rigour with contributions to the practicality of how organizational
culture may be usefully used within a specific organizational context.
How can we study organizational culture?
Brown (1998) suggests that a number of different aspects or elements of culture
have been identified and all of these various aspects are useful in attempts to study
organizational culture:
? material objects;
? corporate architecture and corporate identity;
? symbols;
? language;
? metaphors;
? stories;
? myths;
? heroes;
? ceremonies, rites and rituals;
? norms of behaviour;
? values, beliefs and attitudes;
? basic assumptions;
? ethical codes;
? history.
Review and reflect
Using an organization with which you are familiar consider the extent to which you would
adopt either the optimistic, pessimistic or the realistic perspective to describe its culture.
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As Brown recognizes there may be a degree of overlap between the above elem-
ents, a point we return to below. Another key theme running through these var-
ious aspects of an organization’s culture is the extent to which they may be
manifest or visible. Schein (1985), for example, offers a well-known model which
describes three levels of cultural phenomenon in organizations: visible manifest-
ations, values and the deepest level of basic underlying assumptions. The first level
consists of artefacts and creations that construct the physical and social environ-
ment of the organization. This level is the most superficial manifestation of culture
and includes things like corporate logos, dress codes and written and spoken lan-
guage used in the organization. The second level is concerned with values, beliefs
and attitudes, which become prominent in the manner in which individual orga-
nizational members justify their actions and behaviour. As Lashley and Lee-Ross
(2003: 154) note ‘The extent to which members hold these core values and norms
as unquestionable determines whether the organizational culture is “strong” or
“weak”’ . The last level is the most fundamental and relates to basic and tacit
assumptions which impact on how organizational members perceive, think and
feel. Schein (1985: 18) suggests that ‘Basic assumptions … have become so taken
for granted that one finds little variation within a cultural unit. In fact, if a basic
assumption is strongly held in a group, members would find behaviour based
on any other premise inconceivable’. To further consider the manifest and not so
manifest levels of culture the chapter now returns to some of Brown’s elements of
culture.
Material objects, corporate architecture and corporate
identity and symbols
These aspects of an organization’s culture provide a visible and manifest way in
which it can be assessed. For example, mission statements are an obvious manifesta-
tion of material objects within organizations. Sufi and Lyons (2003) note how mission
statements are now considered an important part of any company’s strategic plan-
ning processes. The same authors note how mission statements can act as an impor-
tant tool for tourism and hospitality organizations to communicate to organizational
members and those outside the organization, such as customers and suppliers.
Agood mission statement should have some of the following components (Sufi and
Lyons, 2003: 258): concern for the customer, purpose, identity/image, differentiation
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factors, corporate values, products, markets, concern for survival, growth, profitabil-
ity, company philosophy and employee and social concern.
Beyond mission statements service organizations are also increasingly aware
of how they portray their corporate image, both in terms of attempts to offer aes-
thetically pleasing ‘hardware’ and ‘software’ (Nickson et al., 2001). Aesthetics are
a sensory experience through which objects appeal in a distinctive way. This
appeal does not necessarily have to be beautiful but rather and more simply
expressive. Materializing the concept of a company requires the transformation of
an abstractly defined identity into the adoption of a style; in practice, the produc-
tion of an aesthetic experience. Aesthetics have always been important to com-
panies. Companies past and present use aesthetics to express corporate identity.
These expressive forms are most obvious in the ‘hardware’ of organizations, such
as marketing material (internal and external), product design and the physical
environment of workspaces/offices (Witz et al., 2003). Three points are worth not-
ing with regard to the expression of corporate identity.
Firstly, as symbols and artefacts, these aesthetics are intended to influence the
perception of people as either customers or clients: organizations ‘use these sym-
bols in a vivid, dramatic and exciting way, because they know that symbols have
power to affect the way people feel’. Secondly, they are intended to add value to the
company. ‘Generally speaking, when companies use identity expressed through
design, they use it as a commercial tool; their purpose is to make greater profit out
of what they do in the short term’. Thirdly, in highly competitive markets with lit-
tle to differentiate most goods and services, aesthetics contribute to organizational
distinctiveness: ‘intangible, emotional. The name and visual style of an organiza-
tion are sometimes the most important factors in making it appear unique’ (Olins,
1991: 53, 71 & 75). Here we could think of McDonald’s Golden Arch, for example
(and see also Bryman, 2004 for a more general discussion of theming in other
tourism and hospitality settings).
With regard to ‘software’ service organizations are becoming increasingly con-
cerned to regulate the appearance of their staff, through the use of uniforms, dress
codes and appearance standards. Rafaeli (1993), for example, considers how the
dress and behaviour of customer contact employees’ shapes customer perceptions
of service quality. As she suggests:
… the thrust of organizational management of employees’ dress is that the
appearance of employees communicates something about the organization.
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The assumption is that what employees wear while at work, and how they
appear when interacting with customers, can influence customers’ feelings
about the organization and the service that it provides (p. 182).
Disney, for example, has a 36 page cast members’ appearance guide detailing length
and style of hair and the colour and quantity of cosmetics (Henkoff, 1994; and see
also Bryman, 2004). Some of the implications arising from how organizations are
increasingly seeking competitive advantage via employees appearance or their
‘aesthetic labour’ (Nickson et al., 2001) are further considered in Chapter 5.
Language and metaphors
Bryman (2004) recognizes that increasingly service organizations aim to create
performativity in the service encounter through the use of performative labour.
Such labour is described as ‘the rendering of work by managements and employ-
ees alike as akin to a theatrical performance in which the workplace is construed
as similar to a stage’ (p. 103). The use of a dramaturgical or theatrical metaphor is
one that has often been used with regard to the manner in which service employ-
ees perform emotional labour (Hochschild, 1983). As Burns (1997: 240) notes the
emotional demands made of front-line tourism and hospitality employees is that
they should ‘constantly be in a positive, joyful and even playful mood’. Brown
(1998) recognizes how language and metaphors aim to construct a common
understanding in organizations so that abstractions such as ‘good service’, ‘high
quality’ and ‘excellence’ are made meaningful. HRM in practice 3.3 and 3.4 offer
examples of how two organizations respectively use language and metaphor,
explicitly drawing on notions of performativity, to create the right type of behav-
iour in their front-line employees.
Review and reflect
To what extent should tourism and hospitality organizations be able to use aesthetic and
emotional labour to exert control over the manner in which employees behave? What
are the likely challenges of using these types of cultural controls?
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Stories, myths, heroes and history
Deal and Kennedy (1999) note how stories are an important part of an organiza-
tion’s culture due to their ability to transmit cultural values. Corporate stories will
often focus on exemplifying core values in the organization, often with recourse to
the achievements and daring do of cultural heroes, such as the founder of an
organization. In an earlier work Deal and Kennedy (1988) suggested that these
heroes personify the organizational values and epitomize the strength of the
organization. In becoming a ‘John Wayne in pinstripes’ heroic figures in organiza-
tions’ become role models for employees to follow. For example, Herb Kelleher
co-founder and long-time chief executive officer (CEO) of Southwest Airlines is well
known for his attempts to generate a sense of fun in the workplace. Known as the
HRM in practice 3.3 The use of language
in Disney
Everyday terms Disney speak
HR department Casting office
HR manager Casting rep
Theme park visitor customer Guest
Employee Cast member
Front-line employee Host or hostess
Public areas Onstage
Restricted areas Backstage
Theme park ride or show Attraction
Hiring for a job Casting
Job Role
Foreman Lead
Uniform Costume
Job interview Audition
Accident Incident
Queue/line Pre-entertainment area
Attraction designer Imaginer
Talking robot Audio-animatronic figure
Derived from Bryman (2004) IRS (2003).
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‘High Priest of Ha-Ha’ Kelleher was integral in creating a corporate culture premised
on fun. He believed in encouraging Southwest’s flight attendants to joke and kid with
passengers. Sunoo (1995) suggests that this strategy to hire the best people, treat them
with respect, and give them the freedom to make decisions and to have fun just being
themselves has created some of the most loyal employees in the airline industry.
Indeed, Bearden (2001) notes that in the immediate aftermath of 9/11 each of South-
west’s 32000 employees agreed to give back some of their pay to ensure company
stability in a turbulent business environment (and see also HRM in practice 3.5).
Norms of behaviour, values, beliefs and attitudes, and basic assumptions
Our earlier discussion of aspects such as performative labour and the mechanisms
utilized by tourism and hospitality organizations to engender the right kind of
emotional labour points to the manner in which they strive to achieve appropriate
HRM in practice 3.4 Warm fuzzies and cold
pricklies: the use of metaphor in Pizza Hut
Bate (1995: 44–45) notes that during the 1980s and early 1990s Pizza Hut’s employee
induction programme made use of a booklet called Feelings. The booklet attempted to
set out what employees should feel and particularly how they should display warm feel-
ings, or what were termed ‘warm fuzzies’, during their work. Negative feelings were
characterized as ‘cold pricklies’. These two feelings were anthropomorphized into two
cartoon characters: a malevolent, spiky haired, spiky-bearded dwarf (cold prickly) and an
appealing, round-eyed cuddly powder puff creature (warm fuzzy). Warm fuzzies were
shown helping old ladies and giving out ‘positive strokes’ to everybody. In contrast, cold
pricklies were seen getting wet and angry under black storm clouds and showing hostil-
ity to customers. The coldest of cold pricklies was the Big Fat Zero, who kept customers
waiting, refused to smile and ignored people altogether. Warm fuzzies were represented
in the booklet booting out cold pricklies and smiling no matter how hectic things
became. In attempting to create the right kind of emotional labour the company aimed
to ensure Pizza Hut employees saw themselves as warm fuzzies and act accordingly by
demonstrating the right kind of positive feelings towards customers, even when they did
not necessarily feel like doing so.
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behaviour. Many tourism and hospitality organizations may well recognize that
attempting to connect with their employees to generate a more fundamental level
of engagement in the appropriate values, beliefs and attitudes or even basic assump-
tions in the organizations, may be doomed to failure. In this sense the ability of
HRM in practice 3.5 Stories and myths from
some of the great hospitality entrepreneurs
Nickson (1997) argues for the importance of appreciating the need for an understanding
of history in reviewing the auto/biographies of Charles Forte, Conrad Hilton, Kemmons
Wilson (the founder of Holiday Inn) and Bill Marriott (senior). Nickson notes the manner
in which the stories and myths surrounding these famous hospitality entrepreneurs play
an integral part in creating a corporate aura and values. For example, the three American
‘giants’ are suggested to exemplify the American Dream, which sees America as a land
of opportunity, where individuals by hard work and self-improvement can achieve great
success. A key element of this is respect for ‘rugged individualism’ (Guest, 1990: 390)
and a willingness of individuals to grasp their opportunities by pushing back the fron-
tiers, both literally and metaphorically. In a literal sense, Hilton was brought up in the
‘half civilized country’ of New Mexico, where his father nearly became a victim of his
own pioneering spirit as he was only one of two men to survive an attack by Apache
Indians, an attack that left five others dead. The young Bill Marriott also demonstrates his
frontier spirit on a camping trip in killing a deadly snake – naturally ‘the biggest rattler
anyone could remember’ (O’Brien, 1977: 52–53) and two menacing brown bears. In a
metaphorical sense some of this frontier spirit is evidenced in the notion of the self-
reliant small businessman who sets up their own business and makes it successful. A
common theme which in the accounts is the humble beginnings of the subjects’ organ-
izations. Hilton, for example, famously described his first hotel, the Mobley, purchased in
Cisco, Texas in 1919 as ‘a cross between a flop house and a gold mine’ (Hilton, 1957:
109). Bill Marriott’s early business career began with an ‘A and W’ root beer franchise
which he acquired in 1927 and Charles Forte’s move into business came with the open-
ing of a milk bar in 1934. From such beginnings the nascent organizations quickly flour-
ished and many of the operating procedures and management styles described in those
early years can to some extent still be observed in the contemporary hospitality industry.
For example, Hilton is credited with being the ‘founder’ of internationalization in the
hotel sector and many aspects of the present Marriott philosophy, such as empower-
ment, can be seen to trace their history to Bill Marriott senior’s way of doing business.
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tourism and hospitality organizations to achieve cultural change at the deepest
levels of basic assumptions may well be impossible. Of course, employers will use
a variety of mechanisms to create the right kind of behaviour. Some of these may
be cultural mechanisms as described above; others may simply be about the use of
other means of control. For example, whilst some might claim that the ‘strong’ cul-
ture at McDonald’s is largely created by the prevailing organizational culture,
more critical authors would point to aspects such as deskilling and the use of non-
human technology (Ritzer, 2004). Even cultural mechanisms may be underpinned
by more rigid control mechanisms. Ogbonna and Wilkinson (1990) report the
example of one supermarket that as part of a culture change programme encour-
aged employees to smile more when engaging with customers. However, the com-
pany went one step further in introducing ‘smile supervisors’ who were tasked to
assess whether employee smiles were genuine. If smiles were felt not to be genu-
ine employees were reprimanded by the smile supervisors. Needless to say this
approach created a good deal of employee resentment. In reality, most organiza-
tions will simply settle for the right kind of outward behaviour being manifested
by their employees, without recourse to smile supervisors, even if such a perform-
ance is simply a manifestation of resigned behavioural compliance.
Clearly, then, there are a number of functions that organizational culture will
play. In this normative view of corporate culture, it attempts to foster social cohe-
sion, so that it becomes the ‘cement’ or ‘glue’ that binds an organization together
so it may offer co-ordination and control, reduction of uncertainty, a means to
motivate staff and ultimately competitive advantage. Throughout this chapter
though we have alluded to some of the potential difficulties in sustaining this nor-
mative view of culture. Beyond this point there is also a need to recognize the
debate about whether there really is any evidence to support a relationship
between organizational culture and performance, particularly whether culture can
enhance the effectiveness of an organization’s performance. Alvesson (2002: 53–54)
suggests that there are four views on the relationship between organizational
culture and performance:
1 The so-called strong culture thesis. In this view employees are assumed to be incul-
cated into a strong organizational culture and resultantly demonstrate a high
level of commitment to the organization and its values. Within the strong cul-
ture thesis it is assumed that the strength of the culture will be directly correl-
ated with the level of profits in a company.
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2 A reverse relationship between culture and performance. In this view it is suggested
that high-performance leads to the creation of a strong corporate culture. Orga-
nizational success creates common orientations, beliefs and values and an accept-
ance of the ‘way of doing things’.
3 Acontingent view of culture. In particular circumstances or conditions a particular
type of culture is appropriate or even necessary and is likely to contribute to
efficiency.
4 The need for adaptive cultures. Cultures that are able to respond to changing
circumstances or a change in the business environment are the key to good
performance (and see HRM in practice 3.6).
Ultimately in considering the relationship between culture and performance
Alvesson (2002: 54) notes that, ‘the relatively few systematic studies on the culture-
performance link lead us to conclude that none of these four ideas have received
much empirical support’. For example, much of the earlier work on culture, as
exemplified by Peters and Waterman (1982), was often underpinned by support for
the strong culture thesis. Thompson and McHugh (2001), amongst others, question
the evidence offered by Peters and Waterman and others supporting the strong
culture-enhanced performance thesis. As they suggest, ‘The tenuous link between
cultures, excellence and performance turned out to be highly fragile’ (2001: 199).
Generally, then, the case for whether a ‘strong’ organizational or corporate culture
is integral to the success of an organization remains unclear. More broadly, whilst
HRM in practice 3.6 A failure to adapt?
The failure of a culture to adapt may arguably partially explain the inability of Forte to
resist the hostile takeover mounted by the Granada organization. Nickson (1997) notes
the important role played by Lord Forte, the founder of the company, and how his influ-
ence was pervasive on the culture. In time, Lord Forte was succeeded by his son, Rocco
Forte, though many foresaw the difficulties of succeeding Lord Forte. Lashley and
Lee-Ross (2003) note how the strong power/role culture created in the Forte group was
anachronistic and uncompetitive and left the company vulnerable to the takeover.
Several pieces written during the height of the take-over battle seemed to question the
extent to which Rocco Forte could carry on his father’s legacy, especially if the previously
strong culture was creating rigidity and group think in the organization.
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it might seem intuitively true that, for example, adaptive cultures are self-evidently
superior, again the evidence seems sparse, as far as Alvesson is concerned.
Organizational culture and HRM: a reprise
Throughout this chapter, we have considered the relationship between cultural
mechanisms and HRM strategies. Equally, we have also recognized debates about
the manageability of culture or whether organizational culture can be causally related
to enhanced effectiveness or performance in organizations. Ultimately, as we have
already recognized there are no easy answers to these issues and there is a need
to recognize the many competing claims or views about the nature of organiza-
tional culture. That said, Ogbonna and Harris’ espousal of the realist position is
one that attempts to reconcile some of these debates. If we accept the realist pos-
ition then there may be instances were culture may be managed or changed in sup-
port of organizational aims. As a corollary attempts to manage culture in support
of organizational aims will mean the adoption of certain HRM practices. Specifically,
we recognized that attempts to sustain a degree of cohesion through cultural
mechanisms is likely to mean that organizations will look to recruit those individuals
who are deemed to ‘fit’ in with the prevailing culture. Once recruited employees will
then undergo an intense period of induction and socialization to be fully inculcated
into the organizational culture. This process of inculcation is further reinforced
through training and development activities, which as we noted within hospital-
ity and tourism, will often be directed towards enhancing quality service. Lastly,
organizations may chose to reward those who are seen to have internalized the
values of the organization through enhanced financial rewards, such as those
described in Kemp and Dwyer’s case study of the Regent Hotel.
Review and reflect
What are some of the likely challenges facing tourism and hospitality organizations who
are seeking to use organizational culture as a unifying device as part of their broader
HRM strategy?
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 66
That said, there is a need to consider some of the potential contradictions and
dilemmas in managing culture. Some of the contradictions and dilemmas may well
be posed by the sectoral context in which an organization operates. For example,
with regard to tourism and hospitality, Ogbonna and Harris (2002: 39–40) note how:
… the tensions between the key employment features of the industry – such
as labour flexibility, low pay, poor terms and conditions, casualization and
feminization – and the traditional ‘high commitment’ objectives of culture
management programmes make this an important industry for the study of
organizational culture.
Recognizing this point they go on to recognize some of the limitations in the extent
and manner of cultural intervention in the case study companies reported in their
study. For example, Ogbonna and Harris remain sceptical of the ability of tourism
and hospitality organizations to achieve cultural change at the deepest levels of
basic assumptions across the organizational hierarchy. The ability to achieve
deeper levels of cultural transformation may be problematic due to working con-
ditions and terms of employment, such as unsocial working hours and low pay.
Equally, the managers interviewed in Ogbonna and Harris’ case study organiza-
tions recognized the difficulties of gaining significant commitment from periph-
eral workers (and see also Figure 3.1).
Tight ‘fit’ between organization
and individual
Labour shortages, competition
for labour, ad-hoc recruitment
and selection
Quality and service
High trust and commitment Surveillance, tight control, low pay
Strong internal labour market High labour turnover, high
percentage of part-time employees
Adapted from Ogbonna (1992).
Difficult customers
Ideal HRM goals Contradictions and dilemmas
Figure 3.1 HRM and culture: contradictions and dilemmas
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ORGANI ZATI ONAL CULTURE 67
Ultimately, in considering the implications for practitioners Ogbonna and
Harris suggest that their findings point to how culture can best be managed. Crucial
to this point is the need to recognize that a differentiated approach is likely to work
best, reflecting the core and peripheral workforce in the tourism and hospitality
industry. In that sense core staff, who are long serving and exposed to extensive and
intensive culture programmes, may well be inculcated to a large degree into the
organization’s culture. However, for peripheral workers, ‘practitioners may well
focus their attention on ensuring behavioural compliance and appropriate emo-
tional displays’ (p. 50). Clearly then this points to the need for organizations to con-
sider differentiated, complex and sensitive change programmes as these are more
likely to be successful in gaining buy in to the culture from organizational members.
Conclusion
Alvesson (2002) suggests that too much organizational culture thinking has been
grounded in assumptions about the potentially positive consequences of culture, a
trend which arguably emerged with the panacean nature of the excellence genre,
which captured the managerial imagination when it first emerged in the early
1980s. Over time more reflective and critical accounts have sought to temper some
of this initial enthusiasm for the role that culture can play within the organization.
Ogbonna and Harris’ characterization of ‘optimists’, ‘pessimists’ and ‘realists’
neatly captures the evolving nature of the debate about organizational culture and
its ability to enhance commitment amongst organizational members. In adopting
a realist position Ogbonna and Harris attempt to recognize that culture can be
managed, though the extent to which this process may be successful remains con-
tingent. The nature of the industry, organization, occupation, employment status
within the organization and many other things beside are all likely to impact on
the extent to which organizational members ultimately immerse themselves in
the basic assumptions of the organization, or simply manifest resigned behavioural
compliance.
References and further reading
Alvesson, M. (2002) Understanding Organizational Culture, Sage.
Bate, P. (1995) Strategies for Cultural Change, Butterworth-Heinemann.
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Bearden, T. (2001) ‘High flyer’, PBS News, November 28, http://www.pbs.org/newshour/bb/transportation/
july-dec01/southerwest_11-28.html (accessed 8 August 2005).
Brown, A. (1998) Organizational Culture, Pitman, 2nd edition.
Bryman, A. (2004) The Disneyization of Society, Sage.
Burns, P. (1997) ‘Hard-skills, soft-skills: undervaluing hospitality’s “service with a smile”’ , Progress in
Tourism and Hospitality Research, 3, 239–248.
Deal, T. and Kennedy, A. (1988) Corporate Cultures: The Rites and Rituals of Corporate Culture, Penguin.
Deal, T. and Kennedy, A. (1999) The New Corporate Cultures: Revitalizing the Workplace after Downsizing,
Mergers, and Reengineering, Perseus.
Guest, D. E. (1990) ‘Human resource management and the American Dream’, Journal of Management
Studies, 27, 4, 378–397.
Henkoff, R. (1994) ‘Finding and keeping the best service workers’, Fortune, 3 October, 52–58.
Hilton, C. N. (1957) Be My Guest. Englewood Cliffs, New Jersey: Prentice-Hall.
Hochschild, A. (1983) The Managed Heart, University of California Press.
Industrial Relations Services (2003) ‘The mouse trap: company culture at Disney World’, IRS Employment
Review, 783, 3 October, 21–23.
Kemp, S. and Dwyer, L. (2001) ‘An examination of organizational culture – the Regent Hotel, Sydney’,
International Journal of Hospitality Management, 20, 77–93.
Lashley, C. and Lee-Ross, D. (2003) Organization Behaviour for Leisure Services, Butterworth-Heinemann.
Legge, K. (1994) ‘Managing culture: fact or fiction’, in K. Sisson (ed.) Personnel Management: A
Comprehensive Guide to Theory and Practice in Britain, Blackwell, 397–433.
Nickson, D. (1997) ‘Colorful stories’ or historical insight? A review of the auto/biographies of Charles Forte,
Conrad Hilton, J.W. Marriott and Kemmons Wilson, Journal of Hospitality and Tourism Research, 21(1),
179–192.
Nickson, D., Warhurst, C., Witz, A. and Cullen, A.M. (2001) ‘The importance of being aesthetic: work,
employment and service organization’, in A. Sturdy, I. Grugulis, and H. Wilmott (eds.) Customer Service –
Empowerment and Entrapment, Palgrave, 170–190.
O’Brien, R. (1977) Marriott: The J Willard Marriott Story, Desert Book Company.
Ogbonna, E. (1992) ‘Organizational culture and human resource management’, in P. Blyton and P. Turnbull
(eds.) Reassessing Human Resource Management, Sage, 74–96.
Ogbonna, E. and Harris, L. (2002) ‘Managing organizational culture: insights from the hospitality industry’,
Human Resource Management Journal, 12(1), 33–53.
Ogbonna, E. and Wilkinson, B. (1990) ‘Corporate strategy and corporate culture: the view from the check
out’, Personnel Review, 19(4), 9–15.
Olins, W. (1991). Corporate Identity, Thames and Hudson.
Peters, T. and Waterman, R. (1982) In Search of Excellence: Lessons from America’s Best-run Companies,
Harper and Row.
Rafaeli, A. (1993) ‘Dress and behaviour of customer contact employees: a framework for analysis’, Services
Marketing and Management, 2, 175–211.
Ritzer, G. (2004) The McDonaldization of Society, Pine Forge Press, Revised New Century Edition.
Schein, E. (1985) Organizational Culture and Leadership, Jossey-Bass Publishers.
Sufi, T. and Lyons, H. (2003) ‘Mission statements exposed’, International Journal of Contemporary
Hospitality Management, 15(5), 255–262.
Sunoo, B. (1995) ‘How fun flies at Soutwest Airlines’, Personnel Journal, June, 62–73.
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Thompson, P. and McHugh, D. (2001) Work Organizations: A Critical Introduction, MacMillan Press,
3rd edition.
Van Maanen, J. (1990) ‘The smile factory: work at Disneyland’, in P. Frost, L. Moore, M. Louis, C. Lundberg
and J. Martin (eds.) Reframing Organizational Culture, Sage Publications, 58–76.
Wilmott, H. (1993) ‘Strength is ignorance; slavery is freedom: managing culture in modern organizations’,
Journal of Management Studies, 30(4), 515–552.
Witz, A., Warhurst C. and Nickson, D. (2003) ‘The labour of aesthetics and the aesthetics of organization’,
Organization, 10(1), 33–54.
Woods, R.H. (1989) ‘More alike than different: the culture of the restaurant industry’, Cornell Hotel and
Restaurant Administration Quarterly, 30(2), 82–98.
Websites
There are a number of useful weblinks and case studies which can be found at http:/ //www.new-
paradigm.co.uk/Culture.htm
Southwest Airlines has a unique culture which stresses the fun nature of the business and details can be found
at http:///www.southwest.com/about_swa/
Edward de Bono and Robert Heller are well know management gurus and they have some interesting thoughts
on organizational culture which can be found at http:/ //www.thinkingmanagers.com/business-manage-
ment/corporate-culture.php
ORGANI ZATI ONAL CULTURE 69
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Chapter 4
Labour markets
Chapter objectives
This chapter considers the nature of labour
markets in the tourism and hospitality industry.
Specifically, the objectives are:
? To appreciate the different levels of analysis in
understanding labour markets.
? To understand the particular sectoral character-
istics that determine the tourism and hospitality
labour market.
? To consider debates about the use of flexible
labour strategies within tourism and hospitality
organizations.
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Introduction
We should start by asking a key question; what do we mean when we talk about
labour markets? At any one time people will be trying to either change their job or
acquire a job and employers will be looking for employees, and this means that, in
principle, in the external labour market all workers are assumed to be competing for
all the jobs all the time. In reality, of course, this may not be the case and we can appre-
ciate this by disaggregating different types of labour markets. Within this process
there is also a need to have some awareness of a range of macro-economic issues,
political and social factors and their impact on the external and internal labour
markets, which will change and affect the work of HR practitioners directly and vis-
ibly, in terms of issues like employee/industrial relations, recruitment, training and
development and pay. It should also be recognized that the nature of labour supply
is equally important and as the Cabinet Office (2003) has recently noted demographic
changes are having a significant impact on labour supply. In that sense the Cabinet
Office recognizes that most established European Union (EU) member states are
experiencing to a greater or lesser extent a number of challenges with regard to
labour supply. Specifically within a UK context:
? Declining birth rates mean that by 2011 under 16s will make up only 18 per cent
of the population in the UK.
? Increases in longevity, plus more young people into higher education, mean
that the ‘greying’ of the workforce – in 2006, 45–59 year olds formed the largest
group in the workplace.
? The workforce is becoming increasingly ‘feminized’ – by 2011, 82 per cent of
extra jobs will be taken by women.
? The role of people from ethnic minorities is likely to become increasingly
significant – they could account for no less than 50 per cent of growth in the
working population over the next decade.
? Migrant workers already make up much of the labour shortfall and are likely
to continue to do so.
Levels of analysis in the labour market
To further appreciate some of the points discussed above we can develop an
understanding of labour markets by recognizing several different levels of analysis,
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encompassing both the external and internal labour market. We begin with under-
standing the external labour market; that is the labour market outside of the organ-
ization and initially consider the idea of a transnational labour market.
Transnational labour market
Throughout time economic migration has meant that people have been willing to
move to find work or better paying jobs. In a more contemporary vein one of the
key drivers of an increasingly transnational and international labour market is the
role of multinational companies (MNCs). We have already noted in Chapter 2 how
the continuing growth of world markets, increased availability of management
and technological know-how in different countries, global competition and inter-
national customers, advances in telecommunications, and greater regional polit-
ical and economic integration have all increasingly pushed MNCs down the road
to seeking a more global orientation. Equally, we also noted how MNCs face choices
in how they staff their overseas units, including the use of expatriate managers and
how the use of such managers is commonplace in the tourism and hospitality
industry. Expatriate managers can be seen as denoting a rather more strategic use
of HR by MNCs. In addition to this more strategic movement of individual man-
agers, individuals may also choose to move internationally in their search for work
or enhanced career development.
Afurther aspect which has already been alluded to is the creation of regional
trading blocs. It is widely recognized that the EU is the most developed trading
bloc and already evidences a high degree of economic and social integration. With
regard to employment a key issue has been the commitment to sustain the free
movement of labour between member states. More recently the EU has seen the
accession of 10 new member states (Poland, Czech Republic, Hungary, Slovakia,
Lithuania, Latvia, Slovenia, Estonia, Cyprus (Greece) and Malta) from 1 May 2004
and some of the employment implications of the increase from 15 to 25 countries
within the EU are considered in HRM in practice 4.1.
National labour market
At the national level the government has a major influence on the labour market and
the manner in which policy is developed with regard to employment and economic
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issues will clearly impact on the nature of the national labour market. Generally
speaking when governments come to develop their labour market policy they face
a choice in terms of the extent to which they will seek to regulate employment
policies and practices. For example, it is often argued that there is a distinct differ-
ence between a European approach to labour markets, which is often described
as the European social model; and the so-called Anglo-Saxon approach, which is
represented by the US, and to an extent the UK. In simple terms it is suggested that
the European social model has tended to offer much greater regulation to achieve
HRM in practice 4.1 EU expansion: A solution
to labour and skill shortages in tourism and
hospitality?
The accession of the 10 new states from Central and Eastern Europe meant another 74
million people joined the world’s largest single market. Whilst there has been some con-
cern at the notion of large numbers of people seeking to move from Eastern to Western
Europe with the new immigrants proving a strain on existing member states, in reality,
the movement across Europe has been relatively small. In part, this is explicable by the
fact that initially only the UK, Irish and Swedish Governments allowed people from the
new accession states to work, as long as they register. The other 13 EU countries agreed
to impose restrictions on immigration from the east until at least 2006, and possibly till
2011. The decision of the British Government was largely driven by the recognition of
significant labour and skill shortages in a number of industries, including hospitality and
tourism, a situation likely to be exacerbated with the recognition that over 500 000 new
jobs are expected to be created to 2010. Many of those moving from the new member
states are young, well educated, highly motivated and seeking work in tourism and hos-
pitality. Employers in tourism and hospitality are already recognizing this new source of
labour and migrant workers seem to be viewed in a positive manner by employers. Jean
Urquhart, owner of the Cellidh Place, an arts hotel in Scotland, is quoted as saying, ‘The
whole tourism industry would collapse without them’. Similarly a manager from Pizza
Hut in Inverness suggests that his five Polish workers were ‘never sick, never late, they
just work away and we value them very, very highly’, even to the extent of suggesting
that they are better than Scottish workers. Corus Hotels is another company which has
taken advantage of the wider talent pool and targeted more workers from Eastern
Europe by recruiting over 30 new employees from Poland.
Derived from Cottell (2005), Gunn (2004), Meiklem (2004) and Warren (2004).
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a balance in interests between capital and labour, whilst in the US especially the
approach has relied much less on regulation and instead has operated on a free
market basis. Of course, this is something of an oversimplification, though it is
useful to delineate differing approaches and in more recent years the UK has
sought a balance between these two approaches with the so-called ‘third way’,
which seeks both a degree of regulation and flexibility. To appreciate why this is
the case it is worthwhile briefly considering recent labour market developments
in the UK, within the context of the discussion above.
In recent years there has been something of a change in policy within the UK. In
the period 1979–1997 the Conservative Governments of Margaret Thatcher and John
Major felt that there was too much regulation and the key thrust of much of their
policy towards the labour market was to remove what they viewed as rigidities in
the labour market. By espousing a free market with little regulation, the Conserva-
tive Governments argued that employers had greater freedom in developing their
employment policies and practices and that this was important for wealth creation.
The shift towards much less regulation in the labour market was felt to be especially
important for small businesses who often complain about the deleterious impact of
too much regulation on their business. As part of a whole series of legislation such as
the Wages Act 1986, Trade Union and Labour Relations Consolidation Act 1992 and the
Trade Union Reform and Employment Rights Act 1993 the Conservative Governments
sought to limit and restrict the autonomy and influence of trade unions as well as
allowing employers much greater latitude in areas such as hiring and dismissing
workers and pay setting.
Since 1997 the Blair Governments have attempted to keep many elements of
the flexible approach advocated by the previous government though they have, at
the same time, introduced some measures to regulate employment. Firstly, they
signed up to the enlarged EU Social Chapter in 1997. Although the Social Chapter
is not a legislative programme it does provide mechanisms for harmonizing min-
imum standards of employment and social provision across the EU. The previous
UK Conservative Government (1992–1997) had negotiated an opt-out, but with
the Labour Government signing up to the Social Chapter a number of HRM
policies were affected.
From a labour market point of view the most important impact was the intro-
duction of Directives on parental leave, working time and part-time employees.
The Parental Leave Directive allows parents to take up to 3 months unpaid leave
after the birth of a child, up to their 8th birthday (and see HRM in practice 4.2).
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The Working Time Regulations are considered more fully in Chapter 11. Lastly,
the regulations on part-time employees require employers to treat them no less
favourably than full-time employees. For example, part-time staff should receive the
same pay and benefits, on a pro-rata basis, as full-time employees. As we have
already noted in Chapter 1, hospitality and tourism is particularly reliant on part-
time workers and it was felt that this and the other Directives would be potentially
harmful to the viability of many businesses, particularly small business. In reality,
though, the impact has been less than feared, in part because employers have been
able to water down the regulations to lessen their impact (see for example Hurrell,
2005). In addition to signing up to the Social Chapter, the Blair Governments have
also introduced a range of employment-related legislation. Most noteworthy are the
National Minimum Wage Act 1998, Employment Relations Act 1999 and Employment Act
2002. These acts established minimum employment standards in areas such as pay,
dismissal and trade union recognition.
Whilst all of these aspects have certainly added some regulation to the labour
market and impacted on tourism and hospitality employers HRM policies, in reality
HRM in practice 4.2 Female friendly?
How do countries compare?
There is much debate about how best to respond to greater feminization in the labour
market and how best to balance work and family. A key issue within this broader debate
is the support from the state to women in providing maternity leave and pay and facili-
tating a return to work. Practices vary significantly between countries and this is a good
indicator of the extent to which governments are willing to intervene in a key labour
market issue. For example, in the UK women have the right to return to work after
26 weeks paid maternity leave. Employers also have to ‘seriously consider’ requests from
parents for more flexible working. This is in contrast to the US where there is no nation-
wide policy on parental rights and no national provision for maternity leave, paid or other-
wise. The same is also true for Australia where maternity leave is unpaid and only
available to employees who have been on the payroll for 12 months prior to the birth.
The most family-friendly countries are arguably Sweden and Norway. For example in
Sweden both parents are entitled to 18 months off work and in Norway a year’s leave is
paid at 80 per cent of salary.
Derived from Groskop (2006).
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the UK is felt to have a relatively unregulated labour market compared to most
other EU countries. Indeed, the UK Prime Minister Tony Blair still regularly claims
that the UK remains the most lightly regulated labour market of any of the leading
economies. What much of the above discussion points to is the recognition of
the impact of government policy on employment policy and HRM practices in
organizations. Thus, it is important to understand that this is an important environ-
mental and contextual feature in terms of how firms will plan their labour market
policies.
Sectoral labour market
To consider the nature of the sectoral labour market in tourism and hospitality,
we should remind ourselves again what kind of industry tourism and hospitality
is. As we have already noted the tourism and hospitality industry can be taken to
include a wide variety of organizations encompassing areas like hotels, guest-
houses, bed and breakfast, farm houses, holiday parks, restaurants, pubs and
cafes, airlines, cruise ships, travel agencies, tour companies and so on. Equally, we
also recognized that it would be wrong to imagine that the industry can be
thought of as homogenous (an obvious example is the spread of different types of
organizations in the industry, from the local chip shop to huge multinationals with
a presence all over the world). Despite this growth in larger chains most sectors of
the industry are still dominated by small, usually owner-managed units consisting
of family labour and a small number of helpers. Clearly, then, the sector is better
conceptualized as heterogeneous. However, whilst there is great heterogeneity in
the types and size of organizations there may be certain recurring features in large
parts of the tourism and hospitality industry, which are outlined below:
? Large numbers of individual units of varying size and many different types are
located throughout the whole of the country and internationally.
? Many units operate 24 hours a day, 7 days a week, 365 days a year.
? There are high fixed costs, a fixed rate of supply, but a fluctuating, seasonal and
often unpredictable demand.
? It is both a production and service industry.
? There is a wide variety of customers seeking to satisfy a variety of needs and
expectations. For example, leisure, business, conference and so on.
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? Services are supplied direct to the customer on the premises and the customer
usually leaves with no tangible product.
? Managers are expected to demonstrate proficiency in technical and craft skills
as well as in management areas.
? Many different skills are required but there are relatively large numbers of
semi- and unskilled staff.
? The majority of staff are low paid.
? Staff are often expected to work long and unsociable hours.
? There is a large proportion of female, part-time, casual, student and migrant
labour.
? Generally trade union membership is low.
? There is high labour mobility within the industry, and a high turnover of staff
joining and leaving the industry.
? The industry is labour intensive.
Perhaps the single biggest influence on the nature of labour markets in the tourism
and hospitality industry is the recognition that there are often wide fluctuations in
short-term demand for the product, which has major and obvious implications for
the staffing of an organization (and see Table 4.1).
Allied to this demand unpredictability is the fact that the industry is labour
intensive, which means labour is a high cost in the total costs of tourism and hospi-
tality businesses. Therefore many employers have tried to minimize labour costs.
This has meant that traditionally the industry has been staffed with what Wood
(1997) calls the so-called ‘marginal workers’, namely: women, young people, stu-
dents, migrant workers and ethnic minorities. Resultantly, it is argued by many that
these workers form the basis of a casualized, part-time workforce. This workforce
finds themselves in a low-skill job characterized by relatively low pay, which leads
to a lack of motivation and commitment on the part of employees, who may per-
ceive they are in a job which is often stereotyped as being about servility. Of course,
as we noted in Chapter 1, this description may be over generalizing the employ-
ment experience of many working in tourism and hospitality, and this characteri-
zation is unlikely to be true for all organizations, or reflect the circumstances for all
workers. For example, for many women working part-time will allow them to
match domestic and employment responsibilities. Equally, there may well be
skilled craft jobs which require some formal training or education, as opposed to
unskilled work which is just learnt on the job (and see HRM in practice 4.3).
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Table 4.1 Hotel demands variability
Examples of hotel demand variability
Daily Morning rush hour guest check-out and evening check-in peak demands for
restaurant services during meal time: breakfast (7–10 a.m.), lunch (12–2 p.m.)
and dinner (7–10 p.m.).
Weekly High occupancy during mid-week for business hotels, but low in weekends.
More restaurant reservations at the weekend.
Seasonal Winter closure of beach resorts. High occupancy rate in ski chalets during the
winter.
Ad hoc Flight cancellation leading to unpredictable demand for hotel rooms and meal
services. ‘Chance’ guest bookings.
Source: Lai and Baum (2005). Reprinted by permission of Emerald Group Publishing Ltd.
HRM in practice 4.3 Working in paradise
Patricia and Peter Adler (2004) offer an interesting example of how within luxury hotels
in Hawaii different types of employees are likely to have very different employment experi-
ences. Based on a near-10-year ethnographic study, Paradise Laborers is an attempt to
understand what goes on behind the scenes in five luxury hotels in Hawaii. Specifically,
Adler and Adler offer an in-depth analysis of the complex organizational and social sys-
tems of the hotels and how this impacts on the experiences of those working there; and
why, for many, working in the hospitality industry in Hawaii is akin to paradise. At the
heart of the book lies Adler and Adler’s typology of four different types of worker: new
immigrants, locals, seekers and managers. New immigrants are those who fill the most
menial, psychically demanding jobs in areas such as housekeeping and stewarding, pos-
itions which are considered undesirable by indigenous Americans. This characterization
of the new immigrants might suggest a life of hardship, drudgery and exploitation for
this group of workers. However, Adler and Adler note how the new immigrants were
‘highly valued, even crucial, workers in the hospitality and other local industries. While
others have depicted globalized workers as transient, our new immigrants became heav-
ily tied to and invested in their new country by opportunity, family, community, work, and
fierce loyalty’ (p. 217). Locals are equally tied to Hawaii – indeed Adler and Adler char-
acterize new immigrants and locals as being ‘trapped’, by choice, by the vicissitudes of
the local labour market. For many locals though, work in the resorts in regarded as being
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With regard to skill, Riley (1996) estimated that the skill composition in a typical
unit in the hospitality industry would consist of 6 per cent managerial, 8 per cent
supervisory, 22 per cent skilled craft workers and 64 per cent semi- or unskilled
operative staff, though see also HRM in practice 4.4.
desirable, unsurprising perhaps when travel and tourism provides over 20 per cent of
employment within Hawaii. Locals tended to occupy those jobs immediately above the
entry jobs taken by new immigrants in positions such as valets and bellmen and tended
to approach work with a ‘work to live’ attitude as ‘they did not want to live in paradise
if the cost was they could not enjoy it’ (p. 60). The latter two groups of seekers and man-
agers are characterized as being transient and primarily are affluent, middle-class, male,
mainland Americans who are usually just passing through Hawaii. Unlike new immi-
grants and locals, seekers and managers are able to draw on their inherent cultural cap-
ital, such as their education, which allows them greater occupational choice. However,
whilst managers are aiming to make a career in hospitality management and often work
long hours for relatively low rewards; seekers, or ‘drifter workers’ (p. 81), are attracted to
Hawaii to experience a much more hedonistic lifestyle, where leisure is foregrounded
over work, and work becomes a means to a recreationally focused end.
HRM in practice 4.4 Re-considering skill
Baum (2002) considers the nature of skill in the tourism and hospitality industry and argues
the need for more expansive thinking about the issue. Whilst broadly accepting Riley’s
characterization, Baum also points to the need to consider the changing nature of skills
in tourism and hospitality, with the emergence of aspects such as emotional and aes-
thetic labour. These ‘softer’ skills are harder to classify and locate within traditional
debates about the meaning of skill, dominated as they often are by the understanding of
skills being ‘hard’, technical skills, often accredited by qualifications or an apprenticeship.
Resultantly, the tendency towards describing much tourism and hospitality work as
unskilled may be increasingly oversimplified. Relatedly, Baum also questions the over-
whelmingly western centric view of skills, something that is inappropriate in a develop-
ing country context. Here many of the softer skills coming under the rubric of emotional
or aesthetic labour may be highly valued.
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In sum, then, the tourism and hospitality labour market is characterized by:
? Arelatively large proportion of unskilled occupations.
? Transferability of skills at any level between a broad range of establishments.
? Often, but not inevitably, high levels of labour turnover.
? Relatively low levels of pay, particularly for unskilled workers.
All of the above points mean that many organizations compete in what is often
described as the secondary labour market.
The internal labour market and the utilization of
flexible labour
Whilst the description of the broader context, as represented by the transnational,
national and sectoral labour markets, is important, we should also consider some
of the choices that organizations themselves will make in developing their internal
labour market. Riley (1996: 12) describes the internal labour market in the follow-
ing manner:
The concept of the internal labour market is based on the idea that sets of
rules and conventions form within an organization which act as allocative
mechanisms governing the movement of people and the pricing of jobs. Such
rules are about promotion criteria, training opportunities, pay differentials
and the evaluation of jobs, but most importantly, they are about which jobs
are ‘open’ to the external labour market.
Traditionally many tourism and hospitality organizations have failed to develop
strong internal labour markets, where skills are developed maximally via internal
promotion and upgrading, and managers have relied instead on the external labour
market, which is cheaper because labour is plentiful. Another aspect of the internal
labour market is the choices that organizations may face in their use of various form
of flexibility.
As we noted above the aim of much of the legislation of the Conservative
Governments of the 1980s and 1990s was to increase the flexibility of the labour
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LABOUR MARKETS 81
market. As Kelliher and Riley (2003: 99) note, ‘Flexibility was seen as a means of
enhancing competitiveness and adapting to changes in the business environment’.
Much of the debate generated about the nature of flexibility in organizations was
developed with recourse to the highly influential work of Atkinson (1984), which
proposed the ‘flexible firm’ model. Although subsequently heavily criticized, the
model does usefully distinguish between ‘core’ and ‘peripheral’ employees. The
former group are characterized as being permanent, usually full-time, staff that
are viewed as a valuable resource, likely to be multi-skilled and enjoying employ-
ment security and career progression. By contrast, the latter group are likely to be
part-time or casual, enjoy little employment security, have fewer skills and be eas-
ily disposable, reflecting Wood’s view of marginal workers described earlier. In
reality, as with other ideal types described in this book, these descriptions tend to
oversimplify the nature of core and peripheral staff in hospitality and tourism
(Deery and Jago, 2002). For example, Walsh (1990) has described how staff that
would be thought of as ‘peripheral’ will often be integral to the running of a hotel
and may be equally committed to the organization as core staff. Nevertheless, the
notion of core and peripheral workers is useful in pointing to the types of labour
flexibility utilized by tourism and hospitality organizations, two of the most
prominent being functional and numerical flexibility.
Functional flexibility
Functional flexibility is seen as the employer’s ability to deploy employees, and
more specifically core employees drawn from the primary labour market, between
activities and tasks. In increasing the range of tasks that an employee can under-
take employers will expect employees to be capable of working in different func-
tions within the same department, or even work between departments. Such an
approach can lead to increased skills, job satisfaction, more meaningful work and
enhanced career prospects for employees. Many descriptions of functional flexi-
bility in the tourism and hospitality sector, though, have pointed to a rather ad
hoc approach, which may be more about covering short-term problems rather
than creating a genuinely multi-skilled employee. This point has led Riley (1992)
to describe true functional flexibility within tourism and hospitality as being a
‘Cinderella idea’. However, Kelliher and Riley (2003) report research from four
case study organizations in the hospitality industry who had enjoyed benefits to
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HRM in practice 4.5 Marriott Marble Arch:
Aiming to multi-task and multi-skill
Lowe (2002) recognizes that, as with every other tourism and hospitality organization,
the London Marriott Marble Arch hotel has to cope constantly with staff recruitment,
retention and motivation to maintain high standards of customer services. The four-star
hotel introduced a cross-training scheme to improve the skills of its employees to help
them cope with the requirements of their job roles.
To improve their staff recruitment and retention, the Marble Arch hotel set up its
cross-training Discovery scheme. The programme was designed to increase staff skills
and to ease career promotions into higher or sideways positions through developing
employee skills in other areas. Last but not least, it also endeavoured to base labour
scheduling on a flexible, multi-skilled workforce, allowing the hotel to use its employees
in the most cost-effective manner. The scheme was targeted at every employee and was
completed during normal working hours. Overall, it took more than 320 hours, spread
over 40 one-day sessions, for the hotel to complete their Discovery cross-training. At the
end of the formal training each participant received individual feedback and a certificate
of achievement. The HR department was involved in co-ordinating the scheme, liaising
with heads of departments and getting constructive feedback from participants in order
to control and modify the scheme. Parallel to this, further developments were intro-
duced, such as a 2-week critical cross-training session was added to new associates’
90-day induction plan in order to make them develop skills within their critical departments.
For instance, new restaurant employees were supposed to spend time in the kitchen, bar
and banqueting areas. In addition, the programme was made available all the year and
HR ensured employees had completed their cross-training before letting them move
within departments.
The Discovery scheme led to substantial improvements. It impacted positively on
two performance measures. First, the programme improved the Balanced Score Card, a
tool used for measuring and communicating hotel performance at Marriott hotels.
both employers and employees in introducing functional flexibility. Employers
reported more efficient use of labour, lower labour costs, better operational func-
tioning, improved customer service, reduced levels of labour turnover and an
improvement of their position in the local labour market. Employees also reported
increased job satisfaction, greater job security and enhanced remuneration (and
see also HRM in practice 4.5).
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LABOUR MARKETS 83
Second, the results of an annual employee survey significantly improved. Employees felt
that training to carry out daily tasks improved, raising its score from 21 to 87 per cent.
They also believed their opportunities to develop their career had increased by 4 per cent
and 84 per cent felt that they had accessible job opportunities compared to only 9 per
cent before the introduction of the scheme. As Lowe, HR manager at the hotel, com-
ments, ‘The initiative has proved invaluable to the London Marriott Marble Arch hotel. It
is a concept that could easily be adapted to other businesses to help meet the constant
challenge of staff recruitment and retention’ (p. 14). Indeed, the hotel was awarded the
large establishment category prize at the large annual Excellence through People Awards
held by the British Hospitality Association in 2002.
Numerical flexibility
Numerical flexibility refers to the capacity of employers to adjust labour supply to
fluctuations in business demand, which may equal less job security, low pay, lack of
opportunities for training and career advancement for employees. Unsurprisingly
given this description the peripheral workforce is most often associated with numer-
ical flexibility. In pursuing numerical flexibility employers can look to either internal
or external means (Lai and Baum, 2005). Internal means are largely concerned with
the use of ‘non-standard employment contracts’, such as part-time and shift work-
ing and the use of temporary and casual workers. External means include aspects
such as contracting out services, for example a hotel contracting out its leisure facil-
ities, and the use of agency staff (and see HRM in practice 4.6).
In addition to functional and numerical flexibility, tourism and hospitality
organizations can also use temporal flexibility, such as annual hours contracts and
job sharing; and pay flexibility, for example enhanced payments in return for being
functionally flexible.
It is interesting here to briefly think about the descriptions of flexibility within
our earlier discussion of hard and soft HRM. As we noted in Chapter 1 hard and
soft HRM allow us to appreciate that the reason for organizations adopting certain
HR practices may vary. Based on our description of the two approaches we could,
rather crudely, characterize numerical flexibility as being largely about hard HRM.
This hard approach emphasizes the use of labour which is aimed at reducing
labour costs, either by the most efficient use of labour or alternatively its most
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 84
effective exploitation. In this view approaches to flexibility will be concerned with
minimizing labour costs and ensuring the size and mix of labour inputs is adjusted
to changes in product demand. On the other hand, the soft approach is more con-
cerned with broadening employees’ skills through training to create workforces
which are flexible. Such a description is more concerned with functional flexibility.
As we have seen the most frequently utilized method of flexibility in the tourism
and hospitality industry is numerical flexibly, which is often characterized by low-
paid, low-skill, casual and part-time operative level work. An example of such an
approach would be a pool of available staff that could be called in at short notice
to work in the organization, for example, in the banqueting department of a hotel.
Indeed, many have argued that talk of flexibility and core and peripheral workers
induces nothing more than an ominous sense of déjà vu within the tourism and
hospitality industry. Due to the nature of the industry, patterns of employment
within tourism and hospitality have largely been arranged in a way that promotes
a high degree of employment flexibility, through the use of employment practices
that have often left individual workers with limited opportunities for advance-
ment and low job security. Wood (1997: 168), for example, argues that, ‘Flexible
working practices in the commercial hotel and catering sector are not new to the
industry, the use of part-time casual and part-time workers and multi-skilled staff
being a common and arguable defining feature of labour organization in some
sectors, most notably small hotel business’.
HRM in practice 4.6 Just in time labour supply
in the hotel sector
Many four- and five-star hotels will often rely on agency staff recruited from employment
agencies, particularly in areas such as housekeeping. Research by Lai and Baum (2005)
suggests that hotels can reduce labour costs by utilizing agency staff thus avoiding having
to pay fringe benefits such as sickness cover, pension contributions, maternity leave pay-
ments and holiday entitlements, all of which are covered by the employment agency.
Additionally, HR activities such as recruitment and selection, induction and training are
often undertaken by the agencies. Lai and Baum suggest that one hotel in their research
saved up to £500000 a year in housekeeping payroll costs. In addition to cost savings, Lai
and Baum also found that agency staff had often worked for the same hotel for a num-
ber of years with the consequence that quality and performance were improved.
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LABOUR MARKETS 85
Conclusions
We have outlined a fairly bleak scenario of what traditionally the organizational
characteristics of the tourism and hospitality industry have meant for those work-
ing in the industry. The tendency to short termism and ad hocism is the key feature
of labour markets in the industry. Management responses to these issues are also
similarly short term and ad hoc, with their role often being one of responding to situ-
ations and unanticipated crises, or trying to cope with varying demand. This, of
course, leaves us with an obvious paradox, namely how can the tourism and hos-
pitality industry compromise the need for staffing flexibility with the attainment
and maintenance of a quality service and product to the customer? There are no
easy answers to this conundrum and even a cursory understanding of the nature of
labour markets in tourism and hospitality allows us to appreciate this point.
References and further reading
Adler, P. and Adler, P. (2004) Paradise Laborers: Hotel Work in the Global Economy, Cornell University Press.
Atkinson, J. (1984) ‘Manpower strategies for flexible organizations’, Personnel Management, 16(8), 28–31.
Baum, T. (2002) ‘Skills and training for the hospitality sector: a review of issues’, Journal of Vocational
Education and Training, 54(3), 343–363.
Cabinet Office (2003) Ethnic Minorities and the Labour Market, Cabinet Office.
Cottell, C. (2005) ‘An industry in need of serving suggestions’, Guardian Work, 26 March, 21.
Deery, M. and Jago, L. (2002) ‘The core and periphery: an examination of the flexible workforce model in
the hotel industry’, International Journal of Hospitality Management, 21(4), 339–351.
Groskop, V. (2006) ‘Mamafesto’, New Statesman, 17 July, 26–28.
Gunn, J. (2004) ‘New EU states workers could ease jobs crisis’, Caterer and Hotelkeeper, 5 August, 7.
Hurrell, S. (2005) ‘Dilute to taste? The impact of the working time regulations in the hospitality industry’,
Employee Relations, 27(5), 523–546.
Kelliher, C. and Riley, M. (2003) ‘Beyond flexibility: some by-products of functional flexibility’, Service
Industries Journal, 23(4), 98–113.
Lai, P. and Baum, T. (2005) ‘Just-in-time labour supply in the hotel sector: the role of agencies’, Employee
Relations, 27(1), 86–102.
Lowe, C. (2002) ‘Marriott’s cross-training’, Leisure and Hospitality Business, 29 November, 14.
Meiklem, P. (2004) ‘Highland hospitality … courtesy of Eastern Europeans’, Sunday Herald, 14 November, 9.
Riley, M. (1992) ‘Functional flexibility in hotels – is it feasible?’, Tourism Management, 13(4), 363–367.
Riley, M. (1996) Human Resource Management in the Hospitality and Tourism Industry, Butterworth-
Heinemann, 2nd edition.
Walsh, T. (1990) ‘Flexible employment in the retail and hotel trades’, in A. Pollert (ed.) Farewell to Flexibility,
Blackwell, 140–150.
Warren, C. (2004) ‘Continental drift’, People Management, 6 May, 28–33.
Wood, R. C. (1997) Working in Hotels and Catering, International Thomson Press, 2nd edition.
Ch04-H6572.qxd 11/22/06 5:50 PM Page 85
Websites
The International Labour Office produces an annual labour market indicator and details of this and other
aspects of their work on labour markets can be found at http:/ //www.ilo.org/public/english/employment/
strat/kilm/
The European Foundation for the Improvement of Living and Working Conditions has some interesting
material and other links at http:/ //www.eurofound. eu.int/areas/labourmarket/index.htm/
The UK Government’s official statistics website http:///www.statistics.gov.uk/cci/nscl.asp?id?5006 has some
interesting labour market statistics.
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Chapter 5
Recruitment and
selection
Chapter objectives
This chapter addresses recruitment and selection
in the tourism and hospitality industry. In
particular the chapter aims:
? To understand the differences between, yet
complementary nature of, recruitment and
selection.
? To appreciate the importance of job descriptions
and person specifications/competency profiles
in recruitment and selection.
? To recognize the type of people and skills that
tourism and hospitality organizations are
seeking.
? To consider the range of selection techniques
available to tourism and hospitality
organizations.
87
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Introduction
Generally recruiting and selecting people to fill new or existing positions is a cru-
cial element of human resource activity in all tourism and hospitality organiza-
tions, irrespective of size, structure or activity. Although we have noted how the
importance of service quality has increased the pressure on organizations to select
the ‘right’ kind of individual, it is often widely suggested that too often decisions
are made in an informal, ad hoc and reactive manner. This point may be especially
true in smaller organizations that may not have well developed HRM functions or
recruitment and selection systems, and may recruit irregularly with heavy reliance
on informal systems and methods (Jameson, 2000). Indeed, within the context of
the hospitality sector, Price (1994) found that of 241 hotels sampled in her research,
a third never used job descriptions or person specifications. More recently,
Lockyer and Scholarios (2005) surveyed over 80 hotels and again found a general
lack of systematic procedures for recruitment and selection. This lack of system-
ization may seem strange when many writers would point to the cost of poor
recruitment and selection being manifested in such things as:
? expensive use of management time;
? retraining performers;
? recruiting replacements for individuals who leave very quickly;
? high-labour turnover;
? absenteeism;
? low morale;
? ineffective management and supervision;
? disciplinary problems;
? dismissals.
Clearly then it is important for organizations to consider how they can approach
recruitment and selection to increase the likelihood of a successful appoint-
ment/decision and in a cost effective manner. Reflecting this latter idea of cost
effectiveness it is important to recognize the contingent nature of recruitment and
selection. Thus, although there may be good practice approaches to recruitment
and selection these are not going to be appropriate for all positions available in an
organization. For example, for a management traineeship in a major hotel the com-
pany may use a variety of sophisticated and costly mechanisms culminating in
an assessment centre. On the other hand for a part-time seasonal position in a
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RECRUI TMENT AND SELECTI ON
fairground the company may recruit an employee based on word of mouth.
Indeed, in considering why it may be difficult for tourism and hospitality compa-
nies to aim for best practice in recruitment and selection Lockyer and Scholarios
(2005) recognize that the lack of formality can often be overcome by effective use of
local networks in recruiting employees. For example, they suggest that the person
responsible for selection should have a good knowledge of the local labour market
and be able to make the best use of informal networks to find suitable employees.
Afurther point to consider by way of introduction is the notion of ‘fit’ between
the individual and the organization who are seeking to attract and admit those who
are considered ‘right’ for the organization, in terms of issues like commitment, flexi-
bility, quality, ability to work in a team and so on. Thus, the match between the indi-
vidual and organization may be ‘loose’, that is applicants having the ability to do the
job; or ‘tight’, where the individual has to demonstrate not only technical competence
but whether they have a specific personality profile to ‘fit’ the organizational culture,
as discussed in Chapter 3. In such circumstances clearly there is the possibility to see
the notion of tight fit between organization and individual in a slightly sinister way
and we will consider this point throughout the chapter. Relatedly, there is the idea of
discrimination being a key issue within the recruitment and selection process. Of
course, at one level recruitment and selection is inherently discriminatory as, at times,
organizations will have to choose between two or more applicants for a job, particu-
larly for managerial positions. Crucially though such discrimination should be based
on the applicants ability to do the job. Thus companies are discriminating all the time
89
HRM in practice 5.1 Skills involved in the
recruitment and selection process
The recruitment and selection process The skills required
Job description Evaluation of the vacancy
Person specification Drafting the criteria
Advertisement Summarising
Shortlist Fair discrimination
Interview Questioning skills
Selection tests Listening skills
References Assessment skills
Decision Evaluation
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on the basis of whether or not candidates have the attributes and skills to do the job,
but this should not contravene statutes in areas such as race, sex and disability (and
see Chapter 6). One final point by way of introduction is to recognize the range of
skills which managers need in the recruitment and selection process. As many line
managers in tourism and hospitality, as well as human resource specialists, are
increasingly involved in recruitment and selection it is important that they should
recognize the skills required in such a process (and see HRM in practice 5.1).
Recruitment
Recruitment is defined by Heery and Noon (2001: 298) as ‘the process of generat-
ing a pool of candidates from which to select the appropriate person to fill a job
vacancy’. In essence, in the recruitment process organizations are seeking to attract
and retain the interest of suitable candidates, whilst at the same time also seeking
to portray a positive image to potential applicants. Of course, recruitment is a
dynamic process as within organizations people are constantly retiring, resigning,
being promoted or, at times, being dismissed. Equally, changes in technology, pro-
cedures or markets may all mean that jobs are re-configured and become available
to the external labour and thereby trigger the recruitment and selection process.
Having decided to recruit, organizations will ordinarily consider a range of ques-
tion to determine how they might approach filling the vacancy. Specifically, they
might ask themselves the following questions:
? What does the job consist of?
? What are the aspects of the job that specify the type of candidate?
? What are the key aspects of the job that the ideal candidate wants to know
before applying?
Conventionally the answers to these questions will be provided by job analysis,
the job description and person specification, which allow the candidates to gauge
their chances of being appointed.
Job analysis
Armstrong (1999: 190) defines job analysis as ‘the process of collecting, analysing
and setting out information about the contents of jobs in order to provide the basis
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for a job description and data for recruitment, training, job evaluation and perform-
ance management’. Marchington and Wilkinson (2005) suggest that undertaking a
job analysis may not be necessary for every time a vacancy arises, especially in
organizations that have high levels of labour turnover. However, they do recognize
that job analysis does allow for an examination of whether existing job descriptions
and person specifications/competency profiles are appropriate for future needs.
The same authors also recognize that there is likely to be variation in terms of the
sophistication, cost, convenience and acceptability of job analysis and this will also
determine the methods utilized to analyse a job. Organizations may use one or more
of the following methods: observation of the job, work diaries, interviews with job
holders and questionnaires and checklists. The output from such job analysis is the
job description and person specification.
Job description
Heery and Noon (2001: 186) describe the job description as, ‘Adocument that out-
lines the purposes of the job, the task involved, the duties and responsibilities, the
performance of objectives and the reporting relationships. It will give details of the
terms and conditions, including the remuneration package and hours of work’. In
many respects the job description can be thought of as a functional document
which outlines the ‘what’ elements of a job. It should aim to provide clear infor-
mation to candidates about the organization and the job itself, such that it acts as a
realistic preview of the job. Importantly, as well as offering a realistic description
of the nature of the job, the job description should also act as a marketing docu-
ment that seeks to make the job look attractive to potential applicants.
Person specification/competency profile in the recruitment context
Whilst the job description considers the ‘what’ aspects of the job, the person spec-
ification is concerned with the ‘who’. In this way the person specification should
aim to provide a profile of the ‘ideal’ person for the job. In reality, the ideal person
may not exist, but the person specification provides a framework to assess how
close candidates come to being the ideal. Conventionally the person specification
is a document which describes the personal skills and characteristics required to
fill the position, usually listed under ‘essential’ and ‘desirable’ headings. In that
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sense essential criteria form the minimum standard expected for any given job and
will form the basis for potentially rejecting applicants. For example, if an advert
for a tour company manager stipulates a degree in a travel and tourism-related
area, then non-degree holders would be automatically excluded. On the other
hand the desirable criteria are those things which are considered over and above
the minimum and should provide the basis for selection. For example, an organi-
zation may stipulate that for the same managerial job we have just outlined that a
foreign language is desirable. If a candidate had a foreign language they may be at
an advantage to other candidates who do not, though ultimately the company
may appoint somebody who does not have a language.
The two most important person specification models are those provided by
Alec Rodger in 1952 and John Munro Fraser in 1954 (Torrington et al., 2005).
Rodger seven-point plan
1 Physical characteristics – such as the ability to lift heavy loads or appearance,
speech and manner.
2 Attainments – educational/professional qualifications, work experience considered
necessary for the job.
3 General intelligence – such as the ability to define and solve problems.
4 Special aptitudes – skills, attributes or competencies relevant to the job.
5 Interests – work related or leisure pursuits that may have a bearing on the job.
6 Disposition – job-related behaviours, for example demonstrating friendliness.
7 Circumstances – for example domestic commitments or ability to work unsocial
hours.
Munro Fraser five-fold grading system
1 Impact on other people – similar to Rodgers physical make-up.
2 Qualifications and experience – similar to Rodgers attainments.
3 Innate abilities and aptitude – similar to Rodgers general intelligence.
4 Motivation – a person’s desire to succeed in the workplace.
5 Adjustment – personality factors that may impact on things like ability to cope
with difficult customers.
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More recently, Marchington and Wilkinson (2005) note how many companies now
use competency frameworks to outline the type of person that they are seeking.
The focus of competency frameworks is on the behaviours of job applicants and
they are useful as they can also set a framework for other subsequent HR practices,
such as performance management and pay. Marchington and Wilkinson (2005:
169) also note how, ‘the competencies can be related to specific performance out-
comes rather than being concerned with potentially vague processes, such as dis-
position or interests outside of work’. The use of competencies tends to focus on
areas such as team orientation, communication, people management, customer
focus, results orientation and problem-solving.
Regardless though of whether organizations are using person specifications or
competency frameworks, tourism and hospitality organizations are now seeking
employees, especially those who will interact with customers, with certain types
of skills.
The ‘ideal’ front-line tourism and hospitality employee
With the shift to a service economy the type of skills demanded by employers has
also shifted. Employers in hospitality and tourism in both the UK and elsewhere
increasingly desire employees with the ‘right’ attitude and appearance (Chan and
Coleman, 2004; Nickson et al., 2005). The right attitude encompasses aspects such
as social and interpersonal skills, which are largely concerned with ensuring
employees are responsive, courteous and understanding with customers, or in sim-
ple terms can demonstrate emotional labour. However, it is not only the right atti-
tude that employers seek. Nickson et al. (2001) have developed the term ‘aesthetic
labour’ – the ability to either ‘look good’ or ‘sound right’ (Warhurst and Nickson,
2001) – which points to the increasing importance of the way in which employees
are expected to physically embody the company image in tourism and hospitality.
Review and reflect
What are the types of skills that tourism and hospitality organizations are likely to seek in
their front-line staff? How can these skills be discerned in the recruitment and selection
process?
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In an analysis of 5000 jobs advertisements across a number of different occu-
pations and sectors in the UK, Jackson et al. (2005) found that the skills stated as
necessary by employers are ‘social skills’ and ‘personal characteristics’; only 26 per
cent of organizations mentioned the need for educational requirements. Within
personal services this figure was less than 10 per cent. Furthermore Jackson et al.
found numerous instances of front-line service jobs asking for attributes that
referred less to what individuals could do than to what they were like, such as
being ‘well-turned out’ or ‘well-spoken’, or having ‘good appearance’, ‘good
manners’, ‘character’ or ‘presence’.
Nickson et al. (2005) also report evidence from a survey of nearly 150 employ-
ers in the retail and hospitality industry. On the question of what employers are
looking for in customer facing staff during the selection process, Nickson et al.
found that 65 per cent suggested that the right personality was critical, with the
remainder of respondents suggesting this aspect was important. Equally, 33 per
cent of the employers surveyed felt that the right appearance was critical and
57 per cent as important, only 2 per cent of respondents felt it was not important.
These figures can be compared to qualifications, with only one respondent seeing
qualifications as critical, 19 per cent of employers felt it was important and 40 per
cent suggested it was not important at all for selecting their customer facing staff.
In terms of the skills deemed necessary to do the required work, employers
placed a far greater emphasis on ‘soft’ skills for customer facing staff. Ninety-nine
per cent of respondents felt that social or interpersonal skills were felt to be of at
least significant importance, and 98 per cent felt likewise about self-presentation,
or aesthetic, skills. Conversely 48 per cent of employers felt that technical skills
were important in their customer facing staff and 16 per cent stated they were not
important at all. The skills that matter to employers in customer facing staff in
tourism and hospitality are generally then ‘soft’, including aesthetic skills, rather
than ‘hard’ technical skills, which will often be trained in when people join the
organization (and see HRM in practice 5.2).
Of course we should recognize that the use of person specifications and com-
petency frameworks may still involve a degree of subjectivity, especially in judg-
ing which potential employees have the ‘right’ kind of attitude or appearance.
Evidence suggests that employers will often make judgements which penalize
people for not having the ‘right’ appearance or attitude (Nickson et al., 2003).
Clearly, then, there is the potential for overt and not so overt forms of discrimina-
tion in how person specifications and competency frameworks may be used by
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HRM in practice 5.2 ‘Scotland with Style’:
aesthetic labour and employees who
look good and sound right
Glasgow was once an industrial city. Now, over 85 per cent of the city’s jobs are in serv-
ices. Aiming for the city break tourist market, the city promotes its retail, cultural and
hospitality attractions. Between 1994 and 2000, the number of major hotels in the city
increased from 42 to 89, with 27 more planned. Glasgow has approximately 1000 bars
and restaurants and is second only to London as Britain’s culinary capital. Similarly,
Experian acknowledges Glasgow as the second largest retail centre in the UK outside
London. The city also now has a well-developed niche of designer retailers, boutique
hotels and style bars, cafes and restaurants. Not surprisingly, the city was recently
described by US magazine Travel and Leisure as ‘The UK’s hippest and most happening
city’. Three million tourists visit the city each year, generating £670 m annually in the local
economy. In recognition of this new economic success, the city re-branded itself as
‘Scotland with Style’ in 2004.
To take advantage of this booming tourist market and reflecting the city’s new
image, tourism and hospitality employers want staff with the right customer service
skills. Job adverts specify that applicants be ‘well spoken and of smart appearance’ or
‘very well presented’. One Scottish-based boutique hotel company, known pseudo-
nymsly as Elba, has created a sophisticated recruitment, selection and training pro-
gramme for its new staff. Elba has hotels in two Scottish cities and has expanded into
England and France. Opening a new hotel in Glasgow, the company deliberately placed
job advertisements in the Sunday Times rather than local evening newspapers. Opening
a hotel in Newcastle, England, it placed TV adverts during programmes aimed at the
youth market. As a consequence, its typical front of house employee is in his or her twen-
ties, a graduate and well travelled. Recruitment literature featured a person description
not a job description, asking applicants to assess themselves by the 13 words that char-
acterized that company’s image; ‘stylish’ and ‘tasty’ for example. After a telephone inter-
view, application with CV and then a face-to-face interview, there was a 10-day
induction at the Glasgow hotel in which extensive grooming and deportment training
was given to the staff by external consultants. Sessions included individual ‘make-overs’
for staff, teaching them about hair cuts/styling, teaching female staff about make-up,
male staff how to shave and, for all, the expected appearance standards. The sessions
were intended to relay ‘this is what we want you to actually look like ... you have to
understand what “successful” looks like ... what “confident” looks like.’ The hotel
wanted staff that were confident, with a good attitude and appearance. ‘There is an Elba
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those making the final decision about who is to be employed by the organization,
a point considered in further detail in Chapter 6.
Ultimately in considering the person specification or competency profile it
would seem sensible for organizations to consider several points.
? Are all the items on your person specification/competency profile relevant to
the job?
? Are you reasonably sure that none of your criteria would discriminate unfairly
against a group of potential candidates?
? Would your person specification/competency profile enable a shortlisting and
interviewing panel to distinguish clearly between candidates?
Having reviewed the importance of the job description and person specification/
competency requirements we can now move on to consider how organizations can
attract the interest of appropriate potential employees. Initially, there may be a
choice as to whether the organization looks to somebody within the organization or
alternatively looks to the external labour market. For example, for a promotable
position organizations which are seeking to sustain a strong internal labour market
may have a policy to offer this position in-house first to existing staff. Equally,
though, the organization may feel that offering such positions to the external labour
market is important to bring in new ideas and new blood to the organization. In
deciding their target group organizations may also wish to address issues such as
under representation of a particular group, for example ethnic minority employees
or women managers, a point that is further considered in the following chapter.
Generally speaking organizations have a number of methods which they can
consider in seeking to engage with their target market for new employees. First, as
we have already noted they may use existing employees. For example, this can be
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 96
look’, said the hotel manager, ‘neat and stylish…young, very friendly ... people that fit in
with the whole concept of the hotel’ (Nickson et al., 2001: 180). The hotel wanted staff
able to project the company’s image and help it differentiate itself in a crowded and com-
petitive market. It is a policy that seems to pay: the hotel claims above average occu-
pancy rates for the city.
Derived from Nickson et al. (2001, 2005).
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RECRUI TMENT AND SELECTI ON 97
in relation to promotable positions or also in terms of word-of-mouth approaches,
which are commonplace in tourism and hospitality, especially for front-line posi-
tions. Alternatively the organization may choose to use external contacts, such as
job centres. Indeed, this may well be something that organizations see as impor-
tant in their attempts to be good corporate citizens (and see HRM in practice 5.3).
HRM in practice 5.3 Jurys Inns: offering
a helping hand to the unemployed
The Jurys Inn hotel is a three-star plus hotel chain targeting business travellers and leisure
guests. It is the key brand of the Irish Jurys Doyle Hotel Group PLC that owns and oper-
ates three-, four- and five-star hotels in the UK, Ireland and the US, and has a workforce
of 4000 employees. As any other companies in the highly competitive and unstable hos-
pitality sector, the Jurys Inn hotel had to develop a successful strategy to stand out from
the competition and weather the economic slowdown. Among the strategic initiatives
was a recruitment and training strategy aimed at improving the quality of customer serv-
ice. Every time Jurys Doyle Hotels opens a new Jurys Inn, they rely on key local employ-
ment providers, such as the Job Centre Plus, the local council and a local training
provider, such as a college, to develop a gateway training programme for people willing
to move into the hotel industry. Applicants who have passed the initial sifting process are
then invited to an 8-week pre-employment training programme run in partnership
between Jurys Doyle Hotels and the training provider. This programme has proved suc-
cessful since it was first launched in 1993 and 20 people who are currently working in
the company are estimated to have joined the pre-employment scheme. It is now esti-
mated that there are, on average, 30 places available at each new Inn, representing
25 to 50 per cent of the staff base. After the pre-employment period, successful candidates
and other new recruits alike join the Guest Service Staff (GSS) training 4 weeks before an
opening. The main objective of this scheme is to develop a multi-skilled team able to
operate within all areas of the hotel. Furthermore, the programme has no time limit and
is available for every employee willing to advance their career. Finally, to make sure
its employees are the most effective in the industry, Jurys Doyle Hotel strive to ensure
that their staff gain external or professional qualifications such as National Vocational
Qualifications (NVQ) or CIPD qualifications.
Jurys Inn’s recruitment and training strategy has helped them expand in a recent
context of economic slowdown. Aside from building Jurys Inn’s skill base, the pre-
employment scheme has contributed to creating jobs in cities often hit by unemployment,
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 98
thereby improving employee loyalty to the hotel. In addition, it involves new recruits in
the development of the building in which they are to work. This helps build the involve-
ment of employees who might have had doubts about the scheme or working in a hotel.
On the other hand, the GSS training aimed at developing multi-skilled staff, is beneficial
both to the employer, who seek to maximize the use of its workforce, and to the employee
who gains diverse levels of experience and benefit from more flexible working hours, as
they are able to take on a number of different roles. As Edward Gallier, development and
training manager for the UK and Ireland, puts it, ‘Our employees can work anywhere in the
Inn ... this means we have GSS who can deliver the services of a receptionist, room atten-
dant or porter equally well, with the confidence good training gives them’.
Source: Gallier (2004).
Afurther key aspect of looking externally for new employees is the importance
of advertising and media. An obvious starting point here is the printed media and
specifically the press. The use of the print media to advertise jobs is one of the most
popular formal methods of recruitment. When thinking about where adverts are best
placed organizations need to be cognizant of the labour market on which they are
hoping to draw for a particular job. In recognizing the most appropriate labour mar-
kets organizations could conceivably place adverts in either the local/national press
or in trade and professional journals. For example, for a front-line position it is likely
that the local press will be used, whilst for a managerial or specialist position the use
of the national press or trade press may be more appropriate. In using the printed
media it is important to consider the manner in which organizations can portray the
desired image and here we will consider how this issue can be addressed.
When organizations advertise vacancies it is important that they convey the
right message in order to attract suitable applicants and discourage those who do
not have the necessary attributes. Equally important is that advertisements project
a positive image of the company and in that sense adverts can be considered a sell-
ing document. Initially organizations have the choice to get it alone and contact
the media directly or alternatively they can deal with an advertising agency, who
can help in drafting and placing an advert. Advertising agencies can be thought of
as experts who can offer advice on the choice of advertising copy and the choice of
media. They may also have better contacts to ensure advertising space at short
notice. The only drawback is that agencies may also be rather costly. Regardless of
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whether an agency is used or not there are certain key points which should be
borne in mind in devising an advert and at the very least the following aspects
should be apparent (Torrington et al., 2005: 128).
? Name and brief details of the employing organization.
? Job role and duties.
? Key points of the person specification or competency framework.
? Salary.
? Instructions about how to apply.
Moreover organizations should also consider the image they are portraying and
the CIPD and the Institute of Professional Advertisers (IPA) outline the following
criteria for judging excellence in recruitment advertising (CIPD, 2006):
? visual impact,
? typography and balance,
? clarity of message to the target audience,
? promotion of job vacancy,
? projection of a professional organizational image,
? focus on workplace diversity.
With regard to that last bullet point it is important to reiterate that adverts must not
discriminate on grounds of sex, race, sexuality, religious orientation and disability.
In addition there are other areas which can potentially be used including TV,
radio, cinema, careers exhibitions, conferences and open days and posters. Whilst
TV, radio and cinema adverts have been utilized to recruit in areas like the military
or teaching they are much less likely to be used by tourism and hospitality
organizations. The other aspects though could all be conceivably used. For example,
Review and reflect
Using the above criteria attempt to find a job advertisement for a tourism and hospital-
ity organization which exemplifies at least some of these aspects and briefly describe why
these aspects makes a job look attractive.
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TGI Fridays, the American restaurant chain, have successfully used open days to
recruit staff in the UK. As a company with a very distinctive service style open
days are felt to be useful to expose potential employees to the nature of the work
they will be undertaking. As the company is looking for very outgoing individu-
als who can do things like juggle or sing whilst serving customers the open day is
designed to assess such aspects. Team tasks and tricks and dances are just some of
the things that potential employees will be expected to demonstrate in their ‘audi-
tion’ during the open day (Baker, 1999; and see HRM in practice 5.4).
Another source of recruitment is increasingly the Internet. IDS (2003) have
recently noted how the use of the Internet in recruitment has tended to be comple-
mentary to existing methods, rather than replacing them. In this sense, although
the Internet is playing a growing role in organizations recruitment strategies, its
importance should not be exaggerated. For most companies the use of Internet
tends to be in terms of sections on their websites that allow job seekers to check for
current vacancies. Beyond this facility there may be more strategic approaches in
using the web, particularly with regard to the ability to receive and process job
applications online, something which is outlined in HRM in practice 5.5.
Smethurst (2004) notes other reasons for employers, including Whitbread, for
using online recruitment, including:
? Reducing cost per hire.
? Increasing speed to hire.
? Strengthening the employer brand.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 100
HRM in practice 5.4 Who would you
most like to be stuck in a lift with?
Hills (2004) reports on the recruitment process in Tiger Tiger, which is one of the UK’s
most popular nightclub groups. As part of their recruitment process they host open days
to allow potential employees to sample the Tiger Tiger atmosphere. A general manager,
Beverley Harley, is quoted as saying, ‘the leisure sector is a particularly social and com-
petitive one and we’re on the hunt for hardworking team players’. As part of assessing
whether applicants have these attributes, during the open day potential employees take
part in various ‘fun’ activities, including being asked who they would most like to be
stuck in a lift with and which type of animal they would choose to be.
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RECRUI TMENT AND SELECTI ON 101
HRM in practice 5.5 Hilton International:
spreading the web
Beal (2004) notes how Hilton International wanted to improve its fast-track Elevator pro-
gramme – a selection tool introduced in 1998 and designed to recruit highly talented
graduates as future hotel general managers. As new graduates had to learn the role of
a manager in a short period of time, the tool had to be extremely reliable to pick up the
right candidates. As such, the Elevator scheme, which involved hand-processing and
scoring an application form, conducting a face-to-face meeting, psychometric testing
and conducting a final 24-h assessment centre, proved costly and time-consuming, espe-
cially in terms of senior management involvement.
To streamline its selection tool, Hilton International commissioned the business-
psychology consultancy Human Factor International to introduce a web-based screening
system – a so-called ‘virtual psychologist’ – running in five European languages. This online
tool would not have been possible without a technological breakthrough which allows for
a time limit on the intellectual-reasoning part of the test. The system was successfully
implemented in 15 working days, from Christmas 2003 to 20 January 2004. Since the run-
ning of the programme, Hilton has invited applicants through presentations at the main
European hotel schools and universities to apply through the website http://www.hilton-
university.com and complete the standard application form. Those who pass the initial sift-
ing are then asked to fill in online ‘personality’ and ‘workplace values’ questionnaires. At
this stage all candidates receive an electronic report analysing their results and providing
tailored career advice. Successful candidates are then invited to complete three ability and
skill tests of 15min each before being selected to the assessment centre. At the end of the
assessment centre unsuccessful candidates receive detailed e-mailed feedback outlining
the reasons why they have not been chosen and inviting them to phone in if they want to
have further explanations. As Christine Jones, Director of the Consultancy Human Factor
International adds, ‘Even unsuccessful candidates have told us they have been pleased with
the feedback they have been given, and are comfortable with it’ (p. 31).
By introducing the online system, Hilton has been able to reduce the number of assess-
ment days without damaging the quality of its new recruits. Indeed, the 14 graduates who
first joined Hilton through this tool had to pass only two final assessment centres rather than
the five or six previously needed. As John Guthrie, Head of International Management at
Hilton International comments, ‘While unlikely to save significant costs in pure cash terms,
getting rid of manual processes has freed up managers’ time to concentrate on more value-
adding work. Additionally, it helps to portray the organization as more contemporary and
technologically oriented and strengthens our appeal in a competitive search for talent’ (p. 31).
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? Greater flexibility and ease for candidates.
? Broaden the applicant pool.
Lastly, beyond individual company websites there are other commercial websites,
such as http://www.traveljobz.net/, which aims to allow job seekers to access
jobs in a wide variety of travel and hospitality jobs, including airlines, hotels, cruise
lines, restaurants and other travel companies.
We recognized earlier in the chapter how a key aspect of recruitment and selec-
tion was cost effectiveness. As a result it is not necessarily sensible to use certain
recruitment methods for certain jobs and in reality the aim should be to ensure the
best method to hit the particular target group for a particular job and in a cost effec-
tive manner. The recognition of the need for a contingent approach to recruitment is
apparent from the research outlined in Figure 5.1 (and see also HRM in practice 5.6).
At this juncture in the recruitment process the organization will hopefully
have generated sufficient interest from suitable applicants. In that sense it is
important for organizations to periodically review the recruitment process and
evaluate its effectiveness against this kind of criterion. Additionally, the organization
may also want to consider the issues of costs and equal opportunities issues.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 102
Local press
Word of mouth
Employment agencies
Trade press
National press
Personnel consultants
Others*
*Others represented internal sources and in one chain an in-house recruitment
centre.
Reprinted by permission from ‘Personnel management in hotels – an update:
a move to human resource management?’, Kelliher, C. and Johnson, K. (1997).
Copyright John Wiley and Sons Limited.
Job centre
30
35
57
66
24
42
22
13
Management (%)
80
70
32
26
8
2
22
87
Operative (%)
Figure 5.1 Sources of recruitment in the hospitality industry
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Ultimately in evaluating the process of recruitment organizations can ask them-
selves several key questions:
? Do recruitment practices yield sufficient numbers of suitable candidates to
enable the organization to select sufficient numbers of high-quality employees?
? Could a sufficient pool of suitable candidates be attracted using less expensive
methods?
? Are recruitment methods fulfilling equal opportunities responsibilities?
Depending on the type of job, and presuming that there is more than one candi-
date, the final part of the recruitment procedure is the notion of shortlisting. The
outcome of the recruitment process is to produce a shortlist of candidates whose
background and potential are in accordance with the profile contained in the person
specification/competency framework. Clearly this is a way of making good use of
the information gathered to date about the candidate. We can also appreciate the
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HRM in practice 5.6 ‘Realistic’ recruitment
in the cruise industry
Raub and Streit (2006) recognise that, as within other tourism and hospitality settings,
human resources are crucial to success in the cruise industry as guests are in constant con-
tact with service staff and unlike conventional hotels cannot usually wander ‘off site’.
Regardless of the likely pressure that this is likely to create for front-line service staff many
people might think that working in the cruise industry is likely to be exciting and fun. Life
on board a cruise ship though can be difficult for staff, for example they are likely to face
cramped and difficult living conditions. The unique work context in the cruise ship indus-
try means that many organizations attempt to offer a ‘realistic’ and ‘honest and objective’
view of working life in the industry, which means that staff do not have an unrealistic view
of working in the industry. Key to this approach is the use of several types of recruitment
media such as interviews, company-specific videos, company presentations, written infor-
mation (such as fact sheets) and web-based information. This realistic job preview is
placed alongside the positive aspects of the job, for example the manner in which work-
ing on cruise ships can significantly broaden the professional and individual horizons of
young employees. By balancing both positive and negative aspects of working in the
industry in this realistic manner companies seem to be able to lessen high levels of labour
turnover thus increasing retention and potentially enhancing job satisfaction.
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need to ensure that things have gone smoothly so far. In this sense if there has been
a problem, say with the advert, shortlisting can conceivably be a problem. If, for
example, there are insufficient number of candidates who are appointable or
indeed if there are too many candidates. Presuming that there are sufficient num-
bers of suitably qualified people for the position the conventional method is to
shortlist by comparison with the person specification/competency framework.
Torrington et al. (2005) though note that if there is a large number of people who
have applied for a job there may be fairly arbitrary criteria, such as people being
excluded because of their age or their handwriting style. As they recognize though
such shortlisting techniques are wholly unsatisfactory, being potentially both
unlawful and certainly unfair. Afairer approach is likely to be based on a rigorous
and systematic view of each candidate via five stages (Torrington et al., 2005: 136):
1 Essential criteria for shortlisting.
2 Individual selectors produce their own list of a given number of candidates.
3 Selectors reveal list and try to reach consensus, if still not clear.
4 Discuss why certain candidates are preferred and others not.
5 Produce final shortlist after negotiation and compromise.
We have now reached the stage where the organization is ready to move on to
selection.
Selection
To-date in this chapter we have essentially been examining the notion of recruitment
and how organizations attempt to attract the interest of potential employees. We can
now go on and examine the idea of how organizations match potential employees to
jobs, via the processes of selection when organizations will decide who is the most
appropriate person for the job. We will do this by contextualizing the process, and
then go on and look at some of the techniques utilized by organizations in selecting
new employees. We will then assess some of the possible problems within this process
and finally examine the way most organizations approach the idea of selection.
As Heery and Noon (2001: 320) note selection is, ‘the process of assessing job
applicants using one of a variety of methods with the purpose of finding the most
suitable person for the organization’. Increasingly many writers argue that the
selection of staff may well be the most important aspect of HRM as staff are
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increasingly expected to become effective immediately. Allied to this point is the
cost of various selection techniques which means organizations will want to get it
right first time. However, despite this recognition there is no one best way which
is universally recognized as the best method of selecting the right person for the
job. Torrington et al. (2005: 141) argue that, ‘the search for the perfect selection
method continues, in its absence HR and line managers continue to use a variety
of imperfect methods’. What this quote points to is that no one selection method
can guarantee success in terms of choosing the right person for the job, especially
given the level of human involvement in the process. As organizations recognize
this conundrum they are adopting a variety of techniques to address questions of
selection. Thus, the methods selected are influenced by the employer’s view of
what is required to provide a satisfactory basis for decision-making and awareness
of the appropriateness of particular techniques to provide what is sought. Before
we go on though and examine various selection techniques in detail it is important
to recognize two points which complete the context of the selection process.
The first idea is that the selection process is a two-way process. Often the per-
ception is that the organization has all of the power in the process of selection.
However, this is not strictly true, even though it may seem that way when you are
going through the process. Selection is in fact a two-way process, because people
have the option to pull out of the process or turn down a job. For example, a major
international hotel company may advertise a graduate trainee scheme and get an
initially good response, such that over 300 application packs are sent out to poten-
tial employees. Of those only 127 are returned. Following the selection process
23 are offered jobs, 19 accept the offer and only 15 actually start with the company.
What this example illustrates is that selection may also be occurring from the
employees’ point of view, especially when the labour market is buoyant or their
particular skills are in demand. The second point is the selection criteria. Selection
does not take place in a vacuum, there is also the context of whether the person
will fit in with the job requirements, so the person/job interaction is important. As
we have already noted there is also the question of whether the person will fit in
with the group or work team or department and will they be able to work with col-
leagues. Finally there is the question of whether the person will fit in with the
organizational culture and the way things are done in a particular organization.
The ways organizations attempt to find this out are myriad, and we can examine
some of the techniques that they utilize in the selection process. The first method,
which is the most popular, is that of interviewing.
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Although criticized, for example many argue interviewing is not very good in
predicting actual performance in the job, the interview is usually the central element
of the selection process in many tourism and hospitality organizations. Indeed, the
interview is often characterized as being the third part of the ‘classic trio’ of applica-
tion forms/CVs, references and interview. In that sense for many people their expe-
rience of the selection process will be filling in an application form, including
supplying two references and then going along to an interview. As far as selection
methods are concerned the interview is seen as the most straightforward and least
expensive approach and what most candidates would expect. Employers in the UK
often express concern about the fairness of psychometric testing and yet continue to
use and seem relatively happy about interviews, despite the potential for bias and
discrimination. The interview remains popular then despite poor evidence of valid-
ity and the fact that other methods have more predictive power in terms of job per-
formance. Regardless of the latter points the interview remains enduringly popular
as a selection tool, with 71 per cent of private service sector organizations using it as
part of the selection process (CIPD, 2004). Although increasingly more sophisticated
techniques are emerging, such as psychometric testing and assessment centres, they
are in addition to rather than replacing the interview.
Riley (1996) feels that the interview is sometimes unfairly criticized because too
much is expected of it, and it is also done badly. Equally, he also makes the point that
it is quick, convenient and when done well, an effective selection method. Riley
(1996) describes the interview as ‘Aconversation with a purpose’ and that purpose
is to assess four objectives:
1 To decide if an applicant is suitable for a job.
2 To decide if the person will fit into the existing work group or organization as a
whole.
3 To attract applicants to the job.
4 To communicate essential expectations and requirements of the job.
Review and reflect
Think about an employment interview that you have attended and whether you felt it was
a ‘good’ or ‘bad’ interview and what influenced your judgement, either positive or negative.
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Essentially then the interview process is about gathering information which
allows for an evaluation of the appropriateness of the individual for a particular
job. Interviews can either be one to one, sequential or phone and again is it likely
that for the majority of positions in tourism and hospitality the first type will pre-
dominate. To have a good interview regardless of which type it is, it is also
suggested that certain conditions should be met (Torrington et al., 2005). These
conditions are concerned with aspects such as attention being paid to noise levels,
avoiding interruptions, lighting, dress and manner of the interviewer, positioning
of furniture and attempts to create an informal atmosphere. These aspects are con-
cerned with taking away as much of the anxiety of the situation as is possible to
ensure interviewees perform to the best of their ability. Recognizing this point
there are several things which should be recognized in interviewing (IRS, 2000,
2006; Torrington et al., 2005: 201–215):
? Interviewers should only talk around 20 per cent of the time, the remaining
time should be filled by interviewees.
? Open questions are more useful, so questions starting with what, why, when,
which and how can be very useful to elicit information from candidates. For
example, instead of asking a question like ‘Did you enjoy your last job?’ the
interviewer could ask ‘What did you enjoy about your last job?’
? Interviewers recognize and like candidates from similar backgrounds to them,
in terms of things like social class and educational background.
? It is estimated that interviewers often make their decision within the first
4–9min of an interview.
? Interviewers are vulnerable to prejudices with regard to aspects such as sex,
race and age.
? Interviewers are affected by physical cues, for example spectacles equals
greater intelligence.
? Interviewers need to be aware of the ‘halo’ or ‘horns’ effect, when either in a
positive or negative manner, some trait or personal characteristic influences or
overwhelms all other thoughts.
? There is a need to recognize the importance of non-verbal communications, or
what is commonly described as body language. For example, interviewers and
interviewees should aim to be open in their stance and throughout the inter-
view sustain animated, yet controlled body language.
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Despite the many criticisms of the interview as a selection method it remains
extremely popular. It is worth remembering as well that often many of the criti-
cisms are largely about the interviewers themselves and not the process. As
Watson (1994: 211) aphoristically notes, ‘employment interviewing is like driving.
Most people rate themselves highly; the consequences of mistakes can be serious
and when something goes wrong there is a tendency to blame the other party’.
Similarly, Taylor (1998: 130) has suggested that, ‘individuals will not tolerate criti-
cisms of their performance as lovers, drivers or interviewers, since all such criti-
cisms strike deep into the core of the human ego’. As Riley (1996) argues although
interviews are subjective and require judgement so do other management activi-
ties and the real problem is not the interview but the way it is carried out. To con-
clude it is worth noting the view of IRS (2000: 12) who suggest that, ‘there are few
more complex, intuitive, intelligent or sophisticated information processors than a
competent and confident interviewer’. With the interview set to continue as an
integral part of the selection process it is important for individual managers to rec-
ognize the need to develop their interviewing skills as an essential part of their
managerial skillset.
Beyond interviewing there are a number of other techniques which organiza-
tions can conceivably utilize in selecting employees. An obvious aspect to this is
the use of tests and psychometric testing. In general a test may refer to something
like a dexterity test for a manually skilled employee or an attainment test, for
example typing skills. More specifically, psychological or psychometric tests are
tests which can be systematically scored and administered. These tests are used to
measure individual difference in aptitude, ability, intelligence or personality.
Organizations are increasingly using these types of tests, particularly for manage-
rial positions (IRS, 2002). That said, psychometric tests are a source of great debate,
particularly the use of personality tests. Much of this debate is concerned with
whether tests of this nature can genuinely predict future workplace behaviour.
Aptitude tests may test specific abilities in relation to verbal, numerical, spatial or
mechanical skills to provide an indication of how well applicants will cope with
the job. General ability or intelligence tests are used to test how well individuals
think on their feet and will be about analytical reasoning and ability to think criti-
cally. The most controversial tests are personality tests, which are often described
as Orwellian or biased, manipulative and intrusive as they attempt to assess how
people will cope with demands, or how people will cope with stress, rigidity or
attitudes to authority or creativity.
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There are a number of issues which arise in the use of personality tests. For
example, there are concerns about how comparable information is. Equally, there are
major concerns expressed by bodies such as the Equal Opportunities Commission
and Commission for Racial Equality about the gender and ethnic bias in tests (IRS,
2002; LRD, 2003). Lastly, a number of occupational psychologists have expressed
concerns at so-called off the shelf models, which may be used in organizations in an
inappropriate manner and may be, in the words of one personnel specialist, ‘no
more reliable than a Cosmopolitan-style questionnaire’ (cited in Sappal, 2005: 40). In
sum, rather like many of the other selection methods described above the proper use
of psychometric testing can help organizations make objective and more reliable
selection decisions as long as they are used in an appropriate manner and adminis-
tered properly.
Other methods which could be used by tourism and hospitality organizations
include things like presentations. For example, an applicant for a training manager’s
job is likely to be required to give numerous presentations and the organization may
want to assess their presentation skills. Organizations may also use various group
methods such as which often involve problem-solving. These activities may involve
some element of role playing. By undertaking such problem-solving in small groups
applicants will have the opportunity to demonstrate things like ability to work
within a group, creativity, interpersonal skills and so on. One final method is the so-
called in-tray exercise which will simulate an in-tray of a manager and the applicant
has to go through the tray and make decisions on the problems that they find.
Finally we come to the last method of selection, the assessment centre, which
ordinarily refers to a process rather than a physical centre. Assessment centres uti-
lize a mix of all of the above techniques and due to the opportunity to use a vari-
ety of methods – all of which are potentially assessing different aspects of the
candidates – they are often described as the ‘Rolls Royce’ of selection methods
(IRS, 2005). In this sense they are widely considered the most objective and best
predictive selection tool for future performance. Equally, though, we should also
recognize that assessment centres are also complex to design, time consuming and
costly meaning that they are often, though not exclusively, reserved for appointing
managerial- or graduate-level staff (and see HRM in practice 5.7).
In order for the overall process of recruitment and selection to be considered
successful it is important that it is considered fair by candidates, is cost effective, is
user friendly, acceptable to both the organization and the candidates, and is
reliable and valid. The reliability of a selection process refers to the extent to which
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a selection technique achieves consistency in what it is measuring over repeated
use. Validity can be seen in three different ways. First, face validity on refers to the
issue of whether the selection procedure was seen to be valid to candidate and
tester. Face validity can be particularly important in terms of organizations being
able to attract good candidates in the future. Second, predictive validity is con-
cerned with whether the outcome selection able to predict the ability to perform
effectively when in post. Lastly, content validity is about ensuring that the test or
exercise in assessing certain skills is actually relevant to the job in question.
Once the selection procedure is over there is also a need for organization to
ensure that there is feedback to both the successful and unsuccessful candidates.
Organizations should aim therefore to give feedback as soon as possible. It is also
important to recognize that for the feedback to be meaningful it should be specific
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 110
HRM in practice 5.7 The use of
assessment centres by easyJet
IDS (2002) notes that as a major airline easyJet is concerned to get it right in recruiting staff,
especially pilots, who are one of the company’s most expensive resources in terms of salary,
training and career development. The assessment centre for pilots was introduced in 1999
and has now been extended to the recruitment of cabin crew and call centre employees.
The assessment centre for pilots is particularly demanding, covering 2 days. Potential pilots
face a range of challenges which aim to assess aspects such as team-working, ability to
cope under pressure, ability to adhere to standards and technical knowledge. Additionally,
Captains who attend the assessment centre are also assessed against leadership and
decision-making criteria. Day 1 of the assessment centre is largely concerned with a range
of tests and activities such as group work, personality tests and interviews. If the applicants
successfully get through day 1 they progress to day 2. The second day is a flight simulation
exercise which assesses the candidate’s basic handling skills, as well as broader aspects such
as flight management and crew resource management skills.
Cabin crew undertake a 1 day assessment in which the company evaluates potential
employees against a number of competencies, including conscientiousness, sense of
urgency, initiative, empathy, self-confidence and enthusiasm. To assess these aspects can-
didates have an ice breaker and the ‘easyJet test’. The test measures things like mathemat-
ical ability, knowledge of easyJet and other factors relevant to the job, for example
knowledge of foreign currencies.
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as opposed to being too vague to allow candidates to fully appreciate why they
did not get the job. Abenefit from giving constructive feedback is that at the end of
the recruitment and selection process the organization is still maintaining a posi-
tive image. Rather like much of what we have previously discussed the provision
of feedback is an essential part of how organizations can portray themselves in a
positive manner throughout the recruitment and selection process.
Conclusion
Clearly tourism and hospitality organizations are faced with a mass of possible
methods and techniques in which to approach the question of recruitment and selec-
tion. As we described in the introduction there is no one best way to recruit and
select. Instead, organizations should be prepared to develop a contingent approach.
On the one hand this may simply mean employing people on the basis of word of
mouth or because they responded to an advert in the window of a restaurant, for
example. On the other hand it may be the culmination of a lengthy and expensive
selection process, particularly for managerial and graduate-level positions.
In answer to the question of whether there has been significant change in
recruitment and selection in the tourism and hospitality industry in recent years the
answer would be yes and no. Yes in terms of a shift to organizations looking for the
‘right’ people in terms of attitudes and behaviour and adoption of more sophisti-
cated techniques, such as psychometric testing. Equally, though, we could also
answer no in terms of the widespread use of traditional forms of recruitment and
selection, such as interviewing. Moreover evidence continues to suggest that the
recruitment and selection process in many tourism and hospitality organizations
often remains ad-hoc and informal, especially for operative and front-line positions.
References and further reading
Armstrong, M. (1999) A Handbook of Human Resource Management Practice, Kogan Page, 7th edition.
Baker, J. (1999) ‘Friday’s people’, Caterer and Hotelkeeper, 28 January, 30–31.
Beal, B. (2004) ‘Psychological search for Hilton hotel managers’, Human Resource Management
International Digest, 12(1), 30–32.
Chan, B. and Coleman, M. (2004) ‘Skills and competencies needed for the Hong Kong hotel industry: the
perspective of the hotel human resources manager’, Journal of Human Resources in Hospitality and
Tourism, 3(1), 3–18.
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Chartered Institute of Personnel and Development (2004) Recruitment, Retention and Turnover: A Survey
of the UK and Ireland, CIPD.
Chartered Institute of Personnel and Development (2006) The Guide To Recruitment Marketing, CIPD.
Gallier, E. (2004) ‘When the going gets tough’, Hospitality, June, 35.
Heery, E. and Noon, M. (2001) A Dictionary of Human Resource Management, Oxford University Press.
Hills, R. (2004) ‘Who would you most like to be stuck in a lift with?’, Sunday Herald, 23 May, 12.
Income Data Services (2002) Assessment Centres, IDS Studies No. 735, September.
Industrial Relations Services (2000) ‘The interview: its role in effective selection’, Employee Development
Bulletin, No. 122, February, 12–16.
Industrial Relations Services (2002) ‘Psychometrics: the next generation’, IRS Employment Review, No. 744,
28 January, 36–40.
Industrial Relations Services (2005) ‘Centre of attention’, IRS Employment Review, No. 816, 28 January,
42–48.
Industrial Relations Services (2006) ‘In the hiring line: boosting managers’ recruitment skills’, IRS
Employment Review, No. 846, 5 May, 42–48.
Jackson, M., Goldthorpe, J. and Mills, C. (2005) ‘Education, employers’ and class mobility’, Research in
Social Stratification and Mobility, 23, 1–30.
Jameson, S. (2000) ‘Recruitment and training in small firms’, Journal of European Industrial Training,
24(1), 43–49.
Kelliher, C. and Johnson, K. (1997) ‘Personnel management in hotels – an update: a move to human
resource management?’, Progress in Tourism and Hospitality Research, 3(4), 321–331.
Labour Research Department (2003) ‘Employers warned over bias in aptitude tests’, Labour Research,
December, 25.
Lockyer, C. and Scholarios, D. (2005) ‘Selecting hotel staff: why best practice does not always work’,
International Journal of Contemporary Hospitality Management, 16(2), 121–135.
Marchington, M. and Wilkinson, A. (2005) Human Resource Management at Work: People Management
and Development, CIPD, 3rd edition.
Nickson, D., Warhurst, C., Cullen, A.M. and Watt, A. (2003) ‘Bringing in the excluded? Aesthetic labour,
skills and training in the new economy’, Journal of Education and Work, 16(2), 185–203.
Nickson, D., Warhurst, C. and Dutton, E. (2005) ‘The importance of attitude and appearance in the service
encounter in retail and hospitality’, Managing Service Quality, 15(2), 195–208.
Nickson, D., Warhurst, C., Witz, A. and Cullen, A.M. (2001) ‘The importance of being aesthetic: work,
employment and service organization’, in A. Sturdy, I. Grugulis and H. Wilmott (eds.) Customer Service –
Empowerment and Entrapment, Palgrave, 170–190.
Price, L. (1994) ‘Poor personnel practice in the hotel and catering industry – does it matter?’, Human
Resource Management Journal, 4(4), 44–62.
Raub, S. and Streit, E. (2006) ‘Realistic recruitment: an empirical study of the cruise industry’, International
Journal of Contemporary Hospitality Management, 18(4), 278–289.
Sappal, S. (2005) ‘Top scorers’, People Management, 13 January, 38–40.
Smethurst, S. (2004) ‘The allure of online’, People Management, 29 July, 38–40.
Taylor, S. (1998) Employee Resourcing, IPM.
Torrington, D., Hall, L. and Taylor, S. (2005) Human Resource Management, Prentice Hall, 6th edition.
Warhurst, C. and Nickson, D. (2001) Looking Good, Sounding Right, Industrial Society.
Watson, T. (1994) ‘Recruitment and selection’, in K. Sisson (ed.) Personnel Management: A Comprehensive
Guide to Theory and Practice in Britain, Blackwell, 185–220.
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Websites
The Advisory, Conciliation and Arbitration Service (ACAS) has a useful publication on recruitment, which is
available at http://www.acas.org.uk/index.aspx? articleid?526&detailid?584
The Chartered Institute of Personnel and Development (CIPD) has a very informative factsheet on recruitment
which can be found at http://www.cipd.co.uk/subjects/recruitmen/general/recruitmt.htm?IsSrchRes?1
There are a variety of different links covering recruitment and selection at http://www.hrmguide.co.
uk/hrm/chap8/ch8-links.html
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Chapter 6
Equal opportunities
and managing diversity
Chapter objectives
This chapter reviews the nature of equal
opportunities and managing diversity in the
tourism and hospitality industry. The main
objectives of this chapter are to:
? Appreciate the differing aspects which drive
approaches to equality and diversity.
? Consider the employment experience of socially
defined minority groups.
? Discuss the role of legislation in attempting to
create greater equality.
? Recognize the importance of managing
diversity as a more business-oriented approach
to equality.
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EQUAL OPPORTUNI TI ES AND MANAGI NG DI VERSI TY 115
Introduction
Increasingly when we look at adverts for positions in tourism and hospitality organ-
izations we will see the statement that the employing organization is ‘an equal
opportunities employer’. Does this mean then that we are likely to find equality of
opportunities within organizations? Have we managed to get rid of discrimination?
Have we got a just society where sex, race/ethnicity, disability, age, religion and sexu-
ality are no more important than eye colour? Is there equality in relation to issues
such as recruitment and selection, training and development, remuneration, career
development and promotion? It is these and other questions which we will consider
in this chapter. Specifically we will recognize how certain social groups may experi-
ence disadvantage in the workplace, regardless of their qualities and abilities. The
manner in which organizations are seeking to address the issue of equal opportun-
ities may vary considerably and here it is helpful to recognize the useful distinction
offered by Goss (1994) with regard to the issue of equal opportunities. Goss makes a
distinction between what he terms a ‘short’-term compliance agenda, and a much
more proactive ‘long’-term agenda. The former agenda is driven largely by the idea
of complying with legislation to avoid penalties. For example, there is no upper limit
on compensation awarded by an employment tribunal in discrimination cases and
whether an employer unintentionally discriminates is no defence. Clearly, this type
of agenda is driven by organizational self-interest. In contrast, the long-term agenda
is premised on notions of efficient management of human resources, creating a good
organizational image, managing diversity and social justice, though some of these
aspects may, in reality, also be in the organization’s self-interest. In many respects
then we can think of equality and diversity in terms of:
? Legal aspects: failure to comply with legislation in this area can mean employers
facing unwelcome publicity and potentially large payouts as a result of employ-
ment tribunal decisions.
? Ethical aspects: it is ethically and morally right for organizations to seek to offer
equality of opportunity to all.
? Business aspects: it makes good business sense to encourage equality and diver-
sity to ensure the organization draws on the widest possible labour market to
make sure that they are maximizing the best use of all available resources.
Equality also makes good business sense in terms of potentially widening the
customer base and also portraying a positive company image.
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Of course, in reality, the approach to equality and diversity adopted by organiza-
tions may well be informed by all of these aspects. Increasingly though within a
more strategic HRM approach it is suggested that many organizations are recog-
nizing the business case for equality and diversity.
Stredwick (2005) suggests that support for the business case is strengthened
by recognizing three key issues. First, is the need to recognize demographic
changes. With a declining birth rate traditional sources of labour (young, white,
qualified and full-time) are in decline so organizations need to think about finding
alternative sources of labour. Second, the changing nature of the workplace and
specifically the shift from manufacturing to service employment means more and
more women are entering the labour market. Consequently organizations have to
respond to this change by ensuring they encourage the best applicants through
enhanced career opportunities and a supportive environment for all. Lastly, with the
shift to a service economy there is now a greater emphasis on customer relations,
especially in an ever more competitive environment. By pursuing active approaches
to equality and diversity management organizations not only offer opportunity to all
segments of the labour market, but may also broaden their customer base by demon-
strating such a commitment. That said, discrimination still remains a very real issue
within society generally and workplaces specifically, so the chapter will now move
on to consider steps which may be taken to eradicate discrimination in all its forms.
The employment experience of socially
defined minority groups
Agood starting point to further consider the issue of equal opportunities is to rec-
ognize some of the barriers that may effect the employment of certain groups of
workers, initially considering women, black and minority ethnic people, people
with disabilities and older people.
Women
Across the economy as a whole, women now make up 46 per cent of the workforce,
though nearly half of all women working work part-time (EOC, 2005). Despite
making up nearly half of the workforce women still remain under-represented in
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senior and middle management positions. For example, across the economy as a
whole although there is now greater representation of women in the boardroom
of Britain’s leading companies, women still remain ‘woefully under-represented’
according to Cranfield University’s annual survey of women in senior management
positions (Cranfield University, 2004). There is also continuing disparity in women’s
pay, relative to men, with women earning around 82p for every £1 earned by men
(EOC, 2005).
These disparities in the economy as a whole are also seen in the tourism and
hospitality industry. Although women account for 70 per cent of employees, there
are no female chief executives in the FTSE 350 travel, leisure and tourism companies
(Rossiter, 2005). Indeed, more generally across Europe travel and leisure has the low-
est level of boardroom representation with no representation at all compared to sec-
tors like household goods and services where 18.9 per cent of boards are made up by
women (EPWN, 2006). Moreover although the number of women managers in
tourism and hospitality is significantly higher than many other industries, it still
remains disproportionately low given the overall level of female representation
within the workforce (Mayling, 2003). Women may also face particular barriers in
the workplace in the tourism and hospitality industry, including (HCIMA, 1999):
? Lack of childcare provision.
? Difficulties of the dual role in maintaining a management career and caring for
children and other dependents.
? Lack of flexible, part-time opportunities at higher levels in the industry.
? The macho atmosphere in certain workplaces, such as the kitchen.
? Sexism and sexist attitudes.
? Poor career planning.
? Shortage of positive female role models.
There are a number of ways in which organizations can begin to address some of
these issues and HRM in practice 6.1 presents an example of a proactive response
to encouraging women’s employment.
Black and minority ethnic people
A recent report from the Cabinet Office (2003) noted that members of ethnic
minorities are more than twice as likely to be unemployed even when age, sex and
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level of qualifications are taken into account. Significantly the same report also notes
how this disparity in employment has changed little over the last 18 years. This lack
of economic activity is particularly pronounced in men from ethnic backgrounds aged
16–24 years. On the question of the progression of black and minority ethnic workers
to middle and senior management positions a recent report by the Runnymede Trust
(2000) found that only 1 per cent of senior managers and 3 per cent of junior managers
were from an ethnic minority, despite the fact that ethnic minorities make up 8 per
cent of the population as a whole. Similarly, a recent report from Cranfield University
found that just 2.3 per cent of board members in the largest companies listed on the
London Stock Exchange came from ethnic minority backgrounds (Smith, 2005). When
ethnic minority employees are employed it is noteworthy that they tend to be con-
centrated in terms of occupational segregation, with a large number employed in the
hospitality sub-sector in particular. For example, LRD (2005) notes that 52 per cent of
Bangladeshi workers work in the restaurant industry compared with only 1 per cent
of white males. In addition, LRD (2005) also notes a disparity in pay, with this ‘black
pay gap’ meaning in some instances that workers from some communities earn an
average of £7000 less than white workers.
As we have already noted the black and minority ethnic communities make
up around 8 per cent of the UK’s population and significantly will account for half
HRM in practice 6.1 Opportunity Now:
A proactive response to gender equality
Opportunity Now was originally set up as Opportunity 2000 in October 1991. Its aim was
to increase the quality and quantity of women’s participation in the workforce.
Membership is open to any organization, large or small and by June 2005 over 350 organ-
izations, including British Airways and Jurys Inn’s, had signed up. Those organizations join-
ing Opportunity Now commit themselves to overcoming the barriers to recruitment,
retention and development of women. Opportunity Now provides advice to employers
and shares information on best practice in areas such as developing flexible working
arrangements, improving childcare, career break options and training and education to
increase women’s opportunity at work. To further help organizations Opportunity Now
also runs a benchmarking exercise on gender equality, which helps employers to chart
progress whilst at the same time providing a checklist for organizational change.
Derived from IDS (2003); Opportunity Now (2005).
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the growth of the working age population in the decade 1999–2009 (LRD, 2005).
Consequently, there is a need for organizations to be proactive in their attempts to
promote racial equality. IDS (2001) suggest a number of practical steps which can
be taken by organizations, including:
? Ensuring fair recruitment practices, such as recruitment schemes targeted at
ethnic minority employees and targeted advertising to encourage more appli-
cants from under-represented groups.
? Using images of ethnic minority employees in publicity and advertising material.
? Developing links with ethnic minority communities (often as a way of attracting
new employees).
? Undertaking ethnic monitoring.
? Ensuring HR policies are in place to help foster and protect a diverse work envir-
onment (e.g. dignity at work and harassment policies).
? Accommodating different religious beliefs in the multicultural workforce.
? Introducing diversity awareness training (particularly for managers).
? Setting up internal networks for ethnic minority employees.
? Taking positive action on training and development.
There has also been a similar type of initiative for black minority ethnic employees
as Opportunity Now. Launched in October 1995, Race for Opportunity (RfO) is a
business-led initiative organized by Business in the Community and aims to put
race and diversity issues higher up the business agenda, by investing in the UK’s
ethnic communities. RfO publishes an annual benchmarking report which assesses
organizations in five key ‘impact’ areas, including leadership, community involve-
ment and supplier diversity (IDS, 2006).
Disabled employees
Often our perception is that disability is likely to mean that a person is in a wheel-
chair or visibly impaired. However, of the 8.7 million adults who are registered
disabled only 600,000 are in a wheelchair (Anon, 2004). Moreover 2.4 million are of
working age and over 70 per cent of this figure are economically active or looking
for work. In reality this means that a significant number of disabled people are
thought to want to work. It is also instructive to note that 70 per cent of disabled
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people who are economically active or looking for work became disabled while in
work (LRD, 2000). Thus there would seem a strong moral argument that employers
should aim to help disabled people back into the labour market. In a similar vein to
Opportunity Now and RfO there is also an attempt to be positive about disabled
workers with the ‘two-ticks’ scheme. Under this scheme any employers using the
two-ticks must (LRD, 2003):
? Interview all applicants with a disability that meets the minimum for a job
vacancy.
? Ask disabled employees at least once a year what can be done to ensure they
can develop and use their abilities at work.
? Make every effort when employees become disabled to ensure they stay in
employment.
? Take action to ensure that key employees are aware of the needs of disabled
people.
? Each year review achievements towards making the workplace welcoming and
accessible for disabled people, plan ways to improve and let all employees and
customers know about this progress and future plans.
Whilst the two-ticks campaign is important to changing workplaces practices,
campaigners for the disabled are also attempting to shift perceptions about
disability (and see HRM in practice 6.2).
HRM in practice 6.2 Perceptions of disability
A letter to People Management in 1997 from a representative of Capability Scotland noted
how language used to describe disability often shapes attitudes and perceptions. The
author of the letter notes how often people with disabilities are described as ‘suffering’
from the disability, which can lead to misconceptions such as the amount of time they are
likely to take off work. The letter also suggests preferred terminology to ensure that people
are aware of using pejorative terms like: the disabled, normal, mentally retarded and
confined to a wheelchair. The preferred terms are people with disabilities, able-bodied,
learning difficulties and wheelchair users.
Source: Bald (1997).
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Older workers
Hope (2005) reports that the National Audit Office estimated that cost of stereotyping
on the basis of age costs the UK economy £31 billion a year in lost contributions. For
older workers it can be especially difficult to gain a new job, especially once they are
over 45 years. Arkin (2005: 32) notes how some of the ‘ridiculous comments’ about
older workers have the ring of comments which were often made 30 years ago with
regard to sex and race discrimination. For example, he notes that prior to the intro-
duction of the Race Relations Act (RRA) in the 1970s some people argued that
employing someone from an ethnic minority in a shop would put customers off.
Certainly such attitudes have been prevalent in the tourism and hospitality industry,
with one well known restaurateur once famously suggesting that:
I fail to understand why employers ought not to be able to discriminate about
potential employees on the basis of age, at least for those who are in contact
with the public. We are in a business where image counts as much as content.
Of course, it is unfair to turn down older people with the required technical
skills to do the job, but so what? It is not a perfect world (Gottlieb, 1992: 20).
Work by Qu and Cheng (1996) who surveyed 26 hotels in Hong Kong and Magd
(2003) who interviewed 21 managing directors in small and medium sized hospi-
tality enterprises in the UK is useful to appreciate how older workers tend to be
perceived within tourism and hospitality. From a positive point of view the research
suggests that employers tend to see older workers as having: low absenteeism,
fewer accidents, low turnover rate, being motivated, hard working and diligent,
having a sense of responsibility, good communication skills and credibility with
customers. On the other hand, the research also revealed that older workers were
perceived as inflexible and reluctant to change, have low productivity, find it hard
to adapt to new technology and have difficulties in keeping up with the speed of
work. Whilst most age-related discrimination is directed towards older workers,
younger workers too can be affected. Smethurst (2004) reports research from the
Review and reflect
To what extent do you agree with Gottlieb’s sentiments and why?
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CIPD which notes that the optimum age in the workplace to be judged as neither
too old or too young is 35–40 years. For those under 35, 8 per cent of people had
reported being discriminated against for being too young.
The legislative response
The above discussion gives us a sense of some of the issues affecting certain
groups of employees. We can now move on to consider how these have been
addressed, beginning with the emergence of equal opportunities legislation. There
have been a number of laws introduced in the UK which have sought to address
the problems of discrimination generally and specifically to reduce such discrim-
ination in the labour market and the workplace.
Whilst legislation has now existed for over 30 years we should recognize that there
is much debate about whether the legislation has been successful, and whether it has
simply been embraced as rhetoric but without much success in implementation. For
example, many believe that legislation cannot by itself eradicate a whole range of
attitudes, which may encourage discriminating behaviour. On the other hand, whilst
recognizing that the law cannot change attitudes overnight, it can, and does, effect
change slowly. Some people would argue that it has in fact been too slow and its
effects have been patchy. In that sense the law requires an end to discrimination; it
does not actually require that employers do anything to promote equality. Related to
this point there is also the distinction made by many commentators about the differ-
ences between the letter and spirit of the law. The former encourages a narrow inter-
pretation of law, which may not be in the best interests of encouraging a more
proactive approach to equality and diversity. The latter is potentially more flexible in
offering the scope for decisions which encourage greater equality.
Having briefly contextualized the emergence of the legislative agenda we
can now go on and examine the actual provisions and what they mean for organ-
izations, starting with Table 6.1, which summarizes the range of anti-discriminatory
legislation.
Review and reflect
How successful is legislation likely to be in addressing equality issues?
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Table 6.1 Anti-discriminatory legislation
Act Areas covered
Sex Discrimination Act 1975 Sex and marital status (the latter referring
specifically to persons who are married)
Sex Discrimination (Gender Reassignment) Persons who intend to undertake a sex
Regulations 1999 change, are currently in the process of
doing so or have completed treatment
Employment Equality (Sex Discrimination) Introduced a new definition of indirect
Regulations 2005 discrimination and added specific
definitions covering discrimination on
grounds of harassment
Race Relations Act 1976 Race, colour nationality, national or ethnic
origin
Race Relations (Amendment) Act 2000 The duty of public authorities to take
positive action to promote good race
relations
Disability Discrimination Act 1995 Disabled persons
Disability Discrimination Act (Amendment) Removal of the exemption for employers of
Regulations 2003 fewer than 15 people; shift in the burden
of proof
Disability Discrimination Act 2005 Those with progressive conditions such as
HIV and cancer will be treated as disabled
from the point of diagnosis. Those with
mental illness are no longer required to
have their illness clinically recognized
Employment Equality (Sexual Orientation) Orientation towards persons of the same
Regulations 2003 sex, of the opposite sex, of both the same
sex and the opposite sex
Employment Equality (Religion or Belief) Religion or similar beliefs
Regulations 2003
Rehabilitation of Offenders Act 1974 Persons with ‘spent’ convictions
Human Rights Act 1998 Prohibition of forced labour and slavery;
right to respect for private and family life
(inter alia)
Derived from LRD (2006).
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The Sex Discrimination Act (SDA) and RRA are particularly important in
denoting the first systematic attempt to address discrimination. Both acts refer to
the idea of direct and indirect discrimination. Direct discrimination is where
employees of a particular sex, race or ethnic group are treated less favourably than
other employees. For example, a policy to only recruit men to management posts.
Indirect discrimination is where a particular requirement apparently treats every-
one equally but has a disproportionate effect on a particular group and the require-
ment cannot be shown to be justified. For example, requiring a kitchen porter to
speak fluent English, which is not a necessary requirement for the job. At present
there are three government sponsored bodies which are responsible for promoting
equality. With regard to sex and race the commissions are the Equal Opportunities
Commission (EOC) and the Commission for Racial Equality (CRE), which were
established in 1975 and 1976, respectively. The EOC and CRE are responsible for
working towards eliminating discrimination, promoting equality of opportunity
and reviewing how the law works. They also issues codes of practice, undertake
formal investigations where there are allegations of discrimination and can, in cer-
tain circumstances, support individual legal claims. With regard to disability, as of
April 2000 the Disability Rights Commission (DRC) has taken on the same role as
the CRE and the EOC (and see the later discussion of the DDA).
Both the SDA and RRA are concerned with prohibiting discrimination in all
areas of employment. For example, during the recruitment and selection process
organizations should unsure that the right message is conveyed in recruitment
advertisements, which as we noted in Chapter 5, should be carefully worded so
that there is no indication that people of some backgrounds are preferred to others.
Equally, in the selection procedure organizations should be wary of drawing up
person specifications that are unjustifiably demanding. As we noted there is also a
need to consider whether certain selection tests may discriminate against people
from minority backgrounds. Only the EOC or the CRE can instigate proceedings
in relation to advertising, but individuals can pursue claims via the employment
tribunal system in all other aspects of employment. The legislative threat centres
on possible adverse publicity to the organization as well as the direct and indirect
costs of tribunal claims or commission investigation. Although in reality a rela-
tively small number of cases actually end up being heard in an employment tribu-
nal. For example, ACAS (2006) notes that it received 9942 cases with regard to either
sex or race discrimination. Of these cases, 3283 were settled before the tribunal,
4267 were withdrawn, 1168 were either struck out by the tribunal or out of scope,
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EQUAL OPPORTUNI TI ES AND MANAGI NG DI VERSI TY 125
leaving only 1224 cases ultimately reaching the tribunal to be heard. Nevertheless
cases which are concerned with discrimination do not carry an upper limit for com-
pensation, so organizations should aim to avoid such cases, which may prove to be
very costly.
Two other points are also important to note with regard to the SDAand RRA.
The first is positive action. Positive action may be confused with what is often
termed positive or reverse discrimination, or what in the US is known as affirma-
tive action. Positive discrimination seeks to redress previous inequality by giving
priority to certain groups in the labour market. For example, an organization
appointing a female candidate to a managerial position primarily because of her
gender, rather than her managerial skills. Currently such an approach is illegal in
the UK, but such approaches have been used in the US and other countries (and
see HRM in practice 6.3).
Whilst positive discrimination is unlawful in the UK, positive action is not. Positive
action may encompass a range of policy initiatives which aim to promote equality
Review and reflect
Outline arguments for and against positive discrimination.
HRM in practice 6.3 Jobs for the girls
Legislation was introduced in Norway in 2002 to ensure at least 40 per cent of boardroom
seats are reserved for women (Osborn, 2002). The decree initially affected state owned
firms, but by 2005 all public companies had to enforce the quota. Whilst equality groups
and trade unions were supportive of the move, employers feared that the initiative would
make Norway uncompetitive and discourage foreign firms from investing in the country
(Walsh, 2004). Indeed, Scandinavian countries generally are trail blazers in increasing the
representation of women on boards. By 2006 Norway had the highest percentage of
women at boardroom level at 28 per cent. Sweden had 22 per cent, Finland 20 per cent and
Denmark 17.9 per cent (EPWN, 2006). These figures can be compared to other selected
European countries such as the UK which had 11.4 per cent, Germany 7.2 per cent, Italy
1.9 per cent and Portugal where there are no women at boardroom level (EPWN, 2006).
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of opportunity through the provision of facilities, procedures or actions that
redress disadvantage suffered by particular groups in the labour market or organ-
ization. For example, under positive action both the SDAand RRAmake it lawful
to encourage and provide training for members of one sex or racial group who
have been under-represented in particular work in the previous 12 months. In
addition advertisements can explicitly encourage applications from one sex or
racial group if that group is under-represented within the organization, though
there are no guarantees that they will get the job.
One final point when we are talking about sex or race discrimination is that of
genuine occupational grounds, where discrimination is permitted due to sex or
race being specified as a Genuine Occupational Qualification (GOQ), which are out-
lined in sections 7(2) of the SDAand 5(2) of the RRA. AGOQ is likely to be based
on things such as authenticity, decency, privacy and the delivery of personal wel-
fare services. For example, a stylish Italian bistro may seek to retain its authenticity
by employing only Italian staff. As we noted above the SDAand RRAare particu-
larly important in being the first attempt to establish a legislative framework and
also with regard to establishing many of the mechanisms which are now being
incorporated in more recent legislative intervention, such as the DDA.
The DDA is similar to the SDA and RRA, though it offers protection only
against direct discrimination. The DDAoffers a broad definition of disability, with
section 1 of the DDA talking of any, ‘Physical or mental impairment which has a
substantial and long-term adverse effect on his (or her) ability to carry out normal
day-to-day activities’. Indeed, LRD (1999) in reviewing a number of employment
tribunal decisions note that there is no definitive list of what amounts to psychical
or mental impairment and employment tribunals are left to decide what may be
considered a disability (and see HRM in practice 6.4).
The DDAinitially made it unlawful for any company which had more than 15
employees to discriminate against employees, job applicants and contractors who
are disabled. Recent changes though now mean that the provisions of the DDAnow
extend to all employers, regardless of size. Within tourism and hospitality there are
many instances where managers may have to consider their response to potentially
sensitive situations under the aegis of the DDA(and see HRM in practice 6.5).
To a large extent the approach to the scenarios outlined in HRM in practice 6.5
will be dictated by the notion of ‘reasonable adjustments’. As we noted above
although the DDA provides protection against direct discrimination with regard
to indirect discrimination employers may set a requirement for use in recruitment
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HRM in practice 6.4 Conditions amounting
to physical or mental impairment
Employment tribunals have taken a wide view of disability and have ruled that all the
conditions below may amount to a physical or mental impairment.
Asthma Bipolar affective disorder
Migraines Cerebral palsy
Photosensitive epilepsy Chronic fatigue syndrome
Visual impairment Colitis
Injuries affecting mobility Congenital myotonic dystrophy
Abdominal pain Deafness
Depression Emphysema
Multiple sclerosis Diabetes
Post-traumatic stress disorder
Whilst these conditions have all been accepted as a disability in tribunal decisions they
should still not be considered as a wholly definitive list. Other tribunals may not consider
them as a disability due to differing circumstances with the individual bringing the case.
More recently under the aegis of the DDA, HIV/AIDS, as well as mental illness and progres-
sive conditions such as cancer have all been formally designated as being part of the act.
Employees will be deemed disabled as soon as these latter conditions are diagnosed.
Derived from LRD (1999); LRD (2006).
HRM in practice 6.5 An appropriate
response to disability?
As a manager think about how you might respond to the following scenarios.
An applicant for a waiting job, who otherwise impresses in the interview, is visually
impaired. There may be some concerns about them tripping over furniture, reading
blackboard menus to customers or dropping plates on laps and so on.
An applicant for a front line position in a travel agency is facially disfigured and you
are concerned about whether their appearance may put off customers.
An applicant for a position as chef who is wheelchair bound.
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or promotion processes which might be held to discriminate against people with
disabilities. In such cases less favourable treatment can only be justified where it is
relevant to the circumstances of the individual case and where the reason for the
treatment is felt to be substantial. This is where the notion of reasonable adjust-
ments becomes important. Employers have to consider whether the less favourable
treatment can be overcome by reasonable adjustments to premises or the employ-
ment arrangements. For example, IRS (2003) notes some of the common adjust-
ments made by employers in response to the DDA, including:
? Allowing absence for rehabilitation and treatment.
? Altering a person’s working hours.
? Acquiring or modifying equipment.
? Adjusting premises.
? Transferring a person to another job.
? Assigning a person to other work.
? Providing a reader and interpreter.
? Providing support workers.
? Modifying instruction manuals.
With regard to the scenarios above, in the case of the chef health and safety con-
siderations would mean that the use of a wheelchair within the kitchen would be
impractical and it would be considered unreasonable to make significant adjust-
ments to the premises. On the other hand, visual impairment is likely to require a
much more proactive response from tourism and hospitality employers (and see
HRM in practice 6.6).
Afurther facet of the DDAwhich is particularly apposite for tourism and hos-
pitality organizations is the need to ensure that employees are aware of the needs of
disabled customers. For example, organizations may develop disability awareness
training in-house or use commercially available options such as IndividuALL’s self-
learning CD-Rom, Welcoming Disabled Guests. IndividuaALLis part of Tourism for
All UK, a national registered charity which aims to provide advice and support to
disabled people and tourism providers to enhance the accessibility of tourism pro-
vision to the disabled.
As can be seen in Table 6.1 it is only recently that discrimination based on sexual
orientation and religion have become explicitly prohibited. There are approximately
1.3 to 1.9 gay and lesbian workers in the UK (LRD, 2003a) and the perception is
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that there is a higher proportion of gay and lesbian employees within hospitality
and tourism. That said, there has been little research that has explicitly addressed
the opportunities and experiences of gay men and lesbians within tourism and
hospitality organizations. More generally, research has pointed to the discrimin-
ation faced by gay and lesbian employees. For example, LRD (2000a) reports a sur-
vey by the TUC which found that 44 per cent of gay or lesbian employees had
suffered some form of discriminatory treatment, most commonly name calling
and homophobic abuse, but in some cases dismissal. Even with the introduction of
legislation in 2003 there still seems to be evidence of continuing discrimination.
For example, recent research suggests that nearly half of gay men and lesbian
women still fear discrimination if they ‘come out’ at work ( Johnston, 2006). As
with much of the other areas of legislation discussed in this chapter the key is for
organizations to think about developing appropriate policies and procedures to
ensure compliance with the legislation. With regard to sexual orientation Ward
(2003) notes how research has highlighted the positive effects on motivation and
job satisfaction for lesbian and gay employees who feel able to ‘come out’ in the
workplace. To help gay and lesbian employees to ‘come out’ the same author
outlines a series of appropriate policy responses.
HRM in practice 6.6 Responding to the needs
of visually impaired employees
Wendy Kerner is visually impaired being completely blind in one eye and having little
vision in the other. She works as a purchase ledger clerk at the 37-bedroom Lauriston
Hotel in Weston-super-Mare. Her main responsibilities are inputting petty cash, cheques
and invoices into the hotel account’s system and doing the weekly cheque run for the
hotel’s suppliers. Additionally, she also maintains the database of suppliers details and
occasionally helps out in reception if the hotel is busy. In order to support her at work the
hotel secured funding from the Government’s Access to Work programme to purchase a
range of equipment. The equipment included technology to enable her to print her work
in Braille and software that enlarges print and speak while Kerner types. Working prac-
tices at reception were also altered slightly to move from a handwritten list of petty cash
transactions to printing a Braille version which Kerner can read.
Source: Guild (2002).
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? Understand the effects of the closet – being gay and lesbian and not feeling that
the workplace is sufficiently supportive to allow them to come out will often
have a negative impact on the individual and their standard of work.
? Recognize the benefits of ‘coming out’ – many gay and lesbian employees
describe coming out as the most significant event of their working life, often
leading to increased job satisfaction, motivation and enhanced commitment to
the organization.
? Know your own people – action may be needed to ensure that the organization
is one where staff feel safe to come out. This may require the organization to
explore their employees’ attitudes to sexual orientation to determine the appro-
priate policy responses.
? Raise awareness – as with other forms of discrimination, discriminatory behav-
iour can often be unwitting. There may be a need to raise awareness of the
issues surrounding sexual orientation through things like discussion groups.
? Support a lesbian and gay network – ‘invisibility’ at work is often an issue for
lesbians and gay men and an employee network can be useful to provide sup-
port and also raise the profile of sexual minorities with colleagues.
? Ensure support from top management – it is important to have a senior man-
ager, who is not necessarily gay themselves, to act as a diversity champion for
sexual minorities in the workplace.
? Create a culture where people can come out – much of the above suggests
means by which this can be done. There is also a need to train managers to make
the right decisions in support of such a culture.
Cooper (2003) reports evidence from 20 organizations in terms of their response to
the new regulations on religious discrimination. Only seven of the organizations
were conducting a thorough review of policies and making changes to practices,
whilst the remaining 13 organizations were simply adding the word ‘religion’ to
their discrimination policies. The same author cites several legal experts who sug-
gest that there is a need for organizations to be proactive in their interpretation of
the legislation. One legal expert is quoted in Cooper as suggesting that, ‘religion is
key to way some people identify themselves – it’s more important than ethnicity
or nationality – and they rightly expect companies to accommodate their religious
needs and protect them from discrimination’ (p. 27). Advice from the Department
of Trade of Industry and Advisory Conciliation and Arbitration Service points to a
number of areas that organizations should be considering with regard to religious
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discrimination. For example, they caution against word of mouth recruitment and
also suggest employers should examine areas such as the provision of prayer room
facilities and the possibility of flexible work to accommodate religious holidays
(and see HRM in practice 6.7).
Afurther piece of legislation which is set to have a significant impact on human
resource policies is that concerned with age. On its election in 1997 the Labour
Government promised legislation to prohibit age discrimination, a situation that
already existed in a number of other countries including large parts of Europe and
the US. However, the Government eventually opted for a non-statutory code of con-
duct called Age Diversity in Employment. As a voluntary code, however, the code of
conduct lacked teeth. Consequently, when in 2000 the UK decided to support the
EU directive on equal treatment, the Government pledged to introduce legislation
outlawing age discrimination by October 2006.
In common with the other areas covered by legislation the new legislation on
age will aim to ensure that workers are not discriminated against in areas such as
recruitment and selection, promotion and the provision of training. IRS (2004) note
the unpreparedness of many employers for the age discrimination legislation not-
ing, amongst other things, that one in three employers are unaware that the legis-
lation will take effect in the near future. Indeed, in a more recent overview of the new
legislation IRS (2006a, b, c) recognize that experience in other countries suggests that
the introduction of the legislation is likely to see a significant number of claims for
age discrimination. If organizations wish to avoid such a situation they should aim
to develop a more proactive approach to the introduction of the legislation. For
HRM in practice 6.7 British Airways responding
to the legislation on religious discrimination
RfO (2004) reports how, in response to the new regulations prohibiting discrimination on
religious grounds, British Airways consulted with their employees via a series of focus
groups and meetings. The intent of the meetings was to ensure that the needs of differ-
ent groups of employees were managed to conform to the legislation. In discussing the
issues with employees some of the key issues raised were: availability of prayer rooms,
uniform and dress code regulations, labelling of food and time off for praying and reli-
gious festivals. Consideration of these topics was then used to develop a frequently
asked question section on the British Airways staff website.
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example they could become an Age Positive Employer Champion. Such employers
are committed to tackling age discrimination in their own workplace and taking
practical steps to change their employment practices. In addition, further steps to
achieving an age-diverse workforce include (IRS, 2004: 48):
? Reviewing the employment cycle from recruitment to retirement in order to
eradicate any age bias, encompassing areas such as recruitment advertising.
? Clearly communicate with suppliers expectations about creating an age-diverse
workforce.
? Use the Age Positive logo on recruitment adverts.
? Remove any reference to date of birth from all application forms.
? Proactively appeal to older workers through recruitment advertising.
? Champion age diversity at a senior level within the business.
? Use external and internal PR to share good practice – feature employees as age-
positive role modes.
? Adopt a flexible approach to recruitment.
Lastly, there is the Rehabilitation of Offenders Act 1974. The CIPD (2006) suggests
that one fifth of the working population has a criminal record, with Drury (2001)
recognizing that for men under 35 the figure is one in three. Although some
employers may be wary of employing somebody with a criminal record it is import-
ant to recognize that the Act enables offenders who received less than a custodial
sentence of up to two and a half years to be rehabilitated, and their convictions to
be ‘spent’. This means that after a certain amount of time potential employees are
able to answer no to the question of whether they have got a criminal record or not.
The length of time is dependent on the sentence received. It is important to recog-
nize that it is illegal for an employer to discriminate on the basis of a spent convic-
tion. Gledhill (2002) suggests that the hospitality industry, in particular, should
look seriously to employing ex-offenders to address labour shortages and recruit-
ment problems. He reports a Prison Service chef training scheme which aims to
train inmates to National Vocational Qualification (NVQ) level 2 in food hygiene
and food handling. Prisoners on the scheme cook for fellow inmates so get used to
the pressure of working to deadlines and a number of ex-offenders were successful
in gaining jobs on release.
One final point to note before the chapter moves on to consider managing
diversity is the issue of a single equalities body. As we have previously recognized
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the EOC, CRE and DRC are responsible for the broad areas of sex, race/ethnicity
and disability. Currently there are no bodies that are responsible for sexual orien-
tation and religion. In response to this situation, and the emergence of age legisla-
tion in October 2006, the UK Government has now established a single equalities
body. This new body will be known as The Commission for Equality and Human
Rights (CEHR) and came into being with The Equality Act 2006. In October 2007
CEHR will merge the functions of the EOC and DRC, as well as taking responsi-
bility for sexual orientation, religion and age. Surprisingly, the CRE will not imme-
diately become part of the new organization, but at the time of writing it is envisaged
that it will join by 2009.
Managing diversity
In reviewing the debate about equal opportunities, what we have been largely
talking about to date is the meeting of statutory requirements to offer equal oppor-
tunities to all in the organization, or those who will potentially join the organiza-
tion. In many respects this can be considered the short-term agenda as outlined by
Goss (1994), where the emphasis is on meeting legal obligations to ensure separate
groups are not discriminated against in the workplace. Alonger-term agenda that
aims to move away from such a narrow approach is suggested by the notion of
managing diversity.
Managing diversity is also particularly important given that it would be remiss
to imagine women or ethnic minorities or people with disabilities as a homogen-
ous group. For example, women are divided by class, ethnicity, age and occupa-
tional status. Similarly, ethnic minorities are far from homogenous, for example
there may be major differences in the opportunities and employment experience
between Asian employees and black African employees. In that sense resistance to
equal opportunities policies may not come simply from white, non-disadvantaged
men. Opposition to equal opportunities may also be seen from particular groups
in society due to the fear of backlash, or being seen to have achieved a position
based on grounds other than merit. Of course, the legislative agenda does not neces-
sarily seek to create such perceptions or stereotypes, for example it does not sup-
port positive discrimination. Nevertheless, the perception that equal opportunities
is primarily driven by a defensive legislative agenda has led to the emergence of
managing diversity as a potentially more strategic and business-oriented approach
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 134
to engendering equality of opportunity. To consider this point we should consider
three questions in relation to managing diversity, these being:
1 What is managing diversity?
2 How are equal opportunities moved on by managing diversity?
3 What action does managing diversity require?
In answer to the first question, Ellis and Sonnenfield (1994: 82) define managing
diversity as, ‘the challenge of meeting the needs of a culturally diverse workforce
and of sensitizing workers and managers to differences associated with gender,
race, age and nationality in an attempt to maximize the potential productivity of
all employees’. In a similar vein, Kandola and Fullerton (1998: 8) suggest that:
The basic concept of managing diversity accepts that the workforce consists
of a diverse population of people. The diversity consists of visible and non-
visible differences which include factors, such as sex, age, background, race,
disability, personality and workstyle. It is founded on the premise that har-
nessing these differences will create a productive environment in which
everybody feels valued, where their talents are being fully utilized and in
which organizational goals are met.
With regard to the second question, Table 6.2 illustrates the manner in which the
managing diversity and equal opportunities are suggested as being different.
So the question we can ask ourselves is to what extent are organizations moving
to become diverse and multicultural and if not how can organizations address this
issue. At one level many would argue that the tourism and hospitality industry is, in
all respects, be it unit, locality, clientele or labour market, possibly the most inter-
national of industries. Baum (1996: A77), for example, notes how:
Tourism … is almost unique in providing multicultural interface at a variety
of levels and in many situations, simultaneously. It is an everyday experience
for a Japanese visitor to London to be checked into a hotel by an Australian
receptionist, supervised by an English front office manager of Afro-Caribbean
origin, in a hotel owned by Middle Eastern financial interests, managed by
an American hotel multinational who have appointed an Italian as general
manager to the property.
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However, whilst Baum’s quote is useful in pointing to the multicultural nature of
tourism and hospitality we should also recognize that multiculturalism of this
nature does not axiomatically equate to genuine opportunity for all in tourism and
hospitality organizations. For example, research that has been conducted in the
US points to some limited success in diversity programmes. Wilborn and Weaver
(2002) investigated diversity management training initiatives (DMTIs) by survey-
ing 139 managers in a range of lodging properties. The managers were questioned
about a variety of DMTIs including aspects such as diversity awareness training
for managers, cross race/gender training teams, networking groups and minority
internships. Nearly half the managers surveyed felt that their organization offered
a good diversity management training programme. Significantly, managers who
were exposed to DMTIs had more positive feelings towards such initiatives in
terms of recognizing their importance towards organizational success. In a similar
vein, Speizer (2004) notes the success of Denny’s restaurant chain from being seen
as one of the most racist companies in America to being number one on Fortune
Table 6.2 Differences between managing diversity and equal opportunities
Managing diversity Equal opportunities
? Ensures all employees maximize their ? Concentration on issues of discrimination
potential and their contribution to the
organization
? Embraces a broad range of people; no ? Perceived as an issue for certain groups in
one is excluded the labour market such as women, ethnic
minorities and people with disabilities
? Concentration on issues of movement ? Less of an emphasis on culture change
within an organization, the culture of and the meeting of business objectives,
the organization, and meeting business premised more on moral and ethical
objectives issues
? Is the concern of all employees, ? Seen as an issue to do with human
especially managers resource practitioners
? Does not rely on positive action/ ? Relies on positive action
affirmative action
Source: This material is taken from Diversity in Action: Managing the Mosaic by Kandola, R. and Fullerton, J.,
2nd edition (1998), with the permission of the publisher, the Chartered Institute of Personnel and
Development, London.
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magazine’s list of 50 best companies in America for minorities. To address the prob-
lem of racism, Speizer reports how Denny’s appointed the first diversity officer to
report directly to the CEO. With a budget of over $1 million dollars a year the diver-
sity officer was able to develop a series of initiatives. For example, they hired over
100 diversity trainers and insisted that all employees – from senior executives to
dishwashers – attend diversity awareness classes. Denny’s also sought to encour-
age more customers from ethnic minority groups and also diversified their suppli-
ers going from having no minority suppliers or contractors to spending over $616
million with minority suppliers between 1995–2000. On the other hand research
undertaken by Groeschl and Doherty (1999) on a number of hotels in San Francisco
points to a much more reactive approach, what they term a ‘reactive diversification
strategy’. Such an approach is largely concerned with complying with legislation in
areas like affirmative action and training in equal opportunities areas such as the
American Disability Act. As they note though, ‘the hotels have not been able, so far,
to make the next step from tolerating diversity to valuing it’ (p. 266).
Clearly, then, managing diversity is something that organizations have to think
about in a proactive manner. There are no easy prescriptions as to how this approach
can be achieved, though Kandola and Fullerton (1998) offer what they consider to be
an integrated and coherent model of the diversity-oriented organization. They also
suggest this model can be used as a benchmark to drive organizational initiatives
and strategy. The idea of such an organization is underpinned by the notion of the
creation of a mosaic to encourage diversity in organizations:
Missions and values
Objectives and fair processes
Skilled workforce: aware and fair
Active flexibility
Individual focus
Culture that empowers
These aspects are now briefly discussed.
Diversity-oriented organizations will seek to develop a strong and positive
mission and core values statement, which recognizes that managing diversity is an
important long-term business objective for the organization. In support of the mis-
sion and vision all processes and systems in organizations (e.g. recruitment, selec-
tion, performance appraisals, promotion decisions and so on) need to be audited
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EQUAL OPPORTUNI TI ES AND MANAGI NG DI VERSI TY 137
and re-audited to ensure that no one group predominates. With regard to the
skilled workforce Kandola and Fullerton note the importance of ensuring that the
entire workforce is aware of and guided by the principles of managing diversity.
By understanding why diversity is important employees can act in a manner
which ensures their biases and prejudices do not influence the way they make
decisions and work with colleagues. Such an approach may also require a pro-
active approach to equipping managers in particular with the right kind of skills
to ensure managing diversity is supported by the requisite managerial capability.
Active flexibility is important in ensuring that working patterns, policies, practices
and procedures support the approach to diversity. For example, in recognizing the
diverse needs of all employees Kandola and Fullerton note the importance of
adopting a ‘cafeteria’ approach to issue surrounding work/life needs. In advocating
an individual focus Kandola and Fullerton note how sometimes ‘special events’
that focus on a particular group can actually serve to reinforce stereotypes or
increase hostility to particular groups. Resultantly, things such as cross-cultural
training programmes should aim to foster respect for employees as individual
actors, rather than treating employees as member of a particular group, with eas-
ily categories differences. Finally, underpinning much of the above is the need to
sustain the right kind of organizational culture. We have already noted the import-
ance of organizational culture in Chapter 2 and in terms of managing diversity
there is a need to ensure the prevailing culture encourages participation and cre-
ativity from all organizational members.
Conclusion
At the outset of the chapter we asked whether we are likely to find equality of
opportunities within organizations. The simple answer would be no. There was
evidence within the chapter to suggest that certain groups in society still continue
to face discrimination which has a deleterious effect on their employment experi-
ence. That said, the chapter also recognized the manner in which legislation aims
to eradicate such discrimination and how managing diversity seeks to encourage
organizations to adopt a more proactive response to ensuring opportunity for all.
Although equal opportunities and managing diversity may be represented as being
dichotomous in their approach, in reality many organizations will adopt an
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 138
approach which has elements of both. Many would recognize that valuing and
promoting diversity in the workforce probably relies on a delicate balance between
legal requirements and a business-driven desire to be an employer of choice and to
attract and retain the best employees, regardless of their backgrounds.
References and further reading
Advisory, Conciliation and Arbitration Service (2006) Annual Report and Accounts 2005/06, ACAS.
Anon (2004) ‘Countdown to DDA day’, Caterer and Hotelkeeper, 22 July, 34–36.
Arkin, A. (2005) ‘Chip off the old block’, People Management, 21 April, 32–34.
Bald, S. (1997) ‘No excuse for patronising language’, People Management, 3 April, 19.
Baum, T. (1996) Managing Cultural Diversity in Tourism, British Tourist Authority/English Tourist Board,
Insights, A77–A84.
Cabinet Office (2003) Ethnic Minorities and the Labour Market, Cabinet Office.
Chartered Institute of Personnel and Development (2006) Employing People with Criminal Records
Factsheet, CIPD.
Cooper, C. (2003) ‘Minority support’, People Management, 4 December, 24–27.
Department of Trade and Industry (2001) Creating a Work-Life Balance: A Good Practice Guide for the
Hospitality Industry, DTI.
Drury, B. (2001) ‘How to assess criminal convictions’, People Management, 22 March, 52–53.
Ellis, C. and Sonnenfield, J. (1994) ‘Diverse approaches to managing diversity’, Human Resource
Management, 33(1), 79–109.
Equality Opportunities Commission (2005) Facts About Women and Men in Great Britain, EOC.
European Professional Women’s Network (EPWN) (2006) Second Bi-annual EuropeanPWN BoardWomen
Monitor 2006, press release at http://www.europeanpwn.net/pdf/boardwomen_press_release120606.pdf
(accessed 15 July 2006).
Gledhill, B. (2002) ‘Releasing potential’, Caterer and Hotelkeeper, 10 October, 32–34.
Goss, D. (1994) Principles of Human Resource Management, Routledge.
Gottleib, M. (1992) Letter to the editor in Caterer and Hotelkeeper, 25 June 1992, 20.
Groeschl, S. and Doherty, L. (1999) ‘Diversity management in practice’, International Journal of Contemporary
Hospitality Management, 11(6), 262–268.
Guild, S. (2002) ‘Willing and able’, Caterer and Hotelkeeper, 17 January, 29–29.
Hope, K. (2005) ‘Holding back the years’, People Management, 21 April, 24–30.
Hotel and Catering International Management Association (1999) Managing Diversity: Women at Work,
Management Brief No. 3, HCIMA.
Income Data Services (2001) Promoting Racial Equality, IDS Studies No. 719, September.
Income Data Services (2003) Opportunity Now, IDS Studies No. 758, September.
Income Data Services (2006) Promoting Race Equality, IDS HR Studies, No. 825, July.
Industrial Relations Services (2003) ‘Managing disability 2003: a progress report’, IRS Employment Review,
No. 785, 3 October, 11–17.
Industrial Relations Services (2004) ‘Using age diversity policies to attract and retain older workers’, IRS
Employment Review, No. 808, 24 September, 42–48.
Ch06-H6572.qxd 11/22/06 5:51 PM Page 138
EQUAL OPPORTUNI TI ES AND MANAGI NG DI VERSI TY 139
Industrial Relations Services (2006a) ‘Age discrimination (1)’, IRS Employment Review, No. 847, 19 May,
53–58.
Industrial Relations Services (2006b) ‘Age discrimination (2)’, IRS Employment Review, No. 848, 2 June,
51–57.
Industrial Relations Services (2006c) ‘Age discrimination (3)’, IRS Employment Review, No. 849,
23 June, 51–58.
Johnston, J. (2006) ‘Half of gays believe they’ll be discriminated against if they “come out” at work’,
Sunday Herald, 22 January, 14.
Kandola R. and Fullerton, J. (1998) Diversity in Action: Managing the Mosaic, CIPD, 2nd edition.
Labour Research Department (1999) ‘How do tribunals define disability?’, Labour Research, January, 32.
Labour Research Department (2000) Tackling Disability Discrimination, LRD.
Labour Research Department (2000a) ‘UK soft on homophobia’, Labour Research, July, 10–12.
Labour Research Department (2003) ‘Making workplaces disability friendly’, Labour Research, December,
15–16.
Labour Research Department (2003a) ‘Two cheers for gay-bias rules’, Labour Research, July, 11–13.
Labour Research Department (2005) Black and Minority Ethnic Workers: Tackling Discrimination, LRD.
Labour Research Department (2006) Law at Work, LRD.
Magd, H. (2003) ‘Management attitudes and perceptions of older employees in hospitality management’,
International Journal of Contemporary Hospitality Management, 15, 7, 393–401.
Mayling, S. (2003) ‘Can positive discrimination help women?’, Travel Trade Gazette, 21 April, 8–9.
Opportunity Now (2005) Review 05:06: All About Opportunity Now and Its Future Plans, Opportunity Now.
Osborn, A. (2002) ‘Norway sets 40% female quota for boardrooms’, The Guardian, August 1, 13.
Qu, H. and Cheng, S. Y. (1996) ‘Attitudes towards utilizing older workers in the Hong Kong hotel industry’,
International Journal of Hospitality Management, 15(3), 245–254.
Race for Opportunity (2004) RFO Newsletter, Summer, 16.
Rossiter, P. (2005) ‘Women in Business’, Leisure Opportunities, 23 March, 7.
Runnymede Trust (2000) Moving on Up? Racial Equality and the Corporate Agenda: A Study of the FTSE
100 Companies, Central Books.
Smethurst, S. (2004) ‘Ageism rife in UK workplace’, People Management, 15 January, 10.
Smith, L. (2005) ‘Too few black and Asian faces at the top’, Guardian, 17 November, 29.
Speizer, I. (2004) ‘Diversity on the menu’, Workforce Management, November, 41–45.
Stredwick, J. (2005) An Introduction to Human Resource Management, Elsevier, 2nd edition.
Walsh, C. (2004) ‘A woman’s place is on the board’, Observer Business, 2 May, 5.
Ward, J. (2003) ‘How to address sexual orientation’, People Management, 23 October, 62–63.
Wilborn, L. and Weaver, P. (2002) ‘Diversity management training initiatives: a profile of current practices
within the lodging industry’, Journal of Human Resources in Hospitality and Tourism, 1(4), 79–96.
Websites
The various equality commissions can be found at:
Commission for Racial Equality http://www.cre.gov.uk/
Disability Rights Commission http://www.drc.org.uk
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Equal Opportunities Commission http://www.eoc.org.uk/
Although it does not come into official existence until October 2007 the CEHR already has a website,
http://www.cehr.org.uk/
Stonewall is an organization that supports gay people’s right to equality http:// www.stonewall.org.uk/
workplace
The Employers Forum on Age can be found at http://www.efa.org.uk
The Apex Trust is a voluntary organization that helps ex-offenders get back into employment http://www.
apextrust.com/apextrust/exo_rehabact.shtm
For information on the various world religions see http://www.bbc.co.uk/religion/religions/index.shtml
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 140
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Chapter 7
Training and
development
Chapter objectives
This chapter considers the key role of training and
development in tourism and hospitality
organizations. The chapter aims to:
? Distinguish the different levels of analysis to
understand approaches to training and
development.
? Appreciate the importance of government-level
policy in establishing the context in which
tourism and hospitality organizations develop
their training policies.
? Recognize debates surrounding terms such as
education, training and development.
? Consider the range of training methods
available to tourism and hospitality
organizations.
141
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 142
Introduction
It is increasingly recognized that human resource development (HRD) is crucial in
ensuring effectiveness, quality and responsiveness in organizations to an ever
changing and complex environment. Resultantly, training and development activ-
ities now seek to emphasize adaptability, flexibility and continuous development
to ensure that organizations can survive and compete in an ever more competitive
environment. However, the importance of training and development is not just
apparent for organizations. As we increasingly are entreated to engage in lifelong
learning, then training and development becomes important for individuals.
Moreover, there is now also recognition of the importance of national competitive-
ness, especially in an ever more globalized world. Training and development,
therefore, becomes important from an individual, organizational and national per-
spective. Therefore we see more and more talk of the importance of HRD which is
likely to encompass notions of education, learning, training and development and
the interchangeability or otherwise of these distinctions will also be something
considered in this chapter. Before we begin to consider these issues in detail
though it is useful to delineate different levels of analysis in understanding train-
ing and Table 7.1 outlines the ways in which we can think of training.
Throughout this chapter we will consider various aspects of these levels and
begin initially by considering the importance of how national government policy
impacts on training and development.
Understanding the context: national level
responses to training
It is often argued that a nation’s competitive advantage depends on the skills and
inventiveness of its people. Often the manner in which organizations seek to
respond to this issue will be determined to a large extent by the views of the gov-
ernment. Increasingly in the UK in the 1980s and 1990s there was an emerging con-
sensus from government, policy makers and practitioners that training should be
encouraged within organizations for the greater good of the economy. Despite the
seeming acceptance by government and employers of the importance of training
and the need to encourage it, there is a good deal of debate as to whether, in reality,
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TRAI NI NG AND DEVELOPMENT 143
Table 7.1 Levels of analysis for understanding approaches to training and development
Level Main organizations involved/activities undertaken
National/Governmental level ? Government policy, for example the UK Government
seeking a more proactive approach to encourage training
in organizations
? Training initiatives, for example in the UK Investors in
People (IiP) and Apprenticeships
Industry level ? National Training Organizations (NTOs), for example
People 1st the Sector Skills Council (SSC) for hospitality,
leisure, travel and tourism
? Industry level initiatives, for example Excellence Through
People and Welcome Host
Company level ? Creation of an overall view of company’s approach to
training, for example seeking IiP accreditation, being
involved in Welcome Host and Excellence Through
People
? Ensuring ‘fit’ between what the company wants to
achieve and how units can operationalize this
Unit level ? Ensuring on- and off-the-job training takes place
? Monitoring individuals training and development plans
? Performance development and monitoring, for example,
seeking to enhance quality service through training
Team level ? Motivation and performance
? Team building
Individual level ? Improvement in knowledge, skills and attitudes
? Sustaining employability
? Enhanced motivation and performance
? Improving aspects of discipline and behaviour
? Career progression
there has been the training revolution claimed. This point recognizes that over
much of the preceding period the UK’s record on training was poor compared to
other nations such as Germany, Japan and Sweden who were felt to invest heavily
in training and development. For example, Holden (2004: 314) notes how, ‘Until
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 144
the 1980s, training and development in British organizations were inadequate com-
pared with other industrialized nations’. In this sense the UK has often been char-
acterized as voluntaristic with regard to training and development, meaning that
the state took a hands off view in terms of encouraging employers to train their
employees. Instead, individual employers were largely left to their own devices
with regard to how much, or indeed, how little training they would provide.
Consequently there has been much debate about the levels of training expenditure
both by Government and employers, with some expressing concerns that, if any-
thing, real expenditure on vocational education and training (VET) have fallen in
recent years. Hyman (1996: 306–307) exemplifies this scepticism in his recognition
that ‘what is more questionable … concerns the extent to which the majority of
British employers have taken responsibility for strategically training and develop-
ing their employees’, with much training simply being of the reactive ‘fire-fighting’
type. For many then there may be a gap between the perceived importance of train-
ing and the willingness to do something about it, with suspicions that in the UK too
many organizations still see training as a cost and not an investment. Indeed, it
could be argued that such a view may simply reflect the short-termism inherent in
British business, where corporate objectives tend to be short-term and defined by
short-term profit and financial criteria. Table 7.2 and HRM in practice 7.1 below
Table 7.2 VET policies and practices in selected countries
UK Germany Sweden Japan USA
Traditionally, Much more state State directed, Directed/voluntarist Voluntarist,
voluntaristic with direction, aiming to create with the state uncoordinated,
limited state encouraging an active labour setting and with emphasis
intervention a dual system of market approach enforcing training on individual
finance rather concentrating on to ensure standards. Large effort and
than industry theory or employees remain companies offering individual
oriented, class practice. employable. lifetime payment.
based. Employers are employment and
strongly significant training.
encouraged to
train.
Adapted from Holden (2004: 337) Human Resource Management: A Contemporary Approach 4/ed,
Beardwell, Holden and Claydon, with permission from Pearson Education Limited.
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highlight the impact of the above discussion on the VET policies and practices in
some selected countries.
Consequently there has been much support for the notion that Britain needs to
invest in training and development to ensure that it does not become a low-tech,
Review and reflect
Outline arguments for and against government intervention in support of training and
education.
TRAI NI NG AND DEVELOPMENT 145
HRM in practice 7.1 National skill-creation
systems and career paths in the tourism industry
in the UK, Germany and the US
Studies of the UK, Germany and the US have found that patterns of career development
and commitment to working in the tourism industry are strongly influenced by the national
VET system. Germany, which has a more structured approach compared to the UK and US,
encourages individuals to complete an apprenticeship prior to entering the tourism indus-
try. Such an apprenticeship means that Germany’s education and training system is geared
to produce a much higher proportion of qualified staff for the tourism industry. As a result
employees in Germany were able to secure relatively highly skilled and autonomous posi-
tions at an earlier age than their counterparts in the UK and the US. There is also evidence
which points to the greater productivity of German tourism employees over their British
and American counterparts. One report concluded that Germany’s high productivity and
service levels are due to the wider use of qualified manpower trained through the partner-
ship arrangements for the dual system. This study notes that craft qualifications were held
by 2.5 times as many employees in Germany compared to the UK. A conclusion to be
drawn is that the dual system within which German employees for tourism are trained
‘embeds’ commitment to the sector to a much greater degree than elsewhere and this,
combined with high levels of reward, contributes to a greater sense of professionalism and
productivity. Finally, German employees were also more likely to advance more rapidly
within the industry due to the training and education they receive.
Derived from STRU (1998); Finegold et al. (2000).
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low-wage, low-skill, cheap labour economy wherein it seeks to compete on the
basis of a low-skill, low-quality product market strategy relying on price-based
competitiveness. What this has meant in practice is that in recent years the UK
government has attempted to take a more active role by introducing a range of ini-
tiatives that aim to improve skill levels in the economy. Indeed, Keep (2005) con-
siders the extent to which the UK may be entering a ‘post-voluntarist’ era, where
the Government is seemingly increasingly prepared to take a more active role in
encouraging learning and development. To an extent this change may be explic-
able by the sense that the UK is playing ‘catch up’ with a number of its international
competitors. Resultantly, the Government has introduced a number of initiatives
in recent year, such as National/Scottish Vocational Qualifications (N/SVQs),
Investors in People (IiP) and Apprenticeships. All of these initiatives attempt to get
employers to increase training and are now considered.
N/SVQs
The rationale for the introduction of N/SVQs in the late 1980s was to provide greater
coherence in vocational qualifications and thus the existing vocational structure
was rationalized into N/SVQs. N/SVQs are work-related, competence-based
qualifications, which are appropriate to all industries and all levels of employ-
ment, from the shop floor to the board room. N/SVQs are statements confirming
that the individual employee can perform to a specified standard and that they
posses the skills, knowledge and understanding which makes possible such per-
formance in the workplace. They provide a progressive route from Level 1, which
is semi-skilled through to Level 5, which recognizes the skills needed to be an
organizational leader. N/SVQs are important as they recognize achievements in
the workplace and are based on assessing work experience and achievements. In
terms of their broad equivalence to educational attainment then Level 2, for exam-
ple, is broadly similar to GCSEs, Level 3 is broadly equivalent to A/AS Levels or
Scottish Highers, Level 4 is higher national diploma/degree level and Level 5
is degree/postgraduate level (though within tourism and hospitality there are
currently no options to seek Level 4 or 5 N/SVQs).
In the tourism and hospitality industry the largest number of registrations has
tended to be at Levels 1 and 2, in areas such as food preparation and cooking and
serving food and drink (QCA, 2003). Hales (1996; and see also IRS, 1999) suggests
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the case for developing and implementing N/SVQs is largely based on two rea-
sons. First, their contribution in enhancing the competitiveness and performance
of the UK economy by widening access to training and qualifications. Second, the
benefits to participants (i.e. employees), in terms of increased recognition for work-
place ability and competence, with the effect of increasing job satisfaction, motiva-
tion, a sense of achievement and standards of work. Hales reports on five case
study organizations in the hotel sector. All of the case study organizations were
small businesses employing between 22 and 44 employees, and four of them had
adopted and continued to use N/SVQs, with one adopting and then subsequently
dropping them. Hales research suggested that those hotels which had adopted
and persevered with N/SVQs noted a pay-off in terms of better employee atti-
tudes and behaviour, increased service quality and an overall improvement in
business performance. However, he does remain sceptical about the extent to
which N/SVQs may penetrate the small tourism and hospitality business sector
generally, unless they are given active encouragement.
Others such as Lucas (1995) have been rather more critical of the qualification.
Lucas suggests that Levels 1 and 2 arguably do not fit the criteria of training as sys-
tematically developing knowledge, skills and abilities. Consequently they represent
‘qualifications without substance [and] lack any real sense of meaning or value’
(Lucas, 1995: 60). Lucas’ criticisms reflect more general critiques of N/SVQs with
worries about their skill levels and whether they are too narrowly defined and task
specific. There is also some disquiet about the overly bureaucratic nature of
N/SVQs. The final criticism which rather reflects all of the above is the argument
that there is little evidence that N/SVQs are able to cope with changing technolo-
gies, skill requirements and new methods of work (and for further discussion of
the problematic aspects of N/SVQs or somewhat more cynically ‘No Value or
Quality’, see Foote, 1999; Druce, 2004).
Investors in people
The second initiative is IiP, which is a national level initiative run by IiP UK and
administered locally by Learning and Skills Councils (LSC) (Learning and Enterprise
Councils in Scotland) under the supervision of IiP UK. IiP is designed to be appli-
cable to all organizations whether large or small, public or private, manufacturing
or service. IiP attempts to link training and development to business strategy and
TRAI NI NG AND DEVELOPMENT 147
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as a result improve business performance and secure competitive advantage for
organizations. At its inception in 1991 organizations were expected to demonstrate
their adherence to a number of general principles in order to qualify for the IiP
Standard. The four general principles were:
1 Commitment: An IiP makes a public commitment from the top to develop all
employees to achieve its business objectives.
2 Planning: An IiP regularly reviews the training and development needs of all
employees.
3 Action: An IiP takes action to train and develop individuals on recruitment and
throughout their employment.
4 Evaluation: An IiP evaluates the investment in training and development on
performance of individuals, team and the organization to assess and improve
effectiveness.
Organizations seeking IiP accreditation were tested against these four prin-
ciples, which were measured using 23 indicators, later reduced to 12. More recently,
following an extensive process of consultation with employers and organizations
such as the Trade Union Congress, Confederation of British Industry and the
Chartered Institute of Personnel and Development, the Standard was revised and
re-launched in November 2004. The new Standard has three principles; plan, do
and review and these are underpinned by 10 indicators of good practice, as indi-
cated in Figure 7.1.
At the time of writing nearly 40000 organizations across the economy as a
whole had achieved the Standard (IiP, 2005). Generally, evidence from a range of
studies suggests that the initiative has had a positive impact on those organizations
gaining the accreditation (e.g. see Alberga et al., 1997). Hoque (2003: 565), whilst
offering some caveats as to the success of the Standard, concludes that ‘on average,
training practice is better in IiP-accredited workplaces than in non-accredited
workplaces’. Equally in relation to the tourism and hospitality industry a number
of case studies point to the manner in which IiP can improve organizational per-
formance (e.g. see Georgeson, 1999; HRM in practice 7.2).
Supporters of IiP would therefore argue that the standard thus improves
business performance, with increases in aspects such as turnover, efficiency, prof-
itability, enhanced customer service and improvements in company image; and
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HRM outcomes, such as lower labour turnover, improved skills and competences,
improved communications and increased motivation. At the same time there are
also some criticisms, as outlined in HRM in practice 7.3.
Notwithstanding some of the criticisms IiP seems to have established itself
as a positive and important attempt to encourage employers to adopt more
systematic approaches to training and development to improve organizational
performance and competitiveness. Indeed, it could be argued that the success of
the standard can be gauged by the recognition on the IiP UK website, http: //
www.investorsinpeople.co.uk, that IiP has been adopted in over 30 countries as an
example of attempting to encourage best practice HRD and improving the com-
petitiveness of the country (e.g. see Kidger et al., 2004).
TRAI NI NG AND DEVELOPMENT 149
7
Involvement
and empowerment
8
Learning
and development
9
Performance
measurement
10
Continuous
improvement
1
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strategy
2
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strategy
3
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management
strategy
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management
strategy
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effectiveness
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Figure 7.1 The principles of the IiP Standard, Source: IiP (2004: 5) reproduced with kind
permission of Investors in People UK, © Investors in People, 2006
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 150
HRM in practice 7.2 Improving training at Pontins
Pontins is a British company that has a number of holiday centres which are catering pri-
marily for families. The vast majority of Pontins employees are seasonal workers, many of
whom will only work for the company for a short period of time. Despite the relatively
high turnover of staff that this situation creates the company’s commitment to the IiP
Standard means that all employees have the opportunity to improve, no matter how
short their stay is with the company. Drawing on the IiP guidelines the company now has
a structure which means that every employee will have a personal development file with
job description and aims, access to NVQs, access to funding for vocational training, assist-
ance with professional qualifications and assessment of aims and goals and help achiev-
ing them. So even those employees who only stay a short period of time can gain a new
qualification. As well as increasing the amount of training and delivering higher stand-
ards of service, the company has also seen improved employee retention, resulting in
greater productivity and reduced costs.
Derived from http://www.investorsinpeople.co.uk/IIP/Web/Case+Studies/Pontin.htm
HRM in practice 7.3 Investing in people:
at what cost?
Amanda Scott, then General Manager of the Copthorne Hotel in Glasgow, suggests that
in many respects IiP embodied what any good manager should be doing – investing in
their people. However, she also outlined a number of criticisms. Many companies that
have attained the IiP Standard often already have good HR systems and procedures in
place so gaining the award may simply be nothing more than a ‘badging’ process.
Moreover it is a badging process that generates a lot of paperwork and bureaucracy,
with the awarding body often using obscure and confusing jargon. She also suggests
that the cost of IiP accreditation may well be prohibitive, ‘As a management model it can
deliver, but in my opinion £4000 for the privilege of a branding exercise … cannot be jus-
tified. It if was my personal money? I don’t think so’. This latter point concerning the
costly nature of IiP accreditation could be particularly important for smaller companies
who predominate in tourism and hospitality. The CIPD has recently estimated that the
total cost of seeking IiP is between £5000–£15 000 depending on the size of the organ-
ization and how much consultancy support the organization uses.
Derived from Scott (1999); CIPD (2006).
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Apprenticeships
Government-subsidised apprenticeships were first introduced in 1995 as Modern
Apprenticeships. Such apprenticeships aim to offer a career to those more motivated
by workplace learning, rather than pure academic study. The aim was to take the best
aspects from traditional apprenticeship schemes, update them and extend them to the
service and public sectors (Gospel and Fuller, 1998). The scheme was recently
re-launched in May 2004 as Apprenticeships, though in Scotland they remain Modern
Apprenticeships. Apprenticeships are primarily aimed at 16–24-year olds (though at
the time of writing there are also pilot programmes for those aged 25-plus) who want
to obtain intermediate skills by combining a paid job with training. There are two
levels, the Apprenticeship is for 2 years and at the end of this period the apprentice
will achieve an NVQ Level 2 (National Vocational Qualification); there is also the
Advanced Apprenticeship, which is for a period of 3 years and leads to NVQ Level 3.
The Apprenticeship alternates between productive employment with on- and off-the-
job training to provide a mixture of occupationally specific training as well as more
generic key skills, such as communication, numeracy, literacy and teamworking.
Early accounts of the implementation of Modern Apprenticeships in tourism
and hospitality offered guarded optimism with regard to their ability to attract
young people to work in the industry. Mason (1997) recognizes how the scheme
had attracted around 7000 young people by 1997, with the aim of having 10000
apprentices by 2000. Mason reports on the success of the scheme within De Vere
Hotels, which was aiming to have 100 apprentices across the UK by the end of 1997.
The company reported that the scheme allowed them to embed and maintain a
strong training culture within trainees. Trainees were also fully immersed in the
company’s organizational culture, the ‘De Vere Way’, which allowed the company
to develop future managers. Similarly, Yates’ Wine Lodge report a number of
benefits from operating the scheme such as improved staff retention and loyalty,
improved staff morale, enhanced skill sets for employees and more efficient and
productive employees (Anon, 2003a). Whilst the examples of De Vere and Yates
offers a positive view of Modern Apprenticeships other accounts are less encourag-
ing. For example, Manson (2005) reports on a survey conducted for the LSC which
found that only 920, or 4 per cent, of 23000 hospitality employers were looking to
offer apprenticeships in hospitality. Concerns have also been expressed at the high
drop out rate, with around 80 per cent of hospitality apprentices leaving before
completion (Anon, 2003a).
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Industry level
The above discussion has considered the manner in which the VET infrastructure
created by government will have a profound impact on training and development.
Clearly with the creation of initiatives such as N/SVQs, IiP and Apprenticeships
British Governments over the last 20 years or so have attempted to encourage
employers to offer more training. Whilst all of these initiatives have had some
impact in tourism and hospitality, they are not sector specific, unlike another gov-
ernmental initiative, the creation of Sector Skills Councils (SSCs). IDS (2005: 14)
notes how ‘the overall aim to SSCs is to help employers within similar industries to
improve their employees’ skills base and to provide them with leverage, influence,
support and expertise in this pursuit’. Although SSCs are funded by Government
they are run by employers, who work in partnership with a range of stakeholders
in each sector to (Marchington and Wilkinson, 2005):
? Produce intelligence and analysis of future sector skill needs.
? Reduce skill gaps and shortages by influencing the planning and funding
education and training.
? Improve productivity.
? Develop occupational standards for skills in their sector.
? Increase opportunities for everyone in work to boost skills.
As noted in Chapter 1, the SSC for tourism and hospitality is People 1st, which
came into existence in May 2004. People 1st’s mission in the period 2004–2009
is to have an impact on completion rates for qualifications and learning pro-
grammes, investment in training, raising employee skill and productivity levels
and reducing staff turnover through lifelong career development (People 1st,
2004). By the end of People 1st’s first year of existence there was some disquiet as
to its influence (Druce, 2005), though it is too early to offer any definitive comment
on the impact of People 1st in improving skills and training within tourism and
hospitality.
In addition to governmental initiatives, there are also non-governmental ini-
tiatives which have attempted to improve training within tourism and hospitality,
such as Welcome Host, which is described in HRM in practice 7.4.
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Training and development: no longer a dichotomy?
Having outlined the broad context in which organizations are developing their
overall approach to training and the importance of Government policy within that
process, we can now go on and look in greater detail at what exactly training and
development are. Holden (2004: 313) recognizes how, ‘it is difficult to arrive at a
consensus definition of terms such as “development”, “education” and “training”
because of the varied ways in which they are translated into work and life situ-
ations’. Many would argue that training and development have traditionally been
seen as separate and a reflection of an organization’s hierarchy. This point can be
appreciated in acknowledging the manner in which training and development
have been traditionally conceptualized as being distinctive activities.
TRAI NI NG AND DEVELOPMENT 153
HRM in practice 7.4 Welcome Host:
Professionalizing the tourism industry?
The Welcome Host scheme is based on Canadian hospitality programme called
‘Superhost’. Introduced in British Columbia in 1986 to support the growth of tourism
around the world expo in Vancouver. Other franchises include: ‘Kiwi Host’, ‘Aussie Host’,
‘Alaska Host’ and ‘Super Host Japan’. Sweeney (1995: 8) describes Welcome Host as, ‘an
ongoing, comprehensive, community-based programme designed to upgrade the stand-
ards of service and hospitality provided within the tourism industry … By involving the
whole community, the scheme provides access to more formal training for the smaller
operator who may also come into contact with the visitor’. The basis of Welcome Host is
people helping people and its objectives are about aiming to instil a sense of profession-
alism and pride in tourism. Importantly, Welcome Host is not just for tourism employees,
such as travel agents and tour guides, but can also be taken by people like taxi drivers and
traffic wardens and anybody else that tourists are likely to encounter in the destination. In
addition to Welcome Host there are also a number of other programmes such as Welcome
All, which is a course designed to help individuals acquire the knowledge and skills essen-
tial for providing facilities and services that meet the specific needs and expectations of
people with disabilities and special needs; and Welcome International which is a training
programme designed to give people working in the tourism or hospitality industry greater
confidence when meeting and greeting international visitors in another language.
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On the one hand, training is ‘a planned process to modify attitude, knowledge
or skill behaviour through learning experience to achieve effective performance in
an activity or range of activities. Its purpose, in the work situation, is to develop the
abilities of the individual and to satisfy the current and future manpower needs of
the organization’ (MSC 1981, cited in Armstrong, 1999: 507). On the other hand,
development has often been seen as being much more about the growth or realiza-
tion of a person’s ability through conscious or unconscious learning. Development
programmes also usually include elements of planned study and experience, and
are frequently supported by a coaching or counselling facility. In that sense training
was often perceived as being for non-managerial staff, whilst development was the
preserve of managers, and this reflected the more nebulous concepts of reasoning,
abstraction and personal growth (see Baum, 2006: 204–214 for further discussion
of this issue). Now though it is increasingly recognized that within a HRM/HRD
approach organizations will see the two aspects as being very much interconnected
so training should be seen as part of and a precondition of development.
Training and development then can be seen as a key instrument in the implemen-
tation of HRM practices and policies and there may be a number of benefits from
undertaking training. For example, McKenna and Beech (2002) suggest a number
of benefits generally stemming from training, including:
? Helps employees learn jobs more quickly and effectively.
? Improves work performance of existing employees and keeps them up to date
in specialist skills.
? Leads to a greater volume of work resulting from fewer mistakes and greater
rapidity.
? Frees management time, less of which is spent rectifying errors, also reduces
wastage.
? Can help to reduce turnover among new and established staff.
Review and reflect
If you are currently undertaking a tourism or hospitality degree to what extent do you
consider it to be training, education or development? What are some of the influences
in making your decision?
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? Incorporating safety training can help reduce accidents.
? Can help to attract good workers.
? Is a precondition for flexible working.
? Creates an attitude more receptive to coping with change.
? Operationalizing certain management techniques, for example Total Quality
Management (TQM) and empowerment (see HRM in practice 7.5).
Whether organizations accept the arguments for the benefits of training might
reflect whether they are one of two types of organizations, who are characterized
as having extreme training positions – the road to failure or the road to success.
? The road to failure
– Afailure to recognize or implement management practices designed to meet,
not only existing, but future skills needs.
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HRM in practice 7.5 Training and TQM in the
restaurant industry in Canada
Salameh and Barrows (2001) recognize how a critical element of TQM is creating an orga-
nizational culture which is supportive of quality and customer satisfaction. TQM also
requires that all members of an organization are involved in the process of quality improve-
ment. Training therefore becomes crucial to the implementation of TQM. Research con-
ducted by Salameh and Barrows in a coffee house restaurant and a casual dining restaurant
in Canada demonstrated a number of similarities in the respective restaurants. Training pro-
grammes differed from job to job depending on the complexity of the job and associated
tasks, and the length of time also varied. Both companies also used a range of training
methods, such as on-the-job training, videos, seminars and extensive induction pro-
grammes. The case study organizations also recognized the challenges of training, includ-
ing the time factor, keeping programmes simple, being proactive rather than re-active, and,
in a mirror of the intent of TQM, seeing training as a process of continuous improvement.
Managers suggested that there were a number of positive outcomes from training in
support of TQM, including decreased labour turnover, greater employee commitment,
increases in sales, greater customer responsiveness and enhanced quality service. In sum,
the research suggested that training did result in a continuous performance improvement,
a key goal in TQM.
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– An unrealistic reliance by managers upon national and local labour markets
to satisfy company skills at whatever level.
– A willingness to regard the practice of poaching the skilled labour of others
as the chief response to skill pressures, regardless of the consequences at
company level and in pay in inflation terms.
? The road to success
– Progress through the sharing of a common vision, from top management
through every level of the organization.
– High status being accorded training and development practices based upon
results and their relevance to the needs of the organization.
– Company structures which allow for the development of individuals and
encourages the acquisition of skills to meet business goals.
– Business systems flexible enough to accommodate investment in people, with
agreed budgets and clear targets subject to regular evaluation.
If we consider which one of these archetypes tends to describe tourism and hospi-
tality industry as a whole then it may well be that the balance of evidence suggests
the road to failure best describes the industry. Lucas (2004), for example, argues
that the industry remains relatively unqualified and access to training tends to be
restricted to those in large multi-establishment organizations. That said, there are,
of course, examples of sophisticated and systematic training and development
programmes in some companies (see HRM in practice 7.6).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 156
HRM in practice 7.6 The training Oscars
Set up in 1987 by the then Department for Education and Science the National Training
Awards are the UK’s number one accolade for businesses, organizations and individuals
who achieved lasting excellence and success through training and learning. In recent
years there has been some success for the tourism and hospitality industry. For example,
in 2003 five companies triumphed in a multi-sector field of 1000 entries. For the com-
petition that year entries for the national competition increased by 25 per cent, but for
the hospitality sector there was a 70 per cent rise in applicants. In the most recent awards
in 2005 Nando’s, the Chicken restaurant chain, won awards for its outdoor management
development programme and its staff training programme.
Derived from Anon (2003b); Hope (2005).
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There is also the further point that the structure of the industry in terms of firm
size. With the predominance of small firms there is greater likelihood of informal
proprietor and on-the-job training (OJT). Moreover, training incidence is at its low-
est in non-standard forms of employment, for example workers who are numer-
ically flexible are likely to get little or no training. There may be an important role
though to be played by the SSC, People 1st. The success model views training as
an integral part of core organizational strategy, rather than an ad hoc operational
issue. Moreover, this notion would seem to be a precondition for any claims to be
an HRM organization which is practicing soft HRM. Ultimately, then there may be
those organizations who see training as an investment and those who pay lip ser-
vice to the idea of training and in the good times spend money on training and in
the bad times spend less or hardly anything on training. Consequently, a lot of
organizations will, in times of skill or labour shortages, recruit from other organ-
izations rather than invest in their existing employees, something that has certainly
been apparent in tourism and hospitality.
Conducting training
We have examined in some detail the wider picture of training and in this section
of the chapter we can now move on to consider the manner in which training may
be conducted and training methods used by organization. To contextualize this
discussion it is worth noting the three broad categories in which training is likely
to be located, these are (Marchington and Wilkinson, 1996):
? Socialization initiative: Particularly in terms of induction and becoming familiar
with the prevailing organizational culture.
? Development initiative: This is more concerned with developing individuals, for
example, preparing for promotion, coping with new technology or organ-
izational change, such as attempting to become a more customer focused
organization.
? Disciplinary initiative: Where some sort of training is offered to individuals who
have fallen below the organizations acceptable level of quality, output or cus-
tomer standards, and this could be about rectifying deficiencies in technical
skills or attitudinal training.
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In terms of developing the training there is the potential for huge variations
in how organizations go about devising and delivering training. Additionally,
Marchington and Wilkinson (2005) note that trainees themselves will bring signifi-
cant ‘baggage’ to the learning event, for example the mix of prior knowledge,
skills, attitudes, motivations and expectations. Furthermore trainees may also have
very diverse reasons for being involved in the training, for example, some trainees
may be there under duress. Consequently, we should be cautious in terms of being
too prescriptive in describing how organizations should approach training.
Nevertheless, there would seem a need to have some sort of systematic approach
to developing training. For example, Go et al. (1996) advocate the need for a sys-
tematic approach as outlined in their nine-step approach to developing training
within the organization.
Step 1: Assessing training needs
Analysing training needs is a crucial part of HRD as the identification of needed
skills and active management of employee learning is integral to developing cor-
porate and business strategies. Many would argue that for training to be effective it
is necessary to discern not only the training needs of the individual and the group,
but also how their needs fit the overall organizational objectives. Essentially then
training needs analysis allow for an appreciation of the need to ensure that there is
a fit between training and the company culture, strategy and objectives. Equally,
the training needs of the individual needs to be reconciled with those of the organ-
ization. In terms of developing a training needs analysis aspects such as job
descriptions, job analysis, person specifications or whether performance objectives
agreed at appraisals have been met may all potentially be useful indicators.
Step 2: Preparing the training plan
The training plan is concerned with outlining what needs to be done based on the
training needs of individuals, departments and the organization as a whole. In effect
the training plan provides an outline sketch of what the training should address, as
well as considering practical aspects such as the method, time and location of the
training.
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Step 3: Specifying the training objectives
A key question to be asked before the training is operationalized is: what are the
training objectives? It is important when employees are undertaking training that
they understand what they should be able to accomplish when the training pro-
gramme has been completed.
Step 4: Designing the training programme
Go et al. (1996) suggest a number of issues need to be considered in designing the
training programme, including:
? Programme duration.
? Programme structure.
? Instructional methods.
? Support resources (e.g. a training facility) and the selection of training materials
(e.g. videos).
? Training location or environment, which may also be determined by the task,
for example, whether it involves practical skills.
? Instructor and instructors experience.
? Origin of the training programme.
? Criteria and methods for assessing participants learning and achievement.
? Criteria and methods for evaluating the programme.
Step 5: Selecting the instruction methods
There are a multitude of methods that organizations can use to train and develop
staff. All of these various methods will have both strengths and weaknesses and
in that sense there is no one ‘best’ training method. Rather, there is a need for
organizations to adopt a contingent approach to training in developing training
methods. Although there are a great variety of training methods, generally most
writers broadly categorize them into three different types of training, in-company
on-the-job, in-company off-the job and external off-the-job, all of which are now
briefly considered.
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In-company, on-the-job
This type of training is enduringly popular and accounts for about half of all the
training delivered across all industries and sectors in the UK (CIPD, 2005). Often
known colloquially as ‘sitting next to Nellie’, OJT training involves learning
through watching and observing somebody with greater experience perform a
task. OJT is a very popular method of training where new skills and methods are
taught to employees. The advantages of OJT is that it is cheap, the trainees get the
opportunity to practice immediately, trainees get immediate feedback and it can
also help in integrating trainees into existing teams. Equally, there may be some
drawbacks from this type of training. ‘Nellie’ may not be trained herself in skills
and methods of training, which will often lead to training being rather piecemeal
or not properly planned. Equally, Nellie may also pass on bad habits, although
increasingly organizations may use the idea of training the trainer to ensure a
more professional approach.
Another variant of OJT is mentoring, wherein a senior experienced member of
staff takes responsibility for the development and progression of selected individ-
uals. Ordinarily this process of mentoring would be for managerial staff and the
selected individual will often be somebody who has aspirations to reach senior man-
agement levels. This type of relationship is more like father–son or mother–daughter
than that of traditional master–apprentice. The trainee, or mentoree, will observe the
skills displayed by the mentor and learn from their experience. Mentoring can also
be a useful two-way process in terms of the mentor becoming more reflective about
their own job and being forced to think about ways of improving their own per-
formance. In a similar vein, shadowing allows employees the chance to see different
part of the organization in other departments. Finally, under the broader heading of
OJT is the idea of job rotation. In this approach those undergoing the training are
placed into a job without any prior training, when they have learnt that job they
move on to another job and so on, this may also eventually lead to multi-skilling or
functional flexibility, as discussed in Chapter 4.
In-company, off-the-job
In contrast to OJT, off-the-job training takes place outside of the employee’s nor-
mal place of work. Off-the job training will often involve a training intervention
run by a specialized training department. This type of training could be relatively
straightforward (see HRM in practice 7.7) or be concerned with achieving profi-
ciency in more advanced skills.
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There is a wide array of other methods that come under the broad heading of
off-the-job training. In a relatively passive sense lectures can be good for the trans-
mission of information to a relatively large number of trainees. Indeed, it is likely
that most of us in our student, organizational or professional life will have sat
TRAI NI NG AND DEVELOPMENT 161
HRM in practice 7.7 Heading off the
induction crisis
Induction is often misunderstood as simply being about inducting people into the organ-
ization during the first day in a new job. However, induction will often extend beyond the
first day and may involve events up to 12 months after the initial appointment. The need
for a period of induction is increasingly seen as being important in socializing employees,
especially in strong culture organizations, an issue considered in Chapter 3. In addition it
may also be crucial to address the problem of the so-called ‘induction crisis’, where a new
work environment can be perplexing and even frightening for new employees. As a result
employees may leave the organization during this period. Induction will not axiomatically
always avert an induction crisis, but a well-designed induction programme can go some
way to addressing this issue. Typically in inducting new employees’ tourism and hospital-
ity organizations are likely to consider the following aspects:
? History of the organization
? Consideration of the mission statement and organizational
objectives
? Outline of company ethics
? The structure of the organization
? Appearance standards
? Uniforms and dress codes
? Pay systems and benefits
? Holiday and sickness arrangements
? Rules and regulations of the organization
? Discipline and grievance procedures
? Details of any trade unions or staff associations
? Welfare policies and social facilities available in the organization
? Health and safety measures
? Introduction to immediate supervisor/line manager
? Introduction to fellow workers
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through a lecture. Often the quality of a lecture will be dependent on the individ-
ual who is delivering it. Notwithstanding this point it is generally recognized that
the maximum concentration span of most individuals is typically less than 20 min-
utes. In a rather more active vein there are a number of other methods which will
involve greater interactivity. For example, case studies, role plays and simulations
may all be usefully used by tourism and hospitality organizations, particularly in
developing customer service skills. Lastly, there may also be opportunities for
employees to learn via interactive computer learning packages, or what is often
termed e-learning, something which British Airways has developed with some
success, as outlined in HRM in practice 7.8.
External, off-the-job
The final aspect of training is that which again is undertaken off-the-job, though in
this instance it is external to the organization. In an era of continuing professional
Review and reflect
Think of any on-the-job or off-the-job training which you have undertaken in the work-
place. Which was most useful and satisfying and why?
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 162
HRM in practice 7.8 A flying start
Trapp (2003) notes how British Airways first introduced e-learning in 2000 initially to a
large degree of scepticism from their employees. Since then though the take-up of
e-learning opportunities has increased significantly amongst their staff. The technology
has been used in several ways, for example in helping with the introduction of a new check-
in system. British Airways staff are particularly drawn by the flexibility of e-learning,
which allows them to learn when they want to learn. Employees can also do as much or
as little as they wish. Elements which are covered by e-learning may be job specific, such
as allowing cabin crew staff to brush up on specialist safety training or improving knowl-
edge of wines; to more generic training such as learning how to make PowerPoint
presentations.
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development employees may be encouraged to undertake formal study to
enhance their careers, for example taking courses such as the Chartered Institute
of Personnel and Development’s courses for personnel/HRM managers or in a
more general sense a Master in Business Administration (MBA). Afurther aspect
of external off-the-job training is what is termed outward bound courses. Outdoor
training ordinarily consists of a series of exercises which act as an opportunity for
team building, problem solving or leadership skills to be developed outside of
an employee’s or manager’s ‘comfort zone’ (Trotter, 2005). In recent years such
courses have grown enormously in popularity and there have been a number of
hospitality and tourism organizations who have offered this kind of training,
including Hilton and Thomas Cook. Some castigate this type of training as a fad or
fashion with limited application to commercial situations or more seriously unsafe
or downright dangerous, especially if there is too much emphasis on physical
challenges or exercises. Some argue though that is this type of training is done
properly and managed by experienced and qualified trainers outdoor-based
development can offer a highly effective tool for improving managerial perform-
ance in particular.
Step 6: Completing the training plan
With the establishment of the main design features and the methods which are to
be used, the training plan can now be completed. Go et al. note that a complete
training plan will have details about the target group (e.g. all service staff), the
topic to be considered (e.g. customer handling), method(s) to be adopted (e.g. role
play), time (e.g. two hours) and location (e.g. conference centre).
Step 7: Conducting the training
Go et al. suggest that if other aspects of the nine-step approach are adhered to the
training activity/programme should be effectively delivered. Though rather like
Marchington and Wilkinson they do also recognize a number of factors that might
impact on the training, such as participant selection, ensuring the group feels com-
fortable physiologically and psychologically and ensuring the person delivering
the training is properly prepared and has the right skills.
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Step 8: Evaluating the training
The penultimate stage of the nine-step approach is to evaluate the training in order
to glean feedback from the trainees. There are a number of methods of evaluating
training, as identified by Holden (2004: 328):
? Questionnaires or so-called ‘happiness sheets’ are a useful way to elicit trainees’
responses to courses and programmes.
? Tests or examinations are common in more formal training courses and are
useful for checking the progress of trainees.
? Projects can be useful in providing useful information for instructors.
? Structured exercises and case studies allow for trainees to apply their learned
skills and techniques under observation.
? Tutor reports allow for instructors to offer an assessment of the utility of the
training.
? Interviews of trainees can be formal or informal, individual or group, or by
telephone.
? Observation of courses by those responsible for devising training strategies can
be very useful in the development of future training.
? Participation and discussion during the training, though this requires a highly
skilled facilitator.
? Appraisal allows for the line manager and trainee to consider the success or
otherwise of training that has been undertaken during performance reviews.
Of course a combination of these methods can be used in evaluating training and
it is likely to be important to incorporate both trainee and trainer feedback in
assessing the success or otherwise of training interventions.
Step 9: Planning further training
After the training and its evaluation, training has, in effect, come full circle and the
planning process can begin again.
Conclusion
Training and development can be understood at a number of levels and it is particu-
larly important to recognize the likely impact of government policy, in particular,
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in creating the VET infrastructure in which organizations will develop their policy
and practice. Governments may either be relatively proactive in attempting to cre-
ate an environment where training and development is seen as crucial or much
more voluntaristic in leaving such decisions to organizations. For a long time the
UK Government adopted a voluntaristic approach to training but it has become
increasingly involved in developing training initiatives in recent years to address
a perceived gap in training. In addition to the national level infrastructure we also
recognized that the sectoral level is equally important and notwithstanding the
emergence of initiatives such as Excellence in People and Welcome Host, tourism
and hospitality has often been perceived as a sector with an indifferent training
record. Notwithstanding debates about the provision or otherwise of training in
tourism and hospitality when organizations do train they can draw upon a variety
of differing methods, which are likely to differ in relation to differing occupations
and skills. In that sense there is no one best training method, but rather different
methods and techniques will be appropriate given the nature of the task and skills
demands and importantly what is most cost effective for organizations.
References and further reading
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Anon (2003a) ‘Staying the course’, Hospitality, March, 16–17.
Anon (2003b) ‘Hospitality companies fare well in training awards’, Caterer and Hotelkeeper, 18 December, 10.
Armstrong, M. (1999) A Handbook of Human Resource Management Practice, Kogan Page,
7th edition.
Baum, T. (2006) Human Resource Management for Tourism, Hospitality and Leisure: An International
Perspective, Thomson Learning.
Chartered Institute of Personnel and Development (2005) On-the-Job Training Factsheet, CIPD.
Chartered Institute of Personnel and Development (2006) Investors in People Factsheet, CIPD.
Druce, C. (2004) ‘NVQs fail to meet the industry needs, agree colleges and employers’, Caterer and
Hotelkeeper, 21 October, 9.
Druce, C. (2005) ‘Hospitality waits for People 1st to deliver results on skills crisis’, Caterer and Hotelkeeper,
12 May, 6.
Finegold, D., Wagner, K. and Mason, G. (2000) ‘National skill-creation systems and career paths for service
workers: hotels in the United States, Germany and the United Kingdom’, International Journal of
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Foote, R. (1999) ‘NVQs: tension from both sides’, Hospitality Review, October, 12–16.
Georgeson, R. (1999) ‘Case studies: Investors in People: Ruffles Country House Hotel, St Andrews and The
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Go, F., Monachello, M. and Baum, T. (1996) Human Resource Management for the Hospitality Industry,
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Keep, E. (2005) ‘Skills, training and the quest for the holy grail of influence’, in S. Bach (ed.) Managing
Human Resources: Personnel Management in Transition, Blackwell, 4th edition, 211–236.
Kidger, P., Jackson-van Veen, M. and Redfearn, D. (2004) ‘Transferring the Investors in People concept from
the UK to The Netherlands’, Journal of European Industrial Training, 28(6), 499–518.
Lucas, R. (1995) Managing Employee Relations in the Hotel and Catering Industry, Cassell.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
Manson, E. (2005) ‘Hospitality lags behind other industries over apprenticeship scheme’, Caterer and
Hotelkeeper, 7 April, 8.
Marchington, M. and Wilkinson, A. (1996) Core Personnel and Development, CIPD.
Marchington, M. and Wilkinson, A. (2005) Human Resource Management at Work: People Management
and Development, CIPD, 3rd edition.
Mason, A. (1997) ‘Apprenticeships – do they work?’ Hospitality, September/October, 26–27.
McKenna, E. and Beech, N. (2002) Human Resource Management: A Concise Analysis, Pearson Education
Limited.
People 1st (2004) ‘Permanent CEO for new skills body’, People 1st Press Release, 7 October 2004.
Qualifications and Curriculum Authority (2003) Establishing Qualification Requirements: Hospitality and
Catering Industry, QCA.
Salameh, M. and Barrows, C. (2001) ‘The role of training in achieving TQM in restaurants’, Journal of
Quality Assurance in Hospitality and Tourism, 1(4), 73–95.
Scott, A. (1999) ‘Investing in people?’ The Hospitality Review, January, 25–30.
Scottish Tourism Research Unit (1998) International Benchmarking and Best Practice Study of Training and
Education for Tourism, STRU.
Sweeney, A. (1995) ‘Improving interpersonal relationships between staff and visitors with the “Welcome
Host” scheme’, Proceedings of the Fourth Annual Council for Hospitality Management Education
(CHME) Research Conference, University of Brighton, 101–119.
Trapp, R. (2003) ‘A flying start’, People Management, 6 February, 36–38.
Trotter, A. (2005) ‘Smells like team spirit’, Guardian Office Hours, 21 March, 2–3.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 166
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Websites
Details of the various programmes run by Welcome Host can be found at http://www.welcometoexcellence.
co.uk/WIIndex.htm
Details of the British Hospitality Association’s Excellence Through People scheme can be found at http://
www.etp.org.uk/Home/Default.aspx
Investors in People has a number of case studies, including several from the tourism and hospitality sector at
http://www.iipuk.co.uk/IIP/Web/Case+Studies/default.htm
For details of the UK training and education framework visit the QCA website at http://www.qca.org.uk/
The American Society for Training and Development has some useful resources on workplace training and
learning at http://www.astd.org/astd
TRAI NI NG AND DEVELOPMENT 167
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Chapter 8
Performance
management and
performance appraisal
Chapter objectives
This chapter discusses performance management
and performance appraisal. Specifically, the aims
of the chapter are:
? To appreciate the difference between
performance management and performance
appraisal.
? To consider challenges facing tourism and
hospitality managers in operationalizing
performance appraisal schemes.
? To explore the differences between evaluative
and developmental aspects of performance
appraisal.
? To recognize the range of skills required by
tourism and hospitality managers to
successfully conduct performance appraisals.
168
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Introduction
In considering the nature of performance management and performance appraisal
we firstly need to appreciate how these two aspects are related but equally should
not be seen synonymously. In fairly simple terms performance management can
be seen as a holistic process which aims to bring together a number of aspects,
including appraisal. Thus, performance management may be thought of as being
more strategic in its intent to achieve high levels of organizational performance. By
contrast, performance appraisal is best seen as being more operationally focused,
with a focus on individual employees short- to medium-term performance and
development (CIPD, 2005a). Consequently, to fully contextualize the notion of per-
formance appraisal it is important to locate it within wider issues concerned with
performance management systems (PMS) which may have an organizational, team
or individual focus. Armstrong (2001: 469) suggests that performance management
has a number of aims:
Performance management is about getting better results from the organiza-
tion, teams and individuals by understanding and managing performance
within an agreed framework of planned goals, standards and competing
requirements. It is a process for establishing shared understanding about
what is to be achieved, and an approach to managing and developing people
in a way which increases the probability that it will be achieved in the short
and long term. It is owned and driven by management.
Clearly, then, organizations are always seeking improvements in their perform-
ance and these can be sustained by either development-type initiatives or more
evaluative or even punitive measures, potentially encompassing aspects of discip-
line. In that sense performance management and performance appraisal can
arguably be seen to again reflect to some degree the notions of ‘hard’ and ‘soft’
HRM. For example, the harder approaches would point to the need for organiza-
tions and managers to seek control over their employees; on the other hand softer
approaches would point to the role of PMS in establishing greater commitment
and developing careers. Recognizing the above discussion this chapter will aim to
consider the question of what options are open to an organization seeking to
improve the performance of its employees.
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The nature of performance management and
performance appraisal
Recent research undertaken by the CIPD provides a snapshot of a number of fea-
tures of performance management, as outlined in Table 8.1.
Clearly one of the most important aspects of enhancing performance is per-
formance appraisal, which is a critical element of performance management and a
key feature of organizational life. As Bach (2005: 289) notes, ‘performance appraisals
have become far more than just an annual ritual and are viewed as a key lever to
enhance organizational performance’. Performance appraisal is defined by Heery
and Noon (2001: 7) as, ‘… the process of evaluating the performance and assessing
Table 8.1 Features of performance management
Feature Percentage
Individual annual appraisal 65
Objective setting and review 62
Personal development plans 62
Career management and/or succession planning 37
Coaching and/or mentoring 36
Competence assessment 31
Performance related pay 31
Self-appraisal 30
Twice yearly/biannual appraisal 27
Continuous assessment 14
360-degree appraisal 14
Subordinate feedback 11
Rolling appraisal 10
Peer appraisal 8
Competence related pay 7
Team appraisal 6
Contribution related pay 4
Team pay 3
Source: This material is taken from Managing Performance: Performance
Management in Action by Armstrong, M. and Baron, A., 2nd edition (2005), with
the permission of the publisher, the Chartered Institute of Personnel and
Development, London.
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the development/training needs of an employee’. LRD (1997: 3) similarly note
how performance appraisal is, ‘A process of reviewing individual performances
against pre-determined criteria or objectives, involving the gathering of informa-
tion, one or more meetings and some form of report which may include a per-
formance rating’. In sum, then, appraisal is a process that allows for an individual
employee’s overall capabilities and potential to be assessed for the purposes of
improving their performance.
A recent survey by IRS (2005a) suggests that over 90 per cent of workplaces
have some form of performance appraisal, usually a conventional top-down
appraisal system. Moreover there has been a shift in recent years which have seen
more and more organizational members subject to such appraisal, which had trad-
itionally been geared more to managerial staff. Clearly given the skills mix which
was discussed in Chapter 4, which points to a predominance of semi and unskilled
workers in tourism and hospitality, there may well be a questioning of whether it
is worthwhile appraising such workers, especially unskilled workers, as these jobs
are likely to involve little technical expertise. For example, notwithstanding the
earlier point about more organizational members being appraised, IRS (1999) sug-
gested that less than a quarter of organizations across the economy as a whole sur-
veyed semi or unskilled workers. If these employees are to be appraised some
difficulties may be encountered in attempting to establish readily observable stand-
ards and criteria by which performance can be measured. There may also be the
additional issue in tourism and hospitality of the predominance of small- and
medium-sized enterprises. Goldsmith et al. (1997) note that appraisal is unlikely to
be something that is realistic for a small family-concern type business or a single
person operation. Consequently they advocate that appraisal has certain min-
imum requisites or parameters, including (p. 165):
? the equivalent of at least 20 full-time non-managerial employees;
? a minimum of one layer of professional management between the organization’s
proprietor and operative staff;
? some evidence of departmentalization where individual departments have their
own heads or supervisors.
Given the above discussion it might seem reasonable to imagine that appraisal is
less likely to be a part of a systematic approach to HRM in tourism and hospitality.
However, the evidence seems to suggest that the opposite may in fact be true. For
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example, Lucas (2004) in her interrogation of the Workplace Employee Relations
Survey data, found that 85 per cent of managers in the hospitality and tourism
industry had responsibility for performance appraisal. Interestingly, Lucas also
found that performance appraisal is more likely to be used in the hospitality
industry compared to all private sector service organizations. Similarly, Hoque
(1999) found that 89 per cent of the 232 hotels he surveyed regularly used appraisal,
compared to 62 per cent of similar sized establishments in manufacturing. Woods
et al. (1998) also found a high incidence of appraisal within the US. In a survey of
1000 hotels covering all geographic areas, all types of market segment, ownership
type, size and number of employees Woods et al. found that two-thirds of his sam-
ple had an annual appraisal. Clearly appraisal then is a significant part of broader
HRM concerns in hospitality and tourism and we can now go on to consider some
of the challenges facing managers in operationalizing appraisal schemes.
Appraisal in practice
To begin to assess the impact of performance appraisal we should start with a sim-
ple question: Why should organizations appraise people at work? Arange of writers
(see e.g. Bach, 2005; IRS, 2005a, b) suggest a number of reasons, including:
? Appraisal can be an integral part of ensuring that organizational members are
aware of what is expected of them and can thus play an important part in social-
izing organizational members to ‘ buy in’ to the organizational culture. For
example, Groeschl and Doherty (2002: 58) note how, ‘Its value as an organiza-
tional socialization process is closely associated with organizational attempts
to manage “culture”, another essential element of the HRM approach to the
employment relationship’. Indeed, Bach (2005) notes that increasingly organ-
izations are now using performance management as a means to introduce cul-
tural changes in organizations.
? Improve current performance.
? Provide feedback: We all seek approval and conformation that we are doing the
right thing, and we also like to advise or direct others on how they should do
things.
? Increase motivation.
? Identify training and development needs.
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? Identify potential.
? Let individuals know what is expected of them.
? Focus on career development and succession planning.
? Award salary increases/performance related pay.
? Evaluate the effectiveness of the selection process.
? Solve job problems.
? Set objectives: Using the SMART mnemonic, specific or stretching (define pre-
cisely what is required in clear language), measurable (both quantitatively and
qualitatively), accepted (objectives agreed and not imposed), realistic (achiev-
able and fairly allocated) and time-bound (clear target dates). For example, in a
tourism and hospitality context it might be things like servers trying got
increase their sales per shift, chambermaids cleaning more rooms, receptionists
attempting to become more skilled in information technology, improving com-
munication skills or learning to speak a foreign language.
In reality, in most workplaces staff are being continually monitored and assessed by
management in an informal manner. Indeed, ACAS (2005: 2) suggest that, ‘regular
dialogue between managers and their staff about work performance should, of
course, be encouraged’. That said, the danger with such informality is that it is very
much dependent on individual managers and whether they are giving regular feed-
back. Consequently, ACAS further note that an appraisal system can develop a
greater degree of consistency by ensuring that managers and employees meet for-
mally and regularly to discuss performance and potential. What we are concerned to
examine in this chapter is the formalized manner by which staff are assessed during
performance appraisals. That is, the process of reviewing individual performance
against pre-determined criteria or objectives, involving the gathering of information
and one or more meetings on a quarterly, 6 monthly or annual basis, and producing
some form of report which is likely to include a performance rating. As described
above performance appraisal can be seen in a fairly positive vein and useful in terms
of things like raising morale, clarifying expectations, improving upward and down-
ward communication and so on (and see HRM in practice 8.1).
Review and reflect
What are some of the likely difficulties in appraising employees in tourism and hospitality?
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Despite the above discussion, which points to why performance appraisal might
be thought of as a ‘good’ thing, in reality there is much debate and concern sur-
rounding the notion of appraisal. For example, W. Edwards Deming, a leading
advocate of TQM, has suggested that appraisal is wrong in principle and an inef-
fective management philosophy, describing it as a ‘deadly disease’ (cited in Bach,
2005). Similarly, Stephen Covey, the well-known management guru, has described
appraisal as a ‘disgusting habit’, outmoded and more suited for an industrial age
that no longer exists (cited in IRS, 2005a). Indeed, as long ago as 1957 the famous
management theorist Douglas McGregor, of Theory X and Y fame, was suggesting
that appraisal is the most contentious and least popular part of a manager’s job.
Managers dislike the process as they do not like ‘playing God’, which leads to a
judgemental and ultimately de-motivating approach:
The respect we hold for the inherent value of the individual leaves us dis-
tressed when we must take responsibility for judging the personal worth of
a fellow man. Yet the conventional approach to performance appraisal forces
us, not only to make such judgements and to see them acted upon, but also
to communicate them to those we have judged. Small wonder we resist!
(McGregor, 1957: 90).
HRM in practice 8.1 Appraisal: Some
good news
Research conducted by Armstrong and Baron (2005) on behalf of the Institute of
Personnel and Development in the late 1990s found that employees and managers
offered favourable rather than unfavourable views on appraisal. Some of the comments
from the research included:
‘You need appraisal to get the best out of people and develop them.’
‘In a one-to-one meeting, people can bring things out to their supervisors who say
“I’ve never been aware of that: why didn’t you tell us before?” That’s definitely an
advantage.’
‘For me, the real strength of the process lies in the continuing dialogue and negoti-
ation as the year goes on.’
‘You’re one-to-one with your boss. You’ve chatted, and it wasn’t as if it was your
boss. It was more relaxed. He would listen and then you’d chat about it. I enjoyed it.’
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Managers may also regard appraisal as a waste of time and overly bureaucratic
and may also see it as a process that involves relatively high costs in setting up the
scheme and training employees in using the scheme (and see HRM in practice 8.2).
In part, some of these negative views of appraisal could potentially be
addressed by training for managers to ensure that they are clear of the importance of
appraisal. For example, IRS (2005a: 9) note that, ‘if managers are not properly
trained and committed to the appraisal system, the performance review can become
just a paperwork exercise, at best, or – at worst – a harmful one’. This view points to
the issue of whether appraisals per se are problematic or whether much of the prob-
lem lies in carrying out the appraisal, specifically whether appraisals are performed
poorly by uninterested or badly trained managers. Training, then, may help man-
agers to appreciate the importance of appraisal within a broader performance man-
agement approach and also the need to develop coaching skills to facilitate a more
developmental approach.
Such training may be appropriate in attempting to address some of the problems
which may plague appraisal such as (Bach, 2005; Torrington et al., 2005; IRS, 2005a):
? Prejudice, for example, sex or race discrimination.
? Subjectivity and bias, especially with regard to rater bias.
? Insufficient knowledge of the appraisee – so appraiser position is based on pos-
ition in hierarchy, rather than any real knowledge of person’s job.
? The ‘halo’ and ‘horns’ effect where managers rate employees on the basis of their
personal relationships rather than by objective measure of their competencies and
abilities.
HRM in practice 8.2 Appraisal: Some
common negative managerial thoughts
about appraisal
‘Well, here we go again, I’m sure you don’t like this business any more than I do, so let’s
get on with it.’
‘Now, there’s nothing to worry about. It’s quite painless and could be useful. So just
relax and let me put a few questions to you.’
‘I wonder if I will end up conning you more than you will succeed in conning me.’
‘Right. Let battle commence!’
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? The problem of context – the difficulty of distinguishing the work of appraisees
from the context in which they work, especially when there is a degree of com-
parison with other appraisees.
? What might be termed the ‘paradox of roles’ in terms of the conflation of judge
and counsellor (mentor) role which can lead to confusion. For example, in the
shift from an evaluative to a developmental approach managers have to man-
age such tensions.
? The paperwork – overly bureaucratic and simply about form filling.
? The formality – for both appraiser and appraisee it can be an uncomfortable
experience.
? Outcomes are ignored.
? Everyone is ‘average or just above average’, for example, managers may find it
difficult to give an employee a bad rating as they would not want to justify the
criticisms in the performance review interview.
? Appraising the wrong features – too much stress on easily identifiable things
like timekeeping, looking busy, being pleasant and so on.
? ‘Recency bias’ leading to a tendency to base appraisals on the recent past, regard-
less of how representative it is of performance over the course of the previous
year.
In many respects the above issues reflect what Bach (2005) calls the ‘orthodox cri-
tique’, wherein many of the problems above could potentially be addressed by
seeking to remedy the imperfections in the design and implementation of the
appraisal system or by improving managerial training in conducting appraisals.
For some though there may well be much more fundamental criticisms to be made
about the process of appraisal.
Bach (2005) notes the emergence of more critical accounts of appraisal, in par-
ticular recognizing how, ‘unitary assumptions about the benevolent purposes of
appraisal are replaced by a more radical ideology concerned to examine managerial
objectives, especially tighter control over behaviour and performance, the potential
to individualize the employment relationship and the scope for managers to use
appraisal as a veneer to legitimate informal management’ (p. 305). For example,
many of the criticisms, drawing on the work of Foucault, see appraisal as inherently
sinister and about aiming to control all aspects of employee behaviour and eliminat-
ing scope for employee resistance, so appraisal is simply about bolstering man-
agerial power and control; a point that is similar to some of the criticisms of
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organizational culture outlined in Chapter 3. In sum, Bach suggests that critical
perspectives seek to highlight that it should not be assumed that clearer objectives
and training of appraisers will necessarily yield satisfactory results. Consequently
it is important to recognize how, ‘the contested nature of appraisal, the specific
managerial objectives sought, and the nature of the context in which it is applied,
all have an important bearing on the impact of the appraisal process’ (p. 306).
Thus, we can appreciate that appraisal is very much a contested issue, both con-
ceptually and practically. Equally, though, as Holdsworth (1991: 65) rightly suggests,
‘appraisal is a compulsively fascinating subject, full of paradoxes and love–hate rela-
tionships. And appraisal schemes are really controversial … Some schemes are popu-
lar, with overtones of evangelical fervour, while others are at least equally detested
and derided as the “annual rain dance”, “the end of term report”, etc.’ (and see HRM
in practice 8.3 for how a number of the issues discussed above were played out
within ANO, a French hotel chain, which introduced a new appraisal system).
Ultimately, despite the debates surrounding its utility, appraisal is a fact of
organizational life, and as Bratton and Gold (2003: 252) note, ‘making judgements
about an employee’s contribution, value/worth, capability and potential has to be
considered as a vital relationship with employees’. Moreover, as we noted above
there may be an argument, rather like employment interviewing, to say that the
process in itself is not necessarily flawed, but the individuals operationalizing it
are insufficiently skilled.
Given the reality of performance appraisal being an inevitable part of a manager’s
life we can now look at the practicalities in appraising employees. In appraising
employees a number of writers have outlined two main perspectives the evalu-
ative and the developmental. In the former approach the main aim is to make a
judgement about an appraisees performance, with such a judgement being made
against aspects such as the job description and established objectives, which may
be linked to extrinsic rewards. Often this will also involve managers making rating
or ranking decisions that differentiate between staff on the basis of their relative
Review and reflect
What are some of the skills likely to be required by managers in order to conduct a good
appraisal?
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HRM in practice 8.3 The rhetoric and reality
of appraisal in ANO Hotels
Groeschl and Doherty (2002) report on the introduction of a new appraisal system in
ANO, which is part of a French multinational travel and tourism group and operates at
the three star level. In 1998 a standardized appraisal system was developed for the com-
pany as a whole in order that it could be implemented in all their brands, including ANO.
This attempt at standardizing appraisal was to ensure that all employees across the com-
pany’s various brands would be appraised against the same criteria to ensure a consistent
evaluation of employee performance. The new appraisal system was developed at the
corporate headquarters and the working group which developed the system initially
evaluated the old system to identify weaknesses. Once this was done they then developed
suggestions and proposals for the new system, which were then sent to regional man-
agement teams for their comments and feedback. These exchanges continued for
6 months before finally there was agreement on the standardized criteria and a number
of aims and objectives. A key aim of the new system was to ensure a basis for planning
for action, particularly with regard to career progress. The new appraisal system was an
example of a development-oriented appraisal system and the appraisal format was con-
sidered a formal and sophisticated document. Employees were assessed with ratings
ranging from ‘very good’ to ‘insufficient’ on 13 standardized competencies, including
aptitudes and skills. Although the process of introducing a new appraisal system seemed
well planned and thought out there was still some issues that emerged. For example,
some managers seemed unable to sufficiently differentiate from day-to-day feedback
with the formal appraisal process. Appraisers would also often be inconsistent in their
preparation for appraisal, failing to notify appraisees sufficiently in advance or not filling
in the appraisal form correctly. Appraisers would also often run appraisals in public
spaces, such as bars and restaurants, which runs counter to the advice often offered in
textbooks. Lastly, there was also significant variance in the appraisers style. Some
appraisers recognized the developmental nature of the new system and developed an
advisory/supportive role in the appraisal; whilst others were much more judgemental and
authoritarian. In sum, although ANO had clear objectives, documentation and guide-
lines, all of which reflected good practice HRM, the implementation proved rather trick-
ier. Closer monitoring of the process by the HR managers, or line managers with a strong
interest/involvement in HRM could have improved the situation. Equally, the case seems
to point to the need to provide managers with the appropriate skills which allows them
to take on more of a facilitator or coaching role in the appraisal process.
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performance. On other hand, developmental approaches are likely to have a differ-
ent premise, where the appraiser and appraisee aim to discuss the progress, hopes
and fears of the appraisee in a mutually supportive atmosphere and where the
ultimate aim is on developing performance by building on employees strengths
(and see HRM in practice 8.4).
In reality, within any given organizational setting there may not be such an
absolute and clear cut distinction and their may be elements of both evaluative
and developmental approaches, such that the purpose of performance appraisal
has tended to oscillate between concerns about short-term performance to a more
developmental orientation. Appraisal has also been used as a disciplinary tool by
some organizations, with poor performance being something that appraisals sys-
tems have sought to address, a point to which we will return later. As we have
already noted above though the character and emphasis of appraisal has increas-
ingly changed in recent years. For example, Bach (2005: 291) notes how:
During the 1990s there was a shift from almost exclusive emphasis on reward
driven systems, based on individual performance related pay and quantifi-
able objectives, towards more rounded systems of performance management
with a stronger developmental focus.
HRM in practice 8.4 Appraisal talking
points: Evaluating or developing?
As we have already noted there may be some debate as to whether performance reviews
of appraisals should be evaluative or developmental. Consider how you would respond
to the talking points below in assessing this conundrum.
Talking point 1
As part of an appraisal process you want to tell a member of staff in your travel agency
that you feel as though they lack initiative and that this is severely hindering their per-
formance in their front-line job. How do you approach this issue?
Talking point 2
Should appraisal be linked to pay?
Talking point 3
Should appraisal look forwards or backwards?
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We will consider this point in due course. However, it is important to recognize
that many appraisal systems will still retain attempts to measure performance,
often using a variety of techniques. For example, Woods et al. (1998) found that
hotels in their survey used one or more of four approaches, these being manage-
ment by objective (MBO) (48 per cent), behaviourally anchored rating scales (BARS)
(41 per cent), narrative essay (37 per cent) and graphic rating scale (28 per cent).
Other methods which organizations may use include performance standards and
matching performance against job descriptions, rating an employee based on a scale,
which may for example range from ‘outstanding’ to ‘unacceptable’ and critical
incidents (and see also HRM in practice 8.5).
HRM in practice 8.5 gives an indication of the types of activities which may be
assessed in judging the performance for managers in the tourism and hospitality
industry. Clearly, in addition to these aspects there may be a range of other attrib-
utes that can be used to measure the individual performance of an employee. For
example, CIPD (2005b) reporting on a survey of over 500 organizations across the
HRM in practice 8.5 The use of BARS in the
American hotel industry
BARS aims to evaluate managers’ actions. Umbreit et al. (1986) developed a BARS format
to evaluate what hotel managers do in their jobs using seven rating scales for a number
of key aspects of job performance. The aspects of job performance were: communica-
tion skills, handling guest complaints and promoting guest relations, developing market-
ing strategies and monitoring sales programmes, motivating and modifying employee
behaviour, implementing policy, making decisions, and delegating responsibilities, moni-
toring operations and maintaining product quality and handling personnel responsibil-
ities. For example, with regard to communication skills, at the top of the scale at 7 is a
manager who communicates effectively by for example calling a meeting to explain why
the hotel will be cutting staff. In the middle is a manager who communicates satisfactor-
ily between 4 and 5, for example, a manager who meets with several employees once a
week for an informal talk about the hotel’s activities. Lastly, at the bottom is a manager
who experiences difficulties in communicating with staff at 1–2, for example, during an
executive meeting a manager who dismisses a subordinates comments as stupid.
Source: Woods et al. (1998).
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economy outline a number of criteria and their relative importance to how organ-
izations measure individual performance, and these are considered in Table 8.2.
Similarly, IDS (1989, cited in McKenna and Beech, 2002) suggest a number of
performance factors which are likely to be appraised, the most important being:
? Knowledge, ability and skill on the job.
? Attitude to work, expressed as enthusiasm, commitment and motivation.
? Quality of work on a consistent basis and attention to detail.
? Volume of productive output.
? Interaction, as exemplified in communication skills and ability to relate to
others in teams.
As we noted above though the focus of appraisal is increasingly argued to be shifting
to one of a more developmental focus. Given that much of the discussion above has
outlined an approach to appraisal which is predominately top-down, there may be
Table 8.2 Criteria used to measure individual performance
Respondents (%)
Very Important Not very Not used as a
important important measure
Customer care 45 40 7 5
Quality 47 44 3 4
Flexibility 22 56 13 4
Competence 53 40 3 2
Skills/learning targets 18 57 16 4
Business awareness 17 52 21 6
Working relationships 35 53 7 3
Contribution to team 34 57 4 2
Financial awareness 11 47 28 10
Productivity 34 49 9 6
Aligning personal 29 48 16 4
objectives with
organizational goals
Achievement of objectives 52 42 3 1
Source: This material is taken from Performance Management Survey Report by CIPD (2005), with the
permission of the publisher, the Chartered Institute of Personnel and Development, London.
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other approaches, which may be seen as less biased and potentially offering greater
scope for development. Some of these other approaches are now briefly discussed.
Self-appraisal: Bach (2005) notes the manner in which the appraisal process in a
number of organizations increasingly expects employees to take greater owner-
ship, ‘with employees assigned greater responsibility for establishing their own
performance goals and for obtaining feedback on their performance’ (p. 293). With
self-appraisal, then, instead of employees’ being passive recipients of their line
manager’s appraisal they are increasingly involved via some form of self-assessment,
often being more critical than if the manager conducted the appraisal (McKenna
and Beech, 2002). In such an approach employees are increasingly expected to take
the lead in the discussions – it should not just be a case of downwards feedback
from the line manager. Indeed, in some instances employees may draft their own
performance reviews, which then forms the basis for the discussion with their line
manager (IDS, 2005).
Peer appraisal: Fellow team members, departmental colleagues or selected indi-
viduals with whom an individual has been working provide the assessment of
performance.
Upward appraisal: Managers are appraised by their staff (and see the discussion
of attitude surveys in Chapter 10).
Customer appraisal: Redman (2006) notes the increasing importance of customers
in the appraisal process, which in part reflects the emergence and development of
TQM and customer care programmes. As he recognizes, ‘one impact of these initia-
tives is that organizations are now increasingly setting employee performance stand-
ards based upon customer care indicators and appraising staff against these’ (p. 163).
For example, Redman notes how these can be both in terms of ‘hard’ quantifiable
measures, such as whether a drink is delivered in a certain amount of time in a
restaurant; to ‘soft’ measures, which are more qualitative, such as whether a warm
and friendly greeting is given by staff in giving the customer the drink. Moreover,
Redman notes the use of service guarantees, ‘which involve the payment of com-
pensatory moneys to customers if the organizations do not reach the standards’
(p. 163), which again also means a greater use of customer data in appraisal ratings.
In terms of the use of customer service data and how it may be used to appraise
employees, Redman notes how it can be gathered by a variety of means.
? Customer surveys: Organizations are now becoming increasingly sophisticated
in the manner in which they gather customer feedback, which is gathered via a
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number of means such as the use of customer care cards, telephone surveys,
interviews with customers and postal surveys.
? Range of surveillance techniques: Managers may ‘sample’ the service encounter.
For example, if a travel company had a call centre managers could listen to
some of the calls between customers and the call centre operatives.
? ‘Mystery’ or ‘phantom’ shopper: Mystery shoppers observe and record their experi-
ence of the service encounter and report these findings back to the organization.
Although this method may be seen as rather controversial – employees may
view the mystery shoppers as ‘spies’ or ‘snoopers’ and indulge in ‘shopper
spotting’ – it is widely used in the tourism and hospitality industry. Redman
argues that the controversy surrounding mystery shoppers may be dissipated
to an extent if they are used primarily for encouraging and rewarding good per-
formance, rather than punishing staff for performing poorly.
Customer feedback may be used as a stand-alone aspect of performance manage-
ment, or may be an integral part of 360-degree feedback.
Multi-rater or 360-degree feedback: CIPD (2006) notes how 360-degree feedback has
been increasingly talked about, if not necessarily widely used. Performance data is
generated from a variety of sources, which can include the person to whom the indi-
vidual being assessed reports, people who report to them, peers (team colleagues or
others in the organization), and internal and external customers. It may also include
self-assessment and will often be part of a self-development or management devel-
opment programme. 360-degree feedback is felt to provide a more rounded view of
people, with less bias than if an assessment is conducted by one individual.
The practicalities: the appraisal form and interview
Most PMS are likely to have a formal final performance review, where an individ-
ual employee is assessed against their objectives (inputs and outputs). This review
Review and reflect
If you have been subject to any of the above aspects in your working life in tourism and
hospitality how did you feel about being assessed by these means? Did you feel that it
gave a fair representation of your performance?
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is also likely to allow for a review of training and development needs. With regard
to the practicalities of conducting the review, it is likely that most companies will
use the appraisal form to structure the discussion. ACAS (2005) notes how most
performance appraisal forms should contain provision for:
? basic personal details, such as name, department, post, length of time in the job;
? job title;
? job description;
? a detailed review of the individual’s performance against a set of job related
criteria;
? an overall performance rating;
? general comments by a more senior manager;
? comments by the employee;
? a plan for development and action.
In approaching the appraisal interview the discussion to date gives a sense of
some of the potential pitfalls that might befall a manager in conducting an
appraisal interview. To an extent as well the nature and tone of the appraisal inter-
view will be dictated by whether a scheme is seeking a broadly evaluative
or developmental approach. That said, Torrington et al. (2005) in their review of
appraisal interviewing advocate the need to seek an approach which is con-
cerned with seeking joint approaches to enhance performance. Underpinning
such an approach is a problem-solving style, which is summarized in the follow-
ing manner:
The appraiser starts the interview by encouraging the employee to identify
and discuss problem areas and then consider solutions. The employee there-
fore plays an active part in analysing problems and suggesting solutions, and
the evaluation of performance emerges from the discussion at the appraisal
interview, instead of being imposed by the appraiser upon the employee
(Anderson, 1993: 102, cited in Torrington et al., 2005: 341).
Much of the above discussion points to the need for managers to have the right
skillset that allows them to appraise well; as well as understanding how appraisal
fits in to the wider issue of performance management and organizational strategy
generally. In terms of practical skills though there may be aspects such as asking
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the right questions, the ability to be a good listener and giving useful feedback. In
sum, CIPD (2005a: 4) offers a view on what ‘good’ and ‘bad’ appraisals look like:
On the one hand a ‘good’ and constructive appraisal meeting is one in which:
? Appraisees do most the talking.
? Appraisers listen actively to what they say.
? There is scope for reflection and analysis.
? Performance is analysed and not personality.
? The whole period is reviewed and not just recent or isolated events.
? Achievement is recognized and reinforced.
? Ends positively with agreed action plans.
On the other hand a ‘bad’ appraisal meeting:
? Focuses on a catalogue of failures and omissions.
? Is controlled by the appraiser.
? Ends with disagreement between appraiser and appraisee.
Managing poor performance
Of course there is always the potential issue of how to manage poor performers and
a clear rationale for the introduction of PMS is to seek to identify and address any
instances of poor performance. If a PMS is underpinned by regular meetings, feed-
back and coaching then these issues should be picked up relatively quickly.
Organizations can then attempt to address poor performance through some form of
improvement development programme, which will often involve employees being
given extensive help in the form of training and coaching. Armstrong (2001: 484–485)
suggests that there are five basic steps in handling performance problems:
1 Identify and agree the problem through analysing feedback and getting agree-
ment from the employee what the shortfall has been.
2 Establish the reason(s) for the shortfall and avoid crudely attaching blame for
problems in the job.
3 Decide and agree on the action required, whether it be things like a change in
attitude, behaviour or improvements in certain skills or abilities.
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4 Resource the action by providing coaching, training and guidance to ensure that
changes can be made.
5 Monitor and provide feedback, which may also include an element of self-
management in the learning process.
Thus, as IDS (2005: 9) notes, ‘in this way, most poor performers will either improve to
a satisfactory level within a given timescale or as a last resort would be liable for dis-
missal under capability procedures’, an issue that is further discussed in Chapter 12.
Conclusion
Despite concerns performance appraisal remains a key part of organizational life.
Often an integral part of a broader PMS performance appraisals are a crucial, if rather
unloved, part of a manager’s job. We recognized in the chapter how debates about
performance appraisal may not just reflect fundamental criticisms but also more pro-
saic issues, such as managers not having the necessary skillset to conduct appraisals
which are more developmentally oriented in particular. Many of these issues are par-
ticularly pronounced in the tourism and hospitality sector where the predominance
of SMEs, the nature of the skills mix in the industry and difficulties in judging ‘softer’
and less quantifiable aspects of performance may all mean that the development of a
systematic approach to appraisal remains problematic. Nevertheless evidence sug-
gests that the majority of tourism and hospitality organizations are seeking to
appraise their employees. Given this reality it is important for organizations and
managers to recognize the challenges in conducting positive appraisals. Recognition
of these challenges and the skills needed to address them means that ‘playing God’
may not be quite so painful for managers as has often been the case in the past.
References and further reading
Advisory, Conciliation and Arbitration Service (2005) Employee Appraisal, ACAS.
Armstrong, M. (2001) A Handbook of Human Resource Management Practice, Kogan Page, 8th edition.
Armstrong, M. and Baron, A. (2005) Managing Performance: Performance Management in Action, CIPD.
Bach, S. (2005) ‘New directions in performance management’, in S. Bach (ed.) Managing Human
Resources: Personnel Management in Transition, Blackwell, 4th edition, 289–316.
Bratton, J. and Gold, J. (2003) Human Resource Management – Theory and Practice, Palgrave, 3rd edition.
Chartered Institute of Personnel and Development (2005a) Performance Appraisal Factsheet, CIPD.
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PERFORMANCE MANAGEMENT AND PERFORMANCE APPRAI SAL
Chartered Institute of Personnel and Development (2005b) Performance Management Survey Report,
CIPD.
Chartered Institute of Personnel and Development (2006) Performance Management Factsheet, CIPD.
Goldsmith, A., Nickson, D., Sloan, D. and Wood, R. (1997) Human Resources Management for Hospitality
Services, International Thomson Business Press.
Groeschl, S. and Doherty, L. (2002) ‘The appraisal process: beneath the surface’, Journal of Human
Resources in Hospitality and Tourism, 1(3), 57–76.
Heery, E. and Noon, M. (2001) A Dictionary of Human Resource Management, Oxford University Press.
Holdsworth, R. (1991) ‘Appraisal’ in F. Neale (ed.) The Handbook of Performance Management, IPM,
64–81.
Hoque, K. (1999) ‘New approaches to HRM in the UK hotel industry’, Human Resource Management
Journal, 9(2), 64–76.
Income Data Services (2005) Performance Management, IDS Studies, No. 796, April.
Industrial Relations Services (1999) ‘New ways to perform appraisals’, IRS Employment Review,
No. 676, March, 7–16.
Industrial Relations Services (2005a) ‘Appraisals (1): not living up to expectations’, IRS Employment Review,
No. 828, 29 July, 9–15.
Industrial Relations Services (2005b) ‘Appraisals (2): learning from practice and experience’, IRS
Employment Review, No. 829, 12 August, 13–17.
Labour Research Department (1997) Performance Appraisal, LRD.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
McGregor, D. (1957) ‘An uneasy look at performance appraisal’, Harvard Business Review, 35(3), 89–94.
McKenna, E. and Beech, N. (2002) Human Resource Management: A Concise Analysis, Pearson Education
Limited.
Redman, T. (2006) ‘Performance appraisal’, in T. Redman and A. Wilkinson (eds.) Contemporary Human
Resource Management: Texts and Cases, Prentice Hall, 2nd edition, 153–187.
Torrington, D., Hall, L. and Taylor, S. (2005) Human Resource Management, Prentice-Hall, 6th edition.
Umbreit, T., Eder, R. and McConnell, J. (1986) ‘Performance appraisals: making them fair and making them
work’, Cornell Hotel and Restaurant Administration Quarterly, 26, 4, 59–69.
Woods, R., Sciarini, M. and Breiter, D. (1998) ‘Performance appraisal in hotels’, Cornell Hotel and
Restaurant Administration Quarterly, 39(2), 25–29.
Websites
Workforce Management has a description of a 360-degree appraisal process in Yum Brands Inc (Workforce
Management, April 2005, pp. 59–60). This article can be found at http://www.workforce.com/index.html
at the main site use the free registration facility then find the article via the search facility.
The CIPD Performance Management survey can be found at http://www. cipd.co.uk/surveys
There are a number of helpful tips and tools to improve appraisal at http://www.businessballs.com/perfor-
manceappraisals.htm
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Chapter 9
Reward strategies in
the tourism and
hospitality industry
Chapter objectives
This chapter considers reward strategies in the
tourism and hospitality industry. Specifically this
chapter will:
? Review differing employer and employee
objectives with regard to pay.
? Consider debates about minimum and
maximum wages and comparability of pay
across tourism and hospitality sub-sectors and
occupations.
? Recognize the importance of tipping as part of
the reward package in tourism and hospitality.
? Discuss the variety of additional non-monetary
rewards available to tourism and hospitality
employers.
188
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Introduction
The first problem we face when thinking about the notion of reward strategies is a ter-
minological one. When we talk about rewards we are likely to hear a variety of terms.
For example, Foot and Hook (2005) note a number of commonly used terms used to
describe payment systems, including ‘compensation’, ‘remuneration’, ‘reward’, ‘pay-
ment’, ‘wages’ and ‘salaries’. Increasingly in a prescriptive HRM sense there is much
talk of ‘total remuneration planning’, ‘reward management’ or ‘reward strategy’ as
denoting a more strategic and holistic approach to the rewarding of employees.
Therefore in this more prescriptive view it is argued that employees seek a range of
monetary and non-monetary rewards – the so-called ‘cafeteria approach’ – from
employment of which money is only one aspect, even if it is often the primary con-
sideration for employees. Thus, employees may seek both extrinsic and intrinsic and
financial and non-financial rewards at work. That said, a more realistic assessment is
that in reality the provision of extrinsic rewards is certainly the most substantive issue
in the effort–reward bargain and often the most problematic aspect of employment.
Therefore this chapter will focus on the notion of extrinsic rewards and in particular
pay as it will often be the main reason why people work. In considering pay and
other aspects of remuneration, this chapter will also recognize how the nature of
tourism and hospitality as an employing sector will significantly impact on the devel-
opment of reward strategies. For example, the existence of a relatively large number
of unskilled and semi-skilled employees means low pay is endemic in many parts of
the tourism and hospitality sector, particularly the sub-sector of hotel and catering.
Employee and employer views of pay
Torrington et al. (2005) recognize how, ‘the contract for payment will be satisfac-
tory in so far as it meets the objectives of the parties’ (p. 569). In recognizing this
point we can now consider how these objectives are likely to differ depending on
whether it is employees or employers.
Employee objectives for the contract for payment
Purchasing power
The absolute level of weekly or monthly earnings will determine the standard of
living of individual employees, so they will aim to maximize their purchasing
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power. In simple terms, employees will ask themselves how much they can buy
with their earnings. Torrington et al. suggest that employees will rarely be truly
satisfied about their purchasing power. Indeed, it could be argued that purchasing
power has become ever more resonant in an era of conspicuous consumption in
which marketing and advertizing portray a wide array of goods or services which
people should be aspiring to consume.
Felt to be fair
In many respects the notion of felt to be fair is captured in the idiom of ‘a fair’s day
pay for a fair day’s work’. In this sense employees tend to have a strong sense of
what they feel is an appropriate level of payment which is fair to the job they are
doing. As Torrington et al. note the employees who feel underpaid are likely to
withdraw from the job and are more likely to be absent or late, for example. This
situation can be exacerbated if an employee has no real choice in terms of poten-
tially moving elsewhere. Of course employees may not simply feel underpaid,
there may be some instances were employees actually feel they are overpaid.
In such instances employees may feel guilty or attempt to look busy, which from
an organizational point of view may not necessarily be particularly productive.
Rights
Here Torrington et al. recognize the fundamental issue of the rights of employees
to a particular share of a company’s profit or the nation’s wealth. Clearly, the man-
ner in which wealth is currently shared out is one which engenders much debate
and many employees might feel that they are not getting a reasonable or fair share
of the wealth that is created. This general sense of unease will often be expressed
by trade unions in particular, who will seek to create a more fair division of wealth
based often on notions of social and economic justice.
Relativities
Torrington et al. note that a question often asked by employees is ‘how much do I
(or we) get relative to … group X?’ (p. 597). In that sense the notion of relativities
is similar to the issues considered in the discussion of felt to be fair. Here though
the employee will not ask whether remuneration is fair to the job done, but instead
whether it is reasonable compared to jobs done by other people. Comparison may
take place at a number of levels from the immediacy of the person sitting at the
next desk to other companies or other professional or occupational groups. Much
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of this comparison may not be based on an entirely objective view. For example, in
comparing one job with another there may be significantly more responsibility in
a job that perhaps shares a similar title or job description.
Notions of felt fair, rights and relativities are particularly important and will
often lie at the heart of much of the debate and controversy which is generated about
pay and especially whether people are being ‘fairly’ paid (see HRM in practice 9.1).
Recognition
Torrington et al. note how most employees want to see their personal contribution
recognized either to be reassured of their worth or to facilitate career progression.
Part of this recognition may well be financial recognition, though in reality there
may be other aspects as well as the financial in recognizing and improving
performance.
Composition
Composition refers to the issue of how a pay package is made up and how this may
vary between individual employees, depending on things like age or sex. For
example, younger employees may be much more concerned with high direct earn-
ings at the expense of indirect benefits such as pensions, which are likely to be of
more interest to older employees. Other issues surrounding the composition of pay
packages include aspects such as overtime and incentive or performance-related pay.
Employer objectives for the contract of payment
Prestige
As Torrington et al. note, ‘there is a comfortable and understandable conviction
among managers that it is “a good thing” to be a good payer’ (p. 598). Clearly part
of the reason for being a good payer is to attract the best labour which is available
to an organization. Torrington et al. warn that being a good payer does not
axiomatically bestow a reputation as a good employer. That said, they also suggest
Review and reflect
Are the chief executives described in HRM in practice 9.1 ‘greedy bastards’, as John
Edmonds suggests, or fairly remunerated?
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HRM in practice 9.1 The disparities between
those who have and those who do not have
in tourism and hospitality
Much of the debate about disparities in pay focuses on notions of fairness and equity and
the difference between those at the top and bottom of the earnings ladder. Indeed, the
issue of pay inequality has often been at the forefront of trade union campaigns to increase
wages for those lower down the organizational hierarchy. For example, John Edmonds,
then general secretary of the GMB union, once famously railed against private sector
bosses who awarded themselves inflated pay increases describing them as ‘greedy bas-
tards’ (Milne and White, 1998) who were indulging in the ‘politics of the pig trough’
(Milne, 1998). Certainly this debate has some resonance for tourism and hospitality and
over the years there has been plenty of evidence to suggest that there is a significant pay
gap between those who have and those who do not have in tourism and hospitality.
Travel and Leisure Industry Salary Survey 1997 found that the highest paid directors
at the UK’s top 12 tourism and hospitality companies earned an average of £478 500,
compared to a staff average of £11 360. Some of the so-called ‘fat cats’ were:
Peter George – Ladbroke chief executive £1 280 000
Gerry Robinson – Granada chairman £728000 (though in December 1999 by cashing
in share options he made a pre-tax profit of £5.26 million)
Sir Ian Prosser – Bass chairman £678 000
Caterer and Hotelkeeper (23 December 1999) reported that chief executives in the
hospitality industry received an average pay increase of 20.8 per cent, compared to
3.5 per cent for employees.
Caterer and Hotelkeeper (18 May 2000) reported how David Thomas, Chief
Executive of Whitbread, saw his total salary raised by 25.8 per cent, while group profits
dropped by 14.8 per cent. His overall earnings were £593 103. The same article also
reports how the average basic salary of 20 selected chief executives in the hospitality and
leisure sectors was £330 835, which with bonuses and benefits rose to £370 293.
Leisure and Hospitality Business (25 July 2002) reported the highest paid chief execu-
tives packages for 2001/2002. The highest earner was Tom Oliver, Director of Six Continents
Hotels and Resorts, who had a basic salary of £527000, bonuses of £533000 and benefits
of £207000, giving him an overall package of £1267000. The lowest paid director was Paul
Dermody of the De Vere Group. His basic salary was £231000, his bonus was £50000 and
his benefits £13000, giving him a total salary of £294000.
IRS Employment Review (19 May 2006) report a survey of salaries in the leisure indus-
try. Amongst other things it notes that the average employee in the industry earns £18602
a year, just 4.4 per cent of the average £501613 paid to chief executives.
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that being seen as a low-paying employer will mean an organization has a reputa-
tion as being a poor employer.
Competition
Here a key issue is the need to pay rates that are sufficiently competitive to sustain
the employment of the right number of appropriately qualified and skilled
employees for the organization’s needs. Unlike prestige the key aspect in consider-
ing competition is the need for a good fit to ensure for example that employers are
not over paying employees.
Clearly an important part of prestige and competition is the manner in which
the organization is interacting with the external labour market and ensuring
that they are getting the right kind of labour at the right kind of price (see HRM
in practice 9.2 and 9.3).
Control
Torrington et al. note the manner in which organizations have to consider control-
ling pay and particularly the extent to which money may be saved, though
changes with regard to legislation in areas such as redundancy mean that such
measures are less apparent in organizations.
Motivation and performance
At one level there is a simple issue facing organizations in terms of their ability to
use payment to motivate employees to perform well. In reality though there may be
a number of means to achieve this. For example, the use of performance-related pay.
HRM in practice 9.2 The NMW in the
leisure industry
IDS (2004) note that in the past many companies in the leisure sector have preferred to
keep their rates well ahead of the NMW. However, more recently the level at which the
NMW has been uprated has meant that some leisure employers have found it more diffi-
cult to be a higher paying employer. In the past by paying above the NMW some leisure
employers were seen as ‘good’ employers, especially given the large number of unskilled
jobs in the sector. As one company is quoted as saying, ‘Now when we are asked what we
pay, we have to say “minimum wage” which puts a real stigma on both the job and the
staff who do these jobs’.
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Cost
Torrington et al. note how just as employees are concerned with their purchasing
power, so employers are interested in the absolute cost of payment. In particular,
organizations will be concerned of the impact on labour costs on profitability or
cost effectiveness. This issue has a particular resonance in tourism and hospitality
due to its labour intensive nature, meaning that the proportion of labour costs is
higher than most other industries.
Change management
Pay may be used as part of a broader change management process. For example,
there may be additional bonuses available for employees willing to develop new
HRM in practice 9.3 Challenging perceptions
of ‘McJob’
McDonald’s has often been at the forefront of arguments that suggest that work in tourism
and hospitality is inherently low paid and with little meaning. For example, Douglas
Coupland, the author of Generation X: Tales for an Accelerated Generation, coined the
term McJob to describe a low-paying, low-prestige, low-dignity, low-benefit job, no-future
job in the service sector. Recently the company has sought to address these issues head-on
with a sustained campaign to change perceptions about the McJob descriptor. A key part
of this re-branding has been attempts to draw attention to fairness with regard to career
opportunities and remuneration. For example, the company has suggested that the pro-
portion of employees who regard their pay as ‘fair’ is 30 per cent higher than comparable
companies. Part of the reason for this finding may be the manner in which McDonald’s pay
well above the lowest rate of the NMW for 16–17-year olds. The company has a lowest
rate of £4 per hour for this group of employees, a full pound above the state’s 16–17-year-
old development rate. Of course, McDonald’s have a relatively large number of employees
who will be in the 16–17 age bracket and so arguably could be seen to be a ‘good’
employer to that particular segment of the labour market. Interestingly this is in contrast to
the rate for 18–21-year olds and those aged 22 years, where the lowest rate is at the level
of the NMW, although with increments staff can eventually earn a top hourly rate of £8.70.
Derived from Anon (2006); Overell (2006).
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behaviour, attitudes or skills, which are required as part of a cultural change
process.
In sum, employers will be seeking an approach to reward management which
is likely to have several principal objectives, including:
? Attract and retain suitable employees.
? Maintain or improve levels of employee performance.
? Comply with employment legislation.
Clearly, the approach that an organization develops towards reward strategies
does not exist in isolation and there will be a number of other influences on pay
determination that will affect such considerations, including:
? Beliefs about the worth of the job – for example, the size, responsibility, skill require-
ments and ‘objectionableness’ of duties.
? Individual characteristics –- for example, age, experience, seniority, general quali-
fications, special skills, contribution, performance and potential.
? Labour market – the level and composition of any given reward package will be
influenced by labour supply and demand at either national or local labour mar-
ket level, and whether an organization is seeking to create a strong internal
labour market.
? Strength of bargaining groups – for example, the potential for trade unions to
influence pay determination. At any given time the relative strength of trade
unions will be influenced by other external economic factors, such as the level
of unemployment and feelings of job security.
? Government intervention and regulatory pressures – for example public sector pol-
icy and other policy initiatives. Most obviously, the statutory national min-
imum wage (NMW), but also in terms of public policy towards aspects such as
trade unions and collective bargaining.
There are a wide range of things then which can conceivably influence and shape
the rewards that employees may get and the ‘market rate’ for a particular sector or
occupation. Let us now begin to develop this framework within the context of
tourism and hospitality.
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Remuneration in tourism and hospitality
Generally when we are talking about remuneration in the tourism and hospitality
industry, we can start with the fairly negative observation that relative to other
industries the majority of jobs and occupations within the sector are poorly remu-
nerated (Lucas, 2004; Baum, 2006). When we recognize that often there is low sta-
tus ascribed to the industry the perception held by a number of people is that for
many tourism and hospitality is an employer of last resort, with mundane,
degrading employment. The prevalence of low pay and perceptions about low sta-
tus can be seen as being two key issues which continue to sustain the negative
view held by many of tourism and hospitality work (Lindsay and McQuaid, 2004).
To begin to examine remuneration in tourism and hospitality in detail we should
begin by recognizing the work of Mars and Mitchell (1976) and their notion of the
‘total rewards system’. The ‘total rewards system’ has several aspects, which are:
basic pay and subsidized food and lodging, which can be considered as the ‘for-
malized’ aspect of the wage–effort bargain; and other aspects which can be con-
sidered as more informal rewards, these being tips, which are semi-formalized,
and ‘fiddles and knock offs’, which are non-formalized. In reality, it is apparent
that the notion of a ‘total rewards system’ is in fact a misnomer and there are a
variety of other aspects in terms of a range of benefits that may be used by tourism
and hospitality organizations to make up a reward package, a point which we will
further consider later in this chapter. Nevertheless, at least initially the notion of
the total rewards system provides a useful starting point to consider some funda-
mental issues and concerns in understanding reward practices in the tourism and
hospitality industry, particularly with regard to basic pay and tipping.
Basic or base pay
In a general sense Torrington et al. (2005) note that there are a number of
approaches to the setting of base pay rates. Here, of course as we noted earlier in
this chapter managerial actions may be constrained by the manner in which the
state influences pay determination, most obviously with the provision of min-
imum wage legislation. In addition to this aspect though Torrington et al. also note
the importance of external market comparisons and for example whether employ-
ers will pay at or above ‘the going rate’ for a particular job. There are also internal
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labour market mechanisms in which the skills and experience of employees will
have a bearing on their pay. Afurther mechanism to determine pay is job evaluation,
which is a systematic attempt to aid the establishment of differentials across jobs
within a single employer. As a consequence the organization’s wage budget is
divided among employees on the basis of assessing the nature and size of the job
they do. The last mechanism identified by Torrington et al. is that of collective bar-
gaining, where pay rates are determined through collective negotiations with trade
unions or other employee representatives. As will be discussed in the following
chapter though, trade union representation has always been very low in the tourism
and hospitality sector and collective bargaining has tended to play little influence in
pay determination in the sector. Instead, determination of pay in tourism and hospi-
tality has traditionally been a matter of managerial prerogative (Lucas, 2004).
In considering pay in tourism and hospitality the first point which is worth
noting is the enduring and prevailing existence of low pay in the sector. For example,
Wood (1997a: 69) notes how, ‘the majority of academic evidence concurs in sug-
gesting both that basic rates of pay in hotels and catering are inadequate and
employers are frequently ruthless in pursuing low-pay strategies’. Thus tourism
and hospitality, and particularly the hotel and catering sub-sector, is low paid,
both in absolute terms (i.e. purchasing power) and relative terms (compared to
most other workers) (see also HRM in practice 9.4).
Whilst the hotel and catering sub-sector is clearly low paid, the picture in
other areas of the tourism sector may be more mixed. On the one hand, Baum
(2006) notes how other sub-sectors such as travel agencies, airlines and tour oper-
ators, who are often staffed by young and female employees, also offer relatively
poor remuneration. Often this will mean that for a number of front-line positions,
such as travel advisors, the pay rate will be at or near the NMW. For example,
MyTravel, a major provider of package holidays and other leisure travel services,
offers a salary range for a travel advisor of £9000–£11500 (http://www.mytravel-
careers.co.uk/retail/accessed 15 May 2006). On the other hand, a recent survey
conducted by Croner in conjunction with the Association of British Travel Agents
(ABTA) suggests that the median basic salary for workers in the travel industry
was £21753, which rose to £23135 when other aspects such as commission and
bonuses were added (IRS, 2006b). These figures are clearly significantly higher
than the figures for the hotel and catering industry noted in HRM in practice 9.4.
Moreover, whilst relatively low pay may be true for a number of front-line posi-
tions in tourism and hospitality it is a different picture for other occupational
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groups. For example, IRS (2006c) note that in First Choice Airways’ a first officer
can expect to start work with the company at a basic salary of £31011, with a cap-
tain’s salary ranging from £67576 to £94113. Generally though, as with the hospital-
ity sub-sector, the bulk of employees within tourism-related occupations are likely
to be relatively low paid (Baum, 2006). To an extent though Baum also recognizes
that within a number of tourism jobs aspects such as travel opportunities, uniforms
HRM in practice 9.4 Condemned to low pay?
A history of low pay in the hospitality
industry
1975 – The Hotel and Catering Economic Committee suggested on the basis of low pay
of 60 pence an hour for men and 55 pence an hour for women, 49 per cent of full-time
men and 88 per cent of full-time women in hotels and catering were low paid, compared
to 11 per cent and 53 per cent in ‘all industries’ across the economy.
1986 – Byrne estimated that between 57 and 64 per cent of full-time workers in hotel
and catering employment were low paid (i.e. defined as earning less than two-thirds of
male median earnings).
1989 – A British Hotels, Restaurants and Caterers Association survey revealed catering
managers earned 27 per cent less than average non-manual workers and non-manual
employees earned 28 per cent less than the average for manual workers.
1999 – The Office of National Statistics New Earnings Survey 1999 found that waiters/
waitresses (average gross annual salary £8879), along with kitchen porters and kitchen
hands (average weekly wage £180.50) were the lowest paid of all UK employees (the
average yearly pay across all occupations was £20 919).
2003 – The Office of National Statistics New Earnings Survey 2003 found that hotel and
restaurant employees were the lowest paid in the country. Average gross annual pay for
full time restaurant and hotel employees was just £16 533, compared to a UK average of
£25 170.
2005 – The Office of National Statistics Annual Survey of Hours and Earnings 2005 found
that hotels and restaurants had the lowest median gross annual earnings at £14 653. The
highest paying sector was financial intermediation at £29 962. The median for all indus-
tries and services was £22 903.
Derived from Wood (1997a); Bozec (1999); Anon (2003); IRS (2006a).
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and a generally pleasant working environment may encourage something of a
trade-off between a desire for higher levels of pay and less acceptable conditions
or other benefits (see HRM in practice 9.5).
Wage regulation in tourism and hospitality
Although we noted above that pay determination has largely been dictated by the
managerial prerogative in more recent times the introduction of the NMW has intro-
duced greater regulation by statutory means. The NMW marks a significant change
in the British employment landscape and will be discussed in due course. To place
the emergence of the NMW in context though it is worth briefly mentioning wages
councils, which had previously played a role in setting a de-facto minimum wage.
For a large number of those working in tourism and hospitality, and particularly
hotel and catering, the wages councils provided a minimum safety net with regard
to wages for nearly 50 years. First introduced in 1909 as trade boards, and first cov-
ering the hospitality sector from the mid-1940s, wages councils peaked in the 1950s
covering over 3.5 million workers, providing surrogate collective bargaining for the
low paid (Metcalfe, 1999). At the time of their abolition in 1993 there were three
wages councils that covered different sub-sectors of the commercial hospitality
industry and the mean hourly rate they set was £2.97 per hour which was £115.96 for
a 39-hour week or £6029.92 per annum (Goldsmith et al., 1997). From 1993 to the
introduction of the NMW in 1999 there was no real protection for employees and
evidence suggests that a number of employers took advantage of this omission in an
attempt to drive down wages (Lucas and Radiven, 1998; Lucas, 2004).
HRM in practice 9.5 Work as leisure
Guerrier and Adib (2004) conducted research by interviewing and observing 14 overseas
tour reps in Mallorca. They found that for this group of employees there will often be a
blurring between work and leisure, which may allow the worker to enjoy some of the
benefits of leisure at work. As an example overseas tour reps may not distinguish
between their work and non-work lives. Customers may be their friends, their workplace
is where they would ‘hang out’ anyway and their work does not demand a subordination
of self but only a presentation of their authentic, fun loving and sociable self.
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The NMW now seems a well established aspect of the employment landscape
but prior to its introduction there was vociferous debate about whether it should
even be introduced. For example, the British Hospitality Association (BHA) was
implacably opposed to the NMW. Much of the debate was centred on whether the
argument was best understood from a moral or economic point of view (see Wood,
1997b for an overview of the debate). For example, in the interests of social justice
proponents of the NMW suggested that all employees should be ‘decently’ paid.
On the other hand, opponents pointed to the likely rise in unemployment created
by rising payroll costs stemming from the NMW. It was in this context that the
NMW was introduced by the Labour Government. Once the minimum wage was
accepted as a key policy plank of New Labour’s notion of ‘fairness at work’, the
main issues became practical ones, such as the level the wage was set at and the
way it was implemented and enforced. To a large extent these issues were deter-
mined by the Low Pay Commission (LPC), which was established in July 1997 as
a statutory body and has continued to play a key role even after the enactment of
the minimum wage legislation. The LPC consists of nine members who represent
the interests of employers, unions and employees, and ‘objective’ independent
expert academics (Thornley and Coffey, 1999). Indeed, the LPC was able to largely
agree on the terms of the implementation of the NMW and is suggested as provid-
ing an exemplar of a positive social partnership between employers and employees
in particular (Metcalfe, 1999; though see Thornley and Coffey 1999 for a more
critical account).
The LPC reported in 1998 with the National Minimum Wage Act coming into
being in the same year and the NMW actually starting on 1 April 1999. There was
much discussion and horse trading in relation to issues such as the level of the
NMW and whether things like tips would be included. For example, with regard
to the rate the Confederation of British Industry suggested £3.20, the Trades Union
Congress had suggested £4.00 and many trade unions and pressure groups, such
as the Low Pay Unit (LPU), using the formula of applying half male median earn-
ings to the New Earnings Survey, suggested £4.61. George Bain, then chair of the
LPC, had gone on record to suggest that £3.75 was not outrageous (Barnett, 1997)
and it was calculated that if Wages Councils had still been in existence the rate in
April 1999 would have been £3.90 (Metcalfe, 1999). Ultimately though the main
rate was set by the LPC at £3.60 (see HRM in practice 9.6).
The reaction to the NMW was mixed. On the one hand employers views were
generally favourable about what they felt was an acceptable rate. For example, the
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BHA applauded what they considered to be a ‘realistic’ wage, supported the
‘sensible’ level for 18–21-year olds, but expressed regret that there were no
regional variations (Clavey, 1998). There were also some concerns from some
tourism employers that the accommodation offset would count towards payment
of the NMW but only at the rate of £20 per week (Fox, 1998; at the time of writing
this offset now stands at £27.30).
On the other hand, trade unions and the LPU were less sanguine at what they
felt to be an overly prudent and overcautious rate. As Bill Morris, then General
Secretary of the Transport and General Workers Union, pithily put it, ‘Thank you
for the principle, shame about the rate’ (cited in Metcalfe, 1999: 193). Similarly,
Rodney Bickerstaffe, then General Secretary of Unison, applauded the implemen-
tation of the NMW whilst also suggesting that, ‘£3.60 for an hour of anyone’s life
at the end of the 20th century in one of the richest countries on earth is not some-
thing to be proud of’ (cited in Clavey, 1998: 10; and see HRM in practice 9.7).
HRM in practice 9.6 The LPC: Shaping the
NMW in tourism and hospitality
Main recommendations:
? NMW to be £3.60 with an upgraded rate of £3.70 in June 2000.
? Development rate for 18–21-year olds £3.20 per hour rising to £3.30 by June 2000.
? NMW not expected to be subject to regular annual revision and not index-linked in
any fashion.
? 16–17-year olds exempt.
The Government response:
? Acceptance of the £3.60 figure, which came into force on 1 April 1999.
? Development rate to be £3.00 per hour.
? No guarantees that the upgraded rate would apply to either the development or full
rate in June 2000.
? Exemption of young workers.
? Tips and service charges distributed centrally via payroll to count against NMW, but
cash tips paid by customers directly to staff not included.
? A maximum figure of £20 to be deducted for the cost of employees’ accommodation.
Derived from Walsh (1998); Metcalfe (1999).
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Despite the disappointment on the part of trade unions and other lobbying
bodies at the rate at which the NMW was set, approximately two million workers
did receive a wage increase as a result of the legislation, with many of these work-
ers being women, part-timers, youths, non-whites and single parents (Metcalfe,
1999). Of course many of these workers were to be found in tourism and hospital-
ity with the LPC estimating that around 800000, or 42 per cent, being in the retail
and hospitality sectors (LRD, 1998).
Although the tourism and hospitality industry was disproportionately
affected in terms of the number of employees who benefited from the NMW, due
to its low rate it has been suggested that in reality there has been ‘minimum
impact’ and ‘much ado about nothing’, even in smaller businesses (Rowson, 2000;
Turnbull, 2000; Adam-Smith et al., 2003). Indeed, a survey undertaken of low-
paying sectors by Income Data Services (IDS) prior to the introduction of the
NMW found that a number of larger tourism and hospitality companies, such as
Centre Parcs and Marriott, where already paying at, or over the rate at the point of
implementation (IDS, 1999, though see also HRM in practice 9.8).
Employer concerns about issues such as loss of competitiveness and job losses
have also proved to be wide of the mark (LRD, 2001). For example, Lucas (2004)
notes how employment has increased in the hospitality sub-sector by over 200000
since 1999.
As was noted earlier in this chapter the LPC having initially recommended the
rate for the NMW has had the responsibility of reviewing its operation and in the
HRM in practice 9.7 A ‘Living Wage’?
The GLA (2006) note that since the inception of the NMW, at what many trade unions felt
to be an unnecessarily low level, there has been much discussion of what is an ‘acceptable’
level for the NMW. More recently, a campaign has emerged in support of a ‘living wage’.
Originating in America, the living wage campaign aims to address what it considers to be
‘poverty wages’. Currently it is suggested that the ‘living wage’ for London should be £7.05
(similar campaigns have been started in other parts of the UK) and campaigners are seek-
ing to target industries such as tourism and hospitality to ensure that companies are pay-
ing this wage. With mayoral support in London and a commitment from the London 2012
Olympic project team to the living wage, the campaign has enjoyed some success in
raising the issue of low pay.
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period from 1999 has recommended regular annual uprating, though this has
reflected prevailing economic circumstances rather than any particular uprating
formula. Interestingly though in the period 2002–2006 the adult minimum wage
has increased by 27.4 per cent, while average earnings increased by just 17 per cent
(LPC, 2006). Though in its most recent report the LPC does acknowledge that the
phase in which they are committed to increasing the NMW above average earn-
ings is now complete and in future will have no presumptions that increases above
average earnings are required. Importantly, the LPC also recommended that
16–17-year olds be brought under the umbrella of the NMW from October 2004
(see Table 9.1). Bringing 16–17-year olds under the aegis of the NMW again dis-
proportionately impacted on tourism and related industries with retail and hospi-
tality respectively accounting for 45 per cent and 21 per cent of the overall total
brought under minimum wage protection (LPC, 2006).
Although the NMW is a relatively recent phenomenon in the UK nearly all
OECD countries have minimum wage setting arrangements (Metcalfe, 1999).
Anumber of Scandinavian countries and countries such as Germany and Italy rely
on collective bargaining mechanisms to set minimum wages, ordinarily at a
sectoral level. In a large number of countries though there are statutory require-
ments and it is interesting to compare the UK with a number of other countries
(see Table 9.2).
HRM in practice 9.8 Pizza Hut and Pizza
Express: Taking away from their
employees
Pizza giants, Pizza Hut and Pizza Express, found themselves at the centre of controversy
when the NMW was implemented. Both companies responded to the implementation of
the NMW by seeking to reign in costs. Pizza Hut removed paid taxi fairs home for their
staff, claiming that they could no longer afford this benefit with the introduction of the
NMW. Pizza Express initially retained a basic rate of pay of £3.10, with the expectation
that tips would make up the shortfall, despite the law saying that tips could only be
included if they were paid through the bill. As a result of this decision the company was
ultimately forced to pay out £250 000 in back pay to waiting staff.
Derived from Anon (1999a, b).
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In addition to basic pay there are a number of other aspects which can be con-
sidered in reviewing payment issues in tourism and hospitality. IDS (2005a, b) in
their annual review of hotels, pubs and restaurants note a number of additional
areas where employees could enhance basic pay. Just over half of the 20 hotels they
surveyed offered a premium for night work. This payment could either be a flat
rate, for example night porters in one hotel could earn £1800 more than day porters.
Alternatively some of the surveyed hotels paid a premium for those hours worked
at night with IDS citing the example of food and beverage staff receiving an add-
itional 30 pence an hour for every hour worked past midnight. With regard to the
broader issue of bonus and incentive schemes, all but two of the surveyed hotels
offered a bonus or incentive scheme. Many of these schemes attempt to incentivize
front-line staff to offer good quality service in showing appropriate behaviours and
attitudes and may use some of the customer appraisal techniques discussed in the
previous chapter, such as mystery guests. In over half of the schemes payments are
related to sales, with profit- and performance-related payments being the next most
Review and reflect
In considering debates about the NMW and the pay disparities outlined in HRM in
practice 9.1, is there an argument for a maximum wage?
Table 9.1 How the UK NMW has evolved since 1999
Adult rate Development rate 16–17-year olds rate
(for workers aged 22?) (for workers aged 18–21)
1 April 1999 £3.60 1 April 1999 £3.00 – –
1 October 2000 £3.70 1 October 2000 £3.20 – –
1 October 2001 £4.10 1 October 2001 £3.50 – –
1 October 2002 £4.20 1 October 2002 £3.60 – –
1 October 2003 £4.50 1 October 2003 £3.80 – –
1 October 2004 £4.85 1 October 2004 £4.10 1 October 2004 £3.00
1 October 2005 £5.05 1 October 2005 £4.25 1 October 2005 £3.00
1 October 2006 £5.35 1 October 2006 £4.45 1 October 2006 £3.30
Source: http://www.lowpay.gov.uk/ Reproduced with permission from the LPC.
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common measure. The criteria differed across the hotels. IDS cite the example of
Hilton where heads of division receive a bonus based on profit, service and people
management, whereas staff received a bonus based on sales. In one of the surveyed
hotels food and beverage staff received a bonus based on service charge. Only one
of the surveyed hotels had a share option scheme and one also operated payments
for guest mentions. Afurther issue is that of pay progression and IDS note how a
number of the fast food companies that they surveyed linked pay to progression.
For example, McDonald’s links pay increases to performance appraisals, which are
based on four fixed levels, 0 per cent for ‘needs improvement’, 3 per cent for ‘good’,
4.5 per cent for ‘excellent’, 6 per cent for ‘outstanding’, with most employees receiv-
ing a 3 per cent rise. Pay progression may also be linked to the completion of
Table 9.2 Comparison of the level of the adult minimum wage across selected countries,
end 2004
Country (and year first In UK £
a
Age at which full Adult rate
introduced) rate usually applies as a percentage
of full-time
median earning
Australia (1996, some form 5.37 21 58.5/55.1
b
since 1907)
Belgium (1975) 4.92 21 48.5
Canada (women 1918–1930,
men 1930–1959) 3.66 16 39.5
France (1950, 1970 in current form) 5.20 18 56.6
Ireland (2000) 4.15 20 51.7
Japan (1959, 1968 in current form) 2.71 – 33.7
Netherlands (1968) 5.04 23 46.4 (50.1)
Portugal (1974) 1.99 16 38.0 (44.4)
Spain (1963, 1976 in current form) 2.34 16 30.0 (35.0)
United Kingdom (1999) 4.85 22 43.2
United States (1938) 3.37 20 32.2
a
Adjusted for purchasing power parities (August 2004).
b
Depends on the earnings survey used.
Figures in brackets include annual supplements.
Derived from Metcalfe (1999); LPC (2005).
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training in Prêt A Manger, where employees have to pass three assessments and
written tests to progress. Similarly, within the travel industry a recent survey of
salaries reported in IRS (2006b) found that bonus payments were common at all
levels of the industry. For example, half of the companies in the survey paid com-
mission to employees, based on their sales.
The practice of tipping
The notion of tipping is important in a number of ways, not least in its economic
importance. For example, Lynn (2003) suggests that consumers tip over $16 billion
a year in the US. Tipping may allow some tourism and hospitality workers to sig-
nificantly augment their income, though the potential impact with regards to
issues such as job satisfaction and emotional well-being equally need to be consider-
ed. Ogbonna and Harris (2002) also note the possibility of tipping being used as a
managerial mechanism to encourage individualization and subjugation of
employees. Tipping in this latter view becomes an important managerial tool for
the indirect control of employees in the employee–customer interaction, as well as
potentially suppressing interest in more collective power, for example through
trade union organization. Ogbonna and Harris (2002) note how employees in the
UK restaurant they studied resisted managerial attempts to resort to a system in
which tips would be kept by the company in return for a 10 per cent increase in
pay; in addition in the same case study management threatened to abolish tipping
if the employees became unionized.
It is important to note that tipping is very much culturally bound and as Ogbonna
and Harris (2002: 726) recognize, ‘although tipping is an internationally recogniz-
able behaviour, the actual practice is heavily influenced by societal cultural con-
siderations’. For example, tipping is widely practiced within the US, but is not as
widespread in the UK and elsewhere (see HRM in practice 9.9).
Review and reflect
What are likely to be some of the financial and emotional hazards for tourism and hos-
pitality employees who are reliant on tips to sustain a reasonable wage?
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Tipping is then largely driven by socio-cultural norms and/or individual con-
science. In relation to tourism and hospitality we should recognize that some
workers are in a position to enhance basic wages from tips, but this is only true for
those in tipped positions. Even for those in tipped positions it should also be
acknowledged that tips are notoriously unpredictable. Lynn (2001; and see also
Lynn, 2003) conducted a meta-analysis of a number of studies which had exam-
ined the relationship between restaurant tipping and service quality and found a
weak relationship. Consequently, for many front-line staff tipping may be more
influenced by external factors such as the race and gender of the customer, pre-
vailing weather conditions or even the result of football or rugby matches that are
played near the restaurant (Ogbonna and Harris, 2002).
The point is often made as well that tipping means losing sight of the fact that
the vast majority of people in tipping positions are generally in low-wage, low-
status occupations. Despite this point there is an argument, usually from employers,
HRM in practice 9.9 Tipping in different
countries
The US is generally recognized as having the most highly developed approach to tipping.
For example, it is not unusual for hotel guests to have to tip five people before they get
to their room. In the US for many tipped positions the general expectation is that cus-
tomer should tip at least 15 per cent. Tipping is less prevalent in other countries such as
Australia, New Zealand and Sweden. For example, in New Zealand tipping is not consid-
ered a normal cultural practice and moves to a US-type approach appear unlikely.
Managers and employees in New Zealand saw the institutionalization of tipping in the
US as distasteful and were particularly unanimous in their denunciation of the US prac-
tice of using tips to boost poor wages. It was felt that employers should fairly remuner-
ate employees and that this should not be left to customers. In many south-east Asian
countries it is not customary to tip and tipping can be a sensitive topic, especially if social
conventions are breached and people lose ‘face’. In contrast, research in France – where
tipping is unusual – found that if a waitress touched customers she got more and better
tips. This ‘touch effect’ is found in other countries, such as the US, but seems particularly
pronounced in France due to the tactile nature of social relations.
Derived from Callen and Tyson (2000); Casey (2001); Dewald (2001); Gueguen and
Jacob (2005).
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that tipping is a good motivator and that abolishing tips and paying higher wages is
not the answer, while alternatively others argue that tips are an unwelcome part of
the tourism and hospitality industry and a ‘fair’ fixed living wage would be more
desirable (Wood, 1997a). Critics of tipping would also argue that the practice weak-
ens social relationships as a number of interactions in tourism and hospitality
become overtly economic exchanges. It is also argued that tipping increases power
differences as in menial low-status jobs tipping reinforces and makes salient the infe-
rior status of workers. For example, Ogbonna and Harris (2002) found that a num-
ber of waiters and waitresses they interviewed felt that they were often abused
physically and mentally and had to accept subtle forms of sexual exploitation.
Engaging in sexualized flirting with customers may be part of a process that
degrades and debases front-line workers, often for comparatively little financial
reward (a point further considered in Chapter 11). There is also the final related
point that tipping tends to encourage a very individualistic view of the workplace
and does little to sustain a harmonious workplace relationships and that tipping
tends to weaken organizational commitment.
Clearly there is much debate about the efficacy and morality of tipping, though
given the reality of this practice still being prevalent in a number of tourism and hos-
pitality environments it is worthwhile briefly considering the underlying motives
for tipping and how servers may maximize their tips. With regard to motives under-
lying tipping Lynn et al. (1993) suggest the following:
? Desire for good service in the future.
? Desire for social approval.
? To compensate servers equitably for their work (i.e. reward their effort).
? Desire for status and power.
Furthermore, Lynn (1996 and 2003) reports on research which suggests a number
of ways in which servers’ are likely to increase their tips:
? Server introduction in a genuine and professional manner.
? Squatting next to table, though this is more likely to work in a casual dining envir-
onment, compared to fine-dining where it may be considered inappropriate.
? Smiling at customers.
? Touching customers.
? Credit card insignia on tip trays.
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? Writing ‘Thank You’ on checks.
? Drawing a ‘happy face’ on checks.
? Wearing a flower in hair and other means of personalizing the server’s appearance.
? Entertaining customers by for example telling a joke.
? Forecasting good weather.
? Calling customer by name.
Of course, there are several obvious caveats to the above discussion. First, the
research is based in the US and as we noted earlier in this chapter tipping is a cul-
turally bound phenomenon. Second, not all of these tip-enhancing techniques will
be appropriate for every type of restaurant or service setting, or indeed every
server. Consequently some of these aspects may work better than others and
should be used advisedly, both by individual employees and managers who
encourage servers to use such techniques.
Fiddles and knock-offs
Whilst basic pay, accommodation and tipping represent the more formalized aspects
of the reward package in tourism and hospitality it is also briefly worth considering
fiddles and knock-offs. Mars and Nicod (1984) found a large range of fiddles in their
work and note how ‘they are acts of dishonesty which the people involved do not con-
sider dishonest’ (p. 116). Fiddles generally involve pilferage from organizations, usu-
ally in a monetary sense. Knock-offs can also be considered a form of fiddle involving
the purloining of (usually) small items such as soap, linen and towels. Generally, these
practices are institutionalized within the organization and may be dependent on a
degree of management and supervisory collusion, although certain boundaries and
parameters will be set to delineate what is ‘acceptable’. Indeed, with regard to this
notion of acceptability organizations may tighten up on a ‘blind eye’ approach to fid-
dles and knock-offs when business slackens and the organization is looking to reduce
labour costs (Lucas, 2004). Afurther important point noted by Wood (1997a) concerns
the notion of individualism and the extent to which this is exacerbated by these prac-
tices. Thus, ‘Whatever arrangements exist for the allocation of fiddles and knock-offs
there are some grounds for believing that, as with tipping, these aspects of informal
rewards militate against the development of a collective workplace or occupational
ethic, fostering individualism and competitiveness’ (p. 88).
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 210
Other benefits
Although Mars and Mitchell characterized their model as a ‘Total Rewards
System’, many critiques have suggested that the use of total in this instance is
clearly a misnomer, and neglects a variety of other rewards which may be made
available by the organization. For example, in their survey of 20 hotel companies
IDS (2005b) found that three quarters provided free meals and staff discounts on
rooms, restaurants and shops within the hotel. Twenty per cent offered free use
of leisure facilities, including spas, beauty therapists, chiropodists and gyms.
HRM in practice 9.10 Total rewards fly in at
First Choice Airways’
First Choice Airways’ is a UK leisure airline and part of First Choice Holidays plc. The com-
pany employs over 14 000 staff, including nearly 400 pilots. The rigorous entry require-
ments and on-going training and competency testing at least twice a year are indicative
of the high level of responsibility associated with being a pilot. Resultantly the company
has recently reviewed the total reward package offered to pilots and as a consequence
developed a ‘Pilot Change Agenda’. A key part of the change agenda was to ensure the
pilots felt valued. Amongst other things this has led to the company to review the pay
and other rewards offered to pilots and to develop a new ‘total reward’ perspective.
Traditionally pilots already had a very good rewards package including: competitive base
pay; two final-salary pension schemes; a money purchase pension scheme; free medical
checks; private medical insurance; concessions of £1000 per year to spend on First
Choice holidays, and the option to buy further holidays on a tax efficient basis; free uni-
forms; duty and subsistence allowances; share plans; voluntary benefits, for example
childcare vouchers and other insurance and generous annual leave entitlement. Under
the new change agenda additional aspects of the total reward system include a new
bonus plan that links payments to adherence to corporate values and desired behaviour
or performance, a new share plan scheme, flexible working options and a new long serv-
ice award scheme. Of course, the nature of this package is very much driven by the
highly competitive environment in which the company is operating and the unique
nature of pilots as a group of employees in terms of their skills and qualities.
Source: IRS (2006c).
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REWARD STRATEGI ES I N THE TOURI SM AND HOSPI TALI TY I NDUSTRY 211
Around a sixth of hotels offered a pension scheme. Only one hotel provided life
assurance, dental, optical and private medical care. A minority of respondents
paid maternity pay above the statutory minimum, with 70 per cent paying sick
pay above the statutory minimum. Asimilar survey conducted in the travel indus-
try and reported in IRS (2006b) also noted a range of benefits. Over 70 per cent of
the 34 companies surveyed offered a company pension scheme, though only 11
per cent of companies offered a final salary pension scheme. Over half of the com-
panies offered private health insurance, with 39 per cent offering life insurance
and see HRM in practice 9.10.
Although HRM in practice 9.10, in particular, illustrates the possible range of
additional benefits that could be made available, in reality research suggests that
most tourism and hospitality workers are less likely to enjoy such benefits. For
example, Lucas (2004) cites figures from the Workplace Employee Relations Survey
which compares the tourism and hospitality industry with all private sector services
in terms of non-pay terms and conditions. With regard to employer pension scheme,
company car/allowance, private health insurance and sick pay in excess of statutory
requirements tourism and hospitality employers were significantly lagging behind
other employers in both private service sector and all industrial sectors.
Conclusion
We have examined a range of issues which cover rewards and payment which
demonstrate that arguably a fair and effective deal is still some way off for the bulk
of the tourism and hospitality workforce, and especially those in the hotel and
catering sub-sector. In an ideal world the effort–reward bargain would satisfy all
parties but the reality is different so for employers the strategy that is pursued
seems to coincide with the controlling operations and cost aspects of Torrington
et al.’s framework and for the employees there is little choice and no real sense of
aspiring to any of the loftier principles embodied in the Torrington et al. frame-
work. Furthermore prescriptive accounts of ‘total reward’ schemes that support
the notion of employees picking and choosing from a range of options to tailor a
pay and benefits package that meets their particular needs, need to be treated with
a good deal of caution in tourism and hospitality where the cafeteria approach
remains rare. Of course, as we acknowledged, there are exceptions to low pay both
sub-sectorally and occupationally, though for the majority of employees in
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tourism and hospitality notions of ‘fair’ remuneration remain somewhat elusive.
Indeed, this may seem rather paradoxical as often those entrusted with delivering
high-quality service may be the lowliest paid in the organization.
References and further reading
Adam-Smith, D., Norris, G. and Williams, S. (2003) ‘Continuity or change? The implications of the National
Minimum Wage for work and employment in the hospitality industry’, Work, Employment and Society,
17(1), 29–47.
Anon (1999a) ‘Restaurant chains make staff pay for the minimum wage’, Caterer and Hotelkeeper,
22 April, 4.
Anon (1999b) ‘Pizza Express hits out at MP’s slur on pay’, Caterer and Hotelkeeper, 15 July, 10.
Anon (2003) ‘Hospitality is lowest-paying industry’, Caterer and Hotelkeeper, 23 October, 6.
Anon (2006) ‘Is McJob still bad for you?’ Guardian Work, 10 June, 2.
Barnett, A. (1997) ‘No gain without Bain for the minimum wage’, Observer Business Section, 8 June, 16.
Baum, T. (2006) Human Resource Management for Tourism, Hospitality and Leisure: An International
Perspective, Thomson Learning.
Bozec, L. (1999) ‘Government report says hospitality is one of worst payers’, Caterer and Hotelkeeper,
28 October, 4.
Callen, R. and Tyson, K. (2000) ‘Tipping behaviour in hospitality embodying a comparative prolegomenon
of English and Italian customers’, Tourism and Hospitality Research, 2(3), 242–261.
Casey, B. (2001) ‘Tipping in New Zealand’s restaurants’, Cornell Hotel and Restaurant Administration
Quarterly, 42(1), 21–25.
Clavey, J. (1998) ‘Unions slam level of minimum wage’, Caterer and Hotelkeeper, 4 June, 10.
Dewald, B. (2001) ‘Restaurant tipping by tourists in Hong Kong’, Anatolia: An International Journal of
Tourism and Hospitality Research, 12(2), 139–151.
Foot, M. and Hook, C. (2005) Introducing Human Resource Management, Prentice Hall, 4th edition.
Fox, L. (1998) ‘ABTA shows concern over minimum wage’, Travel, Trade Gazette, 2 December, 6.
Goldsmith, A., Nickson, D., Sloan, D. and Wood, R. (1997) Human Resources Management for Hospitality
Services, International Thomson Business Press.
Greater London Authority (2006) A Fairer London: The Living Wage in London, GLA.
Gueguen, N. and Jacob, C. (2005) ‘The effect of touch in tipping: an evaluation in a French bar’,
International Journal of Hospitality Management, 24(2), 295–299.
Guerrier, Y. and Adib, A. (2004) ‘Gendered identities in the work of overseas tour reps’, Gender, Work and
Organizations, 11(3), 334–350.
Income Data Services (1999) ‘Implementing the National Minimum Wage’, IDS Report, No. 783,
April, 8–13.
Income Data Services (2004) ‘The impact of recent NMW increases in the UK leisure industry’, IDS Pay
Report, No. 906, June, 16–17.
Income Data Services (2005a) ‘Pay in hotels’, IDS Pay Report, No. 943, December, 11–15.
Income Data Services (2005b) ‘Pay in pubs and restaurants 2004/5’, IDS Pay Report, No. 931,
June, 11–15.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 212
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REWARD STRATEGI ES I N THE TOURI SM AND HOSPI TALI TY I NDUSTRY 213
Industrial Relations Services (2006a) ‘ASHE 2005: earnings growth fails to keep pace with inflation’, IRS
Employment Review, No. 840, 3 February, 31–35.
Industrial Relations Services (2006b) ‘£21 753 a year for travel industry employees’, IRS Employment
Review, No. 843, 24 March, 28.
Industrial Relations Services (2006c) ‘Smooth take-off for First Choice Airways’ new reward strategy’, IRS
Employment Review, No. 843, 24 March, 29–32.
Labour Research Department (1998) ‘Short changing young workers’, Labour Research, December, 11–13.
Labour Research Department (2001) ‘Is the minimum wage debate over?’ Labour Research,
May, 11–13.
Lindsay, C. and McQuaid, R.W. (2004) ‘Avoiding the “McJobs”: unemployed job seekers and attitudes to
service work’, Work, Employment and Society, 18:2, 297–319.
Low Pay Commission (2005) National Minimum Wage Low Pay Commission Report 2005, The Stationery
Office.
Low Pay Commission (2006) National Minimum Wage Low Pay Commission Report 2006, The Stationery
Office.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
Lucas, R. and Radiven, N. (1998) ‘After wages councils: minimum pay and practice’, Human Resource
Management Journal, 8(4), 5–19.
Lynn, M. (1996) ‘Seven ways to increase servers tips’, Cornell Hotel and Restaurant Administration
Quarterly, 37(3), 24–29.
Lynn, M. (2001) ‘Restaurant tipping and service quality’, Cornell Hotel and Restaurant Administration
Quarterly, 42(1), 14–20.
Lynn, M. (2003) ‘Tip levels and service: an update, extension, and reconciliation’, Cornell Hotel and
Restaurant Administration Quarterly, 44(5/6), 139–148.
Lynn, M., Zinkhan, G. and Harris, J. (1993) ‘Consumer tipping: a cross-country study’, Journal of Consumer
Research, 20, December, 478–488.
Mars, G. and Mitchell, P. (1976) Room for Reform? A Case Study of Industrial Relations in the Hotel
Industry, Open University Press.
Mars, G. and Nicod, M. (1984) The World of Waiters, George Allen and Unwin.
Metcalfe, D. (1999) ‘The British National Minimum Wage’, British Journal of Industrial Relations, 37(2),
171–201.
Milne, S. (1998) ‘Politics of the pig trough’, Guardian, 15 September, 10.
Milne, S. and White, M. (1998) ‘Read my lips “you greedy bastards”’, Guardian, 15 September, 7.
Ogbonna, E. and Harris, L. (2002) ‘Institutionalization of tipping as a source of managerial control’, British
Journal of Industrial Relations, 40(4), 725–752.
Overell, S. (2006) ‘Fast forward’, People Management, 9 February, 26–31.
Rowson, B. (2000) ‘Much ado about nothing: the impact on small hotels of the national minimum wage’,
The Hospitality Review, January, 15–17.
Thornley, C. and Coffey, D. (1999) ‘The Low Pay Commission in context’, Work, Employment and Society,
13(3), 525–538.
Torrington, D., Hall, L. and Taylor, S. (2005) Human Resource Management, 5th edition, Prentice Hall.
Turnbull, D. (2000) ‘Minimum impact’, The Hospitality Review, January12–14.
Walsh, J. (1998) ‘Pay commissioner denies fudge on development rate’, People Management, 25
June, 9.
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Wood, R. C. (1997a) Working in Hotels and Catering, International Thomson Press, 2nd edition.
Wood, R. C (1997b) ‘Rhetoric, reason and rationality: the national minimum wage debate and the UK hos-
pitality industry’, International Journal of Hospitality Management, 16(4), 329–344.
Websites
For an interesting discussion of the campaign towards a ‘living wage’, see http:// www.livingwage.org.uk/
The US version of the campaign also has a website at http://www.letjusticeroll.org/index.html
The Low Pay Commission has lots of useful material on their site at http:// www.lowpay.gov.uk/
There is lots of interesting material on tipping at http://www.tipping.org/index.shtml and http://www.
bbc.co.uk/dna/h2g2/alabaster/A640018
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Chapter 10
Employee relations,
involvement and
participation
Chapter objectives
This chapter considers the notions of employee
relations, employee involvement and employee
participation to review the extent to which
employees may influence managerial decision-
making. In particular, the chapter aims to:
? Recognize debates about employee/industrial
relations.
? Assess the differing ways in which conflict may
be conceptualized and resolved in the tourism
and hospitality workplace.
? Consider the role, or lack of it, for trade unions
in the tourism and hospitality industry.
? Appreciate how employee involvement and
employee participation mechanisms can be used
by tourism and hospitality organizations.
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 216
Introduction
The idea of some kind of employee influence in organizational decision-making is
one that seems to attract much support amongst all the parties who are involved
in the employment relationship; that is, employers, employees, trade unions and
the state. Indeed, as Blyton and Turnbull (2004) note recent years have seen
renewed interest in employee involvement and participation. This renewed inter-
est is partly explicable by the Labour Government’s attempts to promote ‘partner-
ship’ at work as well as the influence of the European social agenda, which has
encouraged greater employee participation through a number of European Union
(EU) Directives. However, although there may be universal support in principle
for the need for employee influence in decision-making, in reality there are likely
to be sharply differing views on the degree (the extent to which employees are able
to meaningfully influence managerial decisions), level (task, departmental, estab-
lishment or corporate), range (the range of subject matters likely to be discussed,
from what might be trivial issues such as food in the staff canteen to fundamental
strategic decisions) and form (either direct of indirect through representation) of
such influence (Marchington and Wilkinson, 2005).
Recognizing the above discussion Blyton and Turnbull (2004) suggest a con-
tinuum from no involvement through to employee control, although in reality
most organizations are likely to fit somewhere in between in the categories of
receiving information, joint consultation and joint decision-making, which in a
generic sense are likely to be characterized as being either employee involvement,
participation or industrial democracy. Underpinning much of this discussion is a
need to understand the nature of employee relations and the manner in which
many argue that this notion marks a major shift from a more collective view of the
employment relationship as embodied in the notion of industrial relations.
Initially then the chapter will consider this debate about how best to conceptualize
the contemporary employment landscape. Following this discussion we will then
move on and examine how these debates can be understand with regard to the
‘frames of reference’ (Fox, 1966) adopted by management in terms of dealing with
potential conflict in the workplace. Conflict can be considered at a number of
levels, one of which is the potential conflict of interests between trade unions and
employers. However, the tourism and hospitality industry is often suggested as
being one where trade unions have little or no influence. The veracity or otherwise
of this view will be discussed, including why tourism and hospitality employees
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EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON
may or may not join trade unions. Having considered one mechanism for articu-
lating an employee ‘voice’, that of trade unions, the chapter moves on to consider
a range of other mechanisms which seek to involve employees in the decision-
making process in organizations through the processes of employee involvement
and participation.
Employee or industrial relations?
In a recent analysis of the nature of employee relations in the UK economy CIPD
(2005: 5) suggest that, ‘the term “industrial relations” summons up today a set of
employment relationships that no longer widely exist, except in specific sectors, and
even there, in modified form’. In this view industrial relations can be thought of as
denoting formal arrangements between employers and trade unions, in which col-
lective bargaining would provide the mechanism for joint regulation that would
give trade unions a say in key management decisions. This view of industrial rela-
tions held by CIPD is by no means universally held and amongst others Sisson
(2005) responded with a wide-ranging rejoinder questioning whether the descrip-
tion of industrial relations as being anachronistic is indeed true. Whilst at one level
this debate about the nature of ‘industrial’ or ‘employee’ relations might seem like a
typical academic parlour game it is nevertheless important to recognize that at the
heart of this debate are a number of crucial concerns which are likely to significantly
influence arguments about the nature of employee involvement and participation.
To appreciate such debates it is worthwhile briefly considering how industrial and
employee relations may be considered different.
Industrial relations has its roots very much in the social sciences and draws on
a number of academic disciplines such as economics, law, sociology, psychology,
history and politics. The scope of industrial relations has traditionally encom-
passed the study of social institutions, legislative controls and social mechanisms
and the way they provided the framework for interactions between the key actors
in the employment relationship: government, employers and their organizations
and employees and their organizations. At the heart of industrial relations lies the
notion of how these partners manage the employment relationship, which denotes
an economic, social and political relationship for which employees provide man-
ual, mental, emotional and aesthetic labour in exchange for rewards allocated by
employers. Often debates about the employment relationship would centre on the
217
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 218
notion of the effort–reward bargain. As we saw in the previous chapter the
effort–reward bargain refers to the manner in which employees are rewarded for the
effort they expend on behalf of the organization. The potential conflict that would
arise in the allocation of effort from employees and reward from employers would
often be resolved through the use of, often adversarial, collective bargaining, where
trade unions and employers would come together to attempt seek a resolution based
on their relative strengths. Industrial relations, then, is often thought of as denoting
the formal arrangements to manage the employment relationship that existed in
large manufacturing plants where the world of work largely consisted of unionized
male manual workers who worked full-time (Blyton and Turnbull, 2004).
By contrast, employee relations emerged as a term in the 1980s in an attempt
to capture the changing nature of the employment landscape. In particular, as
CIPD (2005: 3) argues, ‘employee relations is now about managing in a more com-
plex, fast-moving environment: the political, trade union and legislative climates
are all shifting. In general, the agenda is no longer about trade unions’. Within this
view of employee relations then a key aspect of what is considered distinctive
about the term is a lack of trade union influence. In addition, employee relations
has also tended to be considered as denoting the changing nature of employment
in terms of the shift from manufacturing to service employment and the feminiza-
tion of the labour market. These shifts have had a significant impact on employ-
ment and work, for example the increasing number of employees who work
‘non-standard’ hours or the much greater involvement of the customer as a third
party in the employment relationship (Lucas, 2004).
As we acknowledged earlier there are many who would argue that these are
rather simplistic interpretations of the terms (Sisson, 2005). To an extent though the
above discussion does have an element of truth and at the least it is useful in denot-
ing key shifts in the nature of employment in recent years. In particular, the shift
from manufacturing to service employment and reliance on collective institutions
to a more individualized view of the employment relationship are clearly apparent.
Frames of reference and the resolution of conflict
Notwithstanding the debate about the terms industrial and employee relations a
key point that remains is the likelihood of conflict or competing interests existing
in the employment relationship. Of course, these aspects may also exist alongside
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more co-operative relationships and this notion of how employers view both con-
flict and co-operation can be further appreciated by drawing upon the unitary and
pluralist ‘frames of reference’ (Fox, 1966) through which the employment relation-
ship can be viewed.
Within the unitary frame of reference the metaphor of a football team is often
used to illustrate this perspective on the employment relationship (Marchington
and Wilkinson, 2005). In this view organizations are conceptualized as a team in
which all participants are aiming for the same goal, have similar objectives and are
not in conflict with one another. The unitary perspective sees the organization as a
cohesive and integrated team, where everybody shares common values, interests
and objectives to achieve the goal of the efficient functioning of the enterprise.
Within this approach a key element is the recognition of the managerial preroga-
tive and the unrestrained ‘right to manage’. Managers are the single source of
authority and act in a benign and rational manner for the benefit of employees.
Resultantly a unitary view of the employment relationship would be framed and
constrained by the idea that conflict and dissidence are unnecessary, undesirable,
irrational and pathologically deviant behaviour. Any conflict that does arise will
be rationalized as being a reflection of frictional rather than structural problems
within the organization. Consequently, trade unions are viewed as being an unim-
portant and unnecessary intrusion into the organization. One final point about the
unitary perspective is the need to recognize there may be differing styles of man-
agement ranging from authoritarian to paternalistic, and the latter in particular
may underpin a more sophisticated unitarism which finds organizational expres-
sion in talk of ‘soft’ HRM in particular. Although the unitary perspective may be
easy to criticize for advocating an unrealistic view of the workplace, evidence sug-
gests that many British managers still hold unitaristic views of the workplace.
Indeed, Lucas (2004) suggests that unitaristic thinking is apparent in large parts of
the tourism and hospitality industry; and often this unitaristic thinking is the less
sophisticated version premised on cost-minimization and ‘unbridled’ individual-
ism, which creates a ‘poor’ employment experience for many in the industry.
The ‘them and us’ attitude which unitarism eschews is something that is
accepted as being integral to the pluralist perspective on the employment rela-
tionship. Conflict is accepted as being inevitable and rational because of the plur-
ality of interests in the organizational setting, though the resolution of such
conflict may be through differing approaches. In simple terms we can consider this
in terms of both collective and individual approaches.
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Collective approaches to conflict resolution will envisage a role for trade
unions to represent the interests of employees, though there may be very different
approaches adopted by trade unions depending on the institutional context in
which bargaining with employers takes place. For example, in the UK the rela-
tionship has often been characterized as being reflective of a ‘them and us’ culture,
where the relationship between employers and trade unions was antagonistic. In
attempts to institutionalize conflict in such an environment the bargaining process
would often be concerned with power bargaining or zero-sum ‘winner takes all’-
type bargaining. In such a process the relative economic strength of the employers
and trade unions could determine the eventual resolution of any such dispute. By
contrast, in a number of European countries the relationship between employers
and trade unions has been rather more consensual and premised on notions such
as ‘social partnership’ and ‘social dialogue’ (and see HRM in practice 10.1).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 220
HRM in practice 10.1 Social partnership
in Lufthansa
At a time when the airline industry has faced huge challenges in the 1990s and the post-
9/11 era, Lufthansa has drawn on the institutionally-embedded social partnership approach
common in Germany to stave of the worst effects of a downturn in the sector. At the
heart of this social partnership is an understanding that the company will consult and
negotiate with employees through works councils and trade unions. In particular, by con-
sidering the employee ‘voice’ the company has chosen to approach restructuring in a
manner which has not led to redundancies and a short-term response to the challenges
in the industry. This approach was in contrast to a number of other airline companies,
such as British Airways (BA) and Aer Lingus who both made large-scale job cuts in the
wake of September 11th. By a process of consultation and negotiation Lufthansa was
able to agree wage concessions and enhanced labour flexibility, through things like
changes in working time and voluntary unpaid leave to avoid redundancies. Though
these changes were made, overall there was no major deterioration in the terms and
conditions of employees. Consequently, the trust and co-operation between the social
partners was able to survive the immediate post-9/11 era and allowed the company to
consider a brighter future without the latent mistrust stemming from widespread redun-
dancies, a problem which faced other airlines.
Source: Turnbull et al. (2004).
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More recently, as we have already noted, many argue that British public pol-
icy has attempted to foster a climate which is more concerned with partnership
along European lines, a process that has also been driven to an extent by a number
of EU Directives encouraging greater consultation between employers and
employees. As well as collective approaches to conflict, disagreement can also take
place at a more individual approach. Again conflict is seen as inevitable but the
resolution of such conflict does not take place within a collective framework or
with the involvement of trade unions. Instead, the employment relationship is
based on employment contracts determined by market forces and common law
and ‘freely’ negotiated between employers and employees. Conflict may arise as
employees seek the highest level of reward, best conditions and least exacting
work, whilst employers seek the lowest level of payment, least costly conditions
and most efficacious and flexible use of labour.
In addition a final perspective initially developed by Fox (1974) and then refined
by others, adopts a more radical view of the employment relationship. In this radical/
Marxist approach the employment relationship is seen not so much in organiza-
tional terms, but in a much wider social, political and economic framework. In this
broader analysis of capitalist society capital and labour are conceptualized as being
engaged in an antagonistic ‘power struggle’ that is waged very much on capital’s
terms. Marxists or neo-Marxists argue that trade union power is illusory and only
maintains the delusion of a balance of power. In its purest form the Marxist per-
spective suggests that only by the working class gaining workers’ control will real
equality be established. In contemporary market-driven economies moves to work-
ers control are very unlikely. Nevertheless, it is important to recognize that the radi-
cal perspective provides the theoretical framework for more critical views of the
employment relationship, such as labour process analysis.
In sum, then there have been a number of significant changes in the employment
relations landscape in recent years. The shift from industrial to employee relations
Review and reflect
Think of your current workplace or where you have previously spent time on work place-
ment and consider which frame of reference best describes how conflict is managed. Is
this the best way to manage conflict?
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and the decline of trade union power and influence has led to increasing talk of a
more unitaristic and individualistic view of the employment relationship. As a
consequence there is often increasingly talk of the ‘death’ of trade unions, a view
which is now considered in more detail.
Trade unions: in terminal decline?
Awide range of factors has contributed to a decline in trade union membership in
the UK in recent years. In particular, the structural changes in the economy and the
decline in so-called ‘heavy’ industries such as coalmining, shipbuilding and steel
has particularly impacted on the unions. Equally, the legislative programme
enacted by the Conservative Governments in the 1980s and 1990s can clearly be
seen to be a significant influence. In addition to these aspects CIPD (2005) suggest
that global competitive pressures and employee attitudes are equally important.
In particular, younger people are unlikely to have ever belonged to a trade union
and it is suggested that many of them see no point in trade unions (LRD, 2004a).
The decline in trade union membership is within a context in which for the first
time in the UK there appears at first view to be much greater state support for
trade unions. This situation is a change from the past where historically there has
been little state support for trade union recognition in the UK and much of the
twentieth century could be best characterized as being voluntaristic, with minimal
intervention from the state in employment relations. More recently, though, there
has been greater state intervention, including the area of union recognition. In this
sense the Employment Relations Act (ERA) (1999) and (2004) means that trade
unions may gain recognition even where employers are implacably opposed to the
idea (LRD, 2006). Importantly though the legislation does not apply to small
Review and reflect
Trade unions are increasingly looking to recruit younger employees and in sectors where
they have previously had few members, such as tourism and hospitality. Think about your
own view of trade unions and consider why you think trade unions have had little suc-
cess in the past in recruiting members in the tourism and hospitality industry.
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employers, defined as those with 20 or fewer workers, which of course is the
majority of tourism and hospitality enterprises.
However, even within the changing employment relations landscape described
above it is arguable the extent to which trade unions are likely to make a significant
comeback. In part, this reflects a wider sense of managerial resistance to trade
unions. In attempting to understand the reasons for such resistance, Gall (2004)
notes how the period from 1979–1997 created what he terms a sense of ‘managerial
Thatcherism’. In essence, the legislative programme of primarily the Thatcher, but
also the Major, Governments sought to change the employment landscape by
severely restricting the ability of trade unions to organize and to take industrial
action and thereby secure recognition and successfully pursue their members’ inter-
ests in collective negotiations. For Gall one of the obvious outcomes that this period
engendered is a present day situation of ‘not insignificant employer opposition to
granting recognition’ (p. 36). Thus, despite the attempts by the Blair Governments to
ostensibly create an employee relations public policy which foregrounds a stronger
sense of partnership, it seems questionable, as Gennard (2002) argues, as to whether
there really is a ‘break with the past’. Indeed, some authors have gone so far as to
suggest that New Labour’s acceptance of the desirability of a largely deregulated
labour market as a source of economic competitiveness denotes a marked conver-
gence with the neo-liberal policies of the previous Conservative Governments and
has led to what is termed ‘Blatcherism’ (Red Pepper, 2004).
Regardless of debates concerning what is the most compelling explanation for
declining trade union membership and activity what is clear is the precipitous fall in
trade union membership. In 1979 there were 13289 million members, a density of
over 50 per cent. By 2005 the figure had declined to approximately 6.4 million, a
density of 29 per cent (DTI, 2006). Moreover, as Table 10.1 suggests low trade union
membership is not confined to the UK, but is also be seen in the US, Australasia and
large parts of Europe.
Whilst Table 10.1 outlines union density figures for the economy as a whole,
often the figure will be lower again for the tourism and hospitality sector. For
example, the International Labour Organization (ILO, 2001) has estimated that
globally the average figure for the tourism and hospitality industry is 10 per cent.
That said, we do have to exercise a degree of caution in recognizing this argument
not least because there may be significant differences between sub-sectors like
hotel and catering, compared to the airline industry, for example. Even then there
may be national differences in the relative strength of trade unions in certain
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sub-sectors. For example, within the hotel and catering industry in the UK the cur-
rent trade union density is 4.2 per cent and trade unions have little real purchase or
influence (DTI, 2006). Conventionally a number of reasons are forwarded for low
levels of trade union density in the UK hotel and catering sub-sector (Macaulay and
Wood, 1992; Aslan and Wood, 1993; Lucas, 2004 and see also HRM in practice 10.2).
? Ethos of hotel and catering – for example the suggested conservatism and indi-
vidualism of the workforce and reliance on informal rewards tends to create a
workplace culture which is antipathetic to trade unions. The self-reliance that
this individualism tends to breed means that employees prefer to represent
themselves in negotiating with management.
? The predominance of small workplaces and their wide geographical dispersion
pose considerable challenges to trade union recruitment and organizing strategies.
The existence of a ‘family culture’ in many small and medium-sized enterprises
(SMEs) is also considered a significant barrier to organizing. For example, Lucas
(2004) in her interrogation of the 1998 Workplace Employee Relations Survey
(WERS) data found that hospitality employees in very small workplaces demon-
strated a much higher level of positive endorsement for their manager’s style of
management.
? Structure of the workforce – the workforce has high numbers of young workers,
students, part-timers, women, employees from ethnic minorities and migrant
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 224
Table 10.1 Union density in selected countries
Country % Union density (2003)
US 12.4
Australia 22.9
Japan 19.7
Germany 22.6
France 8.3
Italy 33.7
Sweden 78
Netherlands 22
Ireland 35.3
New Zealand 22 (2002 figure)
Derived from Visser (2006).
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workers, all groups who are not traditionally associated with trade union mem-
bership. This situation is also exacerbated by high labour turnover.
? Employer and management attitudes – as we have already noted the industry is
characterized by a unitary view of the employment relationship that sees no role
for trade unions. Consequently employers and managers are hostile towards
trade unions and will often pursue an active non-union policy.
? Role of trade unions – notwithstanding recent attempts by the Transport and
General Workers Union (T&G) and the GMB to organize parts of the hospitality
sector it is generally acknowledged that for too long trade unions failed to
develop effective strategies to organize the sector.
Although trade unions have failed to establish any real foothold within the UK
hotel and catering industry there is some evidence that they have had greater suc-
cess elsewhere and in doing so improved the working lives of their members (and
see HRM in practice 10.3 and 10.4).
As we noted earlier the relative lack of trade union presence is not universal in
the tourism and hospitality industry in terms of the relative strength of trade
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 225
HRM in practice 10.2 Failing to organize the
Dorchester Hotel
Wills (2005) reports how the T&G targeted the world-famous Dorchester Hotel in 1999
in attempts to gain union recognition. The Dorchester was targeted as it was a stand-
alone hotel which did not belong to a national or international chain, so for the purposes
of 1999 ERA would be counted as a single bargaining unit. From 1999–2002 the T&G
sought to gain union recognition. Although some employees did join the union, high
levels of labour turnover and the ethnic diversity of the staff made it difficult to sustain a
common union identity. When the T&G came to present its case to the Central
Arbitration Committee in December 2002 the union was unable to present a sufficiently
compelling case that a majority of workers constituting the bargaining unit would be
likely to support recognition. In part, this was due to the Dorchester claiming more work-
ers worked in the hotel than the T&G; although the union also found that a number of
their claimed members were either duplicate members or were no longer employed. The
failure to organize the Dorchester seems to point to the need for British unions to change
their tactics in seeking recognition and to develop a broader geographical, occupational
and sectoral focus, rather than concentrating on the level of the individual workplace.
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unions in different sub-sectors. For example, Baum (2006) recognizes that the airline
industry has always had a stronger trade union presence when compared to the
hotel and catering sub-sector, even in the UK (and see HRM in practice 10.5).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 226
HRM in practice 10.3 Unions making a difference
in the US
Research conducted by Bernhardt et al. (2003) in eight (half of which were unionized)
high-end, full-service ‘Class A’ hotels in four US cities found that unions could make a
difference to employees lives. The research focused on room attendants and food and
beverage staff and amongst other things found that in the unionized hotels wages were
higher, work intensity was lower, contract provisions on workload were more constrain-
ing and innovative bargaining was more prevalent. Such outcomes involve a partnership
of unions and management. These union–management partnerships, it was suggested,
can help to tackle industry-wide problems and demonstrate that ‘win-win’ or ‘mutual
gains’ solutions are possible in the hotel industry.
HRM in practice 10.4 Enhanced labour flexibility
in Australian hotels
Research by Knox and Nickson (2007) suggests that within Australia some hotel employers
engage in successful firm-level bargaining with trade unions, with unionization rates across
the industry far higher than in the UK. Case studies of two hotels found that management
at hotels with enterprise bargaining had decided to pursue both service excellence and cost-
minimization. This strategy focused on introducing employment practices that provided the
dual benefits of quality enhancement and cost reduction in such a way that they were not
in conflict with one another. This situation was achieved through partnerships and bargain-
ing with the trade union. The employers believed that they could best achieve their aims by
bargaining with the union rather than directly with employees because they were concerned
with receiving the support and co-operation of the workforce. Sophisticated rostering sys-
tems were introduced in order to align the needs of employer and employee more effect-
ively. The hotels also exhibited a strong commitment to enhanced functional flexibility, with
initiatives directed towards improving multi-skilling, service quality, ongoing training and
development and retention. In sum, the research highlighted Australia’s unique institutional
context and the potential benefits associated with regulation and union involvement.
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In sum, although there may be some pockets of trade union strength in the
tourism and hospitality industry, generally trade unions remain a marginal presence.
In a broader sense clearly any future for the trade union movement is contingent
upon their ability to organize in the service sector. The evidence to date suggests that
this may well be an uphill struggle for the trade union movement. As a consequence
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 227
HRM in practice 10.5 Conflict in BA
BA has had something of a chequered history in recent years in its dealings with trade
unions. When in 2003 the company sought to introduce a new automated time recording
system for check-in and ticketing staff it found itself involved in a costly industrial dispute.
The row centred on the introduction of a new electronic clocking-on system at Heathrow
airport, which staff feared would be used to push through other changes in pay and con-
ditions, such as the introduction of split shifts and annualized hours. These concerns and
the manner in which the system was being ‘imposed’ led to a two-day unofficial strike by
members of the GMB, T&G and Amicus trade unions. The dispute led to the cancellation
of over 500 flights affecting thousands of passengers. As well a PR disaster the dispute was
estimated to have cost the company £50 million. More recently the company also found
itself embroiled in an equally damaging dispute, albeit one not directly of its own making.
In 1997 BA chose to outsource its in-house catering operation to a company called Gate
Gourmet, who were the sole catering supplier for the company. Gate Gourmet was already
paying relatively cheap wages to their workers when in an attempt to drive down wages
even further the company employed 130 agency staff. This was despite the company’s pre-
vious attempts at restructuring, which had led to redundancies. As a result the original staff
held a meeting to wait for further news, which led to over 650 of them being sacked. In
response BA found itself facing costly sympathy action by baggage handlers and ground
staff, who were not only in the same trade union, T&G, as the Gate Gourmet workers, but
in some cases were also the husbands and brothers of the sacked workers. Once again BA
found itself having to cancel hundreds of flights, leading to over 100000 passengers being
stranded. As well as the immediate disruption caused by the action of the baggage hand-
lers the dispute in Gate Gourmet dragged on for several months customer refreshments to
some BA customer. The cost to BA of the strike action was estimated at between £35–45
million, though arguably the biggest cost was in terms of the company’s damaged reputa-
tion and lost custom in the future.
Derived from BBC (2005), Clark (2003), Morgan (2003) Townsend (2005).
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this lack of collective ‘voice’ provided by the trade unions means that most tourism
and hospitality employees are likely to sustain an influence in managerial
decision-making through the processes of employee involvement and participation.
Employee involvement and participation
As we have already noted there is a definitional and terminological debate on the
meanings of terms such as ‘employee involvement’, ‘employee participation’ and
‘industrial democracy’ (Blyton and Turnbull, 2004). Hyman and Mason (1995) sug-
gest that increasingly, talk of industrial democracy – which denotes a fundamental
change in the balance of power in society generally and the workplace specifically,
such as the establishment of employee self-management – has little currency in
contemporary market-driven economies. Consequently we are left with the notions
of ‘employee involvement’ and ‘employee participation’, which represent the ‘two
principal and in many respects contradictory approaches to defining and opera-
tionalizing employee influence’ (Hyman and Mason, 1995: 1).
Employee involvement
Marchington and Wilkinson (2005) recognize that there are a number of mecha-
nisms that have been introduced under the broad heading of employee involve-
ment, for example teamworking and empowerment to name just two. Whilst there
may be a number of differing initiatives there is nonetheless common agreement
of the intent of employee involvement. In that sense most writers recognize that
employee involvement is concerned with measures which are introduced by man-
agement to optimize the utilization of labour whilst at the same time securing the
employee’s identification with the aims and needs of the organization. Employee
involvement is seen as being very much a phenomenon of the 1980s and closely
linked with ‘soft’ HRM with its emphasis on unitarism and the creation of com-
mon interests between employer and employee. Employee involvement is man-
agerially initiated and characterized as direct, ‘descending participation’, which is
task-centred as it attempts to involve all individuals in the workplace (Salamon,
2000). In this way it seeks to provide employees with opportunities to influence
and take part in organizational decision-making, specifically within the context of
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their own workgroup or task. Therefore it is intended to motivate individual
employees, increase job satisfaction and enhance the sense of identification with
the aims, objectives and decisions of the organization. Organizations have a num-
ber of ways in which they can involve employees and Table 10.2 outlines the inci-
dence of these aspects in British workplaces with 10 or more employees, as found
in the 2004 WERS.
Marchington and Wilkinson (2005) note that these various techniques can be fur-
ther broken down between those where the organization simply communicates
downwards to employees, and those more concerned with upward problem solving.
With regard to downward communication it can be seen from Table 10.2 that this
form of employee involvement is especially prevalent amongst organizations. Direct
communication to the individual can take a variety of forms and involve a variety of
media both electronic and paper such as e-mail, intranet, company newsletters and
noticeboards. IRS (2005b) recently surveyed over 70 organizations across the econ-
omy and found that the most important aim of their communication strategy was
to keep employees informed about changes in the organization, closely followed by
improving employee engagement and improving employee performance. Though
downward communications can be useful in attempting to achieve these aims
through informing and ‘educating’ employees about managerial actions and inten-
tions they are also passive and are characterized by Marchington and Wilkinson
(2005) as the most ‘dilute’ form of direct participation. Indeed, Hyman and Mason
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 229
Table 10.2 Direct communication and information sharing techniques
Technique % of organizations using
technique
Meetings with entire workforce or team briefings 91
Systematic use of management chain 64
Regular newsletter 45
Noticeboards 74
E-mail 38
Intranet 34
Suggestion schemes 30
Employee attitude surveys 42
Adapted from IRS (2005a).
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(1995) suggest downward communications mechanisms are ultimately rather super-
ficial and question the extent to which they denote meaningful involvement.
By contrast a number of upward problem-solving techniques are more likely
to denote more meaningful involvement for employees, usually involving two-
way communication. These techniques may be directed at either individuals or
workgroups and are now considered. Suggestion schemes allow organizations to
potentially tap into the creativity in their workforce to make significant improve-
ments in just about every aspect of the business, for example improvements in
customer service (IDS, 2003). As a result they can improve the motivation and
commitment of workers, as they see their voluntary activity as being integral to
company success. Equally, there may also be more instrumental and tangible bene-
fits both to the individual, whereby employees are rewarded for ideas and for the
organization, who may accrue significant cost savings from suggestions emanat-
ing from employees. A second technique which aims to encourage more active
employee involvement is attitude surveys. More often than not employee attitude
surveys will be a census of all staff usually yearly or bi-annually (IDS, 2004).
Employees will usually be asked to give their views on a range of issues, including
(IDS, 2004):
? The organization’s strategic direction and leadership.
? Organizational culture.
? The organization as an employer.
? Pay and benefits.
? Working environment and conditions.
? Working relationships (i.e. with managers and colleagues).
? Company image.
? Overall satisfaction/commitment to the organization.
? Reaction to the survey and previous follow-up action.
The last point is important in delineating the need for organization’s to be trans-
parent in both disseminating results and being seen to act on them. As was alluded
to in Chapter 8 there may also be opportunities for employees to appraise their
manager’s performance. The suggested benefits of employees commenting on
managerial performance through employee attitude surveys are that it makes for
better management, although again this is contingent upon management accept-
ing and acting upon the results of surveys.
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In a group sense, initiatives within tourism and hospitality which seek to encour-
age employees’ involvement in upward communication are likely to be premised
on the notion of improving quality within the organization and towards the cus-
tomer, finding expression in techniques such as quality circles (QCs) and total
quality management (TQM). Lashley (2001) notes how QCs are essentially con-
cerned with consultation on the basis of management posing problems in the
expectation of receiving suggestions from employees. Suggestions are likely to be
directed towards improvements in service quality and productivity in particular.
He also reports evidence from the Accor Group where QCs have been used suc-
cessfully. Although employees were expected to act as volunteers and are not paid
for taking part in the QCs there was still significant interest amongst employees.
Amongst other things the QCs in Accor were able to speed-up customers breakfast
service and guest check-out times on the basis of identifying problems, suggesting
and testing solutions, measuring results and finally ‘rolling out’ the approved
solution. A more all-embracing approach to quality is via the notion of TQM,
which is more concerned to promulgate an integrated view of quality via
company-wide improvements in quality both towards the internal customer (the
employee) and the external customer. Baldachino (1995) reports a case study of a
luxury hotel where the implementation of a TQM philosophy was beset by a num-
ber of problems including employee suspicion of the rhetoric of TQM, empower-
ment and involvement when faced with the realities of redundancy, industrial
conflict and the more prosaic problem of a ‘them and us’ attitude emerging over
the car parking situation for managers and employees at the hotel. More sanguine
accounts of TQM claim several benefits from such a philosophy, including,
improved organizational efficiency, greater employee involvement, consistently
‘delighting the customer’ by exceeding their expectations and reduced labour
turnover (Hope and Muhlemann, 1998). An integral part of a TQM framework is
Review and reflect
Imagine you are a manager in a travel agency which is part of a large multinational com-
pany. As part of their involvement scheme the company runs an attitude survey which
gives employees the opportunity to comment on your performance. In the last survey
your employees have said that you are dictatorial and difficult to approach, how do you
respond?
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the role of empowerment, which is often seen as being synonymous with greater
employee involvement.
Empowerment may actually encompass a variety of employee involvement
techniques (Wilkinson, 1998; Lashley, 2001), though for clarity we will talk here of
empowerment as being predominately about encouraging front-line staff to solve
customers problems on the spot, without constant recourse to managerial
approval. As was discussed in Chapter 3 tourism and hospitality organizations are
increasingly attempting to develop an organizational culture which places quality
service at its centre. With customer expectations becoming ever more dynamic
empowerment is increasingly sold as being the key to achieving not only high levels
of service quality but also as a means to enhance the commitment and job satisfac-
tion of employees. In principle, empowerment allows employees to exercise greater
authority, discretion and autonomy in their dealings with guests. In reality, the lat-
itude allowed to employees is often circumscribed. For example, Jones et al. (1997)
in their study of the Americo hotel chain found that the use of a ‘compensation
matrix’ would dictate employee responses and allowed management to monitor
and measure such responses, creating tightly constrained discretion (see also Hales
and Klidas, 1998). Thus, although the rhetoric of empowerment is about attempting
to move decisively from a control-oriented organization to a commitment-oriented
organization, Riley (1996: 171) pragmatically recognizes that whilst ‘empowerment
is giving the employees the right to “break the rules” to serve the customer’ it is
also nonetheless important to recognize that ‘rules are always necessary for an
organization. It is a balance between organizational rules and discretion which
must be available quickly’.
As we recognized in Chapter 7 training and development of employees is also a
crucial part in operationalizing empowerment strategies, with employees requir-
ing training in areas like, social skills, communication skills, decision-making
skills, problem-solving skills, planning skills and teamworking. Relatedly there
will also be a need to re-orient managerial thinking towards a more facilitative and
coaching style, which should also attempt to impart a greater sense of trust and
Review and reflect
Can you really have empowerment which involves tightly constrained discretion?
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 232
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confidence in the ability of the front-line staff to make suitable decisions. This does
not mean that management’s role is completely emasculated or abrogated but
merely refined, although this may be particularly difficult for managers to accept
(Wilkinson, 1998). Equally it is important to create a ‘no blame’ culture where ‘well
intentioned errors’ are discussed in a supportive way in order that lessons can be
learned from any mistakes in decision taking by employees.
This latter point can be seen as one of the obvious benefits of empowerment
and a review of several writers suggests several other benefits to be derived from
empowerment (Wilkinson, 1998; Lashley, 2001; Baum, 2006):
? Reduction in the so-called social distance between customers and employees, so
service is not seen as servility.
? Improved quality and guest satisfaction, as the removal of close supervision cre-
ates a more responsive service delivery system.
? Enhanced motivation and job satisfaction for employees, leading to greater
commitment and reduced labour turnover.
? More time for managers to engage in strategic planning and customer
responsiveness.
? Cost savings and improvements from ideas generated by employees.
? Word of mouth advertising.
On the other hand there may also be a number of potential problems in empower-
ing employees. We have already noted how reality may not match the rhetoric of
companies in relation to the tightly constrained discretion which characterizes
many empowerment schemes. In addition, employees may also see empowerment
as about increasing risks and responsibilities without any commensurate extra
reward for the additional skills and discretion they are expected to demonstrate.
A further issue is that of job security, as empowerment may be used to justify
delayering, which in turn leads to a drastic reduction in the number employed by
the organization. There is also the vexed issue of the culturally-bound nature of
empowerment, which is often seen as a very Americanized approach to service
(Nickson, 1999). Consequently, and as we noted in Chapter 2, it may be especially
difficult to create an empowered culture in countries such as China and the post-
communist Eastern European states, though even within parts of Western Europe
there is also evidence of significant resistance to the precepts underlying empower-
ment (Klidas, 2002).
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Employee participation
Hyman and Mason (1995: 21) define participation as ‘state [or supra-state] initia-
tives which promote the collective rights of employees to be represented in organ-
izational decision-making, or to the consequence of the efforts of employees
themselves to establish collective representation in corporate decisions, possibly in
the face of employer resistance’. Salamon (2000) characterizes participation as
being pluralist, power-centred, indirect, representative and ‘ascending’ in its focus
on the managerial prerogative and attempts to extend employees collective inter-
est into a variety of areas and decisions at higher levels of the organization. The
expression of employee interests over company decisions may be via joint consult-
ation, works councils and worker directors. With regard to joint consultative com-
mittees (JCCs), Lucas (2004) notes how data from WERS 1998 suggests that
management committees for joint consultation, rather than negotiation, are rare in
the tourism and hospitality industry. Moreover, where such committees do exist
they tend to have quite a narrow focus in terms of what they will allow consultation
on. As Lucas notes, ‘Where committees function in the HI [hospitality industry],
health and safety is most likely to be discussed, followed by training, working
practices and welfare services and facilities. Pay and government regulations are
the least frequently discussed issues’ (p. 161). Consequently, in this section the
focus is mainly on works councils, both European and national.
European and national works councils
Hyman and Mason (1995: 32) suggest works councils are, ‘a representative body
composed of employees (and possibly containing employer representatives as
well) which enjoy certain rights from the employer’. Works councils have two
principal rights; firstly, the right to receive information on key aspects of company
activity, such as restructuring, HRM/personnel issues, health and safety, etc., and
secondly, the right to consultation on such issues prior to their implementation by
management. Works councils are common in Europe and often underpin approaches
based on social partnership, but have been a relatively rare phenomenon in the UK
with only a small number of companies setting up voluntary agreement (and see
HRM in practice 10.6).
More recently though within the UK especially the situation has changed with
European-inspired regulation, which has established European Works Councils
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EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 235
HRM in practice 10.6 PizzaExpress: Spreading
the word
As was noted in Chapter 9 PizzaExpress’ image was seriously damaged in 1999 following
the revelation that they had been rather disingenuous in their interpretation of the min-
imum wage legislation in the UK. Clearly, the company had to start improving internal com-
munication to pinpoint and address sensitive issues which arose from this dispute. To tackle
this problem, the HR department gave the job of communications manager to Steve
Perkins, who was then a member of the restaurant staff. Perkins decided to set up a
company-wide works council system similar to those running in EU nations. The first step
was to look at other companies’ practices but Perkins was told to develop a system that
best suited the company. The new communication system took more than 18 months to
become fully effective. The work councils are now run at local, regional and national levels,
from individual restaurants to headquarters. They involve managers and staff representa-
tives alike. At the restaurant level, forum discussions are held every 2 months and involve
managers, staff representatives and staff themselves who are encouraged to express their
concerns. Problems can be settled at this stage, although unresolved issues can be taken to
one of the seven regional councils held by regional managers and restaurant representa-
tives. Again, issues can be brought to the national forum, which meets every 6 months and
involves top-executives and board members. The new works council witnessed several
breakthroughs. For instance, the system prevented massive complaints from employees
about reduced wages, when the company was only trying to take out an amount of the
wages to adjust it tax-wise and give it back at a lower tax rate. Thanks to the forum, rep-
resentatives were able to identify and calm their colleagues’ fears. From a company point
of view the consultative process also has the advantage of avoiding negotiations with
unions and resulting strike threats. Despite its successes, however, the communication sys-
tem would not have worked without PizzaExpress’ commitment, which was fundamental
in gaining staff commitment to the process. As James Sydmonds, the national forum rep-
resentative for Café Pasta, said, ‘When I started on the forum, I was very suspicious … Every
time I got to a different level and an issue was brought up, I’d think: “What is actually going
to happen at the next level?” But the company involvement has surprised me, and I have
been so impressed that I have wanted to get more involved and spread the gospel’.
Derived from Cooper (2001), Goymour (2000).
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(EWCs) and national works councils. The Directive establishing EWCs was
adopted in September 1994. It was not though till 2000 that the Directive was
finally implemented in the UK. The Directive covers all companies with a presence
in more than one EU Member State and with at least 1000 employees in total, of
which at least 150 are located in each of two EU Member States (CIPD, 2006).
Importantly, companies do not automatically have to establish a EWC, though both
companies and employees (or their representatives) can trigger mechanisms to
request a EWC (LRD, 2006). The voluntary nature of EWCs means that of the more
than 2000 companies covered by the Directive only around a third have established
EWC arrangements (CIPD, 2006). Within tourism and hospitality Lucas (2004)
notes that a relatively small number of companies have introduced EWCs, a num-
ber of whom were headquartered in Europe (and see HRM in practice 10.7).
In addition to EWCs the EU parliament also adopted the information and con-
sultation of Directive in March 2002, which was implemented in the UK as the
Information and Consultation of Employees Regulations 2004 (ICE Regulations).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 236
HRM in practice 10.7 Club Med
Club Med is a French company and one of the world leaders in holiday villages. The com-
pany operates in over 40 countries and has more than 20000 employees. Club Med intro-
duced its EWC in September 1996, though prior to this date the company had previously
worked with unions to resolve issues such as re-employing seasonal staff and helping non-
French nationals to settle into working in France. Initially the EWC agreement was signed
for a period of 3 years, though in 1999 the agreement was renewed indefinitely.
Employee representatives are provided by the trade unions, both at a European level and
for several individual countries in which Club Med operates. The EWC allows for the pro-
vision of information, reflection and consultation between the partners. Information
provided through the EWC encompasses economic and financial matters, strategic per-
spectives, the employment situation, organizational changes and their consequences. In
difficult times, such as the post-9/11 period, the process of consultation allowed the EWC
to engender consensus on issues such as restructuring in what were difficult circum-
stances. In sum, the Club Med EWC is suggested as having several benefits including:
effective joint action during restructuring programmes with an impact on employment;
production of ethics guidelines on sub-contracting to support local conflicts; and
exchanges on strategic orientations or organizational changes within the group.
Source: EFILC (2005).
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The Directive required Member States to ensure that employers are under an
obligation to consult with their workforce on an ongoing basis in order that
employees have a better idea of potential changes in their employment. As was
noted earlier these types of arrangements are common in many parts of Europe,
though much less so within the UK context. For example, if we take JCCs as a
rough proxy for the sort of mechanisms required by the ICE Regulations then
WERS 2004 found that JCCs were present in 14 per cent of all UK workplaces,
though this varied markedly between size of the workplace, with the figures being
26 per cent in workplaces with 50–99 employees and 47 per cent in those with
100–199 employees (Kersley et al., 2006). From April 2005 the ICE Regulations
applied to companies with more than 150 employees, though it will cover those
with at least 100 from April 2007 and those with at least 50 from April 2008. Under
the terms of the ICE Regulations employees will have the right to be (LRD, 2004b):
? Informed about the organization’s economic situation.
? Informed and consulted about its current employment situation and employ-
ment prospects.
? Informed and consulted about decisions likely to lead to major changes in con-
tractual decisions or work organization. This could cover a range of topics includ-
ing working time and practices, training, equal opportunities and pensions.
Employers covered by the ICE Regulations will not automatically have to inform and
consult with employees, and indeed some employers may have pre-existing arrange-
ments that are considered acceptable. In workplaces without any existing arrange-
ments employees can make a request for the establishment of information and
consultation procedures. As long as 10 per cent of employees support such a request
the employer then has to provide a mechanism for information and consultation
(IDS, 2005). At the time of writing it is too early to say what effect the ICE Regulations
are likely to have in the long term. However, it does seem set to continue the trend
of Europeanization of employee relations activities in the UK, though whether this
ultimately leads to real social partnership and dialogue remains to be seen.
Conclusion
In this chapter we recognized that whilst there may be broad agreement on the
principle of ensuring that employees have a voice in managerial decision-making
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the form of influence will vary enormously. In some institutional contexts the
voice may be provided by trade unions. This is especially true for a number of
European countries where the principle of social partnership ensures that unions
play an active part in organizational decision-making. In the UK though it is more
likely that within the tourism and hospitality sector that employee influence will
be sustained through a variety of involvement and participation mechanisms.
There is much debate as to the efficacy – in relation to issues like improving
employee morale and raising productivity – and democratic intent of employee
involvement, and particularly the extent to which the various initiatives represent
‘pseudo-participation’ in their lack of a challenge to the managerial prerogative.
On the other hand it remains to be seen whether the representative approaches
which are now increasingly encouraged through a number of European Directives
will provide the meaningful participation that is intended. Ultimately approaches
to employee involvement and participation should aim to promote improved dia-
logue in the workplace. Workplaces that involve and engage their employees in
matters that effect their employment experience are likely to benefit through
increased commitment and motivation; something that social partnership seems
to have achieved in a number of European contexts and from which lessons can
seemingly be drawn by UK companies.
References and further reading
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agers’, Employee Relations, 15(2), 61–70.
Baldachino, G. (1995) ‘Total quality management in a luxury hotel: a critique of practice’, International
Journal of Hospitality Management, 14(1), 67–78.
Baum, T. (2006) Human Resource Management for Tourism, Hospitality and Leisure: An International
Perspective, Thomson Learning.
BBC (2005) ‘Gate Gourmet settlement reached’, at http://news.bbc.co.uk/1/hi/business/4284858.stm
(accessed 6 July 2006).
Bernhardt, A., Dresser, L. and Hatton, E. (2003) ‘The coffee pot wars: unions and firm restructuring in the
hotel industry’, in E. Appelbaum, A. Bernhardt and R. J. Murnane (eds.) Low Wage America, Russell Sage
Foundation, 33–76.
Blyton, P. and Tunbull, P. (2004) Dynamics of Employee Relations, Palgrave MacMillan, 3rd edition.
Chartered Institute of Personnel and Development (2005) What is Employee Relations?, CIPD.
Chartered Institute of Personnel and Development (2006) European Works Councils Factsheet, CIPD.
Clark, A. (2003) ‘Conflict and confrontation in the air’, Guardian, 24 July, 5.
Cooper, C. (2001) ‘Talking Italian’, People Management, 14 June, 38–41.
Department of Trade and Industry (2006) Trade Union Membership 2005, DTI.
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European Foundation for the Improvement of Living and Working Conditions (EFILC) (2005) ‘EWC Case
Studies: Club Med’, at http://www.eurofound.eu.int/pubdocs/2005/7140/en/1/ef057140en.pdf (accessed
12 July 2006).
Fox, A. (1966) ‘Industrial sociology and industrial relations’, Royal Commission Research Paper No. 3, HMSO.
Fox, A. (1974) Beyond Contract: Work, Power and Trust Relations, Faber.
Gall, G. (2004) ‘British employer resistance to trade union recognition’, Human Resource Management
Journal, 14(2), 36–53.
Gennard, J. (2002) ‘Employee relations public policy developments, 1997–2001: a break from the past?’,
Employee Relations, 24(6), 581–594.
Goymour, D. (2000) ‘Let’s talk’, Hospitality, May, 28.
Hales, C. and Klidas, A. (1998) ‘Empowerment in five star hotels: choice, voice or rhetoric?’, International
Journal of Contemporary Hospitality Management, 10(3), 88–95.
Hope, C. and Muhlemann, A. (1998) ‘Total quality, human resource management and tourism’, Tourism
Economics, 4(4), 367–386.
Hyman, J. and Mason, B. (1995) Managing Employee Involvement and Participation, Sage.
Income Data Services (2003) Suggestion Schemes, IDS Studies No. 752, June.
Income Data Services (2004) Employee Attitude Surveys, IDS Studies No. 777, July.
Income Data Services (2005) Information and Consultation Arrangements, IDS HR Studies No. 790, January.
Industrial Relations Services (2005a) ‘Evolution, not revolution – the changing face of the workplace’, IRS
Employment Review, No. 832, 30 September, 8–15.
Industrial Relations Services (2005b) ‘Dialogue or monologue: is the message getting through’, IRS
Employment Review, No. 834, 28 October, 8–16.
International Labour Organization (2001) Human Resource Development, Employment and Globalization
in the Hotel Catering and Tourism Sector, ILO.
Jones, C., Nickson, D. and Taylor, G. (1997) ‘Whatever it takes? Managing “empowered” employees and
the service encounter in the international hotel industry’, Work, Employment and Society, 11(3),
541–554.
Kersley, B., Alpin, C., Forth, J., Bryson, A., Bewley, H., Gix, G. and Oxenbridge, S. (2006) Inside the Workplace:
Findings from the 2004 Workplace Employment Relations Survey, Routledge.
Klidas, A. (2002) ‘Employee empowerment in the European cultural context: findings from the hotel indus-
try’, paper to the CRANET 2nd International Conference on Human Resource Management in Europe:
Trends and Challenges, Athens.
Knox, A. and Nickson, D. (2007) ‘Regulation in Australian hotels: is there a lesson for the UK?’, Employee
Relations, 29, 1.
Labour Research Department (2004a) ‘What do young people know about unions’, Labour Research,
March, 17–19.
Labour Research Department (2004b) ‘Be organized, be consulted’, Labour Research, November, 17–19.
Labour Research Department (2006) Law at Work, LRD.
Lashley, C. (2001) Empowerment HR Strategies for Service Excellence, Butterworth and Heinemann.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
Macaulay, I. and Wood, R. (1992) ‘Hotel and catering industry employees’ attitudes towards trade unions’,
Employee Relations, 14(2), 20–28.
Marchington, M. and Wilkinson, A. (2005) ‘Direct participation and involvement’, in S. Bach (ed.)
Managing Human Resources: Personnel Management in Transition, 4th edition, Blackwell, 398–423.
Morgan, O. (2003) ‘Swipe strike costs BA £50m’, Observer Business Section, 27 July, 1.
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 239
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Nickson, D. (1999) A Review of the Internationalization Strategies of Three Hotel Companies with a
Particular Focus on Human Resource Management, unpublished PhD Thesis, University of Strathclyde.
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Butterworth-Heinemann.
Salamon, M. (2000) Industrial Relations – Theory and Practice, 4th edition, Prentice Hall.
Sisson, K. (2005) ‘Responding to Mike Emmott: What “industrial relations” suggests should be at the heart of
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download/gid,2/ (accessed 5 July 2006).
Townsend, M. (2005) ‘BA makes a meal of sari strike’, The Observer, 14 August, 15.
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European civil aviation industry’, European Journal of Industrial Relations, 10(3), 287–307.
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Wills, J. (2005) ‘The geography of union organizing in the low-paid service industries in the UK: lessons
from the T&G’s campaign to unionize the Dorchester in London’, Antipode, 37(1), 139–159.
Websites
The Trades Union Congress website gives a sense of their views on a range of employment and political
issues http://www.tuc.org.uk
There are a number of case studies concerning employee participation in European companies at
http://www.eurofound.eu.int/areas/participationatwork/index.htm
The hospitality, leisure, sport and tourism support network has a useful guide to empowerment, involvement
and participation at http://www.hlst.heacademy. ac.uk/resources/guides/empowerment.html
http://www.ilisimatusarfik.gl/eng/index_eng-filer/index_eng.htm is an international site with links to many
organizations involved with employee participation and involvement.
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Chapter 11
Welfare, health and
safety
Chapter objectives
This chapter considers the range of issues
concerned with the development of welfare
policies in tourism and hospitality. Recognizing the
ethical, legal and business aspects of welfare this
chapter aims to:
? Appreciate the differing rationales for
developing welfare policy.
? Consider the balance between the public and
private life of organizational members.
? Recognize the increasing business emphasis in
the development of welfare policies.
? Assess the extent to which welfare issues are
particularly resonant within the tourism and
hospitality industry.
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 242
Introduction
Every year thousands of people suffer serious injury or even death in the work-
place. Many more suffer from work-related illnesses or are absent from work due
to work-related stress. In order to alleviate dangers in the workplace and ensure
that employees are working in a healthy or happy environment it is essential that
tourism and hospitality organizations consider the development of appropriate
welfare policies. Goss (1994: 122) recognizes how, ‘Welfare provision generally
refers to those policies which are directed at some aspect of employee well being,
both in a physical and emotional sense.’ Torrington et al. (2005) suggest that the
physical aspects of a broader welfare policy stem from measures to improve health
and safety in the workplace, as well as issues such as the provision of paid holi-
days and reduced working hours. From an emotional/psychological perspective
organizations are likely to be concerned with the mental well being of their
employees, or more broadly anything involving the ‘human relations’ needs of
people at work. Of course, in reality there is a degree of interconnectedness
between physical and mental aspects of welfare, though it is also important to con-
sider the potential distinctions that may be made between them.
From the above discussion we might ask ourselves why should organizations
have a welfare policy and indeed whether the subject of the more sensitive aspects
of welfare-related issues should remain personal and private. To answer these
questions we should recognize various reasons for the existence of welfare pol-
icies. Goss (1994) suggests that organizations have usually developed welfare pro-
vision within the paradigm of three common ‘welfare rationales’, these being:
legal-reactive, corporate conscience and company paternalism and these are now
briefly discussed.
? Legalistic-reactive: In this approach an organization’s approach to welfare policy
is primarily driven by legislative requirements, for example responding to
health and safety legislation. With such an approach the organization does not
see developing welfare policy as an important part of its core objectives but
rather something that has to be complied with.
? Corporate conscience: Here, Goss notes how historically the role of personnel had a
strong welfare orientation and, arguably, how over time this welfarist approach
became increasingly seen as ‘soft’ and ‘indulgent’, especially within a more com-
petitive business environment.
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WELFARE, HEALTH AND SAFETY
? Company paternalism: This approach is concerned with the ‘fatherly’ manner in
which organizations would seek to look after all aspects of their employees
lives. By taking an ‘encompassing’ approach, company’s that practiced com-
pany paternalism would be concerned not only with the immediate work envir-
onment, but the manner in which employees lived their lives outside of work.
Underpinning company paternalism is a strong sense of religious and moral
commitment and employees would be expected to lead a live which fitted with
this ethos (see also Nickson (1997) for a description of company paternalism in
the Marriott, Hilton, Holiday Inn and Forte organizations).
In many respects the above description of differing welfare rationales has a clear
overlap with some of the discussion in Chapter 6 on equal opportunities. In the
earlier chapter on equal opportunities the question was considered as to whether
organizations should develop policies due to legal, ethical or business aspects and
the same arguments can be made with regard to the welfare of employees. Clearly
within this discussion the legal dimension is one that cannot be ignored and this
aspect will be a concern throughout the chapter. To an extent the notion of corpor-
ate conscience and company paternalism would seem to rest more on an ethical
view of welfare. Increasingly though it is argued that the main argument for develop-
ing welfare policies is from the point of view of the HRM business case/efficiency
argument. Much of this discussion about adopting a more efficient approach to
welfare is generally seen through the lenses of savings costs by reducing absence
and improving the performance of employees in the workplace by addressing any
problems or concerns that they might have. Clearly then welfare is an important
topic, which may conceivably cover a variety of different issues. In this sense we
can think of a welfare ‘alphabet’, encompassing a range of issues, such as: absence
management, AIDS/HIV, alcohol/drug misuse, smoking, stress, working time
and workplace violence. These aspects are now considered.
Absence management
Increasingly organizations are attempting to take a more proactive approach to the
management of absence, recognizing both its direct and indirect costs. With regard
to direct costs IDS (2005a) note how absence can be a significant drain for organ-
izations in terms of the cost of occupational sick pay, lost production or the need to
243
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 244
bring in replacement staff. CIPD (2005a) note that 9 out of 10 organizations report
that absence is a ‘significant’ or ‘very significant’ cost to the business. Overall, the cost
of absence to the UK economy is £11 billion (Simms, 2005), and more specifically
CIPD (2005a) notes how the cost per employee is £601 (see HRM in practice 11.1).
More indirectly, and less easy to quantify, absences may place burdens on other
organizational members, leading to poor morale, lower productivity, reduced cus-
tomer retention and profitability (IRS, 2001; IDS, 2005a). In the CIPD (2005a) annual
survey of rates of sickness absence hotels, restaurants and leisure had an absence
rate of 3.2 per cent and on average employees took 7.3 days off sick. In comparing
these figures to other sectors, hospitality and tourism has higher absence rates than
private services generally (3.0 per cent and 6.8 days), yet compares favourably with
the economy as a whole (3.7 per cent and 8.4 days). There is also the vexed issue of
whether sickness absence is ‘genuine’. The absence survey by the CIPD (2005a) sug-
gested that 14 per cent of absence across the economy as a whole is not genuine.
Indeed, a previous survey conducted in 2004 by the Confederation of British
Industry found a similar figure (15 per cent), whilst also noting that retail and dis-
tribution, hotels and restaurants were amongst the sectors with the highest levels of
non-genuine absence (respectively, 21 per cent and 19 per cent) which arguably
points to underlying employment and HRM-related problems (IRS, 2004b).
CIPD (2006a) notes that in broad terms there are two types of absence, short
term and long term – defined as 10 days or more (Simms, 2005). Short-term sick-
ness absence will usually be uncertificated, self-certificated or covered by a doctor’s
note. For longer-term absence there may be a need to involve occupational health
professionals or utilize rehabilitation programmes in order to get the employee
HRM in practice 11.1 The UK: The sick man
of Europe?
IRS (2004a) reports recent research by the European Union (EU) which suggests that the UK
has a particularly poor health record with more than one in four working age adults having
a long-term health problem. This figure was second only to Finland (32.2 per cent) and
higher than direct competitors such as Germany (11.2 per cent), France (24.6 per cent) and
Holland (25.4 per cent). The lowest figures in the survey were Romania (5.8 per cent) and
Italy (6.6 per cent). For those actually in employment, the UK again has one of the highest
rates of employees suffering long-term health problems at 20.4 per cent (surpassing only
Finland and France), compared to the EU average of 12.7 per cent.
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back to work (CIPD, 2006a), though this may be more likely in larger organizations
(IRS, 2004b). There are a number of causes of absence, though the most prevalent
is usually minor illness, such as colds or flu. Other reasons for absence include
aspects such as back pain, musculo-skeletal injuries, stress, mental ill health and
recurring medical conditions (CIPD, 2005a).
Regardless though of the nature of the absence and whether it is short or long
term increasingly it is suggested that there is a need for organizations to adopt a more
proactive approach, especially if the costs described previously and so-called non-
genuine illness are taken into account. For example, it is suggested that organizations
are making progress in measuring absence and taking specific steps to address the
most obvious causes. Though it is also important that such an approach is seen as
part of a broader integrated approach to create a healthy, high-quality workplace,
where the link between employer performance and employee satisfaction is clearly
understood. At the least though the organization should have a basic sickness
absence policy, which should aim to (CIPD, 2006a: 3):
? Provide details of contractual sick pay terms and its relationship with statutory
sick pay.
? Outline the process employees must follow if taking time off sick – covering
when and whom employees should notify if they are not able to attend work.
? Include when (after how many days) employees need a self-certificate form.
? Contain when they require a medical certificate (sick-note) from their doctor to
certify their absence.
? Mention that the organization reserves the right to require employees to attend
an examination by a company doctor and (with the employee’s consent) to
request a report from the employee’s doctor.
? Include the provision for return-to-work interviews as these have been identi-
fied as the most effective intervention to manage short-term absence.
HRM in practice 11.2 notes an attempt by British Airways to take a more proactive
approach to managing absence, which amongst other things demonstrates the
importance of training line managers to become involved in the process of man-
aging absence.
In an even more proactive vein some companies are also moving towards
using a new trend imported from the US, that of ‘wellness’ or health management
at work, which may be particularly apposite in those leisure-oriented sub-sectors
of the tourism and hospitality and is considered in HRM in practice 11.3.
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 246
HRM in practice 11.2 Tackling absence at
British Airways
British Airways had previously had real problems with levels of absence in the company. In
2002, the company acknowledged the scale of the problem by choosing to go ‘loud,
proud and wide’ on the issue. By October 2004, the average absence per employee was
16.7 days per year, well above the sectoral average. Around 90 per cent of this absence
was short term and the overall cost to the company was put at £70 million. It was at this
time that British Airways introduced a new absence management policy, which developed
a single set of clear absence policies and procedures for all staff. The aim of the new
approach was to reduce absence by March 2006 to an average of ten days per employee,
thus saving the company an estimated £30 million annually. As Peter Holloway, British
Airways head of people and organizational development, recognizes, ‘absence manage-
ment is not fun, sexy or exciting; it is about day to day following through of simple man-
agement practices’. Recognizing this point, amongst other things the new policy sought
to encourage regular attendance at work, promote early intervention from line managers
and HR managers and provide support for those with legitimate reasons for absence with
the intent of assisting their return to work at the earliest opportunity. Resultant policy
interventions included employees having to have a conversation with their line manager
as soon as possible regarding the nature of their absence and a standard informal return-
to-work discussion after every occasion of absence. There was also a tightening of
absence recording mechanisms, which are now done electronically. Line managers were
also tasked with taking a more active role in absence management and ‘triggering’ an
‘absence review interview’, a more formal version of the return-to-work interview. The
absence review interviews are triggered if an employee is absent more than twice in
3 months or takes more than 10 consecutive days off. When conducting the absence
review interviews managers have a degree of discretion in considering the personal cir-
cumstances of the employee and aspects such as the Disability Discrimination Act.
Although there were some teething problems with the new policy, especially in terms of
the manner in which line managers applied discretion and some inconsistency in interpre-
tation of the new rules, the policy appears to have been very successful with the company
suggesting that employee absences are now around 8 days per employee.
Derived from IDS (2005a); Simms (2005).
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In sum, organizations are increasingly seeking to adopt more proactive
approaches to absenteeism. In part, this approach can be achieved by inte-
grated absence management approaches which look to address short- and long-
term absences and importantly also recognizes the potential for underlying causes
for absence that may be explicable by broader HRM failings.
AIDS/HIV
AIDS, which stands for Acquired Immune Deficiency Syndrome, was first diag-
nosed in 1981. It is caused by the human immunodeficiency virus (HIV) which
attacks the body’s natural defence system and leaves it open to various infections
and cancers. Worldwide there are now nearly 40 million people with HIV, many of
them in sub-Saharan Africa (MacAskill, 2006). Within North America, Western and
Central Europe the figure stands at 3.5 million (MacAskill, 2006). Currently,
approximately 10 per cent of known HIV-positive individuals have developed
AIDS (ACAS, 2006). Importantly, many people who are HIV positive are well most
of the time, but develop some minor symptoms such as swollen lymph glands. In
this sense HIV infection alone does not affect people’s ability to do their job, at
least until employees develop illnesses that may make them unfit for work. Till
that point there is no reason why someone who is HIV positive cannot continue to
WELFARE, HEALTH AND SAFETY 247
HRM in practice 11.3 Prevention is better
than cure
Manocha (2004) recognises how wellness management seeks to adopt a proactive
approach in creating a healthy organization. It aims to help employees to look and feel
better and to be physically healthy or fit. The emphasis is less on managing employees
when they get sick, but instead seeks to manage healthy employees so they do not get
sick. Such initiatives are likely to be part of a broader package of HRM policies which aim
to create a great place to work. Wellness is likely to be facilitated by aspects such as a gym
on site in the workplace and the provision of expert advice in areas such as nutrition.
Employers adopting a wellness programme are also likely to measure the results of such
an approach by monitoring aspects such as employees’ heart rate, blood pressure, chol-
esterol and body weight.
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work normally as long as they are fit to do so. Moreover a person who is HIV posi-
tive is no real danger to others at work in that transmission during normal work-
ing activities is virtually impossible.
It is difficult to be definitive in terms of identifying the number of people who
may be HIV positive or have AIDS within the workplace. Ladki (1994) notes that
96 per cent of those diagnosed with AIDS in the United States were in their prime
employment years (20–64 years). Similarly, Breuer (1995), again writing in the US
context, suggests that 1 in 300 employees may be HIV positive or have AIDS; and
that 90 per cent of HIV infected Americans are in the workplace. Clearly then
AIDS/HIV is something that organizations have to respond to as a major environ-
mental feature, for example with regard to aspects such as employee education
and understanding the legal implications of how best to respond to employees
who are HIV positive. AIDS then presents a major managerial challenge encom-
passing moral, social and medical issues resulting from health, safety, legal and
humanitarian problems (Arkin, 2005). Consequently, as Bratton and Gold (2003:
172) note, ‘a textbook on human resource management for the next millennium
would be incomplete if no reference were made to society’s most recent menace.’
Indeed, it may well be that these sentiments have a particular resonance
within the tourism and hospitality industry for a number of reasons including
(Adam-Smith and Goss, 1993):
? Age composition and accommodation arrangements: Many organizations within the
sector rely to a great extent on young workers. This is the group in society per-
ceived to be at the most risk of infection through high-risk behaviour, whether that
be drug abuse or unprotected sex. For example, most of those infected with HIV
are in the age groups that have the highest level of economic activity, thus half of
all know infections are in those between the ages of 15–24 years (Goss, 1997). It is
also possible that there is a greater concentration of high-risk behaviour when
many young workers are living together in shared accommodation, or working in
a potentially sexually charged environment (see HRM in practice 11.4).
? Perceived high concentration of homosexual males working in the industry: Despite
research suggesting that this group has now changed their sexual practices there
may be a number who were affected before the risks became apparent.
? The nature of the work in certain sub-sectors, such as working in kitchens and res-
taurants: Here, there may be a very slightly greater risk of infection than in other
workplaces. For example, blood being transmitted through accidents in the
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kitchen or hypodermic needles being found in hotel bedrooms or clubs/discos
and the risk of blood contact through violent encounters.
? Sensitivity to public fears: Despite medical advice to the contrary the public may
feel that there is a significant risk of HIV being transmitted through food and in
the 1990s employers in the American restaurant industry saw AIDS as the num-
ber one long-term issue facing the industry (Ladki, 1994).
Much of the above discussion points to the need for a considered managerial
response. Before we move on to discuss this point further first of all consider the
issues outlined in HRM in practice 11.5.
WELFARE, HEALTH AND SAFETY 249
HRM in practice 11.4 Sexual activity in the
tourism industry
Guerrier and Adib (2004) in their study of tour reps in Mallorca found that male reps in
particular where much more likely to instigate sexual relations with customers. Often
these approaches and liaisons would take place after organized night outs where male
reps were also more than likely than female reps to drink with customers. Guerrier and
Adib recognize that for the male tour reps engaging in this type of behaviour was an
attempt to reinforce their masculine identity, which they suggest is especially important
in feminized environments when it may be in doubt.
HRM in practice 11.5 Responding to sensitive issues
Read the following scenarios:
A member of staff in your travel agency comes to you and informs you that they are HIV
positive. How do you react?
A male cook who works in your restaurant kitchen is quite open about the fact that he
lives in a homosexual relationship. Most of the other people in the kitchen are aware of
this. One day a rumour is started that he is HIV positive. Despite this rumour being untrue
very quickly a number of his colleagues have been to see you to ask for him to be dis-
missed. How do you handle this situation?
Review and reflect: How, as a manager, would you respond to these scenarios?
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Having considered your response to these scenarios now consider HRM in prac-
tice 11.6 which outlines how one organization dealt with a very similar problem.
HRM in practice 11.6 illustrate the need for a clear and sensible approach to
managing AIDS/HIV, though some of the difficulties in developing such an
approach are nicely encapsulated by the view of one manager quoted in Bratton
and Gold (2003: 172) who recognizes that, ‘I was not trained to manage fear, dis-
crimination, and dying in the workplace.’ Much of the discussion above stems
from potential misinformation about the nature of AIDS/HIV and in particular the
notion of perceived risk of infection. Adam-Smith and Goss (1993) identify three
potential responses to the perceived risk of infection in the workplace.
? Rational response: In this response individuals fully understand the probability of
risk and on this basis make an informed choice about the acceptability of working
with somebody who is HIV positive. As we have already noted the risk of trans-
mission in a normal workplace situation is minimal and as long as employees are
aware of this point then their rational response is such that they would have little or
no fear of contracting the disease or working with somebody who is HIV positive.
? Bounded rationality response: In this response individuals are likely to view the
issue on the basis of factually incomplete or incorrect information, often leading
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HRM in practice 11.6 Public misperceptions
about AIDS
Barrows et al. (1996) report how a well-known Californian restaurant, Bon Appetit, found
that its business was seriously affected when news emerged that a former employee had
died of AIDS. Customer counts declined significantly when the media released a story that
an executive chef who had previously worked in the restaurant had died of AIDS. The
owner of the restaurant, Ralph Granthem, chose to take a proactive response to the situ-
ation by holding a press conference, where he recognized the overwhelming medical evi-
dence that suggests that AIDS is not transmitted by food handling. Greater clarity was also
offered by a well-publicised visit from the Director of the California Department of Health
Services. Along with his wife the Director ate in the restaurant and also produced a state-
ment recognizing that people do not get AIDS from restaurants. By taking a proactive
approach the restaurant was able to reverse the decline in business, but the case illustrates
the possibility for uninformed public responses to AIDS.
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to a misunderstanding of the degree of risk. Consequently, employees may
overemphasize the perceived hazard of AIDS/HIV and for example refuse to
work with a fellow employee who is HIV positive because of an inflated sense
of risk.
? Subjective response: This response is largely driven by moral or subjective beliefs
that determine the level of acceptability of working with somebody who is HIV
positive. For example, somebody who is homophobic may see AIDS/HIV as
being a disease that is ‘self-inflicted’ and refuse to work with a homosexual col-
league who is HIV positive.
Adam-Smith and Goss recognize that in reality, ‘individuals are likely to use a com-
plex mix of these decision-making processes in their assessment of risk’ (p. 28).
Furthermore the organizational context will also be important in determining
employees’ assessment of risk, a point we touched on earlier.
Policy responses to AIDS/HIV
To a large extent the discussion above also points to the manner in which organ-
izations can develop a response to the issue of AIDS/HIV, which can take one of
several forms:
? Total denial that AIDS/HIV is a workplace issue.
? Wait and see approach.
? Deliberate no-policy decision and reliance on existing arrangements.
? AIDS/HIV to be treated as any other life-threatening disease.
? Introduce specific policy.
Given much of the discussion above a more proactive response seems appropriate.
In this way the reasons for having a policy include things like countering misun-
derstanding, lack of knowledge, fear and prejudice. Although ostensibly there is
no statutory obligation for such a policy, the designation of HIV under the
Disability Discrimination Act, wherein someone with HIV is deemed to have a dis-
ability, means that organizations should be proactive, particularly with regard to
the notion of making ‘reasonable adjustments’ to address progressively disabling
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conditions. In developing a policy there are a number of aspects organizations can
consider as being integral to a successful policy, including (e.g. see IRS, 1997;
ACAS, 2006):
? Ageneral statement of the company’s commitment to non-discrimination.
? Affirmation of usual hiring procedures so there is no discrimination in recruit-
ment against applicants on the grounds that they are HIV positive or have
AIDS.
? Assurance of continued employment.
? Employees who are HIV positive will be redeployed to alternative employment
at their own request and will not be prevented from continuing work, except
where they are deemed ‘medically unfit’ through the standard procedures.
? Equitable benefits.
? Guarantee of medical confidentiality.
? Access to employee assistance programmes (EAPs), for example counselling
services.
? Astatement that individuals who refuse to work normally with people with AIDS
or who are HIV positive will be interviewed to find out the circumstances of their
refusal and if appropriate dealt with under the organization’s disciplinary proce-
dure.
? Arrangements for staff who travel overseas.
Apolicy such as that suggested above may also be developed in conjunction with an
education programme to ensure that all employees are fully aware of AIDS/HIV
and particularly the lack of any real risk in normal workplace situations.
Alcohol/drug misuse
Drink- and drug-related problems are one of the commonest causes of sickness
absence in the workplace. Figures suggest that in the UK one in three men and one
in five women drink over the recommended limits (IDS, 2005b) with 1 in 13 Britons
said to be dependent on alcohol (BBC, 2003). The result is that for those drinking
over the recommended number of units (21–28 for men; 14–21 for women) are
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twice as likely to take sick leave (IDS, 2005b). It is estimated that alcohol-related
sickness or illness costs UK employers around £6.4 billion, with up to 17.4 million
working days lost in 2003 (Roberts, 2003). Moreover research from Alcohol
Concern suggests that one in four accidents at work are due to alcohol misuse
(TUC, 2003). Across the EU it is estimated that the cost of lost productivity through
absenteeism, unemployment and lost working years through premature deaths
resulting from alcohol abuse is €59 billion a year (Institute of Alcohol Studies,
2006). Similarly, research in the US has suggested that workplace alcohol use and
impairment affects approximately 15 per cent of the workforce (Alcohol Concern,
2006). Problem drinkers are also absent from work in the US, on average, 22 days
per year and are twice as likely as non-alcohol drinkers to have accidents at work
(Corsun and Young, 1998). Whilst problem drinking is a significant workplace
concern the same is also true for drug misuse. In 2004, a third of British workers
under the age of 25 years took illegal drugs in the previous year, with the figure
being 1 in 10 for all workers (IDS, 2005b). Drug abuse costs British industry around
£800 million a year (Hilpern, 2001). In the US one in four workers either has used
or knows someone who uses illegal drugs and it is suggested that drug abuse costs
US business $60 billion annually (Eade, 1993).
Therefore the direct and indirect of alcohol and drug abuse can be seen in a
number of ways, such as costs of accidents, lower productivity, poor quality work,
bad decisions, damage to the organization’s reputation, absenteeism and unrelia-
bility, managers losing time in dealing with problems and increased labour
turnover. Many argue that alcohol and drug misuse has a particular resonance in
the tourism and hospitality. For example, the industry is often suggested as being
fast paced and having a ‘work hard, play hard’ culture where employees may
unwind with alcohol or drugs. In addition, other factors that create an environ-
ment which arguably encourages alcohol and drug abuse include:
? Long working hours.
? Sociability of the workplace.
? Availability of alcohol in the workplace, and often the expectation that employ-
ees will drink as part of their employment.
? Stress, for example employees having to sustain emotional labour so that even
during stress-inducing encounters with customers, employees are expected to
be positive, friendly, cheerful and helpful.
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Reflecting the above discussion it is unsurprising to find that hospitality and
tourism workers have been identified as particularly at risk with regard to alcohol
and drug abuse. For example, a recent survey of 1000 hospitality professionals
found that 40 per cent of respondents had seen colleagues take illegal drugs while at
work, with 59 per cent noting how they had seen colleagues drinking to excess on
duty (Bignold, 2003). Similarly, publicans top the list of liver cirrhosis mortality with
other hospitality occupations, such as cooks and kitchen porter and caterers not far
behind (Mullen, 2001).
Developing policy on alcohol and drugs
On the question of a policy it is worthwhile initially considering the extent to
which employers can seek to intervene in something that may be taking place out-
side the workplace. As we noted earlier, in developing welfare policies there may
be times when employers are intervening in an employee’s private life outside the
organization. Proponents of the business case for welfare would argue that if an
employee attends work whilst still impaired through the use of alcohol or drugs
then it is likely to significantly affect their performance. Consequently they would
dismiss concerns as to the appropriateness of an employer taking an active inter-
est in an employee’s life outside of work.
Of course, within the workplace the issue is less ambiguous and employers
have a legitimate right to develop policies for alcohol and drug misuse. Afurther
issue which impacts on the development of such a policy is the difference between
alcohol and drugs in that rules on drugs at work are inevitably more stringent
because many drugs are illegal (IDS, 2004a). In terms of developing policy it is use-
ful to acknowledge the view of IDS (2004a: 10) who recognize that, ‘there is an
increasing trend towards treating long-term alcoholism and, to a lesser extent,
dependence on illegal drugs as serious illnesses’. When viewing alcohol and drug
misuse in this light the organization is likely to be supportive rather than punitive
and will encourage an employee who has a drink or drug problem to seek volun-
tary help, although this may be facilitated by establishing links with outside
organizations, such as those providing EAPs, who can provide expert advice and
support. That said, even supportive policies will also usually contain provision for
a more punitive approach if there is no improvement in the employee, for example
an employee may face disciplinary action and ultimately dismissal on the grounds
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of capability. Furthermore, IDS (2004a) also note that there may be circumstances
where an employee recklessly or even deliberately disregards company rules or
acceptable standards of conduct on alcohol and drugs where dismissal on the
grounds of misconduct may be acceptable. Within this context then an organiza-
tion’s alcohol and drug policy may contain the following (IDS, 2004a):
? Ageneral statement covering the background to the policy, including any legal
obligations.
? A clear outline of the aims and purposes of the policy, including the balance
between the discipline and support for employees.
? Details of the responsibilities of different staff and the training and guidance
available.
? Who is covered by the policy and if there are tighter restrictions for any par-
ticular groups.
? Rules and procedures around drug use, including definitions of what consti-
tutes alcohol and drug misuse and rules regarding prescription medicine.
? The disciplinary action that will be invoked following a policy breach, and what
the company’s stance is regards to misconduct relating to alcohol or drugs, but
not dependency.
? Information for employees on safe drinking limits, classes of drugs, the effects
of alcohol and drugs, and where to receive help.
? Details of how an employee can refer themselves for treatment, the support the
company will offer and what action the company will take if treatment is
declined, not completed or the employee relapses.
? Overview of any testing process, including an explanation of why tests are car-
ried out and when, who administers the tests and what happens if a test proves
positive or an employee admits to a dependency during the testing process (see
HRM in practice 11.7).
Review and reflect
To what extent do you agree that ‘peer pressure’ is likely to have more impact on changing
behaviour with regards to alcohol or drugs than organizationally directed interventions?
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Sexual harassment
Whilst definitions of sexual harassment are generally similar there may still be dif-
ferent perceptions as to what constitutes sexual harassment (see, for example, ILO
(1999) for a review of practices across a number of companies and countries).
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HRM in practice 11.7 Drug and alcohol testing:
An ethical or legal issue?
There are debates about the usefulness of drug and alcohol testing in the workplace,
with concerns being expressed about the moral, ethical and legal aspects of testing; and
particularly whether testing is the best way to address the problem of misuse. For example,
within the European context some argue that under the Human Rights Act 1998 random
testing impinges on an individual’s right to privacy. Where testing does take place there
are significant differences on who is likely to be tested, depending on aspects such as the
country and sectoral context. In the US it is suggested that around 70 per cent of com-
panies across all industries screen employees for illegal substances. More specifically,
research conducted in the 1990s in the hotel sector found that nearly 50 per cent of a
sample of 110 hotels conducted drug testing both for applicants for jobs and existing
employees. In the UK, the figure is much lower with some estimates suggesting it is as
low as 4 per cent. As well as the national differences there may also be differences in
terms of occupations. For example, jobs in industries which are considered ‘safety criti-
cal’ are much more likely to have testing on the job, this would include some parts of the
tourism industry, such as the airline industry. The British Airline Pilots Association
(BALPA), a trade union representing around 8000 pilots and cabin crew, have voiced con-
cerns about random testing of pilots, suggesting that this approach merely drives the
problem underground. Instead, their solution to alcohol and drug misuse is support via
‘peer pressure’. In this approach flight crew are encouraged to confront a colleague with
a problem and urge them to seek help. Evidence seems to suggest that this approach is
more successful in detecting the problem and helping individuals deal with it and has
recently been endorsed by the International Federation of Airline Pilots Association,
which represents pilots worldwide. The ferry and cruise ship industries also tends to
operate a strict ‘no-alcohol at work’ policy for both sea- and shore-based employees, and
will often randomly test on-board employees for alcohol or drugs.
Derived from Casado (1997); IRS (2002); Shanahan (2005).
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Before we move on to consider the substance of this statement first of all consider
HRM in practice 11.8.
In 2002, the Council of Ministers and European Parliament agreed the text on
a new directive on the equal treatment of women and men, which included a new
definition of sexual harassment. As of 1st October 2005 this new European wide
definition was introduced into law and suggests that sexual harassment is ‘any
form of unwanted verbal, non-verbal or physical conduct of a sexual nature
(which) occurs with the purpose of violating the dignity of a person, in particular
when creating an intimidating, hostile, degrading, humiliating or offensive envir-
onment’ (cited in LRD, 2005a: 21). Sexual harassment therefore is unwanted
behaviour which a person finds intimidating, upsetting, embarrassing, humiliat-
ing or offensive and in that sense is unique to the individual. The individual
nature of sexual harassment means that, at certain times, it may be rather sub-
jective and behaviour that one person may consider as acceptable could be seen as
harassment by another. For example, you may have indicated all of the aspects in
HRM in practice 11.8 as denoting sexual harassment, yet the next person might
have indicated something different. There is also the added complication that
increasingly many of us now meet our partners in the workplace, which means
that romantic conduct or romantic liaisons are increasingly evident in the work-
place. For example, according to IRS (2000), whilst the majority of UK employees
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HRM in practice 11.8 What constitutes sexual
harassment?
Consider the following list/scenarios and place a tick by what you would consider sexual
harassment:
Patting, hugging or touching a co-worker.
Comments about the way a women looks.
Lewd remarks or glances directed towards a male employee from a female employee.
Questions about an employees sex life.
Requests for sexual favours.
Allowing suggestive posters of either sex in the workplace.
Intimate physical contact within the workplace.
A manager begins a sexual relationship with one of his/her subordinates.
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disapproved of overt sexual activity in the workplace, the majority of survey
respondents were comfortable with flirting and almost 40 per cent were or had
been involved in workplace romantic or sexual relationships. This estimate is cau-
tious given that such relationships are often deliberately covert but is also con-
firmed by Kakabadse and Kakabadse’s (2004) recent international study of
romance in the workplace. With the workplace ‘becoming a common meeting
ground for romantic liaisons’ (Kakabadse and Kakabadse, 2004: 42) there is a need
to recognize the line between legitimate and accepted behaviour and that con-
sidered sexually harassing.
Where behaviour does err on the side of unacceptable it is usually women
who are worst affected by sexual harassment, although men can suffer as well.
Equally, there may be occasional cases of same sex harassment (Sherwyn et al.,
2000). Generally, though it is women who experience sexual harassment. For
example, the Industrial Society (now Work Foundation) produced a report in the
mid-1990s which suggested that 93 per cent of sufferers of sexual harassment were
women (Coupe and Johnson, 1999). Often it is a male superior who is the harasser.
Gilbert et al. (1998) note how two-thirds of sexual harassment complaints in the
largest companies in the US were made against immediate supervisors and upper
management. Moreover the extent to which sexual harassment is experienced is
widespread. IRS (1996), for example, reporting their own and other survey data
suggests that well over 50 per cent of women had suffered harassment at work.
More specifically, Worsfold and McCann (2000) reporting on the experience of 274
students on supervised work experience in the hospitality industry found that 156
(57 per cent) had experienced instances of sexual harassment.
Despite the fact that it is often viewed as a ‘joke’, ‘just a bit of fun’ or ‘a bit of
harmless flirting’, sexual harassment is, in reality, usually about the misuse of
power as well as being humiliating and degrading for the recipient and therefore
likely to effect confidence and job performance. It can also have a serious impact
on physical and mental health and lead to absenteeism. Clearly, then there are sev-
eral reasons why employers should take action to prevent sexual harassment.
Some of these may be pragmatic, such as protecting the company image and
avoiding litigation as the courts increasingly view the prevention of harassment as
the responsibility of the employer; some may be concerned with business aspects
such as reducing absenteeism. Arguably though the strongest argument lies in our
earlier identification of the ethical dimension of broader welfare policies. No
employee should have to suffer sexual harassment and the workplace should be
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a place where every employee has the right to be treated with dignity and not suf-
fer from harassing behaviour (ILO, 1999).
Tourism and hospitality: a breeding ground for sexual harassment?
It is important to realize that sexual harassment may be particularly prevalent in
the tourism and hospitality industry. For example, Coupe and Johnson (1999: 37)
note that, ‘Female employees within traditional service spheres of employment,
such as operative employees in the hospitality industry, will be extremely vulner-
able to sexual harassment’. Why is this the case? First, within the hospitality sub-
sector in particular there is the notion of many departments often being dominated
by a single gender, for example men in the kitchen (see HRM in practice 11.9).
A further issue is the extent to which tourism and hospitality organizations
may either tacitly or even deliberately exploit women’s sexuality. As Gilbert et al.
(1998: 49) note ‘the inherent characteristics of service organizations create a prime
breeding ground for sexual harassment’. Within tourism and hospitality many
accounts (e.g. Hall, 1993; Adkins, 1995; Tyler and Abbott, 1998) recognize the man-
ner in which some organizations may sanction sexuality as part of the performa-
tive aspects of their front-line employees. In this way tourism and hospitality
workplaces may be in Mano and Gabriel’s (2006) view ‘hot’ climates. Workplaces
which are considered ‘hot’ climates often have a high degree of aestheticization of the
WELFARE, HEALTH AND SAFETY 259
HRM in practice 11.9 If you can’t stand
the heat…
The kitchen is often felt to be a very masculine environment with a very macho culture,
which may lead to sexist attitudes being prevalent. It is suggested that to fit in employees
may have to swear, ogle pornography and generally act like men. Such an environment can
create attitudes where sexually harassing behaviour could be construed as just a ‘bit of a
laugh’. One female chef reporting on her experiences working in a kitchen notes several
incidences of sexual harassment, including a colleague having her trousers pulled down in
front of an all-male kitchen. She also notes the experiences of female chefs in the US where
sexism seems equally prevalent, for example one noting how she was routinely groped.
Derived from Packer (1998); Roche (2004).
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workplace which emphasizes the importance of appearance, style and sensuousness,
which in turn creates what Mano and Gabriel term a ‘sexual simmer’. Workplaces
which have this sexual simmer are also likely to encourage flirtation, sexualized lan-
guage, innuendo and an emphasis on appearance and image. This notion of certain
service workplaces being inherently sexualized is supported by Guerrier and Adib
(2000). In their study of sexual harassment of hotel workers they suggest a contribut-
ing factor is that hotels often suggest the promise of sexual activity:
The space of the hotel is laden with sexuality. In particular, the hotel’s func-
tion is sexualized. Hotel bedrooms provide a space for guests to engage in
sexual activity. The sexualization of the hotel space is reflected in the sexual-
ization of hotel workers. In many of the incidents of harassment in this study,
assumptions were made about the hotel workers and their roles as service
providers within a sexualized setting (p. 720).
Beyond the hotel sub-sector, Guerrier and Adib (2000, 2004) also note how other
tourism- and hospitality-related setting such as restaurants, airlines and working
in a resort as a tour rep are also inherently sexualized environments (see HRM in
practice 11.10).
As can be seen from the above discussion it is women who are more likely to
face sexualization and potentially sexual harassment. Adkins (1995) is one of sev-
eral authors who recognize how female employees have greater pressure from
tourism and hospitality organizations to sustain an ‘attractive’ or alluring appear-
ance. She reports how managers in the leisure organization she studied would
enforce uniform requirements which required that women would have their
dresses pulled down off the shoulder. Indeed, she even notes how male managers
would often physically pull down employees’ dresses into that position. In this
way potentially neutral dress and appearance standards are sexualized by man-
agerial action. Organizations may also encourage a degree of flirting in the inter-
action with customers and crucially alcohol consumption, indeed often excessive
consumption, is an integral part of many tourism and hospitality workplaces, fre-
quently loosening the tongues and morals of customers in particular. For example,
Hall (1993) notes the importance of ‘job flirt’ to the waiting staff she studied.
Taking part in such activities could potentially be gender neutral in that both men
and women might conceivably engage in this type of behaviour in the work setting.
Guerrier and Adib (2000) note how the restaurant chain TGI Fridays encourages both
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male and female waiters to flirt with customers to increase customer spend and their
own tips. Nevertheless, Hall (1993: 465) notes how, ‘although playing the flirting
game is an accepted part of interacting with customers, waitresses are more likely
than waiters to be the subject of sexual approaches’ (see HRM in practice 11.11).
What the above discussion points to is that within tourism and hospitality there
is not only the potential for sexual harassment in terms of the superior/subordinate
relationship, but also via potentially pernicious customer interactions. The latter
aspect in particular is one where some tourism and hospitality organizations may
allow for a certain amount of ambiguity to creep in. For example, in Loe’s (1996)
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HRM in practice 11.10 Skilled professional
or ‘trolley dolly’?
Historically the process of sexualization of airline cabin crew has been one which has
changed over time. At the outset of the airline industry flying was an all-male preserve,
including the job of air steward. Though there was a limited experimentation with the
recruitment of female air stewards in the 1930s it was not until the mid-1940s that the
job was really feminized. In the 1950s and 1960s airlines began to sexualize their stew-
ardesses, mainly through their advertising and marketing by portraying the ‘sexy’ image
of female cabin crew. Sexually suggestive advertising slogans used in the past have
included Delta’s ‘Ready when you are’, National’s ‘I’m Anne, fly me’ and Continental’s
‘We really move our tail for you’. This portrayal of what have often been described as
‘trolley dollies’ was one which seemingly became increasingly anachronistic as airlines were
accused of sex discrimination and sexism, especially by the trade unions representing
stewardesses. By the mid-to-late 1970s the selling of overt sexuality seemed to wane.
However, a recent review of aesthetic labour in the airline industry offers evidence as to
how some airlines still seem to mobilize their employees’ physical disposition to move
beyond an aesthetic appeal to one where the appeal seems to be to the sexual desires of
customers. The examples cited are Virgin Blue and Air Asia, two new airlines operating
in the low-cost carrier market. An examination of the advertizing and marketing of these
two airlines points to the manner in which female employees are sexualized, particularly
in Virgin Blue, which was described in one newspaper as the world’s sexiest airline. For
example, one advert produced by the company featured smiling, attractive and youthful
flight attendants and was captioned ‘Plane Fares, Beautiful Service’.
Derived from Mills (1996); Spiess and Waring (2005).
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thinly disguised ethnographic study of ‘Bazooms’, she notes how new employees
had to sign the official Bazooms sexual harassment policy, which states that ‘In a
work atmosphere based upon sex appeal, joking and innuendo are commonplace’
(p. 400). Of course, there is potentially a thin line between innuendo and what may
be thought of as harassing behaviour. Such an issue seemed less of a concern for
the company and the Bazooms employee handbook described sexual harassment
in the following manner:
Sexual harassment does not refer to occasional compliments of a socially
acceptable nature. It does not refer to mutually acceptable joking or teasing.
It refers to behaviour which is unwelcome, that is personally offensive, that
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HRM in practice 11.11 Hooters: An acceptable
form of sexualization?
Although selling itself as ‘a family restaurant’ (though 70 per cent of customers are
men aged 25–54 years) the Hooters company uniform of short shorts, and a choice of
either a tight tank top, crop or tight T-shirt suggests that the intent of the company is to
project an image of sexy, eager waitresses. Golding (1998: 7) notes how the company
‘unashamedly uses nubile young waitresses dressed in skimpy tops to attract customers’ –
the so-called ‘Hooters Girls’. The success of the company is such that they now have over
400 restaurants in the US as well as a presence in 19 other countries. Additionally, until
recently the company also had an airline, Hooters Air, which in addition to the airline
crew also featured two Hooters Girls on each flight. A recent case study of Hooters in
Fortune recognizes the extent to which Hooters is considered a mainstream business suc-
cess (Helyar, 2003). Indeed, the company’s marketing and branding strategy has survived
a challenge in the American courts on the basis that the company brand is ‘female sex
appeal’ (Prewitt, 2003). It is also interesting to note the reaction of the then editor of
Caterer and Hotelkeeper to the arrival of the first Hooters restaurant in the UK. In an
opinion piece the editor saw little to worry about in the emergence of Hooters. In answer
to his own question of whether ‘the moralists and protectors of womens’ rights [are]
being distracted by a bit of harmless fun?’, he goes on to suggest that: ‘Blatant titillation has
become widely accepted in the selling of countless commodities, from fast cars to chocolate
bars, from drinks to holidays … If we are not offended by this, then we shouldn’t get upset
about Hooters, because the principle is much the same’ (Mutch, 1998: 23).
Review and reflect: To what extent do you agree with the sentiment of Mutch?
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debilitates morale, and that, therefore, interferes with work effectiveness
(quoted in Loe, 1996: 412).
Whilst ultimately the manner in which some tourism and hospitality organizations
portray a certain ‘style’ may be one which is debated in terms of the extent to which
it encourages customers to engage in unacceptable behaviour, the key point remains
that sexually harassing behaviour can have a significantly harmful impact on
employees. Consequently, it is important that the organization develops a suitable
policy response.
Developing policy for sexual harassment
Therefore as a way of preventing sexual harassment organizations should imple-
ment an effective policy, which should aim to (CIPD, 2006b):
? Set out what is considered to be inappropriate behaviour, as well as defining
positive and supporting behaviours.
? Explain the damaging effects and why it will not be tolerated.
? Affirm that sexual harassment will be treated as a disciplinary offence with
appropriate penalties attached.
? Explain complaints procedure, including how to get help and make a com-
plaint, formally and informally.
? Affirm that the complaint will be treated seriously, speedily and confidentially
and that there will be no victimization for making a complaint.
? Make it a duty for supervisors/managers to implement policy and ensure it is
understood.
By offering a clear policy employees who are being sexually harassed can feel con-
fident that the issue will be taken seriously. This point is important as in bringing
forward a complaint of sexual harassment the employee should not have to fear
reprisals or continued harassment or equally be worried about things like risking
future promotion opportunities. Once a complaint is made the investigation
should begin as soon as possible and provide (CIPD, 2006b):
? Aprompt, thorough and impartial response.
? Independent, skilled and objective investigators.
? Representation for both parties.
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? Complaint details, the right to respond and adequate time to respond.
? Atime scale for resolving the problem.
? Confidentiality for all parties.
Investigations of sexual harassment may either be by formal or informal means,
though often the preference will be for an informal resolution (IDS, 2003). If though
there is a more formal investigation, depending on the outcome of any investiga-
tion there may be a range of potential decisions. For example, if the harassment is
sufficiently serious it could lead to the dismissal of the perpetrator. Alternatively,
there may be disciplinary action short of dismissal, counselling for the person
whose behaviour is unacceptable and often the perpetrator may be transferred.
There may be occasions where individuals are unclear how their behaviour may be
seen as harassing and ensuring that they are aware of acceptable and unacceptable
behaviour at work will prevent ambiguity and stop harassment reoccurring.
Smoking
In a recent review of smoking in the restaurant industry, Nickson (2000) noted that
much of the work in this area could be distilled into two broad themes:
? The responsibility of the employer to maintain a safe environment for employ-
ees and customers.
? The necessity of satisfying the needs of all consumers (i.e. smokers and non-
smokers) to remain profitable.
From a health and welfare perspective most of the concerns about smoking in the
workplace are linked to the phenomenon of environmental tobacco smoke, or as it
is rather more popularly known, passive smoking. In the past many tourism and
hospitality workplaces, such as restaurants and pubs, would be considered as
being a relatively smoky atmosphere, and consequently possibly more damaging
to employee health. The issue of passive smoking has been at the centre of an
intense debate between pro- and anti-smoking groups, with each side contesting
the validity of each other’s statistics. Increasingly though it appears that those
against passive smoking are winning the argument as a number of countries have
now moved to banning smoking in public places, including pubs, hotels and
restaurants (see HRM in practice 11.12).
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WELFARE, HEALTH AND SAFETY 265
HRM in practice 11.12 A global curb on smoking
Australia: Smoking is banned in all airports, government offices, health clinics and work-
places in Australia. Restaurants in most states and territories are also smoke free zones.
France: Attempted to cut smoking levels by raising the price of cigarettes by 20 per cent
in October 2003. Despite this price hike it was reported that there was no noticeable dif-
ference in Paris’ traditionally smoke-filled cafes and bars.
Italy: Imposed a ban on smoking in all enclosed public places including bars and restaur-
ants in 2005. The ban has not been welcomed by all, with some bar owners and
smokers saying they will ignore the ban on the grounds that cigarettes and smoking are
an integral part of Italian bar and cafe culture. The new rules allow smoking in special
sealed-off areas fitted with smoke extractors; however many bar owners say fitting the
automatic doors and forced ventilation systems required by law is too expensive.
The Netherlands: A tough crackdown on smoking from 1 January 2004 saw cigarettes
banned from many public places including railway stations, trains, toilets and offices.
Hotels, bars and restaurants are likely to face a ban from 2009. Some 30 per cent of the
Netherlands’ 16 million population are smokers – a higher rate than all other EU countries
except Spain, Greece and Germany.
Norway: A national ban was imposed on smoking in restaurants, bars and cafes from
June 2004. The government says the ban is to protect staff working in these establish-
ments from passive smoking and to ‘de-normalize’ smoking as a social pastime.
Spain: Smoking was banned in offices, shops, schools, hospitals, cultural centres and on
public transport from 1 January 2006. The government says the ban is necessary because
smoking is the biggest killer in Spain, with 50 000 smoking-related deaths annually.
Sweden: Smoking was prohibited in all bars and restaurants from May 2005. Establishments
wanting to allow smoking are required to have a closed-off section with specially
designed ventilation, where no food or drink can be served. Most venues were not
expected to be able to afford such renovations. The ban followed lobbying by the coun-
try’s licensing sector which said bar and restaurant staff were more likely to suffer lung
cancer than in any other profession.
United States: Many cities and states enforce bans on smoking. California has some of the
toughest and most extensive anti-smoking legislation anywhere in the world. Smoking is
also banned in restaurants, bars and enclosed workplaces – and on beaches – through-
out the state. In New York, smoking has been banned in bars, clubs and restaurants since
March 2003.
Derived from BBC (2005).
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At the time of writing within the UK the picture is currently mixed. Within
Scotland the introduction of the Smoking, Health and Social Care (Scotland) Act
2005 led in 2006 to the banning of smoking in public places, including restaurants,
bars and pubs. In a similar vein legislation will lead to a smoking ban in England
from summer 2007. It is suggested that creating healthier workplaces lies at the
heart of the legislation and ultimately the development of smoking bans marks a
significant intervention by government to improve occupational health.
Stress
Stress has increasingly become a major issue in the workplace with a seemingly ever
larger part of the workforce suffering from work-related stress. Indeed, CIPD (2005b)
note how the Health and Safety Executive (HSE) have indicated that stress is likely
become the most dangerous risk to businesses in the twenty-first century. In simple
terms stress is the adverse reaction people have to excessive demands or pressure
when trying to cope with tasks and responsibilities in the workplace (LRD, 2006a). At
one level, stress is a normal part of everyday life and within the workplace many
writers talk about so-called ‘good’ stress, or ‘eustress’. This optimum level of stress is
felt to be important to sustain high performance and will of course vary with indi-
viduals. Once an employee feels unable to cope or control the pressure then they will
experience stress as ‘distress’, which will lead to declining performance. The most
recent research conducted by the HSE indicates that over half a million workers in the
UK were suffering from work-related stress, depression or anxiety caused or made
worse by their current or past work. As a consequence it is estimated that there were
12.8 million lost working days due to work-related stress in 2004–2005 (LRD, 2006a).
European-wide research has suggested that over 40 million EU workers are affected
with work-related stress, with the European Commission suggesting that the ‘con-
servative’ estimate of the cost of this stress being €20 billion (£16 billion) (LRD, 2002).
Review and reflect
Think about what makes you stressed at work and how you can address this. To what
extent is your stress at work alleviated by the organization and its work processes and to
what extent by your own initiative? Where should the responsibility lie, with the organ-
ization or the individual?
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As with a number of other aspects discussed in this chapter organizational responses
to stress are likely to reflect both legal and business arguments. From a legal point of
view employers have a general duty of care under section 2 of the Health and Safety
at Work Act (HASWA) 1974 to ensure the health, safety and welfare at work of all of
their employees and this includes their mental health. In addition, there is also
European-inspired regulation and Regulation 3 of the Management of Health and
Safety at Work Regulations 1999 requires employers to undertake risk assessment in
order to minimize the hazards facing staff, including ensuring that employees health
is not placed at risk by excessive and sustained levels of stress. Failure to comply with
the duties contained in the HASWA and the Management of Health and Safety at
Work Regulations may result in significant compensation being paid by employers.
For example, a number of recent court and out of court settlements in the UK have
seen figures of up to £300000 paid by employers (LRD, 2002). From a business point
of view Figure 11.1 outlines a number of possible negative effects of stress, which will
have a deleterious impact physiologically and psychologically on individuals, which
in turn is likely to significantly hamper organizational performance.
WELFARE, HEALTH AND SAFETY 267
Anxiety Impaired job performance
Alcohol abuse Increased absenteeism
Drug abuse Decreased commitment and motivation
Job dissatisfaction
Depression
Higher turnover rates
Higher accident rates
Lower productivity
Lower morale
Damaged reputation
Panic attacks
Irritability
Low self-esteem
Disturbed sleeping patterns Recruitment problems
Poor concentration
Frequent headaches
Gastric and intestinal problems
High blood pressure
Heart disease
Adapted from IDS (2004a)
Individual Organizational
Figure 11.1 Some negative effects of stress for the individual and organization.
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As we noted above there is a need for organizations to be proactive in recog-
nizing and responding to potential stressors in the workplace. The HSE has sought
to develop a management standard which classifies some of the key areas which,
if mismanaged, can become workplace stressors, these are (HSE, 2005):
Demands – including issues like workload, work patterns and the work envir-
onment. The standard expects that employees are able to cope with the demands
of their jobs. To achieve the standard the organization should provide employees
with adequate and achievable demands in relation to the agreed hours of work;
ensure that people’s skills and abilities are matched to the job demands; that jobs
are designed to be within the capabilities of employees; and that any employee
concerns about their work environment are addressed.
Control – is primarily concerned with how much say the person has in the way
they do their work. The standard suggests that employees are able to have a say
about the way they do their work. To achieve the standard the organization should
aim where possible to ensure that employees have control over their pace of work;
that employees are encouraged to use their skills and initiative to do their work;
that employees are encouraged to develop new skills to help them undertake new
and challenging pieces of work; the organization encourages employees to develop
their skills; employees have a say over when breaks can be taken and employees are
consulted over their work patterns.
Support – includes the encouragement, sponsorship and resources provided
by the organization, line management and colleagues. The standard suggests that
employees should receive adequate information and support from their col-
leagues and superiors. To achieve the standard, the organization should have pol-
icies and procedures to adequately support employees; that systems are in place to
enable and encourage managers to support their staff; that systems are in place to
enable and encourage employees to support their colleagues; that employees
know what support is available and how and when to access it; employees know
how to access the required resources to do their job and employees receive regular
and constructive feedback.
Relationships – includes promoting positive working to avoid conflict and
dealing with unacceptable behaviour. The standard expects that employees
should not be subjected to unacceptable behaviours (e.g. bullying and harass-
ment) at work. To achieve the standard, the organization should promote positive
behaviours at work to avoid conflict and ensure fairness; employees share infor-
mation relevant to their work; the organization has agreed policies and procedures
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to prevent or resolve unacceptable behaviour; that systems are in place to enable
and encourage managers to deal with unacceptable behaviour and that systems
are in place to enable and encourage employees to report unacceptable behaviour.
Role – includes whether people understand their role within the organization
and whether the organization ensures that the person does not have conflicting
roles. The standard expects that employees understand their role and responsibil-
ities. To achieve the standard, the organization should ensure that, as far as pos-
sible, the different requirements it places upon employees are compatible; the
organization provides information to enable employees to understand their role
and responsibilities; the organization ensures that, as far as possible, the require-
ments it places upon employees are clear and systems are in place to enable
employees to raise concerns about any uncertainties or conflicts they have in their
role and responsibilities.
Change – includes how organizational change (large or small) is managed and
communicated in the organization. The standard expects that the organization will
frequently engage with employees when undergoing an organizational change. To
achieve the standard the organization should provide employees with timely
information to enable them to understand the reasons for proposed changes; the
organization ensures adequate employee consultation on changes and provides
opportunities for employees to influence proposals; employees are aware of the
probable impact of any changes to their jobs. If necessary, employees are given
training to support any changes in their jobs; employees are aware of timetables
for changes; employees have access to relevant support during changes.
Anumber of the above aspects can be seen in research examining stress in the
tourism sector. Ineson et al. (2001) conducted in-depth interviews with 10 UK tour
managers and identified 117 critical incidents that induced stress. These aspects
were grouped into four categories relating to colleagues, clients, nature of the job
and poor management. For example, with regard to the nature of the job the particu-
lar work environment of tour managers means that they may face situations such
as medical emergencies or logistical problems such as breakdowns and getting
stuck in traffic jams. Similarly, a number of the tour managers recalled instances
where clients had questioned and contradicted their commentaries, which had
undermined their professional authority as they appeared to be incompetent.
Interestingly though the most common source of stress was employer/management-
induced stress. Examples of such stress included lack of training from the
employer and a lack of management communication and support. Similar results
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were also apparent in Law et al.’s (1995) study of 102 front line staff from 14
Australian tourist attractions. Again, poor management was the reason mentioned
most often by respondents as a source of stress. A number of the other stressors
tended to revolve around the interactions with customers, such as difficulties in
controlling crowds. While it might seem self-evident that difficult customers are
an occupational hazard for tourism and hospitality employees there is a need to
ensure that they are properly trained to deal with such situations. This and other
aspects are clearly reliant on proactive management and in considering workplace
stressors it is clear that there is significant responsibility on employers and man-
agers to address these issues in a proactive manner, including developing a stress
policy.
Developing policy
IDS (2004b) recognize the importance of having a stress policy in bringing the sub-
ject out into the open, ensuring that stress is not seen as a taboo subject and
employees do not feel stigmatized for feeling ‘stressed’. They also recognize that a
standard stress policy is likely to have the following aspects:
? Adefinition of stress.
? Adescription of the symptoms of stress and stress-related illnesses.
? An outline of the organization’s responsibilities for managing stress.
? An outline of managers’ and employees’ responsibilities for managing stress.
? Alist of both internal and external sources of help for stress-related issues (see
HRM in practice 11.13).
Working time
Excessive working time has often been linked to stress (LRD, 2006a) and clearly
is deleterious to a healthy work-life balance. Estimates suggest that around
11 per cent of UK employees currently work more than 48 hours a week, this
figure is the highest in the EU, creating concerns about ‘burn out’ (LRD, 2006b).
Additionally, the UK tops the European hours league with a usual working week
of 42.7 hours, compared to an EU average of 41 hours (LRD, 2006b). Interestingly
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though compared to non-EU countries, the UK has shorter working hours than
Australia, Japan and the US (CIPD, 2006c). Many would argue that debates about
long working hours are particularly pertinent to tourism and hospitality. The long
hours culture in the industry means that many employees work excessive hours,
which is likely to have a harmful impact on their health. Arecent survey of nearly
700 hotel, restaurant and bar employees reported in Caterer and Hotelkeeper (9th
June 2005, ‘Long working hours the norm’) found that 93 per cent worked more
than 40 hours, with nearly a fifth (17 per cent) working more than 60 hours a week.
The same is also very much true for managers and operators of small business,
with a survey of 1400 small hospitality businesses finding that 46 per cent of pub-
licans, 43 per cent of hoteliers and 13 per cent of restaurateurs worked more than
70 hours a week (Cushing, 2004).
The continuing prevalence of excessive working time for many tourism and
hospitality employees may seem surprising given the introduction of the Working
Time Regulations (WTR) in 1998. The introduction of the WTR in the UK was not
without controversy. The WTR were initially introduced as a health and safety
measure. Despite this, the government of John Major sought to challenge the legal-
ity of the measure via the European Court of Justice (ECJ), but eventually lost the
WELFARE, HEALTH AND SAFETY 271
HRM in practice 11.13 EAPs: Helping employees
in the workplace
EAPs are external help services provided by employers which aim to assist in the identifi-
cation and resolution of employee concerns that affect performance. EAPs originated in
the US and remain popular there, with over 85 per cent of the largest Fortune 500 com-
panies using their services. Outside the US the uptake is rather patchier. In Europe EAPs
are rarely used, though there is evidence that more UK employers are using their services,
which now cover around 15 per cent of employees. EAPs typically provide a 24-hour, 365
days-a-year telephone counselling service for employees on issues such as stress, bullying,
violence, and drug and alcohol misuse. A recent decision in the Court of Appeal on work-
related stress has given EAPs a significant boost. The ruling from the Court of Appeal sug-
gested that the provision of EAP provision to address stress pointed to a proactive
employer response and consequently employers who use such services are less likely to be
found to be in breach of the duty of care expected in health and safety legislation.
Source: LRD (2003a).
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case in November 1996, as the ECJ ruled that working hours were a health and
safety issues as opposed to a more general social issue. As a result the UK govern-
ment eventually introduced the WTR into law in October 1998 and the main pro-
visions are (CIPD, 2006c):
? Amaximum working week of not more than 48 hours a week, including over-
time, normally calculated over a rolling 17-week period.
? Employees are entitled to a daily rest period of 11 hours.
? Night workers are limited to an average of 8 hours work in 24 hours.
? Employees are entitled to 4 weeks paid holiday.
? Where the working day is longer than 6 hours, workers will be entitled to a rest
break of 20 minutes.
? In each 7-day period, workers will be entitled to 1 day’s rest, in addition to the
above 11-hour period set out above.
? Free health assessments must be made available to night workers.
When they were first introduced it was felt that the WTR would have a significant
impact on UK organizations. In particular, the extension of paid annual leave to
the UK, the only EU country not to previously have a legal right to paid holidays,
affected around 2.5 million workers, mostly part-timers and women. Moreover
just over four million workers had less than 3 weeks leave and six million less than
4 weeks leave (Milne, 1998). In reality though the impact of the WTR has proved to
be less than thought, in part because of a series of derogations which the UK gov-
ernment negotiated (Hurrell, 2005). Chief among these is the ability of companies
to offer an ‘opt-out’ where employees sign away their right to a 48-hour limit on
their working week. This measure is one which has been adopted by a large num-
ber of tourism and hospitality employers. Although the European Commission
has recently sought to restrict the UK’s right to offer an opt-out clause, at the time
of writing the UK government seems determined to retain the opt-out (LRD,
2006b). Finally, even the provision of paid leave is far from straightforward. Due to
the WTR never specifying whether public and bank holidays would be included in
the 20-day calculation some employers have taken advantage of this loophole and
have used bank holidays in calculating their employees’ holiday entitlement.
Resultantly, around 3.4 million employees have not been getting 20 days min-
imum paid leave a year, with around one million of these employees being in the
leisure and retail industries (LRD, 2005b). More recently it appears that this loophole
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is now likely to be closed with the Government announcing plans to rectify this
anomaly (LRD, 2006c).
Workplace violence
Tourism and hospitality establishments rank high on the list of workplaces with
high incidences of violence. LRD (2003b) reports evidence from the British Crime
Survey on the number of workers reporting assaults or threats which occurred
while the victim was working and were perpetrated by a member of the public.
Across all occupations the percentage of workers who faced violence was just
1.2 per cent. However, for leisure service providers the figure rises to 3.7 per cent
and for publicans and bar staff it rises significantly to 11.5 per cent. Boyd (2002) in
a survey of nearly 1200 employees in the airline and railway industries also found
that 70 per cent of her respondents reported an increase in the number of abusive
passengers over the previous year. Such abuse was both verbal with 74 per cent of
respondents experiencing verbal abuse from passengers at least once a month.
More worryingly still, nearly 40 per cent of her respondents had experienced at
least two types of physical abuse and 26 per cent had experienced at least three
types of physical abuse. Instances of such abuse included being pushed, punched,
kicked, slapped, struck with an object and spat at.
These relatively high figures reflect the fact that many employees in the
tourism and hospitality sector have to deal with members of the public, exchange
or collect money, work at night and work alone, or in small numbers. Added to
these aspects many workplaces in tourism and hospitality involve the consump-
tion of alcohol, often to excess. Certainly, alcohol seems to have a catalytic effect in
many instances of workplace violence in tourism and hospitality. Morgan and
Nickson (2001) in a review of ‘air rage’ in the airline industry found that excessive
alcohol consumption was by far the most commonly cited contributory factor to
passenger violence or aggression. Other reasons included being deprived of nico-
tine and the inherently stressful nature of flying.
Workplace violence is undoubtedly a complex issue, though again there is a
need for organizations to be proactive. Certainly an argument could be made that
the Management of Health and Safety at Work Regulations would encourage
organizations to assess and act upon any potential risks of violence. Amongst
other things organizations could consider issues such as the underlying cause of
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the violence, working practices, and the provision of suitable training and support
needs (see HRM in practice 11.14).
Conclusion
Welfare, health and safety issues have become increasingly important to tourism
and hospitality organizations as the business case for proactive responses has
become recognized. In considering the ‘alphabet’ of welfare issues a number of
these issues seems to have a particular resonance within the tourism and hospital-
ity sector. The presence of demanding customers, the blurring of work and leisure
and often catalytic effect of alcohol create particular circumstances where the duty
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 274
HRM in practice 11.14 A proactive response
to ‘air rage’
IDS (2000) report on how Virgin Atlantic have sought to address violence at work, and
specifically air rage, by improving their HR approaches. Within the recruitment and selec-
tion process for instance Virgin look for key skills in relation to communication skills,
assertiveness and customer service orientation, and although not a primary consideration
in the selection process there is an assessment of how potential employees may respond
to difficult scenarios involving aggressive customers. Employees also receive training in
observation skills to help them identify potentially disruptive passengers at an early stage.
Staff are taught how to recognize potential precursors of an air rage incident, such as the
tapping of fingers or the reddening of a passengers face, and in response to these use
calming techniques, such as using friendly gentle tones and body language, to defuse
the situation. As a result of these approaches the need to have recourse to actual phys-
ical restraint has significantly decreased in Virgin Atlantic. If a major incident does occur
though the company also looks to provide a supportive response. There is an automatic
debriefing to the whole flight crew, even those employees not directly affected by the
incident. Attendance at such debriefings is mandatory and this recognizes that they may
be a delayed response from employees to what is a potentially very stressful experience
Further to that Virgin also provide follow-up counselling, if necessary, through their occu-
pation health department. Finally, the company also offers legal and financial support to
employees who wish to pursue legal action against assailants.
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of care of employers seems particularly pronounced. That said, it was also recog-
nized that in seeking to intervene in often sensitive issues that the balance between
an organizational members public and private life is far from clear cut. Undoubtedly
managers in modern organizations require an awareness of these issues and how
best to intervene for the benefit of both the organization and individual; a task that
is far from easy in dealing with potentially sensitive issues.
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Websites
http://www.managingabsence.org.uk/ provides employers with comprehensive information on cost-effective
approaches to managing short-term sickness absenteeism.
Two charitable organizations that campaign on issues related to AIDS/HIV are the Terence Higgins Trust and
the National Aids Trust, http://www.tht.org.uk/ and http://www.nat.org.uk/
The Ark Foundation is a service offered by Hospitality Action, set up for the purpose of educating hospital-
ity industry students, employees and management as to the dangers of alcohol dependency and other
drug misuse, http://www.thearkfoundation.co.uk/
DrugScope offers some interesting views on policy issues surrounding drugs and can be found at
http://www.drugscope.org.uk/
Women Against Sexual Harassment is a global organization that campaigns against sexual harassment,
http://www.washrag.org/
The Health and Safety Executive’s stress at work page can be found at http:// www.hse.gov.uk/
stress/index.htm
The Health and Safety Executive’s violence at work page can be found at http:// www.hse.gov.uk/
violence/index.htm
The Department of Trade and Industry has details of the Working Time Regulations and other case studies on
how reduce long hours http://www.dti.gov.uk/employment/employment-legislation/working-time-regs/
index.html
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Chapter 12
Grievance and
disciplinary procedures
Chapter objectives
This chapter examines the importance of rules and
regulations in the employment relationship,
focusing on grievance and disciplinary procedures.
Specifically, the chapter aims to:
? Consider the complementary nature of grievance
and disciplinary procedures.
? Identify sources of employee grievances.
? Assess the differing severity of organizational
responses to breaches of discipline.
? Recognize the need for fairness in dismissing
employees.
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Introduction
It is generally accepted that there is a need for procedures in the employment rela-
tionship to ensure that both managers and employees are aware of the expectations
of the organization (Marchington and Wilkinson, 2005). In this sense managers need
a framework in which to direct and guide behaviour of employees in the workplace.
Similarly employees need to understand their place in the organization and its expec-
tations. Thus, there is a need for some articulated order which is likely to be impor-
tant to sustain organizational effectiveness. Consequently rules are needed which
cover the whole range of human resourcing, such as what work is done, how jobs
are constituted, training and promotion, hours of work, health and safety and stan-
dards of behaviour and performance. Equally, there is a need for procedures to pro-
vide a framework which allows for notions of organizational justice and reciprocity.
This point is particularly true when we think of grievance and disciplinary proce-
dures. We can conceptualize grievance and disciplinary procedures as being com-
plementary, but also distinct. In this way the former is a mechanism whereby
employees can challenge management’s power, either collectively or individually,
and the latter is a way of establishing and maintaining standards which are accept-
able to management. Whilst much of this discussion may seem rather prosaic it is
important to recognize that all managers should have at least a working knowledge
of grievance and disciplinary procedures, particularly with regard to the ultimate
sanction of dismissal. Edwards (2005) notes how dismissal represents the ‘dark’ or
‘murky’ side of HRM and is often omitted in many discussions of the subject. It is
though a fact of organizational life, in much the same way as employees choosing
voluntarily to leave the organization. Ultimately, then, as Torrington et al. (2005: 554)
rather neatly express it, ‘The two complementary processes are intended to find
ways of avoiding the ultimate sanction of the employee quitting or being dismissed,
but at the same time preparing the ground for those sanctions if all else fails’.
Setting the scene on grievance and
disciplinary procedures
Salamon (1992: 568) defines grievance as, ‘a formal expression of individual or col-
lective employee dissatisfaction primarily, but not exclusively, in respect of the
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GRI EVANCE AND DI SCI PLI NARY PROCEDURES
application or non-application of collective agreements, managerial policies and
actions or customs and practice’. In recognizing the distinction between individual
and collective aspects of dissatisfaction many writers suggest that grievances are
usually about individual concerns, whilst collective dissatisfaction is likely to become
a dispute, especially if a trade union is involved. On the other hand, discipline is
defined by the same author as, ‘formal action taken by management against an
individual or group who have failed to conform to the rules established by man-
agement within the organization’ (Salamon, 2000: 565). Often grievance and discip-
linary procedures will be conceptualized in quasi-judicial terms wherein a body of
recognized rules is administered under a judicial-type procedure.
Although the argument in support for the establishment of clear rules and regu-
lations in an organizational setting seems compelling research undertaken in the
tourism and hospitality industry suggests that in the past some organizations have
been slow to develop policy. For example, Price (1994) found that only 24 per cent of
241 organizations she surveyed had a well-developed disciplinary procedure. More
recently though there is greater prescription emanating from legislation and since
1st October 2004 all employers, regardless of size, have to have a disciplinary and
grievance procedure and to notify their employees of it, in order to comply with the
Employment Act 2002 (LRD, 2006). In developing a policy an obvious starting
point is the influential Advisory Conciliation and Arbitration Service (ACAS) Code
of Practice on disciplinary and grievance procedures. Originally produced in 1977
and most recently revised in 2004 the code of practice provides a series of recom-
mendations on how best to approach grievance and disciplinary procedures.
Indeed, an awareness of procedure may be particularly apposite for tourism and
hospitality managers as evidence suggests that they may be more likely to find
themselves enmeshed in either a grievance or disciplinary situation. For example, the
Chartered Institute of Personnel and Development (CIPD, 2004) in a recent survey
of nearly 1200 UK and Irish companies (including 142 tourism and retail employers)
found that private sector service employers had twice as many grievance and disci-
plinary cases compared to the manufacturing, public and voluntary sectors.
Grievance procedures
What is a grievance? Generally, as we have noted a grievance is the right of
employees to express and attempt to resolve dissatisfaction that they might have
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in the work situation. Pigors and Myers (1977: 152, cited in Torrington et al., 2005)
outline degrees of discontent which employees may have in the workplace:
? Dissatisfaction: anything that disturbs an employee, whether or not the unrest is
expressed in words.
? Complaint: a spoken or written dissatisfaction brought to the attention of the
supervisor and/or trade union representative.
? Grievance: a complaint that has been formally presented to a management rep-
resentative or to a union official.
Grievances can take a number of forms and Salipante and Bouwen (1990) have
provided a widely used schema to categorize sources of conflict and grievance.
They suggest that conflict can be distinguished in three ways:
? Environmental conflict is primarily concerned with working conditions and
nature of work. These problems will encompass the economic terms and condi-
tions of the job, the physical job conditions and job demands either being too
great or too little for the individual’s skills and abilities.
? Social substantive these grievances stem from perceived inequalities in treatment
or disagreements over goals or means. Conflict of this nature may be precipi-
tated by organizational policy or management action, which creates a percep-
tion of inequity arising from how decisions are taken.
? Social relational grievances arise from the relationships between individuals and
groups within the organization, for example, personality conflicts, racism and
sexism.
The findings of the 2004 Workplace Employment Relations Survey echo the
above categorization, whilst also suggesting that the bulk of grievances raised are
more likely to be in relation to Salipante and Bouwen’s environmental and social
Review and reflect
What makes you unhappy at work? Would you be willing to articulate this dissatisfaction
as a grievance? If not, why not?
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substantive aspects. In that sense pay and conditions, relations with supervisors/
line managers and work practices, work allocation and the pace of work were the
most common grievances raised by employees (Kersley et al., 2006).
As suggested by our earlier recognition of Pigors and Myers work all of us at
some point in our organizational lives will have a degree of dissatisfaction with our
work situation, though the extent to which we will be willing to formally articulate
this will vary. Ordinarily, it is unlikely that we will choose to formally register our
dissatisfaction as a grievance. Instead, employees may express their dissatisfaction
in a number of ways short of formally registering a grievance. For example, employ-
ees may simply impose their own unilateral solution through things like increased
absenteeism, withdrawing their goodwill or in a reduction in morale/motivation.
Ultimately the dissatisfaction may be such that the employee chooses to leave and
the high rate of labour turnover in hospitality and tourism suggests that many
employees take such a course of action. If however an individual chooses to stay in
the organization and decides to formally present a grievance it is important that it is
properly considered and addressed. The ACAS code of practice offers a clear proced-
ure for addressing grievances, based on a three-stage approach (ACAS, 2004):
? The employee informs the employer of their grievance in writing.
? The employee should be invited by the employer to a meeting to discuss the
grievance where the right to be accompanied will apply and be notified in writ-
ing of the decision. The employee must take all reasonable steps to attend this
meeting.
? The employee is given the right to an appeal meeting if they feel the grievance
has not been satisfactorily resolved and be notified of the final decision.
Ordinarily, employees would initially raise the grievance with their line manager,
unless somebody else is specified in the organization’s procedure. Once received a
grievance will then lead to a meeting between the employee and manager where the
grievance will be discussed (and see Torrington et al., 2005 for details of how to
approach grievance and disciplinary interviewing). Finally, the decision will be
communicated in writing to the employee, who if they are still unhappy will then
have the right to appeal, which ordinarily would be dealt with by a more senior man-
ager, who again will write to the employee with the final decision. Importantly, if an
employee is to subsequently seek to take a grievance further through the employment
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tribunal (ET) system, then they automatically have to have first gone through the
organization’s grievance procedure.
Disciplinary procedures
Having examined grievance procedures we can now consider discipline in the
organization. In discussing discipline in the organization it is interesting to note
the extent to which we are likely to be predisposed to obey rules and authority.
Torrington et al. (2005: 555–556) draw on the work of the famous social psychologist
Stanley Milgram to suggest a number of features which explain our propensity to be
obedient towards authority and how this is likely to shape workplace behaviour:
? Family: the inculcation of respect for adult and parental authority encourages us
to generally respect authority.
? Institutional setting: in school, university and work we learn how to function in
an organization, often accepting our subordinate position.
? Rewards: compliance brings rewards, disobedience brings punishment.
? Perception of authority: authority is normatively supported, so we are generally
predisposed to follow organizational and managerial rules, but where this does
not happen the organization may have to take disciplinary action.
Again in developing a disciplinary procedure the ACAS code of practice provides
a template suggesting that good disciplinary procedures should (ACAS, 2004):
? Be in writing.
? Specify to whom they apply.
? Be non-discriminatory.
? Ensure matters are dealt with without unnecessary delay.
Review and reflect
What might explain our pre-disposition to respect rules and authority?
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? Allow for information about proceedings, witness statements and records to be
kept confidential.
? State the disciplinary actions which may be taken.
? Specify the levels of management which have the authority to take the various
forms of disciplinary action.
? Provide for employees to be informed of complaints against them and where
possible all relevant evidence before any hearing.
? Give employees the opportunity to state their case before a decision is reached.
? Provide employees with the right to be accompanied by a trade union repre-
sentative or fellow employee at any hearing.
? Ensure that except for gross misconduct, no employee is dismissed for a first
breach of discipline.
? Ensure that disciplinary action is not taken until the case has been carefully
investigated by management.
? Ensure that employees are given an explanation for any penalty imposed.
? Provide employees with rights to appeal, normally to a more senior manager.
Implicit in the guidelines is recognition of the differing severity of organizational
responses in terms of misconduct and ordinarily the distinction is made between
minor misconduct, serious misconduct and gross misconduct. For many instances
of minor misconduct or unsatisfactory performance a quiet word from a manager
may be all that is needed to improve an employee’s performance and resolve the
issue. However, if this informal action does not bring the desired improvement
then an employer may take a more formal approach. As with grievance proced-
ures the ACAS code of practice outlines a three-stage approach to discipline. First,
the employer signals to the employee in writing what they have done wrong.
There will then be a meeting to discuss the problem, where the employee will
be allowed to ask questions, present evidence, call witnesses and be given an
opportunity to raise questions about information provided by witnesses. Lastly,
the employer must then decide on the basis of the meeting whether the discipli-
nary action was justified and if that is the case the nature of any sanction against
the employee. The decision on disciplinary action will clearly be influenced by the
nature of misconduct and in that sense Figure 12.1 outlines a typical disciplinary
procedure with commensurate organizational responses.
Examples of minor/serious misconduct could include things such as persist-
ent absenteeism, poor timekeeping, failure to adhere to dress codes or appearance
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standards or unacceptable performance and if employees do receive a oral or writ-
ten warnings they are likely to have a specified ‘life’, after which they are disre-
garded. For example, for an oral warning the period is likely to be for 6 months,
whilst for a written warning it will be 1 year and a final written warning, 2 years
(CIPD, 2005). For gross misconduct ACAS (2004) notes how instances of such mis-
conduct are likely to be decided by the organization given their own particular cir-
cumstances, whilst still noting some typical examples, including:
? theft or fraud;
? physical violence or bullying;
? deliberate and serious damage to property;
? serious misuse of an organization’s property or name;
? deliberately accessing internet sites containing pornographic, offensive or
obscene material;
? serious insubordination;
? unlawful discrimination or harassment;
? bringing the organization into serious disrepute;
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 286
Nature of the disciplinary
matter
Management response and
action
Minor misconduct Recorded oral warning
Serious misconduct or repeated
minor misconduct for which a
written or oral warning has
been received
Written warning followed by
final written warning
Gross misconduct or further
misconduct for which a final
written warning has been
received
Action short of dismissal:
• Transfer
• Demotion
• Suspension
Dismissal
• Reward deferment
Figure 12.1 Typical disciplinary procedure
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? serious incapability at work brought on by alcohol or illegal drugs;
? causing loss, damage or injury through serious negligence;
? a serious breach of health and safety rules; and
? a serious breach of confidence.
Recent research undertaken by Industrial Relations Services (IRS, 2005) is useful in
pointing to the reasons for disciplinary action. In a survey of over 100 employers
in all sector of the economy they found that the most likely issues for disciplinary
action were attendance, performance and capability, timekeeping and general behav-
iour and conduct. Clearly, most of these aspects are likely to fall into the minor/seri-
ous misconduct category so it is likely to be rare for employees to be dismissed for
gross misconduct. Regardless though of whether an employee is dismissed for
gross misconduct or repeated minor or serious misconduct a key point is that any
dismissal should follow due procedure, something that we now consider.
Employers need to ensure that disciplinary procedures are fully utilized to
ensure that any dismissal is considered ‘fair’, both in a legal and moral sense. For
example, an organization might consider it has acted ethically in dismissing an
employee, but even if an organization or individual acting on behalf of the organ-
ization has acted in good faith, an ET may decide the dismissal was unfair if the
correct procedure is not followed. Clearly, then, a key point in any dismissal is the
notion of whether the organization has acted in an reasonable, equitable and pro-
cedurally fair manner, if not then the organization could be faced with a claim for
unfair dismissal. In considering whether a dismissal is fair or unfair we should
firstly consider acceptable reasons for dismissal. Taylor and Emir (2006) note how the
number of potentially fair reasons was originally five as outlined in the Employment
Rights Act 1999, with a sixth being added under the Employment Relations Act
1999 and further reasons relating to Transfer of Undertaking Regulations (TUPE)
and mandatory retirement being added in 2006. The most likely reasons for dis-
missal though are likely to be (and see HRM in practice 12.1):
? Lack of capability: this may refer to when employees may encounter difficulties
in their performance and struggle to fulfil their responsibilities; alternatively
there may also be situations where an employee is unable to do their job due to
ill-health.
? Misconduct: as we noted above this can range from minor to gross misconduct
with differing sanctions.
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? Redundancy: the law in redundancy is quite complex, though in simple terms
a redundancy will arise when a business is closing, a workplace is closing or
there is a diminishing need for employees to do particular kinds of work in an
organization.
? Statutory bar.
? Some other substantial reason: this category is deliberately vague as it is intended
to give employers scope to dismiss employees in circumstances that were not
envisaged when the legislation was drawn up.
In further considering the notion of whether a dismissal is fair it is important to
recognize that there are a number of things which would be considered automat-
ically unfair regardless of the qualifying period, these being (LRD, 2006):
? Dismissal on grounds of pregnancy or assertion of paternal paternity or adoption
leave rights.
Review and reflect
To what extent is a course of the nature described in Box 12.1 ethical?
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 288
HRM in practice 12.1 Prime candidates
for dismissal?
Rayner (1998) reports on the controversy created in the late 1990s when it emerged that
some local authorities were sending managers on a course to learn how to sack trouble-
some employees. The course was run by an American company, Padgett-Thompson.
Amongst other things the course offered participants advice on how to ‘deal with
employees who drive you crazy’ or good performers who had ‘know it all attitudes’. The
course also offered ‘a tried and tested technique for silencing employees who want to
argue about being dismissed’. In addition the course identified four employee types who
managers are likely to want to dismiss. These types were the chatterbox (who keeps
everyone away from work by constantly talking with colleagues), the plotician (who col-
lects the dirt on colleagues and enjoys manipulating those around them), the shark (who
enjoys making people squirm and chews up anyone who gets in their way) and the
snoop (who delves into other people’s personal things and private lives).
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? Dismissal on grounds of trade union membership or stating an intention to join
a trade union.
? Refusing to work on a Sunday (in the case of retail workers).
? Dismissal on grounds of actual or proposed trade union activity undertaken at
an appropriate time.
? Dismissal resulting from individual’s refusal to join a trade union.
? The dismissal of an employee without going through the required disciplinary
procedure.
? Dismissal connected with the transfer in the organization’s ownership – TUPE
(2006).
? Where no reason for dismissal is given.
? Where the employee has been unfairly selected for redundancy.
? Dismissal on basis of past criminal offence which is spent.
? Unfair dismissal on the basis of sex, race, disability, sexual orientation or
religion/beliefs.
? During the first 12 weeks of official industrial action (i.e. action sanctioned by a
trade union executive body).
? Asserting a statutory right, for example the national minimum wage (NMW).
? ‘Blowing the whistle’ on malpractice in the workplace.
? Refusal to do something on health and safety grounds.
In 2004–05 there were nearly 40000 claims for unfair dismissal submitted to the
Employment Tribunal Service (ETS, 2005). Of these, the vast majority were withdrawn
or settled with the intervention of ACAS. Ultimately, just over 7500 cases reached a for-
mal ET hearing. Of those cases that were heard by the tribunal service over 50 per cent
were dismissed, with 46.3 per cent being upheld (ETS, 2005). Clearly in assessing
the fairness or otherwise of the dismissal the ET will assess whether dismissal was
carried out in line with procedures (reiterating the need for organizations to have
well-established and transparent procedures related to disciplinary issues). To
judge whether a dismissal is fair the ET is likely to consider the following issues:
? Was dismissal for admissible reason?
? Was dismissal fair in sense of equity of treatment between employees?
? Was dismissal fair in the sense of the offence or the employee record justifying
the dismissal?
? Did the employer follow proper procedures?
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As noted above the success rate for employees in ETs is not very high, but if they
win their case then there are several options open to the ET. The first is the basic
award, which depends on length of service and age and is based on the same rate
as statutory redundancy pay (LRD, 2006):
? aged under 22: half a week’s pay for each complete year worked under this age;
? aged 22–40: one week’s pay for each complete year worked between these
ages; and
? aged 41–65: one and a half week’s pay for each complete year worked between
these ages.
In addition, there is also a compensatory award, which considers aspects such as
loss of earnings, loss of pension rights and the cost to an employee of time and effort
in seeking new work. In awarding a compensatory award the ET can also award an
amount that it considers ‘just and equitable’ given the circumstances (LRD, 2006).
Recent changes in the law now mean that there is no upper limit for cases where dis-
missal was based on discrimination, for health and safety or whistle blowing rea-
sons. For other cases the maximum compensatory aware is £58400 (LRD, 2006). In
2004–05 the highest award was £75250, though the median award was £3476 and
average award £7303 (ETS, 2005). The final option is either reinstatement (where the
employee gets their old job back) or re-engagement (where they are given a different
but comparable job). In reality, very few people take this option and in 2004–05 just
14 successful claimants chose this course of action (ETS, 2005).
Conclusion
The chapter has considered the need for a clearly articulated order in the organiza-
tion, particularly with regard to grievance and disciplinary procedures. Evidence
suggests that these issues may have a particular resonance within tourism and
hospitality; yet at the same time tourism and hospitality organizations often seem
to lack the formal policies which sustain a sound approach to towards these issues.
Although the predominance of small and medium-sized enterprises (SMEs) may
go some way to explain this lack of formal policies and procedures, legislation means
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that all organizations should now have well-established grievance and disciplinary
procedures. Establishment of such procedures mean that employees have a chan-
nel in which to express their dissatisfaction and employers a means by which to
articulate concerns about employee performance or behaviour. Though character-
ized as the ‘murky’ or ‘dark’ side of HRM, dismissal is an organizational reality
and all managers should be aware of what constitutes a fair or unfair dismissal.
Although a relatively small numbers of cases end up at the ET those that do may
lead to an organization facing significant costs for a badly handled dismissal. In
this way it is clear that rules and procedures in the employment relationship are
integral to ensure that decisions taken by organizations are both ethically and pro-
cedurally fair and a sense of natural justice prevails in the organizational setting.
References and further reading
Advisory Conciliation and Arbitration Service (2004) Disciplinary and Grievance Procedures Code of
Practice, ACAS.
Chartered Institute of Personnel and Development (2004) Managing Conflict at Work: A Survey of the UK
and Ireland, CIPD.
Chartered Institute of Personnel and Development (2005) Disciplinary and Grievance Procedures
Factsheet, CIPD.
Edwards, P. (2005) ‘Discipline and attendance’, in S. Bach (ed.) Managing Human Resources: Personnel
Management in Transition, Blackwell, 4th edition, 375–397.
Employment Tribunal Service (2005) Annual Report and Accounts 2004–05, The Stationary Office.
Industrial Relations Services (2005) ‘Disciplinary and grievance policies at work’, IRS Employment Review,
No. 825, 10 June, 9–18.
Kersley, B., Alpin, C., Forth, J. et al. (2006) Inside the Workplace: Findings from the 2004 Workplace
Employment Relations Survey, Routledge.
Labour Research Department (2006) Law at Work, LRD.
Marchington, M. and Wilkinson, A. (2005) Human Resource Management at Work: People Management
and Development, 3rd edition, CIPD.
Pigors, P. and Myers, C. S. (1977) Personnel Administration, McGraw Hill, 8th edition.
Price, L. (1994) ‘Poor personnel practice in the hotel and catering industry – does it matter?’, Human
Resource Management Journal, 4(4), 44–62.
Rayner, J. (1998) ‘Bolshie staff? We have ways of purging them’, Observer, 13 December, 6.
Salamon, M. (1992) Industrial Relations – Theory and Practice, Prentice Hall.
Salamon, M. (2000) Industrial Relations – Theory and Practice, 4th edition, Prentice Hall.
Salipante, P. and Bouwen, R. (1990) ‘Behavioural analysis of grievances: conflict, sources, complexity and
transformation’, Employee Relations, 12(3), 17–22.
Taylor, S. and Emir, A. (2006) Employment Law: An Introduction, Oxford University Press.
Torrington, D., Hall, L. and Taylor, S. (2005) Human Resource Management, 6th edition, Prentice Hall.
GRI EVANCE AND DI SCI PLI NARY PROCEDURES 291
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Websites
ACAS has a number of useful resources at http://www.acas.org.uk/index.aspx?articleid?360&detailid?548
The Department of Trade and Industry’s page on dispute resolution can be found at http://www.dti.gov.uk/
employment/Resolving_disputes/index.html
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 292
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Chapter 13
Concluding comments
293
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 294
This book has sought to offer a comprehensive review of competitive strategies, and
concomitant HRM practices in the international tourism and hospitality sector. It
has painted a complex picture of the sector, and particularly the differing routes
to competitive advantage which organizations may adopt. Clearly, the book has
demonstrated that it is virtually impossible to entirely generalize the employment
experience in tourism and hospitality. In particular, the extent to which organizations
may be aspiring to best practice HRM remains a point worthy of further debate and
research.
Clearly recognition of this point has a major impact on the nature of work,
employment and people management in tourism and hospitality industry. In that
sense from a HRM point of view, in crude terms, there is much evidence to support
an approach in the tourism and hospitality sector to HRM which is more ‘best fit’
than ‘best practice’. Marchington and Grugulis’ (2000: 1121) view that ‘best prac-
tice, it seems, is problematic’ is certainly borne out by the tourism and hospitality
sector. Much as policy-makers would like the sector to be characteristic of a high
wage, high skill, high quality, high value-added approach, clearly the low and
mixed skill context of the tourism and hospitality sector a more nuanced approach
is called for. Large numbers of tourism and hospitality employers do not necessar-
ily need to look to develop high value added approaches. As a consequence, high
value added approaches have to be seen in relation to ‘a broader package of envir-
onmental, cultural and structural features that can nurture and support high per-
formance, high value added industries and sectors’ (Keep and Mayhew, 1999: 4).
These conditions do not exist universally across the tourism and hospitality sector
and resultantly the ‘best fit’ approach of designing HRM practices which are con-
tingent upon the particular customer definition of ‘good service’ would seem
apposite. Notions of ‘good service’ will differ markedly across market segments
and between tangible and intangible aspects of the tourism and hospitality prod-
uct. Given this reality, practices which may be desirable to employees such as
levels of high pay, extensive training and job security, are not necessarily cost effect-
ive for many tourism and hospitality organizations, a point which Riley et al.
(2000) strongly advocate in their arguments about economic determinism. In this
sense then the ‘poor’ personnel practices of tourism and hospitality organizations
that are noted by a number of authors may reflect any number of reasons. However
it is important to stress that there is still an element of choice for employers and
claims to the immutability of ‘poor’ personnel practice should be treated with
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CONCLUDI NG COMMENTS
some caution. As the DfEE (2000: 13) notes in describing employment practices in
the sector:
Some of these deficiencies reflect labour market circumstances, commercial
constraints and lack of awareness of options, but some reflect poor human
resource management, unwillingness to take risks or invest in innovation
and short termism: most vividly exemplified by the low pay, crisis manage-
ment culture of the less impressive establishments.
Equally, though, there is clearly some evidence for good practice HRM in the tourism
and hospitality industry and the book has sought to highlight such practices through-
out. An obvious question stemming from this recognition of good practice, which we
have sought to answer is: if best practice does exist, what does it look like? More often
than not it is likely to be large, often multinational organizations who exemplify a
number of the practices, as described by the likes of Hoque (2000) and illustrated by
a number of examples in this book. Indeed, recognizing the nature of the small and
medium enterprise (SME) sector it may well be that notions of best practice need to
reconfigured within this particular sector. As Worsfold (1999: 346) notes, ‘In the case
of small hotels we may need to abandon the search for formal HRM approaches and
attempt to establish whether “caring management” can provide the “concern for
employee well being” which appears to be linked to service quality.’
Generally, whilst this book concludes that the HRM strategies of firms are heav-
ily shaped by contextual contingencies, including national, sectoral, organizational
and occupational factors, and therefore are more redolent of best fit, such a conclu-
sion does not necessarily invalidate best practice thinking. For example, Haynes
(1999: 200) argues that in relation to best practice HRM in the hospitality sector:
Sometimes the critical verges on the hysterical … In an industry characterized
by relatively low levels of pay and high levels of arbitrary management prac-
tice, the adoption of many of the HRM practices in question would undoubt-
edly improve the work experience of hospitality workers. For that reason
alone the model should not be rejected out of hand by hospitality researchers.
As Boxall and Purcell (2000: 1930) suggest ‘… there are certain broadly applicable
principles and processes of good labour management.’ The diffusion of these practices
295
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 296
as best practice does remain problematic and difficult to achieve throughout the
tourism and hospitality sector. However, the fact that diffusion of these sorts of
practices is potentially limited does not invalidate their utility. Thus, although the
‘deluxe’ version of best practice may remain out of reach of large numbers of
tourism and hospitality organizations, at the very least there should be aspirations
to at least go for the ‘economy’ version to offer a more rewarding and meaningful
employment experience for the many who work in the sector.
References
Boxall, P. and Purcell, J. (2000) ‘Strategic human resource management: Where have we come from and
where should we be going?’, International Journal of Management Reviews, 2(2), 183–203.
Department for Education and Employment (2000) Employers Skill Survey: Case Study Hospitality
Sector, DfEE.
Haynes, P. (1999) ‘A new agenda for researching hospitality HRM: comment on Lashley and Watson’,
Tourism and Hospitality Research, 1(3), 199–204.
Hoque, K. (2000) Human Resource Management in the Hotel Industry, Routledge.
Keep, E. and Mayhew, K. (1999) ‘The assessment: knowledge, skills and competitiveness’, Oxford Review
of Economic Policy, 15, 1–15.
Marchington, M. and Grugulis, I. (2000) ‘“Best practice” human resource management: perfect opportun-
ity or dangerous illusion?’ International Journal of Human Resource Management, 11(6), 1104–1124.
Riley, M., Gore, J. and Kelliher, C. (2000) ‘Economic determinism and human resource management prac-
tice in the hospitality and tourism industry’, Tourism and Hospitality Research, 2(2), 118–128.
Worsfold, P. (1999) ‘HRM, performance, commitment and service quality in the hotel industry’,
International Journal of Contemporary Hospitality Management, 11(7), 340–348.
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360-degree feedback, 183
Absence
alcohol/drug misuse, 252–254
causes, 245
management, 243–247
organization policy, 245
proactive approaches, 247
review interview, 246
Accor Group, 231
Adaptive culture, need for, 64
Adult minimum wage, comparison, 205
Advertising agencies, 98–100
recruitment advertising, judging
criteria, 99
Advisory Conciliation and Arbitration Service
(ACAS) code of practice, 281
on disciplinary procedure, 284–285
on grievance procedure, 283
Aesthetic labour, 93, 95–96
Aesthetics, 58
Age-diverse workforce steps, 132
Age Diversity in Employment, 131
AIDS/HIV, 247–252
age composition and accommodation, 248
homosexual males, 248
organizations policies, consideration aspects,
252
policy responses, 251–252
potential response
bounded rationality response, 250–251
rational response, 250
subjective response, 251
public fears, 249
public misperceptions, 250
sexual activity, in tourism industry, 249
work nature, 248–249
Air rage, 273
proactive response, 274
Alcohol/drug
developing policy, 254–256
drug abuse, 253, 254
misuse, 252–256
testing, 256
Americo, 32
ANO hotels, rhetoric and reality of appraisal,
178
Anti-discriminatory legislation, 123
Appraisal, in practice, 14, 172–185
appraisal form, 184
appraisal interview, 184–185
approaches, 182–183
individual performance, 181
practicalities, 177, 183–185
problems, 175–176
reasons for, 172–173
rhetoric and reality, in ANO hotels, 178
schemes, 177
talking points, 179
views, 174–175
negative, 175
positive, 174
Apprenticeships, 151
Aptitude test, 108
Artefacts and creations, 57
Asia, 40
Assessment centres, 101, 109
easyJet, 110
Association of British Travel Agents (ABTA), 197
Assumptions, 57, 62
Attitude survey, 230
Attitudes, 57, 62, 122
Australia, 44, 226, 265
Bain, George, 200
Bazooms, 262
Behaviour, 54, 61–62, 63, 248, 258, 259, 262–263,
264
297
Index
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Behaviourally anchored rating scales (BARS),
180
Belgium, 45
Beliefs, 57, 62
Best fit, 11–13
vs. best practice, 10–11
Best practice, 10–11, 13–15, 20–21
Bickerstaffe, Rodney, 201
Black and minority ethnic people, employment
experience, 117–119
Blatcherism, 223
British Airline Pilots Association (BALPA), 256
British Airways
religious discrimination, 131
tackling absence, 246
British Hospitality Association (BHA), 18, 200
Café Pasta, 235
‘Cafeteria’ approach, 137, 189
Canada, 155
Caterer and Hotelkeeper, 192, 271
Centricity, impact of, 30–31
Chartered Institute of Personnel and
Development (CIPD), 99, 132, 150, 170,
183, 218, 222, 236, 244, 281
China, 46, 233
Club Med, 236
Cold pricklies, 61
Collective approach, 220, 221
Commercial hospitality industry, 5, 199
Commission for Equality and Human Rights
(CEHR), 133
Commission for Racial Equality (CRE), 109, 124
Company paternalism, in welfare policy, 243
Competitive advantage, 8
Competitive strategies, 15, 16
Complaint, 263, 282
Conflict, 216, 282
Conflict resolution, 219–222
Content validity, 110
Core and peripheral employees, 81
Corporate architecture, 57
Corporate conscience, in welfare policy, 242
Corporate culture, 32, 33, 54, 55
Corporate identity, 58
Corporate stories, 60
Cost reduction strategy, 11–12
Country-of-operation, 41
Country-of-origin, 37–39
generalizations, 38, 39
Coupland, Douglas, 2, 194
Covey, Stephen, 174
Cultural phenomenon, in organizations, 57
Culture, in IHRM, 41–43
individualism, 42
masculinity, 42
power distance, 41
uncertainty avoidance, 42
see also organizational culture
Customer appraisal, 182
Customer surveys, 182–183
Deming, W. Edwards, 174
Dermody, Paul, 192
Designer restaurant, 19
Direct discrimination, 124
Disability Discrimination Act (Amendment)
Regulations 2003, 123
Disability Discrimination Act (DDA), 126,
251
Disability Discrimination Act 1995, 123
Disability Discrimination Act 2005, 123
Disability, perception, 120
Disability Rights Commission (DRC), 124,
133
Disabled employees, experience, 119–120
two-ticks scheme, 120
Disciplinary procedures, 284–290
ACAS code of practice, 284–285
discipline, definition, 281
Dismissal, 287–289
reasons for, 287–288
unfair conditions, 288–289
Disney, use of language, 60
Dissatisfaction, 282
Diversity management training initiatives
(DMTIs), 135
Diversity oriented organizations, 136–137
Dorchester Hotel, organizing failure in, 225
Downward communication, 229–230
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Drinking see alcohol/drug
Drug see alcohol/drug
E-learning, 162
EasyJet, assessment centres, 110
Economics, 17–18
Edmonds, John, 192
Employee assistance programmes (EAPs), 254,
271
Employee–employer views, of pay
employee objective
composition, 191
felt to be fair, 190
purchasing power, 189–190
recognition, 191
relativities, 190–191
rights, 190
employer objectives
change management, 194–195
competition, 193
control, 193
cost, 194
motivation and performance, 193
prestige, 191–193
Employee involvement, 14, 228–233
Employee participation, 234
Employee relations, 14, 217–222
conflict resolution, 219–222
frames of reference, 218–219
Employment Act 2002, 75, 281
Employment Equality (Religion or Belief)
Regulations 2003, 123
Employment Equality (Sex Discrimination)
Regulations 2005, 123
Employment Equality (Sexual Orientation)
Regulations 2003, 123
Employment experience
black and minority ethnic people, 117–119
disabled employees, 119–120
older workers, 121–122
women, 116–117
Employment-related legislation, 75
Employment Relations Act 1999, 75, 222, 287
Employment Relations Act 2004, 222
Employment Rights Act 1999, 287
Employment tribunal (ET), 115, 124, 126, 127,
289–290
basic award, 290
compensatory award, 290
Empowerment, 232, 233
Environmental conflict, 282
Equal opportunities, 114, 243
employment experience, 116–122
legislative response, 122
managing diversity, 133–137
Equal Opportunities Commission (EOC), 109,
124, 133
Equality and diversity
business aspects, 115
ethical aspects, 115
key issues, 116
legal aspects, 115
Equality Act 2006, 133
Ethnocentric approach to internationalization,
28–29, 30
EU, 40, 71, 72, 73, 74, 131, 236, 244, 253, 275
EU expansion
labour and skill shortages, solutions, 73
EU Social Chapter, 74
European Court of Justice (ECJ), 271–272
European social model vs. Anglo-Saxon
approach, 73–74
European Works Councils (EWCs), 234–237
External fit, ensuring method, 8
External labour market, 96
national, 72–76
sectoral, 76–80
transnational, 72
External off-the-job training, 162–163
Face validity, 110
Feedback, 110–111, 182–183
Feminization, in labour market, 75
Fiddles and knock-offs, 209
First Choice Airways, 198, 210
Flexible firm model, core and peripheral
employees, 81
Flirting, 208, 260–261
France, 207, 236, 265
Frenco, 32
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Front-line tourism and hospitality employee, 59,
93–104
Functional flexibility, 81–83
Genuine Occupational Qualification (GOQ), 126
Geocentric approach to internationalization, 28,
29–30, 36
human resource profile, 31
George, Peter, 192
Germany, 43, 144, 145, 203
Glasgow, 95
Global economy, American dominance of, 40
Global hotel industry, orientations in, 32
Grievance procedures, 281–284
ACAS code of practice, 283
conflict, 282
degrees, of discontent, 282
grievance, definition, 280–281
Guest Service Staff (GSS) training, 97–98
Hard HRM, 83–84
vs. soft HRM, 9–10, 169
Health and Safety at Work Act (HASWA) 1974,
267
Health and Safety Executive (HSE), 266, 268–269
Health and Social Care (Scotland) Act, 266
Heroes, 60
Hilton International, Fast-track Elevator
programme, 101
Hologram, 8, 20
Hooters, 262
Hotel, Catering and Tourism Sector (HCTS), 3
HRM
best fit, 11–13, 294
best fit vs. best practice, 10–11
best practice, 13–15, 20–21, 295–296
convenient shorthand term, 7
cycle, 16
definitions, 7–9
hard vs. soft, 9–10
airline industry, 10
label, 7
Manipulative device, 8
Map, 8
models and reality, 15–17
pessimistic view, 17–19
personnel problems, 17
HRM quality enhancer hotel, 21
Human resource development (HRD), 142
Human Rights Act 1998, 123, 256
In-company off-the-job training, 160–162
In-company on-the-job training, 160
In-tray exercise, 109
Income Data Services (IDS), 202
Indirect discrimination, 124
Individual performance, measuring
criteria, 181
factors, 181
Induction crisis, 161
Industrial relations, 217–222
Industry level, 152–153
Information and Consultation of Employees
(ICE) Regulations 2004, 236–237
Innovation strategy, 11
Institute of Professional Advertisers (IPA), 99
Institutional perspective, 43–44
Intelligence test, 108
Intermediaries, 4
Internal fit, ensuring method, 8
Internal labour market
and flexible labour utilization, 80
functional flexibility, 81–83
numerical flexibility, 83–84
International hotel industry, American
dominance of, 40
International human resource management
(IHRM), 7, 26
emergence, 27–28
centricity, 30–31
country-of-operation, 41
country-of-origin, 37–39
culture, importance of, 41–43
institutional perspective, 43–44
international managers role in, 33, 35–37
international staffing, 32–33
Perlmutter’s work attempts, 28–30
MNCs and HRM policies and practices, 44–46
International Labour Organization (ILO), 6, 18,
223
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International managers, role in IHRM, 33, 35–37
International staffing, 32–33
host-country nationals (HCNs), 32, 33, 34
parent-country nationals (PCNs), 32, 33, 34
third-country nationals (TCNs), 32, 33, 34
Interpersonal skills, 93, 94
Interviewing, 105–111
Investors in People (IiP), 147–150
principles, 148, 149
Italy, 125, 203, 244, 265
Japan, 38, 144
Job analysis, 90–91
Job description, 91, 150, 180, 191
Job security, 14, 233
Jurys Inns, recruitment and training strategy,
97–98
Kelleher, Herb, 60, 61
Labour market, 71
external market, 71–72, 80, 96
national, 72–76
sectoral, 76–80
transnational, 72
internal market, 71–72, 80, 96
functional flexibility, 81–83
numerical flexibility, 83–84
Labour supply
challenges, 71
in hotel sector, 84
Language, 59
usage, in Disney, 60
Legalistic-reactive approach, in welfare policy, 242
Legislative response
anti-discriminatory legislation, 123
jobs for girls, 125
physical/mental impairment conditions, 127
policy responses, for lesbian and gay, 129–130
religious discrimination, British Airways, 131
response to disability, 127
visually impaired employees, responding to
the needs, 129
Living wage, 202
Long-term absence, 244–245
Low pay, history, 198
Low Pay Commission (LPC), 200, 201, 203
Low Pay Unit (LPU), 200, 201
Lufthansa, social partnership in, 220
Luxury hotels and employment experience, 78
Mallorca, 199, 249
Managerial Thatcherism, 223
Managing diversity, 133
definitions, 134
diversity management training initiatives
(DMTIs), 135
diversity oriented organizations, 136–137
and equal opportunities, differences, 135
Mandatory retirement, 287
Marginal workers, 6–7, 22, 77
Market-driven approach, 8
Marriott Marble Arch, Discovery cross-training
scheme, 82
Mass service, 12–13
Material objects, 57
McDonald’s, 12, 13, 40, 44, 58, 63, 194, 205
McGregor, Douglas, 174
McJob, challenging perceptions, 194
Mentoring, 160
Metaphors, 59, 61, 219
Mission statement, 57–58, 161
Models and reality, 15–17
Modern Apprenticeships see apprenticeships
Morris, Bill, 201
Multinational companies (MNCs), 72
and HRM policies and practices, 44–46
Multi-rater feedback see 360-degree feedback
Munro Fraser five-fold grading system, 92–93
‘Mystery’ or ‘phantom’ shopper, 183
Myths, 60
from hospitality entrepreneurs, 62
National labour market, 72–76
National Minimum Wage (NMW), 195, 199–200
evolution, in UK, 204
in leisure industry, 193
National Minimum Wage Act, 75, 200
National skill-creation system, 145
National Vocational Qualification (NVQ), 97, 132
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National works councils, 234–237
National/Scottish Vocational Qualifications
(N/SVQs), 146–147
Needed role behaviours, 11–12
The Netherlands, 45, 265
New Zealand, 207
Norway, 75, 125, 265
Numerical flexibility, 83–84
Off-the-job training
external, 159, 162–163
in-company, 159, 160–162
Older workers, employment experience,
121–122
ability vs. inability, 121
Oliver, Tom, 192
On-the-job training (OJT), in-company, 160
Online recruitment, 100–102
Opportunity Now, 118, 119, 120
Organizational culture, 51
adapting, failure, 64
aspects/elements, 56
competing views, 53
optimists, 53
pessimists, 53–55
realists, 55–56
definition, 51–53
and HRM, 65
contradictions and dilemmas, 66
as Orwellian mechanism, 55
and performance
adaptive culture need, 64
contingent view, 64
reverse relationship, 64
strong culture thesis, 63
phenomenon, 57
at Pizza Hut, 61
recognition, 52
at Regent hotel, 54
Organizational strategies, 14
Organizing failure, in Dorchester Hotel, 225
Orwellian mechanism, 55
Padgett-Thompson, 288
Parental Leave Directive, 74
Part-time employees, regulations on, 75
Pay determination, influences on, 195, 196–197
Pay disparities, 192
Peer appraisal, 182
People 1st, 3, 152
Performance appraisal, 169
definition, 170–171
nature of, 170–172
parameters, 171
in practice see appraisal, in practice
Performance management system (PMS), 169
aims, 169
managing poor performance, 185–186
nature of, 170–172
Perkins, Steve, 235
Perlmutter, Howard, 28–30
work attempts, 28–30
ethnocentric approach, 28–29
geocentric approach, 28, 29–30
polycentric approach, 28, 29
Person/job interaction, 105
Person specification/competency profile, 91–92
Munro Fraser five-fold grading system, 92
Rodger seven-point plan, 92
shortlisting, 103–104
Personality test, 108–109, 110
Personnel problems, 17
Pessimistic views, of HRM, 17–19
Physical/mental impairment conditions, 127
Pilot Change Agenda, 210
Pizza Hut, 73, 203
metaphor usage in, 61
PizzaExpress, 203, 235
Pluralist perspectives, employee relations,
219–220
Polycentric approach to internationalization, 28,
29, 30, 35
Pontins, 150
Poor performance, management of, 185–186
Predictive validity, 110
Presentation skills, 109
Professional practices set, 8
Professional service, 13
Prosser, Sir Ian, 192
Psychometric test, 21, 101, 106, 108, 109, 111
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Quality circles (QCs), 231
Quality enhancement strategy, 11
Race for Opportunity (RfO), 119, 131
Race Relations (Amendment) Act 2000, 123
Race Relations Act (RRA), 121
affirmative action see positive action
Genuine Occupational Qualification (GOQ),
126
positive action, 125
Racial equality, practical steps, 119
Range of surveillance techniques, 183
Realistic recruitment, in cruise industry, 103
Realists, 55–56
Recruitment, 14
advertising agencies, 98–100
definition, 90
front-line tourism and hospitality employee,
93–104
job analysis, 90–91
job description, 91
online recruitment, 100–102
person specification/competency profile, 91–92
Munro Fraser five-fold grading system, 92–93
Rodger seven-point plan, 92
realistic recruitment, in cruise industry, 103
shortlisting, 103–104
skills required, 89
sources, 102
Regent hotel culture, 54
Rehabilitation of Offenders Act 1974, 123, 132
Remuneration
basic or base pay, 196–199
wage regulation, 199–206
Retention, 14
Reward strategies, 189
benefits, 210–211
employee–employer views of pay, 189–195
fiddles and knock-offs, 209
for quality, 14
remuneration, 196–206
tipping practice, 206–209
Robinson, Gerry, 192
Rodger seven-point plan, 92
Russia, 46
Scotland, 73, 95–96, 151, 266
Scotland with Style, 95–96
Scott, Amanda, 150
Sector Skills Council (SSC), 3, 152
Sectoral labour market, 76–80
Selection, 14, 104–111
assessment centres, 109
criteria, 105
definition, 104
reliability, 109–110
techniques
aptitude test, 108
in-tray exercise, 109
intelligence test, 108
interviewing, 105–108
personality test, 108–109
presentation skills, 109
problem-solving, 109
psychometric testing, 108
two-way process, 105
validity, 110
Self-appraisal, 182
Service factory, 12
Service organizations, 58, 59
Service shop, 12
Sex Discrimination (Gender Reassignment)
Regulations 1999, 123
Sex Discrimination Act (SDA), 124
affirmative action see positive action
Genuine Occupational Qualification (GOQ), 126
positive action, 125–126
Sexual activity
in tourism industry, 249
in workplace, 257–258
Sexual harassment, 256–264
in airline cabin crew, 261
breeding ground, 259–263
developing policy, 263–264
flirting, 260–261
Hooters, 262
of hotel workers, 260
prevention, reasons for, 258
Shadowing, 160
Short-term absence, 244, 246
Shortlisting, 103–104
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Singapore, 44, 45
‘Sitting next to Nellie’, 160
Small- and medium-sized enterprises (SMEs),
171, 224
SMART mnemonic, 173
Smile supervisors, 63
Smoking, 264–266
global curb, 265
Social partnership, in Lufthansa, 220
Social relational grievance, 282
Social skills, 93, 94
Social substantive grievance, 282
Soft HRM, 84
vs. hard HRM, 9–10
Spain, 265
Stories, 60
from hospitality entrepreneurs, 62
Stress, 266–270
control, 268
demands, 268
developing policy, 270
negative effects, 267
organizational change, 269
relationships, 268–269
role, of employees, 269
standard policy, 270
support, 268
Strong culture thesis, 63, 64
Students, 6
Superhost, 153
Swedco, 32
Sweden, 144, 265
Sydmonds, James, 235
Symbols, 58
Talking points, in appraisal, 179
Teamwork, 14
Temporal flexibility, 83
‘Them and us’ attitude, 219, 220, 231
Thomas, David, 192
Tiger Tiger, recruitment process in, 100
Tipping practice, 206–209
in different countries, 207
motives, 208
research reports, 208
Total quality management (TQM), 155,
231–232
Total Rewards System, 196, 210
Tourism sector, sub-sectors, 3–4, 5
TQM see total quality management
Trade union, 220, 221
in Australia, 226
conflict in British Airway, 227
in UK, terminal decline, 222–228
reasons, 224–225
in US, 226
Trade Union and Labour Relations
Consolidation Act 1992, 74
Trade Union Reform and Employment Rights
Act 1993, 74
Training, 141, 153
apprenticeships, 151
benefits, 154–155
conducting, 157, 163
dichotomy, 153–157
evaluating, 164
industry level, 152
instruction methods, selecting, 159–163
external, off-the-job, 162–163
in-company, off-the-job, 160–162
in-company, on-the-job, 160
investors in people, 147–150
cost, 150
levels of analysis, 143
N/SVQs, 146–147
national level responses, 142–146
national skill-creation systems, 145
needs, assessing, 158
objectives, 159
plan, 164
completion, 163
preparation, 158
Pontins training, 150
programme designing, 159
and TQM, in restaurant industry, 155
VET policies and practices, 144
Training and development, 14
Transfer of Undertaking Regulations (TUPE),
287
Transnational labour market, 72
I NDEX 304
Index-H6572.qxd 11/22/06 5:55 PM Page 304
Travel and Leisure Industry Salary Survey
(1997), 192
Troublesome employee, 288
Two-way communication, 230
UK, 5, 6, 38, 73, 74, 76, 95, 106, 121, 122, 125, 131,
143, 144, 145, 146, 203, 220, 238, 244, 252,
257, 266, 270, 271, 272
Unitary perspectives, employee relations, 219
Upward appraisal, 182
Upward problem-solving, 229, 230
US, 38, 39, 40, 62, 73, 74, 131, 135, 144, 145, 206,
207, 226, 248, 253, 265
Validity, of selection procedure
content validity, 110
face validity, 110
predictive validity, 110
Values, 41, 57, 62, 64
Virtual psychologist, 101
Visually impaired employees, responding to
needs, 129
Vocational education and training (VET),
policies and practices, 144–145
Wages Act 1986, 74
Warm fuzzies, 61
Welcome Host, 153
Welfare policies, 242, 243, 254
absence management, 243–247
AIDS/HIV, 247–252
alcohol/drug misuse, 252–256
rationales, 242–243
sexual harassment, 256–264
smoking, 264–266
stress, 266–270
working time, 270–273
workplace violence, 273–274
Wellness management, 245, 247
Women
barriers for, 117
employment experience, 116–117
Work, as leisure, 199
Working time, 270–273
of EU, 270
excessive hours, 271
of UK, 270–271
Working Time Regulation (WTR), 271–272
Workplace, 171
air rage, 273, 274
with sexual simmer, 260
violence, 273–274
Workplace Employee Relations Survey data,
172, 224
Works councils, 234–235
I NDEX 305
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doc_972171220.pdf
The importance of tourism and hospitality employment in both developed and developing countries is attested to by the World Travel and Tourism Council (WTTC), who suggest that travel- and tourism-related activities account for over 230 million jobs, or 8.7 per cent of jobs worldwide (WTTC, 2006).
HUMAN RESOURCE
MANAGEMENT FOR THE
HOSPITALITY AND
TOURISM INDUSTRIES
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HUMAN
RESOURCE
MANAGEMENT
FOR THE
HOSPITALITY
AND TOURISM
INDUSTRIES
Dennis Nickson
Deputy Head of Department, Department of Human Resource
Management, Strathclyde Business School, University
of Strathclyde, Glasgow, Scotland
AMSTERDAM • BOSTON • HEIDELBERG • LONDON • NEW YORK • OXFORD
PARIS • SAN DIEGO • SAN FRANCISCO • SINGAPORE • SYDNEY • TOKYO
Butterworth-Heinemann is an imprint of Elsevier
Prelims-H6572.qxd 11/22/06 5:48 PM Page iii
Butterworth-Heinemann is an imprint of Elsevier
Linacre House, Jordan Hill, Oxford OX2 8DP
30 Corporate Drive, Suite 400, Burlington, MA01803, USA
Copyright © 2007, Dennis Nickson. Published by Elsevier Ltd. All rights reserved
The right of Dennis Nickson to be identified as the author of this work has been asserted in
accordance with the Copyright, Designs and Patents Act 1988
No part of this publication may be reproduced, stored in a retrieval system or
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Notice
No responsibility is assumed by the publisher for any injury and/or damage to
persons or property as a matter of products liability, negligence or otherwise, or from any use or oper-
ation of any methods, products, instructions or ideas contained in the material herein.
British Library Cataloguing in Publication Data
Acatalogue record for this book is available from the British Library
Library of Congress Cataloging in Publication Data
Acatalog record for this book is available from the Library of Congress
ISBN–10: 0-7506-6572-6
ISBN–13: 978-0-7506-6572-8
Typeset by Charon Tec Ltd (AMacmillan Company), Chennai, India
www.charontec.com
Printed and bound in Great Britain by MPG Books Ltd. Bodmin, Cornwall
For information on all Butterworth-Heinemann publications visit our
web site at http://books.elsevier.com
Prelims-H6572.qxd 11/22/06 5:48 PM Page iv
Contents
List of figures ix
List of tables x
List of abbreviations xi
Preface xiii
Chapter 1 Human resource management and the tourism
and hospitality industry: An introduction 1
Introduction 2
What are the tourism and hospitality industries? 3
Who makes up the tourism and hospitality workforce?
A brief snapshot 6
What is HRM? 7
Models or reality? 15
The bad news … pessimistic views of HRM in tourism
and hospitality 17
The good news … best practice in tourism and
hospitality 20
Where this book stands 21
Conclusion 22
References and further reading 23
Websites 24
Chapter 2 International human resource management 26
Introduction 27
The emergence of IHRM 27
MNCs and HRM policies and practices in the tourism
and hospitality industry 44
Conclusion 46
References and further reading 47
Websites 49
v
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES vi
Chapter 3 Organizational culture 50
Introduction 51
In search of a definition 51
Competing views on organizational culture 53
How can we study organizational culture? 56
Organizational culture and HRM: a reprise 65
Conclusion 67
References and further reading 67
Websites 69
Chapter 4 Labour markets 70
Introduction 71
Levels of analysis in the labour market 71
The internal labour market and the utilization of
flexible labour 80
Conclusions 85
References and further reading 85
Websites 86
Chapter 5 Recruitment and selection 87
Introduction 88
Recruitment 90
Selection 104
Conclusion 111
References and further reading 111
Websites 113
Chapter 6 Equal opportunities and managing diversity 114
Introduction 115
The employment experience of socially defined
minority groups 116
The legislative response 122
Managing diversity 133
Conclusion 137
References and further reading 138
Websites 139
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Chapter 7 Training and development 141
Introduction 142
Understanding the context: national level responses
to training 142
N/SVQs 146
Investors in people 147
Apprenticeships 151
Industry level 152
Training and development: no longer a dichotomy? 153
Conducting training 157
Conclusion 164
References and further reading 165
Websites 167
Chapter 8 Performance management and performance appraisal 168
Introduction 169
The nature of performance management and
performance appraisal 170
Appraisal in practice 172
Managing poor performance 185
Conclusion 186
References and further reading 186
Websites 187
Chapter 9 Reward strategies in the tourism and hospitality
industry 188
Introduction 189
Employee and employer views of pay 189
Remuneration in tourism and hospitality 196
The practice of tipping 206
Fiddles and knock-offs 209
Other benefits 210
Conclusion 211
References and further reading 212
Websites 214
CONTENTS vii
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Chapter 10 Employee relations, involvement and participation 215
Introduction 216
Employee or industrial relations? 217
Trade unions: in terminal decline? 222
Employee involvement and participation 228
Conclusion 237
References and further reading 238
Websites 240
Chapter 11 Welfare, health and safety 241
Introduction 242
Absence management 243
AIDS/HIV 247
Alcohol/drug misuse 252
Sexual harassment 256
Smoking 264
Stress 266
Working time 270
Workplace violence 273
Conclusion 274
References and further reading 275
Websites 278
Chapter 12 Grievance and disciplinary procedures 279
Introduction 280
Setting the scene on grievance and disciplinary
procedures 280
Conclusion 290
References and further reading 291
Websites 292
Chapter 13 Concluding comments 293
References 296
Index 297
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES viii
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List of figures
1.1 The HRM cycle 16
3.1 HRM and culture: contradictions and dilemmas 66
5.1 Sources of recruitment in the hospitality industry 102
7.1 The principles of the IiP standard 149
11.1 Some negative effects of stress for the individual and organization 267
12.1 Typical disciplinary procedure 286
ix
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List of tables
2.1 A geocentric human resource profile 31
2.2 Advantages and disadvantages of using PCNs, TCNs and HCNs 34
4.1 Hotel demands variability 78
6.1 Anti-discriminatory legislation 123
6.2 Differences between managing diversity and equal opportunities 135
7.1 Levels of analysis for understanding approaches to training 143
and development
7.2 VET policies and practices in selected countries 144
8.1 Features of performance management 170
8.2 Criteria used to measure individual performance 181
9.1 How the UK NMW has evolved since 1999 204
9.2 Comparison of the level of the adult minimum wage across
selected countries, end 2004 205
10.1 Union density in selected countries 224
10.2 Direct communication and information sharing techniques 229
x
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List of abbreviations
ACAS Advisory Conciliation and Arbitration Service
AIDS Acquired Immune Deficiency Syndrome
BA British Airways
BHA British Hospitality Association
CIPD Chartered Institute of Personnel and Development
CEHR Commission for Equality and Human Rights
CRE Commission for Racial Equality
DDA Disability Discrimination Act
DRC Disability Rights Commission
DTI Department of Trade and Industry
EOC Equal Opportunities Commission
EAP Employee Assistance Programme
ET Employment Tribunal
EU European Union
EWC European Works Councils
HCN Host-Country Nationals
HIV Human Immunodeficiency Virus
HRD Human Resource Development
HRM Human Resource Management
HSE Health and Safety Executive
ICE Information and Consultation of Employees Regulations 2004
(ICE Regulations)
IDS Income Data Services
IIP Investors in People
IRS Industrial Relations Services
IHRM International Human Resource Management
JCC Joint Consultative Committees
LPC Low Pay Commission
LRD Labour Research Department
MNC Multinational Company
xi
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NMW National Minimum Wage
N/SVQ National/Scottish Vocational Qualification
PCN Parent-Country National
QC Quality Circles
RFO Race for Opportunity
RRA Race Relations Act
SSC Sector Skills Council
SDA Sex Discrimination Act
SME Small and Medium-sized Enterprise
TCN Third-Country National
TGWU Transport and General Workers Union
TQM Total Quality Management
WERS Workplace Employment Relations Survey
WTR Working Time Regulations
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES xii
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Preface
This book stems from a longstanding interest in how tourism and hospitality
organizations and managers seek to manage their employees. As a highly labour-
intensive industry, tourism and hospitality organizations are often heard to talk of
how their people are ‘their greatest asset’. However, even a cursory understanding
of the nature of work, employment and people management in tourism and hos-
pitality points to the many paradoxes and contradictions that are apparent in
studying human resource management (HRM) in the sector. This book aims to
explore some of these paradoxes and contradictions in seeking to submit the cliché
of ‘our people are our greatest asset’ to critical scrutiny. That said, the book is in
many respects a standard HRM text for the tourism and hospitality sector, recog-
nizably following the traditional concerns of organizations as to how they best
attract, maintain and develop an effective workforce.
In talking about tourism and hospitality the book is also aware of the many
debates about how the sector is best conceptualized. There are many common attrib-
utes that are associated with both hospitality and tourism activities, which could
encourage them to be seen synonymously. Equally though some would argue for dis-
tinctiveness between the two. Like most colleagues writing in this area the book
acknowledges these debates, whilst also at times rather fudging the distinction
between tourism and hospitality. In fudging what some might consider a largely
semantic debate it is important not to lose sight of the one thing that is clearly para-
mount in all organizations in tourism and hospitality: the need to deliver service to
customers and the need to manage people in such a way that they offer a quality serv-
ice. The manner though in which organizations in different countries, cultures and
market niches address this issue may vary enormously and this difference sustains
many of the concerns outlined in this book. Indeed, an appreciation of culture – and
the importance of organizational culture in particular – is a strong, and hopefully
novel, feature for a book of this nature.
In attempting to understand the importance of context to explain HRM prac-
tices this book also aims to be international in its focus and its use of sources and
examples. Thus, whilst the primary focus of the book is the UK, there are numerous
xiii
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examples from a variety of other countries across the world. The same point is also
true in terms of examples of organizational practice. A number of examples are
drawn from what is usually described as the commercial hospitality sector, which is
well served by research. Many of those activities which are more oriented towards
travel and tourism are also represented, though material of this nature is not quite so
voluminous. A further aspect of context is the need to understand the dynamic
and changing environment in which tourism and hospitality organizations operate.
Political, economic, social and technological changes significantly affect tourism and
hospitality organizations and the experience of work for those people who work in
the sector; and the book is cognizant of this point throughout. This dynamism is also
apparent with regard to emergent debates about new concepts which allow for an
appreciation of the changing nature of the employment experience of the tourism
and hospitality workforce. For example, work I have done with colleagues on aes-
thetic labour – how employees embody the tourism and hospitality product by
‘looking good’ or ‘sounding right’ – points to the manner in which organizations
increasingly take an interest in their employees’ appearance as a source of competi-
tive advantage. This book is designed to provoke thought and debate about aes-
thetic labour and a myriad of other issues and encourage the readership to challenge
its conclusions and stimulate further reading and research.
As has already been stated this book is the culmination of a longstanding interest
in the area of tourism and hospitality employment, both as teacher and researcher. In
that sense it is also an opportunity to draw on many of the ideas and writings of innu-
merable students and colleagues who have influenced my thinking. In particular, I
would very much like to acknowledge a huge debt to the work of Tom Baum, Yvonne
Guerrier, Rosemary Lucas and Roy Wood. Over the years they have given freely of
their time, advice and ideas, and shaped many of the ideas expressed in this book. I
hope this book can take its place alongside the work of my illustrious colleagues in
encouraging students and practitioners to think about how to improve the working
lives of the many who rely on tourism and hospitality for their employment.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES xiv
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Chapter 1
Human resource
management and the
tourism and hospitality
industry: An
introduction
Chapter objectives
This chapter sets the scene for the book. It considers
the nature of the tourism and hospitality industry
and some of the approaches to managing people
adopted by organizations and how these approaches
can vary. Therefore the aims of this chapter are:
? To recognize the importance of tourism and
hospitality as an employment sector.
? To outline the diverse range of sub-sectors and
occupations within the broad heading of
tourism and hospitality.
? To consider the nature of the workforce.
? To review the range of models/theories
concerned with human resource management
(HRM) and how these might be applied to the
tourism and hospitality sector.
1
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Introduction
The importance of tourism and hospitality employment in both developed and
developing countries is attested to by the World Travel and Tourism Council (WTTC),
who suggest that travel- and tourism-related activities account for over 230 million
jobs, or 8.7 per cent of jobs worldwide (WTTC, 2006). However, whilst the quantity
of jobs is unquestionable, the quality of many of these jobs is of great concern to aca-
demics and policy-makers alike. Despite the rhetoric of policy-makers and business
leaders that people are the industry’s most important asset, many remain uncon-
vinced that such a view is borne out by empirical evidence. For example, Douglas
Coupland, the notable cultural commentator, has for many captured the zeitgeist
when he talks pejoratively of ‘McJob’ which he describes as, ‘Alow-pay, low-prestige,
low-dignity, low-benefit, no-future job in the service sector. Frequently considered a
satisfying career choice by people who have never held one’ (Coupland, 1993: 5; and
see also Lindsay and McQuaid, 2004). MacDonald and Sirianni (1996) recognize the
challenges of living and working in a service society which, according to them, is
characterized by two kinds of service jobs: large numbers of low-skill, low-pay jobs
and a smaller number of high-skill, high-income jobs, with few jobs being in the
middle of these two extremes. Such a situation leads labour analysts to ask what
kinds of jobs are being produced and who is filling them. This point is also true for
the tourism and hospitality industry and it is important at the outset of this book to
add a caveat about the generalizability (or otherwise) of the conditions of tourism
and hospitality employment worldwide. Hence Baum (1995: 151) reflecting the
diversity of employment within the sector notes that:
In some geographical and sub-sector areas, tourism and hospitality provides
an attractive, high-status working environment with competitive pay and
conditions, which is in high demand in the labour force and benefits from
low staff turnover … The other side of the coin is one of poor conditions, low
pay, high staff turnover, problems in recruiting skills in a number of key
areas, a high level of labour drawn from socially disadvantaged groups, poor
status and the virtual absence of professionalism.
Organizations and managers in the tourism and hospitality industry face real chal-
lenges in recruiting, developing and maintaining a committed, competent, well-
managed and well-motivated workforce which is focused on offering a high-quality
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 2
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‘product’ to the increasingly demanding and discerning customer. This book seeks
to address some of the key human resource (HR) issues that have to be tackled in
order that organizations can maintain such an environment. To do so it will critically
review some of the problems which lead many to characterize tourism and hospital-
ity employment as generally unrewarding and unappealing, whilst also considering
examples of good practice, important policy responses and models of HRM which
may offer cause for greater optimism in the way people are managed within the
tourism and hospitality industry.
What are the tourism and hospitality industries?
Many academics, industrialists and policy-makers have attempted to define the
nature of the tourism industry – and the place of the hospitality sub-sector within
this broader conceptualization – yet there is still no one commonly accepted def-
inition. Hence, there are inherent problems seeking to define what is a large and
diverse sector, which means many of the activities may overlap, and could be
described as encompassing tourism and hospitality. For example, Lucas (2004) in
her recent work on employment relations in the hospitality and tourism industries
chose to talk in broad terms about the Hotel, Catering and Tourism Sector (HCTS).
This characterization of the HCTS recognizes that, in reality, many jobs in hospi-
tality and tourism, ‘share common attributes and are associated with both hospi-
tality and tourism activities’ (p. 4). Clearly, then, we should recognize the potential
for a lack of precision in describing the tourism and hospitality industries.
In an attempt to avoid too much imprecision and, at the same time, capture the
diversity of the sector this book uses the framework offered by People 1st, which
is the Sector Skills Council (SSC) for the hospitality, leisure, travel and tourism sector,
to exemplify the broad range of activities that may be seen in the HCTS. The reason
for using People 1st is that SSCs are the government-licensed bodies in the UK respon-
sible for improving skills within the industry. SSCs are employer led and amongst
other things aim to be the voice of industry on skills matters and encourage best prac-
tice approaches to employment (and see Chapter 7 for the role of People 1st in improv-
ing skills and training in hospitality, leisure, travel and tourism). Therefore, People 1st
suggest that the sector as a whole is made up of 14 sub-sectors (People 1st, 2006):
? hotels;
? restaurants;
HRM AND THE TOURI SM AND HOSPI TALI TY I NDUSTRY 3
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? pubs, bars and night-clubs;
? contract food service providers;
? membership clubs;
? events;
? gambling;
? travel services;
? tourist services;
? visitor attractions;
? youth hostels;
? holiday parks;
? self-catering accommodation;
? hospitality services.
Moreover within this broad classification of travel, tourism and hospitality there is
massive diversity in the types of jobs generated, in relation to their technical and
skills’ demands, educational requirements, terms and conditions and the type of
person that is likely to be attracted to employment in them. To illustrate this point
we can consider Baum’s (1997: 97–98) description of the range of people a person
buying a package holiday is likely to interact with:
? the retail travel agent;
? insurance companies;
? ground transport to and from the airport;
? at least two sets of airport handling agents (outbound and return);
? airport services (shops, food and beverage outlets, bureaux de change) (out-
bound and return);
? the airline on all legs of the journey;
? immigration and customs services;
? local ground transportation;
? the hotel or apartment;
? tour services at the destination;
? companies and individuals selling a diversity of goods and services at the des-
tination (retail, food and beverage, entertainment, cultural and heritage, financial,
etc.);
? emergency services at the destination (medical, police, legal);
? service providers on return (photography processing, medical).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 4
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Baum characterizes all of these possible intermediaries, and the interactions they
will have with the holiday maker, as crucial in ‘making or breaking the tourist
experience’. Thus while the physical product is important, for most tourists the
quality of their experience is likely to be also reliant to a large degree on the inter-
actions they will have with the variety of front-line staff in the travel, tourism and
hospitality industry. These so-called ‘moments of truth’ (Carlzon, 1987) are therefore
crucial for organizational effectiveness, success, competitiveness and profitability.
Indeed, within an industry that is characterized by diversity and heterogeneity in
terms of the purpose, size, ownership and demands of the enterprise, the only real
point of homogeneity is delivering service to customers and the need to manage
people in such a way that they offer a quality service. The corollary of this point
would be the belief that such front-line staff would therefore be sufficiently well
paid, trained and motivated to offer outstanding service. The reality however is that
often such staff have the lowest status in the organization, are the least trained, and
are the poorest paid employees of the company.
In recognizing the diversity both of the range of sub-sectors and types of jobs
they are likely to generate, this book cannot consider all of these aspects in detail.
Indeed, more is known about employment in certain sub-sectors than others. For
example, the commercial hospitality industry encompassing hotels, restaurants
and pubs, bars and nightclubs is the largest sub-sector with around 70 per cent of
employees in the UK (People 1st, 2006). Unsurprisingly, then, the commercial hos-
pitality industry is well served with extensive research on the nature of employ-
ment and HRM strategies (D’Annunzio-Green et al., 2002; Lucas, 2004). On the
other hand, little has been written on the events industry or the nature of HRM in
youth hostels, for example. As a consequence many of the examples drawn on in
this book are from the commercial hospitality industry, although, where possible,
illustrations of organizational practice from travel and tourism organizations are
also used. Ultimately, the main aim of the book is to attempt to understand the
potentially diverse employment experience of those working in what we will
broadly think of as the tourism and hospitality industries. Thus, how does the
experience of an airline flight attendant differ from that of a pot washer in the
kitchen in a small restaurant to a receptionist in the front desk of an international
hotel or to a tour rep working on an 18–30-type holiday?
Afurther issue to consider is the manner in which the sector is heterogeneous
in terms of the predominance of small- and medium-sized enterprises (SMEs).
People 1st (2006) note that within the UK hospitality, leisure, travel and tourism
HRM AND THE TOURI SM AND HOSPI TALI TY I NDUSTRY 5
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sector 76 per cent of establishments employ fewer than ten people and 50 per cent
fewer than five. Heterogeneity is also seen in relation to the way that organizations
adopt differing routes to competitive advantage, depending on which type of mar-
ket they operate in. For example, full service carriers in the airline industry are
likely to have very different approaches to HRM compared to low-cost airlines
(Eaton, 2001; Spiess and Waring, 2005). The same is true for the hospitality sector,
which may range from first class and luxury hotels providing extravagant, full
24-hour service to the more homely comforts of a bed and breakfast establishment;
from fast food restaurants to Michelin starred restaurants. In turn, the jobs pro-
vided by these various organizations demand a variety of skills and attributes
from those employees interacting with customers, which again will impact on
HR strategies such as recruitment and selection and training.
Who makes up the tourism and hospitality
workforce? A brief snapshot
The International Labour Organization (ILO, 2001) in their wide-ranging report
on the global tourism and hospitality industry provides evidence that suggests
that the industry globally is largely reliant on what Wood (1997) has described as
so-called ‘marginal workers’, such as women, young workers, casual employees,
students, relatively high numbers of part-timers and migrant workers. For example,
within the UK women make up around 58 per cent of the broader hospitality,
leisure, travel and tourism workforce (People 1st, 2006). More specifically, the hos-
pitality sub-sector is indicative of the broader sector in having a higher proportion
of part-time employees (52 per cent) than most other industries with the all indus-
try figure being 25 per cent (HtF, 2003). Young people are also prominent within
the hospitality, leisure, travel and tourism sector. For example, 37 per cent of the
total UK workforce is under 24 years and 58 per cent under 34 years (People 1st,
2006). Related to this last point a significant part of the tourism and hospitality
workforce consists of student, seasonal and migrant workers. Students are an
increasingly important segment of the labour market for hospitality and tourism
organizations (ILO, 2001). They are prepared to work for low wages and be flex-
ible in their working patterns (Canny, 2002), creating what Curtis and Lucas (2001)
describe as a ‘coincidence of needs’ between employers and students. Thus, nearly
three quarters of all students who are working are employed in the retail and
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 6
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hospitality industries and the vast majority of students who are working do so in
front-line jobs such as sales assistants, waiters/waitresses and check out operators
(Curtis and Lucas, 2001; Canny, 2002). The number of ethnic minority workers in
the broader hospitality, leisure, travel and tourism sector is 11 per cent, slightly
higher than the all industry figure of 9.6 per cent (People 1st, 2006). With regard
to qualifications only 12 per cent of employees in hospitality, leisure, travel and
tourism have a degree or equivalent compared to an all industry figure of 29 per cent,
with 15 per cent of the workforce having no qualification compared to 11 per cent
of the total workforce (People 1st, 2006).
Having briefly considered the nature of the hospitality and tourism industry and
the characteristics of its workforce attention now turns to understanding HRM
and the increasingly important role it is felt to play in organizational success.
What is HRM?
Definitions of HRM
There have been many attempts to define what exactly HRM might be and indeed
Heery and Noon (2001) recognize that it is a subject of considerable academic analy-
sis and that, ultimately, ‘there is no common agreement on what HRM means’
(p. 161). Resultantly, they offer 10 definitions, which they feel capture the com-
plexity and dynamism of HRM as a subject of academic study:
? A label HRM is seen as simply being another name for personnel management
and there is nothing distinct or special about HRM.
? A convenient shorthand term that allows for the grouping together of a whole
series of sub-disciplines that are broadly concerned with people management:
such as employee relations, industrial/labour relations, personnel management
and organizational behaviour.
Review and reflect
If you are currently working in the tourism and hospitality industry whilst completing your
studies list what you consider good and bad aspects of your job and your reasons for this.
HRM AND THE TOURI SM AND HOSPI TALI TY I NDUSTRY 7
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? A map to help guide students and practitioners to understand the concept and
ideas associated with the management of people.
? Aset of professional practices suggests that there are a range of personnel practices
that can be integrated to ensure a professional approach to managing people. In
this view a potentially key role is likely to be played by the Chartered Institute
of Personnel and Development (CIPD), which is the professional association for
those entering the HR and personnel profession.
? Amethod of ensuring internal fit again sees the need to co-ordinate approaches to
people management, but here the co-ordination needs to be with other areas of
the organization.
? Amethod of ensuring external fit where HRM activities have to be fully integrated
with the demands of the external environment.
? A competitive advantage where HRM is the means by which an organization can
gain competitive advantage, a view best captured by the cliché of ‘our people
are our greatest asset’.
? A market-driven approach in that decisions will often be market driven and the
needs of the business determine the manner in which employees are treated;
some may be treated well, others less so well.
? Amanipulative device sees it as inherently exploitative and manipulative.
? Ahologramcaptures much of the above discussion in recognizing the fluid iden-
tity of HRM and the fact that it has multiple meanings.
Clearly what the above discussion points to is that HRM means many things to
many people, depending on whether you are a manager, an employee or an aca-
demic and there is no one definition that will adequately capture the potential
complexity of the topic.
That said, for the purposes of this book we will recognize HRM as being broadly
about how organizations seek to manage their employees in the pursuit of organ-
izational success. Reflecting this point the book utilizes the concise definition
offered by Storey (1995: 5). Thus, HRM ‘is a distinctive approach to employment
management which seeks to achieve competitive advantage through the strategic
Review and reflect
Which definition do you find most persuasive and why?
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deployment of a highly committed and capable workforce, using an integrated
array of cultural, structural and personnel techniques’. The challenge of HRM then
would seem to be how to recruit, deploy, develop, reward and motivate staff, lead-
ing to them being a source of competitive advantage. As the above discussion sug-
gests, however, there is more than one route to seeking competitive advantage and
this point is further considered in examining the notion of ‘hard’ and ‘soft’ HRM.
Hard vs. soft?
As well as providing the concise definition utilized above, Storey (1987) also
provided one of the earliest and most enduring attempts to recognize different
approaches to HRM. These different approaches are captured by the idea of hard
and soft HRM, each of which are now briefly described. The hard version is seen to
be an instrumental and economically rational approach to human resource man-
agement. In this view people management strategies are driven by strategic con-
siderations to gain competitive advantage, maximizing control while achieving
the lowest possible labour cost. This approach is quantitative and calculative and
labour is a commodity/resource, the same as any other. The focus is on human
resource management. On the other hand the soft version is seen to be much more
about adopting a humanistic and developmental approach to human resource
management. As a result an organization’s people management approach is likely
to be more consensual and based on a high level of managerial commitment to
employees, which is intended to lead to mutual high commitment from employ-
ees, high trust, high productivity and so on. Employees are seen as being proac-
tive, capable of being developed and worthy of trust and collaboration. This
approach focuses on human resource management.
What hard and soft approaches to HRM point to is that employers will vary their
people management strategies. Clearly as well there are likely to be a number of
external influences as HRM in practice 1.1 suggests. These external influences will
Review and reflect
Reflecting on your answers from the first review and reflect question to what extent do
the good and bad aspects you listed equate to hard or soft aspects of HRM?
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reflect a variety of political, social, economic and technological aspects which will
have an effect on HRM policies and practices. Hard and soft HRM point to the
manner then in which organizations can vary their approaches to HRM and as a
result the impact on employees may vary. Asimilar attempt to recognize that there
may be different approaches to HRM is also seen in the debate over whether
organizations should aim to achieve ‘best fit’ or ‘best practice’.
Best fit vs. best practice?
Boxall and Purcell (2000) suggest that attempts to understand the way in which
organizations approach the management of their HR can be seen with regard to
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 10
HRM in practice 1.1 Hard and soft approaches
to HRM in the airline industry
The tourism and hospitality industry is particularly sensitive to economic cycles and political
trouble and can be badly affected in times of uncertainty. For example, the global nature of
the industry means that it is vulnerable to external events that cause fluctuations in tourist
visits and spend. The global 2001–2004 economic downturn, 9/11, the Iraq war and the
outbreak of SARS in the Far East all led to a drop in revenue in the industry. These factors
reduced the number of travellers internationally and left uncertainty and fragility in the
tourism market. Many of these aspects are particularly pronounced in the airline industry
and trade unions have often railed against the manner in which employees are used as
‘shock absorbers’ to protect the industry from the cyclical nature of the market. These hard
approaches to HRM have seen major redundancy programmes in a number of airlines in
recent years, especially after 9/11. On the other hand, a number of companies have sought
a more soft approach to HRM which aimed at increasing the customer responsiveness of
their front-line staff. British Airways, for example, had a series of initiatives in the 1980s and
1990s such as ‘Putting People First’ and ‘Winning for Customers’. Amongst other things
these initiatives sought to introduce team working, extensive training programmes,
enhance quality procedures and multi-skill staff. As companies alternate between hard and
soft approaches to HRM employees may become confused as to what the company mes-
sage is. Ultimately, employees may well be a company’s ‘greatest asset’, but in times of
uncertainty and downturn are equally expendable as recent history suggests.
Derived from Grugulis and Wilkinson (2002); ITF (2004).
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whether they aim for ‘best fit’ or ‘best practice’. On the one hand, the best fit school
argues for an approach to HRM, which is fully integrated with the specific organ-
izational and environmental context in which they operate. On the other hand,
best practice advocates argue for a universalistic approach to HRM where all firms
who adopt a range of agreed HR policies and practices are more likely to create a
high-performance/commitment workplace, as organizations aim to compete on
the basis of high quality and productivity.
Best fit
One of the earliest and most influential attempts to develop a model that recog-
nized the need for a fit between the competitive strategy and HRM was that offered
by Schuler and Jackson (1987). Schuler and Jackson developed a series of typologies
of ‘needed role behaviours’ that enabled the link between competitive strategy and
HRM practices to be made. The type of needed role behaviours within Schuler
and Jackson’s model was contingent on the overall strategies that an organization
could adopt to seek competitive advantage and the HRM approached adopted to
sustain this.
First, there is an innovation strategy, where organizations seek to develop prod-
ucts or services that are different from competitors, such that the focus here is on
companies offering something new and different. Organizations adopting this
approach seek to develop an environment where innovation is allowed to flourish.
Resultantly, the employee needed role behaviour in such a scenario is character-
ized by things like a willingness to tolerate ambiguity and unpredictability, the
need to be creative and risk taking. Given these characteristics the type of HRM
strategy flowing from this approach is based on having a large number of highly
skilled individuals who are likely to enjoy high levels of autonomy. Second, is the
quality enhancement strategy wherein firms seek to gain competitive advantage by
enhancing the product and/or service quality. The approach once again points to
certain HRM practices to support a total-quality approach. These practices include
the encouragement of feedback systems, teamwork, decision-making and respon-
sibility being an integral part of an employee’s job description and flexible job clas-
sifications. The intent of these practices is to create needed employee behaviour
such as co-operative, interdependent behaviour and commitment to the goals of
the organization. Lastly, the cost reduction strategy sees firms attempting to gain
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competitive advantage by aiming to be the lowest-cost producer within a particu-
lar market segment. The characteristics of firms seeking to pursue this strategy are
tight controls, minimization of overheads and pursuit of economies of scale, in the
pursuit of increased productivity. In following such a strategy organizations may
use higher number of part-timers, seek to simplify and measure work via nar-
rowly defined jobs that encourage specialization and efficiency, and offer short-
term results oriented appraisal. Needed employee behaviours include, repetitive
and predictable behaviour, low-risk taking activity and a high degree of comfort
with stability.
This support for the importance of HRM practices ‘fitting’ the organizations
own strategically defined market segment to create a fit between the functional areas
of marketing, operations and HRM is also seen in the work of Lashley and Taylor
(1998). Lashley and Taylor describe four basic archetypes within which tourism and
hospitality organizations can be potentially located. These archetypes are the service
factory, the service shop, mass service and professional services. These characteriza-
tions are based on the degree of customization and labour intensity involved in the
service offer, in terms of the degree of customer contact required between employees
and customers.
The service factory is relatively low labour intensity and low customization
(i.e. high standardization). The service factory is most obviously exemplified by
fast food operators, especially McDonald’s. The service shop involves more cus-
tomization, but relatively low labour intensity. The defining difference to the ser-
vice factory lies in the degree of standardization within the process. Lashley and
Taylor draw upon the example of TGI Fridays to argue that although there are
high levels of standardization in the tangible aspects of the organization, such as
the menus, layouts, décor and staff uniform, there is also some scope to customize
the customers’ eating and drinking experience. This customization is by virtue of
their more extensive menu, and more importantly, greater spontaneity and
authenticity in the intangible aspects of the service provided by front-line staff.
The next classification is mass service where service processes involve a relatively
high degree of labour intensity, though a limited amount of customization.
Lashley and Taylor assert that the Marriott hotel brand typifies a mass service
organization, as their four star offering is similar to others in relation to the tan-
gibles reflecting the highly competitive nature of the mid to upper segment of the
hotel market. As a result of this convergence of the tangibles the key lies in the
intangibles and the scope available to organizations to differentiate themselves
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on the basis of service quality. Within this process of differentiation a key role is
played by the staff via the relatively high level of contact with customers. The final
grouping is professional services where there is a high level of service to individual
customers and a high degree of labour intensity, as exemplified by hospitality
management consultants.
The key point which emerges from the work of Lashley and Taylor is the likely
relationship between the service operation type adopted by the organization and
the style of HRM which best fits it. For example, it is apparent that in the four star
hotel sector a broadly soft approach to HRM, as exemplified by high discretion in
relation to the intangibles, moral involvement and a moderate trust culture, is sug-
gested as being important to sustain a high quality, total quality management (TQM)
based approach to the service offering. At the other end of the spectrum, McDonald’s
are suggested as exemplifying a command and control style which is characterized
by things such as low discretion for employees, limited responsibility and auton-
omy, and scripted service encounters. Importantly, Lashley and Taylor (1998: 161)
see the command and control approach as being right for what McDonald’s are
aiming to offer their customers:
… the historic success of the McDonald’s organization in delivering their
market offer … is partly due to the ability to develop and maintain a close fit
between the key characteristics of the strategic drivers and actual service
delivery through utilization of an appropriate HRM style.
The key point remains that organizations in developing a certain product
market strategy then ensure that their HR policies and practices are congru-
ent and cost effective with this strategy.
Best practice
Whilst arguments for best fit advocate a close fit between competitive strategies
and HRM, those in favour of best practice approaches to HRM suggest that there
is a universal ‘one best way’ to manage people. By adopting a best practice approach
it is argued that organizations will see enhanced commitment from employees
leading to improved organizational performance, higher levels of service quality
and ultimately increases in productivity and profitability. Usually couched in terms
of ‘bundles’, the HRM practices that are offered in support of a high commitment
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and performance model are generally fairly consistent. For example, Redman and
Matthews (1998) outline a range of HR practices which are suggested as being
important to organizational strategies aimed at securing high-quality service:
? Recruitment and selection: Recruiting and selecting staff with the correct attitu-
dinal and behavioural characteristics. A range of assessments in the selection
process should be utilized to evaluate the work values, personality, interper-
sonal skills and problem-solving abilities of potential employees to assess their
‘service orientation’.
? Retention: The need to avoid the development of a ‘turnover culture’, which
may of course be particularly prevalent in tourism and hospitality. For example,
the use of ‘retention bonuses’ to influence employees to stay.
? Teamwork: The use of semi-autonomous, cross-process and multi-functional teams.
? Training and development: The need to equip operative level staff with team
working and interpersonal skills to develop their ‘service orientation’ and man-
agers with a new leadership style which encourages a move to a more facilita-
tive and coaching style of managing.
? Appraisal: Moving away from traditional top down approaches to appraisal and
supporting things such as customer evaluation, peer review, team-based per-
formance and the appraisal of managers by subordinates. Generally, all of these
performance appraisal systems should focus on the quality goals of the organ-
ization and the behaviours of employees needed to sustain these.
? Rewarding quality: A need for a much more creative system of rewards and in
particular the need for payment systems that reward employees for attaining
quality goals.
? Job security: Promises of job security are seen as an essential component of any
overall quality approach.
? Employee involvement and employee relations: By seeking greater involvement from
employees the emphasis is on offering autonomy, creativity, co-operation and
self-control in work processes. The use of educative and participative mechanisms,
such as team briefings and quality circles are allied to changes in the organization
of work which support an ‘empowered’ environment.
In simple terms best practice is likely to entail attempts to enhance the skills base
of employees through HR activities such as selective staffing, comprehensive
training and broad developmental efforts like job rotation. Additionally, it also
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encourages empowerment, participative problem-solving, teamwork as well as
performance-based incentives.
Models or reality?
Of course ideal types and academic models may not always reflect the complex
reality of what really goes on in tourism and hospitality organizations. Schuler
and Jackson, for instance, freely admit the description of their three competitive
strategies as pure types often does not reflect the reality of, for example, organiza-
tions pursuing two or more competitive strategies simultaneously. The same point
can also be made with regard to hard and soft HRM; it is not uncommon for organ-
izations to vary their approaches to employees depending on any given practice.
For example, with regard to labour flexibility the use of numerical flexibility may
well reflect fairly hard approaches to HRM, whilst functional flexibility and multi-
skilling exemplifies a much softer approach (see Chapter 4). Afurther issue is the
predominance of SMEs in tourism and hospitality. It is often suggested that their
small scale means that they are unlikely to have the necessary means to employ
the kind of HRM expertize to develop sophisticated soft approaches, for example.
Nevertheless, they are still likely to require HR policies that require at least some
thought with regard to their business circumstances.
Whilst some understanding of debate about soft and hard and best fit and best
practice are important to place HR practices within a broader theoretical context,
in reality, regardless of these various ideal types all organizations have to manage
employees on a day-to-day basis. We can illustrate this in Figure 1.1, which out-
lines the notion of an HRM cycle.
Review and reflect
Think of an organization that you are familiar with, for example where you are currently
working or one where you have spent time on placement, to what extent do their HR
practices evidence either a best fit or best practice approach? Why would you characterize
it as best fit or best practice?
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Figure 1.1 is useful in allowing us to appreciate that these broad aspects of
attracting, maintaining and developing a workforce are constant and that organ-
izations and managers, both specialist HR and line managers, are wrestling with
HR issues on a day-to-day basis. However, whilst a number of the functional aspects
of HRM are unlikely to differ, the manner in which organizations actually develop
their overall strategy will. In these circumstances models that allow for recogni-
tion of differing strategic intent in HRM are still useful in allowing us to appreci-
ate why and how companies differ in their approaches to HRM in tourism and
hospitality. It would be naïve to imagine we could talk in very broad terms about
HRM in tourism in hospitality. The reality is far too complex and as we have already
noted the employment experience for employees can vary enormously depending
on the type of organization they work in and the job or role they have within their
organizations. With this recognition we should consider the key question: so what
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 16
• Attract an effective workforce
– HR planning/labour markets
– Recruitment and selection
• Maintain an effective workforce
– Rewards and welfare
– Labour relations (e.g. the role of trade unions)
– Grievance and disciplinary procedures
• Develop an effective workforce
– Training and development
– Appraisal
Figure 1.1 The HRM cycle
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does HRM in hospitality and tourism look like? Reflecting some of our earlier
discussion of hard and soft and best fit and practice we can also crudely distin-
guish between those who argue for a pessimistic view of HRM in the sector and
those who suggest that increasingly organizations are seeking a much more pro-
gressive approach to managing their employees.
The bad news … pessimistic views of HRM in
tourism and hospitality
Generally tourism and hospitality has often struggled with negative perceptions
about employment practices and conditions and this perception has often been
matched by the reality. Keep and Mayhew (1999) for example in their review of the
skills issue in the tourism and hospitality industry suggest the industry has a num-
ber of personnel problems, including:
? generally low wages, unless skill shortages act to counter this (e.g. chefs);
? unsocial hours and shift patterns that are not family friendly;
? overrepresentation of women and ethnic minorities in low-level operative pos-
itions, with better paid, higher status and more skilled jobs filled by men, pointing
to undeveloped equal opportunities policies in the sector;
? poor or non-existent career structures and use of casualized seasonal employment;
? over reliance on informal recruitment methods;
? lack of evidence of good practice personnel/HRM practices;
? little or no trade union presence;
? high levels of labour turnover;
? difficulties in recruitment and retention of employees.
Recognizing this reality of poor employment practices, Riley et al. (2000) argue that
economics is the key determining factor for HRM policies and practices in tourism
and hospitality. Of course this point is likely to be true of any industry, but as Riley
et al. point out it carries a particular resonance in tourism and hospitality, due to the
nature of the sector. That is not to say that organizations and managers in the indus-
try are not well aware of new managerial thinking on HRM. However, they also
find themselves wrestling with ‘traditional problems’, which are underpinned by
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‘fundamental labour economic imperatives’ (p. 120). Importantly, these problems
limit managerial actions and this leads Riley et al. to argue the behaviour of managers
is determined ‘by the structures and forms under which they live’ (p. 119). This
economic imperative creates a short-term perspective on managerial decision-
making and strategy in relation to HRM, and also means that management are
more likely to deploy a weak internal labour market. An obvious impact of this is
that HRM concerns of tourism and hospitality organizations are constantly directed
to short-term responses to issues such as recruitment, selection and basic training,
rather than more long-term areas which could conceivably offer more development
and career progression for existing employees.
Another reason for continuing pessimism is the general attitude of employers
and particularly the extent to which they are willing to recognize the extent of the
HRM problem in the sector. The DfEE (2000) registers with some incredulity the
awareness of low pay, for example, existing alongside the naïve view of employers
of tourism and hospitality as a ‘good’ employing sector. Thus, although in a number
of locations labour shortages were clearly reflective of an unwillingness of employers
to offer competitive pay and terms of conditions of employment, the DfEE (2000:
35) notes how, ‘We were struck by the extent to which employers described pay and
working conditions as “reasonable” or even “good” while at the same time report-
ing extensive recruitment problems, skills gaps and labour turnover.’ This disjunc-
ture between the views of employers and employees is also noted by the ILO in a
recent report on the international tourism industry. They recognize how:
Employers’ representatives generally consider that the turnover in the indus-
try should be attributed to the essentially transient nature of part of the
workforce, namely students, young mothers and young people as a whole,
as well as the general difficulty in retaining staff. Employees, on the other
hand, frequently cite low pay as a reason for changing employment, though
a lack of career structure and benefits would appear to be of even greater
importance (ILO, 2001: 6).
This inability by industry to recognize the most glaring of issues is long standing
and can also be seen in relation to things like a degree of hostility and opposition
from the employers associations in the industry, such as the British Hospitality
Association (BHA), to governmental initiatives such as the minimum wage and
working time directive. The BHA still remains unsure of the benefits of such
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initiatives, despite support from others who argue these initiatives are likely to
have a potentially positive impact on the industry (e.g. see Lucas, 2004).
Given the above discussion it is unsurprising to see a long history of support
for the proposition that tourism and hospitality remains a poor employing sector.
From Orwell’s Down and Out in Paris and London in the 1930s to recent work by the
likes of Price (1994), Kelliher and Perrett (2001), Kelliher and Johnson (1997) and
McGunnigle and Jameson (2000), the dominant paradigm has tended to stress the
negative aspects of working in the sector. For example, McGunnigle and Jameson
surveyed a selected number of hotels from the top 50 hotel groups ranked by own-
ership of bedroom stock, which were considered to be most likely to exhibit good
practice HRM. Despite this they concluded, ‘This study suggests that there is little
adoption of HRM philosophy in corporately owned hotels in the UK sample … [and
hospitality] … has a long way to go before it can claim that it is encouraging a “cul-
ture of commitment”’ (ibid. p. 416). Similarly, Kelliher and Perrett (2001), drawing
explicitly on Schuler and Jackson’s typology, develop a case study analysis of a
‘designer restaurant’. Such a restaurant might be though of as potentially develop-
ing a more sophisticated approach to HRM as they sought to differentiate them-
selves from chain establishments such as Hard Rock Café and TGI Friday’s.
However, although the restaurant had moved to a more sophisticated approach to
HRM in areas like planning, training and development and appraisal, and osten-
sibly sought an ‘innovation’ strategy, ‘there was little real evidence that human
resources were seen as a source of competitive advantage’ (p. 434). Instead, the
HRM approaches adopted by the restaurant were much more reflective of imme-
diate environmental constraints, such as the difficulties in recruiting and retaining
staff.
In sum, any number of reasons may account for poor personnel practice in the
tourism and hospitality industry. Economic determinism, the predominance of
SMEs, a low-skills base, employer antipathy to a more progressive approach to
HRM, labour market characteristics, organizations ensuring best fit HRM prac-
tices to support a high volume, low-cost strategy; all are plausible reasons for a
view of HRM which is not necessarily premised on high-skills, high-wages and a
high-quality route to competitive advantage. That said, it would be equally wrong
to paint a wholly pessimistic picture. It was recognized earlier in the chapter that
there are also examples of good practice HRM, particularly in certain sub-sectors
of the industry and in market segments where organizations are likely to seek
differentiation on the basis of offering high-quality services.
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The good news … best practice in tourism and
hospitality
Some of the most important work to emerge in recent years on the question of the
extent of good practice in the HCTS is the work of Hoque (2000). Based on his
work on the hotel sector, he argues that arguments which portray the industry as
backward and unstrategic are now outdated, at least where larger hotel establish-
ments are concerned. Indeed, he suggests that ‘it is perhaps time researchers
stopped highlighting the example of “bad management” and branding the indus-
try as under-developed or backward, and started identifying approaches to hotel
management capable of generating high performance’ (2000: 154). The research
conducted by Hoque consists of a questionnaire-based survey of 232 hotels and a
number of follow-up interviews conducted in targeted hotels, based on the results
of the survey.
Based on this research he discusses three key issues. First, the extent to which
hotels have experimented with new approaches to HRM. Secondly, the factors that
influence HRM decision-making and whether these factors are any different in the
hotel industry compared to elsewhere. Finally, he reviewed the relationship
between HRM and performance in the hotel industry. Hoque is able to claim that,
compared to a sample of over 300 greenfield-site manufacturing establishments,
the hotels in his sample where utilizing a number of practices that were very simi-
lar to best practice. Indeed, in illustrating the manner in which academic models
can, in reality, overlap it is also worth noting that there is significant overlap
between Schuler and Jackson’s quality enhancement and innovation approaches
with much of the ‘best practice’ approaches. This point about such overlap is
further illustrated in HRM in practice 1.2.
Hoque’s work remains useful in offering a description of organizational prac-
tices that support a professional, high-quality approach to service. That said, there
are a number of criticisms that can be levelled at the research (Nickson and Wood,
2000). As Hoque himself recognizes his sample of hotels is large by industry stand-
ards, averaging 125 employees per unit compared to an industry ‘standard’ of 81
per cent of establishments employing fewer than 25 people, and thus as Hoque
(2000: 51) himself recognizes ‘patently unrepresentative of the industry as a whole’.
Furthermore his reliance on city-centre hotels with a high proportion of corporate
clients is equally unrepresentative. Lastly, the reliance on managerial voices in his
research, to the exclusion of those on the receiving end of many of the initiatives
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described (i.e. employees), may be considered an important omission. To be fair,
Hoque’s exclusive reliance on managerial voices is not unique and is shared by
much of the literature on HRM. The key point emerging from the work of the likes
of Redman and Matthews and Hoque is what good practice HRM is likely to look
like in the tourism and hospitality industry.
Where this book stands
Whilst, Boxall and Purcell (2003: 61) suggest that ‘there is quite a lot of agreement
on what constitutes “bad” or “stupid” practice’ in relation to HRM, this does not
HRM AND THE TOURI SM AND HOSPI TALI TY I NDUSTRY 21
HRM in practice 1.2 The HRM quality
enhancer hotel
The hotel in Hoque’s (2000) research, which is termed the HRM quality enhancer hotel,
employed 140 staff and was part of a large international chain. In relation to their
approach to HRM a number of practices were prominent in the hotel. Recruitment and
selection emphasized the need for employees to have an aptitude for customer care,
although this tended to be ‘spotted’ at interview rather than through psychometric or
behavioural tests. The hotel used extensive induction programmes to lessen the poten-
tial of employee turnover. The use of cross-functional teams aimed to generate co-
operation and team building and staff were encouraged to view the hotel as a unit rather
than a collection of discrete functions. Allied to this extensive multi-skilling and cross-
functional flexibility was encouraged, this ‘cross-exposure’ allowed staff to see a number
of the other parts of the hotel. There was extensive decentralization, which sought to
encourage responsible autonomy, for example through a well-understood empower-
ment scheme operating in the hotel. Consultation via a representative consultative com-
mittee allowed employees to voice their views on the running of the hotel. Further to this
consultation the hotel also operated an annual attitude survey. Employees were
appraised on a yearly basis. The appraisal system was used for succession planning and
the hotel was also working towards linking appraisal with a merit-based remuneration
system. Employees were also encouraged by a strong internal labour market which
promoted from within, whenever possible. Finally, throughout the hotel there was an
overriding emphasis on quality and the need to offer ‘outstanding customer service’.
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stop organizations often developing rather bad or stupid HR practices. As we have
already noted tourism and hospitality is likely to offer huge diversity with regard
to HRM policies and practices and it would be nice to think that these are rarely
bad or stupid. Experience equally tells us though that this is not always the case.
In recognizing this point, this book aims to develop a realistic account of how
employers in tourism and hospitality develop and implement their HRM policies
and practices and what this will mean for employees. It will certainly celebrate
good practice, but equally will not be afraid to point to bad practice. This senti-
ment points to the fact whilst best practice is something to which organizations
should aspire to, the reality is that there may be a number of constraints in achiev-
ing best practice, a point which Boxall and Purcell (2000: 199) recognize:
While all employers will benefit from avoiding the real ‘howlers’ of HRM prac-
tices that are well known for their dysfunctional or perverse consequences –
they are often constrained by industry and organizational economics from
implementing a deluxe version of best practice.
In sum, whilst all tourism and hospitality employers are, for a variety of rea-
sons, unlikely to aspire to the deluxe version of best practice they should at least
aim to avoid the real howlers as suggested by Boxall and Purcell. The remainder of
the book considers how they might do this in considering policies and practices in
a variety of organizational and occupational settings.
Conclusion
This chapter recognized the importance of tourism and hospitality as an employment
sector. The sector provides a large and diverse number of jobs and will be important
for future job creation throughout the developed and developing world. Whilst the
number of jobs produced by the tourism and hospitality industry is impressive there
are some concerns about the type of employment experience within the sector. The
nature of the labour market and the reliance on ‘marginal’ workers has led to a
number of pessimistic views of HRM practice. More upbeat accounts point to the
manner in which concerns with providing good-quality service are improving HR
practices. Underlying this debate are a number of models of HRM which provide a
framework in which to locate the strategies adopted by tourism and hospitality
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organizations. Ultimately though we have to be cautious to not over generalize the
nature of HRM in tourism and hospitality and there is a need to examine differing
practices and try to understand why these differences might exist.
References and further reading
Baum, T. (1995) Managing Human Resources in the European Hospitality and Tourism Industry – A
Strategic Approach, Chapman and Hall.
Baum, T. (1997) ‘Making or breaking the tourist experience: the role of human resource management’, in
C. Ryan (ed.) The Tourist Experience: A New Introduction, Cassell, 92–111.
Boxall, P. and Purcell, J. (2000) ‘Strategic human resource management: where have we come from and
where should we be going?’, International Journal of Management Reviews, 2(2), 183–203.
Boxall, P. and Purcell, J. (2003) Strategy and Human Resource Management, Palgrave.
Canny, A. (2002) ‘Flexible labour? The growth of student employment in the UK’, Journal of Education and
Work, 15(3), 277–301.
Carlzon, J. (1987) Moments of Truth, Ballinger.
Cheng, A. and Brown, A. (1998) ‘HRM strategies and labour turnover in the hotel industry: a comparative
study of Australia and Singapore’, International Journal of Human Resource Management, 9(1), 136–154.
Coupland, D. (1993) Generation X: Tales for an Accelerated Culture, Abacus.
Curtis, S. and Lucas, R. (2001) ‘A coincidence of needs? Employers and full-time students’, Employee
Relations, 23(1), 38–54.
D’Annunzio-Green, N., Maxwell, G. and Watson, S. (2002) Human Resource Management: International
Perspectives in Hospitality and Tourism, Continuum.
Department for Education and Employment (2000) Employers Skill Survey: Case Study Hospitality Sector, DfEE.
Eaton, J. (2001) Globalization and Human Resource Management in the Airline Industry, Ashgate.
Grugulis, I. and Wilkinson, A. (2002) ‘Managing culture at British Airways: hype, hope and reality’, Long
Range Planning 35(2), 179–194.
Heery, E. and Noon, M. (2001) A Dictionary of Human Resource Management, Oxford University Press.
Hoque, K. (2000) Human Resource Management in the Hotel Industry, Routledge.
Hospitality Training Foundation (2003) Labour Market Review 2003, HtF.
International Labour Organization (2001) Human Resource Development, Employment and Globalization
in the Hotel Catering and Tourism Sector, ILO.
International Transport Workers Federation (ITF) (2004) ‘The cuts don’t work’, available at http://www.
itfglobal.org/transport-international/ti10cuts.cfm (accessed 2 July 2006).
Jollife, L. and Farnsworth, R. (2003) ‘Seasonality in tourism employment: human resources challenges’,
International Journal of Contemporary Hospitality Management, 15(6), 312–316.
Keep, E. and Mayhew, K. (1999) The Leisure Sector (Skills Task Force Research Paper 6), DfEE.
Kelliher, C. and Johnson, K. (1997) ‘Personnel management in hotels – an update: a move to human
resource management?’, Progress in Tourism and Hospitality Research, 3, 321–331.
Kelliher, C. and Perrett, G. (2001) ‘Business strategy and approaches to HRM – a case study of new devel-
opments in the United Kingdom restaurant industry’, Personnel Review, 30(4), 421–437.
Lashley, C. and Taylor, S. (1998) ‘Hospitality retail operations types and styles in the management of human
resources’, Journal of Retailing and Consumer Services, 5(3), 153–165.
HRM AND THE TOURI SM AND HOSPI TALI TY I NDUSTRY 23
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Lindsay, C. and McQuaid, R. W. (2004) ‘Avoiding the “McJobs”: unemployed job seekers and attitudes to
service work’, Work, Employment and Society, 18(2), 297–319.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
MacDonald, C. and Sirianni, C. (1996) Working in the Service Society, Temple University Press.
Marchington, M. and Grugulis, I. (2000) ‘“Best practice” human resource management: perfect
opportunity or dangerous illusion?’, International Journal of Human Resource Management, 11(6),
1104–1124.
McGunnigle, P. and Jameson, S. (2000) ‘HRM in UK hotels: a focus on commitment’, Employee Relations,
22(4), 403–422.
Nickson, D. and Wood, R. C. (2000) ‘HRM in the hotel industry: a comment and response’, Human
Resource Management Journal, 10(4), 88–90.
Nickson, D., Baum, T., Losekoot, E. et al. (2002) Skills, Organizational Performance and Economic Activity
in the Hospitality Industry: A Literature Review, Universities of Oxford and Warwick: SKOPE.
People 1st (2006) Skills Needs Assessment, People 1st.
Price, L. (1994) ‘Poor personnel practice in the hotel and catering industry – does it matter?’, Human
Resource Management Journal, 4(4), 44–62.
Redman, T. and Matthews, B. (1998) ‘Service quality and human resource management: a review and
research agenda’, Personnel Review, 27(1), 57–77.
Riley, M., Gore, J. and Kelliher, C. (2000) ‘Economic determinism and human resource management prac-
tice in the hospitality and tourism industry’, Tourism and Hospitality Research, 2(2), 118–128.
Schuler, R. and Jackson, S. (1987) ‘Linking competitive strategy with human resource management’, The
Academy of Management Executive, 1(3), 207–219.
Spiess, L. and Waring, P. (2005) ‘Emotional and aesthetic labour: cost minimization and the labour process
in the Asia Pacific airline industry’, Employee Relations, 27(2), 193–207.
Storey, J. (1987) ‘Developments in the management of human resources: an interim report’, Warwick
Papers in Industrial Relations, 17, IRRU.
Storey, J. (1995) ‘Human resource management: still marching on, or marching out?’, in J. Storey (ed.)
Human Resource Management: A Critical Text, Routledge, 3–32.
Vaughan, E. (1994) ‘The trail between sense and sentiment: a reflection on the language of HRM’, Journal
of General Management, 19(3), 20–32.
Wood, R. C. (1997) Working in Hotels and Catering, International Thomson Press, 2nd edition.
World Travel and Tourism Council (WTTC) (2006) Travel and Tourism Climbing New Heights: The 2006
Travel and Tourism Economic Research, at http://www.wttc.org/2006TSA/pdf/Executive%20Summary%
202006.pdf (accessed 1 July 2006).
Websites
The Chartered Institute of Personnel and Development (CIPD) is the main professional body for HRM prac-
titioners in the UK. There website can be found at http://www.cipd.co.uk/default.cipd and includes a
number of downloadable items for non-members.
http:///www.hrmguide.co.uk/is a very good general guide to HRM issues in the UK. Within the site there is
also links to HRM issues and practices in a range of other countries including Australia and the US.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 24
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The International Labour Organization produced a very comprehensive report in 2001 on HR issues in global
tourism and hospitality and this can be found at: http:///www.ilo.org/public/english/dialogue/sector/techmeet/
tmhct01/tmhct-r.pdf
The Work Foundation (formerly the Industrial Society) has some interesting material on their site at
http://www.theworkfoundation.com/index.aspx
Caterer and Hotelkeeper is the trade magazine for the hospitality industry and has a search engine at
http:/ //www.caterersearch.com/Home/Default.aspx. The archive has numerous stories on aspects of HRM in
the sector.
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Chapter 2
International human
resource management
Chapter objectives
As tourism and hospitality organizations
increasingly internationalize they face a number
of challenges in managing their human resources.
This chapter considers these challenges and
specifically the aims of the chapter are:
? To consider the nature of international human
resource management (IHRM).
? To outline and discuss different strategic
dispositions to internationalization.
? To appreciate the importance of a multinational
company’s (MNC’s) country-of-origin and the
effects of host countries on HRM policy and
practice.
? To assess challenges facing MNCs operating
in the tourism and hospitality industry in
attempting to transfer HRM practices across
national boundaries.
26
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 27
Introduction
The continuing growth of world markets, increased availability of management
and technological know-how in different countries, advances in telecommunica-
tions, and greater regional political and economic integration are just some of the
factors that are increasingly leading to the globalization of many tourism and hos-
pitality MNCs. Resultantly, the contemporary tourism and hospitality industry is
increasingly global and this is important in a number of ways. As more and more
tourism and hospitality MNCs are now selling their products outside their home
countries they face a number of issues in terms of how they approach a range of
HRM issues. For example, to what extent will they try to transfer policies and
practices that are successful in the home country to host countries? In thinking
about the mix between parent country and local managers, how will they staff
their units overseas? The globalization of business is making it increasingly impor-
tant to understand how multinational enterprises can operate more effectively in
seeking to answer these types of questions. As they cross national boundaries
tourism and hospitality MNCs face many challenges related to issues like: lan-
guage, culture, economic and political systems, legislative frameworks, manage-
ment styles and conventions. To assess some of these issues the chapter will
consider the emergence of IHRM; and relatedly the issue of comparative HRM. In
many respects the former aspect is largely concerned with how MNCs manage
their geographically dispersed workforce. The latter aspect is more about why and
in what ways HR practices and policies may differ in a variety of different coun-
tries. Of course, these two aspects are very much intertwined. For example, MNCs
may attempt to transfer certain HRM practices and this process may be success-
fully achieved in certain countries and be much more problematic in others, the
chapter will seek to assess why this might be the case.
The emergence of IHRM
We should begin by firstly defining what IHRM is. Torrington (1994: 6) suggests
that, ‘In many ways IHRM is simply HRM on a larger scale; the strategic consid-
erations are more complex and the operational units more varied, needing co-
ordination across more barriers’. Aslightly different view is offered by Schuler et al.
(1993: 720), who define IHRM as, ‘human resource management issues, functions,
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 28
and policies and practices that result from the strategic activities of multinational
enterprises and that impact on the international concerns and goals of those enter-
prises’. In a similar vein Boxall (1995: 5) also locates the locus of IHRM primarily
within the choices faced by MNCs, and sees it as being, ‘concerned with the HR
problems of multinational firms in foreign subsidiaries (such as expatriate man-
agement) or, more broadly, with the unfolding HR issues that are associated with
the various stages of the internationalization process’. Thus, on the basis of these
definitions it can be seen that, compared to domestic HRM, IHRM is likely to
involve the MNC in more diverse activities, greater involvement in employees pri-
vate lives (e.g. the impact of the expatriation cycle), greater risk exposure, more
external influences and generally greater complexity than would be found man-
aging domestically. Most obviously these issues can be seen in terms of how
MNCs seek to co-ordinate and integrate a range of units throughout the world,
leading Schuler et al. (1993: 719) to ask a crucial question: ‘Can MNCs link their
globally dispersed units through HR policies and practices, and if so, how?’ In
many respects any attempt to answer this question can be found in the seminal
work of Howard Perlmutter.
Perlmutter: the ‘father’ of IHRM
Harzing (2004) is representative of much of the IHRM literature which suggests
that the typology outlined by Perlmutter (1969) is crucial in attempts to character-
ize the approach adopted by MNCs not only to HRM, but also finance and account-
ing, marketing and production. Indeed, Mayrhofer and Brewster (1996) recognize
how Perlmutter’s typology has become a virtual synonym of analytical approaches
to understanding IHRM, such that they talk of his role as the originator and ‘father’
of the discipline.
Perlmutter’s (1969) work attempts to delineate differing orientations, or
strategic dispositions, adopted by multinational organizations with his starting
point being that claims to multinationality should be based on more than simply
generating sales overseas. Consequently Perlmutter outlines an ethnocentric
approach which is home-country oriented, a polycentric approach which is host-
country oriented and a geocentric approach which is world-oriented (a further
orientation of regiocentric, i.e. regionally oriented, was added in 1979 by Perlmutter
and Heenan). In general, the ethnocentric strategy suggests that companies should
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 29
maximize their parent company control to integrate subsidiaries, at the cost of
local responsiveness. Resultantly the ethnocentrically oriented MNC believes in
the superiority of the way of doing things in the home country and this informs
their strategies for staffing and managing overseas units. Therefore this approach
implies centralized systems with authority high at headquarters with much com-
munication in the form of orders, commands and advice. Managers of the home
country of the parent company are, therefore, recruited, trained and developed for
key positions anywhere in the world to ensure that the home country approach is
easily transferred and that host-country nationals (HCNs) fully understand the
headquarters culture. The polycentric approach allows for more local responsive-
ness and is premised on the view that the MNC should respond to prevailing local
conditions where practicable. Hence, in this orientation local people know best
and organizations thus seek to pursue an approach of localizing operations as
quickly as possible. Local staff are employed in core positions in the host country
and enjoy high levels of autonomy and local opportunities for further promotion.
The final orientation of geocentrism is, as Caligiuri and Stroh (1995: 497) note,
‘When MNCs desire an integration of all of their foreign subsidiaries and the
melding of a worldwide corporate culture’. Consequently organizations seek
‘the best man (sic), regardless of nationality, to solve the problems anywhere in the
world’ (Perlmutter, 1969: 13). The geocentric approach envisages competitive
advantage emanating from the organization’s ability to draw on a rich array of
national and cultural perspectives, allowing for a global strategy which is also
respectful of local circumstances – the notion of ‘think global act local’.
Which of these approaches an international organization could be character-
ized by is dependent on attitudes inferred from ‘the assumptions upon which key
product, functional and geographical decisions were made’ (ibid.: 11). Importantly
though, Perlmutter feels that, ‘There is some degree of ethnocentricity, polycen-
tricity or geocentricity in all firms’ (ibid.: 11), and it is thus unlikely that any of
these orientations are ever found in pure form. Nonetheless Perlmutter argues
strongly that one predominant disposition can usually be discerned, with Pauuwe
and Dewe (1995: 84) suggesting that any dominant attitude or state of mind of the
corporation is likely to be ‘determined by the phase of internationalization in
which the company finds itself and by its history’. The implicit sense of an evolu-
tionary approach to internationalization is a clear and important theme of
Perlmutter’s work and equally clear is his recognition of the difficulties and com-
plexity of attaining the most advanced form of the ‘ideal’ geocentric approach,
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such that ‘The route to pervasive geocentric thinking is long and torturous’ (1969:
16). This view that the most developed form for the MNC is the geocentric ‘ideal’
is something now routinely supported in much of the international business and
management literature, as exemplified by Caligiuri and Stroh (1995: 495) who sug-
gest that the geocentric strategy is:
… the ‘ideal’, as it attempts to balance both global integration and local
responsiveness. In a hierarchy, the geocentric strategy would be the best
because it incorporates both of the theoretical ideals. Polycentric and regio-
centric strategies would be second because they satisfy the local responsive-
ness ideal (usually at the cost of global integration). Ethnocentric strategies,
focusing on headquarters control are neither globally integrated nor locally
responsive.
Ashift to a global orientation is likely to be dependent on the organization having
the wherewithal to create and appoint a pool of genuinely ‘global’ managers, assum-
ing this is in fact possible. This approach requires a sophisticated HR planning sys-
tem and training infrastructure to enable an organization to enact such a strategy.
Some of the issues engendered by this discussion are identified in Table 2.1, which
suggests some of the implications for organizations which wish to pursue a geocen-
tric HRM strategy.
The impact of centricity in the tourism and hospitality industry
Roper et al. (1997, 1998) examine the factors that influence and determine success for
international hotel groups in the global market place. They argue that centricity –
defined by them as an approach to international management – is one of the key
factors that influence all business decisions and their subsequent successful imple-
mentation. Consequently they examine the possible causal relationship between
centricity and organizational success and particularly whether organizations
should be seeking to move to the geocentric ‘ideal’. Interestingly they disaggregate
centricity at a number of levels both in terms of orientation and functional areas of
management. First, they suggest that centricity can be viewed from three interre-
lated perspectives: management’s mind set and the attitudes and beliefs of key
senior managers in the organization; corporate strategic predisposition and the
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 31
way this will shape the company’s mission, governance structure, strategy, organ-
ization structure and organizational culture; and finally, subsidiary level predilec-
tion. Of these, Roper et al. suggest that the first two have the most influence,
particularly in the way that management attitudes and beliefs will inform and dic-
tate strategic and operating decisions.
Nickson (1999) reports research from three pseudonymous tourism and hospi-
tality companies, Americo, Frenco and Swedco. Using Perlmutter’s framework the
three companies evidenced differing orientations, as outlined in HRM in practice 2.1.
Review and reflect
What are some of the likely advantages and disadvantages of companies pursuing an
ethnocentric, polycentric or geocentric approach to internationalization?
Table 2.1 A geocentric human resource profile
Organization Key decision makers from diverse backgrounds operating
on a global basis.
Company culture Integrated and draws on experiences, attitudes and
beliefs held by people from different countries.
Recruitment Based on ability rather than nationality. Recruits drawn
from a range of different countries to core positions.
Training and development Managers from all countries treated as equal. People
developed through a range of overseas assignments and
drawn together in cross-cultural teams to learn from each
other.
Terms and conditions General principles adopted which draw on practice from
around the globe yet also allow for a response to local
circumstances.
Employee relations General principles adopted which draw on best practice
from different countries. European Works Council,
international committees/task groups, etc. may be
established.
Source: Roper et al. (1997: 381) Reprinted by permission of the author.
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 32
International staffing
Afurther key issue in IHRM is the way in which MNCs seek to staff their overseas
unit. Contingent upon the predominant headquarters orientation – as based on
Perlmutter’s typology – MNCs are likely to use a mix of parent-country nationals
(PCNs), third-country nationals (TCNs) and host-country nationals (HCNs). For
example, MNCs may utilize PCNs in the early days of an overseas unit’s existence,
but over time it is likelier that TCNs and particularly HCNs will play an ever
HRM in practice 2.1 Orientations in the
global hotel industry
Americo was an American company who had internationalized relatively recently. The
company was now undergoing a fairly rapid process of internationalization and seeking
a more global orientation. Americo seemed to have a control-oriented ethnocentric
approach to internationalization, with use of American expatriates or long-standing
‘Americanized’ Americo people in key positions, such as general manager. Control was
further enhanced by the use of ‘task forces’ to transfer the corporate message. There
was some evidence of the beginnings of attempts to aspire to a more global outlook, for
example, by the use of well-known consultants and academics who were working with
the company to encourage a less Amerocentric view.
Frenco was a major travel and tourism multinational who were seeking a more global
orientation. The Frenco corporate culture was used as a unifying mechanism across the
company, as the organization attempted to sustain a broadly geocentric approach.
Nonetheless, there was some evidence of post- or neo-colonialism in use of French expa-
triates in certain parts of the world. Attempts to sustain a ‘global’ approach were facilitated
by the movement of a cadre of ‘global’ managers across brands/countries. Many of these
managers also attended Frenco’s corporate university which attempted with some success
to encourage a more global outlook.
Swedco was a relatively small MNC with a small presence outside of Scandinavia.
Generally Swedco were seeking a control-oriented ethnocentric approach facilitated by
Swedish or Danish expatriate managers in pivotal positions in overseas units. The com-
pany seemed largely successful in their attempts to transfer the ‘Swedco Way’, the com-
pany’s core corporate culture, though there was some scepticism in the only unit in the
UK with a non-Scandinavian/Swedish manager.
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 33
greater role. Consequently organizations are likely to see a range of advantages
and disadvantages of the utilization of PCNs, HCNs or TCNs and these are con-
sidered in Table 2.2.
International organizations would usually have three broad motives for send-
ing managers abroad. The first one of those is to fill positions, when HCNs are
unavailable or difficult to train. Although in a more control-oriented ethnocentric
approach, PCNs or suitably socialized TCNs may be sent to maintain control due
to them knowing the organizational ‘rules’ and culture better, thus allowing them
to make the ‘right’ kind of decisions. Second, organizations may seek to develop
managers with long-term potential by giving them valuable international experi-
ence, which is likely to enhance their standing in the organization. Such transfers
may occur even when suitably qualified HCNs exist. Lastly, there may be attempts
to develop a more geocentric approach, whereby control is achieved by accultura-
tion, socialization and interaction among managers of different nationalities, with
the intent of creating a ‘global’ corporate culture, which de-emphasizes national
cultures, and a cadre of managers able to disseminate such an approach. The idea
would be that managers would become less ethnocentric if they were to come into
contact with a variety of cultures and different cultural perspectives.
The role of international managers in tourism and hospitality
Gliatis and Guerrier (1994) report on research conducted with a small sample
of expatriate managers. The research was based on interviews conducted in
four large international hotel companies with seven personnel specialists and
eight hotel managers (all from different countries and interestingly all male), on
assignments outside their home country. The research was carried out in the
UK and in Greece and sought to answer several key questions (Gliatis and Guerrier,
1994: 230):
? Why and how do hotel chains use international assignments for managers?
? When would they seek to fill a post with an expatriate manager and when with
a local manager?
? How is the use of expatriates changing?
? What problems do they perceive in their use of international transfers?
? What type of person is attracted to an international career?
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 34
Table 2.2 Advantages and disadvantages of using PCNs, TCNs and HCNs
Advantage Disadvantage
PCNs Familiarity with the home offices Difficulties in adapting to the foreign
goals, objectives, policies and practices language and the socio-economic,
political, cultural and legal environment
Technical and managerial competence Excessive cost of selecting, training
and maintaining expatriate managers
and their families abroad
Effective liaison and communication The host countries’ insistence on
with home-office personnel localising operations and promoting
local nationals
Easier exercise of control over the Family adjustment problems
subsidiary operation
HCNs Familiarity with the socio-economic, Difficulties in exercising effective control
political and legal environment and with over the subsidiaries operation
business practices in the host country
Lower costs incurred in hiring HCNs Communication difficulties in dealing
with home-office personnel
Provides opportunities for advancement Lack of opportunities for home
of local nationals and, therefore, country’s nationals to gain
increases motivation and commitment international and cross-cultural experience
Responsive to demands for localization
of subsidiary operation
TCNs Perhaps the best compromise between Host countries’ sensitivity with respect to
securing needed technical and nationals of specific countries
managerial expertise and adapting to a
foreign socio-economic and cultural
environment
TCNs are usually career international Local nationals are impeded in their
business managers efforts to upgrade their own ranks
and assume responsible positions in
the multinational subsidiaries
TCNs may be better informed about
the host environment than PCNs
Source: Harzing (2004a: 254) Reprinted by permission of Sage Publications Ltd from Wil-Harzing A. and
Van Ruysseveldt, J. International Human Resource Management, Copyright (Sage, 2004).
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? What do managers who follow international career paths perceive they gain
from this type of career path?
? What do they perceive as their main problems?
The main focus of this research was why expatriate managers fail, although Gliatis
and Guerrier do tangentially address wider questions on organizational strategy
towards crossing national boundaries. They suggest that companies would ordi-
narily see the rationale for expatriation as comprising three main reasons. The first
of these is to solve specific staffing problems in a particular location, for example,
a lack of suitably qualified personnel. The second is as part of a management
development process, thus managers would benefit from the exposure to a range
of countries, cultures and international issues. The final reason would be as a
process of organizational development, whereby transfers are seen as encouraging
global co-ordination, integration and commitment to the company. A further ele-
ment to this may also be more control-oriented, in the sense that organizations will
seek to integrate via the use of (usually home country) expatriate managers to
spread the co-ordinating ‘glue’ of corporate culture to ensure that organizational
practices and policies are ‘correctly’ followed. As a result of the research Gliatis
and Guerrier also added a fourth reason as suggested by the personnel specialists,
namely the use of expatriation as a tool for motivating and retaining managers
within a company. Gliatis and Guerrier found evidence of all of these strategies in
their research and also found that expatriation tended to be more appropriate for
operational roles, such as general manager, resident manager, food and beverage
manager and rooms division manager, whilst locals would ordinarily fill the posi-
tions of personnel managers, financial managers and chief engineers due to their
local expertise.
D’Annunzio-Green (1997) reporting on research within five international
tourism and hospitality organizations – representing the airline, fast food and
hotel sector – suggests that her case study organizations were largely pursuing
a geocentric or polycentric approach. Her work is useful both in its reporting of
the research but also in terms of its contextual discussion of how organiza-
tions approach international management development (IMD). An organization
which aspires to a more global outlook faces a number of issues in terms of approaches
adopted to things such as: international career pathing, organizations developing
international managers, adaptability of employees to new cultures and language
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and the effect of training and adaptation. MNCs intending to pursue a geocentric
approach must address a number of questions, these being:
? Is there a constant supply of mobile staff?
? Can they be released on time from existing positions?
? Is there a database advanced enough to manage a geocentric approach to train-
ing and development?
? Is the company willing to invest the time and money required to ensure such a
system will operate effectively?
As D’Annunzio-Green (1997: 200) suggests, ‘For organizations wishing to develop
a truly international manager, there needs to be a major transformation in mana-
gerial careers and development opportunities to enable the acquisition of the skills,
knowledge and experience needed to work in a global market place’.
Based on findings from a self-completed postal questionnaire sent to the sen-
ior human resources specialist within the organizations, D’Annunzio-Green found
that three of the organizations in her research were pursuing a geocentric
approach, with the other two being characterized respectively as polycentric/geo-
centric and geocentric to regiocentric. The questionnaire was followed up with in-
depth interviews with the HR director in three of the organizations and this allows
D’Annunzio-Green to add more detail as to why the organizations are character-
ized in such a way. For example, in a British-owned airline company, which is con-
ceptualized as shifting from an ethnocentric to a geocentric approach, a key role is
increasingly played by HCNs and TCNs and all of the 30–40 graduates taken on to
the company’s management training scheme had to undertake a number of inter-
national postings during their training period. Allied to this approach the com-
pany also had a sophisticated database to track career moves and mechanisms to
ensure all vacancies worldwide were notified to company personnel.
Similarly, an American-owned hotel MNC communicated all international
postings via a computerized personnel database. This company, also considered
geocentric and committed in the words of the company themselves to ‘“develop-
ing truly international managers”’ (ibid.: 204), selected international managers on
the basis of good performance appraisals, a minimum of 5 years with the company
and language proficiency in at least two languages. Additionally the selection cri-
teria was also based on adaptability, international background and a high level of
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mobility. The common strand of a sophisticated computerized global transfer sys-
tem was also found in the final organization, a Japanese-owned hotel MNC. Again
this company was considered geocentric and as part of their IMD had a 10-year
training and development plan which culminates in a general manager’s position.
During this time the candidates, who theoretically could come from any country,
would undertake a part-time MBA and placements in at least three countries to
encourage mobility, cultural empathy and global business awareness.
In sum, Gliatis and Guerrier’s and D’Annunzio-Green’s work is useful in pointing
to the likelihood of organizations within the tourism and hospitality sector adopt-
ing different approaches to internationalization and their utilization of interna-
tional managers. In particular, the attempt by D’Annunzio-Green to add greater
detail as to what may denote a geocentric approach is useful in suggesting a range
of organizational practices and policies which appear crucial in facilitating such an
approach.
Much of what we have been discussing to date has largely been about the
manner in which MNC companies seek to develop their overall orientation and
the implications of such an approach with regard to international staffing. Beyond
this focus, there is also a need to consider the broader aspect of comparative HRM,
which is more concerned as to why certain HRM practices may differ from coun-
try to country. To begin to discuss this we should recognize the importance of the
country-of-origin of MNCs.
Country-of-origin
Ferner (1997) provides a review of the country-of-origin literature and some of the
substantive issues engendered by this work. From the relatively small body of
research examining the country-of-origin effect, Ferner believes that two impor-
tant generalizations can be extrapolated.
Review and reflect
What are some of the key skills needed to be a successful expatriate manager in the
international tourism and hospitality industry?
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The first generalization is that the literature provides support for the notion
that the nationality of ownership is a significant determinant of MNC behaviour
and thus any examination of MNCs strategies should take cognizance of the
national economic and business cultures out of which they emerged. An example
of this would be the proposition that American and Japanese MNCs have in the
past tended to be more ethnocentric and reliant on expatriate managers to ensure
organizational practices and polices are ‘correctly’ followed. Therefore this ‘impe-
rial’ approach was concerned with close control over foreign subsidiaries and led
to greater formalization and centralization and a reliance on formal systems, poli-
cies and standards to manage human resources globally.
Afurther interesting aspect identified by Ferner (1997) is whether it is sensible
to characterize, as an example, differences between Japanese and British MNCs as
being due to some inherent quality of ‘Japaneseness’ or ‘Britishness’, or whether
such differences stem from other factors, such as stage of internationalization, cor-
porate structure and proportion of units represented overseas. Furthermore the
implications of national specificity would seem to preclude any real possibility of
either a literal or even figurative ‘stateless’ organization, reflecting Van Maanen
and Laurent’s (1993: 283) view that ‘All MNCs bear something of a cultural stamp
that originates in the society where the organization was first designed’ (see also
Hu, 1992). Therefore, as Ferner (1997) cogently agues even if the home country
does not provide the bulk of sales, operations and employment, in reality it is
likely to play a highly significant role in relation to locus of ownership and control,
staffing of board and senior positions, strategic decisions emanating from the
home country and also in the location of innovative activities such as research and
development. Given Ferner’s support for the notion of an MNC’s entrenched root-
edness to a national economic and business culture it is unsurprising to find him
asking the question of ‘what features do they “absorb” from the national back-
ground?’ (ibid.: 24).
In answer to that question the second generalization is that the extent of the
possible national influence on MNC behaviour is contingent upon the issues
under consideration. Consequently nationality manifests itself more in relation to
some issues than others. For example, industrial relations practices are more likely
to resemble the practices of the local environment. These considerations are also
closely related to the convergence/divergence debate, and the extent to which the
forces of convergence may be subverting national differences. At its broadest macro-
social level, convergence theory is a recognition of the influence of over-arching
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 39
trajectories and logic of capitalist development. This socio-structural argument
suggests that societies and organizations will increasingly come to resemble each
other as they accept the inevitability of universalistic tendencies in relation to tech-
nology, economic development, industrial policies, management style and HR
practices. Consequently, over time a universal type of business organization will
emerge and management practices and organizational performance would be
shaped by the ‘logic of industrialization’ and technological change, rather than
cultural or environmental variables. Within this process a key role will be played
by MNCs who act as carriers of ‘best practice’ across national boundaries.
Clearly a key role in this process is ascribed to MNCs and this raises the inter-
esting spectre of MNCs acting as forces for convergence around the practices of the
most ‘successful’ national business regimes. In essence this means that nationally
specific versions of capitalism emerge to be disseminated by the hegemonic coun-
try’s multinationals (Smith and Meiksins, 1995). There is still much support for the
notion that the US continues to be the predominant source of what are considered
‘good practice’ approaches to both general business management and, more par-
ticularly, HRM. Brewster (1995: 207), for example, argues that ‘the analyses and
prescriptions laid out in the standard management textbooks are, fundamentally,
drawn from one particular culture: that of the USA’. Guest (1990: 377) also makes
a clear connection between HRM and the ‘American Dream’:
The growth of HRM in the UK clearly owes something to the political, eco-
nomic and business climate of the 1980s and the tendency during the decade
to look to the United States as a model of good practice in all these fields.
American multinationals have been to the forefront of HRM innovation in
the UK and the leading advocates are all American.
Branine (1994) makes the cogent point that it is much more likely that non-
American managers would adopt American management styles or techniques,
whilst at the same time suggesting it is difficult to envisage American managers
adopting policies that were originally from, for example, Mexico, Fiji or Peru. The
important point then is the applicability and transferability of the putatively
American approach to management and whether there may be an enduring
American influence on any convergent tendencies if HRM is to be the new model
for managing organizations throughout the world (and see HRM in practice 2.2).
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HRM in practice 2.2 American dominance
of global economy and the international
hotel industry
Many writers argue that there are three key dimensions underpinning the process of glob-
alization, these being economic, political and cultural. It is also often argued that global-
ization is, in reality, better conceptualized as Americanization. With regard to economics a
key aspect is the rise of the multinational firm. By the early twentieth century US firms were
becoming more important players in the international economy, beginning to eclipse their
established European competitors. During the Second World War and into the post-war
period, US firms were in a position to exploit, by trade and with foreign direct investment
(FDI), firstly the inadequacies and then the decline in European manufacturing capacity,
aided of course by Marshall Aid and US Government desires to create bulwarks against
communism in Europe and Asia – Pax Americana. During this time American management
methods were vigorously exported through FDI, and education and training institutions in
Europe. With regard to politics, and particularly global governance, many argue that it is
the US particularly and to a lesser extent the industrialized countries of the European Union
which drive the operations and policies of institutions such as the World Bank, International
Monetary Fund and the World Trade Organization. Finally, there appears to be a growing
passion around the world for all things American and few things reflect American culture
better than the likes of Coca-Cola, Disney and McDonald’s, who seem to embody
Americana. A number of these aspects are seen in the history of hotel internationalization,
which was initially attributed to Conrad Hilton. He sought to place his ‘little Americas’
across the globe, leading many to talk of Hilton in venerable terms as the ‘founder’ of inter-
nationalization in the hotel industry. As well as explicitly offering a challenge to commu-
nism, many of the operating standards and procedures established by Hilton and other
pioneering American hotel chains are still apparent today. This dominance can be seen with
regard to aspects of the ‘hardware’, that is the physical product; but importantly also the
‘software’, that is the management of people. This software increasingly aims to support
high quality approaches to service via aspects such as empowerment.
Source: Nickson and Warhurst (2001).
Review and reflect
Does the American dominance of the globalization process mean that we are all increasingly
‘Americanized’?
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Country-of-operation
However strong the country-of-origin effect it is likely that units of MNCs in over-
seas locations will be influenced, to a greater or lesser extent, by what Ferner (1994:
92) has termed ‘the host-country effect’. This effect is likely to be manifested in one
of two ways, namely, the ‘culturalist’ perspective and the ‘institutionalist’ per-
spective (Olie, 1995).
The importance of culture in IHRM
The ‘softer’ culturalist perspective draws attention to cultural distinctiveness in
terms of the differing values, ideas and beliefs shared by people within any given
society. These aspects will then be taken into the organizational setting and uniquely
influence individuals workplace behaviour. Tayeb (1994) suggests that the cultural-
ist perspective is important primarily due to three reasons. First, it recognizes the
differences of cultural norms, values and attitudes from one society to another, such
that peoples’ thinking is likely to be shaped by what is considered appropriate
behaviour within that society. Second, different cultural groups will behave differ-
ently under similar circumstances because of the differences in their underlying val-
ues and attitudes. Lastly, culture will play a major part in shaping social institutions,
work organizations, managerial behaviour and personnel policies.
It is important to recognize that culture remains an essentially vague and
contested concept with literally hundreds of definitions. Equally though many
have attempted to research the impact between culture and workplace behaviour,
with one of the most famous writers in this area being Geert Hofstede. Hofstede
(1980, 2001) studied 117000 IBM staff across more than 50 countries and identified
the following four basic dimensions which describe the differences of national
culture:
? Power distance: This is the extent to which inequalities among people are seen as
normal. This dimension stretches from equal relations being seen as normal to
wide inequalities being viewed as normal. Where high power distance exists
there may well be a very clear hierarchy and managers would be expected to
manage and direct subordinates. Cultures with low power distance are likely to
be more consensual, with employees expecting to be consulted in decision-
making.
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? Uncertainty avoidance: This refers to a preference for structured situations vs.
unstructured situations. This dimension runs from being comfortable with flex-
ibility and ambiguity to a need for extremely rigid and certain situations.
Cultures with high uncertainty avoidance would prefer clear rules, whilst low
uncertainty avoidance cultures would be more comfortable working with few
rules.
? Individualism: This examines whether individuals are used to acting as individ-
uals or as part of cohesive groups. This dimension ranges from collectivism to
individualism. In individualistic cultures there is likely to be a desire to work
independently. In contrast in collectivist cultures there is likely to be a greater
preference to work with others or in groups.
? Masculinity: Hofstede distinguishes between ‘hard’ or ‘masculine’ values, such
as assertiveness and competition and ‘soft’ or ‘feminine’ values of personal rela-
tions, quality of life and caring for others. In masculine cultures work is valued
as a central life interest. By comparison feminine cultures are more likely to
stress the value of social rewards.
Based on these dimensions, and a later dimension of time and whether cultures
have a long-term vs. a short-term orientation, Hofstede categorized countries into
clusters, based on the relative similarities between cultures. If we accept the idea
of stereotyping as a common way of perceiving different nationalities, Hofstede’s
work may be open to criticisms (indeed see the recent debate between Hofstede
(2002) McSweeney (2002, 2002a) and Smith (2002) on the recent publication of an
updated version of Culture’s Consequences). For example, there is much argument
as to whether cultures can really be thought of as homogenous. However, most
writers view the work of Hofstede as important, and as somewhere between a
stereotypical description of a national culture and a useful tool for discovering an
alien culture. So in that way it can be usefully used as a practical framework for
managers to understand potential cross-cultural differences in managing different
individuals or in different cultures. To conclude on Hofstede’s work, most people
would agree that the framework is helpful as a heuristic device to assist the
process of learning about a new culture. Hofstede’s findings are useful when
applied as a general model that requires interpretation of specific circumstances. It
is important that culture assessment focuses on the general make up of a nation or
culture. This can be thought of as a curve, where most people will be near the
‘norm’, but there will be people in every society who exhibit characteristics that
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are distinctly different. Therefore these ‘mainstream’ cultural traits are best con-
sidered as a tendency or describing the behaviour of the average individual, but
clearly there is the potential for other individuals to behave differently. Lastly,
Hofstede’s work is important in suggesting that true convergence in management
and organizational practices will never occur due to the varying cultural differences
outlined above.
The institutional perspective
The difficulty in operationalizing and making concrete such amorphous notions as
tradition and culture has led a variety of writers to shift the analysis more towards
social institutions, such as education, vocational training patterns and employee/
industrial relations. Ferner (1994: 93) suggests that, ‘there is more to national vari-
ation than some nebulous notion of “cultural difference”’, and as a result, attention
should also be paid to more concrete institutional factors. This point is also noted
by Tayeb (1994: 431) who recognizes that ‘The term “nation” refers not only to cul-
ture, but also to other social, economic and political institutions which have a sig-
nificant bearing on the management style of organizations located in particular
countries’. The recognition that culture should not be seen as a synonym for nation
and an omnibus variable representing a range of social, historical, political and
economic factors, lies at the heart of the institutionalist perspective. The ‘harder’
institutionalist argument is primarily concerned with structural aspects within soci-
ety and organizations, such as the division of labour and career, status and reward
structures. These features are generated by the institutions of the host country
which, as previously noted, will affect elements such as education, training and
employee/industrial relations systems. Indeed, it is often the employee/industrial
relations system which is most often cited as the least permeable aspect of a host-
country environment, as this may often be based on a state regulated legislative
framework. Hence, there is likely to be tension between activities carried out by an
MNC and the national system of employee/industrial relations in any given host
country. This is particularly apparent within countries which have strong regula-
tory frameworks, which are likely to be a source of rules to which the MNC must
comply. For example, an American MNC may ordinarily work without trade
unions but in locating in Germany may be forced to recognize and negotiate with
trade unions due to the regulatory framework (see Royle 2002 and Royle and
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 44
Towers 2002 for an interesting discussion on how McDonald’s have sought to
override regulatory mechanisms in Europe). In sum, the impact of both the culture
and institutions means that a MNC has to consider carefully what HRM policies
and practices they can transfer because as Ferner notes (1997: 33):
… not all elements [of an MNCs human resource policies] are ‘exportable’
being too rooted in native cultural assumptions; and second because to
varying degrees host countries present obstacles to the ‘import’ of elements
of foreign business systems, and colour the operation of those which are
transferred.
Recognition of all of the above variables allows for an assessment of the impact of
specific national institutional, legal and cultural frameworks, so as to be able to
answer questions about the balance between innovation and adaptation in corporate
HR policies.
MNCs and HRM policies and practices in the
tourism and hospitality industry
We have recognized that MNCs face choices in both the manner in which they
develop their overall approach to IHRM and then how this will determine their
approach to international staffing and what HR policies and practices they seek to
transfer. Of course, MNCs are likely to want to maintain and develop a degree of
consistency in their ways of managing people on a worldwide basis. Equally
though in order to be effective locally, they may also need to adapt those ways to
the specific cultural and institutional requirements of different societies. We can
now briefly assess some of the evidence of how tourism and hospitality MNCs
may be seeking to address these issues.
Nankevis and Debrah (1995) report on management practices in a selection of
hotels in Singapore and Australia to discuss common and disparate themes within
diverse national, cultural, social and labour market environments. The basic prem-
ise of Nankevis and Debrah is that the hospitality industry is increasingly looking
to HRM to enhance organizational success and competitive advantage. To test this
proposition they used a questionnaire with 35 multiple choice questions, which were
occasionally supplemented by open-ended follow-up comments for clarification
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 45
or enlargement. The questionnaire was divided into four major categories: type of
hotel; employee details; personnel management/HRM practices and guest feed-
back. There were 109 responses (89 from Australia and 20 from Singapore) from
201 questionnaires. In relation to a range of HR issues Nankevis and Debrah found
considerable differences in approaches in Singapore and Australia and such dif-
ferences were attributable to elements such as national, cultural, social, labour
market phenomenon and management styles. Nonetheless their findings did ‘also
appear to confirm the increasing globalizm of guest market requirements and
hotel management responses’ (ibid.: 512). This was particularly so in relation to
the MNC hotel companies surveyed, leading Nankevis and Debrah (1995: 511) to
suggest that, ‘Apotential consequence of [the high proportion of hotels owned by
multinationals] is the standardization of service along with increased efficiency,
productivity and thence profitability’.
Similarly, Jansen-Verbeke (1996) reports on research undertaken in hotels
(including international hotels, e.g. Hilton International) in Belgium and The
Netherlands which suggested a high level of uniformity in managerial practices.
Jansen-Verbeke utilized Hofstede’s seminal framework to assess the extent to
which cultural differences may exist between Belgian and Dutch managers. The
research consisted of a written questionnaire, comprising 45 questions asking
managers about their everyday practices in hotel management, and the sample
consisted of 64 respondents. As Jensen-Verbeke (1996: 547) notes ‘The analysis
shows that there are only a few differences in the practices of hotel managers in
Belgium and The Netherlands’. To explain this convergence Jansen-Verbeke points
to a range of factors, such as: the two countries belonging to the same cultural
region; the homogenizing effect of organizational culture, reflecting the fact that
most MNCs have a strong organizational culture; and the culture of the hotel
industry in general, particularly in terms of uniform procedures in guest contact
and an emphasis on quality of service. Of these, it is particularly noteworthy that
organizational culture and the culture of the industry seem to play such a key role
in the process of homogenization and convergence.
Review and reflect
What are some of the potential challenges facing tourism and hospitality MNCs in
attempting to transfer their HRM practices across national boundaries?
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The above discussion seems to suggest that the continued growth of multinational
corporations is likely to lead in the future to greater standardization of services, as
organizations seek greater efficiency, productivity and profitability, by utilizing
the full range of ‘soft’ techniques leading to a burgeoning sector wide ‘best prac-
tice’ approach to HRM and quality service (and see also Nickson, 1999). Acounter
argument though is offered by Mwaura et al. (1998). In their research on the ITT
Sheraton Hotel China they found significant evidence of Sheraton’s corporate cul-
ture being in conflict with several aspects of Chinese culture. For example, Chinese
managers and subordinates were not prepared to accept responsibility to ensure
responsiveness to the hotel guests. Asimilar issue was also apparent in attempts to
engender a commitment to customer satisfaction via training. Many of the local
employees were reluctant to contribute to discussions in training sessions in case
they lost ‘face’. Similar results were also found by D’Annunzio-Green (2002) in her
research on the experience of expatriate managers in Russia. Here the attempts by
expatriate managers to engender and maintain high service standards were often
thwarted by the different attitudes to service of the Russian staff. Many of the staff,
particularly those over 30, still exhibited behaviours which were developed dur-
ing the previous communist-era Soviet system. Under this system Russians would
never complain about service, no matter how bad it was. Resultantly, the lack of a
customer orientation is still apparent in a large number of the staff. What the work
of Mwaura et al. and D’Annunzio-Green exemplifies is that western management
practices cannot always be transferred in the tourism and hospitality industry, due
to differing cultural and organizational working environments (and see also Lucas
et al., 2004; Zhang and Wu, 2004).
Conclusion
We noted how increasingly tourism and hospitality organizations may be operating
on an international or even global basis. It was recognized that in internationalizing
organizations face choices in their strategic disposition, for example whether they
adopt a broadly ethnocentric or polycentric approach. The overall strategic dispo-
sition of a MNC will also impact on how they develop their international staffing.
In addressing issues of this nature MNCs may seek to utilize practices only from
its home country, imitate practices typical of other countries or increasingly utilize
an amalgam of HRM practices drawn from many other companies and countries,
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especially in pursuit of notions of ‘best practice’. We noted how this has led many
to talk in terms of whether there is increasing convergence in the manner in which
HRM policies and practices are developed. In this view HRM practices are ‘culture
free’ and universalistic and so the transfer of managerial practice is straightfor-
ward, particularly if that practice is considered as ‘best practice’. On the other
hand we also noted the enduring influence of host countries’ culture and institu-
tions leading many to argue for divergence. In the latter view HRM practices are
‘culture bound’ and difficult to transfer because of the primacy of differentiating
effects of national culture or the need for MNCs to respond to differing legal and
regulatory framework in a number of countries.
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I NTERNATI ONAL HUMAN RESOURCE MANAGEMENT 49
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Chapter 3
Organizational culture
Chapter objectives
This chapter considers the increasing importance
of organizational culture to tourism and
hospitality organizations. The objectives of this
chapter are:
? To assess debates about the manageability of
culture.
? To consider the various aspects of
organizational culture.
? To recognize the role of organizational culture in
a broader HRM strategy.
50
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Introduction
We recognized in the previous chapter the importance of national culture and par-
ticularly the manner in which it is likely to have an impact on workplace behav-
iour. The same is also true within organizations. All organizations will have a
culture which will have an impact on the way employees behave within the organ-
ization. As we have already recognized in Chapter 1 within human resource man-
agement employees are seen as a key resource. Our core definition of HRM from
Storey talked about cultural aspects of HRM, so part of the way in which employ-
ees, as a key resource, can be managed is through the use of organizational culture
to generate commitment to the organization and its values. Thus, as Ogbonna
(1992: 80) notes, ‘the achievement of HRM objectives requires the management of
the organizational value system (culture) and this requires skilful implementation’.
Often within tourism and hospitality such values will be concerned with encour-
aging employee buy in to the customer care and service quality initiatives, which
organizations see as a form of competitive advantage in the crowded marketplace.
This process of seeking buy in from employees is likely to have a significant impact on
a range of human resource practices, such as recruitment and selection, training and
remuneration. For example, tourism and hospitality organizations may look to recruit
and select those who are considered to ‘fit’ in with the culture. However, whilst many
organizations and managers within the tourism and hospitality industry now see the
management of organizational culture as a potential source of competitive advantage,
there are others who caution against the overly optimistic claims made for organi-
zational culture. Recognizing these competing views on organizational culture this
chapter will aim to offer a balanced assessment of the place of organizational culture
within a broader human resource strategy. Specifically, in examining organizational
culture there are three key questions that need to be addressed:
1 What is organizational culture?
2 How can we study it?
3 What role does organizational culture play in organizational success?
In search of a definition
Before we begin to move towards a definition it is important initially to recog-
nize debates about the terminology employed to describe the manner in which
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organizations attempt to use culture as a device to create integration and cohesion
across the organization. Central to this debate is the key question of the manageabil-
ity or otherwise of culture (Legge, 1994). Commonly in books or articles the terms
organizational and corporate culture may be used interchangeably. Legge (1994)
cautions against this uncritical use of the two terms. For example, she argues that
‘in using the term “corporate” culture, many writers seem to be imputing a culture
created by senior management for the lower orders to swallow’ (p. 407). In this view
‘corporate’ culture is something an organization has. Consequently, it can clearly
be managed for the benefit of the organization and its members. On the other
hand, the use of the term organizational culture reflects the manner in which cul-
ture emerges from social interaction amongst organizational members; something
that an organization is. In the latter view culture may be difficult to manipulate,
change or manage. Given some of the claims that are made about the link between
organizational or corporate culture and organizational success this is an important
caveat from Legge and one that should be borne in mind throughout the chapter.
Notwithstanding debates about whether the preferred terminology should be
organizational or corporate culture, we should attempt to define the concept.
Brown (1998: 7–8) recognizes the multiplicity of definitions of organizational cul-
ture and the differing intellectual traditions that they come from. Based on these
various definitions Brown (1998: 9) offers his own: ‘Organizational culture refers
to the pattern of beliefs, values, and learned ways of coping with experience that
have developed during the course of an organization’s history, and which tend to
be manifested in its material arrangements and in the behaviour of its members’.
For many this can be succinctly summarized as, ‘The way we do things around
here’ (Deal and Kennedy, 1988: 4). As we noted earlier all organizations have their
own unique culture and in recent years attention has focused on the manner in
which organizations can potentially use culture to unlock the commitment and
enthusiasm of employees. This process of unlocking commitment and enthusiasm
is by no means straightforward or uncontested (Thompson and McHugh, 2001).
For example, we should be aware of the notions of sub-cultures, such that all organ-
izational members might not subscribe to the organizational vision. Recognition
of the potentially contested nature of organizational culture is important because
it points to the manner in which there may be a disjuncture between the rhetoric
and reality of organizational culture. Brown (1998) expresses this point as the
espoused culture and the culture in practice. The former may be the positive view
that is presented for public consumption, whilst the latter may allow for a more
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critical reading of any given organizational culture and to further appreciate this
point the chapter now considers competing views of organizational culture.
Competing views on organizational culture
The discussion above points to the debate about whether culture is, in fact, man-
ageable and to recognize some of the competing claims made about culture we
should acknowledge the useful work of Ogbonna and Harris (2002). In reviewing
organizational culture they attempt to categorize the range of work into three
broad labels, ‘the optimists’, ‘the pessimists’ and ‘the realists’.
Optimists
Akey aspect of the optimists position is that culture can be used as a mechanism to
facilitate organizational unity and cohesion. Thus, ‘the key works of key “cultural
optimists” show that this perspective not only assumes the existence of unitary cul-
tures in organizations but it also implies that cultural control by top management is
possible and desirable’ (p. 35). Indeed, Ogbonna and Harris suggest that in recog-
nizing the manageability of culture optimists, ‘generally argue that those organiza-
tions that fail to control their cultures will be missing an opportunity to harness
their human resources’ (p. 35). The optimists view relies on a lot of assumptions,
not least that the interests of senior managers are shared by others in the organiza-
tional hierarchy. This type of thinking was particularly prevalent in much of the
research and writing about organizational culture in the 1970s and 1980s, most
obviously exemplified by the excellence genre, or what Thompson and McHugh
(2001) refer to as the ‘corporate culture merchants’, such as Peters and Waterman
(1982). Optimists also argue that there is a potentially positive relationship between
organizational culture and business performance (and see HRM in practice 3.1).
Pessimists
Ogbonna and Harris note that academics tend to predominate in this group and often
approach the issue from largely theoretical perspectives. In that sense pessimists
seek to develop the ‘explanatory power of the culture concept rather than in
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HRM in practice 3.1 Strong culture at the
Regent Hotel
Kemp and Dwyer (2001) reflect an optimistic view of organizational culture in their
research undertaken in the Regent Hotel, Sydney. The starting point of Kemp and Dwyer’s
research is that culture is viewed as an integrating, unifying phenomenon, shared by all
organizational members. In this manner culture can be used to integrate and bind orga-
nizational members; it becomes a normative ‘glue’. The authors believe that a ‘strong’
culture is an important enabling force in strategy formulation and ultimately is a major
aspect of enhancing organizational performance. Drawing on interviews with 45 man-
agers and employees of the hotel, Kemp and Dwyer recognize a variety of ways in which
cultural aspects are integral to the development of HRM practices. For example, they
suggest that within the hotel control is primarily through attempts to ensure that the
employees offer quality service and exceed guests’ expectations. Thus, ‘Behavioural
control is exerted through hotel training. Staff are taught how to enjoy their job and that
they should greet guests at all times with a smile. In the attitude workshop staff are told
that “smiles are what count”. These smiles need to be as crisp as their daily dry-cleaned
uniforms’ (p. 87). Even before the extensive attitudinal and behavioural training though
control is exerted through recruiting the ‘right’ kind of people, who identify with the cor-
porate objectives. It is also suggested that control is not too tight, but rather the Regent
Way corporate culture encourages the ‘right’ kind of behaviour. If employees exhibit the
right kind of behaviour this is recognized in formal celebrations of cultural values, often
in the form of ceremonies which celebrate an aspect of the organizational culture. To
illustrate this point Kemp and Dwyer recognize how the Regent Hotel rewards staff who
exceed expectations in some way with a formal presentation in front of their peers, argu-
ing that, ‘These ceremonies are extremely motivating and serve to ensure a repeat of the
superior performance by the staff member’ (p. 84).
Culture, it is suggested, permeates every aspect of operations at the Regent Hotel,
shaping the employees’ responses to guests and also management’s responses to their
most important asset, their human resources. According to Kemp and Dwyer, the Regent
Hotel exemplifies a strong culture in which top management set the game plan and then
individuals throughout the organizational hierarchy have responsibility for operationaliz-
ing the plan. The cultural approach of the Regent Hotel has resulted in breaking down
the barriers between the thinker and doers. It is suggested that staff at the Hotel share a
strong awareness of the corporate mission and philosophy. They all know that the
‘Regent Way’ encourages ‘Regent People’ to be innovative and creative.
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identifying its practical utility for managers of organizations’ (p. 36). Thus, and
arguably in response to the excellence genre, much of the research and theorizing
from the 1980s onwards has frequently questioned the extent to which organiza-
tions can manage culture successfully. The main thrust of the pessimists critique is
that such a complex issue as culture has been overly simplified by the optimists; ‘it
is argued that that culture is located at the deepest level of human consciousness,
of which neither researchers nor managers have sufficient knowledge to influence’
(p. 36). A second strand to the critique is the unitary assumptions that underpin
the optimists position on culture. Pessimists would point to the potential for con-
flict and contradiction in organizations which may be at odds with what the lead-
ers and managers in an organization think (see HRM in practice 3.2).
Realists
The last category suggested by Ogbonna and Harris are the realists. Increasingly
many researchers and writers are seeking a middle-way between the optimists and
the pessimists and this has led to the emergence of a realist research agenda. Realists
recognize that potentially culture can be changed. Equally, though, they eschew the
HRM in practice 3.2 Culture as an
Orwellian mechanism
One of the more pejorative critiques of ‘corporate culturism’ is that offered by Wilmott
(1993). Wilmott talks about the Orwellian nature of corporate culture, with its nascent
totalitarianism and 1984-style doublethink which attempts to create ‘governance of the
employee’s soul’. He suggests that corporate culture is largely interested in creating a mono-
culture where alternative views or competing cultures are not tolerated. By excluding those
considered as inappropriate in the recruitment and selection process and eliminating any
alternative values by training, corporate culture aims to strengthen core organizational values.
Any attempt to challenge the prevailing culture is considered a ‘crime against the culture’.
Consequently corporate culture is ‘a totalitarian remedy for the resolution of indeterminacy
and ambiguity: thought control through uniform definition of meaning … In Orwell’s
Oceania, “freedom is slavery” and “ignorance is strength”. In the world of corporate culture,
“slavery is freedom” and “strength is ignorance”’ (p. 527, emphasis in original).
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idea that this process will always be controlled by top management. Consequently,
‘realists are neither in support nor against the management of organizational culture.
Rather, they advocate fuller explorations of the application of the concept, in order to
develop greater understanding of the dynamics of cultural change’ (p. 37). For exam-
ple, Ogbonna and Harris note how culture change is more likely to occur during the
formation of the organization, periods of crisis or during leadership turnover. In sum,
the realist position, which is advocated by Ogbonna and Harris, is one which aims to
merge theoretical rigour with contributions to the practicality of how organizational
culture may be usefully used within a specific organizational context.
How can we study organizational culture?
Brown (1998) suggests that a number of different aspects or elements of culture
have been identified and all of these various aspects are useful in attempts to study
organizational culture:
? material objects;
? corporate architecture and corporate identity;
? symbols;
? language;
? metaphors;
? stories;
? myths;
? heroes;
? ceremonies, rites and rituals;
? norms of behaviour;
? values, beliefs and attitudes;
? basic assumptions;
? ethical codes;
? history.
Review and reflect
Using an organization with which you are familiar consider the extent to which you would
adopt either the optimistic, pessimistic or the realistic perspective to describe its culture.
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As Brown recognizes there may be a degree of overlap between the above elem-
ents, a point we return to below. Another key theme running through these var-
ious aspects of an organization’s culture is the extent to which they may be
manifest or visible. Schein (1985), for example, offers a well-known model which
describes three levels of cultural phenomenon in organizations: visible manifest-
ations, values and the deepest level of basic underlying assumptions. The first level
consists of artefacts and creations that construct the physical and social environ-
ment of the organization. This level is the most superficial manifestation of culture
and includes things like corporate logos, dress codes and written and spoken lan-
guage used in the organization. The second level is concerned with values, beliefs
and attitudes, which become prominent in the manner in which individual orga-
nizational members justify their actions and behaviour. As Lashley and Lee-Ross
(2003: 154) note ‘The extent to which members hold these core values and norms
as unquestionable determines whether the organizational culture is “strong” or
“weak”’ . The last level is the most fundamental and relates to basic and tacit
assumptions which impact on how organizational members perceive, think and
feel. Schein (1985: 18) suggests that ‘Basic assumptions … have become so taken
for granted that one finds little variation within a cultural unit. In fact, if a basic
assumption is strongly held in a group, members would find behaviour based
on any other premise inconceivable’. To further consider the manifest and not so
manifest levels of culture the chapter now returns to some of Brown’s elements of
culture.
Material objects, corporate architecture and corporate
identity and symbols
These aspects of an organization’s culture provide a visible and manifest way in
which it can be assessed. For example, mission statements are an obvious manifesta-
tion of material objects within organizations. Sufi and Lyons (2003) note how mission
statements are now considered an important part of any company’s strategic plan-
ning processes. The same authors note how mission statements can act as an impor-
tant tool for tourism and hospitality organizations to communicate to organizational
members and those outside the organization, such as customers and suppliers.
Agood mission statement should have some of the following components (Sufi and
Lyons, 2003: 258): concern for the customer, purpose, identity/image, differentiation
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factors, corporate values, products, markets, concern for survival, growth, profitabil-
ity, company philosophy and employee and social concern.
Beyond mission statements service organizations are also increasingly aware
of how they portray their corporate image, both in terms of attempts to offer aes-
thetically pleasing ‘hardware’ and ‘software’ (Nickson et al., 2001). Aesthetics are
a sensory experience through which objects appeal in a distinctive way. This
appeal does not necessarily have to be beautiful but rather and more simply
expressive. Materializing the concept of a company requires the transformation of
an abstractly defined identity into the adoption of a style; in practice, the produc-
tion of an aesthetic experience. Aesthetics have always been important to com-
panies. Companies past and present use aesthetics to express corporate identity.
These expressive forms are most obvious in the ‘hardware’ of organizations, such
as marketing material (internal and external), product design and the physical
environment of workspaces/offices (Witz et al., 2003). Three points are worth not-
ing with regard to the expression of corporate identity.
Firstly, as symbols and artefacts, these aesthetics are intended to influence the
perception of people as either customers or clients: organizations ‘use these sym-
bols in a vivid, dramatic and exciting way, because they know that symbols have
power to affect the way people feel’. Secondly, they are intended to add value to the
company. ‘Generally speaking, when companies use identity expressed through
design, they use it as a commercial tool; their purpose is to make greater profit out
of what they do in the short term’. Thirdly, in highly competitive markets with lit-
tle to differentiate most goods and services, aesthetics contribute to organizational
distinctiveness: ‘intangible, emotional. The name and visual style of an organiza-
tion are sometimes the most important factors in making it appear unique’ (Olins,
1991: 53, 71 & 75). Here we could think of McDonald’s Golden Arch, for example
(and see also Bryman, 2004 for a more general discussion of theming in other
tourism and hospitality settings).
With regard to ‘software’ service organizations are becoming increasingly con-
cerned to regulate the appearance of their staff, through the use of uniforms, dress
codes and appearance standards. Rafaeli (1993), for example, considers how the
dress and behaviour of customer contact employees’ shapes customer perceptions
of service quality. As she suggests:
… the thrust of organizational management of employees’ dress is that the
appearance of employees communicates something about the organization.
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The assumption is that what employees wear while at work, and how they
appear when interacting with customers, can influence customers’ feelings
about the organization and the service that it provides (p. 182).
Disney, for example, has a 36 page cast members’ appearance guide detailing length
and style of hair and the colour and quantity of cosmetics (Henkoff, 1994; and see
also Bryman, 2004). Some of the implications arising from how organizations are
increasingly seeking competitive advantage via employees appearance or their
‘aesthetic labour’ (Nickson et al., 2001) are further considered in Chapter 5.
Language and metaphors
Bryman (2004) recognizes that increasingly service organizations aim to create
performativity in the service encounter through the use of performative labour.
Such labour is described as ‘the rendering of work by managements and employ-
ees alike as akin to a theatrical performance in which the workplace is construed
as similar to a stage’ (p. 103). The use of a dramaturgical or theatrical metaphor is
one that has often been used with regard to the manner in which service employ-
ees perform emotional labour (Hochschild, 1983). As Burns (1997: 240) notes the
emotional demands made of front-line tourism and hospitality employees is that
they should ‘constantly be in a positive, joyful and even playful mood’. Brown
(1998) recognizes how language and metaphors aim to construct a common
understanding in organizations so that abstractions such as ‘good service’, ‘high
quality’ and ‘excellence’ are made meaningful. HRM in practice 3.3 and 3.4 offer
examples of how two organizations respectively use language and metaphor,
explicitly drawing on notions of performativity, to create the right type of behav-
iour in their front-line employees.
Review and reflect
To what extent should tourism and hospitality organizations be able to use aesthetic and
emotional labour to exert control over the manner in which employees behave? What
are the likely challenges of using these types of cultural controls?
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Stories, myths, heroes and history
Deal and Kennedy (1999) note how stories are an important part of an organiza-
tion’s culture due to their ability to transmit cultural values. Corporate stories will
often focus on exemplifying core values in the organization, often with recourse to
the achievements and daring do of cultural heroes, such as the founder of an
organization. In an earlier work Deal and Kennedy (1988) suggested that these
heroes personify the organizational values and epitomize the strength of the
organization. In becoming a ‘John Wayne in pinstripes’ heroic figures in organiza-
tions’ become role models for employees to follow. For example, Herb Kelleher
co-founder and long-time chief executive officer (CEO) of Southwest Airlines is well
known for his attempts to generate a sense of fun in the workplace. Known as the
HRM in practice 3.3 The use of language
in Disney
Everyday terms Disney speak
HR department Casting office
HR manager Casting rep
Theme park visitor customer Guest
Employee Cast member
Front-line employee Host or hostess
Public areas Onstage
Restricted areas Backstage
Theme park ride or show Attraction
Hiring for a job Casting
Job Role
Foreman Lead
Uniform Costume
Job interview Audition
Accident Incident
Queue/line Pre-entertainment area
Attraction designer Imaginer
Talking robot Audio-animatronic figure
Derived from Bryman (2004) IRS (2003).
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‘High Priest of Ha-Ha’ Kelleher was integral in creating a corporate culture premised
on fun. He believed in encouraging Southwest’s flight attendants to joke and kid with
passengers. Sunoo (1995) suggests that this strategy to hire the best people, treat them
with respect, and give them the freedom to make decisions and to have fun just being
themselves has created some of the most loyal employees in the airline industry.
Indeed, Bearden (2001) notes that in the immediate aftermath of 9/11 each of South-
west’s 32000 employees agreed to give back some of their pay to ensure company
stability in a turbulent business environment (and see also HRM in practice 3.5).
Norms of behaviour, values, beliefs and attitudes, and basic assumptions
Our earlier discussion of aspects such as performative labour and the mechanisms
utilized by tourism and hospitality organizations to engender the right kind of
emotional labour points to the manner in which they strive to achieve appropriate
HRM in practice 3.4 Warm fuzzies and cold
pricklies: the use of metaphor in Pizza Hut
Bate (1995: 44–45) notes that during the 1980s and early 1990s Pizza Hut’s employee
induction programme made use of a booklet called Feelings. The booklet attempted to
set out what employees should feel and particularly how they should display warm feel-
ings, or what were termed ‘warm fuzzies’, during their work. Negative feelings were
characterized as ‘cold pricklies’. These two feelings were anthropomorphized into two
cartoon characters: a malevolent, spiky haired, spiky-bearded dwarf (cold prickly) and an
appealing, round-eyed cuddly powder puff creature (warm fuzzy). Warm fuzzies were
shown helping old ladies and giving out ‘positive strokes’ to everybody. In contrast, cold
pricklies were seen getting wet and angry under black storm clouds and showing hostil-
ity to customers. The coldest of cold pricklies was the Big Fat Zero, who kept customers
waiting, refused to smile and ignored people altogether. Warm fuzzies were represented
in the booklet booting out cold pricklies and smiling no matter how hectic things
became. In attempting to create the right kind of emotional labour the company aimed
to ensure Pizza Hut employees saw themselves as warm fuzzies and act accordingly by
demonstrating the right kind of positive feelings towards customers, even when they did
not necessarily feel like doing so.
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behaviour. Many tourism and hospitality organizations may well recognize that
attempting to connect with their employees to generate a more fundamental level
of engagement in the appropriate values, beliefs and attitudes or even basic assump-
tions in the organizations, may be doomed to failure. In this sense the ability of
HRM in practice 3.5 Stories and myths from
some of the great hospitality entrepreneurs
Nickson (1997) argues for the importance of appreciating the need for an understanding
of history in reviewing the auto/biographies of Charles Forte, Conrad Hilton, Kemmons
Wilson (the founder of Holiday Inn) and Bill Marriott (senior). Nickson notes the manner
in which the stories and myths surrounding these famous hospitality entrepreneurs play
an integral part in creating a corporate aura and values. For example, the three American
‘giants’ are suggested to exemplify the American Dream, which sees America as a land
of opportunity, where individuals by hard work and self-improvement can achieve great
success. A key element of this is respect for ‘rugged individualism’ (Guest, 1990: 390)
and a willingness of individuals to grasp their opportunities by pushing back the fron-
tiers, both literally and metaphorically. In a literal sense, Hilton was brought up in the
‘half civilized country’ of New Mexico, where his father nearly became a victim of his
own pioneering spirit as he was only one of two men to survive an attack by Apache
Indians, an attack that left five others dead. The young Bill Marriott also demonstrates his
frontier spirit on a camping trip in killing a deadly snake – naturally ‘the biggest rattler
anyone could remember’ (O’Brien, 1977: 52–53) and two menacing brown bears. In a
metaphorical sense some of this frontier spirit is evidenced in the notion of the self-
reliant small businessman who sets up their own business and makes it successful. A
common theme which in the accounts is the humble beginnings of the subjects’ organ-
izations. Hilton, for example, famously described his first hotel, the Mobley, purchased in
Cisco, Texas in 1919 as ‘a cross between a flop house and a gold mine’ (Hilton, 1957:
109). Bill Marriott’s early business career began with an ‘A and W’ root beer franchise
which he acquired in 1927 and Charles Forte’s move into business came with the open-
ing of a milk bar in 1934. From such beginnings the nascent organizations quickly flour-
ished and many of the operating procedures and management styles described in those
early years can to some extent still be observed in the contemporary hospitality industry.
For example, Hilton is credited with being the ‘founder’ of internationalization in the
hotel sector and many aspects of the present Marriott philosophy, such as empower-
ment, can be seen to trace their history to Bill Marriott senior’s way of doing business.
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tourism and hospitality organizations to achieve cultural change at the deepest
levels of basic assumptions may well be impossible. Of course, employers will use
a variety of mechanisms to create the right kind of behaviour. Some of these may
be cultural mechanisms as described above; others may simply be about the use of
other means of control. For example, whilst some might claim that the ‘strong’ cul-
ture at McDonald’s is largely created by the prevailing organizational culture,
more critical authors would point to aspects such as deskilling and the use of non-
human technology (Ritzer, 2004). Even cultural mechanisms may be underpinned
by more rigid control mechanisms. Ogbonna and Wilkinson (1990) report the
example of one supermarket that as part of a culture change programme encour-
aged employees to smile more when engaging with customers. However, the com-
pany went one step further in introducing ‘smile supervisors’ who were tasked to
assess whether employee smiles were genuine. If smiles were felt not to be genu-
ine employees were reprimanded by the smile supervisors. Needless to say this
approach created a good deal of employee resentment. In reality, most organiza-
tions will simply settle for the right kind of outward behaviour being manifested
by their employees, without recourse to smile supervisors, even if such a perform-
ance is simply a manifestation of resigned behavioural compliance.
Clearly, then, there are a number of functions that organizational culture will
play. In this normative view of corporate culture, it attempts to foster social cohe-
sion, so that it becomes the ‘cement’ or ‘glue’ that binds an organization together
so it may offer co-ordination and control, reduction of uncertainty, a means to
motivate staff and ultimately competitive advantage. Throughout this chapter
though we have alluded to some of the potential difficulties in sustaining this nor-
mative view of culture. Beyond this point there is also a need to recognize the
debate about whether there really is any evidence to support a relationship
between organizational culture and performance, particularly whether culture can
enhance the effectiveness of an organization’s performance. Alvesson (2002: 53–54)
suggests that there are four views on the relationship between organizational
culture and performance:
1 The so-called strong culture thesis. In this view employees are assumed to be incul-
cated into a strong organizational culture and resultantly demonstrate a high
level of commitment to the organization and its values. Within the strong cul-
ture thesis it is assumed that the strength of the culture will be directly correl-
ated with the level of profits in a company.
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2 A reverse relationship between culture and performance. In this view it is suggested
that high-performance leads to the creation of a strong corporate culture. Orga-
nizational success creates common orientations, beliefs and values and an accept-
ance of the ‘way of doing things’.
3 Acontingent view of culture. In particular circumstances or conditions a particular
type of culture is appropriate or even necessary and is likely to contribute to
efficiency.
4 The need for adaptive cultures. Cultures that are able to respond to changing
circumstances or a change in the business environment are the key to good
performance (and see HRM in practice 3.6).
Ultimately in considering the relationship between culture and performance
Alvesson (2002: 54) notes that, ‘the relatively few systematic studies on the culture-
performance link lead us to conclude that none of these four ideas have received
much empirical support’. For example, much of the earlier work on culture, as
exemplified by Peters and Waterman (1982), was often underpinned by support for
the strong culture thesis. Thompson and McHugh (2001), amongst others, question
the evidence offered by Peters and Waterman and others supporting the strong
culture-enhanced performance thesis. As they suggest, ‘The tenuous link between
cultures, excellence and performance turned out to be highly fragile’ (2001: 199).
Generally, then, the case for whether a ‘strong’ organizational or corporate culture
is integral to the success of an organization remains unclear. More broadly, whilst
HRM in practice 3.6 A failure to adapt?
The failure of a culture to adapt may arguably partially explain the inability of Forte to
resist the hostile takeover mounted by the Granada organization. Nickson (1997) notes
the important role played by Lord Forte, the founder of the company, and how his influ-
ence was pervasive on the culture. In time, Lord Forte was succeeded by his son, Rocco
Forte, though many foresaw the difficulties of succeeding Lord Forte. Lashley and
Lee-Ross (2003) note how the strong power/role culture created in the Forte group was
anachronistic and uncompetitive and left the company vulnerable to the takeover.
Several pieces written during the height of the take-over battle seemed to question the
extent to which Rocco Forte could carry on his father’s legacy, especially if the previously
strong culture was creating rigidity and group think in the organization.
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ORGANI ZATI ONAL CULTURE 65
it might seem intuitively true that, for example, adaptive cultures are self-evidently
superior, again the evidence seems sparse, as far as Alvesson is concerned.
Organizational culture and HRM: a reprise
Throughout this chapter, we have considered the relationship between cultural
mechanisms and HRM strategies. Equally, we have also recognized debates about
the manageability of culture or whether organizational culture can be causally related
to enhanced effectiveness or performance in organizations. Ultimately, as we have
already recognized there are no easy answers to these issues and there is a need
to recognize the many competing claims or views about the nature of organiza-
tional culture. That said, Ogbonna and Harris’ espousal of the realist position is
one that attempts to reconcile some of these debates. If we accept the realist pos-
ition then there may be instances were culture may be managed or changed in sup-
port of organizational aims. As a corollary attempts to manage culture in support
of organizational aims will mean the adoption of certain HRM practices. Specifically,
we recognized that attempts to sustain a degree of cohesion through cultural
mechanisms is likely to mean that organizations will look to recruit those individuals
who are deemed to ‘fit’ in with the prevailing culture. Once recruited employees will
then undergo an intense period of induction and socialization to be fully inculcated
into the organizational culture. This process of inculcation is further reinforced
through training and development activities, which as we noted within hospital-
ity and tourism, will often be directed towards enhancing quality service. Lastly,
organizations may chose to reward those who are seen to have internalized the
values of the organization through enhanced financial rewards, such as those
described in Kemp and Dwyer’s case study of the Regent Hotel.
Review and reflect
What are some of the likely challenges facing tourism and hospitality organizations who
are seeking to use organizational culture as a unifying device as part of their broader
HRM strategy?
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That said, there is a need to consider some of the potential contradictions and
dilemmas in managing culture. Some of the contradictions and dilemmas may well
be posed by the sectoral context in which an organization operates. For example,
with regard to tourism and hospitality, Ogbonna and Harris (2002: 39–40) note how:
… the tensions between the key employment features of the industry – such
as labour flexibility, low pay, poor terms and conditions, casualization and
feminization – and the traditional ‘high commitment’ objectives of culture
management programmes make this an important industry for the study of
organizational culture.
Recognizing this point they go on to recognize some of the limitations in the extent
and manner of cultural intervention in the case study companies reported in their
study. For example, Ogbonna and Harris remain sceptical of the ability of tourism
and hospitality organizations to achieve cultural change at the deepest levels of
basic assumptions across the organizational hierarchy. The ability to achieve
deeper levels of cultural transformation may be problematic due to working con-
ditions and terms of employment, such as unsocial working hours and low pay.
Equally, the managers interviewed in Ogbonna and Harris’ case study organiza-
tions recognized the difficulties of gaining significant commitment from periph-
eral workers (and see also Figure 3.1).
Tight ‘fit’ between organization
and individual
Labour shortages, competition
for labour, ad-hoc recruitment
and selection
Quality and service
High trust and commitment Surveillance, tight control, low pay
Strong internal labour market High labour turnover, high
percentage of part-time employees
Adapted from Ogbonna (1992).
Difficult customers
Ideal HRM goals Contradictions and dilemmas
Figure 3.1 HRM and culture: contradictions and dilemmas
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ORGANI ZATI ONAL CULTURE 67
Ultimately, in considering the implications for practitioners Ogbonna and
Harris suggest that their findings point to how culture can best be managed. Crucial
to this point is the need to recognize that a differentiated approach is likely to work
best, reflecting the core and peripheral workforce in the tourism and hospitality
industry. In that sense core staff, who are long serving and exposed to extensive and
intensive culture programmes, may well be inculcated to a large degree into the
organization’s culture. However, for peripheral workers, ‘practitioners may well
focus their attention on ensuring behavioural compliance and appropriate emo-
tional displays’ (p. 50). Clearly then this points to the need for organizations to con-
sider differentiated, complex and sensitive change programmes as these are more
likely to be successful in gaining buy in to the culture from organizational members.
Conclusion
Alvesson (2002) suggests that too much organizational culture thinking has been
grounded in assumptions about the potentially positive consequences of culture, a
trend which arguably emerged with the panacean nature of the excellence genre,
which captured the managerial imagination when it first emerged in the early
1980s. Over time more reflective and critical accounts have sought to temper some
of this initial enthusiasm for the role that culture can play within the organization.
Ogbonna and Harris’ characterization of ‘optimists’, ‘pessimists’ and ‘realists’
neatly captures the evolving nature of the debate about organizational culture and
its ability to enhance commitment amongst organizational members. In adopting
a realist position Ogbonna and Harris attempt to recognize that culture can be
managed, though the extent to which this process may be successful remains con-
tingent. The nature of the industry, organization, occupation, employment status
within the organization and many other things beside are all likely to impact on
the extent to which organizational members ultimately immerse themselves in
the basic assumptions of the organization, or simply manifest resigned behavioural
compliance.
References and further reading
Alvesson, M. (2002) Understanding Organizational Culture, Sage.
Bate, P. (1995) Strategies for Cultural Change, Butterworth-Heinemann.
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Bearden, T. (2001) ‘High flyer’, PBS News, November 28, http://www.pbs.org/newshour/bb/transportation/
july-dec01/southerwest_11-28.html (accessed 8 August 2005).
Brown, A. (1998) Organizational Culture, Pitman, 2nd edition.
Bryman, A. (2004) The Disneyization of Society, Sage.
Burns, P. (1997) ‘Hard-skills, soft-skills: undervaluing hospitality’s “service with a smile”’ , Progress in
Tourism and Hospitality Research, 3, 239–248.
Deal, T. and Kennedy, A. (1988) Corporate Cultures: The Rites and Rituals of Corporate Culture, Penguin.
Deal, T. and Kennedy, A. (1999) The New Corporate Cultures: Revitalizing the Workplace after Downsizing,
Mergers, and Reengineering, Perseus.
Guest, D. E. (1990) ‘Human resource management and the American Dream’, Journal of Management
Studies, 27, 4, 378–397.
Henkoff, R. (1994) ‘Finding and keeping the best service workers’, Fortune, 3 October, 52–58.
Hilton, C. N. (1957) Be My Guest. Englewood Cliffs, New Jersey: Prentice-Hall.
Hochschild, A. (1983) The Managed Heart, University of California Press.
Industrial Relations Services (2003) ‘The mouse trap: company culture at Disney World’, IRS Employment
Review, 783, 3 October, 21–23.
Kemp, S. and Dwyer, L. (2001) ‘An examination of organizational culture – the Regent Hotel, Sydney’,
International Journal of Hospitality Management, 20, 77–93.
Lashley, C. and Lee-Ross, D. (2003) Organization Behaviour for Leisure Services, Butterworth-Heinemann.
Legge, K. (1994) ‘Managing culture: fact or fiction’, in K. Sisson (ed.) Personnel Management: A
Comprehensive Guide to Theory and Practice in Britain, Blackwell, 397–433.
Nickson, D. (1997) ‘Colorful stories’ or historical insight? A review of the auto/biographies of Charles Forte,
Conrad Hilton, J.W. Marriott and Kemmons Wilson, Journal of Hospitality and Tourism Research, 21(1),
179–192.
Nickson, D., Warhurst, C., Witz, A. and Cullen, A.M. (2001) ‘The importance of being aesthetic: work,
employment and service organization’, in A. Sturdy, I. Grugulis, and H. Wilmott (eds.) Customer Service –
Empowerment and Entrapment, Palgrave, 170–190.
O’Brien, R. (1977) Marriott: The J Willard Marriott Story, Desert Book Company.
Ogbonna, E. (1992) ‘Organizational culture and human resource management’, in P. Blyton and P. Turnbull
(eds.) Reassessing Human Resource Management, Sage, 74–96.
Ogbonna, E. and Harris, L. (2002) ‘Managing organizational culture: insights from the hospitality industry’,
Human Resource Management Journal, 12(1), 33–53.
Ogbonna, E. and Wilkinson, B. (1990) ‘Corporate strategy and corporate culture: the view from the check
out’, Personnel Review, 19(4), 9–15.
Olins, W. (1991). Corporate Identity, Thames and Hudson.
Peters, T. and Waterman, R. (1982) In Search of Excellence: Lessons from America’s Best-run Companies,
Harper and Row.
Rafaeli, A. (1993) ‘Dress and behaviour of customer contact employees: a framework for analysis’, Services
Marketing and Management, 2, 175–211.
Ritzer, G. (2004) The McDonaldization of Society, Pine Forge Press, Revised New Century Edition.
Schein, E. (1985) Organizational Culture and Leadership, Jossey-Bass Publishers.
Sufi, T. and Lyons, H. (2003) ‘Mission statements exposed’, International Journal of Contemporary
Hospitality Management, 15(5), 255–262.
Sunoo, B. (1995) ‘How fun flies at Soutwest Airlines’, Personnel Journal, June, 62–73.
Ch03-H6572.qxd 11/22/06 5:50 PM Page 68
Thompson, P. and McHugh, D. (2001) Work Organizations: A Critical Introduction, MacMillan Press,
3rd edition.
Van Maanen, J. (1990) ‘The smile factory: work at Disneyland’, in P. Frost, L. Moore, M. Louis, C. Lundberg
and J. Martin (eds.) Reframing Organizational Culture, Sage Publications, 58–76.
Wilmott, H. (1993) ‘Strength is ignorance; slavery is freedom: managing culture in modern organizations’,
Journal of Management Studies, 30(4), 515–552.
Witz, A., Warhurst C. and Nickson, D. (2003) ‘The labour of aesthetics and the aesthetics of organization’,
Organization, 10(1), 33–54.
Woods, R.H. (1989) ‘More alike than different: the culture of the restaurant industry’, Cornell Hotel and
Restaurant Administration Quarterly, 30(2), 82–98.
Websites
There are a number of useful weblinks and case studies which can be found at http:/ //www.new-
paradigm.co.uk/Culture.htm
Southwest Airlines has a unique culture which stresses the fun nature of the business and details can be found
at http:///www.southwest.com/about_swa/
Edward de Bono and Robert Heller are well know management gurus and they have some interesting thoughts
on organizational culture which can be found at http:/ //www.thinkingmanagers.com/business-manage-
ment/corporate-culture.php
ORGANI ZATI ONAL CULTURE 69
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Chapter 4
Labour markets
Chapter objectives
This chapter considers the nature of labour
markets in the tourism and hospitality industry.
Specifically, the objectives are:
? To appreciate the different levels of analysis in
understanding labour markets.
? To understand the particular sectoral character-
istics that determine the tourism and hospitality
labour market.
? To consider debates about the use of flexible
labour strategies within tourism and hospitality
organizations.
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Introduction
We should start by asking a key question; what do we mean when we talk about
labour markets? At any one time people will be trying to either change their job or
acquire a job and employers will be looking for employees, and this means that, in
principle, in the external labour market all workers are assumed to be competing for
all the jobs all the time. In reality, of course, this may not be the case and we can appre-
ciate this by disaggregating different types of labour markets. Within this process
there is also a need to have some awareness of a range of macro-economic issues,
political and social factors and their impact on the external and internal labour
markets, which will change and affect the work of HR practitioners directly and vis-
ibly, in terms of issues like employee/industrial relations, recruitment, training and
development and pay. It should also be recognized that the nature of labour supply
is equally important and as the Cabinet Office (2003) has recently noted demographic
changes are having a significant impact on labour supply. In that sense the Cabinet
Office recognizes that most established European Union (EU) member states are
experiencing to a greater or lesser extent a number of challenges with regard to
labour supply. Specifically within a UK context:
? Declining birth rates mean that by 2011 under 16s will make up only 18 per cent
of the population in the UK.
? Increases in longevity, plus more young people into higher education, mean
that the ‘greying’ of the workforce – in 2006, 45–59 year olds formed the largest
group in the workplace.
? The workforce is becoming increasingly ‘feminized’ – by 2011, 82 per cent of
extra jobs will be taken by women.
? The role of people from ethnic minorities is likely to become increasingly
significant – they could account for no less than 50 per cent of growth in the
working population over the next decade.
? Migrant workers already make up much of the labour shortfall and are likely
to continue to do so.
Levels of analysis in the labour market
To further appreciate some of the points discussed above we can develop an
understanding of labour markets by recognizing several different levels of analysis,
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encompassing both the external and internal labour market. We begin with under-
standing the external labour market; that is the labour market outside of the organ-
ization and initially consider the idea of a transnational labour market.
Transnational labour market
Throughout time economic migration has meant that people have been willing to
move to find work or better paying jobs. In a more contemporary vein one of the
key drivers of an increasingly transnational and international labour market is the
role of multinational companies (MNCs). We have already noted in Chapter 2 how
the continuing growth of world markets, increased availability of management
and technological know-how in different countries, global competition and inter-
national customers, advances in telecommunications, and greater regional polit-
ical and economic integration have all increasingly pushed MNCs down the road
to seeking a more global orientation. Equally, we also noted how MNCs face choices
in how they staff their overseas units, including the use of expatriate managers and
how the use of such managers is commonplace in the tourism and hospitality
industry. Expatriate managers can be seen as denoting a rather more strategic use
of HR by MNCs. In addition to this more strategic movement of individual man-
agers, individuals may also choose to move internationally in their search for work
or enhanced career development.
Afurther aspect which has already been alluded to is the creation of regional
trading blocs. It is widely recognized that the EU is the most developed trading
bloc and already evidences a high degree of economic and social integration. With
regard to employment a key issue has been the commitment to sustain the free
movement of labour between member states. More recently the EU has seen the
accession of 10 new member states (Poland, Czech Republic, Hungary, Slovakia,
Lithuania, Latvia, Slovenia, Estonia, Cyprus (Greece) and Malta) from 1 May 2004
and some of the employment implications of the increase from 15 to 25 countries
within the EU are considered in HRM in practice 4.1.
National labour market
At the national level the government has a major influence on the labour market and
the manner in which policy is developed with regard to employment and economic
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issues will clearly impact on the nature of the national labour market. Generally
speaking when governments come to develop their labour market policy they face
a choice in terms of the extent to which they will seek to regulate employment
policies and practices. For example, it is often argued that there is a distinct differ-
ence between a European approach to labour markets, which is often described
as the European social model; and the so-called Anglo-Saxon approach, which is
represented by the US, and to an extent the UK. In simple terms it is suggested that
the European social model has tended to offer much greater regulation to achieve
HRM in practice 4.1 EU expansion: A solution
to labour and skill shortages in tourism and
hospitality?
The accession of the 10 new states from Central and Eastern Europe meant another 74
million people joined the world’s largest single market. Whilst there has been some con-
cern at the notion of large numbers of people seeking to move from Eastern to Western
Europe with the new immigrants proving a strain on existing member states, in reality,
the movement across Europe has been relatively small. In part, this is explicable by the
fact that initially only the UK, Irish and Swedish Governments allowed people from the
new accession states to work, as long as they register. The other 13 EU countries agreed
to impose restrictions on immigration from the east until at least 2006, and possibly till
2011. The decision of the British Government was largely driven by the recognition of
significant labour and skill shortages in a number of industries, including hospitality and
tourism, a situation likely to be exacerbated with the recognition that over 500 000 new
jobs are expected to be created to 2010. Many of those moving from the new member
states are young, well educated, highly motivated and seeking work in tourism and hos-
pitality. Employers in tourism and hospitality are already recognizing this new source of
labour and migrant workers seem to be viewed in a positive manner by employers. Jean
Urquhart, owner of the Cellidh Place, an arts hotel in Scotland, is quoted as saying, ‘The
whole tourism industry would collapse without them’. Similarly a manager from Pizza
Hut in Inverness suggests that his five Polish workers were ‘never sick, never late, they
just work away and we value them very, very highly’, even to the extent of suggesting
that they are better than Scottish workers. Corus Hotels is another company which has
taken advantage of the wider talent pool and targeted more workers from Eastern
Europe by recruiting over 30 new employees from Poland.
Derived from Cottell (2005), Gunn (2004), Meiklem (2004) and Warren (2004).
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a balance in interests between capital and labour, whilst in the US especially the
approach has relied much less on regulation and instead has operated on a free
market basis. Of course, this is something of an oversimplification, though it is
useful to delineate differing approaches and in more recent years the UK has
sought a balance between these two approaches with the so-called ‘third way’,
which seeks both a degree of regulation and flexibility. To appreciate why this is
the case it is worthwhile briefly considering recent labour market developments
in the UK, within the context of the discussion above.
In recent years there has been something of a change in policy within the UK. In
the period 1979–1997 the Conservative Governments of Margaret Thatcher and John
Major felt that there was too much regulation and the key thrust of much of their
policy towards the labour market was to remove what they viewed as rigidities in
the labour market. By espousing a free market with little regulation, the Conserva-
tive Governments argued that employers had greater freedom in developing their
employment policies and practices and that this was important for wealth creation.
The shift towards much less regulation in the labour market was felt to be especially
important for small businesses who often complain about the deleterious impact of
too much regulation on their business. As part of a whole series of legislation such as
the Wages Act 1986, Trade Union and Labour Relations Consolidation Act 1992 and the
Trade Union Reform and Employment Rights Act 1993 the Conservative Governments
sought to limit and restrict the autonomy and influence of trade unions as well as
allowing employers much greater latitude in areas such as hiring and dismissing
workers and pay setting.
Since 1997 the Blair Governments have attempted to keep many elements of
the flexible approach advocated by the previous government though they have, at
the same time, introduced some measures to regulate employment. Firstly, they
signed up to the enlarged EU Social Chapter in 1997. Although the Social Chapter
is not a legislative programme it does provide mechanisms for harmonizing min-
imum standards of employment and social provision across the EU. The previous
UK Conservative Government (1992–1997) had negotiated an opt-out, but with
the Labour Government signing up to the Social Chapter a number of HRM
policies were affected.
From a labour market point of view the most important impact was the intro-
duction of Directives on parental leave, working time and part-time employees.
The Parental Leave Directive allows parents to take up to 3 months unpaid leave
after the birth of a child, up to their 8th birthday (and see HRM in practice 4.2).
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The Working Time Regulations are considered more fully in Chapter 11. Lastly,
the regulations on part-time employees require employers to treat them no less
favourably than full-time employees. For example, part-time staff should receive the
same pay and benefits, on a pro-rata basis, as full-time employees. As we have
already noted in Chapter 1, hospitality and tourism is particularly reliant on part-
time workers and it was felt that this and the other Directives would be potentially
harmful to the viability of many businesses, particularly small business. In reality,
though, the impact has been less than feared, in part because employers have been
able to water down the regulations to lessen their impact (see for example Hurrell,
2005). In addition to signing up to the Social Chapter, the Blair Governments have
also introduced a range of employment-related legislation. Most noteworthy are the
National Minimum Wage Act 1998, Employment Relations Act 1999 and Employment Act
2002. These acts established minimum employment standards in areas such as pay,
dismissal and trade union recognition.
Whilst all of these aspects have certainly added some regulation to the labour
market and impacted on tourism and hospitality employers HRM policies, in reality
HRM in practice 4.2 Female friendly?
How do countries compare?
There is much debate about how best to respond to greater feminization in the labour
market and how best to balance work and family. A key issue within this broader debate
is the support from the state to women in providing maternity leave and pay and facili-
tating a return to work. Practices vary significantly between countries and this is a good
indicator of the extent to which governments are willing to intervene in a key labour
market issue. For example, in the UK women have the right to return to work after
26 weeks paid maternity leave. Employers also have to ‘seriously consider’ requests from
parents for more flexible working. This is in contrast to the US where there is no nation-
wide policy on parental rights and no national provision for maternity leave, paid or other-
wise. The same is also true for Australia where maternity leave is unpaid and only
available to employees who have been on the payroll for 12 months prior to the birth.
The most family-friendly countries are arguably Sweden and Norway. For example in
Sweden both parents are entitled to 18 months off work and in Norway a year’s leave is
paid at 80 per cent of salary.
Derived from Groskop (2006).
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the UK is felt to have a relatively unregulated labour market compared to most
other EU countries. Indeed, the UK Prime Minister Tony Blair still regularly claims
that the UK remains the most lightly regulated labour market of any of the leading
economies. What much of the above discussion points to is the recognition of
the impact of government policy on employment policy and HRM practices in
organizations. Thus, it is important to understand that this is an important environ-
mental and contextual feature in terms of how firms will plan their labour market
policies.
Sectoral labour market
To consider the nature of the sectoral labour market in tourism and hospitality,
we should remind ourselves again what kind of industry tourism and hospitality
is. As we have already noted the tourism and hospitality industry can be taken to
include a wide variety of organizations encompassing areas like hotels, guest-
houses, bed and breakfast, farm houses, holiday parks, restaurants, pubs and
cafes, airlines, cruise ships, travel agencies, tour companies and so on. Equally, we
also recognized that it would be wrong to imagine that the industry can be
thought of as homogenous (an obvious example is the spread of different types of
organizations in the industry, from the local chip shop to huge multinationals with
a presence all over the world). Despite this growth in larger chains most sectors of
the industry are still dominated by small, usually owner-managed units consisting
of family labour and a small number of helpers. Clearly, then, the sector is better
conceptualized as heterogeneous. However, whilst there is great heterogeneity in
the types and size of organizations there may be certain recurring features in large
parts of the tourism and hospitality industry, which are outlined below:
? Large numbers of individual units of varying size and many different types are
located throughout the whole of the country and internationally.
? Many units operate 24 hours a day, 7 days a week, 365 days a year.
? There are high fixed costs, a fixed rate of supply, but a fluctuating, seasonal and
often unpredictable demand.
? It is both a production and service industry.
? There is a wide variety of customers seeking to satisfy a variety of needs and
expectations. For example, leisure, business, conference and so on.
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? Services are supplied direct to the customer on the premises and the customer
usually leaves with no tangible product.
? Managers are expected to demonstrate proficiency in technical and craft skills
as well as in management areas.
? Many different skills are required but there are relatively large numbers of
semi- and unskilled staff.
? The majority of staff are low paid.
? Staff are often expected to work long and unsociable hours.
? There is a large proportion of female, part-time, casual, student and migrant
labour.
? Generally trade union membership is low.
? There is high labour mobility within the industry, and a high turnover of staff
joining and leaving the industry.
? The industry is labour intensive.
Perhaps the single biggest influence on the nature of labour markets in the tourism
and hospitality industry is the recognition that there are often wide fluctuations in
short-term demand for the product, which has major and obvious implications for
the staffing of an organization (and see Table 4.1).
Allied to this demand unpredictability is the fact that the industry is labour
intensive, which means labour is a high cost in the total costs of tourism and hospi-
tality businesses. Therefore many employers have tried to minimize labour costs.
This has meant that traditionally the industry has been staffed with what Wood
(1997) calls the so-called ‘marginal workers’, namely: women, young people, stu-
dents, migrant workers and ethnic minorities. Resultantly, it is argued by many that
these workers form the basis of a casualized, part-time workforce. This workforce
finds themselves in a low-skill job characterized by relatively low pay, which leads
to a lack of motivation and commitment on the part of employees, who may per-
ceive they are in a job which is often stereotyped as being about servility. Of course,
as we noted in Chapter 1, this description may be over generalizing the employ-
ment experience of many working in tourism and hospitality, and this characteri-
zation is unlikely to be true for all organizations, or reflect the circumstances for all
workers. For example, for many women working part-time will allow them to
match domestic and employment responsibilities. Equally, there may well be
skilled craft jobs which require some formal training or education, as opposed to
unskilled work which is just learnt on the job (and see HRM in practice 4.3).
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Table 4.1 Hotel demands variability
Examples of hotel demand variability
Daily Morning rush hour guest check-out and evening check-in peak demands for
restaurant services during meal time: breakfast (7–10 a.m.), lunch (12–2 p.m.)
and dinner (7–10 p.m.).
Weekly High occupancy during mid-week for business hotels, but low in weekends.
More restaurant reservations at the weekend.
Seasonal Winter closure of beach resorts. High occupancy rate in ski chalets during the
winter.
Ad hoc Flight cancellation leading to unpredictable demand for hotel rooms and meal
services. ‘Chance’ guest bookings.
Source: Lai and Baum (2005). Reprinted by permission of Emerald Group Publishing Ltd.
HRM in practice 4.3 Working in paradise
Patricia and Peter Adler (2004) offer an interesting example of how within luxury hotels
in Hawaii different types of employees are likely to have very different employment experi-
ences. Based on a near-10-year ethnographic study, Paradise Laborers is an attempt to
understand what goes on behind the scenes in five luxury hotels in Hawaii. Specifically,
Adler and Adler offer an in-depth analysis of the complex organizational and social sys-
tems of the hotels and how this impacts on the experiences of those working there; and
why, for many, working in the hospitality industry in Hawaii is akin to paradise. At the
heart of the book lies Adler and Adler’s typology of four different types of worker: new
immigrants, locals, seekers and managers. New immigrants are those who fill the most
menial, psychically demanding jobs in areas such as housekeeping and stewarding, pos-
itions which are considered undesirable by indigenous Americans. This characterization
of the new immigrants might suggest a life of hardship, drudgery and exploitation for
this group of workers. However, Adler and Adler note how the new immigrants were
‘highly valued, even crucial, workers in the hospitality and other local industries. While
others have depicted globalized workers as transient, our new immigrants became heav-
ily tied to and invested in their new country by opportunity, family, community, work, and
fierce loyalty’ (p. 217). Locals are equally tied to Hawaii – indeed Adler and Adler char-
acterize new immigrants and locals as being ‘trapped’, by choice, by the vicissitudes of
the local labour market. For many locals though, work in the resorts in regarded as being
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With regard to skill, Riley (1996) estimated that the skill composition in a typical
unit in the hospitality industry would consist of 6 per cent managerial, 8 per cent
supervisory, 22 per cent skilled craft workers and 64 per cent semi- or unskilled
operative staff, though see also HRM in practice 4.4.
desirable, unsurprising perhaps when travel and tourism provides over 20 per cent of
employment within Hawaii. Locals tended to occupy those jobs immediately above the
entry jobs taken by new immigrants in positions such as valets and bellmen and tended
to approach work with a ‘work to live’ attitude as ‘they did not want to live in paradise
if the cost was they could not enjoy it’ (p. 60). The latter two groups of seekers and man-
agers are characterized as being transient and primarily are affluent, middle-class, male,
mainland Americans who are usually just passing through Hawaii. Unlike new immi-
grants and locals, seekers and managers are able to draw on their inherent cultural cap-
ital, such as their education, which allows them greater occupational choice. However,
whilst managers are aiming to make a career in hospitality management and often work
long hours for relatively low rewards; seekers, or ‘drifter workers’ (p. 81), are attracted to
Hawaii to experience a much more hedonistic lifestyle, where leisure is foregrounded
over work, and work becomes a means to a recreationally focused end.
HRM in practice 4.4 Re-considering skill
Baum (2002) considers the nature of skill in the tourism and hospitality industry and argues
the need for more expansive thinking about the issue. Whilst broadly accepting Riley’s
characterization, Baum also points to the need to consider the changing nature of skills
in tourism and hospitality, with the emergence of aspects such as emotional and aes-
thetic labour. These ‘softer’ skills are harder to classify and locate within traditional
debates about the meaning of skill, dominated as they often are by the understanding of
skills being ‘hard’, technical skills, often accredited by qualifications or an apprenticeship.
Resultantly, the tendency towards describing much tourism and hospitality work as
unskilled may be increasingly oversimplified. Relatedly, Baum also questions the over-
whelmingly western centric view of skills, something that is inappropriate in a develop-
ing country context. Here many of the softer skills coming under the rubric of emotional
or aesthetic labour may be highly valued.
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In sum, then, the tourism and hospitality labour market is characterized by:
? Arelatively large proportion of unskilled occupations.
? Transferability of skills at any level between a broad range of establishments.
? Often, but not inevitably, high levels of labour turnover.
? Relatively low levels of pay, particularly for unskilled workers.
All of the above points mean that many organizations compete in what is often
described as the secondary labour market.
The internal labour market and the utilization of
flexible labour
Whilst the description of the broader context, as represented by the transnational,
national and sectoral labour markets, is important, we should also consider some
of the choices that organizations themselves will make in developing their internal
labour market. Riley (1996: 12) describes the internal labour market in the follow-
ing manner:
The concept of the internal labour market is based on the idea that sets of
rules and conventions form within an organization which act as allocative
mechanisms governing the movement of people and the pricing of jobs. Such
rules are about promotion criteria, training opportunities, pay differentials
and the evaluation of jobs, but most importantly, they are about which jobs
are ‘open’ to the external labour market.
Traditionally many tourism and hospitality organizations have failed to develop
strong internal labour markets, where skills are developed maximally via internal
promotion and upgrading, and managers have relied instead on the external labour
market, which is cheaper because labour is plentiful. Another aspect of the internal
labour market is the choices that organizations may face in their use of various form
of flexibility.
As we noted above the aim of much of the legislation of the Conservative
Governments of the 1980s and 1990s was to increase the flexibility of the labour
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LABOUR MARKETS 81
market. As Kelliher and Riley (2003: 99) note, ‘Flexibility was seen as a means of
enhancing competitiveness and adapting to changes in the business environment’.
Much of the debate generated about the nature of flexibility in organizations was
developed with recourse to the highly influential work of Atkinson (1984), which
proposed the ‘flexible firm’ model. Although subsequently heavily criticized, the
model does usefully distinguish between ‘core’ and ‘peripheral’ employees. The
former group are characterized as being permanent, usually full-time, staff that
are viewed as a valuable resource, likely to be multi-skilled and enjoying employ-
ment security and career progression. By contrast, the latter group are likely to be
part-time or casual, enjoy little employment security, have fewer skills and be eas-
ily disposable, reflecting Wood’s view of marginal workers described earlier. In
reality, as with other ideal types described in this book, these descriptions tend to
oversimplify the nature of core and peripheral staff in hospitality and tourism
(Deery and Jago, 2002). For example, Walsh (1990) has described how staff that
would be thought of as ‘peripheral’ will often be integral to the running of a hotel
and may be equally committed to the organization as core staff. Nevertheless, the
notion of core and peripheral workers is useful in pointing to the types of labour
flexibility utilized by tourism and hospitality organizations, two of the most
prominent being functional and numerical flexibility.
Functional flexibility
Functional flexibility is seen as the employer’s ability to deploy employees, and
more specifically core employees drawn from the primary labour market, between
activities and tasks. In increasing the range of tasks that an employee can under-
take employers will expect employees to be capable of working in different func-
tions within the same department, or even work between departments. Such an
approach can lead to increased skills, job satisfaction, more meaningful work and
enhanced career prospects for employees. Many descriptions of functional flexi-
bility in the tourism and hospitality sector, though, have pointed to a rather ad
hoc approach, which may be more about covering short-term problems rather
than creating a genuinely multi-skilled employee. This point has led Riley (1992)
to describe true functional flexibility within tourism and hospitality as being a
‘Cinderella idea’. However, Kelliher and Riley (2003) report research from four
case study organizations in the hospitality industry who had enjoyed benefits to
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HRM in practice 4.5 Marriott Marble Arch:
Aiming to multi-task and multi-skill
Lowe (2002) recognizes that, as with every other tourism and hospitality organization,
the London Marriott Marble Arch hotel has to cope constantly with staff recruitment,
retention and motivation to maintain high standards of customer services. The four-star
hotel introduced a cross-training scheme to improve the skills of its employees to help
them cope with the requirements of their job roles.
To improve their staff recruitment and retention, the Marble Arch hotel set up its
cross-training Discovery scheme. The programme was designed to increase staff skills
and to ease career promotions into higher or sideways positions through developing
employee skills in other areas. Last but not least, it also endeavoured to base labour
scheduling on a flexible, multi-skilled workforce, allowing the hotel to use its employees
in the most cost-effective manner. The scheme was targeted at every employee and was
completed during normal working hours. Overall, it took more than 320 hours, spread
over 40 one-day sessions, for the hotel to complete their Discovery cross-training. At the
end of the formal training each participant received individual feedback and a certificate
of achievement. The HR department was involved in co-ordinating the scheme, liaising
with heads of departments and getting constructive feedback from participants in order
to control and modify the scheme. Parallel to this, further developments were intro-
duced, such as a 2-week critical cross-training session was added to new associates’
90-day induction plan in order to make them develop skills within their critical departments.
For instance, new restaurant employees were supposed to spend time in the kitchen, bar
and banqueting areas. In addition, the programme was made available all the year and
HR ensured employees had completed their cross-training before letting them move
within departments.
The Discovery scheme led to substantial improvements. It impacted positively on
two performance measures. First, the programme improved the Balanced Score Card, a
tool used for measuring and communicating hotel performance at Marriott hotels.
both employers and employees in introducing functional flexibility. Employers
reported more efficient use of labour, lower labour costs, better operational func-
tioning, improved customer service, reduced levels of labour turnover and an
improvement of their position in the local labour market. Employees also reported
increased job satisfaction, greater job security and enhanced remuneration (and
see also HRM in practice 4.5).
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LABOUR MARKETS 83
Second, the results of an annual employee survey significantly improved. Employees felt
that training to carry out daily tasks improved, raising its score from 21 to 87 per cent.
They also believed their opportunities to develop their career had increased by 4 per cent
and 84 per cent felt that they had accessible job opportunities compared to only 9 per
cent before the introduction of the scheme. As Lowe, HR manager at the hotel, com-
ments, ‘The initiative has proved invaluable to the London Marriott Marble Arch hotel. It
is a concept that could easily be adapted to other businesses to help meet the constant
challenge of staff recruitment and retention’ (p. 14). Indeed, the hotel was awarded the
large establishment category prize at the large annual Excellence through People Awards
held by the British Hospitality Association in 2002.
Numerical flexibility
Numerical flexibility refers to the capacity of employers to adjust labour supply to
fluctuations in business demand, which may equal less job security, low pay, lack of
opportunities for training and career advancement for employees. Unsurprisingly
given this description the peripheral workforce is most often associated with numer-
ical flexibility. In pursuing numerical flexibility employers can look to either internal
or external means (Lai and Baum, 2005). Internal means are largely concerned with
the use of ‘non-standard employment contracts’, such as part-time and shift work-
ing and the use of temporary and casual workers. External means include aspects
such as contracting out services, for example a hotel contracting out its leisure facil-
ities, and the use of agency staff (and see HRM in practice 4.6).
In addition to functional and numerical flexibility, tourism and hospitality
organizations can also use temporal flexibility, such as annual hours contracts and
job sharing; and pay flexibility, for example enhanced payments in return for being
functionally flexible.
It is interesting here to briefly think about the descriptions of flexibility within
our earlier discussion of hard and soft HRM. As we noted in Chapter 1 hard and
soft HRM allow us to appreciate that the reason for organizations adopting certain
HR practices may vary. Based on our description of the two approaches we could,
rather crudely, characterize numerical flexibility as being largely about hard HRM.
This hard approach emphasizes the use of labour which is aimed at reducing
labour costs, either by the most efficient use of labour or alternatively its most
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 84
effective exploitation. In this view approaches to flexibility will be concerned with
minimizing labour costs and ensuring the size and mix of labour inputs is adjusted
to changes in product demand. On the other hand, the soft approach is more con-
cerned with broadening employees’ skills through training to create workforces
which are flexible. Such a description is more concerned with functional flexibility.
As we have seen the most frequently utilized method of flexibility in the tourism
and hospitality industry is numerical flexibly, which is often characterized by low-
paid, low-skill, casual and part-time operative level work. An example of such an
approach would be a pool of available staff that could be called in at short notice
to work in the organization, for example, in the banqueting department of a hotel.
Indeed, many have argued that talk of flexibility and core and peripheral workers
induces nothing more than an ominous sense of déjà vu within the tourism and
hospitality industry. Due to the nature of the industry, patterns of employment
within tourism and hospitality have largely been arranged in a way that promotes
a high degree of employment flexibility, through the use of employment practices
that have often left individual workers with limited opportunities for advance-
ment and low job security. Wood (1997: 168), for example, argues that, ‘Flexible
working practices in the commercial hotel and catering sector are not new to the
industry, the use of part-time casual and part-time workers and multi-skilled staff
being a common and arguable defining feature of labour organization in some
sectors, most notably small hotel business’.
HRM in practice 4.6 Just in time labour supply
in the hotel sector
Many four- and five-star hotels will often rely on agency staff recruited from employment
agencies, particularly in areas such as housekeeping. Research by Lai and Baum (2005)
suggests that hotels can reduce labour costs by utilizing agency staff thus avoiding having
to pay fringe benefits such as sickness cover, pension contributions, maternity leave pay-
ments and holiday entitlements, all of which are covered by the employment agency.
Additionally, HR activities such as recruitment and selection, induction and training are
often undertaken by the agencies. Lai and Baum suggest that one hotel in their research
saved up to £500000 a year in housekeeping payroll costs. In addition to cost savings, Lai
and Baum also found that agency staff had often worked for the same hotel for a num-
ber of years with the consequence that quality and performance were improved.
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LABOUR MARKETS 85
Conclusions
We have outlined a fairly bleak scenario of what traditionally the organizational
characteristics of the tourism and hospitality industry have meant for those work-
ing in the industry. The tendency to short termism and ad hocism is the key feature
of labour markets in the industry. Management responses to these issues are also
similarly short term and ad hoc, with their role often being one of responding to situ-
ations and unanticipated crises, or trying to cope with varying demand. This, of
course, leaves us with an obvious paradox, namely how can the tourism and hos-
pitality industry compromise the need for staffing flexibility with the attainment
and maintenance of a quality service and product to the customer? There are no
easy answers to this conundrum and even a cursory understanding of the nature of
labour markets in tourism and hospitality allows us to appreciate this point.
References and further reading
Adler, P. and Adler, P. (2004) Paradise Laborers: Hotel Work in the Global Economy, Cornell University Press.
Atkinson, J. (1984) ‘Manpower strategies for flexible organizations’, Personnel Management, 16(8), 28–31.
Baum, T. (2002) ‘Skills and training for the hospitality sector: a review of issues’, Journal of Vocational
Education and Training, 54(3), 343–363.
Cabinet Office (2003) Ethnic Minorities and the Labour Market, Cabinet Office.
Cottell, C. (2005) ‘An industry in need of serving suggestions’, Guardian Work, 26 March, 21.
Deery, M. and Jago, L. (2002) ‘The core and periphery: an examination of the flexible workforce model in
the hotel industry’, International Journal of Hospitality Management, 21(4), 339–351.
Groskop, V. (2006) ‘Mamafesto’, New Statesman, 17 July, 26–28.
Gunn, J. (2004) ‘New EU states workers could ease jobs crisis’, Caterer and Hotelkeeper, 5 August, 7.
Hurrell, S. (2005) ‘Dilute to taste? The impact of the working time regulations in the hospitality industry’,
Employee Relations, 27(5), 523–546.
Kelliher, C. and Riley, M. (2003) ‘Beyond flexibility: some by-products of functional flexibility’, Service
Industries Journal, 23(4), 98–113.
Lai, P. and Baum, T. (2005) ‘Just-in-time labour supply in the hotel sector: the role of agencies’, Employee
Relations, 27(1), 86–102.
Lowe, C. (2002) ‘Marriott’s cross-training’, Leisure and Hospitality Business, 29 November, 14.
Meiklem, P. (2004) ‘Highland hospitality … courtesy of Eastern Europeans’, Sunday Herald, 14 November, 9.
Riley, M. (1992) ‘Functional flexibility in hotels – is it feasible?’, Tourism Management, 13(4), 363–367.
Riley, M. (1996) Human Resource Management in the Hospitality and Tourism Industry, Butterworth-
Heinemann, 2nd edition.
Walsh, T. (1990) ‘Flexible employment in the retail and hotel trades’, in A. Pollert (ed.) Farewell to Flexibility,
Blackwell, 140–150.
Warren, C. (2004) ‘Continental drift’, People Management, 6 May, 28–33.
Wood, R. C. (1997) Working in Hotels and Catering, International Thomson Press, 2nd edition.
Ch04-H6572.qxd 11/22/06 5:50 PM Page 85
Websites
The International Labour Office produces an annual labour market indicator and details of this and other
aspects of their work on labour markets can be found at http:/ //www.ilo.org/public/english/employment/
strat/kilm/
The European Foundation for the Improvement of Living and Working Conditions has some interesting
material and other links at http:/ //www.eurofound. eu.int/areas/labourmarket/index.htm/
The UK Government’s official statistics website http:///www.statistics.gov.uk/cci/nscl.asp?id?5006 has some
interesting labour market statistics.
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Chapter 5
Recruitment and
selection
Chapter objectives
This chapter addresses recruitment and selection
in the tourism and hospitality industry. In
particular the chapter aims:
? To understand the differences between, yet
complementary nature of, recruitment and
selection.
? To appreciate the importance of job descriptions
and person specifications/competency profiles
in recruitment and selection.
? To recognize the type of people and skills that
tourism and hospitality organizations are
seeking.
? To consider the range of selection techniques
available to tourism and hospitality
organizations.
87
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Introduction
Generally recruiting and selecting people to fill new or existing positions is a cru-
cial element of human resource activity in all tourism and hospitality organiza-
tions, irrespective of size, structure or activity. Although we have noted how the
importance of service quality has increased the pressure on organizations to select
the ‘right’ kind of individual, it is often widely suggested that too often decisions
are made in an informal, ad hoc and reactive manner. This point may be especially
true in smaller organizations that may not have well developed HRM functions or
recruitment and selection systems, and may recruit irregularly with heavy reliance
on informal systems and methods (Jameson, 2000). Indeed, within the context of
the hospitality sector, Price (1994) found that of 241 hotels sampled in her research,
a third never used job descriptions or person specifications. More recently,
Lockyer and Scholarios (2005) surveyed over 80 hotels and again found a general
lack of systematic procedures for recruitment and selection. This lack of system-
ization may seem strange when many writers would point to the cost of poor
recruitment and selection being manifested in such things as:
? expensive use of management time;
? retraining performers;
? recruiting replacements for individuals who leave very quickly;
? high-labour turnover;
? absenteeism;
? low morale;
? ineffective management and supervision;
? disciplinary problems;
? dismissals.
Clearly then it is important for organizations to consider how they can approach
recruitment and selection to increase the likelihood of a successful appoint-
ment/decision and in a cost effective manner. Reflecting this latter idea of cost
effectiveness it is important to recognize the contingent nature of recruitment and
selection. Thus, although there may be good practice approaches to recruitment
and selection these are not going to be appropriate for all positions available in an
organization. For example, for a management traineeship in a major hotel the com-
pany may use a variety of sophisticated and costly mechanisms culminating in
an assessment centre. On the other hand for a part-time seasonal position in a
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RECRUI TMENT AND SELECTI ON
fairground the company may recruit an employee based on word of mouth.
Indeed, in considering why it may be difficult for tourism and hospitality compa-
nies to aim for best practice in recruitment and selection Lockyer and Scholarios
(2005) recognize that the lack of formality can often be overcome by effective use of
local networks in recruiting employees. For example, they suggest that the person
responsible for selection should have a good knowledge of the local labour market
and be able to make the best use of informal networks to find suitable employees.
Afurther point to consider by way of introduction is the notion of ‘fit’ between
the individual and the organization who are seeking to attract and admit those who
are considered ‘right’ for the organization, in terms of issues like commitment, flexi-
bility, quality, ability to work in a team and so on. Thus, the match between the indi-
vidual and organization may be ‘loose’, that is applicants having the ability to do the
job; or ‘tight’, where the individual has to demonstrate not only technical competence
but whether they have a specific personality profile to ‘fit’ the organizational culture,
as discussed in Chapter 3. In such circumstances clearly there is the possibility to see
the notion of tight fit between organization and individual in a slightly sinister way
and we will consider this point throughout the chapter. Relatedly, there is the idea of
discrimination being a key issue within the recruitment and selection process. Of
course, at one level recruitment and selection is inherently discriminatory as, at times,
organizations will have to choose between two or more applicants for a job, particu-
larly for managerial positions. Crucially though such discrimination should be based
on the applicants ability to do the job. Thus companies are discriminating all the time
89
HRM in practice 5.1 Skills involved in the
recruitment and selection process
The recruitment and selection process The skills required
Job description Evaluation of the vacancy
Person specification Drafting the criteria
Advertisement Summarising
Shortlist Fair discrimination
Interview Questioning skills
Selection tests Listening skills
References Assessment skills
Decision Evaluation
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 90
on the basis of whether or not candidates have the attributes and skills to do the job,
but this should not contravene statutes in areas such as race, sex and disability (and
see Chapter 6). One final point by way of introduction is to recognize the range of
skills which managers need in the recruitment and selection process. As many line
managers in tourism and hospitality, as well as human resource specialists, are
increasingly involved in recruitment and selection it is important that they should
recognize the skills required in such a process (and see HRM in practice 5.1).
Recruitment
Recruitment is defined by Heery and Noon (2001: 298) as ‘the process of generat-
ing a pool of candidates from which to select the appropriate person to fill a job
vacancy’. In essence, in the recruitment process organizations are seeking to attract
and retain the interest of suitable candidates, whilst at the same time also seeking
to portray a positive image to potential applicants. Of course, recruitment is a
dynamic process as within organizations people are constantly retiring, resigning,
being promoted or, at times, being dismissed. Equally, changes in technology, pro-
cedures or markets may all mean that jobs are re-configured and become available
to the external labour and thereby trigger the recruitment and selection process.
Having decided to recruit, organizations will ordinarily consider a range of ques-
tion to determine how they might approach filling the vacancy. Specifically, they
might ask themselves the following questions:
? What does the job consist of?
? What are the aspects of the job that specify the type of candidate?
? What are the key aspects of the job that the ideal candidate wants to know
before applying?
Conventionally the answers to these questions will be provided by job analysis,
the job description and person specification, which allow the candidates to gauge
their chances of being appointed.
Job analysis
Armstrong (1999: 190) defines job analysis as ‘the process of collecting, analysing
and setting out information about the contents of jobs in order to provide the basis
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for a job description and data for recruitment, training, job evaluation and perform-
ance management’. Marchington and Wilkinson (2005) suggest that undertaking a
job analysis may not be necessary for every time a vacancy arises, especially in
organizations that have high levels of labour turnover. However, they do recognize
that job analysis does allow for an examination of whether existing job descriptions
and person specifications/competency profiles are appropriate for future needs.
The same authors also recognize that there is likely to be variation in terms of the
sophistication, cost, convenience and acceptability of job analysis and this will also
determine the methods utilized to analyse a job. Organizations may use one or more
of the following methods: observation of the job, work diaries, interviews with job
holders and questionnaires and checklists. The output from such job analysis is the
job description and person specification.
Job description
Heery and Noon (2001: 186) describe the job description as, ‘Adocument that out-
lines the purposes of the job, the task involved, the duties and responsibilities, the
performance of objectives and the reporting relationships. It will give details of the
terms and conditions, including the remuneration package and hours of work’. In
many respects the job description can be thought of as a functional document
which outlines the ‘what’ elements of a job. It should aim to provide clear infor-
mation to candidates about the organization and the job itself, such that it acts as a
realistic preview of the job. Importantly, as well as offering a realistic description
of the nature of the job, the job description should also act as a marketing docu-
ment that seeks to make the job look attractive to potential applicants.
Person specification/competency profile in the recruitment context
Whilst the job description considers the ‘what’ aspects of the job, the person spec-
ification is concerned with the ‘who’. In this way the person specification should
aim to provide a profile of the ‘ideal’ person for the job. In reality, the ideal person
may not exist, but the person specification provides a framework to assess how
close candidates come to being the ideal. Conventionally the person specification
is a document which describes the personal skills and characteristics required to
fill the position, usually listed under ‘essential’ and ‘desirable’ headings. In that
RECRUI TMENT AND SELECTI ON 91
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sense essential criteria form the minimum standard expected for any given job and
will form the basis for potentially rejecting applicants. For example, if an advert
for a tour company manager stipulates a degree in a travel and tourism-related
area, then non-degree holders would be automatically excluded. On the other
hand the desirable criteria are those things which are considered over and above
the minimum and should provide the basis for selection. For example, an organi-
zation may stipulate that for the same managerial job we have just outlined that a
foreign language is desirable. If a candidate had a foreign language they may be at
an advantage to other candidates who do not, though ultimately the company
may appoint somebody who does not have a language.
The two most important person specification models are those provided by
Alec Rodger in 1952 and John Munro Fraser in 1954 (Torrington et al., 2005).
Rodger seven-point plan
1 Physical characteristics – such as the ability to lift heavy loads or appearance,
speech and manner.
2 Attainments – educational/professional qualifications, work experience considered
necessary for the job.
3 General intelligence – such as the ability to define and solve problems.
4 Special aptitudes – skills, attributes or competencies relevant to the job.
5 Interests – work related or leisure pursuits that may have a bearing on the job.
6 Disposition – job-related behaviours, for example demonstrating friendliness.
7 Circumstances – for example domestic commitments or ability to work unsocial
hours.
Munro Fraser five-fold grading system
1 Impact on other people – similar to Rodgers physical make-up.
2 Qualifications and experience – similar to Rodgers attainments.
3 Innate abilities and aptitude – similar to Rodgers general intelligence.
4 Motivation – a person’s desire to succeed in the workplace.
5 Adjustment – personality factors that may impact on things like ability to cope
with difficult customers.
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More recently, Marchington and Wilkinson (2005) note how many companies now
use competency frameworks to outline the type of person that they are seeking.
The focus of competency frameworks is on the behaviours of job applicants and
they are useful as they can also set a framework for other subsequent HR practices,
such as performance management and pay. Marchington and Wilkinson (2005:
169) also note how, ‘the competencies can be related to specific performance out-
comes rather than being concerned with potentially vague processes, such as dis-
position or interests outside of work’. The use of competencies tends to focus on
areas such as team orientation, communication, people management, customer
focus, results orientation and problem-solving.
Regardless though of whether organizations are using person specifications or
competency frameworks, tourism and hospitality organizations are now seeking
employees, especially those who will interact with customers, with certain types
of skills.
The ‘ideal’ front-line tourism and hospitality employee
With the shift to a service economy the type of skills demanded by employers has
also shifted. Employers in hospitality and tourism in both the UK and elsewhere
increasingly desire employees with the ‘right’ attitude and appearance (Chan and
Coleman, 2004; Nickson et al., 2005). The right attitude encompasses aspects such
as social and interpersonal skills, which are largely concerned with ensuring
employees are responsive, courteous and understanding with customers, or in sim-
ple terms can demonstrate emotional labour. However, it is not only the right atti-
tude that employers seek. Nickson et al. (2001) have developed the term ‘aesthetic
labour’ – the ability to either ‘look good’ or ‘sound right’ (Warhurst and Nickson,
2001) – which points to the increasing importance of the way in which employees
are expected to physically embody the company image in tourism and hospitality.
Review and reflect
What are the types of skills that tourism and hospitality organizations are likely to seek in
their front-line staff? How can these skills be discerned in the recruitment and selection
process?
RECRUI TMENT AND SELECTI ON 93
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In an analysis of 5000 jobs advertisements across a number of different occu-
pations and sectors in the UK, Jackson et al. (2005) found that the skills stated as
necessary by employers are ‘social skills’ and ‘personal characteristics’; only 26 per
cent of organizations mentioned the need for educational requirements. Within
personal services this figure was less than 10 per cent. Furthermore Jackson et al.
found numerous instances of front-line service jobs asking for attributes that
referred less to what individuals could do than to what they were like, such as
being ‘well-turned out’ or ‘well-spoken’, or having ‘good appearance’, ‘good
manners’, ‘character’ or ‘presence’.
Nickson et al. (2005) also report evidence from a survey of nearly 150 employ-
ers in the retail and hospitality industry. On the question of what employers are
looking for in customer facing staff during the selection process, Nickson et al.
found that 65 per cent suggested that the right personality was critical, with the
remainder of respondents suggesting this aspect was important. Equally, 33 per
cent of the employers surveyed felt that the right appearance was critical and
57 per cent as important, only 2 per cent of respondents felt it was not important.
These figures can be compared to qualifications, with only one respondent seeing
qualifications as critical, 19 per cent of employers felt it was important and 40 per
cent suggested it was not important at all for selecting their customer facing staff.
In terms of the skills deemed necessary to do the required work, employers
placed a far greater emphasis on ‘soft’ skills for customer facing staff. Ninety-nine
per cent of respondents felt that social or interpersonal skills were felt to be of at
least significant importance, and 98 per cent felt likewise about self-presentation,
or aesthetic, skills. Conversely 48 per cent of employers felt that technical skills
were important in their customer facing staff and 16 per cent stated they were not
important at all. The skills that matter to employers in customer facing staff in
tourism and hospitality are generally then ‘soft’, including aesthetic skills, rather
than ‘hard’ technical skills, which will often be trained in when people join the
organization (and see HRM in practice 5.2).
Of course we should recognize that the use of person specifications and com-
petency frameworks may still involve a degree of subjectivity, especially in judg-
ing which potential employees have the ‘right’ kind of attitude or appearance.
Evidence suggests that employers will often make judgements which penalize
people for not having the ‘right’ appearance or attitude (Nickson et al., 2003).
Clearly, then, there is the potential for overt and not so overt forms of discrimina-
tion in how person specifications and competency frameworks may be used by
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HRM in practice 5.2 ‘Scotland with Style’:
aesthetic labour and employees who
look good and sound right
Glasgow was once an industrial city. Now, over 85 per cent of the city’s jobs are in serv-
ices. Aiming for the city break tourist market, the city promotes its retail, cultural and
hospitality attractions. Between 1994 and 2000, the number of major hotels in the city
increased from 42 to 89, with 27 more planned. Glasgow has approximately 1000 bars
and restaurants and is second only to London as Britain’s culinary capital. Similarly,
Experian acknowledges Glasgow as the second largest retail centre in the UK outside
London. The city also now has a well-developed niche of designer retailers, boutique
hotels and style bars, cafes and restaurants. Not surprisingly, the city was recently
described by US magazine Travel and Leisure as ‘The UK’s hippest and most happening
city’. Three million tourists visit the city each year, generating £670 m annually in the local
economy. In recognition of this new economic success, the city re-branded itself as
‘Scotland with Style’ in 2004.
To take advantage of this booming tourist market and reflecting the city’s new
image, tourism and hospitality employers want staff with the right customer service
skills. Job adverts specify that applicants be ‘well spoken and of smart appearance’ or
‘very well presented’. One Scottish-based boutique hotel company, known pseudo-
nymsly as Elba, has created a sophisticated recruitment, selection and training pro-
gramme for its new staff. Elba has hotels in two Scottish cities and has expanded into
England and France. Opening a new hotel in Glasgow, the company deliberately placed
job advertisements in the Sunday Times rather than local evening newspapers. Opening
a hotel in Newcastle, England, it placed TV adverts during programmes aimed at the
youth market. As a consequence, its typical front of house employee is in his or her twen-
ties, a graduate and well travelled. Recruitment literature featured a person description
not a job description, asking applicants to assess themselves by the 13 words that char-
acterized that company’s image; ‘stylish’ and ‘tasty’ for example. After a telephone inter-
view, application with CV and then a face-to-face interview, there was a 10-day
induction at the Glasgow hotel in which extensive grooming and deportment training
was given to the staff by external consultants. Sessions included individual ‘make-overs’
for staff, teaching them about hair cuts/styling, teaching female staff about make-up,
male staff how to shave and, for all, the expected appearance standards. The sessions
were intended to relay ‘this is what we want you to actually look like ... you have to
understand what “successful” looks like ... what “confident” looks like.’ The hotel
wanted staff that were confident, with a good attitude and appearance. ‘There is an Elba
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those making the final decision about who is to be employed by the organization,
a point considered in further detail in Chapter 6.
Ultimately in considering the person specification or competency profile it
would seem sensible for organizations to consider several points.
? Are all the items on your person specification/competency profile relevant to
the job?
? Are you reasonably sure that none of your criteria would discriminate unfairly
against a group of potential candidates?
? Would your person specification/competency profile enable a shortlisting and
interviewing panel to distinguish clearly between candidates?
Having reviewed the importance of the job description and person specification/
competency requirements we can now move on to consider how organizations can
attract the interest of appropriate potential employees. Initially, there may be a
choice as to whether the organization looks to somebody within the organization or
alternatively looks to the external labour market. For example, for a promotable
position organizations which are seeking to sustain a strong internal labour market
may have a policy to offer this position in-house first to existing staff. Equally,
though, the organization may feel that offering such positions to the external labour
market is important to bring in new ideas and new blood to the organization. In
deciding their target group organizations may also wish to address issues such as
under representation of a particular group, for example ethnic minority employees
or women managers, a point that is further considered in the following chapter.
Generally speaking organizations have a number of methods which they can
consider in seeking to engage with their target market for new employees. First, as
we have already noted they may use existing employees. For example, this can be
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 96
look’, said the hotel manager, ‘neat and stylish…young, very friendly ... people that fit in
with the whole concept of the hotel’ (Nickson et al., 2001: 180). The hotel wanted staff
able to project the company’s image and help it differentiate itself in a crowded and com-
petitive market. It is a policy that seems to pay: the hotel claims above average occu-
pancy rates for the city.
Derived from Nickson et al. (2001, 2005).
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RECRUI TMENT AND SELECTI ON 97
in relation to promotable positions or also in terms of word-of-mouth approaches,
which are commonplace in tourism and hospitality, especially for front-line posi-
tions. Alternatively the organization may choose to use external contacts, such as
job centres. Indeed, this may well be something that organizations see as impor-
tant in their attempts to be good corporate citizens (and see HRM in practice 5.3).
HRM in practice 5.3 Jurys Inns: offering
a helping hand to the unemployed
The Jurys Inn hotel is a three-star plus hotel chain targeting business travellers and leisure
guests. It is the key brand of the Irish Jurys Doyle Hotel Group PLC that owns and oper-
ates three-, four- and five-star hotels in the UK, Ireland and the US, and has a workforce
of 4000 employees. As any other companies in the highly competitive and unstable hos-
pitality sector, the Jurys Inn hotel had to develop a successful strategy to stand out from
the competition and weather the economic slowdown. Among the strategic initiatives
was a recruitment and training strategy aimed at improving the quality of customer serv-
ice. Every time Jurys Doyle Hotels opens a new Jurys Inn, they rely on key local employ-
ment providers, such as the Job Centre Plus, the local council and a local training
provider, such as a college, to develop a gateway training programme for people willing
to move into the hotel industry. Applicants who have passed the initial sifting process are
then invited to an 8-week pre-employment training programme run in partnership
between Jurys Doyle Hotels and the training provider. This programme has proved suc-
cessful since it was first launched in 1993 and 20 people who are currently working in
the company are estimated to have joined the pre-employment scheme. It is now esti-
mated that there are, on average, 30 places available at each new Inn, representing
25 to 50 per cent of the staff base. After the pre-employment period, successful candidates
and other new recruits alike join the Guest Service Staff (GSS) training 4 weeks before an
opening. The main objective of this scheme is to develop a multi-skilled team able to
operate within all areas of the hotel. Furthermore, the programme has no time limit and
is available for every employee willing to advance their career. Finally, to make sure
its employees are the most effective in the industry, Jurys Doyle Hotel strive to ensure
that their staff gain external or professional qualifications such as National Vocational
Qualifications (NVQ) or CIPD qualifications.
Jurys Inn’s recruitment and training strategy has helped them expand in a recent
context of economic slowdown. Aside from building Jurys Inn’s skill base, the pre-
employment scheme has contributed to creating jobs in cities often hit by unemployment,
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 98
thereby improving employee loyalty to the hotel. In addition, it involves new recruits in
the development of the building in which they are to work. This helps build the involve-
ment of employees who might have had doubts about the scheme or working in a hotel.
On the other hand, the GSS training aimed at developing multi-skilled staff, is beneficial
both to the employer, who seek to maximize the use of its workforce, and to the employee
who gains diverse levels of experience and benefit from more flexible working hours, as
they are able to take on a number of different roles. As Edward Gallier, development and
training manager for the UK and Ireland, puts it, ‘Our employees can work anywhere in the
Inn ... this means we have GSS who can deliver the services of a receptionist, room atten-
dant or porter equally well, with the confidence good training gives them’.
Source: Gallier (2004).
Afurther key aspect of looking externally for new employees is the importance
of advertising and media. An obvious starting point here is the printed media and
specifically the press. The use of the print media to advertise jobs is one of the most
popular formal methods of recruitment. When thinking about where adverts are best
placed organizations need to be cognizant of the labour market on which they are
hoping to draw for a particular job. In recognizing the most appropriate labour mar-
kets organizations could conceivably place adverts in either the local/national press
or in trade and professional journals. For example, for a front-line position it is likely
that the local press will be used, whilst for a managerial or specialist position the use
of the national press or trade press may be more appropriate. In using the printed
media it is important to consider the manner in which organizations can portray the
desired image and here we will consider how this issue can be addressed.
When organizations advertise vacancies it is important that they convey the
right message in order to attract suitable applicants and discourage those who do
not have the necessary attributes. Equally important is that advertisements project
a positive image of the company and in that sense adverts can be considered a sell-
ing document. Initially organizations have the choice to get it alone and contact
the media directly or alternatively they can deal with an advertising agency, who
can help in drafting and placing an advert. Advertising agencies can be thought of
as experts who can offer advice on the choice of advertising copy and the choice of
media. They may also have better contacts to ensure advertising space at short
notice. The only drawback is that agencies may also be rather costly. Regardless of
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whether an agency is used or not there are certain key points which should be
borne in mind in devising an advert and at the very least the following aspects
should be apparent (Torrington et al., 2005: 128).
? Name and brief details of the employing organization.
? Job role and duties.
? Key points of the person specification or competency framework.
? Salary.
? Instructions about how to apply.
Moreover organizations should also consider the image they are portraying and
the CIPD and the Institute of Professional Advertisers (IPA) outline the following
criteria for judging excellence in recruitment advertising (CIPD, 2006):
? visual impact,
? typography and balance,
? clarity of message to the target audience,
? promotion of job vacancy,
? projection of a professional organizational image,
? focus on workplace diversity.
With regard to that last bullet point it is important to reiterate that adverts must not
discriminate on grounds of sex, race, sexuality, religious orientation and disability.
In addition there are other areas which can potentially be used including TV,
radio, cinema, careers exhibitions, conferences and open days and posters. Whilst
TV, radio and cinema adverts have been utilized to recruit in areas like the military
or teaching they are much less likely to be used by tourism and hospitality
organizations. The other aspects though could all be conceivably used. For example,
Review and reflect
Using the above criteria attempt to find a job advertisement for a tourism and hospital-
ity organization which exemplifies at least some of these aspects and briefly describe why
these aspects makes a job look attractive.
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TGI Fridays, the American restaurant chain, have successfully used open days to
recruit staff in the UK. As a company with a very distinctive service style open
days are felt to be useful to expose potential employees to the nature of the work
they will be undertaking. As the company is looking for very outgoing individu-
als who can do things like juggle or sing whilst serving customers the open day is
designed to assess such aspects. Team tasks and tricks and dances are just some of
the things that potential employees will be expected to demonstrate in their ‘audi-
tion’ during the open day (Baker, 1999; and see HRM in practice 5.4).
Another source of recruitment is increasingly the Internet. IDS (2003) have
recently noted how the use of the Internet in recruitment has tended to be comple-
mentary to existing methods, rather than replacing them. In this sense, although
the Internet is playing a growing role in organizations recruitment strategies, its
importance should not be exaggerated. For most companies the use of Internet
tends to be in terms of sections on their websites that allow job seekers to check for
current vacancies. Beyond this facility there may be more strategic approaches in
using the web, particularly with regard to the ability to receive and process job
applications online, something which is outlined in HRM in practice 5.5.
Smethurst (2004) notes other reasons for employers, including Whitbread, for
using online recruitment, including:
? Reducing cost per hire.
? Increasing speed to hire.
? Strengthening the employer brand.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 100
HRM in practice 5.4 Who would you
most like to be stuck in a lift with?
Hills (2004) reports on the recruitment process in Tiger Tiger, which is one of the UK’s
most popular nightclub groups. As part of their recruitment process they host open days
to allow potential employees to sample the Tiger Tiger atmosphere. A general manager,
Beverley Harley, is quoted as saying, ‘the leisure sector is a particularly social and com-
petitive one and we’re on the hunt for hardworking team players’. As part of assessing
whether applicants have these attributes, during the open day potential employees take
part in various ‘fun’ activities, including being asked who they would most like to be
stuck in a lift with and which type of animal they would choose to be.
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RECRUI TMENT AND SELECTI ON 101
HRM in practice 5.5 Hilton International:
spreading the web
Beal (2004) notes how Hilton International wanted to improve its fast-track Elevator pro-
gramme – a selection tool introduced in 1998 and designed to recruit highly talented
graduates as future hotel general managers. As new graduates had to learn the role of
a manager in a short period of time, the tool had to be extremely reliable to pick up the
right candidates. As such, the Elevator scheme, which involved hand-processing and
scoring an application form, conducting a face-to-face meeting, psychometric testing
and conducting a final 24-h assessment centre, proved costly and time-consuming, espe-
cially in terms of senior management involvement.
To streamline its selection tool, Hilton International commissioned the business-
psychology consultancy Human Factor International to introduce a web-based screening
system – a so-called ‘virtual psychologist’ – running in five European languages. This online
tool would not have been possible without a technological breakthrough which allows for
a time limit on the intellectual-reasoning part of the test. The system was successfully
implemented in 15 working days, from Christmas 2003 to 20 January 2004. Since the run-
ning of the programme, Hilton has invited applicants through presentations at the main
European hotel schools and universities to apply through the website http://www.hilton-
university.com and complete the standard application form. Those who pass the initial sift-
ing are then asked to fill in online ‘personality’ and ‘workplace values’ questionnaires. At
this stage all candidates receive an electronic report analysing their results and providing
tailored career advice. Successful candidates are then invited to complete three ability and
skill tests of 15min each before being selected to the assessment centre. At the end of the
assessment centre unsuccessful candidates receive detailed e-mailed feedback outlining
the reasons why they have not been chosen and inviting them to phone in if they want to
have further explanations. As Christine Jones, Director of the Consultancy Human Factor
International adds, ‘Even unsuccessful candidates have told us they have been pleased with
the feedback they have been given, and are comfortable with it’ (p. 31).
By introducing the online system, Hilton has been able to reduce the number of assess-
ment days without damaging the quality of its new recruits. Indeed, the 14 graduates who
first joined Hilton through this tool had to pass only two final assessment centres rather than
the five or six previously needed. As John Guthrie, Head of International Management at
Hilton International comments, ‘While unlikely to save significant costs in pure cash terms,
getting rid of manual processes has freed up managers’ time to concentrate on more value-
adding work. Additionally, it helps to portray the organization as more contemporary and
technologically oriented and strengthens our appeal in a competitive search for talent’ (p. 31).
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? Greater flexibility and ease for candidates.
? Broaden the applicant pool.
Lastly, beyond individual company websites there are other commercial websites,
such as http://www.traveljobz.net/, which aims to allow job seekers to access
jobs in a wide variety of travel and hospitality jobs, including airlines, hotels, cruise
lines, restaurants and other travel companies.
We recognized earlier in the chapter how a key aspect of recruitment and selec-
tion was cost effectiveness. As a result it is not necessarily sensible to use certain
recruitment methods for certain jobs and in reality the aim should be to ensure the
best method to hit the particular target group for a particular job and in a cost effec-
tive manner. The recognition of the need for a contingent approach to recruitment is
apparent from the research outlined in Figure 5.1 (and see also HRM in practice 5.6).
At this juncture in the recruitment process the organization will hopefully
have generated sufficient interest from suitable applicants. In that sense it is
important for organizations to periodically review the recruitment process and
evaluate its effectiveness against this kind of criterion. Additionally, the organization
may also want to consider the issues of costs and equal opportunities issues.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 102
Local press
Word of mouth
Employment agencies
Trade press
National press
Personnel consultants
Others*
*Others represented internal sources and in one chain an in-house recruitment
centre.
Reprinted by permission from ‘Personnel management in hotels – an update:
a move to human resource management?’, Kelliher, C. and Johnson, K. (1997).
Copyright John Wiley and Sons Limited.
Job centre
30
35
57
66
24
42
22
13
Management (%)
80
70
32
26
8
2
22
87
Operative (%)
Figure 5.1 Sources of recruitment in the hospitality industry
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Ultimately in evaluating the process of recruitment organizations can ask them-
selves several key questions:
? Do recruitment practices yield sufficient numbers of suitable candidates to
enable the organization to select sufficient numbers of high-quality employees?
? Could a sufficient pool of suitable candidates be attracted using less expensive
methods?
? Are recruitment methods fulfilling equal opportunities responsibilities?
Depending on the type of job, and presuming that there is more than one candi-
date, the final part of the recruitment procedure is the notion of shortlisting. The
outcome of the recruitment process is to produce a shortlist of candidates whose
background and potential are in accordance with the profile contained in the person
specification/competency framework. Clearly this is a way of making good use of
the information gathered to date about the candidate. We can also appreciate the
RECRUI TMENT AND SELECTI ON 103
HRM in practice 5.6 ‘Realistic’ recruitment
in the cruise industry
Raub and Streit (2006) recognise that, as within other tourism and hospitality settings,
human resources are crucial to success in the cruise industry as guests are in constant con-
tact with service staff and unlike conventional hotels cannot usually wander ‘off site’.
Regardless of the likely pressure that this is likely to create for front-line service staff many
people might think that working in the cruise industry is likely to be exciting and fun. Life
on board a cruise ship though can be difficult for staff, for example they are likely to face
cramped and difficult living conditions. The unique work context in the cruise ship indus-
try means that many organizations attempt to offer a ‘realistic’ and ‘honest and objective’
view of working life in the industry, which means that staff do not have an unrealistic view
of working in the industry. Key to this approach is the use of several types of recruitment
media such as interviews, company-specific videos, company presentations, written infor-
mation (such as fact sheets) and web-based information. This realistic job preview is
placed alongside the positive aspects of the job, for example the manner in which work-
ing on cruise ships can significantly broaden the professional and individual horizons of
young employees. By balancing both positive and negative aspects of working in the
industry in this realistic manner companies seem to be able to lessen high levels of labour
turnover thus increasing retention and potentially enhancing job satisfaction.
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need to ensure that things have gone smoothly so far. In this sense if there has been
a problem, say with the advert, shortlisting can conceivably be a problem. If, for
example, there are insufficient number of candidates who are appointable or
indeed if there are too many candidates. Presuming that there are sufficient num-
bers of suitably qualified people for the position the conventional method is to
shortlist by comparison with the person specification/competency framework.
Torrington et al. (2005) though note that if there is a large number of people who
have applied for a job there may be fairly arbitrary criteria, such as people being
excluded because of their age or their handwriting style. As they recognize though
such shortlisting techniques are wholly unsatisfactory, being potentially both
unlawful and certainly unfair. Afairer approach is likely to be based on a rigorous
and systematic view of each candidate via five stages (Torrington et al., 2005: 136):
1 Essential criteria for shortlisting.
2 Individual selectors produce their own list of a given number of candidates.
3 Selectors reveal list and try to reach consensus, if still not clear.
4 Discuss why certain candidates are preferred and others not.
5 Produce final shortlist after negotiation and compromise.
We have now reached the stage where the organization is ready to move on to
selection.
Selection
To-date in this chapter we have essentially been examining the notion of recruitment
and how organizations attempt to attract the interest of potential employees. We can
now go on and examine the idea of how organizations match potential employees to
jobs, via the processes of selection when organizations will decide who is the most
appropriate person for the job. We will do this by contextualizing the process, and
then go on and look at some of the techniques utilized by organizations in selecting
new employees. We will then assess some of the possible problems within this process
and finally examine the way most organizations approach the idea of selection.
As Heery and Noon (2001: 320) note selection is, ‘the process of assessing job
applicants using one of a variety of methods with the purpose of finding the most
suitable person for the organization’. Increasingly many writers argue that the
selection of staff may well be the most important aspect of HRM as staff are
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increasingly expected to become effective immediately. Allied to this point is the
cost of various selection techniques which means organizations will want to get it
right first time. However, despite this recognition there is no one best way which
is universally recognized as the best method of selecting the right person for the
job. Torrington et al. (2005: 141) argue that, ‘the search for the perfect selection
method continues, in its absence HR and line managers continue to use a variety
of imperfect methods’. What this quote points to is that no one selection method
can guarantee success in terms of choosing the right person for the job, especially
given the level of human involvement in the process. As organizations recognize
this conundrum they are adopting a variety of techniques to address questions of
selection. Thus, the methods selected are influenced by the employer’s view of
what is required to provide a satisfactory basis for decision-making and awareness
of the appropriateness of particular techniques to provide what is sought. Before
we go on though and examine various selection techniques in detail it is important
to recognize two points which complete the context of the selection process.
The first idea is that the selection process is a two-way process. Often the per-
ception is that the organization has all of the power in the process of selection.
However, this is not strictly true, even though it may seem that way when you are
going through the process. Selection is in fact a two-way process, because people
have the option to pull out of the process or turn down a job. For example, a major
international hotel company may advertise a graduate trainee scheme and get an
initially good response, such that over 300 application packs are sent out to poten-
tial employees. Of those only 127 are returned. Following the selection process
23 are offered jobs, 19 accept the offer and only 15 actually start with the company.
What this example illustrates is that selection may also be occurring from the
employees’ point of view, especially when the labour market is buoyant or their
particular skills are in demand. The second point is the selection criteria. Selection
does not take place in a vacuum, there is also the context of whether the person
will fit in with the job requirements, so the person/job interaction is important. As
we have already noted there is also the question of whether the person will fit in
with the group or work team or department and will they be able to work with col-
leagues. Finally there is the question of whether the person will fit in with the
organizational culture and the way things are done in a particular organization.
The ways organizations attempt to find this out are myriad, and we can examine
some of the techniques that they utilize in the selection process. The first method,
which is the most popular, is that of interviewing.
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Although criticized, for example many argue interviewing is not very good in
predicting actual performance in the job, the interview is usually the central element
of the selection process in many tourism and hospitality organizations. Indeed, the
interview is often characterized as being the third part of the ‘classic trio’ of applica-
tion forms/CVs, references and interview. In that sense for many people their expe-
rience of the selection process will be filling in an application form, including
supplying two references and then going along to an interview. As far as selection
methods are concerned the interview is seen as the most straightforward and least
expensive approach and what most candidates would expect. Employers in the UK
often express concern about the fairness of psychometric testing and yet continue to
use and seem relatively happy about interviews, despite the potential for bias and
discrimination. The interview remains popular then despite poor evidence of valid-
ity and the fact that other methods have more predictive power in terms of job per-
formance. Regardless of the latter points the interview remains enduringly popular
as a selection tool, with 71 per cent of private service sector organizations using it as
part of the selection process (CIPD, 2004). Although increasingly more sophisticated
techniques are emerging, such as psychometric testing and assessment centres, they
are in addition to rather than replacing the interview.
Riley (1996) feels that the interview is sometimes unfairly criticized because too
much is expected of it, and it is also done badly. Equally, he also makes the point that
it is quick, convenient and when done well, an effective selection method. Riley
(1996) describes the interview as ‘Aconversation with a purpose’ and that purpose
is to assess four objectives:
1 To decide if an applicant is suitable for a job.
2 To decide if the person will fit into the existing work group or organization as a
whole.
3 To attract applicants to the job.
4 To communicate essential expectations and requirements of the job.
Review and reflect
Think about an employment interview that you have attended and whether you felt it was
a ‘good’ or ‘bad’ interview and what influenced your judgement, either positive or negative.
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Essentially then the interview process is about gathering information which
allows for an evaluation of the appropriateness of the individual for a particular
job. Interviews can either be one to one, sequential or phone and again is it likely
that for the majority of positions in tourism and hospitality the first type will pre-
dominate. To have a good interview regardless of which type it is, it is also
suggested that certain conditions should be met (Torrington et al., 2005). These
conditions are concerned with aspects such as attention being paid to noise levels,
avoiding interruptions, lighting, dress and manner of the interviewer, positioning
of furniture and attempts to create an informal atmosphere. These aspects are con-
cerned with taking away as much of the anxiety of the situation as is possible to
ensure interviewees perform to the best of their ability. Recognizing this point
there are several things which should be recognized in interviewing (IRS, 2000,
2006; Torrington et al., 2005: 201–215):
? Interviewers should only talk around 20 per cent of the time, the remaining
time should be filled by interviewees.
? Open questions are more useful, so questions starting with what, why, when,
which and how can be very useful to elicit information from candidates. For
example, instead of asking a question like ‘Did you enjoy your last job?’ the
interviewer could ask ‘What did you enjoy about your last job?’
? Interviewers recognize and like candidates from similar backgrounds to them,
in terms of things like social class and educational background.
? It is estimated that interviewers often make their decision within the first
4–9min of an interview.
? Interviewers are vulnerable to prejudices with regard to aspects such as sex,
race and age.
? Interviewers are affected by physical cues, for example spectacles equals
greater intelligence.
? Interviewers need to be aware of the ‘halo’ or ‘horns’ effect, when either in a
positive or negative manner, some trait or personal characteristic influences or
overwhelms all other thoughts.
? There is a need to recognize the importance of non-verbal communications, or
what is commonly described as body language. For example, interviewers and
interviewees should aim to be open in their stance and throughout the inter-
view sustain animated, yet controlled body language.
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Despite the many criticisms of the interview as a selection method it remains
extremely popular. It is worth remembering as well that often many of the criti-
cisms are largely about the interviewers themselves and not the process. As
Watson (1994: 211) aphoristically notes, ‘employment interviewing is like driving.
Most people rate themselves highly; the consequences of mistakes can be serious
and when something goes wrong there is a tendency to blame the other party’.
Similarly, Taylor (1998: 130) has suggested that, ‘individuals will not tolerate criti-
cisms of their performance as lovers, drivers or interviewers, since all such criti-
cisms strike deep into the core of the human ego’. As Riley (1996) argues although
interviews are subjective and require judgement so do other management activi-
ties and the real problem is not the interview but the way it is carried out. To con-
clude it is worth noting the view of IRS (2000: 12) who suggest that, ‘there are few
more complex, intuitive, intelligent or sophisticated information processors than a
competent and confident interviewer’. With the interview set to continue as an
integral part of the selection process it is important for individual managers to rec-
ognize the need to develop their interviewing skills as an essential part of their
managerial skillset.
Beyond interviewing there are a number of other techniques which organiza-
tions can conceivably utilize in selecting employees. An obvious aspect to this is
the use of tests and psychometric testing. In general a test may refer to something
like a dexterity test for a manually skilled employee or an attainment test, for
example typing skills. More specifically, psychological or psychometric tests are
tests which can be systematically scored and administered. These tests are used to
measure individual difference in aptitude, ability, intelligence or personality.
Organizations are increasingly using these types of tests, particularly for manage-
rial positions (IRS, 2002). That said, psychometric tests are a source of great debate,
particularly the use of personality tests. Much of this debate is concerned with
whether tests of this nature can genuinely predict future workplace behaviour.
Aptitude tests may test specific abilities in relation to verbal, numerical, spatial or
mechanical skills to provide an indication of how well applicants will cope with
the job. General ability or intelligence tests are used to test how well individuals
think on their feet and will be about analytical reasoning and ability to think criti-
cally. The most controversial tests are personality tests, which are often described
as Orwellian or biased, manipulative and intrusive as they attempt to assess how
people will cope with demands, or how people will cope with stress, rigidity or
attitudes to authority or creativity.
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There are a number of issues which arise in the use of personality tests. For
example, there are concerns about how comparable information is. Equally, there are
major concerns expressed by bodies such as the Equal Opportunities Commission
and Commission for Racial Equality about the gender and ethnic bias in tests (IRS,
2002; LRD, 2003). Lastly, a number of occupational psychologists have expressed
concerns at so-called off the shelf models, which may be used in organizations in an
inappropriate manner and may be, in the words of one personnel specialist, ‘no
more reliable than a Cosmopolitan-style questionnaire’ (cited in Sappal, 2005: 40). In
sum, rather like many of the other selection methods described above the proper use
of psychometric testing can help organizations make objective and more reliable
selection decisions as long as they are used in an appropriate manner and adminis-
tered properly.
Other methods which could be used by tourism and hospitality organizations
include things like presentations. For example, an applicant for a training manager’s
job is likely to be required to give numerous presentations and the organization may
want to assess their presentation skills. Organizations may also use various group
methods such as which often involve problem-solving. These activities may involve
some element of role playing. By undertaking such problem-solving in small groups
applicants will have the opportunity to demonstrate things like ability to work
within a group, creativity, interpersonal skills and so on. One final method is the so-
called in-tray exercise which will simulate an in-tray of a manager and the applicant
has to go through the tray and make decisions on the problems that they find.
Finally we come to the last method of selection, the assessment centre, which
ordinarily refers to a process rather than a physical centre. Assessment centres uti-
lize a mix of all of the above techniques and due to the opportunity to use a vari-
ety of methods – all of which are potentially assessing different aspects of the
candidates – they are often described as the ‘Rolls Royce’ of selection methods
(IRS, 2005). In this sense they are widely considered the most objective and best
predictive selection tool for future performance. Equally, though, we should also
recognize that assessment centres are also complex to design, time consuming and
costly meaning that they are often, though not exclusively, reserved for appointing
managerial- or graduate-level staff (and see HRM in practice 5.7).
In order for the overall process of recruitment and selection to be considered
successful it is important that it is considered fair by candidates, is cost effective, is
user friendly, acceptable to both the organization and the candidates, and is
reliable and valid. The reliability of a selection process refers to the extent to which
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a selection technique achieves consistency in what it is measuring over repeated
use. Validity can be seen in three different ways. First, face validity on refers to the
issue of whether the selection procedure was seen to be valid to candidate and
tester. Face validity can be particularly important in terms of organizations being
able to attract good candidates in the future. Second, predictive validity is con-
cerned with whether the outcome selection able to predict the ability to perform
effectively when in post. Lastly, content validity is about ensuring that the test or
exercise in assessing certain skills is actually relevant to the job in question.
Once the selection procedure is over there is also a need for organization to
ensure that there is feedback to both the successful and unsuccessful candidates.
Organizations should aim therefore to give feedback as soon as possible. It is also
important to recognize that for the feedback to be meaningful it should be specific
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 110
HRM in practice 5.7 The use of
assessment centres by easyJet
IDS (2002) notes that as a major airline easyJet is concerned to get it right in recruiting staff,
especially pilots, who are one of the company’s most expensive resources in terms of salary,
training and career development. The assessment centre for pilots was introduced in 1999
and has now been extended to the recruitment of cabin crew and call centre employees.
The assessment centre for pilots is particularly demanding, covering 2 days. Potential pilots
face a range of challenges which aim to assess aspects such as team-working, ability to
cope under pressure, ability to adhere to standards and technical knowledge. Additionally,
Captains who attend the assessment centre are also assessed against leadership and
decision-making criteria. Day 1 of the assessment centre is largely concerned with a range
of tests and activities such as group work, personality tests and interviews. If the applicants
successfully get through day 1 they progress to day 2. The second day is a flight simulation
exercise which assesses the candidate’s basic handling skills, as well as broader aspects such
as flight management and crew resource management skills.
Cabin crew undertake a 1 day assessment in which the company evaluates potential
employees against a number of competencies, including conscientiousness, sense of
urgency, initiative, empathy, self-confidence and enthusiasm. To assess these aspects can-
didates have an ice breaker and the ‘easyJet test’. The test measures things like mathemat-
ical ability, knowledge of easyJet and other factors relevant to the job, for example
knowledge of foreign currencies.
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as opposed to being too vague to allow candidates to fully appreciate why they
did not get the job. Abenefit from giving constructive feedback is that at the end of
the recruitment and selection process the organization is still maintaining a posi-
tive image. Rather like much of what we have previously discussed the provision
of feedback is an essential part of how organizations can portray themselves in a
positive manner throughout the recruitment and selection process.
Conclusion
Clearly tourism and hospitality organizations are faced with a mass of possible
methods and techniques in which to approach the question of recruitment and selec-
tion. As we described in the introduction there is no one best way to recruit and
select. Instead, organizations should be prepared to develop a contingent approach.
On the one hand this may simply mean employing people on the basis of word of
mouth or because they responded to an advert in the window of a restaurant, for
example. On the other hand it may be the culmination of a lengthy and expensive
selection process, particularly for managerial and graduate-level positions.
In answer to the question of whether there has been significant change in
recruitment and selection in the tourism and hospitality industry in recent years the
answer would be yes and no. Yes in terms of a shift to organizations looking for the
‘right’ people in terms of attitudes and behaviour and adoption of more sophisti-
cated techniques, such as psychometric testing. Equally, though, we could also
answer no in terms of the widespread use of traditional forms of recruitment and
selection, such as interviewing. Moreover evidence continues to suggest that the
recruitment and selection process in many tourism and hospitality organizations
often remains ad-hoc and informal, especially for operative and front-line positions.
References and further reading
Armstrong, M. (1999) A Handbook of Human Resource Management Practice, Kogan Page, 7th edition.
Baker, J. (1999) ‘Friday’s people’, Caterer and Hotelkeeper, 28 January, 30–31.
Beal, B. (2004) ‘Psychological search for Hilton hotel managers’, Human Resource Management
International Digest, 12(1), 30–32.
Chan, B. and Coleman, M. (2004) ‘Skills and competencies needed for the Hong Kong hotel industry: the
perspective of the hotel human resources manager’, Journal of Human Resources in Hospitality and
Tourism, 3(1), 3–18.
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Chartered Institute of Personnel and Development (2004) Recruitment, Retention and Turnover: A Survey
of the UK and Ireland, CIPD.
Chartered Institute of Personnel and Development (2006) The Guide To Recruitment Marketing, CIPD.
Gallier, E. (2004) ‘When the going gets tough’, Hospitality, June, 35.
Heery, E. and Noon, M. (2001) A Dictionary of Human Resource Management, Oxford University Press.
Hills, R. (2004) ‘Who would you most like to be stuck in a lift with?’, Sunday Herald, 23 May, 12.
Income Data Services (2002) Assessment Centres, IDS Studies No. 735, September.
Industrial Relations Services (2000) ‘The interview: its role in effective selection’, Employee Development
Bulletin, No. 122, February, 12–16.
Industrial Relations Services (2002) ‘Psychometrics: the next generation’, IRS Employment Review, No. 744,
28 January, 36–40.
Industrial Relations Services (2005) ‘Centre of attention’, IRS Employment Review, No. 816, 28 January,
42–48.
Industrial Relations Services (2006) ‘In the hiring line: boosting managers’ recruitment skills’, IRS
Employment Review, No. 846, 5 May, 42–48.
Jackson, M., Goldthorpe, J. and Mills, C. (2005) ‘Education, employers’ and class mobility’, Research in
Social Stratification and Mobility, 23, 1–30.
Jameson, S. (2000) ‘Recruitment and training in small firms’, Journal of European Industrial Training,
24(1), 43–49.
Kelliher, C. and Johnson, K. (1997) ‘Personnel management in hotels – an update: a move to human
resource management?’, Progress in Tourism and Hospitality Research, 3(4), 321–331.
Labour Research Department (2003) ‘Employers warned over bias in aptitude tests’, Labour Research,
December, 25.
Lockyer, C. and Scholarios, D. (2005) ‘Selecting hotel staff: why best practice does not always work’,
International Journal of Contemporary Hospitality Management, 16(2), 121–135.
Marchington, M. and Wilkinson, A. (2005) Human Resource Management at Work: People Management
and Development, CIPD, 3rd edition.
Nickson, D., Warhurst, C., Cullen, A.M. and Watt, A. (2003) ‘Bringing in the excluded? Aesthetic labour,
skills and training in the new economy’, Journal of Education and Work, 16(2), 185–203.
Nickson, D., Warhurst, C. and Dutton, E. (2005) ‘The importance of attitude and appearance in the service
encounter in retail and hospitality’, Managing Service Quality, 15(2), 195–208.
Nickson, D., Warhurst, C., Witz, A. and Cullen, A.M. (2001) ‘The importance of being aesthetic: work,
employment and service organization’, in A. Sturdy, I. Grugulis and H. Wilmott (eds.) Customer Service –
Empowerment and Entrapment, Palgrave, 170–190.
Price, L. (1994) ‘Poor personnel practice in the hotel and catering industry – does it matter?’, Human
Resource Management Journal, 4(4), 44–62.
Raub, S. and Streit, E. (2006) ‘Realistic recruitment: an empirical study of the cruise industry’, International
Journal of Contemporary Hospitality Management, 18(4), 278–289.
Sappal, S. (2005) ‘Top scorers’, People Management, 13 January, 38–40.
Smethurst, S. (2004) ‘The allure of online’, People Management, 29 July, 38–40.
Taylor, S. (1998) Employee Resourcing, IPM.
Torrington, D., Hall, L. and Taylor, S. (2005) Human Resource Management, Prentice Hall, 6th edition.
Warhurst, C. and Nickson, D. (2001) Looking Good, Sounding Right, Industrial Society.
Watson, T. (1994) ‘Recruitment and selection’, in K. Sisson (ed.) Personnel Management: A Comprehensive
Guide to Theory and Practice in Britain, Blackwell, 185–220.
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Websites
The Advisory, Conciliation and Arbitration Service (ACAS) has a useful publication on recruitment, which is
available at http://www.acas.org.uk/index.aspx? articleid?526&detailid?584
The Chartered Institute of Personnel and Development (CIPD) has a very informative factsheet on recruitment
which can be found at http://www.cipd.co.uk/subjects/recruitmen/general/recruitmt.htm?IsSrchRes?1
There are a variety of different links covering recruitment and selection at http://www.hrmguide.co.
uk/hrm/chap8/ch8-links.html
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Chapter 6
Equal opportunities
and managing diversity
Chapter objectives
This chapter reviews the nature of equal
opportunities and managing diversity in the
tourism and hospitality industry. The main
objectives of this chapter are to:
? Appreciate the differing aspects which drive
approaches to equality and diversity.
? Consider the employment experience of socially
defined minority groups.
? Discuss the role of legislation in attempting to
create greater equality.
? Recognize the importance of managing
diversity as a more business-oriented approach
to equality.
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EQUAL OPPORTUNI TI ES AND MANAGI NG DI VERSI TY 115
Introduction
Increasingly when we look at adverts for positions in tourism and hospitality organ-
izations we will see the statement that the employing organization is ‘an equal
opportunities employer’. Does this mean then that we are likely to find equality of
opportunities within organizations? Have we managed to get rid of discrimination?
Have we got a just society where sex, race/ethnicity, disability, age, religion and sexu-
ality are no more important than eye colour? Is there equality in relation to issues
such as recruitment and selection, training and development, remuneration, career
development and promotion? It is these and other questions which we will consider
in this chapter. Specifically we will recognize how certain social groups may experi-
ence disadvantage in the workplace, regardless of their qualities and abilities. The
manner in which organizations are seeking to address the issue of equal opportun-
ities may vary considerably and here it is helpful to recognize the useful distinction
offered by Goss (1994) with regard to the issue of equal opportunities. Goss makes a
distinction between what he terms a ‘short’-term compliance agenda, and a much
more proactive ‘long’-term agenda. The former agenda is driven largely by the idea
of complying with legislation to avoid penalties. For example, there is no upper limit
on compensation awarded by an employment tribunal in discrimination cases and
whether an employer unintentionally discriminates is no defence. Clearly, this type
of agenda is driven by organizational self-interest. In contrast, the long-term agenda
is premised on notions of efficient management of human resources, creating a good
organizational image, managing diversity and social justice, though some of these
aspects may, in reality, also be in the organization’s self-interest. In many respects
then we can think of equality and diversity in terms of:
? Legal aspects: failure to comply with legislation in this area can mean employers
facing unwelcome publicity and potentially large payouts as a result of employ-
ment tribunal decisions.
? Ethical aspects: it is ethically and morally right for organizations to seek to offer
equality of opportunity to all.
? Business aspects: it makes good business sense to encourage equality and diver-
sity to ensure the organization draws on the widest possible labour market to
make sure that they are maximizing the best use of all available resources.
Equality also makes good business sense in terms of potentially widening the
customer base and also portraying a positive company image.
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Of course, in reality, the approach to equality and diversity adopted by organiza-
tions may well be informed by all of these aspects. Increasingly though within a
more strategic HRM approach it is suggested that many organizations are recog-
nizing the business case for equality and diversity.
Stredwick (2005) suggests that support for the business case is strengthened
by recognizing three key issues. First, is the need to recognize demographic
changes. With a declining birth rate traditional sources of labour (young, white,
qualified and full-time) are in decline so organizations need to think about finding
alternative sources of labour. Second, the changing nature of the workplace and
specifically the shift from manufacturing to service employment means more and
more women are entering the labour market. Consequently organizations have to
respond to this change by ensuring they encourage the best applicants through
enhanced career opportunities and a supportive environment for all. Lastly, with the
shift to a service economy there is now a greater emphasis on customer relations,
especially in an ever more competitive environment. By pursuing active approaches
to equality and diversity management organizations not only offer opportunity to all
segments of the labour market, but may also broaden their customer base by demon-
strating such a commitment. That said, discrimination still remains a very real issue
within society generally and workplaces specifically, so the chapter will now move
on to consider steps which may be taken to eradicate discrimination in all its forms.
The employment experience of socially
defined minority groups
Agood starting point to further consider the issue of equal opportunities is to rec-
ognize some of the barriers that may effect the employment of certain groups of
workers, initially considering women, black and minority ethnic people, people
with disabilities and older people.
Women
Across the economy as a whole, women now make up 46 per cent of the workforce,
though nearly half of all women working work part-time (EOC, 2005). Despite
making up nearly half of the workforce women still remain under-represented in
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senior and middle management positions. For example, across the economy as a
whole although there is now greater representation of women in the boardroom
of Britain’s leading companies, women still remain ‘woefully under-represented’
according to Cranfield University’s annual survey of women in senior management
positions (Cranfield University, 2004). There is also continuing disparity in women’s
pay, relative to men, with women earning around 82p for every £1 earned by men
(EOC, 2005).
These disparities in the economy as a whole are also seen in the tourism and
hospitality industry. Although women account for 70 per cent of employees, there
are no female chief executives in the FTSE 350 travel, leisure and tourism companies
(Rossiter, 2005). Indeed, more generally across Europe travel and leisure has the low-
est level of boardroom representation with no representation at all compared to sec-
tors like household goods and services where 18.9 per cent of boards are made up by
women (EPWN, 2006). Moreover although the number of women managers in
tourism and hospitality is significantly higher than many other industries, it still
remains disproportionately low given the overall level of female representation
within the workforce (Mayling, 2003). Women may also face particular barriers in
the workplace in the tourism and hospitality industry, including (HCIMA, 1999):
? Lack of childcare provision.
? Difficulties of the dual role in maintaining a management career and caring for
children and other dependents.
? Lack of flexible, part-time opportunities at higher levels in the industry.
? The macho atmosphere in certain workplaces, such as the kitchen.
? Sexism and sexist attitudes.
? Poor career planning.
? Shortage of positive female role models.
There are a number of ways in which organizations can begin to address some of
these issues and HRM in practice 6.1 presents an example of a proactive response
to encouraging women’s employment.
Black and minority ethnic people
A recent report from the Cabinet Office (2003) noted that members of ethnic
minorities are more than twice as likely to be unemployed even when age, sex and
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level of qualifications are taken into account. Significantly the same report also notes
how this disparity in employment has changed little over the last 18 years. This lack
of economic activity is particularly pronounced in men from ethnic backgrounds aged
16–24 years. On the question of the progression of black and minority ethnic workers
to middle and senior management positions a recent report by the Runnymede Trust
(2000) found that only 1 per cent of senior managers and 3 per cent of junior managers
were from an ethnic minority, despite the fact that ethnic minorities make up 8 per
cent of the population as a whole. Similarly, a recent report from Cranfield University
found that just 2.3 per cent of board members in the largest companies listed on the
London Stock Exchange came from ethnic minority backgrounds (Smith, 2005). When
ethnic minority employees are employed it is noteworthy that they tend to be con-
centrated in terms of occupational segregation, with a large number employed in the
hospitality sub-sector in particular. For example, LRD (2005) notes that 52 per cent of
Bangladeshi workers work in the restaurant industry compared with only 1 per cent
of white males. In addition, LRD (2005) also notes a disparity in pay, with this ‘black
pay gap’ meaning in some instances that workers from some communities earn an
average of £7000 less than white workers.
As we have already noted the black and minority ethnic communities make
up around 8 per cent of the UK’s population and significantly will account for half
HRM in practice 6.1 Opportunity Now:
A proactive response to gender equality
Opportunity Now was originally set up as Opportunity 2000 in October 1991. Its aim was
to increase the quality and quantity of women’s participation in the workforce.
Membership is open to any organization, large or small and by June 2005 over 350 organ-
izations, including British Airways and Jurys Inn’s, had signed up. Those organizations join-
ing Opportunity Now commit themselves to overcoming the barriers to recruitment,
retention and development of women. Opportunity Now provides advice to employers
and shares information on best practice in areas such as developing flexible working
arrangements, improving childcare, career break options and training and education to
increase women’s opportunity at work. To further help organizations Opportunity Now
also runs a benchmarking exercise on gender equality, which helps employers to chart
progress whilst at the same time providing a checklist for organizational change.
Derived from IDS (2003); Opportunity Now (2005).
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the growth of the working age population in the decade 1999–2009 (LRD, 2005).
Consequently, there is a need for organizations to be proactive in their attempts to
promote racial equality. IDS (2001) suggest a number of practical steps which can
be taken by organizations, including:
? Ensuring fair recruitment practices, such as recruitment schemes targeted at
ethnic minority employees and targeted advertising to encourage more appli-
cants from under-represented groups.
? Using images of ethnic minority employees in publicity and advertising material.
? Developing links with ethnic minority communities (often as a way of attracting
new employees).
? Undertaking ethnic monitoring.
? Ensuring HR policies are in place to help foster and protect a diverse work envir-
onment (e.g. dignity at work and harassment policies).
? Accommodating different religious beliefs in the multicultural workforce.
? Introducing diversity awareness training (particularly for managers).
? Setting up internal networks for ethnic minority employees.
? Taking positive action on training and development.
There has also been a similar type of initiative for black minority ethnic employees
as Opportunity Now. Launched in October 1995, Race for Opportunity (RfO) is a
business-led initiative organized by Business in the Community and aims to put
race and diversity issues higher up the business agenda, by investing in the UK’s
ethnic communities. RfO publishes an annual benchmarking report which assesses
organizations in five key ‘impact’ areas, including leadership, community involve-
ment and supplier diversity (IDS, 2006).
Disabled employees
Often our perception is that disability is likely to mean that a person is in a wheel-
chair or visibly impaired. However, of the 8.7 million adults who are registered
disabled only 600,000 are in a wheelchair (Anon, 2004). Moreover 2.4 million are of
working age and over 70 per cent of this figure are economically active or looking
for work. In reality this means that a significant number of disabled people are
thought to want to work. It is also instructive to note that 70 per cent of disabled
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people who are economically active or looking for work became disabled while in
work (LRD, 2000). Thus there would seem a strong moral argument that employers
should aim to help disabled people back into the labour market. In a similar vein to
Opportunity Now and RfO there is also an attempt to be positive about disabled
workers with the ‘two-ticks’ scheme. Under this scheme any employers using the
two-ticks must (LRD, 2003):
? Interview all applicants with a disability that meets the minimum for a job
vacancy.
? Ask disabled employees at least once a year what can be done to ensure they
can develop and use their abilities at work.
? Make every effort when employees become disabled to ensure they stay in
employment.
? Take action to ensure that key employees are aware of the needs of disabled
people.
? Each year review achievements towards making the workplace welcoming and
accessible for disabled people, plan ways to improve and let all employees and
customers know about this progress and future plans.
Whilst the two-ticks campaign is important to changing workplaces practices,
campaigners for the disabled are also attempting to shift perceptions about
disability (and see HRM in practice 6.2).
HRM in practice 6.2 Perceptions of disability
A letter to People Management in 1997 from a representative of Capability Scotland noted
how language used to describe disability often shapes attitudes and perceptions. The
author of the letter notes how often people with disabilities are described as ‘suffering’
from the disability, which can lead to misconceptions such as the amount of time they are
likely to take off work. The letter also suggests preferred terminology to ensure that people
are aware of using pejorative terms like: the disabled, normal, mentally retarded and
confined to a wheelchair. The preferred terms are people with disabilities, able-bodied,
learning difficulties and wheelchair users.
Source: Bald (1997).
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Older workers
Hope (2005) reports that the National Audit Office estimated that cost of stereotyping
on the basis of age costs the UK economy £31 billion a year in lost contributions. For
older workers it can be especially difficult to gain a new job, especially once they are
over 45 years. Arkin (2005: 32) notes how some of the ‘ridiculous comments’ about
older workers have the ring of comments which were often made 30 years ago with
regard to sex and race discrimination. For example, he notes that prior to the intro-
duction of the Race Relations Act (RRA) in the 1970s some people argued that
employing someone from an ethnic minority in a shop would put customers off.
Certainly such attitudes have been prevalent in the tourism and hospitality industry,
with one well known restaurateur once famously suggesting that:
I fail to understand why employers ought not to be able to discriminate about
potential employees on the basis of age, at least for those who are in contact
with the public. We are in a business where image counts as much as content.
Of course, it is unfair to turn down older people with the required technical
skills to do the job, but so what? It is not a perfect world (Gottlieb, 1992: 20).
Work by Qu and Cheng (1996) who surveyed 26 hotels in Hong Kong and Magd
(2003) who interviewed 21 managing directors in small and medium sized hospi-
tality enterprises in the UK is useful to appreciate how older workers tend to be
perceived within tourism and hospitality. From a positive point of view the research
suggests that employers tend to see older workers as having: low absenteeism,
fewer accidents, low turnover rate, being motivated, hard working and diligent,
having a sense of responsibility, good communication skills and credibility with
customers. On the other hand, the research also revealed that older workers were
perceived as inflexible and reluctant to change, have low productivity, find it hard
to adapt to new technology and have difficulties in keeping up with the speed of
work. Whilst most age-related discrimination is directed towards older workers,
younger workers too can be affected. Smethurst (2004) reports research from the
Review and reflect
To what extent do you agree with Gottlieb’s sentiments and why?
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CIPD which notes that the optimum age in the workplace to be judged as neither
too old or too young is 35–40 years. For those under 35, 8 per cent of people had
reported being discriminated against for being too young.
The legislative response
The above discussion gives us a sense of some of the issues affecting certain
groups of employees. We can now move on to consider how these have been
addressed, beginning with the emergence of equal opportunities legislation. There
have been a number of laws introduced in the UK which have sought to address
the problems of discrimination generally and specifically to reduce such discrim-
ination in the labour market and the workplace.
Whilst legislation has now existed for over 30 years we should recognize that there
is much debate about whether the legislation has been successful, and whether it has
simply been embraced as rhetoric but without much success in implementation. For
example, many believe that legislation cannot by itself eradicate a whole range of
attitudes, which may encourage discriminating behaviour. On the other hand, whilst
recognizing that the law cannot change attitudes overnight, it can, and does, effect
change slowly. Some people would argue that it has in fact been too slow and its
effects have been patchy. In that sense the law requires an end to discrimination; it
does not actually require that employers do anything to promote equality. Related to
this point there is also the distinction made by many commentators about the differ-
ences between the letter and spirit of the law. The former encourages a narrow inter-
pretation of law, which may not be in the best interests of encouraging a more
proactive approach to equality and diversity. The latter is potentially more flexible in
offering the scope for decisions which encourage greater equality.
Having briefly contextualized the emergence of the legislative agenda we
can now go on and examine the actual provisions and what they mean for organ-
izations, starting with Table 6.1, which summarizes the range of anti-discriminatory
legislation.
Review and reflect
How successful is legislation likely to be in addressing equality issues?
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Table 6.1 Anti-discriminatory legislation
Act Areas covered
Sex Discrimination Act 1975 Sex and marital status (the latter referring
specifically to persons who are married)
Sex Discrimination (Gender Reassignment) Persons who intend to undertake a sex
Regulations 1999 change, are currently in the process of
doing so or have completed treatment
Employment Equality (Sex Discrimination) Introduced a new definition of indirect
Regulations 2005 discrimination and added specific
definitions covering discrimination on
grounds of harassment
Race Relations Act 1976 Race, colour nationality, national or ethnic
origin
Race Relations (Amendment) Act 2000 The duty of public authorities to take
positive action to promote good race
relations
Disability Discrimination Act 1995 Disabled persons
Disability Discrimination Act (Amendment) Removal of the exemption for employers of
Regulations 2003 fewer than 15 people; shift in the burden
of proof
Disability Discrimination Act 2005 Those with progressive conditions such as
HIV and cancer will be treated as disabled
from the point of diagnosis. Those with
mental illness are no longer required to
have their illness clinically recognized
Employment Equality (Sexual Orientation) Orientation towards persons of the same
Regulations 2003 sex, of the opposite sex, of both the same
sex and the opposite sex
Employment Equality (Religion or Belief) Religion or similar beliefs
Regulations 2003
Rehabilitation of Offenders Act 1974 Persons with ‘spent’ convictions
Human Rights Act 1998 Prohibition of forced labour and slavery;
right to respect for private and family life
(inter alia)
Derived from LRD (2006).
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The Sex Discrimination Act (SDA) and RRA are particularly important in
denoting the first systematic attempt to address discrimination. Both acts refer to
the idea of direct and indirect discrimination. Direct discrimination is where
employees of a particular sex, race or ethnic group are treated less favourably than
other employees. For example, a policy to only recruit men to management posts.
Indirect discrimination is where a particular requirement apparently treats every-
one equally but has a disproportionate effect on a particular group and the require-
ment cannot be shown to be justified. For example, requiring a kitchen porter to
speak fluent English, which is not a necessary requirement for the job. At present
there are three government sponsored bodies which are responsible for promoting
equality. With regard to sex and race the commissions are the Equal Opportunities
Commission (EOC) and the Commission for Racial Equality (CRE), which were
established in 1975 and 1976, respectively. The EOC and CRE are responsible for
working towards eliminating discrimination, promoting equality of opportunity
and reviewing how the law works. They also issues codes of practice, undertake
formal investigations where there are allegations of discrimination and can, in cer-
tain circumstances, support individual legal claims. With regard to disability, as of
April 2000 the Disability Rights Commission (DRC) has taken on the same role as
the CRE and the EOC (and see the later discussion of the DDA).
Both the SDA and RRA are concerned with prohibiting discrimination in all
areas of employment. For example, during the recruitment and selection process
organizations should unsure that the right message is conveyed in recruitment
advertisements, which as we noted in Chapter 5, should be carefully worded so
that there is no indication that people of some backgrounds are preferred to others.
Equally, in the selection procedure organizations should be wary of drawing up
person specifications that are unjustifiably demanding. As we noted there is also a
need to consider whether certain selection tests may discriminate against people
from minority backgrounds. Only the EOC or the CRE can instigate proceedings
in relation to advertising, but individuals can pursue claims via the employment
tribunal system in all other aspects of employment. The legislative threat centres
on possible adverse publicity to the organization as well as the direct and indirect
costs of tribunal claims or commission investigation. Although in reality a rela-
tively small number of cases actually end up being heard in an employment tribu-
nal. For example, ACAS (2006) notes that it received 9942 cases with regard to either
sex or race discrimination. Of these cases, 3283 were settled before the tribunal,
4267 were withdrawn, 1168 were either struck out by the tribunal or out of scope,
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leaving only 1224 cases ultimately reaching the tribunal to be heard. Nevertheless
cases which are concerned with discrimination do not carry an upper limit for com-
pensation, so organizations should aim to avoid such cases, which may prove to be
very costly.
Two other points are also important to note with regard to the SDAand RRA.
The first is positive action. Positive action may be confused with what is often
termed positive or reverse discrimination, or what in the US is known as affirma-
tive action. Positive discrimination seeks to redress previous inequality by giving
priority to certain groups in the labour market. For example, an organization
appointing a female candidate to a managerial position primarily because of her
gender, rather than her managerial skills. Currently such an approach is illegal in
the UK, but such approaches have been used in the US and other countries (and
see HRM in practice 6.3).
Whilst positive discrimination is unlawful in the UK, positive action is not. Positive
action may encompass a range of policy initiatives which aim to promote equality
Review and reflect
Outline arguments for and against positive discrimination.
HRM in practice 6.3 Jobs for the girls
Legislation was introduced in Norway in 2002 to ensure at least 40 per cent of boardroom
seats are reserved for women (Osborn, 2002). The decree initially affected state owned
firms, but by 2005 all public companies had to enforce the quota. Whilst equality groups
and trade unions were supportive of the move, employers feared that the initiative would
make Norway uncompetitive and discourage foreign firms from investing in the country
(Walsh, 2004). Indeed, Scandinavian countries generally are trail blazers in increasing the
representation of women on boards. By 2006 Norway had the highest percentage of
women at boardroom level at 28 per cent. Sweden had 22 per cent, Finland 20 per cent and
Denmark 17.9 per cent (EPWN, 2006). These figures can be compared to other selected
European countries such as the UK which had 11.4 per cent, Germany 7.2 per cent, Italy
1.9 per cent and Portugal where there are no women at boardroom level (EPWN, 2006).
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of opportunity through the provision of facilities, procedures or actions that
redress disadvantage suffered by particular groups in the labour market or organ-
ization. For example, under positive action both the SDAand RRAmake it lawful
to encourage and provide training for members of one sex or racial group who
have been under-represented in particular work in the previous 12 months. In
addition advertisements can explicitly encourage applications from one sex or
racial group if that group is under-represented within the organization, though
there are no guarantees that they will get the job.
One final point when we are talking about sex or race discrimination is that of
genuine occupational grounds, where discrimination is permitted due to sex or
race being specified as a Genuine Occupational Qualification (GOQ), which are out-
lined in sections 7(2) of the SDAand 5(2) of the RRA. AGOQ is likely to be based
on things such as authenticity, decency, privacy and the delivery of personal wel-
fare services. For example, a stylish Italian bistro may seek to retain its authenticity
by employing only Italian staff. As we noted above the SDAand RRAare particu-
larly important in being the first attempt to establish a legislative framework and
also with regard to establishing many of the mechanisms which are now being
incorporated in more recent legislative intervention, such as the DDA.
The DDA is similar to the SDA and RRA, though it offers protection only
against direct discrimination. The DDAoffers a broad definition of disability, with
section 1 of the DDA talking of any, ‘Physical or mental impairment which has a
substantial and long-term adverse effect on his (or her) ability to carry out normal
day-to-day activities’. Indeed, LRD (1999) in reviewing a number of employment
tribunal decisions note that there is no definitive list of what amounts to psychical
or mental impairment and employment tribunals are left to decide what may be
considered a disability (and see HRM in practice 6.4).
The DDAinitially made it unlawful for any company which had more than 15
employees to discriminate against employees, job applicants and contractors who
are disabled. Recent changes though now mean that the provisions of the DDAnow
extend to all employers, regardless of size. Within tourism and hospitality there are
many instances where managers may have to consider their response to potentially
sensitive situations under the aegis of the DDA(and see HRM in practice 6.5).
To a large extent the approach to the scenarios outlined in HRM in practice 6.5
will be dictated by the notion of ‘reasonable adjustments’. As we noted above
although the DDA provides protection against direct discrimination with regard
to indirect discrimination employers may set a requirement for use in recruitment
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HRM in practice 6.4 Conditions amounting
to physical or mental impairment
Employment tribunals have taken a wide view of disability and have ruled that all the
conditions below may amount to a physical or mental impairment.
Asthma Bipolar affective disorder
Migraines Cerebral palsy
Photosensitive epilepsy Chronic fatigue syndrome
Visual impairment Colitis
Injuries affecting mobility Congenital myotonic dystrophy
Abdominal pain Deafness
Depression Emphysema
Multiple sclerosis Diabetes
Post-traumatic stress disorder
Whilst these conditions have all been accepted as a disability in tribunal decisions they
should still not be considered as a wholly definitive list. Other tribunals may not consider
them as a disability due to differing circumstances with the individual bringing the case.
More recently under the aegis of the DDA, HIV/AIDS, as well as mental illness and progres-
sive conditions such as cancer have all been formally designated as being part of the act.
Employees will be deemed disabled as soon as these latter conditions are diagnosed.
Derived from LRD (1999); LRD (2006).
HRM in practice 6.5 An appropriate
response to disability?
As a manager think about how you might respond to the following scenarios.
An applicant for a waiting job, who otherwise impresses in the interview, is visually
impaired. There may be some concerns about them tripping over furniture, reading
blackboard menus to customers or dropping plates on laps and so on.
An applicant for a front line position in a travel agency is facially disfigured and you
are concerned about whether their appearance may put off customers.
An applicant for a position as chef who is wheelchair bound.
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or promotion processes which might be held to discriminate against people with
disabilities. In such cases less favourable treatment can only be justified where it is
relevant to the circumstances of the individual case and where the reason for the
treatment is felt to be substantial. This is where the notion of reasonable adjust-
ments becomes important. Employers have to consider whether the less favourable
treatment can be overcome by reasonable adjustments to premises or the employ-
ment arrangements. For example, IRS (2003) notes some of the common adjust-
ments made by employers in response to the DDA, including:
? Allowing absence for rehabilitation and treatment.
? Altering a person’s working hours.
? Acquiring or modifying equipment.
? Adjusting premises.
? Transferring a person to another job.
? Assigning a person to other work.
? Providing a reader and interpreter.
? Providing support workers.
? Modifying instruction manuals.
With regard to the scenarios above, in the case of the chef health and safety con-
siderations would mean that the use of a wheelchair within the kitchen would be
impractical and it would be considered unreasonable to make significant adjust-
ments to the premises. On the other hand, visual impairment is likely to require a
much more proactive response from tourism and hospitality employers (and see
HRM in practice 6.6).
Afurther facet of the DDAwhich is particularly apposite for tourism and hos-
pitality organizations is the need to ensure that employees are aware of the needs of
disabled customers. For example, organizations may develop disability awareness
training in-house or use commercially available options such as IndividuALL’s self-
learning CD-Rom, Welcoming Disabled Guests. IndividuaALLis part of Tourism for
All UK, a national registered charity which aims to provide advice and support to
disabled people and tourism providers to enhance the accessibility of tourism pro-
vision to the disabled.
As can be seen in Table 6.1 it is only recently that discrimination based on sexual
orientation and religion have become explicitly prohibited. There are approximately
1.3 to 1.9 gay and lesbian workers in the UK (LRD, 2003a) and the perception is
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that there is a higher proportion of gay and lesbian employees within hospitality
and tourism. That said, there has been little research that has explicitly addressed
the opportunities and experiences of gay men and lesbians within tourism and
hospitality organizations. More generally, research has pointed to the discrimin-
ation faced by gay and lesbian employees. For example, LRD (2000a) reports a sur-
vey by the TUC which found that 44 per cent of gay or lesbian employees had
suffered some form of discriminatory treatment, most commonly name calling
and homophobic abuse, but in some cases dismissal. Even with the introduction of
legislation in 2003 there still seems to be evidence of continuing discrimination.
For example, recent research suggests that nearly half of gay men and lesbian
women still fear discrimination if they ‘come out’ at work ( Johnston, 2006). As
with much of the other areas of legislation discussed in this chapter the key is for
organizations to think about developing appropriate policies and procedures to
ensure compliance with the legislation. With regard to sexual orientation Ward
(2003) notes how research has highlighted the positive effects on motivation and
job satisfaction for lesbian and gay employees who feel able to ‘come out’ in the
workplace. To help gay and lesbian employees to ‘come out’ the same author
outlines a series of appropriate policy responses.
HRM in practice 6.6 Responding to the needs
of visually impaired employees
Wendy Kerner is visually impaired being completely blind in one eye and having little
vision in the other. She works as a purchase ledger clerk at the 37-bedroom Lauriston
Hotel in Weston-super-Mare. Her main responsibilities are inputting petty cash, cheques
and invoices into the hotel account’s system and doing the weekly cheque run for the
hotel’s suppliers. Additionally, she also maintains the database of suppliers details and
occasionally helps out in reception if the hotel is busy. In order to support her at work the
hotel secured funding from the Government’s Access to Work programme to purchase a
range of equipment. The equipment included technology to enable her to print her work
in Braille and software that enlarges print and speak while Kerner types. Working prac-
tices at reception were also altered slightly to move from a handwritten list of petty cash
transactions to printing a Braille version which Kerner can read.
Source: Guild (2002).
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? Understand the effects of the closet – being gay and lesbian and not feeling that
the workplace is sufficiently supportive to allow them to come out will often
have a negative impact on the individual and their standard of work.
? Recognize the benefits of ‘coming out’ – many gay and lesbian employees
describe coming out as the most significant event of their working life, often
leading to increased job satisfaction, motivation and enhanced commitment to
the organization.
? Know your own people – action may be needed to ensure that the organization
is one where staff feel safe to come out. This may require the organization to
explore their employees’ attitudes to sexual orientation to determine the appro-
priate policy responses.
? Raise awareness – as with other forms of discrimination, discriminatory behav-
iour can often be unwitting. There may be a need to raise awareness of the
issues surrounding sexual orientation through things like discussion groups.
? Support a lesbian and gay network – ‘invisibility’ at work is often an issue for
lesbians and gay men and an employee network can be useful to provide sup-
port and also raise the profile of sexual minorities with colleagues.
? Ensure support from top management – it is important to have a senior man-
ager, who is not necessarily gay themselves, to act as a diversity champion for
sexual minorities in the workplace.
? Create a culture where people can come out – much of the above suggests
means by which this can be done. There is also a need to train managers to make
the right decisions in support of such a culture.
Cooper (2003) reports evidence from 20 organizations in terms of their response to
the new regulations on religious discrimination. Only seven of the organizations
were conducting a thorough review of policies and making changes to practices,
whilst the remaining 13 organizations were simply adding the word ‘religion’ to
their discrimination policies. The same author cites several legal experts who sug-
gest that there is a need for organizations to be proactive in their interpretation of
the legislation. One legal expert is quoted in Cooper as suggesting that, ‘religion is
key to way some people identify themselves – it’s more important than ethnicity
or nationality – and they rightly expect companies to accommodate their religious
needs and protect them from discrimination’ (p. 27). Advice from the Department
of Trade of Industry and Advisory Conciliation and Arbitration Service points to a
number of areas that organizations should be considering with regard to religious
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discrimination. For example, they caution against word of mouth recruitment and
also suggest employers should examine areas such as the provision of prayer room
facilities and the possibility of flexible work to accommodate religious holidays
(and see HRM in practice 6.7).
Afurther piece of legislation which is set to have a significant impact on human
resource policies is that concerned with age. On its election in 1997 the Labour
Government promised legislation to prohibit age discrimination, a situation that
already existed in a number of other countries including large parts of Europe and
the US. However, the Government eventually opted for a non-statutory code of con-
duct called Age Diversity in Employment. As a voluntary code, however, the code of
conduct lacked teeth. Consequently, when in 2000 the UK decided to support the
EU directive on equal treatment, the Government pledged to introduce legislation
outlawing age discrimination by October 2006.
In common with the other areas covered by legislation the new legislation on
age will aim to ensure that workers are not discriminated against in areas such as
recruitment and selection, promotion and the provision of training. IRS (2004) note
the unpreparedness of many employers for the age discrimination legislation not-
ing, amongst other things, that one in three employers are unaware that the legis-
lation will take effect in the near future. Indeed, in a more recent overview of the new
legislation IRS (2006a, b, c) recognize that experience in other countries suggests that
the introduction of the legislation is likely to see a significant number of claims for
age discrimination. If organizations wish to avoid such a situation they should aim
to develop a more proactive approach to the introduction of the legislation. For
HRM in practice 6.7 British Airways responding
to the legislation on religious discrimination
RfO (2004) reports how, in response to the new regulations prohibiting discrimination on
religious grounds, British Airways consulted with their employees via a series of focus
groups and meetings. The intent of the meetings was to ensure that the needs of differ-
ent groups of employees were managed to conform to the legislation. In discussing the
issues with employees some of the key issues raised were: availability of prayer rooms,
uniform and dress code regulations, labelling of food and time off for praying and reli-
gious festivals. Consideration of these topics was then used to develop a frequently
asked question section on the British Airways staff website.
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example they could become an Age Positive Employer Champion. Such employers
are committed to tackling age discrimination in their own workplace and taking
practical steps to change their employment practices. In addition, further steps to
achieving an age-diverse workforce include (IRS, 2004: 48):
? Reviewing the employment cycle from recruitment to retirement in order to
eradicate any age bias, encompassing areas such as recruitment advertising.
? Clearly communicate with suppliers expectations about creating an age-diverse
workforce.
? Use the Age Positive logo on recruitment adverts.
? Remove any reference to date of birth from all application forms.
? Proactively appeal to older workers through recruitment advertising.
? Champion age diversity at a senior level within the business.
? Use external and internal PR to share good practice – feature employees as age-
positive role modes.
? Adopt a flexible approach to recruitment.
Lastly, there is the Rehabilitation of Offenders Act 1974. The CIPD (2006) suggests
that one fifth of the working population has a criminal record, with Drury (2001)
recognizing that for men under 35 the figure is one in three. Although some
employers may be wary of employing somebody with a criminal record it is import-
ant to recognize that the Act enables offenders who received less than a custodial
sentence of up to two and a half years to be rehabilitated, and their convictions to
be ‘spent’. This means that after a certain amount of time potential employees are
able to answer no to the question of whether they have got a criminal record or not.
The length of time is dependent on the sentence received. It is important to recog-
nize that it is illegal for an employer to discriminate on the basis of a spent convic-
tion. Gledhill (2002) suggests that the hospitality industry, in particular, should
look seriously to employing ex-offenders to address labour shortages and recruit-
ment problems. He reports a Prison Service chef training scheme which aims to
train inmates to National Vocational Qualification (NVQ) level 2 in food hygiene
and food handling. Prisoners on the scheme cook for fellow inmates so get used to
the pressure of working to deadlines and a number of ex-offenders were successful
in gaining jobs on release.
One final point to note before the chapter moves on to consider managing
diversity is the issue of a single equalities body. As we have previously recognized
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the EOC, CRE and DRC are responsible for the broad areas of sex, race/ethnicity
and disability. Currently there are no bodies that are responsible for sexual orien-
tation and religion. In response to this situation, and the emergence of age legisla-
tion in October 2006, the UK Government has now established a single equalities
body. This new body will be known as The Commission for Equality and Human
Rights (CEHR) and came into being with The Equality Act 2006. In October 2007
CEHR will merge the functions of the EOC and DRC, as well as taking responsi-
bility for sexual orientation, religion and age. Surprisingly, the CRE will not imme-
diately become part of the new organization, but at the time of writing it is envisaged
that it will join by 2009.
Managing diversity
In reviewing the debate about equal opportunities, what we have been largely
talking about to date is the meeting of statutory requirements to offer equal oppor-
tunities to all in the organization, or those who will potentially join the organiza-
tion. In many respects this can be considered the short-term agenda as outlined by
Goss (1994), where the emphasis is on meeting legal obligations to ensure separate
groups are not discriminated against in the workplace. Alonger-term agenda that
aims to move away from such a narrow approach is suggested by the notion of
managing diversity.
Managing diversity is also particularly important given that it would be remiss
to imagine women or ethnic minorities or people with disabilities as a homogen-
ous group. For example, women are divided by class, ethnicity, age and occupa-
tional status. Similarly, ethnic minorities are far from homogenous, for example
there may be major differences in the opportunities and employment experience
between Asian employees and black African employees. In that sense resistance to
equal opportunities policies may not come simply from white, non-disadvantaged
men. Opposition to equal opportunities may also be seen from particular groups
in society due to the fear of backlash, or being seen to have achieved a position
based on grounds other than merit. Of course, the legislative agenda does not neces-
sarily seek to create such perceptions or stereotypes, for example it does not sup-
port positive discrimination. Nevertheless, the perception that equal opportunities
is primarily driven by a defensive legislative agenda has led to the emergence of
managing diversity as a potentially more strategic and business-oriented approach
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to engendering equality of opportunity. To consider this point we should consider
three questions in relation to managing diversity, these being:
1 What is managing diversity?
2 How are equal opportunities moved on by managing diversity?
3 What action does managing diversity require?
In answer to the first question, Ellis and Sonnenfield (1994: 82) define managing
diversity as, ‘the challenge of meeting the needs of a culturally diverse workforce
and of sensitizing workers and managers to differences associated with gender,
race, age and nationality in an attempt to maximize the potential productivity of
all employees’. In a similar vein, Kandola and Fullerton (1998: 8) suggest that:
The basic concept of managing diversity accepts that the workforce consists
of a diverse population of people. The diversity consists of visible and non-
visible differences which include factors, such as sex, age, background, race,
disability, personality and workstyle. It is founded on the premise that har-
nessing these differences will create a productive environment in which
everybody feels valued, where their talents are being fully utilized and in
which organizational goals are met.
With regard to the second question, Table 6.2 illustrates the manner in which the
managing diversity and equal opportunities are suggested as being different.
So the question we can ask ourselves is to what extent are organizations moving
to become diverse and multicultural and if not how can organizations address this
issue. At one level many would argue that the tourism and hospitality industry is, in
all respects, be it unit, locality, clientele or labour market, possibly the most inter-
national of industries. Baum (1996: A77), for example, notes how:
Tourism … is almost unique in providing multicultural interface at a variety
of levels and in many situations, simultaneously. It is an everyday experience
for a Japanese visitor to London to be checked into a hotel by an Australian
receptionist, supervised by an English front office manager of Afro-Caribbean
origin, in a hotel owned by Middle Eastern financial interests, managed by
an American hotel multinational who have appointed an Italian as general
manager to the property.
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However, whilst Baum’s quote is useful in pointing to the multicultural nature of
tourism and hospitality we should also recognize that multiculturalism of this
nature does not axiomatically equate to genuine opportunity for all in tourism and
hospitality organizations. For example, research that has been conducted in the
US points to some limited success in diversity programmes. Wilborn and Weaver
(2002) investigated diversity management training initiatives (DMTIs) by survey-
ing 139 managers in a range of lodging properties. The managers were questioned
about a variety of DMTIs including aspects such as diversity awareness training
for managers, cross race/gender training teams, networking groups and minority
internships. Nearly half the managers surveyed felt that their organization offered
a good diversity management training programme. Significantly, managers who
were exposed to DMTIs had more positive feelings towards such initiatives in
terms of recognizing their importance towards organizational success. In a similar
vein, Speizer (2004) notes the success of Denny’s restaurant chain from being seen
as one of the most racist companies in America to being number one on Fortune
Table 6.2 Differences between managing diversity and equal opportunities
Managing diversity Equal opportunities
? Ensures all employees maximize their ? Concentration on issues of discrimination
potential and their contribution to the
organization
? Embraces a broad range of people; no ? Perceived as an issue for certain groups in
one is excluded the labour market such as women, ethnic
minorities and people with disabilities
? Concentration on issues of movement ? Less of an emphasis on culture change
within an organization, the culture of and the meeting of business objectives,
the organization, and meeting business premised more on moral and ethical
objectives issues
? Is the concern of all employees, ? Seen as an issue to do with human
especially managers resource practitioners
? Does not rely on positive action/ ? Relies on positive action
affirmative action
Source: This material is taken from Diversity in Action: Managing the Mosaic by Kandola, R. and Fullerton, J.,
2nd edition (1998), with the permission of the publisher, the Chartered Institute of Personnel and
Development, London.
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magazine’s list of 50 best companies in America for minorities. To address the prob-
lem of racism, Speizer reports how Denny’s appointed the first diversity officer to
report directly to the CEO. With a budget of over $1 million dollars a year the diver-
sity officer was able to develop a series of initiatives. For example, they hired over
100 diversity trainers and insisted that all employees – from senior executives to
dishwashers – attend diversity awareness classes. Denny’s also sought to encour-
age more customers from ethnic minority groups and also diversified their suppli-
ers going from having no minority suppliers or contractors to spending over $616
million with minority suppliers between 1995–2000. On the other hand research
undertaken by Groeschl and Doherty (1999) on a number of hotels in San Francisco
points to a much more reactive approach, what they term a ‘reactive diversification
strategy’. Such an approach is largely concerned with complying with legislation in
areas like affirmative action and training in equal opportunities areas such as the
American Disability Act. As they note though, ‘the hotels have not been able, so far,
to make the next step from tolerating diversity to valuing it’ (p. 266).
Clearly, then, managing diversity is something that organizations have to think
about in a proactive manner. There are no easy prescriptions as to how this approach
can be achieved, though Kandola and Fullerton (1998) offer what they consider to be
an integrated and coherent model of the diversity-oriented organization. They also
suggest this model can be used as a benchmark to drive organizational initiatives
and strategy. The idea of such an organization is underpinned by the notion of the
creation of a mosaic to encourage diversity in organizations:
Missions and values
Objectives and fair processes
Skilled workforce: aware and fair
Active flexibility
Individual focus
Culture that empowers
These aspects are now briefly discussed.
Diversity-oriented organizations will seek to develop a strong and positive
mission and core values statement, which recognizes that managing diversity is an
important long-term business objective for the organization. In support of the mis-
sion and vision all processes and systems in organizations (e.g. recruitment, selec-
tion, performance appraisals, promotion decisions and so on) need to be audited
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EQUAL OPPORTUNI TI ES AND MANAGI NG DI VERSI TY 137
and re-audited to ensure that no one group predominates. With regard to the
skilled workforce Kandola and Fullerton note the importance of ensuring that the
entire workforce is aware of and guided by the principles of managing diversity.
By understanding why diversity is important employees can act in a manner
which ensures their biases and prejudices do not influence the way they make
decisions and work with colleagues. Such an approach may also require a pro-
active approach to equipping managers in particular with the right kind of skills
to ensure managing diversity is supported by the requisite managerial capability.
Active flexibility is important in ensuring that working patterns, policies, practices
and procedures support the approach to diversity. For example, in recognizing the
diverse needs of all employees Kandola and Fullerton note the importance of
adopting a ‘cafeteria’ approach to issue surrounding work/life needs. In advocating
an individual focus Kandola and Fullerton note how sometimes ‘special events’
that focus on a particular group can actually serve to reinforce stereotypes or
increase hostility to particular groups. Resultantly, things such as cross-cultural
training programmes should aim to foster respect for employees as individual
actors, rather than treating employees as member of a particular group, with eas-
ily categories differences. Finally, underpinning much of the above is the need to
sustain the right kind of organizational culture. We have already noted the import-
ance of organizational culture in Chapter 2 and in terms of managing diversity
there is a need to ensure the prevailing culture encourages participation and cre-
ativity from all organizational members.
Conclusion
At the outset of the chapter we asked whether we are likely to find equality of
opportunities within organizations. The simple answer would be no. There was
evidence within the chapter to suggest that certain groups in society still continue
to face discrimination which has a deleterious effect on their employment experi-
ence. That said, the chapter also recognized the manner in which legislation aims
to eradicate such discrimination and how managing diversity seeks to encourage
organizations to adopt a more proactive response to ensuring opportunity for all.
Although equal opportunities and managing diversity may be represented as being
dichotomous in their approach, in reality many organizations will adopt an
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 138
approach which has elements of both. Many would recognize that valuing and
promoting diversity in the workforce probably relies on a delicate balance between
legal requirements and a business-driven desire to be an employer of choice and to
attract and retain the best employees, regardless of their backgrounds.
References and further reading
Advisory, Conciliation and Arbitration Service (2006) Annual Report and Accounts 2005/06, ACAS.
Anon (2004) ‘Countdown to DDA day’, Caterer and Hotelkeeper, 22 July, 34–36.
Arkin, A. (2005) ‘Chip off the old block’, People Management, 21 April, 32–34.
Bald, S. (1997) ‘No excuse for patronising language’, People Management, 3 April, 19.
Baum, T. (1996) Managing Cultural Diversity in Tourism, British Tourist Authority/English Tourist Board,
Insights, A77–A84.
Cabinet Office (2003) Ethnic Minorities and the Labour Market, Cabinet Office.
Chartered Institute of Personnel and Development (2006) Employing People with Criminal Records
Factsheet, CIPD.
Cooper, C. (2003) ‘Minority support’, People Management, 4 December, 24–27.
Department of Trade and Industry (2001) Creating a Work-Life Balance: A Good Practice Guide for the
Hospitality Industry, DTI.
Drury, B. (2001) ‘How to assess criminal convictions’, People Management, 22 March, 52–53.
Ellis, C. and Sonnenfield, J. (1994) ‘Diverse approaches to managing diversity’, Human Resource
Management, 33(1), 79–109.
Equality Opportunities Commission (2005) Facts About Women and Men in Great Britain, EOC.
European Professional Women’s Network (EPWN) (2006) Second Bi-annual EuropeanPWN BoardWomen
Monitor 2006, press release at http://www.europeanpwn.net/pdf/boardwomen_press_release120606.pdf
(accessed 15 July 2006).
Gledhill, B. (2002) ‘Releasing potential’, Caterer and Hotelkeeper, 10 October, 32–34.
Goss, D. (1994) Principles of Human Resource Management, Routledge.
Gottleib, M. (1992) Letter to the editor in Caterer and Hotelkeeper, 25 June 1992, 20.
Groeschl, S. and Doherty, L. (1999) ‘Diversity management in practice’, International Journal of Contemporary
Hospitality Management, 11(6), 262–268.
Guild, S. (2002) ‘Willing and able’, Caterer and Hotelkeeper, 17 January, 29–29.
Hope, K. (2005) ‘Holding back the years’, People Management, 21 April, 24–30.
Hotel and Catering International Management Association (1999) Managing Diversity: Women at Work,
Management Brief No. 3, HCIMA.
Income Data Services (2001) Promoting Racial Equality, IDS Studies No. 719, September.
Income Data Services (2003) Opportunity Now, IDS Studies No. 758, September.
Income Data Services (2006) Promoting Race Equality, IDS HR Studies, No. 825, July.
Industrial Relations Services (2003) ‘Managing disability 2003: a progress report’, IRS Employment Review,
No. 785, 3 October, 11–17.
Industrial Relations Services (2004) ‘Using age diversity policies to attract and retain older workers’, IRS
Employment Review, No. 808, 24 September, 42–48.
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EQUAL OPPORTUNI TI ES AND MANAGI NG DI VERSI TY 139
Industrial Relations Services (2006a) ‘Age discrimination (1)’, IRS Employment Review, No. 847, 19 May,
53–58.
Industrial Relations Services (2006b) ‘Age discrimination (2)’, IRS Employment Review, No. 848, 2 June,
51–57.
Industrial Relations Services (2006c) ‘Age discrimination (3)’, IRS Employment Review, No. 849,
23 June, 51–58.
Johnston, J. (2006) ‘Half of gays believe they’ll be discriminated against if they “come out” at work’,
Sunday Herald, 22 January, 14.
Kandola R. and Fullerton, J. (1998) Diversity in Action: Managing the Mosaic, CIPD, 2nd edition.
Labour Research Department (1999) ‘How do tribunals define disability?’, Labour Research, January, 32.
Labour Research Department (2000) Tackling Disability Discrimination, LRD.
Labour Research Department (2000a) ‘UK soft on homophobia’, Labour Research, July, 10–12.
Labour Research Department (2003) ‘Making workplaces disability friendly’, Labour Research, December,
15–16.
Labour Research Department (2003a) ‘Two cheers for gay-bias rules’, Labour Research, July, 11–13.
Labour Research Department (2005) Black and Minority Ethnic Workers: Tackling Discrimination, LRD.
Labour Research Department (2006) Law at Work, LRD.
Magd, H. (2003) ‘Management attitudes and perceptions of older employees in hospitality management’,
International Journal of Contemporary Hospitality Management, 15, 7, 393–401.
Mayling, S. (2003) ‘Can positive discrimination help women?’, Travel Trade Gazette, 21 April, 8–9.
Opportunity Now (2005) Review 05:06: All About Opportunity Now and Its Future Plans, Opportunity Now.
Osborn, A. (2002) ‘Norway sets 40% female quota for boardrooms’, The Guardian, August 1, 13.
Qu, H. and Cheng, S. Y. (1996) ‘Attitudes towards utilizing older workers in the Hong Kong hotel industry’,
International Journal of Hospitality Management, 15(3), 245–254.
Race for Opportunity (2004) RFO Newsletter, Summer, 16.
Rossiter, P. (2005) ‘Women in Business’, Leisure Opportunities, 23 March, 7.
Runnymede Trust (2000) Moving on Up? Racial Equality and the Corporate Agenda: A Study of the FTSE
100 Companies, Central Books.
Smethurst, S. (2004) ‘Ageism rife in UK workplace’, People Management, 15 January, 10.
Smith, L. (2005) ‘Too few black and Asian faces at the top’, Guardian, 17 November, 29.
Speizer, I. (2004) ‘Diversity on the menu’, Workforce Management, November, 41–45.
Stredwick, J. (2005) An Introduction to Human Resource Management, Elsevier, 2nd edition.
Walsh, C. (2004) ‘A woman’s place is on the board’, Observer Business, 2 May, 5.
Ward, J. (2003) ‘How to address sexual orientation’, People Management, 23 October, 62–63.
Wilborn, L. and Weaver, P. (2002) ‘Diversity management training initiatives: a profile of current practices
within the lodging industry’, Journal of Human Resources in Hospitality and Tourism, 1(4), 79–96.
Websites
The various equality commissions can be found at:
Commission for Racial Equality http://www.cre.gov.uk/
Disability Rights Commission http://www.drc.org.uk
Ch06-H6572.qxd 11/22/06 5:51 PM Page 139
Equal Opportunities Commission http://www.eoc.org.uk/
Although it does not come into official existence until October 2007 the CEHR already has a website,
http://www.cehr.org.uk/
Stonewall is an organization that supports gay people’s right to equality http:// www.stonewall.org.uk/
workplace
The Employers Forum on Age can be found at http://www.efa.org.uk
The Apex Trust is a voluntary organization that helps ex-offenders get back into employment http://www.
apextrust.com/apextrust/exo_rehabact.shtm
For information on the various world religions see http://www.bbc.co.uk/religion/religions/index.shtml
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Chapter 7
Training and
development
Chapter objectives
This chapter considers the key role of training and
development in tourism and hospitality
organizations. The chapter aims to:
? Distinguish the different levels of analysis to
understand approaches to training and
development.
? Appreciate the importance of government-level
policy in establishing the context in which
tourism and hospitality organizations develop
their training policies.
? Recognize debates surrounding terms such as
education, training and development.
? Consider the range of training methods
available to tourism and hospitality
organizations.
141
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 142
Introduction
It is increasingly recognized that human resource development (HRD) is crucial in
ensuring effectiveness, quality and responsiveness in organizations to an ever
changing and complex environment. Resultantly, training and development activ-
ities now seek to emphasize adaptability, flexibility and continuous development
to ensure that organizations can survive and compete in an ever more competitive
environment. However, the importance of training and development is not just
apparent for organizations. As we increasingly are entreated to engage in lifelong
learning, then training and development becomes important for individuals.
Moreover, there is now also recognition of the importance of national competitive-
ness, especially in an ever more globalized world. Training and development,
therefore, becomes important from an individual, organizational and national per-
spective. Therefore we see more and more talk of the importance of HRD which is
likely to encompass notions of education, learning, training and development and
the interchangeability or otherwise of these distinctions will also be something
considered in this chapter. Before we begin to consider these issues in detail
though it is useful to delineate different levels of analysis in understanding train-
ing and Table 7.1 outlines the ways in which we can think of training.
Throughout this chapter we will consider various aspects of these levels and
begin initially by considering the importance of how national government policy
impacts on training and development.
Understanding the context: national level
responses to training
It is often argued that a nation’s competitive advantage depends on the skills and
inventiveness of its people. Often the manner in which organizations seek to
respond to this issue will be determined to a large extent by the views of the gov-
ernment. Increasingly in the UK in the 1980s and 1990s there was an emerging con-
sensus from government, policy makers and practitioners that training should be
encouraged within organizations for the greater good of the economy. Despite the
seeming acceptance by government and employers of the importance of training
and the need to encourage it, there is a good deal of debate as to whether, in reality,
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TRAI NI NG AND DEVELOPMENT 143
Table 7.1 Levels of analysis for understanding approaches to training and development
Level Main organizations involved/activities undertaken
National/Governmental level ? Government policy, for example the UK Government
seeking a more proactive approach to encourage training
in organizations
? Training initiatives, for example in the UK Investors in
People (IiP) and Apprenticeships
Industry level ? National Training Organizations (NTOs), for example
People 1st the Sector Skills Council (SSC) for hospitality,
leisure, travel and tourism
? Industry level initiatives, for example Excellence Through
People and Welcome Host
Company level ? Creation of an overall view of company’s approach to
training, for example seeking IiP accreditation, being
involved in Welcome Host and Excellence Through
People
? Ensuring ‘fit’ between what the company wants to
achieve and how units can operationalize this
Unit level ? Ensuring on- and off-the-job training takes place
? Monitoring individuals training and development plans
? Performance development and monitoring, for example,
seeking to enhance quality service through training
Team level ? Motivation and performance
? Team building
Individual level ? Improvement in knowledge, skills and attitudes
? Sustaining employability
? Enhanced motivation and performance
? Improving aspects of discipline and behaviour
? Career progression
there has been the training revolution claimed. This point recognizes that over
much of the preceding period the UK’s record on training was poor compared to
other nations such as Germany, Japan and Sweden who were felt to invest heavily
in training and development. For example, Holden (2004: 314) notes how, ‘Until
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 144
the 1980s, training and development in British organizations were inadequate com-
pared with other industrialized nations’. In this sense the UK has often been char-
acterized as voluntaristic with regard to training and development, meaning that
the state took a hands off view in terms of encouraging employers to train their
employees. Instead, individual employers were largely left to their own devices
with regard to how much, or indeed, how little training they would provide.
Consequently there has been much debate about the levels of training expenditure
both by Government and employers, with some expressing concerns that, if any-
thing, real expenditure on vocational education and training (VET) have fallen in
recent years. Hyman (1996: 306–307) exemplifies this scepticism in his recognition
that ‘what is more questionable … concerns the extent to which the majority of
British employers have taken responsibility for strategically training and develop-
ing their employees’, with much training simply being of the reactive ‘fire-fighting’
type. For many then there may be a gap between the perceived importance of train-
ing and the willingness to do something about it, with suspicions that in the UK too
many organizations still see training as a cost and not an investment. Indeed, it
could be argued that such a view may simply reflect the short-termism inherent in
British business, where corporate objectives tend to be short-term and defined by
short-term profit and financial criteria. Table 7.2 and HRM in practice 7.1 below
Table 7.2 VET policies and practices in selected countries
UK Germany Sweden Japan USA
Traditionally, Much more state State directed, Directed/voluntarist Voluntarist,
voluntaristic with direction, aiming to create with the state uncoordinated,
limited state encouraging an active labour setting and with emphasis
intervention a dual system of market approach enforcing training on individual
finance rather concentrating on to ensure standards. Large effort and
than industry theory or employees remain companies offering individual
oriented, class practice. employable. lifetime payment.
based. Employers are employment and
strongly significant training.
encouraged to
train.
Adapted from Holden (2004: 337) Human Resource Management: A Contemporary Approach 4/ed,
Beardwell, Holden and Claydon, with permission from Pearson Education Limited.
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highlight the impact of the above discussion on the VET policies and practices in
some selected countries.
Consequently there has been much support for the notion that Britain needs to
invest in training and development to ensure that it does not become a low-tech,
Review and reflect
Outline arguments for and against government intervention in support of training and
education.
TRAI NI NG AND DEVELOPMENT 145
HRM in practice 7.1 National skill-creation
systems and career paths in the tourism industry
in the UK, Germany and the US
Studies of the UK, Germany and the US have found that patterns of career development
and commitment to working in the tourism industry are strongly influenced by the national
VET system. Germany, which has a more structured approach compared to the UK and US,
encourages individuals to complete an apprenticeship prior to entering the tourism indus-
try. Such an apprenticeship means that Germany’s education and training system is geared
to produce a much higher proportion of qualified staff for the tourism industry. As a result
employees in Germany were able to secure relatively highly skilled and autonomous posi-
tions at an earlier age than their counterparts in the UK and the US. There is also evidence
which points to the greater productivity of German tourism employees over their British
and American counterparts. One report concluded that Germany’s high productivity and
service levels are due to the wider use of qualified manpower trained through the partner-
ship arrangements for the dual system. This study notes that craft qualifications were held
by 2.5 times as many employees in Germany compared to the UK. A conclusion to be
drawn is that the dual system within which German employees for tourism are trained
‘embeds’ commitment to the sector to a much greater degree than elsewhere and this,
combined with high levels of reward, contributes to a greater sense of professionalism and
productivity. Finally, German employees were also more likely to advance more rapidly
within the industry due to the training and education they receive.
Derived from STRU (1998); Finegold et al. (2000).
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low-wage, low-skill, cheap labour economy wherein it seeks to compete on the
basis of a low-skill, low-quality product market strategy relying on price-based
competitiveness. What this has meant in practice is that in recent years the UK
government has attempted to take a more active role by introducing a range of ini-
tiatives that aim to improve skill levels in the economy. Indeed, Keep (2005) con-
siders the extent to which the UK may be entering a ‘post-voluntarist’ era, where
the Government is seemingly increasingly prepared to take a more active role in
encouraging learning and development. To an extent this change may be explic-
able by the sense that the UK is playing ‘catch up’ with a number of its international
competitors. Resultantly, the Government has introduced a number of initiatives
in recent year, such as National/Scottish Vocational Qualifications (N/SVQs),
Investors in People (IiP) and Apprenticeships. All of these initiatives attempt to get
employers to increase training and are now considered.
N/SVQs
The rationale for the introduction of N/SVQs in the late 1980s was to provide greater
coherence in vocational qualifications and thus the existing vocational structure
was rationalized into N/SVQs. N/SVQs are work-related, competence-based
qualifications, which are appropriate to all industries and all levels of employ-
ment, from the shop floor to the board room. N/SVQs are statements confirming
that the individual employee can perform to a specified standard and that they
posses the skills, knowledge and understanding which makes possible such per-
formance in the workplace. They provide a progressive route from Level 1, which
is semi-skilled through to Level 5, which recognizes the skills needed to be an
organizational leader. N/SVQs are important as they recognize achievements in
the workplace and are based on assessing work experience and achievements. In
terms of their broad equivalence to educational attainment then Level 2, for exam-
ple, is broadly similar to GCSEs, Level 3 is broadly equivalent to A/AS Levels or
Scottish Highers, Level 4 is higher national diploma/degree level and Level 5
is degree/postgraduate level (though within tourism and hospitality there are
currently no options to seek Level 4 or 5 N/SVQs).
In the tourism and hospitality industry the largest number of registrations has
tended to be at Levels 1 and 2, in areas such as food preparation and cooking and
serving food and drink (QCA, 2003). Hales (1996; and see also IRS, 1999) suggests
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the case for developing and implementing N/SVQs is largely based on two rea-
sons. First, their contribution in enhancing the competitiveness and performance
of the UK economy by widening access to training and qualifications. Second, the
benefits to participants (i.e. employees), in terms of increased recognition for work-
place ability and competence, with the effect of increasing job satisfaction, motiva-
tion, a sense of achievement and standards of work. Hales reports on five case
study organizations in the hotel sector. All of the case study organizations were
small businesses employing between 22 and 44 employees, and four of them had
adopted and continued to use N/SVQs, with one adopting and then subsequently
dropping them. Hales research suggested that those hotels which had adopted
and persevered with N/SVQs noted a pay-off in terms of better employee atti-
tudes and behaviour, increased service quality and an overall improvement in
business performance. However, he does remain sceptical about the extent to
which N/SVQs may penetrate the small tourism and hospitality business sector
generally, unless they are given active encouragement.
Others such as Lucas (1995) have been rather more critical of the qualification.
Lucas suggests that Levels 1 and 2 arguably do not fit the criteria of training as sys-
tematically developing knowledge, skills and abilities. Consequently they represent
‘qualifications without substance [and] lack any real sense of meaning or value’
(Lucas, 1995: 60). Lucas’ criticisms reflect more general critiques of N/SVQs with
worries about their skill levels and whether they are too narrowly defined and task
specific. There is also some disquiet about the overly bureaucratic nature of
N/SVQs. The final criticism which rather reflects all of the above is the argument
that there is little evidence that N/SVQs are able to cope with changing technolo-
gies, skill requirements and new methods of work (and for further discussion of
the problematic aspects of N/SVQs or somewhat more cynically ‘No Value or
Quality’, see Foote, 1999; Druce, 2004).
Investors in people
The second initiative is IiP, which is a national level initiative run by IiP UK and
administered locally by Learning and Skills Councils (LSC) (Learning and Enterprise
Councils in Scotland) under the supervision of IiP UK. IiP is designed to be appli-
cable to all organizations whether large or small, public or private, manufacturing
or service. IiP attempts to link training and development to business strategy and
TRAI NI NG AND DEVELOPMENT 147
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as a result improve business performance and secure competitive advantage for
organizations. At its inception in 1991 organizations were expected to demonstrate
their adherence to a number of general principles in order to qualify for the IiP
Standard. The four general principles were:
1 Commitment: An IiP makes a public commitment from the top to develop all
employees to achieve its business objectives.
2 Planning: An IiP regularly reviews the training and development needs of all
employees.
3 Action: An IiP takes action to train and develop individuals on recruitment and
throughout their employment.
4 Evaluation: An IiP evaluates the investment in training and development on
performance of individuals, team and the organization to assess and improve
effectiveness.
Organizations seeking IiP accreditation were tested against these four prin-
ciples, which were measured using 23 indicators, later reduced to 12. More recently,
following an extensive process of consultation with employers and organizations
such as the Trade Union Congress, Confederation of British Industry and the
Chartered Institute of Personnel and Development, the Standard was revised and
re-launched in November 2004. The new Standard has three principles; plan, do
and review and these are underpinned by 10 indicators of good practice, as indi-
cated in Figure 7.1.
At the time of writing nearly 40000 organizations across the economy as a
whole had achieved the Standard (IiP, 2005). Generally, evidence from a range of
studies suggests that the initiative has had a positive impact on those organizations
gaining the accreditation (e.g. see Alberga et al., 1997). Hoque (2003: 565), whilst
offering some caveats as to the success of the Standard, concludes that ‘on average,
training practice is better in IiP-accredited workplaces than in non-accredited
workplaces’. Equally in relation to the tourism and hospitality industry a number
of case studies point to the manner in which IiP can improve organizational per-
formance (e.g. see Georgeson, 1999; HRM in practice 7.2).
Supporters of IiP would therefore argue that the standard thus improves
business performance, with increases in aspects such as turnover, efficiency, prof-
itability, enhanced customer service and improvements in company image; and
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HRM outcomes, such as lower labour turnover, improved skills and competences,
improved communications and increased motivation. At the same time there are
also some criticisms, as outlined in HRM in practice 7.3.
Notwithstanding some of the criticisms IiP seems to have established itself
as a positive and important attempt to encourage employers to adopt more
systematic approaches to training and development to improve organizational
performance and competitiveness. Indeed, it could be argued that the success of
the standard can be gauged by the recognition on the IiP UK website, http: //
www.investorsinpeople.co.uk, that IiP has been adopted in over 30 countries as an
example of attempting to encourage best practice HRD and improving the com-
petitiveness of the country (e.g. see Kidger et al., 2004).
TRAI NI NG AND DEVELOPMENT 149
7
Involvement
and empowerment
8
Learning
and development
9
Performance
measurement
10
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improvement
1
Business
strategy
2
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strategy
3
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management
strategy
4
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management
strategy
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effectiveness
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Figure 7.1 The principles of the IiP Standard, Source: IiP (2004: 5) reproduced with kind
permission of Investors in People UK, © Investors in People, 2006
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 150
HRM in practice 7.2 Improving training at Pontins
Pontins is a British company that has a number of holiday centres which are catering pri-
marily for families. The vast majority of Pontins employees are seasonal workers, many of
whom will only work for the company for a short period of time. Despite the relatively
high turnover of staff that this situation creates the company’s commitment to the IiP
Standard means that all employees have the opportunity to improve, no matter how
short their stay is with the company. Drawing on the IiP guidelines the company now has
a structure which means that every employee will have a personal development file with
job description and aims, access to NVQs, access to funding for vocational training, assist-
ance with professional qualifications and assessment of aims and goals and help achiev-
ing them. So even those employees who only stay a short period of time can gain a new
qualification. As well as increasing the amount of training and delivering higher stand-
ards of service, the company has also seen improved employee retention, resulting in
greater productivity and reduced costs.
Derived from http://www.investorsinpeople.co.uk/IIP/Web/Case+Studies/Pontin.htm
HRM in practice 7.3 Investing in people:
at what cost?
Amanda Scott, then General Manager of the Copthorne Hotel in Glasgow, suggests that
in many respects IiP embodied what any good manager should be doing – investing in
their people. However, she also outlined a number of criticisms. Many companies that
have attained the IiP Standard often already have good HR systems and procedures in
place so gaining the award may simply be nothing more than a ‘badging’ process.
Moreover it is a badging process that generates a lot of paperwork and bureaucracy,
with the awarding body often using obscure and confusing jargon. She also suggests
that the cost of IiP accreditation may well be prohibitive, ‘As a management model it can
deliver, but in my opinion £4000 for the privilege of a branding exercise … cannot be jus-
tified. It if was my personal money? I don’t think so’. This latter point concerning the
costly nature of IiP accreditation could be particularly important for smaller companies
who predominate in tourism and hospitality. The CIPD has recently estimated that the
total cost of seeking IiP is between £5000–£15 000 depending on the size of the organ-
ization and how much consultancy support the organization uses.
Derived from Scott (1999); CIPD (2006).
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Apprenticeships
Government-subsidised apprenticeships were first introduced in 1995 as Modern
Apprenticeships. Such apprenticeships aim to offer a career to those more motivated
by workplace learning, rather than pure academic study. The aim was to take the best
aspects from traditional apprenticeship schemes, update them and extend them to the
service and public sectors (Gospel and Fuller, 1998). The scheme was recently
re-launched in May 2004 as Apprenticeships, though in Scotland they remain Modern
Apprenticeships. Apprenticeships are primarily aimed at 16–24-year olds (though at
the time of writing there are also pilot programmes for those aged 25-plus) who want
to obtain intermediate skills by combining a paid job with training. There are two
levels, the Apprenticeship is for 2 years and at the end of this period the apprentice
will achieve an NVQ Level 2 (National Vocational Qualification); there is also the
Advanced Apprenticeship, which is for a period of 3 years and leads to NVQ Level 3.
The Apprenticeship alternates between productive employment with on- and off-the-
job training to provide a mixture of occupationally specific training as well as more
generic key skills, such as communication, numeracy, literacy and teamworking.
Early accounts of the implementation of Modern Apprenticeships in tourism
and hospitality offered guarded optimism with regard to their ability to attract
young people to work in the industry. Mason (1997) recognizes how the scheme
had attracted around 7000 young people by 1997, with the aim of having 10000
apprentices by 2000. Mason reports on the success of the scheme within De Vere
Hotels, which was aiming to have 100 apprentices across the UK by the end of 1997.
The company reported that the scheme allowed them to embed and maintain a
strong training culture within trainees. Trainees were also fully immersed in the
company’s organizational culture, the ‘De Vere Way’, which allowed the company
to develop future managers. Similarly, Yates’ Wine Lodge report a number of
benefits from operating the scheme such as improved staff retention and loyalty,
improved staff morale, enhanced skill sets for employees and more efficient and
productive employees (Anon, 2003a). Whilst the examples of De Vere and Yates
offers a positive view of Modern Apprenticeships other accounts are less encourag-
ing. For example, Manson (2005) reports on a survey conducted for the LSC which
found that only 920, or 4 per cent, of 23000 hospitality employers were looking to
offer apprenticeships in hospitality. Concerns have also been expressed at the high
drop out rate, with around 80 per cent of hospitality apprentices leaving before
completion (Anon, 2003a).
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Industry level
The above discussion has considered the manner in which the VET infrastructure
created by government will have a profound impact on training and development.
Clearly with the creation of initiatives such as N/SVQs, IiP and Apprenticeships
British Governments over the last 20 years or so have attempted to encourage
employers to offer more training. Whilst all of these initiatives have had some
impact in tourism and hospitality, they are not sector specific, unlike another gov-
ernmental initiative, the creation of Sector Skills Councils (SSCs). IDS (2005: 14)
notes how ‘the overall aim to SSCs is to help employers within similar industries to
improve their employees’ skills base and to provide them with leverage, influence,
support and expertise in this pursuit’. Although SSCs are funded by Government
they are run by employers, who work in partnership with a range of stakeholders
in each sector to (Marchington and Wilkinson, 2005):
? Produce intelligence and analysis of future sector skill needs.
? Reduce skill gaps and shortages by influencing the planning and funding
education and training.
? Improve productivity.
? Develop occupational standards for skills in their sector.
? Increase opportunities for everyone in work to boost skills.
As noted in Chapter 1, the SSC for tourism and hospitality is People 1st, which
came into existence in May 2004. People 1st’s mission in the period 2004–2009
is to have an impact on completion rates for qualifications and learning pro-
grammes, investment in training, raising employee skill and productivity levels
and reducing staff turnover through lifelong career development (People 1st,
2004). By the end of People 1st’s first year of existence there was some disquiet as
to its influence (Druce, 2005), though it is too early to offer any definitive comment
on the impact of People 1st in improving skills and training within tourism and
hospitality.
In addition to governmental initiatives, there are also non-governmental ini-
tiatives which have attempted to improve training within tourism and hospitality,
such as Welcome Host, which is described in HRM in practice 7.4.
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Training and development: no longer a dichotomy?
Having outlined the broad context in which organizations are developing their
overall approach to training and the importance of Government policy within that
process, we can now go on and look in greater detail at what exactly training and
development are. Holden (2004: 313) recognizes how, ‘it is difficult to arrive at a
consensus definition of terms such as “development”, “education” and “training”
because of the varied ways in which they are translated into work and life situ-
ations’. Many would argue that training and development have traditionally been
seen as separate and a reflection of an organization’s hierarchy. This point can be
appreciated in acknowledging the manner in which training and development
have been traditionally conceptualized as being distinctive activities.
TRAI NI NG AND DEVELOPMENT 153
HRM in practice 7.4 Welcome Host:
Professionalizing the tourism industry?
The Welcome Host scheme is based on Canadian hospitality programme called
‘Superhost’. Introduced in British Columbia in 1986 to support the growth of tourism
around the world expo in Vancouver. Other franchises include: ‘Kiwi Host’, ‘Aussie Host’,
‘Alaska Host’ and ‘Super Host Japan’. Sweeney (1995: 8) describes Welcome Host as, ‘an
ongoing, comprehensive, community-based programme designed to upgrade the stand-
ards of service and hospitality provided within the tourism industry … By involving the
whole community, the scheme provides access to more formal training for the smaller
operator who may also come into contact with the visitor’. The basis of Welcome Host is
people helping people and its objectives are about aiming to instil a sense of profession-
alism and pride in tourism. Importantly, Welcome Host is not just for tourism employees,
such as travel agents and tour guides, but can also be taken by people like taxi drivers and
traffic wardens and anybody else that tourists are likely to encounter in the destination. In
addition to Welcome Host there are also a number of other programmes such as Welcome
All, which is a course designed to help individuals acquire the knowledge and skills essen-
tial for providing facilities and services that meet the specific needs and expectations of
people with disabilities and special needs; and Welcome International which is a training
programme designed to give people working in the tourism or hospitality industry greater
confidence when meeting and greeting international visitors in another language.
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On the one hand, training is ‘a planned process to modify attitude, knowledge
or skill behaviour through learning experience to achieve effective performance in
an activity or range of activities. Its purpose, in the work situation, is to develop the
abilities of the individual and to satisfy the current and future manpower needs of
the organization’ (MSC 1981, cited in Armstrong, 1999: 507). On the other hand,
development has often been seen as being much more about the growth or realiza-
tion of a person’s ability through conscious or unconscious learning. Development
programmes also usually include elements of planned study and experience, and
are frequently supported by a coaching or counselling facility. In that sense training
was often perceived as being for non-managerial staff, whilst development was the
preserve of managers, and this reflected the more nebulous concepts of reasoning,
abstraction and personal growth (see Baum, 2006: 204–214 for further discussion
of this issue). Now though it is increasingly recognized that within a HRM/HRD
approach organizations will see the two aspects as being very much interconnected
so training should be seen as part of and a precondition of development.
Training and development then can be seen as a key instrument in the implemen-
tation of HRM practices and policies and there may be a number of benefits from
undertaking training. For example, McKenna and Beech (2002) suggest a number
of benefits generally stemming from training, including:
? Helps employees learn jobs more quickly and effectively.
? Improves work performance of existing employees and keeps them up to date
in specialist skills.
? Leads to a greater volume of work resulting from fewer mistakes and greater
rapidity.
? Frees management time, less of which is spent rectifying errors, also reduces
wastage.
? Can help to reduce turnover among new and established staff.
Review and reflect
If you are currently undertaking a tourism or hospitality degree to what extent do you
consider it to be training, education or development? What are some of the influences
in making your decision?
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? Incorporating safety training can help reduce accidents.
? Can help to attract good workers.
? Is a precondition for flexible working.
? Creates an attitude more receptive to coping with change.
? Operationalizing certain management techniques, for example Total Quality
Management (TQM) and empowerment (see HRM in practice 7.5).
Whether organizations accept the arguments for the benefits of training might
reflect whether they are one of two types of organizations, who are characterized
as having extreme training positions – the road to failure or the road to success.
? The road to failure
– Afailure to recognize or implement management practices designed to meet,
not only existing, but future skills needs.
TRAI NI NG AND DEVELOPMENT 155
HRM in practice 7.5 Training and TQM in the
restaurant industry in Canada
Salameh and Barrows (2001) recognize how a critical element of TQM is creating an orga-
nizational culture which is supportive of quality and customer satisfaction. TQM also
requires that all members of an organization are involved in the process of quality improve-
ment. Training therefore becomes crucial to the implementation of TQM. Research con-
ducted by Salameh and Barrows in a coffee house restaurant and a casual dining restaurant
in Canada demonstrated a number of similarities in the respective restaurants. Training pro-
grammes differed from job to job depending on the complexity of the job and associated
tasks, and the length of time also varied. Both companies also used a range of training
methods, such as on-the-job training, videos, seminars and extensive induction pro-
grammes. The case study organizations also recognized the challenges of training, includ-
ing the time factor, keeping programmes simple, being proactive rather than re-active, and,
in a mirror of the intent of TQM, seeing training as a process of continuous improvement.
Managers suggested that there were a number of positive outcomes from training in
support of TQM, including decreased labour turnover, greater employee commitment,
increases in sales, greater customer responsiveness and enhanced quality service. In sum,
the research suggested that training did result in a continuous performance improvement,
a key goal in TQM.
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– An unrealistic reliance by managers upon national and local labour markets
to satisfy company skills at whatever level.
– A willingness to regard the practice of poaching the skilled labour of others
as the chief response to skill pressures, regardless of the consequences at
company level and in pay in inflation terms.
? The road to success
– Progress through the sharing of a common vision, from top management
through every level of the organization.
– High status being accorded training and development practices based upon
results and their relevance to the needs of the organization.
– Company structures which allow for the development of individuals and
encourages the acquisition of skills to meet business goals.
– Business systems flexible enough to accommodate investment in people, with
agreed budgets and clear targets subject to regular evaluation.
If we consider which one of these archetypes tends to describe tourism and hospi-
tality industry as a whole then it may well be that the balance of evidence suggests
the road to failure best describes the industry. Lucas (2004), for example, argues
that the industry remains relatively unqualified and access to training tends to be
restricted to those in large multi-establishment organizations. That said, there are,
of course, examples of sophisticated and systematic training and development
programmes in some companies (see HRM in practice 7.6).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 156
HRM in practice 7.6 The training Oscars
Set up in 1987 by the then Department for Education and Science the National Training
Awards are the UK’s number one accolade for businesses, organizations and individuals
who achieved lasting excellence and success through training and learning. In recent
years there has been some success for the tourism and hospitality industry. For example,
in 2003 five companies triumphed in a multi-sector field of 1000 entries. For the com-
petition that year entries for the national competition increased by 25 per cent, but for
the hospitality sector there was a 70 per cent rise in applicants. In the most recent awards
in 2005 Nando’s, the Chicken restaurant chain, won awards for its outdoor management
development programme and its staff training programme.
Derived from Anon (2003b); Hope (2005).
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There is also the further point that the structure of the industry in terms of firm
size. With the predominance of small firms there is greater likelihood of informal
proprietor and on-the-job training (OJT). Moreover, training incidence is at its low-
est in non-standard forms of employment, for example workers who are numer-
ically flexible are likely to get little or no training. There may be an important role
though to be played by the SSC, People 1st. The success model views training as
an integral part of core organizational strategy, rather than an ad hoc operational
issue. Moreover, this notion would seem to be a precondition for any claims to be
an HRM organization which is practicing soft HRM. Ultimately, then there may be
those organizations who see training as an investment and those who pay lip ser-
vice to the idea of training and in the good times spend money on training and in
the bad times spend less or hardly anything on training. Consequently, a lot of
organizations will, in times of skill or labour shortages, recruit from other organ-
izations rather than invest in their existing employees, something that has certainly
been apparent in tourism and hospitality.
Conducting training
We have examined in some detail the wider picture of training and in this section
of the chapter we can now move on to consider the manner in which training may
be conducted and training methods used by organization. To contextualize this
discussion it is worth noting the three broad categories in which training is likely
to be located, these are (Marchington and Wilkinson, 1996):
? Socialization initiative: Particularly in terms of induction and becoming familiar
with the prevailing organizational culture.
? Development initiative: This is more concerned with developing individuals, for
example, preparing for promotion, coping with new technology or organ-
izational change, such as attempting to become a more customer focused
organization.
? Disciplinary initiative: Where some sort of training is offered to individuals who
have fallen below the organizations acceptable level of quality, output or cus-
tomer standards, and this could be about rectifying deficiencies in technical
skills or attitudinal training.
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In terms of developing the training there is the potential for huge variations
in how organizations go about devising and delivering training. Additionally,
Marchington and Wilkinson (2005) note that trainees themselves will bring signifi-
cant ‘baggage’ to the learning event, for example the mix of prior knowledge,
skills, attitudes, motivations and expectations. Furthermore trainees may also have
very diverse reasons for being involved in the training, for example, some trainees
may be there under duress. Consequently, we should be cautious in terms of being
too prescriptive in describing how organizations should approach training.
Nevertheless, there would seem a need to have some sort of systematic approach
to developing training. For example, Go et al. (1996) advocate the need for a sys-
tematic approach as outlined in their nine-step approach to developing training
within the organization.
Step 1: Assessing training needs
Analysing training needs is a crucial part of HRD as the identification of needed
skills and active management of employee learning is integral to developing cor-
porate and business strategies. Many would argue that for training to be effective it
is necessary to discern not only the training needs of the individual and the group,
but also how their needs fit the overall organizational objectives. Essentially then
training needs analysis allow for an appreciation of the need to ensure that there is
a fit between training and the company culture, strategy and objectives. Equally,
the training needs of the individual needs to be reconciled with those of the organ-
ization. In terms of developing a training needs analysis aspects such as job
descriptions, job analysis, person specifications or whether performance objectives
agreed at appraisals have been met may all potentially be useful indicators.
Step 2: Preparing the training plan
The training plan is concerned with outlining what needs to be done based on the
training needs of individuals, departments and the organization as a whole. In effect
the training plan provides an outline sketch of what the training should address, as
well as considering practical aspects such as the method, time and location of the
training.
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Step 3: Specifying the training objectives
A key question to be asked before the training is operationalized is: what are the
training objectives? It is important when employees are undertaking training that
they understand what they should be able to accomplish when the training pro-
gramme has been completed.
Step 4: Designing the training programme
Go et al. (1996) suggest a number of issues need to be considered in designing the
training programme, including:
? Programme duration.
? Programme structure.
? Instructional methods.
? Support resources (e.g. a training facility) and the selection of training materials
(e.g. videos).
? Training location or environment, which may also be determined by the task,
for example, whether it involves practical skills.
? Instructor and instructors experience.
? Origin of the training programme.
? Criteria and methods for assessing participants learning and achievement.
? Criteria and methods for evaluating the programme.
Step 5: Selecting the instruction methods
There are a multitude of methods that organizations can use to train and develop
staff. All of these various methods will have both strengths and weaknesses and
in that sense there is no one ‘best’ training method. Rather, there is a need for
organizations to adopt a contingent approach to training in developing training
methods. Although there are a great variety of training methods, generally most
writers broadly categorize them into three different types of training, in-company
on-the-job, in-company off-the job and external off-the-job, all of which are now
briefly considered.
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In-company, on-the-job
This type of training is enduringly popular and accounts for about half of all the
training delivered across all industries and sectors in the UK (CIPD, 2005). Often
known colloquially as ‘sitting next to Nellie’, OJT training involves learning
through watching and observing somebody with greater experience perform a
task. OJT is a very popular method of training where new skills and methods are
taught to employees. The advantages of OJT is that it is cheap, the trainees get the
opportunity to practice immediately, trainees get immediate feedback and it can
also help in integrating trainees into existing teams. Equally, there may be some
drawbacks from this type of training. ‘Nellie’ may not be trained herself in skills
and methods of training, which will often lead to training being rather piecemeal
or not properly planned. Equally, Nellie may also pass on bad habits, although
increasingly organizations may use the idea of training the trainer to ensure a
more professional approach.
Another variant of OJT is mentoring, wherein a senior experienced member of
staff takes responsibility for the development and progression of selected individ-
uals. Ordinarily this process of mentoring would be for managerial staff and the
selected individual will often be somebody who has aspirations to reach senior man-
agement levels. This type of relationship is more like father–son or mother–daughter
than that of traditional master–apprentice. The trainee, or mentoree, will observe the
skills displayed by the mentor and learn from their experience. Mentoring can also
be a useful two-way process in terms of the mentor becoming more reflective about
their own job and being forced to think about ways of improving their own per-
formance. In a similar vein, shadowing allows employees the chance to see different
part of the organization in other departments. Finally, under the broader heading of
OJT is the idea of job rotation. In this approach those undergoing the training are
placed into a job without any prior training, when they have learnt that job they
move on to another job and so on, this may also eventually lead to multi-skilling or
functional flexibility, as discussed in Chapter 4.
In-company, off-the-job
In contrast to OJT, off-the-job training takes place outside of the employee’s nor-
mal place of work. Off-the job training will often involve a training intervention
run by a specialized training department. This type of training could be relatively
straightforward (see HRM in practice 7.7) or be concerned with achieving profi-
ciency in more advanced skills.
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There is a wide array of other methods that come under the broad heading of
off-the-job training. In a relatively passive sense lectures can be good for the trans-
mission of information to a relatively large number of trainees. Indeed, it is likely
that most of us in our student, organizational or professional life will have sat
TRAI NI NG AND DEVELOPMENT 161
HRM in practice 7.7 Heading off the
induction crisis
Induction is often misunderstood as simply being about inducting people into the organ-
ization during the first day in a new job. However, induction will often extend beyond the
first day and may involve events up to 12 months after the initial appointment. The need
for a period of induction is increasingly seen as being important in socializing employees,
especially in strong culture organizations, an issue considered in Chapter 3. In addition it
may also be crucial to address the problem of the so-called ‘induction crisis’, where a new
work environment can be perplexing and even frightening for new employees. As a result
employees may leave the organization during this period. Induction will not axiomatically
always avert an induction crisis, but a well-designed induction programme can go some
way to addressing this issue. Typically in inducting new employees’ tourism and hospital-
ity organizations are likely to consider the following aspects:
? History of the organization
? Consideration of the mission statement and organizational
objectives
? Outline of company ethics
? The structure of the organization
? Appearance standards
? Uniforms and dress codes
? Pay systems and benefits
? Holiday and sickness arrangements
? Rules and regulations of the organization
? Discipline and grievance procedures
? Details of any trade unions or staff associations
? Welfare policies and social facilities available in the organization
? Health and safety measures
? Introduction to immediate supervisor/line manager
? Introduction to fellow workers
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through a lecture. Often the quality of a lecture will be dependent on the individ-
ual who is delivering it. Notwithstanding this point it is generally recognized that
the maximum concentration span of most individuals is typically less than 20 min-
utes. In a rather more active vein there are a number of other methods which will
involve greater interactivity. For example, case studies, role plays and simulations
may all be usefully used by tourism and hospitality organizations, particularly in
developing customer service skills. Lastly, there may also be opportunities for
employees to learn via interactive computer learning packages, or what is often
termed e-learning, something which British Airways has developed with some
success, as outlined in HRM in practice 7.8.
External, off-the-job
The final aspect of training is that which again is undertaken off-the-job, though in
this instance it is external to the organization. In an era of continuing professional
Review and reflect
Think of any on-the-job or off-the-job training which you have undertaken in the work-
place. Which was most useful and satisfying and why?
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 162
HRM in practice 7.8 A flying start
Trapp (2003) notes how British Airways first introduced e-learning in 2000 initially to a
large degree of scepticism from their employees. Since then though the take-up of
e-learning opportunities has increased significantly amongst their staff. The technology
has been used in several ways, for example in helping with the introduction of a new check-
in system. British Airways staff are particularly drawn by the flexibility of e-learning,
which allows them to learn when they want to learn. Employees can also do as much or
as little as they wish. Elements which are covered by e-learning may be job specific, such
as allowing cabin crew staff to brush up on specialist safety training or improving knowl-
edge of wines; to more generic training such as learning how to make PowerPoint
presentations.
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development employees may be encouraged to undertake formal study to
enhance their careers, for example taking courses such as the Chartered Institute
of Personnel and Development’s courses for personnel/HRM managers or in a
more general sense a Master in Business Administration (MBA). Afurther aspect
of external off-the-job training is what is termed outward bound courses. Outdoor
training ordinarily consists of a series of exercises which act as an opportunity for
team building, problem solving or leadership skills to be developed outside of
an employee’s or manager’s ‘comfort zone’ (Trotter, 2005). In recent years such
courses have grown enormously in popularity and there have been a number of
hospitality and tourism organizations who have offered this kind of training,
including Hilton and Thomas Cook. Some castigate this type of training as a fad or
fashion with limited application to commercial situations or more seriously unsafe
or downright dangerous, especially if there is too much emphasis on physical
challenges or exercises. Some argue though that is this type of training is done
properly and managed by experienced and qualified trainers outdoor-based
development can offer a highly effective tool for improving managerial perform-
ance in particular.
Step 6: Completing the training plan
With the establishment of the main design features and the methods which are to
be used, the training plan can now be completed. Go et al. note that a complete
training plan will have details about the target group (e.g. all service staff), the
topic to be considered (e.g. customer handling), method(s) to be adopted (e.g. role
play), time (e.g. two hours) and location (e.g. conference centre).
Step 7: Conducting the training
Go et al. suggest that if other aspects of the nine-step approach are adhered to the
training activity/programme should be effectively delivered. Though rather like
Marchington and Wilkinson they do also recognize a number of factors that might
impact on the training, such as participant selection, ensuring the group feels com-
fortable physiologically and psychologically and ensuring the person delivering
the training is properly prepared and has the right skills.
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Step 8: Evaluating the training
The penultimate stage of the nine-step approach is to evaluate the training in order
to glean feedback from the trainees. There are a number of methods of evaluating
training, as identified by Holden (2004: 328):
? Questionnaires or so-called ‘happiness sheets’ are a useful way to elicit trainees’
responses to courses and programmes.
? Tests or examinations are common in more formal training courses and are
useful for checking the progress of trainees.
? Projects can be useful in providing useful information for instructors.
? Structured exercises and case studies allow for trainees to apply their learned
skills and techniques under observation.
? Tutor reports allow for instructors to offer an assessment of the utility of the
training.
? Interviews of trainees can be formal or informal, individual or group, or by
telephone.
? Observation of courses by those responsible for devising training strategies can
be very useful in the development of future training.
? Participation and discussion during the training, though this requires a highly
skilled facilitator.
? Appraisal allows for the line manager and trainee to consider the success or
otherwise of training that has been undertaken during performance reviews.
Of course a combination of these methods can be used in evaluating training and
it is likely to be important to incorporate both trainee and trainer feedback in
assessing the success or otherwise of training interventions.
Step 9: Planning further training
After the training and its evaluation, training has, in effect, come full circle and the
planning process can begin again.
Conclusion
Training and development can be understood at a number of levels and it is particu-
larly important to recognize the likely impact of government policy, in particular,
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in creating the VET infrastructure in which organizations will develop their policy
and practice. Governments may either be relatively proactive in attempting to cre-
ate an environment where training and development is seen as crucial or much
more voluntaristic in leaving such decisions to organizations. For a long time the
UK Government adopted a voluntaristic approach to training but it has become
increasingly involved in developing training initiatives in recent years to address
a perceived gap in training. In addition to the national level infrastructure we also
recognized that the sectoral level is equally important and notwithstanding the
emergence of initiatives such as Excellence in People and Welcome Host, tourism
and hospitality has often been perceived as a sector with an indifferent training
record. Notwithstanding debates about the provision or otherwise of training in
tourism and hospitality when organizations do train they can draw upon a variety
of differing methods, which are likely to differ in relation to differing occupations
and skills. In that sense there is no one best training method, but rather different
methods and techniques will be appropriate given the nature of the task and skills
demands and importantly what is most cost effective for organizations.
References and further reading
Alberga, T., Tyson, S. and Parsons, D. (1997) ‘An evaluation of the Investors in People standard’, Human
Resource Management Journal, 7(2), 47–60.
Anon (2003a) ‘Staying the course’, Hospitality, March, 16–17.
Anon (2003b) ‘Hospitality companies fare well in training awards’, Caterer and Hotelkeeper, 18 December, 10.
Armstrong, M. (1999) A Handbook of Human Resource Management Practice, Kogan Page,
7th edition.
Baum, T. (2006) Human Resource Management for Tourism, Hospitality and Leisure: An International
Perspective, Thomson Learning.
Chartered Institute of Personnel and Development (2005) On-the-Job Training Factsheet, CIPD.
Chartered Institute of Personnel and Development (2006) Investors in People Factsheet, CIPD.
Druce, C. (2004) ‘NVQs fail to meet the industry needs, agree colleges and employers’, Caterer and
Hotelkeeper, 21 October, 9.
Druce, C. (2005) ‘Hospitality waits for People 1st to deliver results on skills crisis’, Caterer and Hotelkeeper,
12 May, 6.
Finegold, D., Wagner, K. and Mason, G. (2000) ‘National skill-creation systems and career paths for service
workers: hotels in the United States, Germany and the United Kingdom’, International Journal of
International Human Resource Management, 11(3), 497–516.
Foote, R. (1999) ‘NVQs: tension from both sides’, Hospitality Review, October, 12–16.
Georgeson, R. (1999) ‘Case studies: Investors in People: Ruffles Country House Hotel, St Andrews and The
Willow Tea Rooms’, The Hospitality Review, January, 21–25.
Go, F., Monachello, M. and Baum, T. (1996) Human Resource Management for the Hospitality Industry,
Wiley.
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Gospel, H. and Fuller, A. (1998) The Modern Apprenticeship: new wine in old bottles? Human Resource
Management Journal, 8(1), 5–22.
Hales, C (1996) ‘Factors influencing the adoption of NVQs in small hospitality businesses’, International
Journal of Contemporary Hospitality Management, 8(5), 5–9.
Holden, L. (2004) ‘Human resource development: the organization and the national framework’, in
I. Beardwell, L. Holden and T. Claydon (eds.) Human Resource Management: A Contemporary Approach,
Prentice Hall, 4th edition, 313–360.
Hope, K. (2005) ‘Class act’, People Management, 15 September, 16–17.
Hoque, K. (2003) ‘All in all, it’s just another plaque on the wall: the incidence and impact of the Investors
in People standard’, Journal of Management Studies, 40(2), 543–571.
Hyman, J. (1996) ‘Training and development: the employer’s responsibility?’ in B. Towers (ed.) The
Handbook of Human Resource Management, Blackwell, 2nd edition, 306–328.
Income Data Services (2005) Understanding Sector Skills Councils, HR Studies Update, No. 791, February.
Industrial Relations Services (1999) ‘NVQs and SVQs mean business’, Employee Development Bulletin, No.
109, January, 6–14.
Investors in People (2004) Moving Your Organization Forward: The Investors in People Standard, IiP UK.
Investors in People (2005) Company Report 2004–2005: Stepping in the Right Direction, IiP UK.
Keep, E. (2005) ‘Skills, training and the quest for the holy grail of influence’, in S. Bach (ed.) Managing
Human Resources: Personnel Management in Transition, Blackwell, 4th edition, 211–236.
Kidger, P., Jackson-van Veen, M. and Redfearn, D. (2004) ‘Transferring the Investors in People concept from
the UK to The Netherlands’, Journal of European Industrial Training, 28(6), 499–518.
Lucas, R. (1995) Managing Employee Relations in the Hotel and Catering Industry, Cassell.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
Manson, E. (2005) ‘Hospitality lags behind other industries over apprenticeship scheme’, Caterer and
Hotelkeeper, 7 April, 8.
Marchington, M. and Wilkinson, A. (1996) Core Personnel and Development, CIPD.
Marchington, M. and Wilkinson, A. (2005) Human Resource Management at Work: People Management
and Development, CIPD, 3rd edition.
Mason, A. (1997) ‘Apprenticeships – do they work?’ Hospitality, September/October, 26–27.
McKenna, E. and Beech, N. (2002) Human Resource Management: A Concise Analysis, Pearson Education
Limited.
People 1st (2004) ‘Permanent CEO for new skills body’, People 1st Press Release, 7 October 2004.
Qualifications and Curriculum Authority (2003) Establishing Qualification Requirements: Hospitality and
Catering Industry, QCA.
Salameh, M. and Barrows, C. (2001) ‘The role of training in achieving TQM in restaurants’, Journal of
Quality Assurance in Hospitality and Tourism, 1(4), 73–95.
Scott, A. (1999) ‘Investing in people?’ The Hospitality Review, January, 25–30.
Scottish Tourism Research Unit (1998) International Benchmarking and Best Practice Study of Training and
Education for Tourism, STRU.
Sweeney, A. (1995) ‘Improving interpersonal relationships between staff and visitors with the “Welcome
Host” scheme’, Proceedings of the Fourth Annual Council for Hospitality Management Education
(CHME) Research Conference, University of Brighton, 101–119.
Trapp, R. (2003) ‘A flying start’, People Management, 6 February, 36–38.
Trotter, A. (2005) ‘Smells like team spirit’, Guardian Office Hours, 21 March, 2–3.
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Websites
Details of the various programmes run by Welcome Host can be found at http://www.welcometoexcellence.
co.uk/WIIndex.htm
Details of the British Hospitality Association’s Excellence Through People scheme can be found at http://
www.etp.org.uk/Home/Default.aspx
Investors in People has a number of case studies, including several from the tourism and hospitality sector at
http://www.iipuk.co.uk/IIP/Web/Case+Studies/default.htm
For details of the UK training and education framework visit the QCA website at http://www.qca.org.uk/
The American Society for Training and Development has some useful resources on workplace training and
learning at http://www.astd.org/astd
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Chapter 8
Performance
management and
performance appraisal
Chapter objectives
This chapter discusses performance management
and performance appraisal. Specifically, the aims
of the chapter are:
? To appreciate the difference between
performance management and performance
appraisal.
? To consider challenges facing tourism and
hospitality managers in operationalizing
performance appraisal schemes.
? To explore the differences between evaluative
and developmental aspects of performance
appraisal.
? To recognize the range of skills required by
tourism and hospitality managers to
successfully conduct performance appraisals.
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Introduction
In considering the nature of performance management and performance appraisal
we firstly need to appreciate how these two aspects are related but equally should
not be seen synonymously. In fairly simple terms performance management can
be seen as a holistic process which aims to bring together a number of aspects,
including appraisal. Thus, performance management may be thought of as being
more strategic in its intent to achieve high levels of organizational performance. By
contrast, performance appraisal is best seen as being more operationally focused,
with a focus on individual employees short- to medium-term performance and
development (CIPD, 2005a). Consequently, to fully contextualize the notion of per-
formance appraisal it is important to locate it within wider issues concerned with
performance management systems (PMS) which may have an organizational, team
or individual focus. Armstrong (2001: 469) suggests that performance management
has a number of aims:
Performance management is about getting better results from the organiza-
tion, teams and individuals by understanding and managing performance
within an agreed framework of planned goals, standards and competing
requirements. It is a process for establishing shared understanding about
what is to be achieved, and an approach to managing and developing people
in a way which increases the probability that it will be achieved in the short
and long term. It is owned and driven by management.
Clearly, then, organizations are always seeking improvements in their perform-
ance and these can be sustained by either development-type initiatives or more
evaluative or even punitive measures, potentially encompassing aspects of discip-
line. In that sense performance management and performance appraisal can
arguably be seen to again reflect to some degree the notions of ‘hard’ and ‘soft’
HRM. For example, the harder approaches would point to the need for organiza-
tions and managers to seek control over their employees; on the other hand softer
approaches would point to the role of PMS in establishing greater commitment
and developing careers. Recognizing the above discussion this chapter will aim to
consider the question of what options are open to an organization seeking to
improve the performance of its employees.
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The nature of performance management and
performance appraisal
Recent research undertaken by the CIPD provides a snapshot of a number of fea-
tures of performance management, as outlined in Table 8.1.
Clearly one of the most important aspects of enhancing performance is per-
formance appraisal, which is a critical element of performance management and a
key feature of organizational life. As Bach (2005: 289) notes, ‘performance appraisals
have become far more than just an annual ritual and are viewed as a key lever to
enhance organizational performance’. Performance appraisal is defined by Heery
and Noon (2001: 7) as, ‘… the process of evaluating the performance and assessing
Table 8.1 Features of performance management
Feature Percentage
Individual annual appraisal 65
Objective setting and review 62
Personal development plans 62
Career management and/or succession planning 37
Coaching and/or mentoring 36
Competence assessment 31
Performance related pay 31
Self-appraisal 30
Twice yearly/biannual appraisal 27
Continuous assessment 14
360-degree appraisal 14
Subordinate feedback 11
Rolling appraisal 10
Peer appraisal 8
Competence related pay 7
Team appraisal 6
Contribution related pay 4
Team pay 3
Source: This material is taken from Managing Performance: Performance
Management in Action by Armstrong, M. and Baron, A., 2nd edition (2005), with
the permission of the publisher, the Chartered Institute of Personnel and
Development, London.
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the development/training needs of an employee’. LRD (1997: 3) similarly note
how performance appraisal is, ‘A process of reviewing individual performances
against pre-determined criteria or objectives, involving the gathering of informa-
tion, one or more meetings and some form of report which may include a per-
formance rating’. In sum, then, appraisal is a process that allows for an individual
employee’s overall capabilities and potential to be assessed for the purposes of
improving their performance.
A recent survey by IRS (2005a) suggests that over 90 per cent of workplaces
have some form of performance appraisal, usually a conventional top-down
appraisal system. Moreover there has been a shift in recent years which have seen
more and more organizational members subject to such appraisal, which had trad-
itionally been geared more to managerial staff. Clearly given the skills mix which
was discussed in Chapter 4, which points to a predominance of semi and unskilled
workers in tourism and hospitality, there may well be a questioning of whether it
is worthwhile appraising such workers, especially unskilled workers, as these jobs
are likely to involve little technical expertise. For example, notwithstanding the
earlier point about more organizational members being appraised, IRS (1999) sug-
gested that less than a quarter of organizations across the economy as a whole sur-
veyed semi or unskilled workers. If these employees are to be appraised some
difficulties may be encountered in attempting to establish readily observable stand-
ards and criteria by which performance can be measured. There may also be the
additional issue in tourism and hospitality of the predominance of small- and
medium-sized enterprises. Goldsmith et al. (1997) note that appraisal is unlikely to
be something that is realistic for a small family-concern type business or a single
person operation. Consequently they advocate that appraisal has certain min-
imum requisites or parameters, including (p. 165):
? the equivalent of at least 20 full-time non-managerial employees;
? a minimum of one layer of professional management between the organization’s
proprietor and operative staff;
? some evidence of departmentalization where individual departments have their
own heads or supervisors.
Given the above discussion it might seem reasonable to imagine that appraisal is
less likely to be a part of a systematic approach to HRM in tourism and hospitality.
However, the evidence seems to suggest that the opposite may in fact be true. For
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example, Lucas (2004) in her interrogation of the Workplace Employee Relations
Survey data, found that 85 per cent of managers in the hospitality and tourism
industry had responsibility for performance appraisal. Interestingly, Lucas also
found that performance appraisal is more likely to be used in the hospitality
industry compared to all private sector service organizations. Similarly, Hoque
(1999) found that 89 per cent of the 232 hotels he surveyed regularly used appraisal,
compared to 62 per cent of similar sized establishments in manufacturing. Woods
et al. (1998) also found a high incidence of appraisal within the US. In a survey of
1000 hotels covering all geographic areas, all types of market segment, ownership
type, size and number of employees Woods et al. found that two-thirds of his sam-
ple had an annual appraisal. Clearly appraisal then is a significant part of broader
HRM concerns in hospitality and tourism and we can now go on to consider some
of the challenges facing managers in operationalizing appraisal schemes.
Appraisal in practice
To begin to assess the impact of performance appraisal we should start with a sim-
ple question: Why should organizations appraise people at work? Arange of writers
(see e.g. Bach, 2005; IRS, 2005a, b) suggest a number of reasons, including:
? Appraisal can be an integral part of ensuring that organizational members are
aware of what is expected of them and can thus play an important part in social-
izing organizational members to ‘ buy in’ to the organizational culture. For
example, Groeschl and Doherty (2002: 58) note how, ‘Its value as an organiza-
tional socialization process is closely associated with organizational attempts
to manage “culture”, another essential element of the HRM approach to the
employment relationship’. Indeed, Bach (2005) notes that increasingly organ-
izations are now using performance management as a means to introduce cul-
tural changes in organizations.
? Improve current performance.
? Provide feedback: We all seek approval and conformation that we are doing the
right thing, and we also like to advise or direct others on how they should do
things.
? Increase motivation.
? Identify training and development needs.
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? Identify potential.
? Let individuals know what is expected of them.
? Focus on career development and succession planning.
? Award salary increases/performance related pay.
? Evaluate the effectiveness of the selection process.
? Solve job problems.
? Set objectives: Using the SMART mnemonic, specific or stretching (define pre-
cisely what is required in clear language), measurable (both quantitatively and
qualitatively), accepted (objectives agreed and not imposed), realistic (achiev-
able and fairly allocated) and time-bound (clear target dates). For example, in a
tourism and hospitality context it might be things like servers trying got
increase their sales per shift, chambermaids cleaning more rooms, receptionists
attempting to become more skilled in information technology, improving com-
munication skills or learning to speak a foreign language.
In reality, in most workplaces staff are being continually monitored and assessed by
management in an informal manner. Indeed, ACAS (2005: 2) suggest that, ‘regular
dialogue between managers and their staff about work performance should, of
course, be encouraged’. That said, the danger with such informality is that it is very
much dependent on individual managers and whether they are giving regular feed-
back. Consequently, ACAS further note that an appraisal system can develop a
greater degree of consistency by ensuring that managers and employees meet for-
mally and regularly to discuss performance and potential. What we are concerned to
examine in this chapter is the formalized manner by which staff are assessed during
performance appraisals. That is, the process of reviewing individual performance
against pre-determined criteria or objectives, involving the gathering of information
and one or more meetings on a quarterly, 6 monthly or annual basis, and producing
some form of report which is likely to include a performance rating. As described
above performance appraisal can be seen in a fairly positive vein and useful in terms
of things like raising morale, clarifying expectations, improving upward and down-
ward communication and so on (and see HRM in practice 8.1).
Review and reflect
What are some of the likely difficulties in appraising employees in tourism and hospitality?
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Despite the above discussion, which points to why performance appraisal might
be thought of as a ‘good’ thing, in reality there is much debate and concern sur-
rounding the notion of appraisal. For example, W. Edwards Deming, a leading
advocate of TQM, has suggested that appraisal is wrong in principle and an inef-
fective management philosophy, describing it as a ‘deadly disease’ (cited in Bach,
2005). Similarly, Stephen Covey, the well-known management guru, has described
appraisal as a ‘disgusting habit’, outmoded and more suited for an industrial age
that no longer exists (cited in IRS, 2005a). Indeed, as long ago as 1957 the famous
management theorist Douglas McGregor, of Theory X and Y fame, was suggesting
that appraisal is the most contentious and least popular part of a manager’s job.
Managers dislike the process as they do not like ‘playing God’, which leads to a
judgemental and ultimately de-motivating approach:
The respect we hold for the inherent value of the individual leaves us dis-
tressed when we must take responsibility for judging the personal worth of
a fellow man. Yet the conventional approach to performance appraisal forces
us, not only to make such judgements and to see them acted upon, but also
to communicate them to those we have judged. Small wonder we resist!
(McGregor, 1957: 90).
HRM in practice 8.1 Appraisal: Some
good news
Research conducted by Armstrong and Baron (2005) on behalf of the Institute of
Personnel and Development in the late 1990s found that employees and managers
offered favourable rather than unfavourable views on appraisal. Some of the comments
from the research included:
‘You need appraisal to get the best out of people and develop them.’
‘In a one-to-one meeting, people can bring things out to their supervisors who say
“I’ve never been aware of that: why didn’t you tell us before?” That’s definitely an
advantage.’
‘For me, the real strength of the process lies in the continuing dialogue and negoti-
ation as the year goes on.’
‘You’re one-to-one with your boss. You’ve chatted, and it wasn’t as if it was your
boss. It was more relaxed. He would listen and then you’d chat about it. I enjoyed it.’
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Managers may also regard appraisal as a waste of time and overly bureaucratic
and may also see it as a process that involves relatively high costs in setting up the
scheme and training employees in using the scheme (and see HRM in practice 8.2).
In part, some of these negative views of appraisal could potentially be
addressed by training for managers to ensure that they are clear of the importance of
appraisal. For example, IRS (2005a: 9) note that, ‘if managers are not properly
trained and committed to the appraisal system, the performance review can become
just a paperwork exercise, at best, or – at worst – a harmful one’. This view points to
the issue of whether appraisals per se are problematic or whether much of the prob-
lem lies in carrying out the appraisal, specifically whether appraisals are performed
poorly by uninterested or badly trained managers. Training, then, may help man-
agers to appreciate the importance of appraisal within a broader performance man-
agement approach and also the need to develop coaching skills to facilitate a more
developmental approach.
Such training may be appropriate in attempting to address some of the problems
which may plague appraisal such as (Bach, 2005; Torrington et al., 2005; IRS, 2005a):
? Prejudice, for example, sex or race discrimination.
? Subjectivity and bias, especially with regard to rater bias.
? Insufficient knowledge of the appraisee – so appraiser position is based on pos-
ition in hierarchy, rather than any real knowledge of person’s job.
? The ‘halo’ and ‘horns’ effect where managers rate employees on the basis of their
personal relationships rather than by objective measure of their competencies and
abilities.
HRM in practice 8.2 Appraisal: Some
common negative managerial thoughts
about appraisal
‘Well, here we go again, I’m sure you don’t like this business any more than I do, so let’s
get on with it.’
‘Now, there’s nothing to worry about. It’s quite painless and could be useful. So just
relax and let me put a few questions to you.’
‘I wonder if I will end up conning you more than you will succeed in conning me.’
‘Right. Let battle commence!’
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? The problem of context – the difficulty of distinguishing the work of appraisees
from the context in which they work, especially when there is a degree of com-
parison with other appraisees.
? What might be termed the ‘paradox of roles’ in terms of the conflation of judge
and counsellor (mentor) role which can lead to confusion. For example, in the
shift from an evaluative to a developmental approach managers have to man-
age such tensions.
? The paperwork – overly bureaucratic and simply about form filling.
? The formality – for both appraiser and appraisee it can be an uncomfortable
experience.
? Outcomes are ignored.
? Everyone is ‘average or just above average’, for example, managers may find it
difficult to give an employee a bad rating as they would not want to justify the
criticisms in the performance review interview.
? Appraising the wrong features – too much stress on easily identifiable things
like timekeeping, looking busy, being pleasant and so on.
? ‘Recency bias’ leading to a tendency to base appraisals on the recent past, regard-
less of how representative it is of performance over the course of the previous
year.
In many respects the above issues reflect what Bach (2005) calls the ‘orthodox cri-
tique’, wherein many of the problems above could potentially be addressed by
seeking to remedy the imperfections in the design and implementation of the
appraisal system or by improving managerial training in conducting appraisals.
For some though there may well be much more fundamental criticisms to be made
about the process of appraisal.
Bach (2005) notes the emergence of more critical accounts of appraisal, in par-
ticular recognizing how, ‘unitary assumptions about the benevolent purposes of
appraisal are replaced by a more radical ideology concerned to examine managerial
objectives, especially tighter control over behaviour and performance, the potential
to individualize the employment relationship and the scope for managers to use
appraisal as a veneer to legitimate informal management’ (p. 305). For example,
many of the criticisms, drawing on the work of Foucault, see appraisal as inherently
sinister and about aiming to control all aspects of employee behaviour and eliminat-
ing scope for employee resistance, so appraisal is simply about bolstering man-
agerial power and control; a point that is similar to some of the criticisms of
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organizational culture outlined in Chapter 3. In sum, Bach suggests that critical
perspectives seek to highlight that it should not be assumed that clearer objectives
and training of appraisers will necessarily yield satisfactory results. Consequently
it is important to recognize how, ‘the contested nature of appraisal, the specific
managerial objectives sought, and the nature of the context in which it is applied,
all have an important bearing on the impact of the appraisal process’ (p. 306).
Thus, we can appreciate that appraisal is very much a contested issue, both con-
ceptually and practically. Equally, though, as Holdsworth (1991: 65) rightly suggests,
‘appraisal is a compulsively fascinating subject, full of paradoxes and love–hate rela-
tionships. And appraisal schemes are really controversial … Some schemes are popu-
lar, with overtones of evangelical fervour, while others are at least equally detested
and derided as the “annual rain dance”, “the end of term report”, etc.’ (and see HRM
in practice 8.3 for how a number of the issues discussed above were played out
within ANO, a French hotel chain, which introduced a new appraisal system).
Ultimately, despite the debates surrounding its utility, appraisal is a fact of
organizational life, and as Bratton and Gold (2003: 252) note, ‘making judgements
about an employee’s contribution, value/worth, capability and potential has to be
considered as a vital relationship with employees’. Moreover, as we noted above
there may be an argument, rather like employment interviewing, to say that the
process in itself is not necessarily flawed, but the individuals operationalizing it
are insufficiently skilled.
Given the reality of performance appraisal being an inevitable part of a manager’s
life we can now look at the practicalities in appraising employees. In appraising
employees a number of writers have outlined two main perspectives the evalu-
ative and the developmental. In the former approach the main aim is to make a
judgement about an appraisees performance, with such a judgement being made
against aspects such as the job description and established objectives, which may
be linked to extrinsic rewards. Often this will also involve managers making rating
or ranking decisions that differentiate between staff on the basis of their relative
Review and reflect
What are some of the skills likely to be required by managers in order to conduct a good
appraisal?
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HRM in practice 8.3 The rhetoric and reality
of appraisal in ANO Hotels
Groeschl and Doherty (2002) report on the introduction of a new appraisal system in
ANO, which is part of a French multinational travel and tourism group and operates at
the three star level. In 1998 a standardized appraisal system was developed for the com-
pany as a whole in order that it could be implemented in all their brands, including ANO.
This attempt at standardizing appraisal was to ensure that all employees across the com-
pany’s various brands would be appraised against the same criteria to ensure a consistent
evaluation of employee performance. The new appraisal system was developed at the
corporate headquarters and the working group which developed the system initially
evaluated the old system to identify weaknesses. Once this was done they then developed
suggestions and proposals for the new system, which were then sent to regional man-
agement teams for their comments and feedback. These exchanges continued for
6 months before finally there was agreement on the standardized criteria and a number
of aims and objectives. A key aim of the new system was to ensure a basis for planning
for action, particularly with regard to career progress. The new appraisal system was an
example of a development-oriented appraisal system and the appraisal format was con-
sidered a formal and sophisticated document. Employees were assessed with ratings
ranging from ‘very good’ to ‘insufficient’ on 13 standardized competencies, including
aptitudes and skills. Although the process of introducing a new appraisal system seemed
well planned and thought out there was still some issues that emerged. For example,
some managers seemed unable to sufficiently differentiate from day-to-day feedback
with the formal appraisal process. Appraisers would also often be inconsistent in their
preparation for appraisal, failing to notify appraisees sufficiently in advance or not filling
in the appraisal form correctly. Appraisers would also often run appraisals in public
spaces, such as bars and restaurants, which runs counter to the advice often offered in
textbooks. Lastly, there was also significant variance in the appraisers style. Some
appraisers recognized the developmental nature of the new system and developed an
advisory/supportive role in the appraisal; whilst others were much more judgemental and
authoritarian. In sum, although ANO had clear objectives, documentation and guide-
lines, all of which reflected good practice HRM, the implementation proved rather trick-
ier. Closer monitoring of the process by the HR managers, or line managers with a strong
interest/involvement in HRM could have improved the situation. Equally, the case seems
to point to the need to provide managers with the appropriate skills which allows them
to take on more of a facilitator or coaching role in the appraisal process.
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performance. On other hand, developmental approaches are likely to have a differ-
ent premise, where the appraiser and appraisee aim to discuss the progress, hopes
and fears of the appraisee in a mutually supportive atmosphere and where the
ultimate aim is on developing performance by building on employees strengths
(and see HRM in practice 8.4).
In reality, within any given organizational setting there may not be such an
absolute and clear cut distinction and their may be elements of both evaluative
and developmental approaches, such that the purpose of performance appraisal
has tended to oscillate between concerns about short-term performance to a more
developmental orientation. Appraisal has also been used as a disciplinary tool by
some organizations, with poor performance being something that appraisals sys-
tems have sought to address, a point to which we will return later. As we have
already noted above though the character and emphasis of appraisal has increas-
ingly changed in recent years. For example, Bach (2005: 291) notes how:
During the 1990s there was a shift from almost exclusive emphasis on reward
driven systems, based on individual performance related pay and quantifi-
able objectives, towards more rounded systems of performance management
with a stronger developmental focus.
HRM in practice 8.4 Appraisal talking
points: Evaluating or developing?
As we have already noted there may be some debate as to whether performance reviews
of appraisals should be evaluative or developmental. Consider how you would respond
to the talking points below in assessing this conundrum.
Talking point 1
As part of an appraisal process you want to tell a member of staff in your travel agency
that you feel as though they lack initiative and that this is severely hindering their per-
formance in their front-line job. How do you approach this issue?
Talking point 2
Should appraisal be linked to pay?
Talking point 3
Should appraisal look forwards or backwards?
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We will consider this point in due course. However, it is important to recognize
that many appraisal systems will still retain attempts to measure performance,
often using a variety of techniques. For example, Woods et al. (1998) found that
hotels in their survey used one or more of four approaches, these being manage-
ment by objective (MBO) (48 per cent), behaviourally anchored rating scales (BARS)
(41 per cent), narrative essay (37 per cent) and graphic rating scale (28 per cent).
Other methods which organizations may use include performance standards and
matching performance against job descriptions, rating an employee based on a scale,
which may for example range from ‘outstanding’ to ‘unacceptable’ and critical
incidents (and see also HRM in practice 8.5).
HRM in practice 8.5 gives an indication of the types of activities which may be
assessed in judging the performance for managers in the tourism and hospitality
industry. Clearly, in addition to these aspects there may be a range of other attrib-
utes that can be used to measure the individual performance of an employee. For
example, CIPD (2005b) reporting on a survey of over 500 organizations across the
HRM in practice 8.5 The use of BARS in the
American hotel industry
BARS aims to evaluate managers’ actions. Umbreit et al. (1986) developed a BARS format
to evaluate what hotel managers do in their jobs using seven rating scales for a number
of key aspects of job performance. The aspects of job performance were: communica-
tion skills, handling guest complaints and promoting guest relations, developing market-
ing strategies and monitoring sales programmes, motivating and modifying employee
behaviour, implementing policy, making decisions, and delegating responsibilities, moni-
toring operations and maintaining product quality and handling personnel responsibil-
ities. For example, with regard to communication skills, at the top of the scale at 7 is a
manager who communicates effectively by for example calling a meeting to explain why
the hotel will be cutting staff. In the middle is a manager who communicates satisfactor-
ily between 4 and 5, for example, a manager who meets with several employees once a
week for an informal talk about the hotel’s activities. Lastly, at the bottom is a manager
who experiences difficulties in communicating with staff at 1–2, for example, during an
executive meeting a manager who dismisses a subordinates comments as stupid.
Source: Woods et al. (1998).
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economy outline a number of criteria and their relative importance to how organ-
izations measure individual performance, and these are considered in Table 8.2.
Similarly, IDS (1989, cited in McKenna and Beech, 2002) suggest a number of
performance factors which are likely to be appraised, the most important being:
? Knowledge, ability and skill on the job.
? Attitude to work, expressed as enthusiasm, commitment and motivation.
? Quality of work on a consistent basis and attention to detail.
? Volume of productive output.
? Interaction, as exemplified in communication skills and ability to relate to
others in teams.
As we noted above though the focus of appraisal is increasingly argued to be shifting
to one of a more developmental focus. Given that much of the discussion above has
outlined an approach to appraisal which is predominately top-down, there may be
Table 8.2 Criteria used to measure individual performance
Respondents (%)
Very Important Not very Not used as a
important important measure
Customer care 45 40 7 5
Quality 47 44 3 4
Flexibility 22 56 13 4
Competence 53 40 3 2
Skills/learning targets 18 57 16 4
Business awareness 17 52 21 6
Working relationships 35 53 7 3
Contribution to team 34 57 4 2
Financial awareness 11 47 28 10
Productivity 34 49 9 6
Aligning personal 29 48 16 4
objectives with
organizational goals
Achievement of objectives 52 42 3 1
Source: This material is taken from Performance Management Survey Report by CIPD (2005), with the
permission of the publisher, the Chartered Institute of Personnel and Development, London.
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other approaches, which may be seen as less biased and potentially offering greater
scope for development. Some of these other approaches are now briefly discussed.
Self-appraisal: Bach (2005) notes the manner in which the appraisal process in a
number of organizations increasingly expects employees to take greater owner-
ship, ‘with employees assigned greater responsibility for establishing their own
performance goals and for obtaining feedback on their performance’ (p. 293). With
self-appraisal, then, instead of employees’ being passive recipients of their line
manager’s appraisal they are increasingly involved via some form of self-assessment,
often being more critical than if the manager conducted the appraisal (McKenna
and Beech, 2002). In such an approach employees are increasingly expected to take
the lead in the discussions – it should not just be a case of downwards feedback
from the line manager. Indeed, in some instances employees may draft their own
performance reviews, which then forms the basis for the discussion with their line
manager (IDS, 2005).
Peer appraisal: Fellow team members, departmental colleagues or selected indi-
viduals with whom an individual has been working provide the assessment of
performance.
Upward appraisal: Managers are appraised by their staff (and see the discussion
of attitude surveys in Chapter 10).
Customer appraisal: Redman (2006) notes the increasing importance of customers
in the appraisal process, which in part reflects the emergence and development of
TQM and customer care programmes. As he recognizes, ‘one impact of these initia-
tives is that organizations are now increasingly setting employee performance stand-
ards based upon customer care indicators and appraising staff against these’ (p. 163).
For example, Redman notes how these can be both in terms of ‘hard’ quantifiable
measures, such as whether a drink is delivered in a certain amount of time in a
restaurant; to ‘soft’ measures, which are more qualitative, such as whether a warm
and friendly greeting is given by staff in giving the customer the drink. Moreover,
Redman notes the use of service guarantees, ‘which involve the payment of com-
pensatory moneys to customers if the organizations do not reach the standards’
(p. 163), which again also means a greater use of customer data in appraisal ratings.
In terms of the use of customer service data and how it may be used to appraise
employees, Redman notes how it can be gathered by a variety of means.
? Customer surveys: Organizations are now becoming increasingly sophisticated
in the manner in which they gather customer feedback, which is gathered via a
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number of means such as the use of customer care cards, telephone surveys,
interviews with customers and postal surveys.
? Range of surveillance techniques: Managers may ‘sample’ the service encounter.
For example, if a travel company had a call centre managers could listen to
some of the calls between customers and the call centre operatives.
? ‘Mystery’ or ‘phantom’ shopper: Mystery shoppers observe and record their experi-
ence of the service encounter and report these findings back to the organization.
Although this method may be seen as rather controversial – employees may
view the mystery shoppers as ‘spies’ or ‘snoopers’ and indulge in ‘shopper
spotting’ – it is widely used in the tourism and hospitality industry. Redman
argues that the controversy surrounding mystery shoppers may be dissipated
to an extent if they are used primarily for encouraging and rewarding good per-
formance, rather than punishing staff for performing poorly.
Customer feedback may be used as a stand-alone aspect of performance manage-
ment, or may be an integral part of 360-degree feedback.
Multi-rater or 360-degree feedback: CIPD (2006) notes how 360-degree feedback has
been increasingly talked about, if not necessarily widely used. Performance data is
generated from a variety of sources, which can include the person to whom the indi-
vidual being assessed reports, people who report to them, peers (team colleagues or
others in the organization), and internal and external customers. It may also include
self-assessment and will often be part of a self-development or management devel-
opment programme. 360-degree feedback is felt to provide a more rounded view of
people, with less bias than if an assessment is conducted by one individual.
The practicalities: the appraisal form and interview
Most PMS are likely to have a formal final performance review, where an individ-
ual employee is assessed against their objectives (inputs and outputs). This review
Review and reflect
If you have been subject to any of the above aspects in your working life in tourism and
hospitality how did you feel about being assessed by these means? Did you feel that it
gave a fair representation of your performance?
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is also likely to allow for a review of training and development needs. With regard
to the practicalities of conducting the review, it is likely that most companies will
use the appraisal form to structure the discussion. ACAS (2005) notes how most
performance appraisal forms should contain provision for:
? basic personal details, such as name, department, post, length of time in the job;
? job title;
? job description;
? a detailed review of the individual’s performance against a set of job related
criteria;
? an overall performance rating;
? general comments by a more senior manager;
? comments by the employee;
? a plan for development and action.
In approaching the appraisal interview the discussion to date gives a sense of
some of the potential pitfalls that might befall a manager in conducting an
appraisal interview. To an extent as well the nature and tone of the appraisal inter-
view will be dictated by whether a scheme is seeking a broadly evaluative
or developmental approach. That said, Torrington et al. (2005) in their review of
appraisal interviewing advocate the need to seek an approach which is con-
cerned with seeking joint approaches to enhance performance. Underpinning
such an approach is a problem-solving style, which is summarized in the follow-
ing manner:
The appraiser starts the interview by encouraging the employee to identify
and discuss problem areas and then consider solutions. The employee there-
fore plays an active part in analysing problems and suggesting solutions, and
the evaluation of performance emerges from the discussion at the appraisal
interview, instead of being imposed by the appraiser upon the employee
(Anderson, 1993: 102, cited in Torrington et al., 2005: 341).
Much of the above discussion points to the need for managers to have the right
skillset that allows them to appraise well; as well as understanding how appraisal
fits in to the wider issue of performance management and organizational strategy
generally. In terms of practical skills though there may be aspects such as asking
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the right questions, the ability to be a good listener and giving useful feedback. In
sum, CIPD (2005a: 4) offers a view on what ‘good’ and ‘bad’ appraisals look like:
On the one hand a ‘good’ and constructive appraisal meeting is one in which:
? Appraisees do most the talking.
? Appraisers listen actively to what they say.
? There is scope for reflection and analysis.
? Performance is analysed and not personality.
? The whole period is reviewed and not just recent or isolated events.
? Achievement is recognized and reinforced.
? Ends positively with agreed action plans.
On the other hand a ‘bad’ appraisal meeting:
? Focuses on a catalogue of failures and omissions.
? Is controlled by the appraiser.
? Ends with disagreement between appraiser and appraisee.
Managing poor performance
Of course there is always the potential issue of how to manage poor performers and
a clear rationale for the introduction of PMS is to seek to identify and address any
instances of poor performance. If a PMS is underpinned by regular meetings, feed-
back and coaching then these issues should be picked up relatively quickly.
Organizations can then attempt to address poor performance through some form of
improvement development programme, which will often involve employees being
given extensive help in the form of training and coaching. Armstrong (2001: 484–485)
suggests that there are five basic steps in handling performance problems:
1 Identify and agree the problem through analysing feedback and getting agree-
ment from the employee what the shortfall has been.
2 Establish the reason(s) for the shortfall and avoid crudely attaching blame for
problems in the job.
3 Decide and agree on the action required, whether it be things like a change in
attitude, behaviour or improvements in certain skills or abilities.
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4 Resource the action by providing coaching, training and guidance to ensure that
changes can be made.
5 Monitor and provide feedback, which may also include an element of self-
management in the learning process.
Thus, as IDS (2005: 9) notes, ‘in this way, most poor performers will either improve to
a satisfactory level within a given timescale or as a last resort would be liable for dis-
missal under capability procedures’, an issue that is further discussed in Chapter 12.
Conclusion
Despite concerns performance appraisal remains a key part of organizational life.
Often an integral part of a broader PMS performance appraisals are a crucial, if rather
unloved, part of a manager’s job. We recognized in the chapter how debates about
performance appraisal may not just reflect fundamental criticisms but also more pro-
saic issues, such as managers not having the necessary skillset to conduct appraisals
which are more developmentally oriented in particular. Many of these issues are par-
ticularly pronounced in the tourism and hospitality sector where the predominance
of SMEs, the nature of the skills mix in the industry and difficulties in judging ‘softer’
and less quantifiable aspects of performance may all mean that the development of a
systematic approach to appraisal remains problematic. Nevertheless evidence sug-
gests that the majority of tourism and hospitality organizations are seeking to
appraise their employees. Given this reality it is important for organizations and
managers to recognize the challenges in conducting positive appraisals. Recognition
of these challenges and the skills needed to address them means that ‘playing God’
may not be quite so painful for managers as has often been the case in the past.
References and further reading
Advisory, Conciliation and Arbitration Service (2005) Employee Appraisal, ACAS.
Armstrong, M. (2001) A Handbook of Human Resource Management Practice, Kogan Page, 8th edition.
Armstrong, M. and Baron, A. (2005) Managing Performance: Performance Management in Action, CIPD.
Bach, S. (2005) ‘New directions in performance management’, in S. Bach (ed.) Managing Human
Resources: Personnel Management in Transition, Blackwell, 4th edition, 289–316.
Bratton, J. and Gold, J. (2003) Human Resource Management – Theory and Practice, Palgrave, 3rd edition.
Chartered Institute of Personnel and Development (2005a) Performance Appraisal Factsheet, CIPD.
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Chartered Institute of Personnel and Development (2005b) Performance Management Survey Report,
CIPD.
Chartered Institute of Personnel and Development (2006) Performance Management Factsheet, CIPD.
Goldsmith, A., Nickson, D., Sloan, D. and Wood, R. (1997) Human Resources Management for Hospitality
Services, International Thomson Business Press.
Groeschl, S. and Doherty, L. (2002) ‘The appraisal process: beneath the surface’, Journal of Human
Resources in Hospitality and Tourism, 1(3), 57–76.
Heery, E. and Noon, M. (2001) A Dictionary of Human Resource Management, Oxford University Press.
Holdsworth, R. (1991) ‘Appraisal’ in F. Neale (ed.) The Handbook of Performance Management, IPM,
64–81.
Hoque, K. (1999) ‘New approaches to HRM in the UK hotel industry’, Human Resource Management
Journal, 9(2), 64–76.
Income Data Services (2005) Performance Management, IDS Studies, No. 796, April.
Industrial Relations Services (1999) ‘New ways to perform appraisals’, IRS Employment Review,
No. 676, March, 7–16.
Industrial Relations Services (2005a) ‘Appraisals (1): not living up to expectations’, IRS Employment Review,
No. 828, 29 July, 9–15.
Industrial Relations Services (2005b) ‘Appraisals (2): learning from practice and experience’, IRS
Employment Review, No. 829, 12 August, 13–17.
Labour Research Department (1997) Performance Appraisal, LRD.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
McGregor, D. (1957) ‘An uneasy look at performance appraisal’, Harvard Business Review, 35(3), 89–94.
McKenna, E. and Beech, N. (2002) Human Resource Management: A Concise Analysis, Pearson Education
Limited.
Redman, T. (2006) ‘Performance appraisal’, in T. Redman and A. Wilkinson (eds.) Contemporary Human
Resource Management: Texts and Cases, Prentice Hall, 2nd edition, 153–187.
Torrington, D., Hall, L. and Taylor, S. (2005) Human Resource Management, Prentice-Hall, 6th edition.
Umbreit, T., Eder, R. and McConnell, J. (1986) ‘Performance appraisals: making them fair and making them
work’, Cornell Hotel and Restaurant Administration Quarterly, 26, 4, 59–69.
Woods, R., Sciarini, M. and Breiter, D. (1998) ‘Performance appraisal in hotels’, Cornell Hotel and
Restaurant Administration Quarterly, 39(2), 25–29.
Websites
Workforce Management has a description of a 360-degree appraisal process in Yum Brands Inc (Workforce
Management, April 2005, pp. 59–60). This article can be found at http://www.workforce.com/index.html
at the main site use the free registration facility then find the article via the search facility.
The CIPD Performance Management survey can be found at http://www. cipd.co.uk/surveys
There are a number of helpful tips and tools to improve appraisal at http://www.businessballs.com/perfor-
manceappraisals.htm
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Chapter 9
Reward strategies in
the tourism and
hospitality industry
Chapter objectives
This chapter considers reward strategies in the
tourism and hospitality industry. Specifically this
chapter will:
? Review differing employer and employee
objectives with regard to pay.
? Consider debates about minimum and
maximum wages and comparability of pay
across tourism and hospitality sub-sectors and
occupations.
? Recognize the importance of tipping as part of
the reward package in tourism and hospitality.
? Discuss the variety of additional non-monetary
rewards available to tourism and hospitality
employers.
188
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Introduction
The first problem we face when thinking about the notion of reward strategies is a ter-
minological one. When we talk about rewards we are likely to hear a variety of terms.
For example, Foot and Hook (2005) note a number of commonly used terms used to
describe payment systems, including ‘compensation’, ‘remuneration’, ‘reward’, ‘pay-
ment’, ‘wages’ and ‘salaries’. Increasingly in a prescriptive HRM sense there is much
talk of ‘total remuneration planning’, ‘reward management’ or ‘reward strategy’ as
denoting a more strategic and holistic approach to the rewarding of employees.
Therefore in this more prescriptive view it is argued that employees seek a range of
monetary and non-monetary rewards – the so-called ‘cafeteria approach’ – from
employment of which money is only one aspect, even if it is often the primary con-
sideration for employees. Thus, employees may seek both extrinsic and intrinsic and
financial and non-financial rewards at work. That said, a more realistic assessment is
that in reality the provision of extrinsic rewards is certainly the most substantive issue
in the effort–reward bargain and often the most problematic aspect of employment.
Therefore this chapter will focus on the notion of extrinsic rewards and in particular
pay as it will often be the main reason why people work. In considering pay and
other aspects of remuneration, this chapter will also recognize how the nature of
tourism and hospitality as an employing sector will significantly impact on the devel-
opment of reward strategies. For example, the existence of a relatively large number
of unskilled and semi-skilled employees means low pay is endemic in many parts of
the tourism and hospitality sector, particularly the sub-sector of hotel and catering.
Employee and employer views of pay
Torrington et al. (2005) recognize how, ‘the contract for payment will be satisfac-
tory in so far as it meets the objectives of the parties’ (p. 569). In recognizing this
point we can now consider how these objectives are likely to differ depending on
whether it is employees or employers.
Employee objectives for the contract for payment
Purchasing power
The absolute level of weekly or monthly earnings will determine the standard of
living of individual employees, so they will aim to maximize their purchasing
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power. In simple terms, employees will ask themselves how much they can buy
with their earnings. Torrington et al. suggest that employees will rarely be truly
satisfied about their purchasing power. Indeed, it could be argued that purchasing
power has become ever more resonant in an era of conspicuous consumption in
which marketing and advertizing portray a wide array of goods or services which
people should be aspiring to consume.
Felt to be fair
In many respects the notion of felt to be fair is captured in the idiom of ‘a fair’s day
pay for a fair day’s work’. In this sense employees tend to have a strong sense of
what they feel is an appropriate level of payment which is fair to the job they are
doing. As Torrington et al. note the employees who feel underpaid are likely to
withdraw from the job and are more likely to be absent or late, for example. This
situation can be exacerbated if an employee has no real choice in terms of poten-
tially moving elsewhere. Of course employees may not simply feel underpaid,
there may be some instances were employees actually feel they are overpaid.
In such instances employees may feel guilty or attempt to look busy, which from
an organizational point of view may not necessarily be particularly productive.
Rights
Here Torrington et al. recognize the fundamental issue of the rights of employees
to a particular share of a company’s profit or the nation’s wealth. Clearly, the man-
ner in which wealth is currently shared out is one which engenders much debate
and many employees might feel that they are not getting a reasonable or fair share
of the wealth that is created. This general sense of unease will often be expressed
by trade unions in particular, who will seek to create a more fair division of wealth
based often on notions of social and economic justice.
Relativities
Torrington et al. note that a question often asked by employees is ‘how much do I
(or we) get relative to … group X?’ (p. 597). In that sense the notion of relativities
is similar to the issues considered in the discussion of felt to be fair. Here though
the employee will not ask whether remuneration is fair to the job done, but instead
whether it is reasonable compared to jobs done by other people. Comparison may
take place at a number of levels from the immediacy of the person sitting at the
next desk to other companies or other professional or occupational groups. Much
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of this comparison may not be based on an entirely objective view. For example, in
comparing one job with another there may be significantly more responsibility in
a job that perhaps shares a similar title or job description.
Notions of felt fair, rights and relativities are particularly important and will
often lie at the heart of much of the debate and controversy which is generated about
pay and especially whether people are being ‘fairly’ paid (see HRM in practice 9.1).
Recognition
Torrington et al. note how most employees want to see their personal contribution
recognized either to be reassured of their worth or to facilitate career progression.
Part of this recognition may well be financial recognition, though in reality there
may be other aspects as well as the financial in recognizing and improving
performance.
Composition
Composition refers to the issue of how a pay package is made up and how this may
vary between individual employees, depending on things like age or sex. For
example, younger employees may be much more concerned with high direct earn-
ings at the expense of indirect benefits such as pensions, which are likely to be of
more interest to older employees. Other issues surrounding the composition of pay
packages include aspects such as overtime and incentive or performance-related pay.
Employer objectives for the contract of payment
Prestige
As Torrington et al. note, ‘there is a comfortable and understandable conviction
among managers that it is “a good thing” to be a good payer’ (p. 598). Clearly part
of the reason for being a good payer is to attract the best labour which is available
to an organization. Torrington et al. warn that being a good payer does not
axiomatically bestow a reputation as a good employer. That said, they also suggest
Review and reflect
Are the chief executives described in HRM in practice 9.1 ‘greedy bastards’, as John
Edmonds suggests, or fairly remunerated?
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HRM in practice 9.1 The disparities between
those who have and those who do not have
in tourism and hospitality
Much of the debate about disparities in pay focuses on notions of fairness and equity and
the difference between those at the top and bottom of the earnings ladder. Indeed, the
issue of pay inequality has often been at the forefront of trade union campaigns to increase
wages for those lower down the organizational hierarchy. For example, John Edmonds,
then general secretary of the GMB union, once famously railed against private sector
bosses who awarded themselves inflated pay increases describing them as ‘greedy bas-
tards’ (Milne and White, 1998) who were indulging in the ‘politics of the pig trough’
(Milne, 1998). Certainly this debate has some resonance for tourism and hospitality and
over the years there has been plenty of evidence to suggest that there is a significant pay
gap between those who have and those who do not have in tourism and hospitality.
Travel and Leisure Industry Salary Survey 1997 found that the highest paid directors
at the UK’s top 12 tourism and hospitality companies earned an average of £478 500,
compared to a staff average of £11 360. Some of the so-called ‘fat cats’ were:
Peter George – Ladbroke chief executive £1 280 000
Gerry Robinson – Granada chairman £728000 (though in December 1999 by cashing
in share options he made a pre-tax profit of £5.26 million)
Sir Ian Prosser – Bass chairman £678 000
Caterer and Hotelkeeper (23 December 1999) reported that chief executives in the
hospitality industry received an average pay increase of 20.8 per cent, compared to
3.5 per cent for employees.
Caterer and Hotelkeeper (18 May 2000) reported how David Thomas, Chief
Executive of Whitbread, saw his total salary raised by 25.8 per cent, while group profits
dropped by 14.8 per cent. His overall earnings were £593 103. The same article also
reports how the average basic salary of 20 selected chief executives in the hospitality and
leisure sectors was £330 835, which with bonuses and benefits rose to £370 293.
Leisure and Hospitality Business (25 July 2002) reported the highest paid chief execu-
tives packages for 2001/2002. The highest earner was Tom Oliver, Director of Six Continents
Hotels and Resorts, who had a basic salary of £527000, bonuses of £533000 and benefits
of £207000, giving him an overall package of £1267000. The lowest paid director was Paul
Dermody of the De Vere Group. His basic salary was £231000, his bonus was £50000 and
his benefits £13000, giving him a total salary of £294000.
IRS Employment Review (19 May 2006) report a survey of salaries in the leisure indus-
try. Amongst other things it notes that the average employee in the industry earns £18602
a year, just 4.4 per cent of the average £501613 paid to chief executives.
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that being seen as a low-paying employer will mean an organization has a reputa-
tion as being a poor employer.
Competition
Here a key issue is the need to pay rates that are sufficiently competitive to sustain
the employment of the right number of appropriately qualified and skilled
employees for the organization’s needs. Unlike prestige the key aspect in consider-
ing competition is the need for a good fit to ensure for example that employers are
not over paying employees.
Clearly an important part of prestige and competition is the manner in which
the organization is interacting with the external labour market and ensuring
that they are getting the right kind of labour at the right kind of price (see HRM
in practice 9.2 and 9.3).
Control
Torrington et al. note the manner in which organizations have to consider control-
ling pay and particularly the extent to which money may be saved, though
changes with regard to legislation in areas such as redundancy mean that such
measures are less apparent in organizations.
Motivation and performance
At one level there is a simple issue facing organizations in terms of their ability to
use payment to motivate employees to perform well. In reality though there may be
a number of means to achieve this. For example, the use of performance-related pay.
HRM in practice 9.2 The NMW in the
leisure industry
IDS (2004) note that in the past many companies in the leisure sector have preferred to
keep their rates well ahead of the NMW. However, more recently the level at which the
NMW has been uprated has meant that some leisure employers have found it more diffi-
cult to be a higher paying employer. In the past by paying above the NMW some leisure
employers were seen as ‘good’ employers, especially given the large number of unskilled
jobs in the sector. As one company is quoted as saying, ‘Now when we are asked what we
pay, we have to say “minimum wage” which puts a real stigma on both the job and the
staff who do these jobs’.
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Cost
Torrington et al. note how just as employees are concerned with their purchasing
power, so employers are interested in the absolute cost of payment. In particular,
organizations will be concerned of the impact on labour costs on profitability or
cost effectiveness. This issue has a particular resonance in tourism and hospitality
due to its labour intensive nature, meaning that the proportion of labour costs is
higher than most other industries.
Change management
Pay may be used as part of a broader change management process. For example,
there may be additional bonuses available for employees willing to develop new
HRM in practice 9.3 Challenging perceptions
of ‘McJob’
McDonald’s has often been at the forefront of arguments that suggest that work in tourism
and hospitality is inherently low paid and with little meaning. For example, Douglas
Coupland, the author of Generation X: Tales for an Accelerated Generation, coined the
term McJob to describe a low-paying, low-prestige, low-dignity, low-benefit job, no-future
job in the service sector. Recently the company has sought to address these issues head-on
with a sustained campaign to change perceptions about the McJob descriptor. A key part
of this re-branding has been attempts to draw attention to fairness with regard to career
opportunities and remuneration. For example, the company has suggested that the pro-
portion of employees who regard their pay as ‘fair’ is 30 per cent higher than comparable
companies. Part of the reason for this finding may be the manner in which McDonald’s pay
well above the lowest rate of the NMW for 16–17-year olds. The company has a lowest
rate of £4 per hour for this group of employees, a full pound above the state’s 16–17-year-
old development rate. Of course, McDonald’s have a relatively large number of employees
who will be in the 16–17 age bracket and so arguably could be seen to be a ‘good’
employer to that particular segment of the labour market. Interestingly this is in contrast to
the rate for 18–21-year olds and those aged 22 years, where the lowest rate is at the level
of the NMW, although with increments staff can eventually earn a top hourly rate of £8.70.
Derived from Anon (2006); Overell (2006).
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behaviour, attitudes or skills, which are required as part of a cultural change
process.
In sum, employers will be seeking an approach to reward management which
is likely to have several principal objectives, including:
? Attract and retain suitable employees.
? Maintain or improve levels of employee performance.
? Comply with employment legislation.
Clearly, the approach that an organization develops towards reward strategies
does not exist in isolation and there will be a number of other influences on pay
determination that will affect such considerations, including:
? Beliefs about the worth of the job – for example, the size, responsibility, skill require-
ments and ‘objectionableness’ of duties.
? Individual characteristics –- for example, age, experience, seniority, general quali-
fications, special skills, contribution, performance and potential.
? Labour market – the level and composition of any given reward package will be
influenced by labour supply and demand at either national or local labour mar-
ket level, and whether an organization is seeking to create a strong internal
labour market.
? Strength of bargaining groups – for example, the potential for trade unions to
influence pay determination. At any given time the relative strength of trade
unions will be influenced by other external economic factors, such as the level
of unemployment and feelings of job security.
? Government intervention and regulatory pressures – for example public sector pol-
icy and other policy initiatives. Most obviously, the statutory national min-
imum wage (NMW), but also in terms of public policy towards aspects such as
trade unions and collective bargaining.
There are a wide range of things then which can conceivably influence and shape
the rewards that employees may get and the ‘market rate’ for a particular sector or
occupation. Let us now begin to develop this framework within the context of
tourism and hospitality.
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Remuneration in tourism and hospitality
Generally when we are talking about remuneration in the tourism and hospitality
industry, we can start with the fairly negative observation that relative to other
industries the majority of jobs and occupations within the sector are poorly remu-
nerated (Lucas, 2004; Baum, 2006). When we recognize that often there is low sta-
tus ascribed to the industry the perception held by a number of people is that for
many tourism and hospitality is an employer of last resort, with mundane,
degrading employment. The prevalence of low pay and perceptions about low sta-
tus can be seen as being two key issues which continue to sustain the negative
view held by many of tourism and hospitality work (Lindsay and McQuaid, 2004).
To begin to examine remuneration in tourism and hospitality in detail we should
begin by recognizing the work of Mars and Mitchell (1976) and their notion of the
‘total rewards system’. The ‘total rewards system’ has several aspects, which are:
basic pay and subsidized food and lodging, which can be considered as the ‘for-
malized’ aspect of the wage–effort bargain; and other aspects which can be con-
sidered as more informal rewards, these being tips, which are semi-formalized,
and ‘fiddles and knock offs’, which are non-formalized. In reality, it is apparent
that the notion of a ‘total rewards system’ is in fact a misnomer and there are a
variety of other aspects in terms of a range of benefits that may be used by tourism
and hospitality organizations to make up a reward package, a point which we will
further consider later in this chapter. Nevertheless, at least initially the notion of
the total rewards system provides a useful starting point to consider some funda-
mental issues and concerns in understanding reward practices in the tourism and
hospitality industry, particularly with regard to basic pay and tipping.
Basic or base pay
In a general sense Torrington et al. (2005) note that there are a number of
approaches to the setting of base pay rates. Here, of course as we noted earlier in
this chapter managerial actions may be constrained by the manner in which the
state influences pay determination, most obviously with the provision of min-
imum wage legislation. In addition to this aspect though Torrington et al. also note
the importance of external market comparisons and for example whether employ-
ers will pay at or above ‘the going rate’ for a particular job. There are also internal
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labour market mechanisms in which the skills and experience of employees will
have a bearing on their pay. Afurther mechanism to determine pay is job evaluation,
which is a systematic attempt to aid the establishment of differentials across jobs
within a single employer. As a consequence the organization’s wage budget is
divided among employees on the basis of assessing the nature and size of the job
they do. The last mechanism identified by Torrington et al. is that of collective bar-
gaining, where pay rates are determined through collective negotiations with trade
unions or other employee representatives. As will be discussed in the following
chapter though, trade union representation has always been very low in the tourism
and hospitality sector and collective bargaining has tended to play little influence in
pay determination in the sector. Instead, determination of pay in tourism and hospi-
tality has traditionally been a matter of managerial prerogative (Lucas, 2004).
In considering pay in tourism and hospitality the first point which is worth
noting is the enduring and prevailing existence of low pay in the sector. For example,
Wood (1997a: 69) notes how, ‘the majority of academic evidence concurs in sug-
gesting both that basic rates of pay in hotels and catering are inadequate and
employers are frequently ruthless in pursuing low-pay strategies’. Thus tourism
and hospitality, and particularly the hotel and catering sub-sector, is low paid,
both in absolute terms (i.e. purchasing power) and relative terms (compared to
most other workers) (see also HRM in practice 9.4).
Whilst the hotel and catering sub-sector is clearly low paid, the picture in
other areas of the tourism sector may be more mixed. On the one hand, Baum
(2006) notes how other sub-sectors such as travel agencies, airlines and tour oper-
ators, who are often staffed by young and female employees, also offer relatively
poor remuneration. Often this will mean that for a number of front-line positions,
such as travel advisors, the pay rate will be at or near the NMW. For example,
MyTravel, a major provider of package holidays and other leisure travel services,
offers a salary range for a travel advisor of £9000–£11500 (http://www.mytravel-
careers.co.uk/retail/accessed 15 May 2006). On the other hand, a recent survey
conducted by Croner in conjunction with the Association of British Travel Agents
(ABTA) suggests that the median basic salary for workers in the travel industry
was £21753, which rose to £23135 when other aspects such as commission and
bonuses were added (IRS, 2006b). These figures are clearly significantly higher
than the figures for the hotel and catering industry noted in HRM in practice 9.4.
Moreover, whilst relatively low pay may be true for a number of front-line posi-
tions in tourism and hospitality it is a different picture for other occupational
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groups. For example, IRS (2006c) note that in First Choice Airways’ a first officer
can expect to start work with the company at a basic salary of £31011, with a cap-
tain’s salary ranging from £67576 to £94113. Generally though, as with the hospital-
ity sub-sector, the bulk of employees within tourism-related occupations are likely
to be relatively low paid (Baum, 2006). To an extent though Baum also recognizes
that within a number of tourism jobs aspects such as travel opportunities, uniforms
HRM in practice 9.4 Condemned to low pay?
A history of low pay in the hospitality
industry
1975 – The Hotel and Catering Economic Committee suggested on the basis of low pay
of 60 pence an hour for men and 55 pence an hour for women, 49 per cent of full-time
men and 88 per cent of full-time women in hotels and catering were low paid, compared
to 11 per cent and 53 per cent in ‘all industries’ across the economy.
1986 – Byrne estimated that between 57 and 64 per cent of full-time workers in hotel
and catering employment were low paid (i.e. defined as earning less than two-thirds of
male median earnings).
1989 – A British Hotels, Restaurants and Caterers Association survey revealed catering
managers earned 27 per cent less than average non-manual workers and non-manual
employees earned 28 per cent less than the average for manual workers.
1999 – The Office of National Statistics New Earnings Survey 1999 found that waiters/
waitresses (average gross annual salary £8879), along with kitchen porters and kitchen
hands (average weekly wage £180.50) were the lowest paid of all UK employees (the
average yearly pay across all occupations was £20 919).
2003 – The Office of National Statistics New Earnings Survey 2003 found that hotel and
restaurant employees were the lowest paid in the country. Average gross annual pay for
full time restaurant and hotel employees was just £16 533, compared to a UK average of
£25 170.
2005 – The Office of National Statistics Annual Survey of Hours and Earnings 2005 found
that hotels and restaurants had the lowest median gross annual earnings at £14 653. The
highest paying sector was financial intermediation at £29 962. The median for all indus-
tries and services was £22 903.
Derived from Wood (1997a); Bozec (1999); Anon (2003); IRS (2006a).
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and a generally pleasant working environment may encourage something of a
trade-off between a desire for higher levels of pay and less acceptable conditions
or other benefits (see HRM in practice 9.5).
Wage regulation in tourism and hospitality
Although we noted above that pay determination has largely been dictated by the
managerial prerogative in more recent times the introduction of the NMW has intro-
duced greater regulation by statutory means. The NMW marks a significant change
in the British employment landscape and will be discussed in due course. To place
the emergence of the NMW in context though it is worth briefly mentioning wages
councils, which had previously played a role in setting a de-facto minimum wage.
For a large number of those working in tourism and hospitality, and particularly
hotel and catering, the wages councils provided a minimum safety net with regard
to wages for nearly 50 years. First introduced in 1909 as trade boards, and first cov-
ering the hospitality sector from the mid-1940s, wages councils peaked in the 1950s
covering over 3.5 million workers, providing surrogate collective bargaining for the
low paid (Metcalfe, 1999). At the time of their abolition in 1993 there were three
wages councils that covered different sub-sectors of the commercial hospitality
industry and the mean hourly rate they set was £2.97 per hour which was £115.96 for
a 39-hour week or £6029.92 per annum (Goldsmith et al., 1997). From 1993 to the
introduction of the NMW in 1999 there was no real protection for employees and
evidence suggests that a number of employers took advantage of this omission in an
attempt to drive down wages (Lucas and Radiven, 1998; Lucas, 2004).
HRM in practice 9.5 Work as leisure
Guerrier and Adib (2004) conducted research by interviewing and observing 14 overseas
tour reps in Mallorca. They found that for this group of employees there will often be a
blurring between work and leisure, which may allow the worker to enjoy some of the
benefits of leisure at work. As an example overseas tour reps may not distinguish
between their work and non-work lives. Customers may be their friends, their workplace
is where they would ‘hang out’ anyway and their work does not demand a subordination
of self but only a presentation of their authentic, fun loving and sociable self.
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The NMW now seems a well established aspect of the employment landscape
but prior to its introduction there was vociferous debate about whether it should
even be introduced. For example, the British Hospitality Association (BHA) was
implacably opposed to the NMW. Much of the debate was centred on whether the
argument was best understood from a moral or economic point of view (see Wood,
1997b for an overview of the debate). For example, in the interests of social justice
proponents of the NMW suggested that all employees should be ‘decently’ paid.
On the other hand, opponents pointed to the likely rise in unemployment created
by rising payroll costs stemming from the NMW. It was in this context that the
NMW was introduced by the Labour Government. Once the minimum wage was
accepted as a key policy plank of New Labour’s notion of ‘fairness at work’, the
main issues became practical ones, such as the level the wage was set at and the
way it was implemented and enforced. To a large extent these issues were deter-
mined by the Low Pay Commission (LPC), which was established in July 1997 as
a statutory body and has continued to play a key role even after the enactment of
the minimum wage legislation. The LPC consists of nine members who represent
the interests of employers, unions and employees, and ‘objective’ independent
expert academics (Thornley and Coffey, 1999). Indeed, the LPC was able to largely
agree on the terms of the implementation of the NMW and is suggested as provid-
ing an exemplar of a positive social partnership between employers and employees
in particular (Metcalfe, 1999; though see Thornley and Coffey 1999 for a more
critical account).
The LPC reported in 1998 with the National Minimum Wage Act coming into
being in the same year and the NMW actually starting on 1 April 1999. There was
much discussion and horse trading in relation to issues such as the level of the
NMW and whether things like tips would be included. For example, with regard
to the rate the Confederation of British Industry suggested £3.20, the Trades Union
Congress had suggested £4.00 and many trade unions and pressure groups, such
as the Low Pay Unit (LPU), using the formula of applying half male median earn-
ings to the New Earnings Survey, suggested £4.61. George Bain, then chair of the
LPC, had gone on record to suggest that £3.75 was not outrageous (Barnett, 1997)
and it was calculated that if Wages Councils had still been in existence the rate in
April 1999 would have been £3.90 (Metcalfe, 1999). Ultimately though the main
rate was set by the LPC at £3.60 (see HRM in practice 9.6).
The reaction to the NMW was mixed. On the one hand employers views were
generally favourable about what they felt was an acceptable rate. For example, the
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BHA applauded what they considered to be a ‘realistic’ wage, supported the
‘sensible’ level for 18–21-year olds, but expressed regret that there were no
regional variations (Clavey, 1998). There were also some concerns from some
tourism employers that the accommodation offset would count towards payment
of the NMW but only at the rate of £20 per week (Fox, 1998; at the time of writing
this offset now stands at £27.30).
On the other hand, trade unions and the LPU were less sanguine at what they
felt to be an overly prudent and overcautious rate. As Bill Morris, then General
Secretary of the Transport and General Workers Union, pithily put it, ‘Thank you
for the principle, shame about the rate’ (cited in Metcalfe, 1999: 193). Similarly,
Rodney Bickerstaffe, then General Secretary of Unison, applauded the implemen-
tation of the NMW whilst also suggesting that, ‘£3.60 for an hour of anyone’s life
at the end of the 20th century in one of the richest countries on earth is not some-
thing to be proud of’ (cited in Clavey, 1998: 10; and see HRM in practice 9.7).
HRM in practice 9.6 The LPC: Shaping the
NMW in tourism and hospitality
Main recommendations:
? NMW to be £3.60 with an upgraded rate of £3.70 in June 2000.
? Development rate for 18–21-year olds £3.20 per hour rising to £3.30 by June 2000.
? NMW not expected to be subject to regular annual revision and not index-linked in
any fashion.
? 16–17-year olds exempt.
The Government response:
? Acceptance of the £3.60 figure, which came into force on 1 April 1999.
? Development rate to be £3.00 per hour.
? No guarantees that the upgraded rate would apply to either the development or full
rate in June 2000.
? Exemption of young workers.
? Tips and service charges distributed centrally via payroll to count against NMW, but
cash tips paid by customers directly to staff not included.
? A maximum figure of £20 to be deducted for the cost of employees’ accommodation.
Derived from Walsh (1998); Metcalfe (1999).
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Despite the disappointment on the part of trade unions and other lobbying
bodies at the rate at which the NMW was set, approximately two million workers
did receive a wage increase as a result of the legislation, with many of these work-
ers being women, part-timers, youths, non-whites and single parents (Metcalfe,
1999). Of course many of these workers were to be found in tourism and hospital-
ity with the LPC estimating that around 800000, or 42 per cent, being in the retail
and hospitality sectors (LRD, 1998).
Although the tourism and hospitality industry was disproportionately
affected in terms of the number of employees who benefited from the NMW, due
to its low rate it has been suggested that in reality there has been ‘minimum
impact’ and ‘much ado about nothing’, even in smaller businesses (Rowson, 2000;
Turnbull, 2000; Adam-Smith et al., 2003). Indeed, a survey undertaken of low-
paying sectors by Income Data Services (IDS) prior to the introduction of the
NMW found that a number of larger tourism and hospitality companies, such as
Centre Parcs and Marriott, where already paying at, or over the rate at the point of
implementation (IDS, 1999, though see also HRM in practice 9.8).
Employer concerns about issues such as loss of competitiveness and job losses
have also proved to be wide of the mark (LRD, 2001). For example, Lucas (2004)
notes how employment has increased in the hospitality sub-sector by over 200000
since 1999.
As was noted earlier in this chapter the LPC having initially recommended the
rate for the NMW has had the responsibility of reviewing its operation and in the
HRM in practice 9.7 A ‘Living Wage’?
The GLA (2006) note that since the inception of the NMW, at what many trade unions felt
to be an unnecessarily low level, there has been much discussion of what is an ‘acceptable’
level for the NMW. More recently, a campaign has emerged in support of a ‘living wage’.
Originating in America, the living wage campaign aims to address what it considers to be
‘poverty wages’. Currently it is suggested that the ‘living wage’ for London should be £7.05
(similar campaigns have been started in other parts of the UK) and campaigners are seek-
ing to target industries such as tourism and hospitality to ensure that companies are pay-
ing this wage. With mayoral support in London and a commitment from the London 2012
Olympic project team to the living wage, the campaign has enjoyed some success in
raising the issue of low pay.
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period from 1999 has recommended regular annual uprating, though this has
reflected prevailing economic circumstances rather than any particular uprating
formula. Interestingly though in the period 2002–2006 the adult minimum wage
has increased by 27.4 per cent, while average earnings increased by just 17 per cent
(LPC, 2006). Though in its most recent report the LPC does acknowledge that the
phase in which they are committed to increasing the NMW above average earn-
ings is now complete and in future will have no presumptions that increases above
average earnings are required. Importantly, the LPC also recommended that
16–17-year olds be brought under the umbrella of the NMW from October 2004
(see Table 9.1). Bringing 16–17-year olds under the aegis of the NMW again dis-
proportionately impacted on tourism and related industries with retail and hospi-
tality respectively accounting for 45 per cent and 21 per cent of the overall total
brought under minimum wage protection (LPC, 2006).
Although the NMW is a relatively recent phenomenon in the UK nearly all
OECD countries have minimum wage setting arrangements (Metcalfe, 1999).
Anumber of Scandinavian countries and countries such as Germany and Italy rely
on collective bargaining mechanisms to set minimum wages, ordinarily at a
sectoral level. In a large number of countries though there are statutory require-
ments and it is interesting to compare the UK with a number of other countries
(see Table 9.2).
HRM in practice 9.8 Pizza Hut and Pizza
Express: Taking away from their
employees
Pizza giants, Pizza Hut and Pizza Express, found themselves at the centre of controversy
when the NMW was implemented. Both companies responded to the implementation of
the NMW by seeking to reign in costs. Pizza Hut removed paid taxi fairs home for their
staff, claiming that they could no longer afford this benefit with the introduction of the
NMW. Pizza Express initially retained a basic rate of pay of £3.10, with the expectation
that tips would make up the shortfall, despite the law saying that tips could only be
included if they were paid through the bill. As a result of this decision the company was
ultimately forced to pay out £250 000 in back pay to waiting staff.
Derived from Anon (1999a, b).
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In addition to basic pay there are a number of other aspects which can be con-
sidered in reviewing payment issues in tourism and hospitality. IDS (2005a, b) in
their annual review of hotels, pubs and restaurants note a number of additional
areas where employees could enhance basic pay. Just over half of the 20 hotels they
surveyed offered a premium for night work. This payment could either be a flat
rate, for example night porters in one hotel could earn £1800 more than day porters.
Alternatively some of the surveyed hotels paid a premium for those hours worked
at night with IDS citing the example of food and beverage staff receiving an add-
itional 30 pence an hour for every hour worked past midnight. With regard to the
broader issue of bonus and incentive schemes, all but two of the surveyed hotels
offered a bonus or incentive scheme. Many of these schemes attempt to incentivize
front-line staff to offer good quality service in showing appropriate behaviours and
attitudes and may use some of the customer appraisal techniques discussed in the
previous chapter, such as mystery guests. In over half of the schemes payments are
related to sales, with profit- and performance-related payments being the next most
Review and reflect
In considering debates about the NMW and the pay disparities outlined in HRM in
practice 9.1, is there an argument for a maximum wage?
Table 9.1 How the UK NMW has evolved since 1999
Adult rate Development rate 16–17-year olds rate
(for workers aged 22?) (for workers aged 18–21)
1 April 1999 £3.60 1 April 1999 £3.00 – –
1 October 2000 £3.70 1 October 2000 £3.20 – –
1 October 2001 £4.10 1 October 2001 £3.50 – –
1 October 2002 £4.20 1 October 2002 £3.60 – –
1 October 2003 £4.50 1 October 2003 £3.80 – –
1 October 2004 £4.85 1 October 2004 £4.10 1 October 2004 £3.00
1 October 2005 £5.05 1 October 2005 £4.25 1 October 2005 £3.00
1 October 2006 £5.35 1 October 2006 £4.45 1 October 2006 £3.30
Source: http://www.lowpay.gov.uk/ Reproduced with permission from the LPC.
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common measure. The criteria differed across the hotels. IDS cite the example of
Hilton where heads of division receive a bonus based on profit, service and people
management, whereas staff received a bonus based on sales. In one of the surveyed
hotels food and beverage staff received a bonus based on service charge. Only one
of the surveyed hotels had a share option scheme and one also operated payments
for guest mentions. Afurther issue is that of pay progression and IDS note how a
number of the fast food companies that they surveyed linked pay to progression.
For example, McDonald’s links pay increases to performance appraisals, which are
based on four fixed levels, 0 per cent for ‘needs improvement’, 3 per cent for ‘good’,
4.5 per cent for ‘excellent’, 6 per cent for ‘outstanding’, with most employees receiv-
ing a 3 per cent rise. Pay progression may also be linked to the completion of
Table 9.2 Comparison of the level of the adult minimum wage across selected countries,
end 2004
Country (and year first In UK £
a
Age at which full Adult rate
introduced) rate usually applies as a percentage
of full-time
median earning
Australia (1996, some form 5.37 21 58.5/55.1
b
since 1907)
Belgium (1975) 4.92 21 48.5
Canada (women 1918–1930,
men 1930–1959) 3.66 16 39.5
France (1950, 1970 in current form) 5.20 18 56.6
Ireland (2000) 4.15 20 51.7
Japan (1959, 1968 in current form) 2.71 – 33.7
Netherlands (1968) 5.04 23 46.4 (50.1)
Portugal (1974) 1.99 16 38.0 (44.4)
Spain (1963, 1976 in current form) 2.34 16 30.0 (35.0)
United Kingdom (1999) 4.85 22 43.2
United States (1938) 3.37 20 32.2
a
Adjusted for purchasing power parities (August 2004).
b
Depends on the earnings survey used.
Figures in brackets include annual supplements.
Derived from Metcalfe (1999); LPC (2005).
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training in Prêt A Manger, where employees have to pass three assessments and
written tests to progress. Similarly, within the travel industry a recent survey of
salaries reported in IRS (2006b) found that bonus payments were common at all
levels of the industry. For example, half of the companies in the survey paid com-
mission to employees, based on their sales.
The practice of tipping
The notion of tipping is important in a number of ways, not least in its economic
importance. For example, Lynn (2003) suggests that consumers tip over $16 billion
a year in the US. Tipping may allow some tourism and hospitality workers to sig-
nificantly augment their income, though the potential impact with regards to
issues such as job satisfaction and emotional well-being equally need to be consider-
ed. Ogbonna and Harris (2002) also note the possibility of tipping being used as a
managerial mechanism to encourage individualization and subjugation of
employees. Tipping in this latter view becomes an important managerial tool for
the indirect control of employees in the employee–customer interaction, as well as
potentially suppressing interest in more collective power, for example through
trade union organization. Ogbonna and Harris (2002) note how employees in the
UK restaurant they studied resisted managerial attempts to resort to a system in
which tips would be kept by the company in return for a 10 per cent increase in
pay; in addition in the same case study management threatened to abolish tipping
if the employees became unionized.
It is important to note that tipping is very much culturally bound and as Ogbonna
and Harris (2002: 726) recognize, ‘although tipping is an internationally recogniz-
able behaviour, the actual practice is heavily influenced by societal cultural con-
siderations’. For example, tipping is widely practiced within the US, but is not as
widespread in the UK and elsewhere (see HRM in practice 9.9).
Review and reflect
What are likely to be some of the financial and emotional hazards for tourism and hos-
pitality employees who are reliant on tips to sustain a reasonable wage?
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Tipping is then largely driven by socio-cultural norms and/or individual con-
science. In relation to tourism and hospitality we should recognize that some
workers are in a position to enhance basic wages from tips, but this is only true for
those in tipped positions. Even for those in tipped positions it should also be
acknowledged that tips are notoriously unpredictable. Lynn (2001; and see also
Lynn, 2003) conducted a meta-analysis of a number of studies which had exam-
ined the relationship between restaurant tipping and service quality and found a
weak relationship. Consequently, for many front-line staff tipping may be more
influenced by external factors such as the race and gender of the customer, pre-
vailing weather conditions or even the result of football or rugby matches that are
played near the restaurant (Ogbonna and Harris, 2002).
The point is often made as well that tipping means losing sight of the fact that
the vast majority of people in tipping positions are generally in low-wage, low-
status occupations. Despite this point there is an argument, usually from employers,
HRM in practice 9.9 Tipping in different
countries
The US is generally recognized as having the most highly developed approach to tipping.
For example, it is not unusual for hotel guests to have to tip five people before they get
to their room. In the US for many tipped positions the general expectation is that cus-
tomer should tip at least 15 per cent. Tipping is less prevalent in other countries such as
Australia, New Zealand and Sweden. For example, in New Zealand tipping is not consid-
ered a normal cultural practice and moves to a US-type approach appear unlikely.
Managers and employees in New Zealand saw the institutionalization of tipping in the
US as distasteful and were particularly unanimous in their denunciation of the US prac-
tice of using tips to boost poor wages. It was felt that employers should fairly remuner-
ate employees and that this should not be left to customers. In many south-east Asian
countries it is not customary to tip and tipping can be a sensitive topic, especially if social
conventions are breached and people lose ‘face’. In contrast, research in France – where
tipping is unusual – found that if a waitress touched customers she got more and better
tips. This ‘touch effect’ is found in other countries, such as the US, but seems particularly
pronounced in France due to the tactile nature of social relations.
Derived from Callen and Tyson (2000); Casey (2001); Dewald (2001); Gueguen and
Jacob (2005).
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that tipping is a good motivator and that abolishing tips and paying higher wages is
not the answer, while alternatively others argue that tips are an unwelcome part of
the tourism and hospitality industry and a ‘fair’ fixed living wage would be more
desirable (Wood, 1997a). Critics of tipping would also argue that the practice weak-
ens social relationships as a number of interactions in tourism and hospitality
become overtly economic exchanges. It is also argued that tipping increases power
differences as in menial low-status jobs tipping reinforces and makes salient the infe-
rior status of workers. For example, Ogbonna and Harris (2002) found that a num-
ber of waiters and waitresses they interviewed felt that they were often abused
physically and mentally and had to accept subtle forms of sexual exploitation.
Engaging in sexualized flirting with customers may be part of a process that
degrades and debases front-line workers, often for comparatively little financial
reward (a point further considered in Chapter 11). There is also the final related
point that tipping tends to encourage a very individualistic view of the workplace
and does little to sustain a harmonious workplace relationships and that tipping
tends to weaken organizational commitment.
Clearly there is much debate about the efficacy and morality of tipping, though
given the reality of this practice still being prevalent in a number of tourism and hos-
pitality environments it is worthwhile briefly considering the underlying motives
for tipping and how servers may maximize their tips. With regard to motives under-
lying tipping Lynn et al. (1993) suggest the following:
? Desire for good service in the future.
? Desire for social approval.
? To compensate servers equitably for their work (i.e. reward their effort).
? Desire for status and power.
Furthermore, Lynn (1996 and 2003) reports on research which suggests a number
of ways in which servers’ are likely to increase their tips:
? Server introduction in a genuine and professional manner.
? Squatting next to table, though this is more likely to work in a casual dining envir-
onment, compared to fine-dining where it may be considered inappropriate.
? Smiling at customers.
? Touching customers.
? Credit card insignia on tip trays.
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? Writing ‘Thank You’ on checks.
? Drawing a ‘happy face’ on checks.
? Wearing a flower in hair and other means of personalizing the server’s appearance.
? Entertaining customers by for example telling a joke.
? Forecasting good weather.
? Calling customer by name.
Of course, there are several obvious caveats to the above discussion. First, the
research is based in the US and as we noted earlier in this chapter tipping is a cul-
turally bound phenomenon. Second, not all of these tip-enhancing techniques will
be appropriate for every type of restaurant or service setting, or indeed every
server. Consequently some of these aspects may work better than others and
should be used advisedly, both by individual employees and managers who
encourage servers to use such techniques.
Fiddles and knock-offs
Whilst basic pay, accommodation and tipping represent the more formalized aspects
of the reward package in tourism and hospitality it is also briefly worth considering
fiddles and knock-offs. Mars and Nicod (1984) found a large range of fiddles in their
work and note how ‘they are acts of dishonesty which the people involved do not con-
sider dishonest’ (p. 116). Fiddles generally involve pilferage from organizations, usu-
ally in a monetary sense. Knock-offs can also be considered a form of fiddle involving
the purloining of (usually) small items such as soap, linen and towels. Generally, these
practices are institutionalized within the organization and may be dependent on a
degree of management and supervisory collusion, although certain boundaries and
parameters will be set to delineate what is ‘acceptable’. Indeed, with regard to this
notion of acceptability organizations may tighten up on a ‘blind eye’ approach to fid-
dles and knock-offs when business slackens and the organization is looking to reduce
labour costs (Lucas, 2004). Afurther important point noted by Wood (1997a) concerns
the notion of individualism and the extent to which this is exacerbated by these prac-
tices. Thus, ‘Whatever arrangements exist for the allocation of fiddles and knock-offs
there are some grounds for believing that, as with tipping, these aspects of informal
rewards militate against the development of a collective workplace or occupational
ethic, fostering individualism and competitiveness’ (p. 88).
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Other benefits
Although Mars and Mitchell characterized their model as a ‘Total Rewards
System’, many critiques have suggested that the use of total in this instance is
clearly a misnomer, and neglects a variety of other rewards which may be made
available by the organization. For example, in their survey of 20 hotel companies
IDS (2005b) found that three quarters provided free meals and staff discounts on
rooms, restaurants and shops within the hotel. Twenty per cent offered free use
of leisure facilities, including spas, beauty therapists, chiropodists and gyms.
HRM in practice 9.10 Total rewards fly in at
First Choice Airways’
First Choice Airways’ is a UK leisure airline and part of First Choice Holidays plc. The com-
pany employs over 14 000 staff, including nearly 400 pilots. The rigorous entry require-
ments and on-going training and competency testing at least twice a year are indicative
of the high level of responsibility associated with being a pilot. Resultantly the company
has recently reviewed the total reward package offered to pilots and as a consequence
developed a ‘Pilot Change Agenda’. A key part of the change agenda was to ensure the
pilots felt valued. Amongst other things this has led to the company to review the pay
and other rewards offered to pilots and to develop a new ‘total reward’ perspective.
Traditionally pilots already had a very good rewards package including: competitive base
pay; two final-salary pension schemes; a money purchase pension scheme; free medical
checks; private medical insurance; concessions of £1000 per year to spend on First
Choice holidays, and the option to buy further holidays on a tax efficient basis; free uni-
forms; duty and subsistence allowances; share plans; voluntary benefits, for example
childcare vouchers and other insurance and generous annual leave entitlement. Under
the new change agenda additional aspects of the total reward system include a new
bonus plan that links payments to adherence to corporate values and desired behaviour
or performance, a new share plan scheme, flexible working options and a new long serv-
ice award scheme. Of course, the nature of this package is very much driven by the
highly competitive environment in which the company is operating and the unique
nature of pilots as a group of employees in terms of their skills and qualities.
Source: IRS (2006c).
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Around a sixth of hotels offered a pension scheme. Only one hotel provided life
assurance, dental, optical and private medical care. A minority of respondents
paid maternity pay above the statutory minimum, with 70 per cent paying sick
pay above the statutory minimum. Asimilar survey conducted in the travel indus-
try and reported in IRS (2006b) also noted a range of benefits. Over 70 per cent of
the 34 companies surveyed offered a company pension scheme, though only 11
per cent of companies offered a final salary pension scheme. Over half of the com-
panies offered private health insurance, with 39 per cent offering life insurance
and see HRM in practice 9.10.
Although HRM in practice 9.10, in particular, illustrates the possible range of
additional benefits that could be made available, in reality research suggests that
most tourism and hospitality workers are less likely to enjoy such benefits. For
example, Lucas (2004) cites figures from the Workplace Employee Relations Survey
which compares the tourism and hospitality industry with all private sector services
in terms of non-pay terms and conditions. With regard to employer pension scheme,
company car/allowance, private health insurance and sick pay in excess of statutory
requirements tourism and hospitality employers were significantly lagging behind
other employers in both private service sector and all industrial sectors.
Conclusion
We have examined a range of issues which cover rewards and payment which
demonstrate that arguably a fair and effective deal is still some way off for the bulk
of the tourism and hospitality workforce, and especially those in the hotel and
catering sub-sector. In an ideal world the effort–reward bargain would satisfy all
parties but the reality is different so for employers the strategy that is pursued
seems to coincide with the controlling operations and cost aspects of Torrington
et al.’s framework and for the employees there is little choice and no real sense of
aspiring to any of the loftier principles embodied in the Torrington et al. frame-
work. Furthermore prescriptive accounts of ‘total reward’ schemes that support
the notion of employees picking and choosing from a range of options to tailor a
pay and benefits package that meets their particular needs, need to be treated with
a good deal of caution in tourism and hospitality where the cafeteria approach
remains rare. Of course, as we acknowledged, there are exceptions to low pay both
sub-sectorally and occupationally, though for the majority of employees in
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tourism and hospitality notions of ‘fair’ remuneration remain somewhat elusive.
Indeed, this may seem rather paradoxical as often those entrusted with delivering
high-quality service may be the lowliest paid in the organization.
References and further reading
Adam-Smith, D., Norris, G. and Williams, S. (2003) ‘Continuity or change? The implications of the National
Minimum Wage for work and employment in the hospitality industry’, Work, Employment and Society,
17(1), 29–47.
Anon (1999a) ‘Restaurant chains make staff pay for the minimum wage’, Caterer and Hotelkeeper,
22 April, 4.
Anon (1999b) ‘Pizza Express hits out at MP’s slur on pay’, Caterer and Hotelkeeper, 15 July, 10.
Anon (2003) ‘Hospitality is lowest-paying industry’, Caterer and Hotelkeeper, 23 October, 6.
Anon (2006) ‘Is McJob still bad for you?’ Guardian Work, 10 June, 2.
Barnett, A. (1997) ‘No gain without Bain for the minimum wage’, Observer Business Section, 8 June, 16.
Baum, T. (2006) Human Resource Management for Tourism, Hospitality and Leisure: An International
Perspective, Thomson Learning.
Bozec, L. (1999) ‘Government report says hospitality is one of worst payers’, Caterer and Hotelkeeper,
28 October, 4.
Callen, R. and Tyson, K. (2000) ‘Tipping behaviour in hospitality embodying a comparative prolegomenon
of English and Italian customers’, Tourism and Hospitality Research, 2(3), 242–261.
Casey, B. (2001) ‘Tipping in New Zealand’s restaurants’, Cornell Hotel and Restaurant Administration
Quarterly, 42(1), 21–25.
Clavey, J. (1998) ‘Unions slam level of minimum wage’, Caterer and Hotelkeeper, 4 June, 10.
Dewald, B. (2001) ‘Restaurant tipping by tourists in Hong Kong’, Anatolia: An International Journal of
Tourism and Hospitality Research, 12(2), 139–151.
Foot, M. and Hook, C. (2005) Introducing Human Resource Management, Prentice Hall, 4th edition.
Fox, L. (1998) ‘ABTA shows concern over minimum wage’, Travel, Trade Gazette, 2 December, 6.
Goldsmith, A., Nickson, D., Sloan, D. and Wood, R. (1997) Human Resources Management for Hospitality
Services, International Thomson Business Press.
Greater London Authority (2006) A Fairer London: The Living Wage in London, GLA.
Gueguen, N. and Jacob, C. (2005) ‘The effect of touch in tipping: an evaluation in a French bar’,
International Journal of Hospitality Management, 24(2), 295–299.
Guerrier, Y. and Adib, A. (2004) ‘Gendered identities in the work of overseas tour reps’, Gender, Work and
Organizations, 11(3), 334–350.
Income Data Services (1999) ‘Implementing the National Minimum Wage’, IDS Report, No. 783,
April, 8–13.
Income Data Services (2004) ‘The impact of recent NMW increases in the UK leisure industry’, IDS Pay
Report, No. 906, June, 16–17.
Income Data Services (2005a) ‘Pay in hotels’, IDS Pay Report, No. 943, December, 11–15.
Income Data Services (2005b) ‘Pay in pubs and restaurants 2004/5’, IDS Pay Report, No. 931,
June, 11–15.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 212
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REWARD STRATEGI ES I N THE TOURI SM AND HOSPI TALI TY I NDUSTRY 213
Industrial Relations Services (2006a) ‘ASHE 2005: earnings growth fails to keep pace with inflation’, IRS
Employment Review, No. 840, 3 February, 31–35.
Industrial Relations Services (2006b) ‘£21 753 a year for travel industry employees’, IRS Employment
Review, No. 843, 24 March, 28.
Industrial Relations Services (2006c) ‘Smooth take-off for First Choice Airways’ new reward strategy’, IRS
Employment Review, No. 843, 24 March, 29–32.
Labour Research Department (1998) ‘Short changing young workers’, Labour Research, December, 11–13.
Labour Research Department (2001) ‘Is the minimum wage debate over?’ Labour Research,
May, 11–13.
Lindsay, C. and McQuaid, R.W. (2004) ‘Avoiding the “McJobs”: unemployed job seekers and attitudes to
service work’, Work, Employment and Society, 18:2, 297–319.
Low Pay Commission (2005) National Minimum Wage Low Pay Commission Report 2005, The Stationery
Office.
Low Pay Commission (2006) National Minimum Wage Low Pay Commission Report 2006, The Stationery
Office.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
Lucas, R. and Radiven, N. (1998) ‘After wages councils: minimum pay and practice’, Human Resource
Management Journal, 8(4), 5–19.
Lynn, M. (1996) ‘Seven ways to increase servers tips’, Cornell Hotel and Restaurant Administration
Quarterly, 37(3), 24–29.
Lynn, M. (2001) ‘Restaurant tipping and service quality’, Cornell Hotel and Restaurant Administration
Quarterly, 42(1), 14–20.
Lynn, M. (2003) ‘Tip levels and service: an update, extension, and reconciliation’, Cornell Hotel and
Restaurant Administration Quarterly, 44(5/6), 139–148.
Lynn, M., Zinkhan, G. and Harris, J. (1993) ‘Consumer tipping: a cross-country study’, Journal of Consumer
Research, 20, December, 478–488.
Mars, G. and Mitchell, P. (1976) Room for Reform? A Case Study of Industrial Relations in the Hotel
Industry, Open University Press.
Mars, G. and Nicod, M. (1984) The World of Waiters, George Allen and Unwin.
Metcalfe, D. (1999) ‘The British National Minimum Wage’, British Journal of Industrial Relations, 37(2),
171–201.
Milne, S. (1998) ‘Politics of the pig trough’, Guardian, 15 September, 10.
Milne, S. and White, M. (1998) ‘Read my lips “you greedy bastards”’, Guardian, 15 September, 7.
Ogbonna, E. and Harris, L. (2002) ‘Institutionalization of tipping as a source of managerial control’, British
Journal of Industrial Relations, 40(4), 725–752.
Overell, S. (2006) ‘Fast forward’, People Management, 9 February, 26–31.
Rowson, B. (2000) ‘Much ado about nothing: the impact on small hotels of the national minimum wage’,
The Hospitality Review, January, 15–17.
Thornley, C. and Coffey, D. (1999) ‘The Low Pay Commission in context’, Work, Employment and Society,
13(3), 525–538.
Torrington, D., Hall, L. and Taylor, S. (2005) Human Resource Management, 5th edition, Prentice Hall.
Turnbull, D. (2000) ‘Minimum impact’, The Hospitality Review, January12–14.
Walsh, J. (1998) ‘Pay commissioner denies fudge on development rate’, People Management, 25
June, 9.
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Wood, R. C. (1997a) Working in Hotels and Catering, International Thomson Press, 2nd edition.
Wood, R. C (1997b) ‘Rhetoric, reason and rationality: the national minimum wage debate and the UK hos-
pitality industry’, International Journal of Hospitality Management, 16(4), 329–344.
Websites
For an interesting discussion of the campaign towards a ‘living wage’, see http:// www.livingwage.org.uk/
The US version of the campaign also has a website at http://www.letjusticeroll.org/index.html
The Low Pay Commission has lots of useful material on their site at http:// www.lowpay.gov.uk/
There is lots of interesting material on tipping at http://www.tipping.org/index.shtml and http://www.
bbc.co.uk/dna/h2g2/alabaster/A640018
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Chapter 10
Employee relations,
involvement and
participation
Chapter objectives
This chapter considers the notions of employee
relations, employee involvement and employee
participation to review the extent to which
employees may influence managerial decision-
making. In particular, the chapter aims to:
? Recognize debates about employee/industrial
relations.
? Assess the differing ways in which conflict may
be conceptualized and resolved in the tourism
and hospitality workplace.
? Consider the role, or lack of it, for trade unions
in the tourism and hospitality industry.
? Appreciate how employee involvement and
employee participation mechanisms can be used
by tourism and hospitality organizations.
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Introduction
The idea of some kind of employee influence in organizational decision-making is
one that seems to attract much support amongst all the parties who are involved
in the employment relationship; that is, employers, employees, trade unions and
the state. Indeed, as Blyton and Turnbull (2004) note recent years have seen
renewed interest in employee involvement and participation. This renewed inter-
est is partly explicable by the Labour Government’s attempts to promote ‘partner-
ship’ at work as well as the influence of the European social agenda, which has
encouraged greater employee participation through a number of European Union
(EU) Directives. However, although there may be universal support in principle
for the need for employee influence in decision-making, in reality there are likely
to be sharply differing views on the degree (the extent to which employees are able
to meaningfully influence managerial decisions), level (task, departmental, estab-
lishment or corporate), range (the range of subject matters likely to be discussed,
from what might be trivial issues such as food in the staff canteen to fundamental
strategic decisions) and form (either direct of indirect through representation) of
such influence (Marchington and Wilkinson, 2005).
Recognizing the above discussion Blyton and Turnbull (2004) suggest a con-
tinuum from no involvement through to employee control, although in reality
most organizations are likely to fit somewhere in between in the categories of
receiving information, joint consultation and joint decision-making, which in a
generic sense are likely to be characterized as being either employee involvement,
participation or industrial democracy. Underpinning much of this discussion is a
need to understand the nature of employee relations and the manner in which
many argue that this notion marks a major shift from a more collective view of the
employment relationship as embodied in the notion of industrial relations.
Initially then the chapter will consider this debate about how best to conceptualize
the contemporary employment landscape. Following this discussion we will then
move on and examine how these debates can be understand with regard to the
‘frames of reference’ (Fox, 1966) adopted by management in terms of dealing with
potential conflict in the workplace. Conflict can be considered at a number of
levels, one of which is the potential conflict of interests between trade unions and
employers. However, the tourism and hospitality industry is often suggested as
being one where trade unions have little or no influence. The veracity or otherwise
of this view will be discussed, including why tourism and hospitality employees
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EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON
may or may not join trade unions. Having considered one mechanism for articu-
lating an employee ‘voice’, that of trade unions, the chapter moves on to consider
a range of other mechanisms which seek to involve employees in the decision-
making process in organizations through the processes of employee involvement
and participation.
Employee or industrial relations?
In a recent analysis of the nature of employee relations in the UK economy CIPD
(2005: 5) suggest that, ‘the term “industrial relations” summons up today a set of
employment relationships that no longer widely exist, except in specific sectors, and
even there, in modified form’. In this view industrial relations can be thought of as
denoting formal arrangements between employers and trade unions, in which col-
lective bargaining would provide the mechanism for joint regulation that would
give trade unions a say in key management decisions. This view of industrial rela-
tions held by CIPD is by no means universally held and amongst others Sisson
(2005) responded with a wide-ranging rejoinder questioning whether the descrip-
tion of industrial relations as being anachronistic is indeed true. Whilst at one level
this debate about the nature of ‘industrial’ or ‘employee’ relations might seem like a
typical academic parlour game it is nevertheless important to recognize that at the
heart of this debate are a number of crucial concerns which are likely to significantly
influence arguments about the nature of employee involvement and participation.
To appreciate such debates it is worthwhile briefly considering how industrial and
employee relations may be considered different.
Industrial relations has its roots very much in the social sciences and draws on
a number of academic disciplines such as economics, law, sociology, psychology,
history and politics. The scope of industrial relations has traditionally encom-
passed the study of social institutions, legislative controls and social mechanisms
and the way they provided the framework for interactions between the key actors
in the employment relationship: government, employers and their organizations
and employees and their organizations. At the heart of industrial relations lies the
notion of how these partners manage the employment relationship, which denotes
an economic, social and political relationship for which employees provide man-
ual, mental, emotional and aesthetic labour in exchange for rewards allocated by
employers. Often debates about the employment relationship would centre on the
217
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notion of the effort–reward bargain. As we saw in the previous chapter the
effort–reward bargain refers to the manner in which employees are rewarded for the
effort they expend on behalf of the organization. The potential conflict that would
arise in the allocation of effort from employees and reward from employers would
often be resolved through the use of, often adversarial, collective bargaining, where
trade unions and employers would come together to attempt seek a resolution based
on their relative strengths. Industrial relations, then, is often thought of as denoting
the formal arrangements to manage the employment relationship that existed in
large manufacturing plants where the world of work largely consisted of unionized
male manual workers who worked full-time (Blyton and Turnbull, 2004).
By contrast, employee relations emerged as a term in the 1980s in an attempt
to capture the changing nature of the employment landscape. In particular, as
CIPD (2005: 3) argues, ‘employee relations is now about managing in a more com-
plex, fast-moving environment: the political, trade union and legislative climates
are all shifting. In general, the agenda is no longer about trade unions’. Within this
view of employee relations then a key aspect of what is considered distinctive
about the term is a lack of trade union influence. In addition, employee relations
has also tended to be considered as denoting the changing nature of employment
in terms of the shift from manufacturing to service employment and the feminiza-
tion of the labour market. These shifts have had a significant impact on employ-
ment and work, for example the increasing number of employees who work
‘non-standard’ hours or the much greater involvement of the customer as a third
party in the employment relationship (Lucas, 2004).
As we acknowledged earlier there are many who would argue that these are
rather simplistic interpretations of the terms (Sisson, 2005). To an extent though the
above discussion does have an element of truth and at the least it is useful in denot-
ing key shifts in the nature of employment in recent years. In particular, the shift
from manufacturing to service employment and reliance on collective institutions
to a more individualized view of the employment relationship are clearly apparent.
Frames of reference and the resolution of conflict
Notwithstanding the debate about the terms industrial and employee relations a
key point that remains is the likelihood of conflict or competing interests existing
in the employment relationship. Of course, these aspects may also exist alongside
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more co-operative relationships and this notion of how employers view both con-
flict and co-operation can be further appreciated by drawing upon the unitary and
pluralist ‘frames of reference’ (Fox, 1966) through which the employment relation-
ship can be viewed.
Within the unitary frame of reference the metaphor of a football team is often
used to illustrate this perspective on the employment relationship (Marchington
and Wilkinson, 2005). In this view organizations are conceptualized as a team in
which all participants are aiming for the same goal, have similar objectives and are
not in conflict with one another. The unitary perspective sees the organization as a
cohesive and integrated team, where everybody shares common values, interests
and objectives to achieve the goal of the efficient functioning of the enterprise.
Within this approach a key element is the recognition of the managerial preroga-
tive and the unrestrained ‘right to manage’. Managers are the single source of
authority and act in a benign and rational manner for the benefit of employees.
Resultantly a unitary view of the employment relationship would be framed and
constrained by the idea that conflict and dissidence are unnecessary, undesirable,
irrational and pathologically deviant behaviour. Any conflict that does arise will
be rationalized as being a reflection of frictional rather than structural problems
within the organization. Consequently, trade unions are viewed as being an unim-
portant and unnecessary intrusion into the organization. One final point about the
unitary perspective is the need to recognize there may be differing styles of man-
agement ranging from authoritarian to paternalistic, and the latter in particular
may underpin a more sophisticated unitarism which finds organizational expres-
sion in talk of ‘soft’ HRM in particular. Although the unitary perspective may be
easy to criticize for advocating an unrealistic view of the workplace, evidence sug-
gests that many British managers still hold unitaristic views of the workplace.
Indeed, Lucas (2004) suggests that unitaristic thinking is apparent in large parts of
the tourism and hospitality industry; and often this unitaristic thinking is the less
sophisticated version premised on cost-minimization and ‘unbridled’ individual-
ism, which creates a ‘poor’ employment experience for many in the industry.
The ‘them and us’ attitude which unitarism eschews is something that is
accepted as being integral to the pluralist perspective on the employment rela-
tionship. Conflict is accepted as being inevitable and rational because of the plur-
ality of interests in the organizational setting, though the resolution of such
conflict may be through differing approaches. In simple terms we can consider this
in terms of both collective and individual approaches.
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Collective approaches to conflict resolution will envisage a role for trade
unions to represent the interests of employees, though there may be very different
approaches adopted by trade unions depending on the institutional context in
which bargaining with employers takes place. For example, in the UK the rela-
tionship has often been characterized as being reflective of a ‘them and us’ culture,
where the relationship between employers and trade unions was antagonistic. In
attempts to institutionalize conflict in such an environment the bargaining process
would often be concerned with power bargaining or zero-sum ‘winner takes all’-
type bargaining. In such a process the relative economic strength of the employers
and trade unions could determine the eventual resolution of any such dispute. By
contrast, in a number of European countries the relationship between employers
and trade unions has been rather more consensual and premised on notions such
as ‘social partnership’ and ‘social dialogue’ (and see HRM in practice 10.1).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 220
HRM in practice 10.1 Social partnership
in Lufthansa
At a time when the airline industry has faced huge challenges in the 1990s and the post-
9/11 era, Lufthansa has drawn on the institutionally-embedded social partnership approach
common in Germany to stave of the worst effects of a downturn in the sector. At the
heart of this social partnership is an understanding that the company will consult and
negotiate with employees through works councils and trade unions. In particular, by con-
sidering the employee ‘voice’ the company has chosen to approach restructuring in a
manner which has not led to redundancies and a short-term response to the challenges
in the industry. This approach was in contrast to a number of other airline companies,
such as British Airways (BA) and Aer Lingus who both made large-scale job cuts in the
wake of September 11th. By a process of consultation and negotiation Lufthansa was
able to agree wage concessions and enhanced labour flexibility, through things like
changes in working time and voluntary unpaid leave to avoid redundancies. Though
these changes were made, overall there was no major deterioration in the terms and
conditions of employees. Consequently, the trust and co-operation between the social
partners was able to survive the immediate post-9/11 era and allowed the company to
consider a brighter future without the latent mistrust stemming from widespread redun-
dancies, a problem which faced other airlines.
Source: Turnbull et al. (2004).
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More recently, as we have already noted, many argue that British public pol-
icy has attempted to foster a climate which is more concerned with partnership
along European lines, a process that has also been driven to an extent by a number
of EU Directives encouraging greater consultation between employers and
employees. As well as collective approaches to conflict, disagreement can also take
place at a more individual approach. Again conflict is seen as inevitable but the
resolution of such conflict does not take place within a collective framework or
with the involvement of trade unions. Instead, the employment relationship is
based on employment contracts determined by market forces and common law
and ‘freely’ negotiated between employers and employees. Conflict may arise as
employees seek the highest level of reward, best conditions and least exacting
work, whilst employers seek the lowest level of payment, least costly conditions
and most efficacious and flexible use of labour.
In addition a final perspective initially developed by Fox (1974) and then refined
by others, adopts a more radical view of the employment relationship. In this radical/
Marxist approach the employment relationship is seen not so much in organiza-
tional terms, but in a much wider social, political and economic framework. In this
broader analysis of capitalist society capital and labour are conceptualized as being
engaged in an antagonistic ‘power struggle’ that is waged very much on capital’s
terms. Marxists or neo-Marxists argue that trade union power is illusory and only
maintains the delusion of a balance of power. In its purest form the Marxist per-
spective suggests that only by the working class gaining workers’ control will real
equality be established. In contemporary market-driven economies moves to work-
ers control are very unlikely. Nevertheless, it is important to recognize that the radi-
cal perspective provides the theoretical framework for more critical views of the
employment relationship, such as labour process analysis.
In sum, then there have been a number of significant changes in the employment
relations landscape in recent years. The shift from industrial to employee relations
Review and reflect
Think of your current workplace or where you have previously spent time on work place-
ment and consider which frame of reference best describes how conflict is managed. Is
this the best way to manage conflict?
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and the decline of trade union power and influence has led to increasing talk of a
more unitaristic and individualistic view of the employment relationship. As a
consequence there is often increasingly talk of the ‘death’ of trade unions, a view
which is now considered in more detail.
Trade unions: in terminal decline?
Awide range of factors has contributed to a decline in trade union membership in
the UK in recent years. In particular, the structural changes in the economy and the
decline in so-called ‘heavy’ industries such as coalmining, shipbuilding and steel
has particularly impacted on the unions. Equally, the legislative programme
enacted by the Conservative Governments in the 1980s and 1990s can clearly be
seen to be a significant influence. In addition to these aspects CIPD (2005) suggest
that global competitive pressures and employee attitudes are equally important.
In particular, younger people are unlikely to have ever belonged to a trade union
and it is suggested that many of them see no point in trade unions (LRD, 2004a).
The decline in trade union membership is within a context in which for the first
time in the UK there appears at first view to be much greater state support for
trade unions. This situation is a change from the past where historically there has
been little state support for trade union recognition in the UK and much of the
twentieth century could be best characterized as being voluntaristic, with minimal
intervention from the state in employment relations. More recently, though, there
has been greater state intervention, including the area of union recognition. In this
sense the Employment Relations Act (ERA) (1999) and (2004) means that trade
unions may gain recognition even where employers are implacably opposed to the
idea (LRD, 2006). Importantly though the legislation does not apply to small
Review and reflect
Trade unions are increasingly looking to recruit younger employees and in sectors where
they have previously had few members, such as tourism and hospitality. Think about your
own view of trade unions and consider why you think trade unions have had little suc-
cess in the past in recruiting members in the tourism and hospitality industry.
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employers, defined as those with 20 or fewer workers, which of course is the
majority of tourism and hospitality enterprises.
However, even within the changing employment relations landscape described
above it is arguable the extent to which trade unions are likely to make a significant
comeback. In part, this reflects a wider sense of managerial resistance to trade
unions. In attempting to understand the reasons for such resistance, Gall (2004)
notes how the period from 1979–1997 created what he terms a sense of ‘managerial
Thatcherism’. In essence, the legislative programme of primarily the Thatcher, but
also the Major, Governments sought to change the employment landscape by
severely restricting the ability of trade unions to organize and to take industrial
action and thereby secure recognition and successfully pursue their members’ inter-
ests in collective negotiations. For Gall one of the obvious outcomes that this period
engendered is a present day situation of ‘not insignificant employer opposition to
granting recognition’ (p. 36). Thus, despite the attempts by the Blair Governments to
ostensibly create an employee relations public policy which foregrounds a stronger
sense of partnership, it seems questionable, as Gennard (2002) argues, as to whether
there really is a ‘break with the past’. Indeed, some authors have gone so far as to
suggest that New Labour’s acceptance of the desirability of a largely deregulated
labour market as a source of economic competitiveness denotes a marked conver-
gence with the neo-liberal policies of the previous Conservative Governments and
has led to what is termed ‘Blatcherism’ (Red Pepper, 2004).
Regardless of debates concerning what is the most compelling explanation for
declining trade union membership and activity what is clear is the precipitous fall in
trade union membership. In 1979 there were 13289 million members, a density of
over 50 per cent. By 2005 the figure had declined to approximately 6.4 million, a
density of 29 per cent (DTI, 2006). Moreover, as Table 10.1 suggests low trade union
membership is not confined to the UK, but is also be seen in the US, Australasia and
large parts of Europe.
Whilst Table 10.1 outlines union density figures for the economy as a whole,
often the figure will be lower again for the tourism and hospitality sector. For
example, the International Labour Organization (ILO, 2001) has estimated that
globally the average figure for the tourism and hospitality industry is 10 per cent.
That said, we do have to exercise a degree of caution in recognizing this argument
not least because there may be significant differences between sub-sectors like
hotel and catering, compared to the airline industry, for example. Even then there
may be national differences in the relative strength of trade unions in certain
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sub-sectors. For example, within the hotel and catering industry in the UK the cur-
rent trade union density is 4.2 per cent and trade unions have little real purchase or
influence (DTI, 2006). Conventionally a number of reasons are forwarded for low
levels of trade union density in the UK hotel and catering sub-sector (Macaulay and
Wood, 1992; Aslan and Wood, 1993; Lucas, 2004 and see also HRM in practice 10.2).
? Ethos of hotel and catering – for example the suggested conservatism and indi-
vidualism of the workforce and reliance on informal rewards tends to create a
workplace culture which is antipathetic to trade unions. The self-reliance that
this individualism tends to breed means that employees prefer to represent
themselves in negotiating with management.
? The predominance of small workplaces and their wide geographical dispersion
pose considerable challenges to trade union recruitment and organizing strategies.
The existence of a ‘family culture’ in many small and medium-sized enterprises
(SMEs) is also considered a significant barrier to organizing. For example, Lucas
(2004) in her interrogation of the 1998 Workplace Employee Relations Survey
(WERS) data found that hospitality employees in very small workplaces demon-
strated a much higher level of positive endorsement for their manager’s style of
management.
? Structure of the workforce – the workforce has high numbers of young workers,
students, part-timers, women, employees from ethnic minorities and migrant
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 224
Table 10.1 Union density in selected countries
Country % Union density (2003)
US 12.4
Australia 22.9
Japan 19.7
Germany 22.6
France 8.3
Italy 33.7
Sweden 78
Netherlands 22
Ireland 35.3
New Zealand 22 (2002 figure)
Derived from Visser (2006).
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workers, all groups who are not traditionally associated with trade union mem-
bership. This situation is also exacerbated by high labour turnover.
? Employer and management attitudes – as we have already noted the industry is
characterized by a unitary view of the employment relationship that sees no role
for trade unions. Consequently employers and managers are hostile towards
trade unions and will often pursue an active non-union policy.
? Role of trade unions – notwithstanding recent attempts by the Transport and
General Workers Union (T&G) and the GMB to organize parts of the hospitality
sector it is generally acknowledged that for too long trade unions failed to
develop effective strategies to organize the sector.
Although trade unions have failed to establish any real foothold within the UK
hotel and catering industry there is some evidence that they have had greater suc-
cess elsewhere and in doing so improved the working lives of their members (and
see HRM in practice 10.3 and 10.4).
As we noted earlier the relative lack of trade union presence is not universal in
the tourism and hospitality industry in terms of the relative strength of trade
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 225
HRM in practice 10.2 Failing to organize the
Dorchester Hotel
Wills (2005) reports how the T&G targeted the world-famous Dorchester Hotel in 1999
in attempts to gain union recognition. The Dorchester was targeted as it was a stand-
alone hotel which did not belong to a national or international chain, so for the purposes
of 1999 ERA would be counted as a single bargaining unit. From 1999–2002 the T&G
sought to gain union recognition. Although some employees did join the union, high
levels of labour turnover and the ethnic diversity of the staff made it difficult to sustain a
common union identity. When the T&G came to present its case to the Central
Arbitration Committee in December 2002 the union was unable to present a sufficiently
compelling case that a majority of workers constituting the bargaining unit would be
likely to support recognition. In part, this was due to the Dorchester claiming more work-
ers worked in the hotel than the T&G; although the union also found that a number of
their claimed members were either duplicate members or were no longer employed. The
failure to organize the Dorchester seems to point to the need for British unions to change
their tactics in seeking recognition and to develop a broader geographical, occupational
and sectoral focus, rather than concentrating on the level of the individual workplace.
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unions in different sub-sectors. For example, Baum (2006) recognizes that the airline
industry has always had a stronger trade union presence when compared to the
hotel and catering sub-sector, even in the UK (and see HRM in practice 10.5).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 226
HRM in practice 10.3 Unions making a difference
in the US
Research conducted by Bernhardt et al. (2003) in eight (half of which were unionized)
high-end, full-service ‘Class A’ hotels in four US cities found that unions could make a
difference to employees lives. The research focused on room attendants and food and
beverage staff and amongst other things found that in the unionized hotels wages were
higher, work intensity was lower, contract provisions on workload were more constrain-
ing and innovative bargaining was more prevalent. Such outcomes involve a partnership
of unions and management. These union–management partnerships, it was suggested,
can help to tackle industry-wide problems and demonstrate that ‘win-win’ or ‘mutual
gains’ solutions are possible in the hotel industry.
HRM in practice 10.4 Enhanced labour flexibility
in Australian hotels
Research by Knox and Nickson (2007) suggests that within Australia some hotel employers
engage in successful firm-level bargaining with trade unions, with unionization rates across
the industry far higher than in the UK. Case studies of two hotels found that management
at hotels with enterprise bargaining had decided to pursue both service excellence and cost-
minimization. This strategy focused on introducing employment practices that provided the
dual benefits of quality enhancement and cost reduction in such a way that they were not
in conflict with one another. This situation was achieved through partnerships and bargain-
ing with the trade union. The employers believed that they could best achieve their aims by
bargaining with the union rather than directly with employees because they were concerned
with receiving the support and co-operation of the workforce. Sophisticated rostering sys-
tems were introduced in order to align the needs of employer and employee more effect-
ively. The hotels also exhibited a strong commitment to enhanced functional flexibility, with
initiatives directed towards improving multi-skilling, service quality, ongoing training and
development and retention. In sum, the research highlighted Australia’s unique institutional
context and the potential benefits associated with regulation and union involvement.
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In sum, although there may be some pockets of trade union strength in the
tourism and hospitality industry, generally trade unions remain a marginal presence.
In a broader sense clearly any future for the trade union movement is contingent
upon their ability to organize in the service sector. The evidence to date suggests that
this may well be an uphill struggle for the trade union movement. As a consequence
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 227
HRM in practice 10.5 Conflict in BA
BA has had something of a chequered history in recent years in its dealings with trade
unions. When in 2003 the company sought to introduce a new automated time recording
system for check-in and ticketing staff it found itself involved in a costly industrial dispute.
The row centred on the introduction of a new electronic clocking-on system at Heathrow
airport, which staff feared would be used to push through other changes in pay and con-
ditions, such as the introduction of split shifts and annualized hours. These concerns and
the manner in which the system was being ‘imposed’ led to a two-day unofficial strike by
members of the GMB, T&G and Amicus trade unions. The dispute led to the cancellation
of over 500 flights affecting thousands of passengers. As well a PR disaster the dispute was
estimated to have cost the company £50 million. More recently the company also found
itself embroiled in an equally damaging dispute, albeit one not directly of its own making.
In 1997 BA chose to outsource its in-house catering operation to a company called Gate
Gourmet, who were the sole catering supplier for the company. Gate Gourmet was already
paying relatively cheap wages to their workers when in an attempt to drive down wages
even further the company employed 130 agency staff. This was despite the company’s pre-
vious attempts at restructuring, which had led to redundancies. As a result the original staff
held a meeting to wait for further news, which led to over 650 of them being sacked. In
response BA found itself facing costly sympathy action by baggage handlers and ground
staff, who were not only in the same trade union, T&G, as the Gate Gourmet workers, but
in some cases were also the husbands and brothers of the sacked workers. Once again BA
found itself having to cancel hundreds of flights, leading to over 100000 passengers being
stranded. As well as the immediate disruption caused by the action of the baggage hand-
lers the dispute in Gate Gourmet dragged on for several months customer refreshments to
some BA customer. The cost to BA of the strike action was estimated at between £35–45
million, though arguably the biggest cost was in terms of the company’s damaged reputa-
tion and lost custom in the future.
Derived from BBC (2005), Clark (2003), Morgan (2003) Townsend (2005).
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this lack of collective ‘voice’ provided by the trade unions means that most tourism
and hospitality employees are likely to sustain an influence in managerial
decision-making through the processes of employee involvement and participation.
Employee involvement and participation
As we have already noted there is a definitional and terminological debate on the
meanings of terms such as ‘employee involvement’, ‘employee participation’ and
‘industrial democracy’ (Blyton and Turnbull, 2004). Hyman and Mason (1995) sug-
gest that increasingly, talk of industrial democracy – which denotes a fundamental
change in the balance of power in society generally and the workplace specifically,
such as the establishment of employee self-management – has little currency in
contemporary market-driven economies. Consequently we are left with the notions
of ‘employee involvement’ and ‘employee participation’, which represent the ‘two
principal and in many respects contradictory approaches to defining and opera-
tionalizing employee influence’ (Hyman and Mason, 1995: 1).
Employee involvement
Marchington and Wilkinson (2005) recognize that there are a number of mecha-
nisms that have been introduced under the broad heading of employee involve-
ment, for example teamworking and empowerment to name just two. Whilst there
may be a number of differing initiatives there is nonetheless common agreement
of the intent of employee involvement. In that sense most writers recognize that
employee involvement is concerned with measures which are introduced by man-
agement to optimize the utilization of labour whilst at the same time securing the
employee’s identification with the aims and needs of the organization. Employee
involvement is seen as being very much a phenomenon of the 1980s and closely
linked with ‘soft’ HRM with its emphasis on unitarism and the creation of com-
mon interests between employer and employee. Employee involvement is man-
agerially initiated and characterized as direct, ‘descending participation’, which is
task-centred as it attempts to involve all individuals in the workplace (Salamon,
2000). In this way it seeks to provide employees with opportunities to influence
and take part in organizational decision-making, specifically within the context of
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their own workgroup or task. Therefore it is intended to motivate individual
employees, increase job satisfaction and enhance the sense of identification with
the aims, objectives and decisions of the organization. Organizations have a num-
ber of ways in which they can involve employees and Table 10.2 outlines the inci-
dence of these aspects in British workplaces with 10 or more employees, as found
in the 2004 WERS.
Marchington and Wilkinson (2005) note that these various techniques can be fur-
ther broken down between those where the organization simply communicates
downwards to employees, and those more concerned with upward problem solving.
With regard to downward communication it can be seen from Table 10.2 that this
form of employee involvement is especially prevalent amongst organizations. Direct
communication to the individual can take a variety of forms and involve a variety of
media both electronic and paper such as e-mail, intranet, company newsletters and
noticeboards. IRS (2005b) recently surveyed over 70 organizations across the econ-
omy and found that the most important aim of their communication strategy was
to keep employees informed about changes in the organization, closely followed by
improving employee engagement and improving employee performance. Though
downward communications can be useful in attempting to achieve these aims
through informing and ‘educating’ employees about managerial actions and inten-
tions they are also passive and are characterized by Marchington and Wilkinson
(2005) as the most ‘dilute’ form of direct participation. Indeed, Hyman and Mason
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 229
Table 10.2 Direct communication and information sharing techniques
Technique % of organizations using
technique
Meetings with entire workforce or team briefings 91
Systematic use of management chain 64
Regular newsletter 45
Noticeboards 74
E-mail 38
Intranet 34
Suggestion schemes 30
Employee attitude surveys 42
Adapted from IRS (2005a).
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(1995) suggest downward communications mechanisms are ultimately rather super-
ficial and question the extent to which they denote meaningful involvement.
By contrast a number of upward problem-solving techniques are more likely
to denote more meaningful involvement for employees, usually involving two-
way communication. These techniques may be directed at either individuals or
workgroups and are now considered. Suggestion schemes allow organizations to
potentially tap into the creativity in their workforce to make significant improve-
ments in just about every aspect of the business, for example improvements in
customer service (IDS, 2003). As a result they can improve the motivation and
commitment of workers, as they see their voluntary activity as being integral to
company success. Equally, there may also be more instrumental and tangible bene-
fits both to the individual, whereby employees are rewarded for ideas and for the
organization, who may accrue significant cost savings from suggestions emanat-
ing from employees. A second technique which aims to encourage more active
employee involvement is attitude surveys. More often than not employee attitude
surveys will be a census of all staff usually yearly or bi-annually (IDS, 2004).
Employees will usually be asked to give their views on a range of issues, including
(IDS, 2004):
? The organization’s strategic direction and leadership.
? Organizational culture.
? The organization as an employer.
? Pay and benefits.
? Working environment and conditions.
? Working relationships (i.e. with managers and colleagues).
? Company image.
? Overall satisfaction/commitment to the organization.
? Reaction to the survey and previous follow-up action.
The last point is important in delineating the need for organization’s to be trans-
parent in both disseminating results and being seen to act on them. As was alluded
to in Chapter 8 there may also be opportunities for employees to appraise their
manager’s performance. The suggested benefits of employees commenting on
managerial performance through employee attitude surveys are that it makes for
better management, although again this is contingent upon management accept-
ing and acting upon the results of surveys.
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In a group sense, initiatives within tourism and hospitality which seek to encour-
age employees’ involvement in upward communication are likely to be premised
on the notion of improving quality within the organization and towards the cus-
tomer, finding expression in techniques such as quality circles (QCs) and total
quality management (TQM). Lashley (2001) notes how QCs are essentially con-
cerned with consultation on the basis of management posing problems in the
expectation of receiving suggestions from employees. Suggestions are likely to be
directed towards improvements in service quality and productivity in particular.
He also reports evidence from the Accor Group where QCs have been used suc-
cessfully. Although employees were expected to act as volunteers and are not paid
for taking part in the QCs there was still significant interest amongst employees.
Amongst other things the QCs in Accor were able to speed-up customers breakfast
service and guest check-out times on the basis of identifying problems, suggesting
and testing solutions, measuring results and finally ‘rolling out’ the approved
solution. A more all-embracing approach to quality is via the notion of TQM,
which is more concerned to promulgate an integrated view of quality via
company-wide improvements in quality both towards the internal customer (the
employee) and the external customer. Baldachino (1995) reports a case study of a
luxury hotel where the implementation of a TQM philosophy was beset by a num-
ber of problems including employee suspicion of the rhetoric of TQM, empower-
ment and involvement when faced with the realities of redundancy, industrial
conflict and the more prosaic problem of a ‘them and us’ attitude emerging over
the car parking situation for managers and employees at the hotel. More sanguine
accounts of TQM claim several benefits from such a philosophy, including,
improved organizational efficiency, greater employee involvement, consistently
‘delighting the customer’ by exceeding their expectations and reduced labour
turnover (Hope and Muhlemann, 1998). An integral part of a TQM framework is
Review and reflect
Imagine you are a manager in a travel agency which is part of a large multinational com-
pany. As part of their involvement scheme the company runs an attitude survey which
gives employees the opportunity to comment on your performance. In the last survey
your employees have said that you are dictatorial and difficult to approach, how do you
respond?
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the role of empowerment, which is often seen as being synonymous with greater
employee involvement.
Empowerment may actually encompass a variety of employee involvement
techniques (Wilkinson, 1998; Lashley, 2001), though for clarity we will talk here of
empowerment as being predominately about encouraging front-line staff to solve
customers problems on the spot, without constant recourse to managerial
approval. As was discussed in Chapter 3 tourism and hospitality organizations are
increasingly attempting to develop an organizational culture which places quality
service at its centre. With customer expectations becoming ever more dynamic
empowerment is increasingly sold as being the key to achieving not only high levels
of service quality but also as a means to enhance the commitment and job satisfac-
tion of employees. In principle, empowerment allows employees to exercise greater
authority, discretion and autonomy in their dealings with guests. In reality, the lat-
itude allowed to employees is often circumscribed. For example, Jones et al. (1997)
in their study of the Americo hotel chain found that the use of a ‘compensation
matrix’ would dictate employee responses and allowed management to monitor
and measure such responses, creating tightly constrained discretion (see also Hales
and Klidas, 1998). Thus, although the rhetoric of empowerment is about attempting
to move decisively from a control-oriented organization to a commitment-oriented
organization, Riley (1996: 171) pragmatically recognizes that whilst ‘empowerment
is giving the employees the right to “break the rules” to serve the customer’ it is
also nonetheless important to recognize that ‘rules are always necessary for an
organization. It is a balance between organizational rules and discretion which
must be available quickly’.
As we recognized in Chapter 7 training and development of employees is also a
crucial part in operationalizing empowerment strategies, with employees requir-
ing training in areas like, social skills, communication skills, decision-making
skills, problem-solving skills, planning skills and teamworking. Relatedly there
will also be a need to re-orient managerial thinking towards a more facilitative and
coaching style, which should also attempt to impart a greater sense of trust and
Review and reflect
Can you really have empowerment which involves tightly constrained discretion?
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confidence in the ability of the front-line staff to make suitable decisions. This does
not mean that management’s role is completely emasculated or abrogated but
merely refined, although this may be particularly difficult for managers to accept
(Wilkinson, 1998). Equally it is important to create a ‘no blame’ culture where ‘well
intentioned errors’ are discussed in a supportive way in order that lessons can be
learned from any mistakes in decision taking by employees.
This latter point can be seen as one of the obvious benefits of empowerment
and a review of several writers suggests several other benefits to be derived from
empowerment (Wilkinson, 1998; Lashley, 2001; Baum, 2006):
? Reduction in the so-called social distance between customers and employees, so
service is not seen as servility.
? Improved quality and guest satisfaction, as the removal of close supervision cre-
ates a more responsive service delivery system.
? Enhanced motivation and job satisfaction for employees, leading to greater
commitment and reduced labour turnover.
? More time for managers to engage in strategic planning and customer
responsiveness.
? Cost savings and improvements from ideas generated by employees.
? Word of mouth advertising.
On the other hand there may also be a number of potential problems in empower-
ing employees. We have already noted how reality may not match the rhetoric of
companies in relation to the tightly constrained discretion which characterizes
many empowerment schemes. In addition, employees may also see empowerment
as about increasing risks and responsibilities without any commensurate extra
reward for the additional skills and discretion they are expected to demonstrate.
A further issue is that of job security, as empowerment may be used to justify
delayering, which in turn leads to a drastic reduction in the number employed by
the organization. There is also the vexed issue of the culturally-bound nature of
empowerment, which is often seen as a very Americanized approach to service
(Nickson, 1999). Consequently, and as we noted in Chapter 2, it may be especially
difficult to create an empowered culture in countries such as China and the post-
communist Eastern European states, though even within parts of Western Europe
there is also evidence of significant resistance to the precepts underlying empower-
ment (Klidas, 2002).
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Employee participation
Hyman and Mason (1995: 21) define participation as ‘state [or supra-state] initia-
tives which promote the collective rights of employees to be represented in organ-
izational decision-making, or to the consequence of the efforts of employees
themselves to establish collective representation in corporate decisions, possibly in
the face of employer resistance’. Salamon (2000) characterizes participation as
being pluralist, power-centred, indirect, representative and ‘ascending’ in its focus
on the managerial prerogative and attempts to extend employees collective inter-
est into a variety of areas and decisions at higher levels of the organization. The
expression of employee interests over company decisions may be via joint consult-
ation, works councils and worker directors. With regard to joint consultative com-
mittees (JCCs), Lucas (2004) notes how data from WERS 1998 suggests that
management committees for joint consultation, rather than negotiation, are rare in
the tourism and hospitality industry. Moreover, where such committees do exist
they tend to have quite a narrow focus in terms of what they will allow consultation
on. As Lucas notes, ‘Where committees function in the HI [hospitality industry],
health and safety is most likely to be discussed, followed by training, working
practices and welfare services and facilities. Pay and government regulations are
the least frequently discussed issues’ (p. 161). Consequently, in this section the
focus is mainly on works councils, both European and national.
European and national works councils
Hyman and Mason (1995: 32) suggest works councils are, ‘a representative body
composed of employees (and possibly containing employer representatives as
well) which enjoy certain rights from the employer’. Works councils have two
principal rights; firstly, the right to receive information on key aspects of company
activity, such as restructuring, HRM/personnel issues, health and safety, etc., and
secondly, the right to consultation on such issues prior to their implementation by
management. Works councils are common in Europe and often underpin approaches
based on social partnership, but have been a relatively rare phenomenon in the UK
with only a small number of companies setting up voluntary agreement (and see
HRM in practice 10.6).
More recently though within the UK especially the situation has changed with
European-inspired regulation, which has established European Works Councils
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EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 235
HRM in practice 10.6 PizzaExpress: Spreading
the word
As was noted in Chapter 9 PizzaExpress’ image was seriously damaged in 1999 following
the revelation that they had been rather disingenuous in their interpretation of the min-
imum wage legislation in the UK. Clearly, the company had to start improving internal com-
munication to pinpoint and address sensitive issues which arose from this dispute. To tackle
this problem, the HR department gave the job of communications manager to Steve
Perkins, who was then a member of the restaurant staff. Perkins decided to set up a
company-wide works council system similar to those running in EU nations. The first step
was to look at other companies’ practices but Perkins was told to develop a system that
best suited the company. The new communication system took more than 18 months to
become fully effective. The work councils are now run at local, regional and national levels,
from individual restaurants to headquarters. They involve managers and staff representa-
tives alike. At the restaurant level, forum discussions are held every 2 months and involve
managers, staff representatives and staff themselves who are encouraged to express their
concerns. Problems can be settled at this stage, although unresolved issues can be taken to
one of the seven regional councils held by regional managers and restaurant representa-
tives. Again, issues can be brought to the national forum, which meets every 6 months and
involves top-executives and board members. The new works council witnessed several
breakthroughs. For instance, the system prevented massive complaints from employees
about reduced wages, when the company was only trying to take out an amount of the
wages to adjust it tax-wise and give it back at a lower tax rate. Thanks to the forum, rep-
resentatives were able to identify and calm their colleagues’ fears. From a company point
of view the consultative process also has the advantage of avoiding negotiations with
unions and resulting strike threats. Despite its successes, however, the communication sys-
tem would not have worked without PizzaExpress’ commitment, which was fundamental
in gaining staff commitment to the process. As James Sydmonds, the national forum rep-
resentative for Café Pasta, said, ‘When I started on the forum, I was very suspicious … Every
time I got to a different level and an issue was brought up, I’d think: “What is actually going
to happen at the next level?” But the company involvement has surprised me, and I have
been so impressed that I have wanted to get more involved and spread the gospel’.
Derived from Cooper (2001), Goymour (2000).
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(EWCs) and national works councils. The Directive establishing EWCs was
adopted in September 1994. It was not though till 2000 that the Directive was
finally implemented in the UK. The Directive covers all companies with a presence
in more than one EU Member State and with at least 1000 employees in total, of
which at least 150 are located in each of two EU Member States (CIPD, 2006).
Importantly, companies do not automatically have to establish a EWC, though both
companies and employees (or their representatives) can trigger mechanisms to
request a EWC (LRD, 2006). The voluntary nature of EWCs means that of the more
than 2000 companies covered by the Directive only around a third have established
EWC arrangements (CIPD, 2006). Within tourism and hospitality Lucas (2004)
notes that a relatively small number of companies have introduced EWCs, a num-
ber of whom were headquartered in Europe (and see HRM in practice 10.7).
In addition to EWCs the EU parliament also adopted the information and con-
sultation of Directive in March 2002, which was implemented in the UK as the
Information and Consultation of Employees Regulations 2004 (ICE Regulations).
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 236
HRM in practice 10.7 Club Med
Club Med is a French company and one of the world leaders in holiday villages. The com-
pany operates in over 40 countries and has more than 20000 employees. Club Med intro-
duced its EWC in September 1996, though prior to this date the company had previously
worked with unions to resolve issues such as re-employing seasonal staff and helping non-
French nationals to settle into working in France. Initially the EWC agreement was signed
for a period of 3 years, though in 1999 the agreement was renewed indefinitely.
Employee representatives are provided by the trade unions, both at a European level and
for several individual countries in which Club Med operates. The EWC allows for the pro-
vision of information, reflection and consultation between the partners. Information
provided through the EWC encompasses economic and financial matters, strategic per-
spectives, the employment situation, organizational changes and their consequences. In
difficult times, such as the post-9/11 period, the process of consultation allowed the EWC
to engender consensus on issues such as restructuring in what were difficult circum-
stances. In sum, the Club Med EWC is suggested as having several benefits including:
effective joint action during restructuring programmes with an impact on employment;
production of ethics guidelines on sub-contracting to support local conflicts; and
exchanges on strategic orientations or organizational changes within the group.
Source: EFILC (2005).
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The Directive required Member States to ensure that employers are under an
obligation to consult with their workforce on an ongoing basis in order that
employees have a better idea of potential changes in their employment. As was
noted earlier these types of arrangements are common in many parts of Europe,
though much less so within the UK context. For example, if we take JCCs as a
rough proxy for the sort of mechanisms required by the ICE Regulations then
WERS 2004 found that JCCs were present in 14 per cent of all UK workplaces,
though this varied markedly between size of the workplace, with the figures being
26 per cent in workplaces with 50–99 employees and 47 per cent in those with
100–199 employees (Kersley et al., 2006). From April 2005 the ICE Regulations
applied to companies with more than 150 employees, though it will cover those
with at least 100 from April 2007 and those with at least 50 from April 2008. Under
the terms of the ICE Regulations employees will have the right to be (LRD, 2004b):
? Informed about the organization’s economic situation.
? Informed and consulted about its current employment situation and employ-
ment prospects.
? Informed and consulted about decisions likely to lead to major changes in con-
tractual decisions or work organization. This could cover a range of topics includ-
ing working time and practices, training, equal opportunities and pensions.
Employers covered by the ICE Regulations will not automatically have to inform and
consult with employees, and indeed some employers may have pre-existing arrange-
ments that are considered acceptable. In workplaces without any existing arrange-
ments employees can make a request for the establishment of information and
consultation procedures. As long as 10 per cent of employees support such a request
the employer then has to provide a mechanism for information and consultation
(IDS, 2005). At the time of writing it is too early to say what effect the ICE Regulations
are likely to have in the long term. However, it does seem set to continue the trend
of Europeanization of employee relations activities in the UK, though whether this
ultimately leads to real social partnership and dialogue remains to be seen.
Conclusion
In this chapter we recognized that whilst there may be broad agreement on the
principle of ensuring that employees have a voice in managerial decision-making
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 237
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the form of influence will vary enormously. In some institutional contexts the
voice may be provided by trade unions. This is especially true for a number of
European countries where the principle of social partnership ensures that unions
play an active part in organizational decision-making. In the UK though it is more
likely that within the tourism and hospitality sector that employee influence will
be sustained through a variety of involvement and participation mechanisms.
There is much debate as to the efficacy – in relation to issues like improving
employee morale and raising productivity – and democratic intent of employee
involvement, and particularly the extent to which the various initiatives represent
‘pseudo-participation’ in their lack of a challenge to the managerial prerogative.
On the other hand it remains to be seen whether the representative approaches
which are now increasingly encouraged through a number of European Directives
will provide the meaningful participation that is intended. Ultimately approaches
to employee involvement and participation should aim to promote improved dia-
logue in the workplace. Workplaces that involve and engage their employees in
matters that effect their employment experience are likely to benefit through
increased commitment and motivation; something that social partnership seems
to have achieved in a number of European contexts and from which lessons can
seemingly be drawn by UK companies.
References and further reading
Aslan, A. and Wood, R. (1993) ‘Trade unions in the hotel and catering industry: the views of hotel man-
agers’, Employee Relations, 15(2), 61–70.
Baldachino, G. (1995) ‘Total quality management in a luxury hotel: a critique of practice’, International
Journal of Hospitality Management, 14(1), 67–78.
Baum, T. (2006) Human Resource Management for Tourism, Hospitality and Leisure: An International
Perspective, Thomson Learning.
BBC (2005) ‘Gate Gourmet settlement reached’, at http://news.bbc.co.uk/1/hi/business/4284858.stm
(accessed 6 July 2006).
Bernhardt, A., Dresser, L. and Hatton, E. (2003) ‘The coffee pot wars: unions and firm restructuring in the
hotel industry’, in E. Appelbaum, A. Bernhardt and R. J. Murnane (eds.) Low Wage America, Russell Sage
Foundation, 33–76.
Blyton, P. and Tunbull, P. (2004) Dynamics of Employee Relations, Palgrave MacMillan, 3rd edition.
Chartered Institute of Personnel and Development (2005) What is Employee Relations?, CIPD.
Chartered Institute of Personnel and Development (2006) European Works Councils Factsheet, CIPD.
Clark, A. (2003) ‘Conflict and confrontation in the air’, Guardian, 24 July, 5.
Cooper, C. (2001) ‘Talking Italian’, People Management, 14 June, 38–41.
Department of Trade and Industry (2006) Trade Union Membership 2005, DTI.
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 238
Ch10-H6572.qxd 11/22/06 5:53 PM Page 238
European Foundation for the Improvement of Living and Working Conditions (EFILC) (2005) ‘EWC Case
Studies: Club Med’, at http://www.eurofound.eu.int/pubdocs/2005/7140/en/1/ef057140en.pdf (accessed
12 July 2006).
Fox, A. (1966) ‘Industrial sociology and industrial relations’, Royal Commission Research Paper No. 3, HMSO.
Fox, A. (1974) Beyond Contract: Work, Power and Trust Relations, Faber.
Gall, G. (2004) ‘British employer resistance to trade union recognition’, Human Resource Management
Journal, 14(2), 36–53.
Gennard, J. (2002) ‘Employee relations public policy developments, 1997–2001: a break from the past?’,
Employee Relations, 24(6), 581–594.
Goymour, D. (2000) ‘Let’s talk’, Hospitality, May, 28.
Hales, C. and Klidas, A. (1998) ‘Empowerment in five star hotels: choice, voice or rhetoric?’, International
Journal of Contemporary Hospitality Management, 10(3), 88–95.
Hope, C. and Muhlemann, A. (1998) ‘Total quality, human resource management and tourism’, Tourism
Economics, 4(4), 367–386.
Hyman, J. and Mason, B. (1995) Managing Employee Involvement and Participation, Sage.
Income Data Services (2003) Suggestion Schemes, IDS Studies No. 752, June.
Income Data Services (2004) Employee Attitude Surveys, IDS Studies No. 777, July.
Income Data Services (2005) Information and Consultation Arrangements, IDS HR Studies No. 790, January.
Industrial Relations Services (2005a) ‘Evolution, not revolution – the changing face of the workplace’, IRS
Employment Review, No. 832, 30 September, 8–15.
Industrial Relations Services (2005b) ‘Dialogue or monologue: is the message getting through’, IRS
Employment Review, No. 834, 28 October, 8–16.
International Labour Organization (2001) Human Resource Development, Employment and Globalization
in the Hotel Catering and Tourism Sector, ILO.
Jones, C., Nickson, D. and Taylor, G. (1997) ‘Whatever it takes? Managing “empowered” employees and
the service encounter in the international hotel industry’, Work, Employment and Society, 11(3),
541–554.
Kersley, B., Alpin, C., Forth, J., Bryson, A., Bewley, H., Gix, G. and Oxenbridge, S. (2006) Inside the Workplace:
Findings from the 2004 Workplace Employment Relations Survey, Routledge.
Klidas, A. (2002) ‘Employee empowerment in the European cultural context: findings from the hotel indus-
try’, paper to the CRANET 2nd International Conference on Human Resource Management in Europe:
Trends and Challenges, Athens.
Knox, A. and Nickson, D. (2007) ‘Regulation in Australian hotels: is there a lesson for the UK?’, Employee
Relations, 29, 1.
Labour Research Department (2004a) ‘What do young people know about unions’, Labour Research,
March, 17–19.
Labour Research Department (2004b) ‘Be organized, be consulted’, Labour Research, November, 17–19.
Labour Research Department (2006) Law at Work, LRD.
Lashley, C. (2001) Empowerment HR Strategies for Service Excellence, Butterworth and Heinemann.
Lucas, R. (2004) Employment Relations in the Hospitality and Tourism Industries, Routledge.
Macaulay, I. and Wood, R. (1992) ‘Hotel and catering industry employees’ attitudes towards trade unions’,
Employee Relations, 14(2), 20–28.
Marchington, M. and Wilkinson, A. (2005) ‘Direct participation and involvement’, in S. Bach (ed.)
Managing Human Resources: Personnel Management in Transition, 4th edition, Blackwell, 398–423.
Morgan, O. (2003) ‘Swipe strike costs BA £50m’, Observer Business Section, 27 July, 1.
EMPLOYEE RELATI ONS, I NVOLVEMENT AND PARTI CI PATI ON 239
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Nickson, D. (1999) A Review of the Internationalization Strategies of Three Hotel Companies with a
Particular Focus on Human Resource Management, unpublished PhD Thesis, University of Strathclyde.
Red Pepper (2004) ‘Red Pepper’s 10th Anniversary’, press release at http://www.redpepper.org.uk/Press/x-
press-May2004.html (accessed 14 January 2006).
Riley, M. (1996) Human Resource Management in the Hospitality and Tourism Industry, 2nd edition,
Butterworth-Heinemann.
Salamon, M. (2000) Industrial Relations – Theory and Practice, 4th edition, Prentice Hall.
Sisson, K. (2005) ‘Responding to Mike Emmott: What “industrial relations” suggests should be at the heart of
“employee relations”’, at http://buira.org.uk/component/option,com_docman/Itemid,/task,doc_
download/gid,2/ (accessed 5 July 2006).
Townsend, M. (2005) ‘BA makes a meal of sari strike’, The Observer, 14 August, 15.
Turnbull, P., Blyton, P. and Harvey, G. (2004) ‘Cleared for take-off? Management–labour partnership in the
European civil aviation industry’, European Journal of Industrial Relations, 10(3), 287–307.
Visser, J. (2006) ‘Union membership statistics in 24 countries’, Monthly Labor Review, January, 38–49.
Wilkinson, A. (1998) ‘Empowerment: theory and practice’, Personnel Review, 27(1), 40–56.
Wills, J. (2005) ‘The geography of union organizing in the low-paid service industries in the UK: lessons
from the T&G’s campaign to unionize the Dorchester in London’, Antipode, 37(1), 139–159.
Websites
The Trades Union Congress website gives a sense of their views on a range of employment and political
issues http://www.tuc.org.uk
There are a number of case studies concerning employee participation in European companies at
http://www.eurofound.eu.int/areas/participationatwork/index.htm
The hospitality, leisure, sport and tourism support network has a useful guide to empowerment, involvement
and participation at http://www.hlst.heacademy. ac.uk/resources/guides/empowerment.html
http://www.ilisimatusarfik.gl/eng/index_eng-filer/index_eng.htm is an international site with links to many
organizations involved with employee participation and involvement.
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Chapter 11
Welfare, health and
safety
Chapter objectives
This chapter considers the range of issues
concerned with the development of welfare
policies in tourism and hospitality. Recognizing the
ethical, legal and business aspects of welfare this
chapter aims to:
? Appreciate the differing rationales for
developing welfare policy.
? Consider the balance between the public and
private life of organizational members.
? Recognize the increasing business emphasis in
the development of welfare policies.
? Assess the extent to which welfare issues are
particularly resonant within the tourism and
hospitality industry.
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 242
Introduction
Every year thousands of people suffer serious injury or even death in the work-
place. Many more suffer from work-related illnesses or are absent from work due
to work-related stress. In order to alleviate dangers in the workplace and ensure
that employees are working in a healthy or happy environment it is essential that
tourism and hospitality organizations consider the development of appropriate
welfare policies. Goss (1994: 122) recognizes how, ‘Welfare provision generally
refers to those policies which are directed at some aspect of employee well being,
both in a physical and emotional sense.’ Torrington et al. (2005) suggest that the
physical aspects of a broader welfare policy stem from measures to improve health
and safety in the workplace, as well as issues such as the provision of paid holi-
days and reduced working hours. From an emotional/psychological perspective
organizations are likely to be concerned with the mental well being of their
employees, or more broadly anything involving the ‘human relations’ needs of
people at work. Of course, in reality there is a degree of interconnectedness
between physical and mental aspects of welfare, though it is also important to con-
sider the potential distinctions that may be made between them.
From the above discussion we might ask ourselves why should organizations
have a welfare policy and indeed whether the subject of the more sensitive aspects
of welfare-related issues should remain personal and private. To answer these
questions we should recognize various reasons for the existence of welfare pol-
icies. Goss (1994) suggests that organizations have usually developed welfare pro-
vision within the paradigm of three common ‘welfare rationales’, these being:
legal-reactive, corporate conscience and company paternalism and these are now
briefly discussed.
? Legalistic-reactive: In this approach an organization’s approach to welfare policy
is primarily driven by legislative requirements, for example responding to
health and safety legislation. With such an approach the organization does not
see developing welfare policy as an important part of its core objectives but
rather something that has to be complied with.
? Corporate conscience: Here, Goss notes how historically the role of personnel had a
strong welfare orientation and, arguably, how over time this welfarist approach
became increasingly seen as ‘soft’ and ‘indulgent’, especially within a more com-
petitive business environment.
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WELFARE, HEALTH AND SAFETY
? Company paternalism: This approach is concerned with the ‘fatherly’ manner in
which organizations would seek to look after all aspects of their employees
lives. By taking an ‘encompassing’ approach, company’s that practiced com-
pany paternalism would be concerned not only with the immediate work envir-
onment, but the manner in which employees lived their lives outside of work.
Underpinning company paternalism is a strong sense of religious and moral
commitment and employees would be expected to lead a live which fitted with
this ethos (see also Nickson (1997) for a description of company paternalism in
the Marriott, Hilton, Holiday Inn and Forte organizations).
In many respects the above description of differing welfare rationales has a clear
overlap with some of the discussion in Chapter 6 on equal opportunities. In the
earlier chapter on equal opportunities the question was considered as to whether
organizations should develop policies due to legal, ethical or business aspects and
the same arguments can be made with regard to the welfare of employees. Clearly
within this discussion the legal dimension is one that cannot be ignored and this
aspect will be a concern throughout the chapter. To an extent the notion of corpor-
ate conscience and company paternalism would seem to rest more on an ethical
view of welfare. Increasingly though it is argued that the main argument for develop-
ing welfare policies is from the point of view of the HRM business case/efficiency
argument. Much of this discussion about adopting a more efficient approach to
welfare is generally seen through the lenses of savings costs by reducing absence
and improving the performance of employees in the workplace by addressing any
problems or concerns that they might have. Clearly then welfare is an important
topic, which may conceivably cover a variety of different issues. In this sense we
can think of a welfare ‘alphabet’, encompassing a range of issues, such as: absence
management, AIDS/HIV, alcohol/drug misuse, smoking, stress, working time
and workplace violence. These aspects are now considered.
Absence management
Increasingly organizations are attempting to take a more proactive approach to the
management of absence, recognizing both its direct and indirect costs. With regard
to direct costs IDS (2005a) note how absence can be a significant drain for organ-
izations in terms of the cost of occupational sick pay, lost production or the need to
243
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 244
bring in replacement staff. CIPD (2005a) note that 9 out of 10 organizations report
that absence is a ‘significant’ or ‘very significant’ cost to the business. Overall, the cost
of absence to the UK economy is £11 billion (Simms, 2005), and more specifically
CIPD (2005a) notes how the cost per employee is £601 (see HRM in practice 11.1).
More indirectly, and less easy to quantify, absences may place burdens on other
organizational members, leading to poor morale, lower productivity, reduced cus-
tomer retention and profitability (IRS, 2001; IDS, 2005a). In the CIPD (2005a) annual
survey of rates of sickness absence hotels, restaurants and leisure had an absence
rate of 3.2 per cent and on average employees took 7.3 days off sick. In comparing
these figures to other sectors, hospitality and tourism has higher absence rates than
private services generally (3.0 per cent and 6.8 days), yet compares favourably with
the economy as a whole (3.7 per cent and 8.4 days). There is also the vexed issue of
whether sickness absence is ‘genuine’. The absence survey by the CIPD (2005a) sug-
gested that 14 per cent of absence across the economy as a whole is not genuine.
Indeed, a previous survey conducted in 2004 by the Confederation of British
Industry found a similar figure (15 per cent), whilst also noting that retail and dis-
tribution, hotels and restaurants were amongst the sectors with the highest levels of
non-genuine absence (respectively, 21 per cent and 19 per cent) which arguably
points to underlying employment and HRM-related problems (IRS, 2004b).
CIPD (2006a) notes that in broad terms there are two types of absence, short
term and long term – defined as 10 days or more (Simms, 2005). Short-term sick-
ness absence will usually be uncertificated, self-certificated or covered by a doctor’s
note. For longer-term absence there may be a need to involve occupational health
professionals or utilize rehabilitation programmes in order to get the employee
HRM in practice 11.1 The UK: The sick man
of Europe?
IRS (2004a) reports recent research by the European Union (EU) which suggests that the UK
has a particularly poor health record with more than one in four working age adults having
a long-term health problem. This figure was second only to Finland (32.2 per cent) and
higher than direct competitors such as Germany (11.2 per cent), France (24.6 per cent) and
Holland (25.4 per cent). The lowest figures in the survey were Romania (5.8 per cent) and
Italy (6.6 per cent). For those actually in employment, the UK again has one of the highest
rates of employees suffering long-term health problems at 20.4 per cent (surpassing only
Finland and France), compared to the EU average of 12.7 per cent.
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back to work (CIPD, 2006a), though this may be more likely in larger organizations
(IRS, 2004b). There are a number of causes of absence, though the most prevalent
is usually minor illness, such as colds or flu. Other reasons for absence include
aspects such as back pain, musculo-skeletal injuries, stress, mental ill health and
recurring medical conditions (CIPD, 2005a).
Regardless though of the nature of the absence and whether it is short or long
term increasingly it is suggested that there is a need for organizations to adopt a more
proactive approach, especially if the costs described previously and so-called non-
genuine illness are taken into account. For example, it is suggested that organizations
are making progress in measuring absence and taking specific steps to address the
most obvious causes. Though it is also important that such an approach is seen as
part of a broader integrated approach to create a healthy, high-quality workplace,
where the link between employer performance and employee satisfaction is clearly
understood. At the least though the organization should have a basic sickness
absence policy, which should aim to (CIPD, 2006a: 3):
? Provide details of contractual sick pay terms and its relationship with statutory
sick pay.
? Outline the process employees must follow if taking time off sick – covering
when and whom employees should notify if they are not able to attend work.
? Include when (after how many days) employees need a self-certificate form.
? Contain when they require a medical certificate (sick-note) from their doctor to
certify their absence.
? Mention that the organization reserves the right to require employees to attend
an examination by a company doctor and (with the employee’s consent) to
request a report from the employee’s doctor.
? Include the provision for return-to-work interviews as these have been identi-
fied as the most effective intervention to manage short-term absence.
HRM in practice 11.2 notes an attempt by British Airways to take a more proactive
approach to managing absence, which amongst other things demonstrates the
importance of training line managers to become involved in the process of man-
aging absence.
In an even more proactive vein some companies are also moving towards
using a new trend imported from the US, that of ‘wellness’ or health management
at work, which may be particularly apposite in those leisure-oriented sub-sectors
of the tourism and hospitality and is considered in HRM in practice 11.3.
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 246
HRM in practice 11.2 Tackling absence at
British Airways
British Airways had previously had real problems with levels of absence in the company. In
2002, the company acknowledged the scale of the problem by choosing to go ‘loud,
proud and wide’ on the issue. By October 2004, the average absence per employee was
16.7 days per year, well above the sectoral average. Around 90 per cent of this absence
was short term and the overall cost to the company was put at £70 million. It was at this
time that British Airways introduced a new absence management policy, which developed
a single set of clear absence policies and procedures for all staff. The aim of the new
approach was to reduce absence by March 2006 to an average of ten days per employee,
thus saving the company an estimated £30 million annually. As Peter Holloway, British
Airways head of people and organizational development, recognizes, ‘absence manage-
ment is not fun, sexy or exciting; it is about day to day following through of simple man-
agement practices’. Recognizing this point, amongst other things the new policy sought
to encourage regular attendance at work, promote early intervention from line managers
and HR managers and provide support for those with legitimate reasons for absence with
the intent of assisting their return to work at the earliest opportunity. Resultant policy
interventions included employees having to have a conversation with their line manager
as soon as possible regarding the nature of their absence and a standard informal return-
to-work discussion after every occasion of absence. There was also a tightening of
absence recording mechanisms, which are now done electronically. Line managers were
also tasked with taking a more active role in absence management and ‘triggering’ an
‘absence review interview’, a more formal version of the return-to-work interview. The
absence review interviews are triggered if an employee is absent more than twice in
3 months or takes more than 10 consecutive days off. When conducting the absence
review interviews managers have a degree of discretion in considering the personal cir-
cumstances of the employee and aspects such as the Disability Discrimination Act.
Although there were some teething problems with the new policy, especially in terms of
the manner in which line managers applied discretion and some inconsistency in interpre-
tation of the new rules, the policy appears to have been very successful with the company
suggesting that employee absences are now around 8 days per employee.
Derived from IDS (2005a); Simms (2005).
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In sum, organizations are increasingly seeking to adopt more proactive
approaches to absenteeism. In part, this approach can be achieved by inte-
grated absence management approaches which look to address short- and long-
term absences and importantly also recognizes the potential for underlying causes
for absence that may be explicable by broader HRM failings.
AIDS/HIV
AIDS, which stands for Acquired Immune Deficiency Syndrome, was first diag-
nosed in 1981. It is caused by the human immunodeficiency virus (HIV) which
attacks the body’s natural defence system and leaves it open to various infections
and cancers. Worldwide there are now nearly 40 million people with HIV, many of
them in sub-Saharan Africa (MacAskill, 2006). Within North America, Western and
Central Europe the figure stands at 3.5 million (MacAskill, 2006). Currently,
approximately 10 per cent of known HIV-positive individuals have developed
AIDS (ACAS, 2006). Importantly, many people who are HIV positive are well most
of the time, but develop some minor symptoms such as swollen lymph glands. In
this sense HIV infection alone does not affect people’s ability to do their job, at
least until employees develop illnesses that may make them unfit for work. Till
that point there is no reason why someone who is HIV positive cannot continue to
WELFARE, HEALTH AND SAFETY 247
HRM in practice 11.3 Prevention is better
than cure
Manocha (2004) recognises how wellness management seeks to adopt a proactive
approach in creating a healthy organization. It aims to help employees to look and feel
better and to be physically healthy or fit. The emphasis is less on managing employees
when they get sick, but instead seeks to manage healthy employees so they do not get
sick. Such initiatives are likely to be part of a broader package of HRM policies which aim
to create a great place to work. Wellness is likely to be facilitated by aspects such as a gym
on site in the workplace and the provision of expert advice in areas such as nutrition.
Employers adopting a wellness programme are also likely to measure the results of such
an approach by monitoring aspects such as employees’ heart rate, blood pressure, chol-
esterol and body weight.
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work normally as long as they are fit to do so. Moreover a person who is HIV posi-
tive is no real danger to others at work in that transmission during normal work-
ing activities is virtually impossible.
It is difficult to be definitive in terms of identifying the number of people who
may be HIV positive or have AIDS within the workplace. Ladki (1994) notes that
96 per cent of those diagnosed with AIDS in the United States were in their prime
employment years (20–64 years). Similarly, Breuer (1995), again writing in the US
context, suggests that 1 in 300 employees may be HIV positive or have AIDS; and
that 90 per cent of HIV infected Americans are in the workplace. Clearly then
AIDS/HIV is something that organizations have to respond to as a major environ-
mental feature, for example with regard to aspects such as employee education
and understanding the legal implications of how best to respond to employees
who are HIV positive. AIDS then presents a major managerial challenge encom-
passing moral, social and medical issues resulting from health, safety, legal and
humanitarian problems (Arkin, 2005). Consequently, as Bratton and Gold (2003:
172) note, ‘a textbook on human resource management for the next millennium
would be incomplete if no reference were made to society’s most recent menace.’
Indeed, it may well be that these sentiments have a particular resonance
within the tourism and hospitality industry for a number of reasons including
(Adam-Smith and Goss, 1993):
? Age composition and accommodation arrangements: Many organizations within the
sector rely to a great extent on young workers. This is the group in society per-
ceived to be at the most risk of infection through high-risk behaviour, whether that
be drug abuse or unprotected sex. For example, most of those infected with HIV
are in the age groups that have the highest level of economic activity, thus half of
all know infections are in those between the ages of 15–24 years (Goss, 1997). It is
also possible that there is a greater concentration of high-risk behaviour when
many young workers are living together in shared accommodation, or working in
a potentially sexually charged environment (see HRM in practice 11.4).
? Perceived high concentration of homosexual males working in the industry: Despite
research suggesting that this group has now changed their sexual practices there
may be a number who were affected before the risks became apparent.
? The nature of the work in certain sub-sectors, such as working in kitchens and res-
taurants: Here, there may be a very slightly greater risk of infection than in other
workplaces. For example, blood being transmitted through accidents in the
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kitchen or hypodermic needles being found in hotel bedrooms or clubs/discos
and the risk of blood contact through violent encounters.
? Sensitivity to public fears: Despite medical advice to the contrary the public may
feel that there is a significant risk of HIV being transmitted through food and in
the 1990s employers in the American restaurant industry saw AIDS as the num-
ber one long-term issue facing the industry (Ladki, 1994).
Much of the above discussion points to the need for a considered managerial
response. Before we move on to discuss this point further first of all consider the
issues outlined in HRM in practice 11.5.
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HRM in practice 11.4 Sexual activity in the
tourism industry
Guerrier and Adib (2004) in their study of tour reps in Mallorca found that male reps in
particular where much more likely to instigate sexual relations with customers. Often
these approaches and liaisons would take place after organized night outs where male
reps were also more than likely than female reps to drink with customers. Guerrier and
Adib recognize that for the male tour reps engaging in this type of behaviour was an
attempt to reinforce their masculine identity, which they suggest is especially important
in feminized environments when it may be in doubt.
HRM in practice 11.5 Responding to sensitive issues
Read the following scenarios:
A member of staff in your travel agency comes to you and informs you that they are HIV
positive. How do you react?
A male cook who works in your restaurant kitchen is quite open about the fact that he
lives in a homosexual relationship. Most of the other people in the kitchen are aware of
this. One day a rumour is started that he is HIV positive. Despite this rumour being untrue
very quickly a number of his colleagues have been to see you to ask for him to be dis-
missed. How do you handle this situation?
Review and reflect: How, as a manager, would you respond to these scenarios?
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Having considered your response to these scenarios now consider HRM in prac-
tice 11.6 which outlines how one organization dealt with a very similar problem.
HRM in practice 11.6 illustrate the need for a clear and sensible approach to
managing AIDS/HIV, though some of the difficulties in developing such an
approach are nicely encapsulated by the view of one manager quoted in Bratton
and Gold (2003: 172) who recognizes that, ‘I was not trained to manage fear, dis-
crimination, and dying in the workplace.’ Much of the discussion above stems
from potential misinformation about the nature of AIDS/HIV and in particular the
notion of perceived risk of infection. Adam-Smith and Goss (1993) identify three
potential responses to the perceived risk of infection in the workplace.
? Rational response: In this response individuals fully understand the probability of
risk and on this basis make an informed choice about the acceptability of working
with somebody who is HIV positive. As we have already noted the risk of trans-
mission in a normal workplace situation is minimal and as long as employees are
aware of this point then their rational response is such that they would have little or
no fear of contracting the disease or working with somebody who is HIV positive.
? Bounded rationality response: In this response individuals are likely to view the
issue on the basis of factually incomplete or incorrect information, often leading
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HRM in practice 11.6 Public misperceptions
about AIDS
Barrows et al. (1996) report how a well-known Californian restaurant, Bon Appetit, found
that its business was seriously affected when news emerged that a former employee had
died of AIDS. Customer counts declined significantly when the media released a story that
an executive chef who had previously worked in the restaurant had died of AIDS. The
owner of the restaurant, Ralph Granthem, chose to take a proactive response to the situ-
ation by holding a press conference, where he recognized the overwhelming medical evi-
dence that suggests that AIDS is not transmitted by food handling. Greater clarity was also
offered by a well-publicised visit from the Director of the California Department of Health
Services. Along with his wife the Director ate in the restaurant and also produced a state-
ment recognizing that people do not get AIDS from restaurants. By taking a proactive
approach the restaurant was able to reverse the decline in business, but the case illustrates
the possibility for uninformed public responses to AIDS.
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to a misunderstanding of the degree of risk. Consequently, employees may
overemphasize the perceived hazard of AIDS/HIV and for example refuse to
work with a fellow employee who is HIV positive because of an inflated sense
of risk.
? Subjective response: This response is largely driven by moral or subjective beliefs
that determine the level of acceptability of working with somebody who is HIV
positive. For example, somebody who is homophobic may see AIDS/HIV as
being a disease that is ‘self-inflicted’ and refuse to work with a homosexual col-
league who is HIV positive.
Adam-Smith and Goss recognize that in reality, ‘individuals are likely to use a com-
plex mix of these decision-making processes in their assessment of risk’ (p. 28).
Furthermore the organizational context will also be important in determining
employees’ assessment of risk, a point we touched on earlier.
Policy responses to AIDS/HIV
To a large extent the discussion above also points to the manner in which organ-
izations can develop a response to the issue of AIDS/HIV, which can take one of
several forms:
? Total denial that AIDS/HIV is a workplace issue.
? Wait and see approach.
? Deliberate no-policy decision and reliance on existing arrangements.
? AIDS/HIV to be treated as any other life-threatening disease.
? Introduce specific policy.
Given much of the discussion above a more proactive response seems appropriate.
In this way the reasons for having a policy include things like countering misun-
derstanding, lack of knowledge, fear and prejudice. Although ostensibly there is
no statutory obligation for such a policy, the designation of HIV under the
Disability Discrimination Act, wherein someone with HIV is deemed to have a dis-
ability, means that organizations should be proactive, particularly with regard to
the notion of making ‘reasonable adjustments’ to address progressively disabling
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conditions. In developing a policy there are a number of aspects organizations can
consider as being integral to a successful policy, including (e.g. see IRS, 1997;
ACAS, 2006):
? Ageneral statement of the company’s commitment to non-discrimination.
? Affirmation of usual hiring procedures so there is no discrimination in recruit-
ment against applicants on the grounds that they are HIV positive or have
AIDS.
? Assurance of continued employment.
? Employees who are HIV positive will be redeployed to alternative employment
at their own request and will not be prevented from continuing work, except
where they are deemed ‘medically unfit’ through the standard procedures.
? Equitable benefits.
? Guarantee of medical confidentiality.
? Access to employee assistance programmes (EAPs), for example counselling
services.
? Astatement that individuals who refuse to work normally with people with AIDS
or who are HIV positive will be interviewed to find out the circumstances of their
refusal and if appropriate dealt with under the organization’s disciplinary proce-
dure.
? Arrangements for staff who travel overseas.
Apolicy such as that suggested above may also be developed in conjunction with an
education programme to ensure that all employees are fully aware of AIDS/HIV
and particularly the lack of any real risk in normal workplace situations.
Alcohol/drug misuse
Drink- and drug-related problems are one of the commonest causes of sickness
absence in the workplace. Figures suggest that in the UK one in three men and one
in five women drink over the recommended limits (IDS, 2005b) with 1 in 13 Britons
said to be dependent on alcohol (BBC, 2003). The result is that for those drinking
over the recommended number of units (21–28 for men; 14–21 for women) are
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twice as likely to take sick leave (IDS, 2005b). It is estimated that alcohol-related
sickness or illness costs UK employers around £6.4 billion, with up to 17.4 million
working days lost in 2003 (Roberts, 2003). Moreover research from Alcohol
Concern suggests that one in four accidents at work are due to alcohol misuse
(TUC, 2003). Across the EU it is estimated that the cost of lost productivity through
absenteeism, unemployment and lost working years through premature deaths
resulting from alcohol abuse is €59 billion a year (Institute of Alcohol Studies,
2006). Similarly, research in the US has suggested that workplace alcohol use and
impairment affects approximately 15 per cent of the workforce (Alcohol Concern,
2006). Problem drinkers are also absent from work in the US, on average, 22 days
per year and are twice as likely as non-alcohol drinkers to have accidents at work
(Corsun and Young, 1998). Whilst problem drinking is a significant workplace
concern the same is also true for drug misuse. In 2004, a third of British workers
under the age of 25 years took illegal drugs in the previous year, with the figure
being 1 in 10 for all workers (IDS, 2005b). Drug abuse costs British industry around
£800 million a year (Hilpern, 2001). In the US one in four workers either has used
or knows someone who uses illegal drugs and it is suggested that drug abuse costs
US business $60 billion annually (Eade, 1993).
Therefore the direct and indirect of alcohol and drug abuse can be seen in a
number of ways, such as costs of accidents, lower productivity, poor quality work,
bad decisions, damage to the organization’s reputation, absenteeism and unrelia-
bility, managers losing time in dealing with problems and increased labour
turnover. Many argue that alcohol and drug misuse has a particular resonance in
the tourism and hospitality. For example, the industry is often suggested as being
fast paced and having a ‘work hard, play hard’ culture where employees may
unwind with alcohol or drugs. In addition, other factors that create an environ-
ment which arguably encourages alcohol and drug abuse include:
? Long working hours.
? Sociability of the workplace.
? Availability of alcohol in the workplace, and often the expectation that employ-
ees will drink as part of their employment.
? Stress, for example employees having to sustain emotional labour so that even
during stress-inducing encounters with customers, employees are expected to
be positive, friendly, cheerful and helpful.
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Reflecting the above discussion it is unsurprising to find that hospitality and
tourism workers have been identified as particularly at risk with regard to alcohol
and drug abuse. For example, a recent survey of 1000 hospitality professionals
found that 40 per cent of respondents had seen colleagues take illegal drugs while at
work, with 59 per cent noting how they had seen colleagues drinking to excess on
duty (Bignold, 2003). Similarly, publicans top the list of liver cirrhosis mortality with
other hospitality occupations, such as cooks and kitchen porter and caterers not far
behind (Mullen, 2001).
Developing policy on alcohol and drugs
On the question of a policy it is worthwhile initially considering the extent to
which employers can seek to intervene in something that may be taking place out-
side the workplace. As we noted earlier, in developing welfare policies there may
be times when employers are intervening in an employee’s private life outside the
organization. Proponents of the business case for welfare would argue that if an
employee attends work whilst still impaired through the use of alcohol or drugs
then it is likely to significantly affect their performance. Consequently they would
dismiss concerns as to the appropriateness of an employer taking an active inter-
est in an employee’s life outside of work.
Of course, within the workplace the issue is less ambiguous and employers
have a legitimate right to develop policies for alcohol and drug misuse. Afurther
issue which impacts on the development of such a policy is the difference between
alcohol and drugs in that rules on drugs at work are inevitably more stringent
because many drugs are illegal (IDS, 2004a). In terms of developing policy it is use-
ful to acknowledge the view of IDS (2004a: 10) who recognize that, ‘there is an
increasing trend towards treating long-term alcoholism and, to a lesser extent,
dependence on illegal drugs as serious illnesses’. When viewing alcohol and drug
misuse in this light the organization is likely to be supportive rather than punitive
and will encourage an employee who has a drink or drug problem to seek volun-
tary help, although this may be facilitated by establishing links with outside
organizations, such as those providing EAPs, who can provide expert advice and
support. That said, even supportive policies will also usually contain provision for
a more punitive approach if there is no improvement in the employee, for example
an employee may face disciplinary action and ultimately dismissal on the grounds
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of capability. Furthermore, IDS (2004a) also note that there may be circumstances
where an employee recklessly or even deliberately disregards company rules or
acceptable standards of conduct on alcohol and drugs where dismissal on the
grounds of misconduct may be acceptable. Within this context then an organiza-
tion’s alcohol and drug policy may contain the following (IDS, 2004a):
? Ageneral statement covering the background to the policy, including any legal
obligations.
? A clear outline of the aims and purposes of the policy, including the balance
between the discipline and support for employees.
? Details of the responsibilities of different staff and the training and guidance
available.
? Who is covered by the policy and if there are tighter restrictions for any par-
ticular groups.
? Rules and procedures around drug use, including definitions of what consti-
tutes alcohol and drug misuse and rules regarding prescription medicine.
? The disciplinary action that will be invoked following a policy breach, and what
the company’s stance is regards to misconduct relating to alcohol or drugs, but
not dependency.
? Information for employees on safe drinking limits, classes of drugs, the effects
of alcohol and drugs, and where to receive help.
? Details of how an employee can refer themselves for treatment, the support the
company will offer and what action the company will take if treatment is
declined, not completed or the employee relapses.
? Overview of any testing process, including an explanation of why tests are car-
ried out and when, who administers the tests and what happens if a test proves
positive or an employee admits to a dependency during the testing process (see
HRM in practice 11.7).
Review and reflect
To what extent do you agree that ‘peer pressure’ is likely to have more impact on changing
behaviour with regards to alcohol or drugs than organizationally directed interventions?
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Sexual harassment
Whilst definitions of sexual harassment are generally similar there may still be dif-
ferent perceptions as to what constitutes sexual harassment (see, for example, ILO
(1999) for a review of practices across a number of companies and countries).
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HRM in practice 11.7 Drug and alcohol testing:
An ethical or legal issue?
There are debates about the usefulness of drug and alcohol testing in the workplace,
with concerns being expressed about the moral, ethical and legal aspects of testing; and
particularly whether testing is the best way to address the problem of misuse. For example,
within the European context some argue that under the Human Rights Act 1998 random
testing impinges on an individual’s right to privacy. Where testing does take place there
are significant differences on who is likely to be tested, depending on aspects such as the
country and sectoral context. In the US it is suggested that around 70 per cent of com-
panies across all industries screen employees for illegal substances. More specifically,
research conducted in the 1990s in the hotel sector found that nearly 50 per cent of a
sample of 110 hotels conducted drug testing both for applicants for jobs and existing
employees. In the UK, the figure is much lower with some estimates suggesting it is as
low as 4 per cent. As well as the national differences there may also be differences in
terms of occupations. For example, jobs in industries which are considered ‘safety criti-
cal’ are much more likely to have testing on the job, this would include some parts of the
tourism industry, such as the airline industry. The British Airline Pilots Association
(BALPA), a trade union representing around 8000 pilots and cabin crew, have voiced con-
cerns about random testing of pilots, suggesting that this approach merely drives the
problem underground. Instead, their solution to alcohol and drug misuse is support via
‘peer pressure’. In this approach flight crew are encouraged to confront a colleague with
a problem and urge them to seek help. Evidence seems to suggest that this approach is
more successful in detecting the problem and helping individuals deal with it and has
recently been endorsed by the International Federation of Airline Pilots Association,
which represents pilots worldwide. The ferry and cruise ship industries also tends to
operate a strict ‘no-alcohol at work’ policy for both sea- and shore-based employees, and
will often randomly test on-board employees for alcohol or drugs.
Derived from Casado (1997); IRS (2002); Shanahan (2005).
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Before we move on to consider the substance of this statement first of all consider
HRM in practice 11.8.
In 2002, the Council of Ministers and European Parliament agreed the text on
a new directive on the equal treatment of women and men, which included a new
definition of sexual harassment. As of 1st October 2005 this new European wide
definition was introduced into law and suggests that sexual harassment is ‘any
form of unwanted verbal, non-verbal or physical conduct of a sexual nature
(which) occurs with the purpose of violating the dignity of a person, in particular
when creating an intimidating, hostile, degrading, humiliating or offensive envir-
onment’ (cited in LRD, 2005a: 21). Sexual harassment therefore is unwanted
behaviour which a person finds intimidating, upsetting, embarrassing, humiliat-
ing or offensive and in that sense is unique to the individual. The individual
nature of sexual harassment means that, at certain times, it may be rather sub-
jective and behaviour that one person may consider as acceptable could be seen as
harassment by another. For example, you may have indicated all of the aspects in
HRM in practice 11.8 as denoting sexual harassment, yet the next person might
have indicated something different. There is also the added complication that
increasingly many of us now meet our partners in the workplace, which means
that romantic conduct or romantic liaisons are increasingly evident in the work-
place. For example, according to IRS (2000), whilst the majority of UK employees
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HRM in practice 11.8 What constitutes sexual
harassment?
Consider the following list/scenarios and place a tick by what you would consider sexual
harassment:
Patting, hugging or touching a co-worker.
Comments about the way a women looks.
Lewd remarks or glances directed towards a male employee from a female employee.
Questions about an employees sex life.
Requests for sexual favours.
Allowing suggestive posters of either sex in the workplace.
Intimate physical contact within the workplace.
A manager begins a sexual relationship with one of his/her subordinates.
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disapproved of overt sexual activity in the workplace, the majority of survey
respondents were comfortable with flirting and almost 40 per cent were or had
been involved in workplace romantic or sexual relationships. This estimate is cau-
tious given that such relationships are often deliberately covert but is also con-
firmed by Kakabadse and Kakabadse’s (2004) recent international study of
romance in the workplace. With the workplace ‘becoming a common meeting
ground for romantic liaisons’ (Kakabadse and Kakabadse, 2004: 42) there is a need
to recognize the line between legitimate and accepted behaviour and that con-
sidered sexually harassing.
Where behaviour does err on the side of unacceptable it is usually women
who are worst affected by sexual harassment, although men can suffer as well.
Equally, there may be occasional cases of same sex harassment (Sherwyn et al.,
2000). Generally, though it is women who experience sexual harassment. For
example, the Industrial Society (now Work Foundation) produced a report in the
mid-1990s which suggested that 93 per cent of sufferers of sexual harassment were
women (Coupe and Johnson, 1999). Often it is a male superior who is the harasser.
Gilbert et al. (1998) note how two-thirds of sexual harassment complaints in the
largest companies in the US were made against immediate supervisors and upper
management. Moreover the extent to which sexual harassment is experienced is
widespread. IRS (1996), for example, reporting their own and other survey data
suggests that well over 50 per cent of women had suffered harassment at work.
More specifically, Worsfold and McCann (2000) reporting on the experience of 274
students on supervised work experience in the hospitality industry found that 156
(57 per cent) had experienced instances of sexual harassment.
Despite the fact that it is often viewed as a ‘joke’, ‘just a bit of fun’ or ‘a bit of
harmless flirting’, sexual harassment is, in reality, usually about the misuse of
power as well as being humiliating and degrading for the recipient and therefore
likely to effect confidence and job performance. It can also have a serious impact
on physical and mental health and lead to absenteeism. Clearly, then there are sev-
eral reasons why employers should take action to prevent sexual harassment.
Some of these may be pragmatic, such as protecting the company image and
avoiding litigation as the courts increasingly view the prevention of harassment as
the responsibility of the employer; some may be concerned with business aspects
such as reducing absenteeism. Arguably though the strongest argument lies in our
earlier identification of the ethical dimension of broader welfare policies. No
employee should have to suffer sexual harassment and the workplace should be
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a place where every employee has the right to be treated with dignity and not suf-
fer from harassing behaviour (ILO, 1999).
Tourism and hospitality: a breeding ground for sexual harassment?
It is important to realize that sexual harassment may be particularly prevalent in
the tourism and hospitality industry. For example, Coupe and Johnson (1999: 37)
note that, ‘Female employees within traditional service spheres of employment,
such as operative employees in the hospitality industry, will be extremely vulner-
able to sexual harassment’. Why is this the case? First, within the hospitality sub-
sector in particular there is the notion of many departments often being dominated
by a single gender, for example men in the kitchen (see HRM in practice 11.9).
A further issue is the extent to which tourism and hospitality organizations
may either tacitly or even deliberately exploit women’s sexuality. As Gilbert et al.
(1998: 49) note ‘the inherent characteristics of service organizations create a prime
breeding ground for sexual harassment’. Within tourism and hospitality many
accounts (e.g. Hall, 1993; Adkins, 1995; Tyler and Abbott, 1998) recognize the man-
ner in which some organizations may sanction sexuality as part of the performa-
tive aspects of their front-line employees. In this way tourism and hospitality
workplaces may be in Mano and Gabriel’s (2006) view ‘hot’ climates. Workplaces
which are considered ‘hot’ climates often have a high degree of aestheticization of the
WELFARE, HEALTH AND SAFETY 259
HRM in practice 11.9 If you can’t stand
the heat…
The kitchen is often felt to be a very masculine environment with a very macho culture,
which may lead to sexist attitudes being prevalent. It is suggested that to fit in employees
may have to swear, ogle pornography and generally act like men. Such an environment can
create attitudes where sexually harassing behaviour could be construed as just a ‘bit of a
laugh’. One female chef reporting on her experiences working in a kitchen notes several
incidences of sexual harassment, including a colleague having her trousers pulled down in
front of an all-male kitchen. She also notes the experiences of female chefs in the US where
sexism seems equally prevalent, for example one noting how she was routinely groped.
Derived from Packer (1998); Roche (2004).
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workplace which emphasizes the importance of appearance, style and sensuousness,
which in turn creates what Mano and Gabriel term a ‘sexual simmer’. Workplaces
which have this sexual simmer are also likely to encourage flirtation, sexualized lan-
guage, innuendo and an emphasis on appearance and image. This notion of certain
service workplaces being inherently sexualized is supported by Guerrier and Adib
(2000). In their study of sexual harassment of hotel workers they suggest a contribut-
ing factor is that hotels often suggest the promise of sexual activity:
The space of the hotel is laden with sexuality. In particular, the hotel’s func-
tion is sexualized. Hotel bedrooms provide a space for guests to engage in
sexual activity. The sexualization of the hotel space is reflected in the sexual-
ization of hotel workers. In many of the incidents of harassment in this study,
assumptions were made about the hotel workers and their roles as service
providers within a sexualized setting (p. 720).
Beyond the hotel sub-sector, Guerrier and Adib (2000, 2004) also note how other
tourism- and hospitality-related setting such as restaurants, airlines and working
in a resort as a tour rep are also inherently sexualized environments (see HRM in
practice 11.10).
As can be seen from the above discussion it is women who are more likely to
face sexualization and potentially sexual harassment. Adkins (1995) is one of sev-
eral authors who recognize how female employees have greater pressure from
tourism and hospitality organizations to sustain an ‘attractive’ or alluring appear-
ance. She reports how managers in the leisure organization she studied would
enforce uniform requirements which required that women would have their
dresses pulled down off the shoulder. Indeed, she even notes how male managers
would often physically pull down employees’ dresses into that position. In this
way potentially neutral dress and appearance standards are sexualized by man-
agerial action. Organizations may also encourage a degree of flirting in the inter-
action with customers and crucially alcohol consumption, indeed often excessive
consumption, is an integral part of many tourism and hospitality workplaces, fre-
quently loosening the tongues and morals of customers in particular. For example,
Hall (1993) notes the importance of ‘job flirt’ to the waiting staff she studied.
Taking part in such activities could potentially be gender neutral in that both men
and women might conceivably engage in this type of behaviour in the work setting.
Guerrier and Adib (2000) note how the restaurant chain TGI Fridays encourages both
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male and female waiters to flirt with customers to increase customer spend and their
own tips. Nevertheless, Hall (1993: 465) notes how, ‘although playing the flirting
game is an accepted part of interacting with customers, waitresses are more likely
than waiters to be the subject of sexual approaches’ (see HRM in practice 11.11).
What the above discussion points to is that within tourism and hospitality there
is not only the potential for sexual harassment in terms of the superior/subordinate
relationship, but also via potentially pernicious customer interactions. The latter
aspect in particular is one where some tourism and hospitality organizations may
allow for a certain amount of ambiguity to creep in. For example, in Loe’s (1996)
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HRM in practice 11.10 Skilled professional
or ‘trolley dolly’?
Historically the process of sexualization of airline cabin crew has been one which has
changed over time. At the outset of the airline industry flying was an all-male preserve,
including the job of air steward. Though there was a limited experimentation with the
recruitment of female air stewards in the 1930s it was not until the mid-1940s that the
job was really feminized. In the 1950s and 1960s airlines began to sexualize their stew-
ardesses, mainly through their advertising and marketing by portraying the ‘sexy’ image
of female cabin crew. Sexually suggestive advertising slogans used in the past have
included Delta’s ‘Ready when you are’, National’s ‘I’m Anne, fly me’ and Continental’s
‘We really move our tail for you’. This portrayal of what have often been described as
‘trolley dollies’ was one which seemingly became increasingly anachronistic as airlines were
accused of sex discrimination and sexism, especially by the trade unions representing
stewardesses. By the mid-to-late 1970s the selling of overt sexuality seemed to wane.
However, a recent review of aesthetic labour in the airline industry offers evidence as to
how some airlines still seem to mobilize their employees’ physical disposition to move
beyond an aesthetic appeal to one where the appeal seems to be to the sexual desires of
customers. The examples cited are Virgin Blue and Air Asia, two new airlines operating
in the low-cost carrier market. An examination of the advertizing and marketing of these
two airlines points to the manner in which female employees are sexualized, particularly
in Virgin Blue, which was described in one newspaper as the world’s sexiest airline. For
example, one advert produced by the company featured smiling, attractive and youthful
flight attendants and was captioned ‘Plane Fares, Beautiful Service’.
Derived from Mills (1996); Spiess and Waring (2005).
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thinly disguised ethnographic study of ‘Bazooms’, she notes how new employees
had to sign the official Bazooms sexual harassment policy, which states that ‘In a
work atmosphere based upon sex appeal, joking and innuendo are commonplace’
(p. 400). Of course, there is potentially a thin line between innuendo and what may
be thought of as harassing behaviour. Such an issue seemed less of a concern for
the company and the Bazooms employee handbook described sexual harassment
in the following manner:
Sexual harassment does not refer to occasional compliments of a socially
acceptable nature. It does not refer to mutually acceptable joking or teasing.
It refers to behaviour which is unwelcome, that is personally offensive, that
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HRM in practice 11.11 Hooters: An acceptable
form of sexualization?
Although selling itself as ‘a family restaurant’ (though 70 per cent of customers are
men aged 25–54 years) the Hooters company uniform of short shorts, and a choice of
either a tight tank top, crop or tight T-shirt suggests that the intent of the company is to
project an image of sexy, eager waitresses. Golding (1998: 7) notes how the company
‘unashamedly uses nubile young waitresses dressed in skimpy tops to attract customers’ –
the so-called ‘Hooters Girls’. The success of the company is such that they now have over
400 restaurants in the US as well as a presence in 19 other countries. Additionally, until
recently the company also had an airline, Hooters Air, which in addition to the airline
crew also featured two Hooters Girls on each flight. A recent case study of Hooters in
Fortune recognizes the extent to which Hooters is considered a mainstream business suc-
cess (Helyar, 2003). Indeed, the company’s marketing and branding strategy has survived
a challenge in the American courts on the basis that the company brand is ‘female sex
appeal’ (Prewitt, 2003). It is also interesting to note the reaction of the then editor of
Caterer and Hotelkeeper to the arrival of the first Hooters restaurant in the UK. In an
opinion piece the editor saw little to worry about in the emergence of Hooters. In answer
to his own question of whether ‘the moralists and protectors of womens’ rights [are]
being distracted by a bit of harmless fun?’, he goes on to suggest that: ‘Blatant titillation has
become widely accepted in the selling of countless commodities, from fast cars to chocolate
bars, from drinks to holidays … If we are not offended by this, then we shouldn’t get upset
about Hooters, because the principle is much the same’ (Mutch, 1998: 23).
Review and reflect: To what extent do you agree with the sentiment of Mutch?
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debilitates morale, and that, therefore, interferes with work effectiveness
(quoted in Loe, 1996: 412).
Whilst ultimately the manner in which some tourism and hospitality organizations
portray a certain ‘style’ may be one which is debated in terms of the extent to which
it encourages customers to engage in unacceptable behaviour, the key point remains
that sexually harassing behaviour can have a significantly harmful impact on
employees. Consequently, it is important that the organization develops a suitable
policy response.
Developing policy for sexual harassment
Therefore as a way of preventing sexual harassment organizations should imple-
ment an effective policy, which should aim to (CIPD, 2006b):
? Set out what is considered to be inappropriate behaviour, as well as defining
positive and supporting behaviours.
? Explain the damaging effects and why it will not be tolerated.
? Affirm that sexual harassment will be treated as a disciplinary offence with
appropriate penalties attached.
? Explain complaints procedure, including how to get help and make a com-
plaint, formally and informally.
? Affirm that the complaint will be treated seriously, speedily and confidentially
and that there will be no victimization for making a complaint.
? Make it a duty for supervisors/managers to implement policy and ensure it is
understood.
By offering a clear policy employees who are being sexually harassed can feel con-
fident that the issue will be taken seriously. This point is important as in bringing
forward a complaint of sexual harassment the employee should not have to fear
reprisals or continued harassment or equally be worried about things like risking
future promotion opportunities. Once a complaint is made the investigation
should begin as soon as possible and provide (CIPD, 2006b):
? Aprompt, thorough and impartial response.
? Independent, skilled and objective investigators.
? Representation for both parties.
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? Complaint details, the right to respond and adequate time to respond.
? Atime scale for resolving the problem.
? Confidentiality for all parties.
Investigations of sexual harassment may either be by formal or informal means,
though often the preference will be for an informal resolution (IDS, 2003). If though
there is a more formal investigation, depending on the outcome of any investiga-
tion there may be a range of potential decisions. For example, if the harassment is
sufficiently serious it could lead to the dismissal of the perpetrator. Alternatively,
there may be disciplinary action short of dismissal, counselling for the person
whose behaviour is unacceptable and often the perpetrator may be transferred.
There may be occasions where individuals are unclear how their behaviour may be
seen as harassing and ensuring that they are aware of acceptable and unacceptable
behaviour at work will prevent ambiguity and stop harassment reoccurring.
Smoking
In a recent review of smoking in the restaurant industry, Nickson (2000) noted that
much of the work in this area could be distilled into two broad themes:
? The responsibility of the employer to maintain a safe environment for employ-
ees and customers.
? The necessity of satisfying the needs of all consumers (i.e. smokers and non-
smokers) to remain profitable.
From a health and welfare perspective most of the concerns about smoking in the
workplace are linked to the phenomenon of environmental tobacco smoke, or as it
is rather more popularly known, passive smoking. In the past many tourism and
hospitality workplaces, such as restaurants and pubs, would be considered as
being a relatively smoky atmosphere, and consequently possibly more damaging
to employee health. The issue of passive smoking has been at the centre of an
intense debate between pro- and anti-smoking groups, with each side contesting
the validity of each other’s statistics. Increasingly though it appears that those
against passive smoking are winning the argument as a number of countries have
now moved to banning smoking in public places, including pubs, hotels and
restaurants (see HRM in practice 11.12).
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WELFARE, HEALTH AND SAFETY 265
HRM in practice 11.12 A global curb on smoking
Australia: Smoking is banned in all airports, government offices, health clinics and work-
places in Australia. Restaurants in most states and territories are also smoke free zones.
France: Attempted to cut smoking levels by raising the price of cigarettes by 20 per cent
in October 2003. Despite this price hike it was reported that there was no noticeable dif-
ference in Paris’ traditionally smoke-filled cafes and bars.
Italy: Imposed a ban on smoking in all enclosed public places including bars and restaur-
ants in 2005. The ban has not been welcomed by all, with some bar owners and
smokers saying they will ignore the ban on the grounds that cigarettes and smoking are
an integral part of Italian bar and cafe culture. The new rules allow smoking in special
sealed-off areas fitted with smoke extractors; however many bar owners say fitting the
automatic doors and forced ventilation systems required by law is too expensive.
The Netherlands: A tough crackdown on smoking from 1 January 2004 saw cigarettes
banned from many public places including railway stations, trains, toilets and offices.
Hotels, bars and restaurants are likely to face a ban from 2009. Some 30 per cent of the
Netherlands’ 16 million population are smokers – a higher rate than all other EU countries
except Spain, Greece and Germany.
Norway: A national ban was imposed on smoking in restaurants, bars and cafes from
June 2004. The government says the ban is to protect staff working in these establish-
ments from passive smoking and to ‘de-normalize’ smoking as a social pastime.
Spain: Smoking was banned in offices, shops, schools, hospitals, cultural centres and on
public transport from 1 January 2006. The government says the ban is necessary because
smoking is the biggest killer in Spain, with 50 000 smoking-related deaths annually.
Sweden: Smoking was prohibited in all bars and restaurants from May 2005. Establishments
wanting to allow smoking are required to have a closed-off section with specially
designed ventilation, where no food or drink can be served. Most venues were not
expected to be able to afford such renovations. The ban followed lobbying by the coun-
try’s licensing sector which said bar and restaurant staff were more likely to suffer lung
cancer than in any other profession.
United States: Many cities and states enforce bans on smoking. California has some of the
toughest and most extensive anti-smoking legislation anywhere in the world. Smoking is
also banned in restaurants, bars and enclosed workplaces – and on beaches – through-
out the state. In New York, smoking has been banned in bars, clubs and restaurants since
March 2003.
Derived from BBC (2005).
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At the time of writing within the UK the picture is currently mixed. Within
Scotland the introduction of the Smoking, Health and Social Care (Scotland) Act
2005 led in 2006 to the banning of smoking in public places, including restaurants,
bars and pubs. In a similar vein legislation will lead to a smoking ban in England
from summer 2007. It is suggested that creating healthier workplaces lies at the
heart of the legislation and ultimately the development of smoking bans marks a
significant intervention by government to improve occupational health.
Stress
Stress has increasingly become a major issue in the workplace with a seemingly ever
larger part of the workforce suffering from work-related stress. Indeed, CIPD (2005b)
note how the Health and Safety Executive (HSE) have indicated that stress is likely
become the most dangerous risk to businesses in the twenty-first century. In simple
terms stress is the adverse reaction people have to excessive demands or pressure
when trying to cope with tasks and responsibilities in the workplace (LRD, 2006a). At
one level, stress is a normal part of everyday life and within the workplace many
writers talk about so-called ‘good’ stress, or ‘eustress’. This optimum level of stress is
felt to be important to sustain high performance and will of course vary with indi-
viduals. Once an employee feels unable to cope or control the pressure then they will
experience stress as ‘distress’, which will lead to declining performance. The most
recent research conducted by the HSE indicates that over half a million workers in the
UK were suffering from work-related stress, depression or anxiety caused or made
worse by their current or past work. As a consequence it is estimated that there were
12.8 million lost working days due to work-related stress in 2004–2005 (LRD, 2006a).
European-wide research has suggested that over 40 million EU workers are affected
with work-related stress, with the European Commission suggesting that the ‘con-
servative’ estimate of the cost of this stress being €20 billion (£16 billion) (LRD, 2002).
Review and reflect
Think about what makes you stressed at work and how you can address this. To what
extent is your stress at work alleviated by the organization and its work processes and to
what extent by your own initiative? Where should the responsibility lie, with the organ-
ization or the individual?
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As with a number of other aspects discussed in this chapter organizational responses
to stress are likely to reflect both legal and business arguments. From a legal point of
view employers have a general duty of care under section 2 of the Health and Safety
at Work Act (HASWA) 1974 to ensure the health, safety and welfare at work of all of
their employees and this includes their mental health. In addition, there is also
European-inspired regulation and Regulation 3 of the Management of Health and
Safety at Work Regulations 1999 requires employers to undertake risk assessment in
order to minimize the hazards facing staff, including ensuring that employees health
is not placed at risk by excessive and sustained levels of stress. Failure to comply with
the duties contained in the HASWA and the Management of Health and Safety at
Work Regulations may result in significant compensation being paid by employers.
For example, a number of recent court and out of court settlements in the UK have
seen figures of up to £300000 paid by employers (LRD, 2002). From a business point
of view Figure 11.1 outlines a number of possible negative effects of stress, which will
have a deleterious impact physiologically and psychologically on individuals, which
in turn is likely to significantly hamper organizational performance.
WELFARE, HEALTH AND SAFETY 267
Anxiety Impaired job performance
Alcohol abuse Increased absenteeism
Drug abuse Decreased commitment and motivation
Job dissatisfaction
Depression
Higher turnover rates
Higher accident rates
Lower productivity
Lower morale
Damaged reputation
Panic attacks
Irritability
Low self-esteem
Disturbed sleeping patterns Recruitment problems
Poor concentration
Frequent headaches
Gastric and intestinal problems
High blood pressure
Heart disease
Adapted from IDS (2004a)
Individual Organizational
Figure 11.1 Some negative effects of stress for the individual and organization.
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As we noted above there is a need for organizations to be proactive in recog-
nizing and responding to potential stressors in the workplace. The HSE has sought
to develop a management standard which classifies some of the key areas which,
if mismanaged, can become workplace stressors, these are (HSE, 2005):
Demands – including issues like workload, work patterns and the work envir-
onment. The standard expects that employees are able to cope with the demands
of their jobs. To achieve the standard the organization should provide employees
with adequate and achievable demands in relation to the agreed hours of work;
ensure that people’s skills and abilities are matched to the job demands; that jobs
are designed to be within the capabilities of employees; and that any employee
concerns about their work environment are addressed.
Control – is primarily concerned with how much say the person has in the way
they do their work. The standard suggests that employees are able to have a say
about the way they do their work. To achieve the standard the organization should
aim where possible to ensure that employees have control over their pace of work;
that employees are encouraged to use their skills and initiative to do their work;
that employees are encouraged to develop new skills to help them undertake new
and challenging pieces of work; the organization encourages employees to develop
their skills; employees have a say over when breaks can be taken and employees are
consulted over their work patterns.
Support – includes the encouragement, sponsorship and resources provided
by the organization, line management and colleagues. The standard suggests that
employees should receive adequate information and support from their col-
leagues and superiors. To achieve the standard, the organization should have pol-
icies and procedures to adequately support employees; that systems are in place to
enable and encourage managers to support their staff; that systems are in place to
enable and encourage employees to support their colleagues; that employees
know what support is available and how and when to access it; employees know
how to access the required resources to do their job and employees receive regular
and constructive feedback.
Relationships – includes promoting positive working to avoid conflict and
dealing with unacceptable behaviour. The standard expects that employees
should not be subjected to unacceptable behaviours (e.g. bullying and harass-
ment) at work. To achieve the standard, the organization should promote positive
behaviours at work to avoid conflict and ensure fairness; employees share infor-
mation relevant to their work; the organization has agreed policies and procedures
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to prevent or resolve unacceptable behaviour; that systems are in place to enable
and encourage managers to deal with unacceptable behaviour and that systems
are in place to enable and encourage employees to report unacceptable behaviour.
Role – includes whether people understand their role within the organization
and whether the organization ensures that the person does not have conflicting
roles. The standard expects that employees understand their role and responsibil-
ities. To achieve the standard, the organization should ensure that, as far as pos-
sible, the different requirements it places upon employees are compatible; the
organization provides information to enable employees to understand their role
and responsibilities; the organization ensures that, as far as possible, the require-
ments it places upon employees are clear and systems are in place to enable
employees to raise concerns about any uncertainties or conflicts they have in their
role and responsibilities.
Change – includes how organizational change (large or small) is managed and
communicated in the organization. The standard expects that the organization will
frequently engage with employees when undergoing an organizational change. To
achieve the standard the organization should provide employees with timely
information to enable them to understand the reasons for proposed changes; the
organization ensures adequate employee consultation on changes and provides
opportunities for employees to influence proposals; employees are aware of the
probable impact of any changes to their jobs. If necessary, employees are given
training to support any changes in their jobs; employees are aware of timetables
for changes; employees have access to relevant support during changes.
Anumber of the above aspects can be seen in research examining stress in the
tourism sector. Ineson et al. (2001) conducted in-depth interviews with 10 UK tour
managers and identified 117 critical incidents that induced stress. These aspects
were grouped into four categories relating to colleagues, clients, nature of the job
and poor management. For example, with regard to the nature of the job the particu-
lar work environment of tour managers means that they may face situations such
as medical emergencies or logistical problems such as breakdowns and getting
stuck in traffic jams. Similarly, a number of the tour managers recalled instances
where clients had questioned and contradicted their commentaries, which had
undermined their professional authority as they appeared to be incompetent.
Interestingly though the most common source of stress was employer/management-
induced stress. Examples of such stress included lack of training from the
employer and a lack of management communication and support. Similar results
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were also apparent in Law et al.’s (1995) study of 102 front line staff from 14
Australian tourist attractions. Again, poor management was the reason mentioned
most often by respondents as a source of stress. A number of the other stressors
tended to revolve around the interactions with customers, such as difficulties in
controlling crowds. While it might seem self-evident that difficult customers are
an occupational hazard for tourism and hospitality employees there is a need to
ensure that they are properly trained to deal with such situations. This and other
aspects are clearly reliant on proactive management and in considering workplace
stressors it is clear that there is significant responsibility on employers and man-
agers to address these issues in a proactive manner, including developing a stress
policy.
Developing policy
IDS (2004b) recognize the importance of having a stress policy in bringing the sub-
ject out into the open, ensuring that stress is not seen as a taboo subject and
employees do not feel stigmatized for feeling ‘stressed’. They also recognize that a
standard stress policy is likely to have the following aspects:
? Adefinition of stress.
? Adescription of the symptoms of stress and stress-related illnesses.
? An outline of the organization’s responsibilities for managing stress.
? An outline of managers’ and employees’ responsibilities for managing stress.
? Alist of both internal and external sources of help for stress-related issues (see
HRM in practice 11.13).
Working time
Excessive working time has often been linked to stress (LRD, 2006a) and clearly
is deleterious to a healthy work-life balance. Estimates suggest that around
11 per cent of UK employees currently work more than 48 hours a week, this
figure is the highest in the EU, creating concerns about ‘burn out’ (LRD, 2006b).
Additionally, the UK tops the European hours league with a usual working week
of 42.7 hours, compared to an EU average of 41 hours (LRD, 2006b). Interestingly
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though compared to non-EU countries, the UK has shorter working hours than
Australia, Japan and the US (CIPD, 2006c). Many would argue that debates about
long working hours are particularly pertinent to tourism and hospitality. The long
hours culture in the industry means that many employees work excessive hours,
which is likely to have a harmful impact on their health. Arecent survey of nearly
700 hotel, restaurant and bar employees reported in Caterer and Hotelkeeper (9th
June 2005, ‘Long working hours the norm’) found that 93 per cent worked more
than 40 hours, with nearly a fifth (17 per cent) working more than 60 hours a week.
The same is also very much true for managers and operators of small business,
with a survey of 1400 small hospitality businesses finding that 46 per cent of pub-
licans, 43 per cent of hoteliers and 13 per cent of restaurateurs worked more than
70 hours a week (Cushing, 2004).
The continuing prevalence of excessive working time for many tourism and
hospitality employees may seem surprising given the introduction of the Working
Time Regulations (WTR) in 1998. The introduction of the WTR in the UK was not
without controversy. The WTR were initially introduced as a health and safety
measure. Despite this, the government of John Major sought to challenge the legal-
ity of the measure via the European Court of Justice (ECJ), but eventually lost the
WELFARE, HEALTH AND SAFETY 271
HRM in practice 11.13 EAPs: Helping employees
in the workplace
EAPs are external help services provided by employers which aim to assist in the identifi-
cation and resolution of employee concerns that affect performance. EAPs originated in
the US and remain popular there, with over 85 per cent of the largest Fortune 500 com-
panies using their services. Outside the US the uptake is rather patchier. In Europe EAPs
are rarely used, though there is evidence that more UK employers are using their services,
which now cover around 15 per cent of employees. EAPs typically provide a 24-hour, 365
days-a-year telephone counselling service for employees on issues such as stress, bullying,
violence, and drug and alcohol misuse. A recent decision in the Court of Appeal on work-
related stress has given EAPs a significant boost. The ruling from the Court of Appeal sug-
gested that the provision of EAP provision to address stress pointed to a proactive
employer response and consequently employers who use such services are less likely to be
found to be in breach of the duty of care expected in health and safety legislation.
Source: LRD (2003a).
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case in November 1996, as the ECJ ruled that working hours were a health and
safety issues as opposed to a more general social issue. As a result the UK govern-
ment eventually introduced the WTR into law in October 1998 and the main pro-
visions are (CIPD, 2006c):
? Amaximum working week of not more than 48 hours a week, including over-
time, normally calculated over a rolling 17-week period.
? Employees are entitled to a daily rest period of 11 hours.
? Night workers are limited to an average of 8 hours work in 24 hours.
? Employees are entitled to 4 weeks paid holiday.
? Where the working day is longer than 6 hours, workers will be entitled to a rest
break of 20 minutes.
? In each 7-day period, workers will be entitled to 1 day’s rest, in addition to the
above 11-hour period set out above.
? Free health assessments must be made available to night workers.
When they were first introduced it was felt that the WTR would have a significant
impact on UK organizations. In particular, the extension of paid annual leave to
the UK, the only EU country not to previously have a legal right to paid holidays,
affected around 2.5 million workers, mostly part-timers and women. Moreover
just over four million workers had less than 3 weeks leave and six million less than
4 weeks leave (Milne, 1998). In reality though the impact of the WTR has proved to
be less than thought, in part because of a series of derogations which the UK gov-
ernment negotiated (Hurrell, 2005). Chief among these is the ability of companies
to offer an ‘opt-out’ where employees sign away their right to a 48-hour limit on
their working week. This measure is one which has been adopted by a large num-
ber of tourism and hospitality employers. Although the European Commission
has recently sought to restrict the UK’s right to offer an opt-out clause, at the time
of writing the UK government seems determined to retain the opt-out (LRD,
2006b). Finally, even the provision of paid leave is far from straightforward. Due to
the WTR never specifying whether public and bank holidays would be included in
the 20-day calculation some employers have taken advantage of this loophole and
have used bank holidays in calculating their employees’ holiday entitlement.
Resultantly, around 3.4 million employees have not been getting 20 days min-
imum paid leave a year, with around one million of these employees being in the
leisure and retail industries (LRD, 2005b). More recently it appears that this loophole
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is now likely to be closed with the Government announcing plans to rectify this
anomaly (LRD, 2006c).
Workplace violence
Tourism and hospitality establishments rank high on the list of workplaces with
high incidences of violence. LRD (2003b) reports evidence from the British Crime
Survey on the number of workers reporting assaults or threats which occurred
while the victim was working and were perpetrated by a member of the public.
Across all occupations the percentage of workers who faced violence was just
1.2 per cent. However, for leisure service providers the figure rises to 3.7 per cent
and for publicans and bar staff it rises significantly to 11.5 per cent. Boyd (2002) in
a survey of nearly 1200 employees in the airline and railway industries also found
that 70 per cent of her respondents reported an increase in the number of abusive
passengers over the previous year. Such abuse was both verbal with 74 per cent of
respondents experiencing verbal abuse from passengers at least once a month.
More worryingly still, nearly 40 per cent of her respondents had experienced at
least two types of physical abuse and 26 per cent had experienced at least three
types of physical abuse. Instances of such abuse included being pushed, punched,
kicked, slapped, struck with an object and spat at.
These relatively high figures reflect the fact that many employees in the
tourism and hospitality sector have to deal with members of the public, exchange
or collect money, work at night and work alone, or in small numbers. Added to
these aspects many workplaces in tourism and hospitality involve the consump-
tion of alcohol, often to excess. Certainly, alcohol seems to have a catalytic effect in
many instances of workplace violence in tourism and hospitality. Morgan and
Nickson (2001) in a review of ‘air rage’ in the airline industry found that excessive
alcohol consumption was by far the most commonly cited contributory factor to
passenger violence or aggression. Other reasons included being deprived of nico-
tine and the inherently stressful nature of flying.
Workplace violence is undoubtedly a complex issue, though again there is a
need for organizations to be proactive. Certainly an argument could be made that
the Management of Health and Safety at Work Regulations would encourage
organizations to assess and act upon any potential risks of violence. Amongst
other things organizations could consider issues such as the underlying cause of
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the violence, working practices, and the provision of suitable training and support
needs (see HRM in practice 11.14).
Conclusion
Welfare, health and safety issues have become increasingly important to tourism
and hospitality organizations as the business case for proactive responses has
become recognized. In considering the ‘alphabet’ of welfare issues a number of
these issues seems to have a particular resonance within the tourism and hospital-
ity sector. The presence of demanding customers, the blurring of work and leisure
and often catalytic effect of alcohol create particular circumstances where the duty
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 274
HRM in practice 11.14 A proactive response
to ‘air rage’
IDS (2000) report on how Virgin Atlantic have sought to address violence at work, and
specifically air rage, by improving their HR approaches. Within the recruitment and selec-
tion process for instance Virgin look for key skills in relation to communication skills,
assertiveness and customer service orientation, and although not a primary consideration
in the selection process there is an assessment of how potential employees may respond
to difficult scenarios involving aggressive customers. Employees also receive training in
observation skills to help them identify potentially disruptive passengers at an early stage.
Staff are taught how to recognize potential precursors of an air rage incident, such as the
tapping of fingers or the reddening of a passengers face, and in response to these use
calming techniques, such as using friendly gentle tones and body language, to defuse
the situation. As a result of these approaches the need to have recourse to actual phys-
ical restraint has significantly decreased in Virgin Atlantic. If a major incident does occur
though the company also looks to provide a supportive response. There is an automatic
debriefing to the whole flight crew, even those employees not directly affected by the
incident. Attendance at such debriefings is mandatory and this recognizes that they may
be a delayed response from employees to what is a potentially very stressful experience
Further to that Virgin also provide follow-up counselling, if necessary, through their occu-
pation health department. Finally, the company also offers legal and financial support to
employees who wish to pursue legal action against assailants.
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of care of employers seems particularly pronounced. That said, it was also recog-
nized that in seeking to intervene in often sensitive issues that the balance between
an organizational members public and private life is far from clear cut. Undoubtedly
managers in modern organizations require an awareness of these issues and how
best to intervene for the benefit of both the organization and individual; a task that
is far from easy in dealing with potentially sensitive issues.
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Arkin, A. (2005) ‘Out of the shadows’, People Management, 24 November, 24–28.
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Websites
http://www.managingabsence.org.uk/ provides employers with comprehensive information on cost-effective
approaches to managing short-term sickness absenteeism.
Two charitable organizations that campaign on issues related to AIDS/HIV are the Terence Higgins Trust and
the National Aids Trust, http://www.tht.org.uk/ and http://www.nat.org.uk/
The Ark Foundation is a service offered by Hospitality Action, set up for the purpose of educating hospital-
ity industry students, employees and management as to the dangers of alcohol dependency and other
drug misuse, http://www.thearkfoundation.co.uk/
DrugScope offers some interesting views on policy issues surrounding drugs and can be found at
http://www.drugscope.org.uk/
Women Against Sexual Harassment is a global organization that campaigns against sexual harassment,
http://www.washrag.org/
The Health and Safety Executive’s stress at work page can be found at http:// www.hse.gov.uk/
stress/index.htm
The Health and Safety Executive’s violence at work page can be found at http:// www.hse.gov.uk/
violence/index.htm
The Department of Trade and Industry has details of the Working Time Regulations and other case studies on
how reduce long hours http://www.dti.gov.uk/employment/employment-legislation/working-time-regs/
index.html
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Chapter 12
Grievance and
disciplinary procedures
Chapter objectives
This chapter examines the importance of rules and
regulations in the employment relationship,
focusing on grievance and disciplinary procedures.
Specifically, the chapter aims to:
? Consider the complementary nature of grievance
and disciplinary procedures.
? Identify sources of employee grievances.
? Assess the differing severity of organizational
responses to breaches of discipline.
? Recognize the need for fairness in dismissing
employees.
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Introduction
It is generally accepted that there is a need for procedures in the employment rela-
tionship to ensure that both managers and employees are aware of the expectations
of the organization (Marchington and Wilkinson, 2005). In this sense managers need
a framework in which to direct and guide behaviour of employees in the workplace.
Similarly employees need to understand their place in the organization and its expec-
tations. Thus, there is a need for some articulated order which is likely to be impor-
tant to sustain organizational effectiveness. Consequently rules are needed which
cover the whole range of human resourcing, such as what work is done, how jobs
are constituted, training and promotion, hours of work, health and safety and stan-
dards of behaviour and performance. Equally, there is a need for procedures to pro-
vide a framework which allows for notions of organizational justice and reciprocity.
This point is particularly true when we think of grievance and disciplinary proce-
dures. We can conceptualize grievance and disciplinary procedures as being com-
plementary, but also distinct. In this way the former is a mechanism whereby
employees can challenge management’s power, either collectively or individually,
and the latter is a way of establishing and maintaining standards which are accept-
able to management. Whilst much of this discussion may seem rather prosaic it is
important to recognize that all managers should have at least a working knowledge
of grievance and disciplinary procedures, particularly with regard to the ultimate
sanction of dismissal. Edwards (2005) notes how dismissal represents the ‘dark’ or
‘murky’ side of HRM and is often omitted in many discussions of the subject. It is
though a fact of organizational life, in much the same way as employees choosing
voluntarily to leave the organization. Ultimately, then, as Torrington et al. (2005: 554)
rather neatly express it, ‘The two complementary processes are intended to find
ways of avoiding the ultimate sanction of the employee quitting or being dismissed,
but at the same time preparing the ground for those sanctions if all else fails’.
Setting the scene on grievance and
disciplinary procedures
Salamon (1992: 568) defines grievance as, ‘a formal expression of individual or col-
lective employee dissatisfaction primarily, but not exclusively, in respect of the
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GRI EVANCE AND DI SCI PLI NARY PROCEDURES
application or non-application of collective agreements, managerial policies and
actions or customs and practice’. In recognizing the distinction between individual
and collective aspects of dissatisfaction many writers suggest that grievances are
usually about individual concerns, whilst collective dissatisfaction is likely to become
a dispute, especially if a trade union is involved. On the other hand, discipline is
defined by the same author as, ‘formal action taken by management against an
individual or group who have failed to conform to the rules established by man-
agement within the organization’ (Salamon, 2000: 565). Often grievance and discip-
linary procedures will be conceptualized in quasi-judicial terms wherein a body of
recognized rules is administered under a judicial-type procedure.
Although the argument in support for the establishment of clear rules and regu-
lations in an organizational setting seems compelling research undertaken in the
tourism and hospitality industry suggests that in the past some organizations have
been slow to develop policy. For example, Price (1994) found that only 24 per cent of
241 organizations she surveyed had a well-developed disciplinary procedure. More
recently though there is greater prescription emanating from legislation and since
1st October 2004 all employers, regardless of size, have to have a disciplinary and
grievance procedure and to notify their employees of it, in order to comply with the
Employment Act 2002 (LRD, 2006). In developing a policy an obvious starting
point is the influential Advisory Conciliation and Arbitration Service (ACAS) Code
of Practice on disciplinary and grievance procedures. Originally produced in 1977
and most recently revised in 2004 the code of practice provides a series of recom-
mendations on how best to approach grievance and disciplinary procedures.
Indeed, an awareness of procedure may be particularly apposite for tourism and
hospitality managers as evidence suggests that they may be more likely to find
themselves enmeshed in either a grievance or disciplinary situation. For example, the
Chartered Institute of Personnel and Development (CIPD, 2004) in a recent survey
of nearly 1200 UK and Irish companies (including 142 tourism and retail employers)
found that private sector service employers had twice as many grievance and disci-
plinary cases compared to the manufacturing, public and voluntary sectors.
Grievance procedures
What is a grievance? Generally, as we have noted a grievance is the right of
employees to express and attempt to resolve dissatisfaction that they might have
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in the work situation. Pigors and Myers (1977: 152, cited in Torrington et al., 2005)
outline degrees of discontent which employees may have in the workplace:
? Dissatisfaction: anything that disturbs an employee, whether or not the unrest is
expressed in words.
? Complaint: a spoken or written dissatisfaction brought to the attention of the
supervisor and/or trade union representative.
? Grievance: a complaint that has been formally presented to a management rep-
resentative or to a union official.
Grievances can take a number of forms and Salipante and Bouwen (1990) have
provided a widely used schema to categorize sources of conflict and grievance.
They suggest that conflict can be distinguished in three ways:
? Environmental conflict is primarily concerned with working conditions and
nature of work. These problems will encompass the economic terms and condi-
tions of the job, the physical job conditions and job demands either being too
great or too little for the individual’s skills and abilities.
? Social substantive these grievances stem from perceived inequalities in treatment
or disagreements over goals or means. Conflict of this nature may be precipi-
tated by organizational policy or management action, which creates a percep-
tion of inequity arising from how decisions are taken.
? Social relational grievances arise from the relationships between individuals and
groups within the organization, for example, personality conflicts, racism and
sexism.
The findings of the 2004 Workplace Employment Relations Survey echo the
above categorization, whilst also suggesting that the bulk of grievances raised are
more likely to be in relation to Salipante and Bouwen’s environmental and social
Review and reflect
What makes you unhappy at work? Would you be willing to articulate this dissatisfaction
as a grievance? If not, why not?
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substantive aspects. In that sense pay and conditions, relations with supervisors/
line managers and work practices, work allocation and the pace of work were the
most common grievances raised by employees (Kersley et al., 2006).
As suggested by our earlier recognition of Pigors and Myers work all of us at
some point in our organizational lives will have a degree of dissatisfaction with our
work situation, though the extent to which we will be willing to formally articulate
this will vary. Ordinarily, it is unlikely that we will choose to formally register our
dissatisfaction as a grievance. Instead, employees may express their dissatisfaction
in a number of ways short of formally registering a grievance. For example, employ-
ees may simply impose their own unilateral solution through things like increased
absenteeism, withdrawing their goodwill or in a reduction in morale/motivation.
Ultimately the dissatisfaction may be such that the employee chooses to leave and
the high rate of labour turnover in hospitality and tourism suggests that many
employees take such a course of action. If however an individual chooses to stay in
the organization and decides to formally present a grievance it is important that it is
properly considered and addressed. The ACAS code of practice offers a clear proced-
ure for addressing grievances, based on a three-stage approach (ACAS, 2004):
? The employee informs the employer of their grievance in writing.
? The employee should be invited by the employer to a meeting to discuss the
grievance where the right to be accompanied will apply and be notified in writ-
ing of the decision. The employee must take all reasonable steps to attend this
meeting.
? The employee is given the right to an appeal meeting if they feel the grievance
has not been satisfactorily resolved and be notified of the final decision.
Ordinarily, employees would initially raise the grievance with their line manager,
unless somebody else is specified in the organization’s procedure. Once received a
grievance will then lead to a meeting between the employee and manager where the
grievance will be discussed (and see Torrington et al., 2005 for details of how to
approach grievance and disciplinary interviewing). Finally, the decision will be
communicated in writing to the employee, who if they are still unhappy will then
have the right to appeal, which ordinarily would be dealt with by a more senior man-
ager, who again will write to the employee with the final decision. Importantly, if an
employee is to subsequently seek to take a grievance further through the employment
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tribunal (ET) system, then they automatically have to have first gone through the
organization’s grievance procedure.
Disciplinary procedures
Having examined grievance procedures we can now consider discipline in the
organization. In discussing discipline in the organization it is interesting to note
the extent to which we are likely to be predisposed to obey rules and authority.
Torrington et al. (2005: 555–556) draw on the work of the famous social psychologist
Stanley Milgram to suggest a number of features which explain our propensity to be
obedient towards authority and how this is likely to shape workplace behaviour:
? Family: the inculcation of respect for adult and parental authority encourages us
to generally respect authority.
? Institutional setting: in school, university and work we learn how to function in
an organization, often accepting our subordinate position.
? Rewards: compliance brings rewards, disobedience brings punishment.
? Perception of authority: authority is normatively supported, so we are generally
predisposed to follow organizational and managerial rules, but where this does
not happen the organization may have to take disciplinary action.
Again in developing a disciplinary procedure the ACAS code of practice provides
a template suggesting that good disciplinary procedures should (ACAS, 2004):
? Be in writing.
? Specify to whom they apply.
? Be non-discriminatory.
? Ensure matters are dealt with without unnecessary delay.
Review and reflect
What might explain our pre-disposition to respect rules and authority?
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? Allow for information about proceedings, witness statements and records to be
kept confidential.
? State the disciplinary actions which may be taken.
? Specify the levels of management which have the authority to take the various
forms of disciplinary action.
? Provide for employees to be informed of complaints against them and where
possible all relevant evidence before any hearing.
? Give employees the opportunity to state their case before a decision is reached.
? Provide employees with the right to be accompanied by a trade union repre-
sentative or fellow employee at any hearing.
? Ensure that except for gross misconduct, no employee is dismissed for a first
breach of discipline.
? Ensure that disciplinary action is not taken until the case has been carefully
investigated by management.
? Ensure that employees are given an explanation for any penalty imposed.
? Provide employees with rights to appeal, normally to a more senior manager.
Implicit in the guidelines is recognition of the differing severity of organizational
responses in terms of misconduct and ordinarily the distinction is made between
minor misconduct, serious misconduct and gross misconduct. For many instances
of minor misconduct or unsatisfactory performance a quiet word from a manager
may be all that is needed to improve an employee’s performance and resolve the
issue. However, if this informal action does not bring the desired improvement
then an employer may take a more formal approach. As with grievance proced-
ures the ACAS code of practice outlines a three-stage approach to discipline. First,
the employer signals to the employee in writing what they have done wrong.
There will then be a meeting to discuss the problem, where the employee will
be allowed to ask questions, present evidence, call witnesses and be given an
opportunity to raise questions about information provided by witnesses. Lastly,
the employer must then decide on the basis of the meeting whether the discipli-
nary action was justified and if that is the case the nature of any sanction against
the employee. The decision on disciplinary action will clearly be influenced by the
nature of misconduct and in that sense Figure 12.1 outlines a typical disciplinary
procedure with commensurate organizational responses.
Examples of minor/serious misconduct could include things such as persist-
ent absenteeism, poor timekeeping, failure to adhere to dress codes or appearance
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standards or unacceptable performance and if employees do receive a oral or writ-
ten warnings they are likely to have a specified ‘life’, after which they are disre-
garded. For example, for an oral warning the period is likely to be for 6 months,
whilst for a written warning it will be 1 year and a final written warning, 2 years
(CIPD, 2005). For gross misconduct ACAS (2004) notes how instances of such mis-
conduct are likely to be decided by the organization given their own particular cir-
cumstances, whilst still noting some typical examples, including:
? theft or fraud;
? physical violence or bullying;
? deliberate and serious damage to property;
? serious misuse of an organization’s property or name;
? deliberately accessing internet sites containing pornographic, offensive or
obscene material;
? serious insubordination;
? unlawful discrimination or harassment;
? bringing the organization into serious disrepute;
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 286
Nature of the disciplinary
matter
Management response and
action
Minor misconduct Recorded oral warning
Serious misconduct or repeated
minor misconduct for which a
written or oral warning has
been received
Written warning followed by
final written warning
Gross misconduct or further
misconduct for which a final
written warning has been
received
Action short of dismissal:
• Transfer
• Demotion
• Suspension
Dismissal
• Reward deferment
Figure 12.1 Typical disciplinary procedure
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? serious incapability at work brought on by alcohol or illegal drugs;
? causing loss, damage or injury through serious negligence;
? a serious breach of health and safety rules; and
? a serious breach of confidence.
Recent research undertaken by Industrial Relations Services (IRS, 2005) is useful in
pointing to the reasons for disciplinary action. In a survey of over 100 employers
in all sector of the economy they found that the most likely issues for disciplinary
action were attendance, performance and capability, timekeeping and general behav-
iour and conduct. Clearly, most of these aspects are likely to fall into the minor/seri-
ous misconduct category so it is likely to be rare for employees to be dismissed for
gross misconduct. Regardless though of whether an employee is dismissed for
gross misconduct or repeated minor or serious misconduct a key point is that any
dismissal should follow due procedure, something that we now consider.
Employers need to ensure that disciplinary procedures are fully utilized to
ensure that any dismissal is considered ‘fair’, both in a legal and moral sense. For
example, an organization might consider it has acted ethically in dismissing an
employee, but even if an organization or individual acting on behalf of the organ-
ization has acted in good faith, an ET may decide the dismissal was unfair if the
correct procedure is not followed. Clearly, then, a key point in any dismissal is the
notion of whether the organization has acted in an reasonable, equitable and pro-
cedurally fair manner, if not then the organization could be faced with a claim for
unfair dismissal. In considering whether a dismissal is fair or unfair we should
firstly consider acceptable reasons for dismissal. Taylor and Emir (2006) note how the
number of potentially fair reasons was originally five as outlined in the Employment
Rights Act 1999, with a sixth being added under the Employment Relations Act
1999 and further reasons relating to Transfer of Undertaking Regulations (TUPE)
and mandatory retirement being added in 2006. The most likely reasons for dis-
missal though are likely to be (and see HRM in practice 12.1):
? Lack of capability: this may refer to when employees may encounter difficulties
in their performance and struggle to fulfil their responsibilities; alternatively
there may also be situations where an employee is unable to do their job due to
ill-health.
? Misconduct: as we noted above this can range from minor to gross misconduct
with differing sanctions.
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? Redundancy: the law in redundancy is quite complex, though in simple terms
a redundancy will arise when a business is closing, a workplace is closing or
there is a diminishing need for employees to do particular kinds of work in an
organization.
? Statutory bar.
? Some other substantial reason: this category is deliberately vague as it is intended
to give employers scope to dismiss employees in circumstances that were not
envisaged when the legislation was drawn up.
In further considering the notion of whether a dismissal is fair it is important to
recognize that there are a number of things which would be considered automat-
ically unfair regardless of the qualifying period, these being (LRD, 2006):
? Dismissal on grounds of pregnancy or assertion of paternal paternity or adoption
leave rights.
Review and reflect
To what extent is a course of the nature described in Box 12.1 ethical?
HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 288
HRM in practice 12.1 Prime candidates
for dismissal?
Rayner (1998) reports on the controversy created in the late 1990s when it emerged that
some local authorities were sending managers on a course to learn how to sack trouble-
some employees. The course was run by an American company, Padgett-Thompson.
Amongst other things the course offered participants advice on how to ‘deal with
employees who drive you crazy’ or good performers who had ‘know it all attitudes’. The
course also offered ‘a tried and tested technique for silencing employees who want to
argue about being dismissed’. In addition the course identified four employee types who
managers are likely to want to dismiss. These types were the chatterbox (who keeps
everyone away from work by constantly talking with colleagues), the plotician (who col-
lects the dirt on colleagues and enjoys manipulating those around them), the shark (who
enjoys making people squirm and chews up anyone who gets in their way) and the
snoop (who delves into other people’s personal things and private lives).
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? Dismissal on grounds of trade union membership or stating an intention to join
a trade union.
? Refusing to work on a Sunday (in the case of retail workers).
? Dismissal on grounds of actual or proposed trade union activity undertaken at
an appropriate time.
? Dismissal resulting from individual’s refusal to join a trade union.
? The dismissal of an employee without going through the required disciplinary
procedure.
? Dismissal connected with the transfer in the organization’s ownership – TUPE
(2006).
? Where no reason for dismissal is given.
? Where the employee has been unfairly selected for redundancy.
? Dismissal on basis of past criminal offence which is spent.
? Unfair dismissal on the basis of sex, race, disability, sexual orientation or
religion/beliefs.
? During the first 12 weeks of official industrial action (i.e. action sanctioned by a
trade union executive body).
? Asserting a statutory right, for example the national minimum wage (NMW).
? ‘Blowing the whistle’ on malpractice in the workplace.
? Refusal to do something on health and safety grounds.
In 2004–05 there were nearly 40000 claims for unfair dismissal submitted to the
Employment Tribunal Service (ETS, 2005). Of these, the vast majority were withdrawn
or settled with the intervention of ACAS. Ultimately, just over 7500 cases reached a for-
mal ET hearing. Of those cases that were heard by the tribunal service over 50 per cent
were dismissed, with 46.3 per cent being upheld (ETS, 2005). Clearly in assessing
the fairness or otherwise of the dismissal the ET will assess whether dismissal was
carried out in line with procedures (reiterating the need for organizations to have
well-established and transparent procedures related to disciplinary issues). To
judge whether a dismissal is fair the ET is likely to consider the following issues:
? Was dismissal for admissible reason?
? Was dismissal fair in sense of equity of treatment between employees?
? Was dismissal fair in the sense of the offence or the employee record justifying
the dismissal?
? Did the employer follow proper procedures?
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As noted above the success rate for employees in ETs is not very high, but if they
win their case then there are several options open to the ET. The first is the basic
award, which depends on length of service and age and is based on the same rate
as statutory redundancy pay (LRD, 2006):
? aged under 22: half a week’s pay for each complete year worked under this age;
? aged 22–40: one week’s pay for each complete year worked between these
ages; and
? aged 41–65: one and a half week’s pay for each complete year worked between
these ages.
In addition, there is also a compensatory award, which considers aspects such as
loss of earnings, loss of pension rights and the cost to an employee of time and effort
in seeking new work. In awarding a compensatory award the ET can also award an
amount that it considers ‘just and equitable’ given the circumstances (LRD, 2006).
Recent changes in the law now mean that there is no upper limit for cases where dis-
missal was based on discrimination, for health and safety or whistle blowing rea-
sons. For other cases the maximum compensatory aware is £58400 (LRD, 2006). In
2004–05 the highest award was £75250, though the median award was £3476 and
average award £7303 (ETS, 2005). The final option is either reinstatement (where the
employee gets their old job back) or re-engagement (where they are given a different
but comparable job). In reality, very few people take this option and in 2004–05 just
14 successful claimants chose this course of action (ETS, 2005).
Conclusion
The chapter has considered the need for a clearly articulated order in the organiza-
tion, particularly with regard to grievance and disciplinary procedures. Evidence
suggests that these issues may have a particular resonance within tourism and
hospitality; yet at the same time tourism and hospitality organizations often seem
to lack the formal policies which sustain a sound approach to towards these issues.
Although the predominance of small and medium-sized enterprises (SMEs) may
go some way to explain this lack of formal policies and procedures, legislation means
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that all organizations should now have well-established grievance and disciplinary
procedures. Establishment of such procedures mean that employees have a chan-
nel in which to express their dissatisfaction and employers a means by which to
articulate concerns about employee performance or behaviour. Though character-
ized as the ‘murky’ or ‘dark’ side of HRM, dismissal is an organizational reality
and all managers should be aware of what constitutes a fair or unfair dismissal.
Although a relatively small numbers of cases end up at the ET those that do may
lead to an organization facing significant costs for a badly handled dismissal. In
this way it is clear that rules and procedures in the employment relationship are
integral to ensure that decisions taken by organizations are both ethically and pro-
cedurally fair and a sense of natural justice prevails in the organizational setting.
References and further reading
Advisory Conciliation and Arbitration Service (2004) Disciplinary and Grievance Procedures Code of
Practice, ACAS.
Chartered Institute of Personnel and Development (2004) Managing Conflict at Work: A Survey of the UK
and Ireland, CIPD.
Chartered Institute of Personnel and Development (2005) Disciplinary and Grievance Procedures
Factsheet, CIPD.
Edwards, P. (2005) ‘Discipline and attendance’, in S. Bach (ed.) Managing Human Resources: Personnel
Management in Transition, Blackwell, 4th edition, 375–397.
Employment Tribunal Service (2005) Annual Report and Accounts 2004–05, The Stationary Office.
Industrial Relations Services (2005) ‘Disciplinary and grievance policies at work’, IRS Employment Review,
No. 825, 10 June, 9–18.
Kersley, B., Alpin, C., Forth, J. et al. (2006) Inside the Workplace: Findings from the 2004 Workplace
Employment Relations Survey, Routledge.
Labour Research Department (2006) Law at Work, LRD.
Marchington, M. and Wilkinson, A. (2005) Human Resource Management at Work: People Management
and Development, 3rd edition, CIPD.
Pigors, P. and Myers, C. S. (1977) Personnel Administration, McGraw Hill, 8th edition.
Price, L. (1994) ‘Poor personnel practice in the hotel and catering industry – does it matter?’, Human
Resource Management Journal, 4(4), 44–62.
Rayner, J. (1998) ‘Bolshie staff? We have ways of purging them’, Observer, 13 December, 6.
Salamon, M. (1992) Industrial Relations – Theory and Practice, Prentice Hall.
Salamon, M. (2000) Industrial Relations – Theory and Practice, 4th edition, Prentice Hall.
Salipante, P. and Bouwen, R. (1990) ‘Behavioural analysis of grievances: conflict, sources, complexity and
transformation’, Employee Relations, 12(3), 17–22.
Taylor, S. and Emir, A. (2006) Employment Law: An Introduction, Oxford University Press.
Torrington, D., Hall, L. and Taylor, S. (2005) Human Resource Management, 6th edition, Prentice Hall.
GRI EVANCE AND DI SCI PLI NARY PROCEDURES 291
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Websites
ACAS has a number of useful resources at http://www.acas.org.uk/index.aspx?articleid?360&detailid?548
The Department of Trade and Industry’s page on dispute resolution can be found at http://www.dti.gov.uk/
employment/Resolving_disputes/index.html
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Chapter 13
Concluding comments
293
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 294
This book has sought to offer a comprehensive review of competitive strategies, and
concomitant HRM practices in the international tourism and hospitality sector. It
has painted a complex picture of the sector, and particularly the differing routes
to competitive advantage which organizations may adopt. Clearly, the book has
demonstrated that it is virtually impossible to entirely generalize the employment
experience in tourism and hospitality. In particular, the extent to which organizations
may be aspiring to best practice HRM remains a point worthy of further debate and
research.
Clearly recognition of this point has a major impact on the nature of work,
employment and people management in tourism and hospitality industry. In that
sense from a HRM point of view, in crude terms, there is much evidence to support
an approach in the tourism and hospitality sector to HRM which is more ‘best fit’
than ‘best practice’. Marchington and Grugulis’ (2000: 1121) view that ‘best prac-
tice, it seems, is problematic’ is certainly borne out by the tourism and hospitality
sector. Much as policy-makers would like the sector to be characteristic of a high
wage, high skill, high quality, high value-added approach, clearly the low and
mixed skill context of the tourism and hospitality sector a more nuanced approach
is called for. Large numbers of tourism and hospitality employers do not necessar-
ily need to look to develop high value added approaches. As a consequence, high
value added approaches have to be seen in relation to ‘a broader package of envir-
onmental, cultural and structural features that can nurture and support high per-
formance, high value added industries and sectors’ (Keep and Mayhew, 1999: 4).
These conditions do not exist universally across the tourism and hospitality sector
and resultantly the ‘best fit’ approach of designing HRM practices which are con-
tingent upon the particular customer definition of ‘good service’ would seem
apposite. Notions of ‘good service’ will differ markedly across market segments
and between tangible and intangible aspects of the tourism and hospitality prod-
uct. Given this reality, practices which may be desirable to employees such as
levels of high pay, extensive training and job security, are not necessarily cost effect-
ive for many tourism and hospitality organizations, a point which Riley et al.
(2000) strongly advocate in their arguments about economic determinism. In this
sense then the ‘poor’ personnel practices of tourism and hospitality organizations
that are noted by a number of authors may reflect any number of reasons. However
it is important to stress that there is still an element of choice for employers and
claims to the immutability of ‘poor’ personnel practice should be treated with
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CONCLUDI NG COMMENTS
some caution. As the DfEE (2000: 13) notes in describing employment practices in
the sector:
Some of these deficiencies reflect labour market circumstances, commercial
constraints and lack of awareness of options, but some reflect poor human
resource management, unwillingness to take risks or invest in innovation
and short termism: most vividly exemplified by the low pay, crisis manage-
ment culture of the less impressive establishments.
Equally, though, there is clearly some evidence for good practice HRM in the tourism
and hospitality industry and the book has sought to highlight such practices through-
out. An obvious question stemming from this recognition of good practice, which we
have sought to answer is: if best practice does exist, what does it look like? More often
than not it is likely to be large, often multinational organizations who exemplify a
number of the practices, as described by the likes of Hoque (2000) and illustrated by
a number of examples in this book. Indeed, recognizing the nature of the small and
medium enterprise (SME) sector it may well be that notions of best practice need to
reconfigured within this particular sector. As Worsfold (1999: 346) notes, ‘In the case
of small hotels we may need to abandon the search for formal HRM approaches and
attempt to establish whether “caring management” can provide the “concern for
employee well being” which appears to be linked to service quality.’
Generally, whilst this book concludes that the HRM strategies of firms are heav-
ily shaped by contextual contingencies, including national, sectoral, organizational
and occupational factors, and therefore are more redolent of best fit, such a conclu-
sion does not necessarily invalidate best practice thinking. For example, Haynes
(1999: 200) argues that in relation to best practice HRM in the hospitality sector:
Sometimes the critical verges on the hysterical … In an industry characterized
by relatively low levels of pay and high levels of arbitrary management prac-
tice, the adoption of many of the HRM practices in question would undoubt-
edly improve the work experience of hospitality workers. For that reason
alone the model should not be rejected out of hand by hospitality researchers.
As Boxall and Purcell (2000: 1930) suggest ‘… there are certain broadly applicable
principles and processes of good labour management.’ The diffusion of these practices
295
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HRM HOSPI TALI TY AND TOURI SM I NDUSTRI ES 296
as best practice does remain problematic and difficult to achieve throughout the
tourism and hospitality sector. However, the fact that diffusion of these sorts of
practices is potentially limited does not invalidate their utility. Thus, although the
‘deluxe’ version of best practice may remain out of reach of large numbers of
tourism and hospitality organizations, at the very least there should be aspirations
to at least go for the ‘economy’ version to offer a more rewarding and meaningful
employment experience for the many who work in the sector.
References
Boxall, P. and Purcell, J. (2000) ‘Strategic human resource management: Where have we come from and
where should we be going?’, International Journal of Management Reviews, 2(2), 183–203.
Department for Education and Employment (2000) Employers Skill Survey: Case Study Hospitality
Sector, DfEE.
Haynes, P. (1999) ‘A new agenda for researching hospitality HRM: comment on Lashley and Watson’,
Tourism and Hospitality Research, 1(3), 199–204.
Hoque, K. (2000) Human Resource Management in the Hotel Industry, Routledge.
Keep, E. and Mayhew, K. (1999) ‘The assessment: knowledge, skills and competitiveness’, Oxford Review
of Economic Policy, 15, 1–15.
Marchington, M. and Grugulis, I. (2000) ‘“Best practice” human resource management: perfect opportun-
ity or dangerous illusion?’ International Journal of Human Resource Management, 11(6), 1104–1124.
Riley, M., Gore, J. and Kelliher, C. (2000) ‘Economic determinism and human resource management prac-
tice in the hospitality and tourism industry’, Tourism and Hospitality Research, 2(2), 118–128.
Worsfold, P. (1999) ‘HRM, performance, commitment and service quality in the hotel industry’,
International Journal of Contemporary Hospitality Management, 11(7), 340–348.
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360-degree feedback, 183
Absence
alcohol/drug misuse, 252–254
causes, 245
management, 243–247
organization policy, 245
proactive approaches, 247
review interview, 246
Accor Group, 231
Adaptive culture, need for, 64
Adult minimum wage, comparison, 205
Advertising agencies, 98–100
recruitment advertising, judging
criteria, 99
Advisory Conciliation and Arbitration Service
(ACAS) code of practice, 281
on disciplinary procedure, 284–285
on grievance procedure, 283
Aesthetic labour, 93, 95–96
Aesthetics, 58
Age-diverse workforce steps, 132
Age Diversity in Employment, 131
AIDS/HIV, 247–252
age composition and accommodation, 248
homosexual males, 248
organizations policies, consideration aspects,
252
policy responses, 251–252
potential response
bounded rationality response, 250–251
rational response, 250
subjective response, 251
public fears, 249
public misperceptions, 250
sexual activity, in tourism industry, 249
work nature, 248–249
Air rage, 273
proactive response, 274
Alcohol/drug
developing policy, 254–256
drug abuse, 253, 254
misuse, 252–256
testing, 256
Americo, 32
ANO hotels, rhetoric and reality of appraisal,
178
Anti-discriminatory legislation, 123
Appraisal, in practice, 14, 172–185
appraisal form, 184
appraisal interview, 184–185
approaches, 182–183
individual performance, 181
practicalities, 177, 183–185
problems, 175–176
reasons for, 172–173
rhetoric and reality, in ANO hotels, 178
schemes, 177
talking points, 179
views, 174–175
negative, 175
positive, 174
Apprenticeships, 151
Aptitude test, 108
Artefacts and creations, 57
Asia, 40
Assessment centres, 101, 109
easyJet, 110
Association of British Travel Agents (ABTA), 197
Assumptions, 57, 62
Attitude survey, 230
Attitudes, 57, 62, 122
Australia, 44, 226, 265
Bain, George, 200
Bazooms, 262
Behaviour, 54, 61–62, 63, 248, 258, 259, 262–263,
264
297
Index
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Behaviourally anchored rating scales (BARS),
180
Belgium, 45
Beliefs, 57, 62
Best fit, 11–13
vs. best practice, 10–11
Best practice, 10–11, 13–15, 20–21
Bickerstaffe, Rodney, 201
Black and minority ethnic people, employment
experience, 117–119
Blatcherism, 223
British Airline Pilots Association (BALPA), 256
British Airways
religious discrimination, 131
tackling absence, 246
British Hospitality Association (BHA), 18, 200
Café Pasta, 235
‘Cafeteria’ approach, 137, 189
Canada, 155
Caterer and Hotelkeeper, 192, 271
Centricity, impact of, 30–31
Chartered Institute of Personnel and
Development (CIPD), 99, 132, 150, 170,
183, 218, 222, 236, 244, 281
China, 46, 233
Club Med, 236
Cold pricklies, 61
Collective approach, 220, 221
Commercial hospitality industry, 5, 199
Commission for Equality and Human Rights
(CEHR), 133
Commission for Racial Equality (CRE), 109, 124
Company paternalism, in welfare policy, 243
Competitive advantage, 8
Competitive strategies, 15, 16
Complaint, 263, 282
Conflict, 216, 282
Conflict resolution, 219–222
Content validity, 110
Core and peripheral employees, 81
Corporate architecture, 57
Corporate conscience, in welfare policy, 242
Corporate culture, 32, 33, 54, 55
Corporate identity, 58
Corporate stories, 60
Cost reduction strategy, 11–12
Country-of-operation, 41
Country-of-origin, 37–39
generalizations, 38, 39
Coupland, Douglas, 2, 194
Covey, Stephen, 174
Cultural phenomenon, in organizations, 57
Culture, in IHRM, 41–43
individualism, 42
masculinity, 42
power distance, 41
uncertainty avoidance, 42
see also organizational culture
Customer appraisal, 182
Customer surveys, 182–183
Deming, W. Edwards, 174
Dermody, Paul, 192
Designer restaurant, 19
Direct discrimination, 124
Disability Discrimination Act (Amendment)
Regulations 2003, 123
Disability Discrimination Act (DDA), 126,
251
Disability Discrimination Act 1995, 123
Disability Discrimination Act 2005, 123
Disability, perception, 120
Disability Rights Commission (DRC), 124,
133
Disabled employees, experience, 119–120
two-ticks scheme, 120
Disciplinary procedures, 284–290
ACAS code of practice, 284–285
discipline, definition, 281
Dismissal, 287–289
reasons for, 287–288
unfair conditions, 288–289
Disney, use of language, 60
Dissatisfaction, 282
Diversity management training initiatives
(DMTIs), 135
Diversity oriented organizations, 136–137
Dorchester Hotel, organizing failure in, 225
Downward communication, 229–230
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Drinking see alcohol/drug
Drug see alcohol/drug
E-learning, 162
EasyJet, assessment centres, 110
Economics, 17–18
Edmonds, John, 192
Employee assistance programmes (EAPs), 254,
271
Employee–employer views, of pay
employee objective
composition, 191
felt to be fair, 190
purchasing power, 189–190
recognition, 191
relativities, 190–191
rights, 190
employer objectives
change management, 194–195
competition, 193
control, 193
cost, 194
motivation and performance, 193
prestige, 191–193
Employee involvement, 14, 228–233
Employee participation, 234
Employee relations, 14, 217–222
conflict resolution, 219–222
frames of reference, 218–219
Employment Act 2002, 75, 281
Employment Equality (Religion or Belief)
Regulations 2003, 123
Employment Equality (Sex Discrimination)
Regulations 2005, 123
Employment Equality (Sexual Orientation)
Regulations 2003, 123
Employment experience
black and minority ethnic people, 117–119
disabled employees, 119–120
older workers, 121–122
women, 116–117
Employment-related legislation, 75
Employment Relations Act 1999, 75, 222, 287
Employment Relations Act 2004, 222
Employment Rights Act 1999, 287
Employment tribunal (ET), 115, 124, 126, 127,
289–290
basic award, 290
compensatory award, 290
Empowerment, 232, 233
Environmental conflict, 282
Equal opportunities, 114, 243
employment experience, 116–122
legislative response, 122
managing diversity, 133–137
Equal Opportunities Commission (EOC), 109,
124, 133
Equality and diversity
business aspects, 115
ethical aspects, 115
key issues, 116
legal aspects, 115
Equality Act 2006, 133
Ethnocentric approach to internationalization,
28–29, 30
EU, 40, 71, 72, 73, 74, 131, 236, 244, 253, 275
EU expansion
labour and skill shortages, solutions, 73
EU Social Chapter, 74
European Court of Justice (ECJ), 271–272
European social model vs. Anglo-Saxon
approach, 73–74
European Works Councils (EWCs), 234–237
External fit, ensuring method, 8
External labour market, 96
national, 72–76
sectoral, 76–80
transnational, 72
External off-the-job training, 162–163
Face validity, 110
Feedback, 110–111, 182–183
Feminization, in labour market, 75
Fiddles and knock-offs, 209
First Choice Airways, 198, 210
Flexible firm model, core and peripheral
employees, 81
Flirting, 208, 260–261
France, 207, 236, 265
Frenco, 32
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Front-line tourism and hospitality employee, 59,
93–104
Functional flexibility, 81–83
Genuine Occupational Qualification (GOQ), 126
Geocentric approach to internationalization, 28,
29–30, 36
human resource profile, 31
George, Peter, 192
Germany, 43, 144, 145, 203
Glasgow, 95
Global economy, American dominance of, 40
Global hotel industry, orientations in, 32
Grievance procedures, 281–284
ACAS code of practice, 283
conflict, 282
degrees, of discontent, 282
grievance, definition, 280–281
Guest Service Staff (GSS) training, 97–98
Hard HRM, 83–84
vs. soft HRM, 9–10, 169
Health and Safety at Work Act (HASWA) 1974,
267
Health and Safety Executive (HSE), 266, 268–269
Health and Social Care (Scotland) Act, 266
Heroes, 60
Hilton International, Fast-track Elevator
programme, 101
Hologram, 8, 20
Hooters, 262
Hotel, Catering and Tourism Sector (HCTS), 3
HRM
best fit, 11–13, 294
best fit vs. best practice, 10–11
best practice, 13–15, 20–21, 295–296
convenient shorthand term, 7
cycle, 16
definitions, 7–9
hard vs. soft, 9–10
airline industry, 10
label, 7
Manipulative device, 8
Map, 8
models and reality, 15–17
pessimistic view, 17–19
personnel problems, 17
HRM quality enhancer hotel, 21
Human resource development (HRD), 142
Human Rights Act 1998, 123, 256
In-company off-the-job training, 160–162
In-company on-the-job training, 160
In-tray exercise, 109
Income Data Services (IDS), 202
Indirect discrimination, 124
Individual performance, measuring
criteria, 181
factors, 181
Induction crisis, 161
Industrial relations, 217–222
Industry level, 152–153
Information and Consultation of Employees
(ICE) Regulations 2004, 236–237
Innovation strategy, 11
Institute of Professional Advertisers (IPA), 99
Institutional perspective, 43–44
Intelligence test, 108
Intermediaries, 4
Internal fit, ensuring method, 8
Internal labour market
and flexible labour utilization, 80
functional flexibility, 81–83
numerical flexibility, 83–84
International hotel industry, American
dominance of, 40
International human resource management
(IHRM), 7, 26
emergence, 27–28
centricity, 30–31
country-of-operation, 41
country-of-origin, 37–39
culture, importance of, 41–43
institutional perspective, 43–44
international managers role in, 33, 35–37
international staffing, 32–33
Perlmutter’s work attempts, 28–30
MNCs and HRM policies and practices, 44–46
International Labour Organization (ILO), 6, 18,
223
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International managers, role in IHRM, 33, 35–37
International staffing, 32–33
host-country nationals (HCNs), 32, 33, 34
parent-country nationals (PCNs), 32, 33, 34
third-country nationals (TCNs), 32, 33, 34
Interpersonal skills, 93, 94
Interviewing, 105–111
Investors in People (IiP), 147–150
principles, 148, 149
Italy, 125, 203, 244, 265
Japan, 38, 144
Job analysis, 90–91
Job description, 91, 150, 180, 191
Job security, 14, 233
Jurys Inns, recruitment and training strategy,
97–98
Kelleher, Herb, 60, 61
Labour market, 71
external market, 71–72, 80, 96
national, 72–76
sectoral, 76–80
transnational, 72
internal market, 71–72, 80, 96
functional flexibility, 81–83
numerical flexibility, 83–84
Labour supply
challenges, 71
in hotel sector, 84
Language, 59
usage, in Disney, 60
Legalistic-reactive approach, in welfare policy, 242
Legislative response
anti-discriminatory legislation, 123
jobs for girls, 125
physical/mental impairment conditions, 127
policy responses, for lesbian and gay, 129–130
religious discrimination, British Airways, 131
response to disability, 127
visually impaired employees, responding to
the needs, 129
Living wage, 202
Long-term absence, 244–245
Low pay, history, 198
Low Pay Commission (LPC), 200, 201, 203
Low Pay Unit (LPU), 200, 201
Lufthansa, social partnership in, 220
Luxury hotels and employment experience, 78
Mallorca, 199, 249
Managerial Thatcherism, 223
Managing diversity, 133
definitions, 134
diversity management training initiatives
(DMTIs), 135
diversity oriented organizations, 136–137
and equal opportunities, differences, 135
Mandatory retirement, 287
Marginal workers, 6–7, 22, 77
Market-driven approach, 8
Marriott Marble Arch, Discovery cross-training
scheme, 82
Mass service, 12–13
Material objects, 57
McDonald’s, 12, 13, 40, 44, 58, 63, 194, 205
McGregor, Douglas, 174
McJob, challenging perceptions, 194
Mentoring, 160
Metaphors, 59, 61, 219
Mission statement, 57–58, 161
Models and reality, 15–17
Modern Apprenticeships see apprenticeships
Morris, Bill, 201
Multinational companies (MNCs), 72
and HRM policies and practices, 44–46
Multi-rater feedback see 360-degree feedback
Munro Fraser five-fold grading system, 92–93
‘Mystery’ or ‘phantom’ shopper, 183
Myths, 60
from hospitality entrepreneurs, 62
National labour market, 72–76
National Minimum Wage (NMW), 195, 199–200
evolution, in UK, 204
in leisure industry, 193
National Minimum Wage Act, 75, 200
National skill-creation system, 145
National Vocational Qualification (NVQ), 97, 132
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National works councils, 234–237
National/Scottish Vocational Qualifications
(N/SVQs), 146–147
Needed role behaviours, 11–12
The Netherlands, 45, 265
New Zealand, 207
Norway, 75, 125, 265
Numerical flexibility, 83–84
Off-the-job training
external, 159, 162–163
in-company, 159, 160–162
Older workers, employment experience,
121–122
ability vs. inability, 121
Oliver, Tom, 192
On-the-job training (OJT), in-company, 160
Online recruitment, 100–102
Opportunity Now, 118, 119, 120
Organizational culture, 51
adapting, failure, 64
aspects/elements, 56
competing views, 53
optimists, 53
pessimists, 53–55
realists, 55–56
definition, 51–53
and HRM, 65
contradictions and dilemmas, 66
as Orwellian mechanism, 55
and performance
adaptive culture need, 64
contingent view, 64
reverse relationship, 64
strong culture thesis, 63
phenomenon, 57
at Pizza Hut, 61
recognition, 52
at Regent hotel, 54
Organizational strategies, 14
Organizing failure, in Dorchester Hotel, 225
Orwellian mechanism, 55
Padgett-Thompson, 288
Parental Leave Directive, 74
Part-time employees, regulations on, 75
Pay determination, influences on, 195, 196–197
Pay disparities, 192
Peer appraisal, 182
People 1st, 3, 152
Performance appraisal, 169
definition, 170–171
nature of, 170–172
parameters, 171
in practice see appraisal, in practice
Performance management system (PMS), 169
aims, 169
managing poor performance, 185–186
nature of, 170–172
Perkins, Steve, 235
Perlmutter, Howard, 28–30
work attempts, 28–30
ethnocentric approach, 28–29
geocentric approach, 28, 29–30
polycentric approach, 28, 29
Person/job interaction, 105
Person specification/competency profile, 91–92
Munro Fraser five-fold grading system, 92
Rodger seven-point plan, 92
shortlisting, 103–104
Personality test, 108–109, 110
Personnel problems, 17
Pessimistic views, of HRM, 17–19
Physical/mental impairment conditions, 127
Pilot Change Agenda, 210
Pizza Hut, 73, 203
metaphor usage in, 61
PizzaExpress, 203, 235
Pluralist perspectives, employee relations,
219–220
Polycentric approach to internationalization, 28,
29, 30, 35
Pontins, 150
Poor performance, management of, 185–186
Predictive validity, 110
Presentation skills, 109
Professional practices set, 8
Professional service, 13
Prosser, Sir Ian, 192
Psychometric test, 21, 101, 106, 108, 109, 111
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Quality circles (QCs), 231
Quality enhancement strategy, 11
Race for Opportunity (RfO), 119, 131
Race Relations (Amendment) Act 2000, 123
Race Relations Act (RRA), 121
affirmative action see positive action
Genuine Occupational Qualification (GOQ),
126
positive action, 125
Racial equality, practical steps, 119
Range of surveillance techniques, 183
Realistic recruitment, in cruise industry, 103
Realists, 55–56
Recruitment, 14
advertising agencies, 98–100
definition, 90
front-line tourism and hospitality employee,
93–104
job analysis, 90–91
job description, 91
online recruitment, 100–102
person specification/competency profile, 91–92
Munro Fraser five-fold grading system, 92–93
Rodger seven-point plan, 92
realistic recruitment, in cruise industry, 103
shortlisting, 103–104
skills required, 89
sources, 102
Regent hotel culture, 54
Rehabilitation of Offenders Act 1974, 123, 132
Remuneration
basic or base pay, 196–199
wage regulation, 199–206
Retention, 14
Reward strategies, 189
benefits, 210–211
employee–employer views of pay, 189–195
fiddles and knock-offs, 209
for quality, 14
remuneration, 196–206
tipping practice, 206–209
Robinson, Gerry, 192
Rodger seven-point plan, 92
Russia, 46
Scotland, 73, 95–96, 151, 266
Scotland with Style, 95–96
Scott, Amanda, 150
Sector Skills Council (SSC), 3, 152
Sectoral labour market, 76–80
Selection, 14, 104–111
assessment centres, 109
criteria, 105
definition, 104
reliability, 109–110
techniques
aptitude test, 108
in-tray exercise, 109
intelligence test, 108
interviewing, 105–108
personality test, 108–109
presentation skills, 109
problem-solving, 109
psychometric testing, 108
two-way process, 105
validity, 110
Self-appraisal, 182
Service factory, 12
Service organizations, 58, 59
Service shop, 12
Sex Discrimination (Gender Reassignment)
Regulations 1999, 123
Sex Discrimination Act (SDA), 124
affirmative action see positive action
Genuine Occupational Qualification (GOQ), 126
positive action, 125–126
Sexual activity
in tourism industry, 249
in workplace, 257–258
Sexual harassment, 256–264
in airline cabin crew, 261
breeding ground, 259–263
developing policy, 263–264
flirting, 260–261
Hooters, 262
of hotel workers, 260
prevention, reasons for, 258
Shadowing, 160
Short-term absence, 244, 246
Shortlisting, 103–104
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Singapore, 44, 45
‘Sitting next to Nellie’, 160
Small- and medium-sized enterprises (SMEs),
171, 224
SMART mnemonic, 173
Smile supervisors, 63
Smoking, 264–266
global curb, 265
Social partnership, in Lufthansa, 220
Social relational grievance, 282
Social skills, 93, 94
Social substantive grievance, 282
Soft HRM, 84
vs. hard HRM, 9–10
Spain, 265
Stories, 60
from hospitality entrepreneurs, 62
Stress, 266–270
control, 268
demands, 268
developing policy, 270
negative effects, 267
organizational change, 269
relationships, 268–269
role, of employees, 269
standard policy, 270
support, 268
Strong culture thesis, 63, 64
Students, 6
Superhost, 153
Swedco, 32
Sweden, 144, 265
Sydmonds, James, 235
Symbols, 58
Talking points, in appraisal, 179
Teamwork, 14
Temporal flexibility, 83
‘Them and us’ attitude, 219, 220, 231
Thomas, David, 192
Tiger Tiger, recruitment process in, 100
Tipping practice, 206–209
in different countries, 207
motives, 208
research reports, 208
Total quality management (TQM), 155,
231–232
Total Rewards System, 196, 210
Tourism sector, sub-sectors, 3–4, 5
TQM see total quality management
Trade union, 220, 221
in Australia, 226
conflict in British Airway, 227
in UK, terminal decline, 222–228
reasons, 224–225
in US, 226
Trade Union and Labour Relations
Consolidation Act 1992, 74
Trade Union Reform and Employment Rights
Act 1993, 74
Training, 141, 153
apprenticeships, 151
benefits, 154–155
conducting, 157, 163
dichotomy, 153–157
evaluating, 164
industry level, 152
instruction methods, selecting, 159–163
external, off-the-job, 162–163
in-company, off-the-job, 160–162
in-company, on-the-job, 160
investors in people, 147–150
cost, 150
levels of analysis, 143
N/SVQs, 146–147
national level responses, 142–146
national skill-creation systems, 145
needs, assessing, 158
objectives, 159
plan, 164
completion, 163
preparation, 158
Pontins training, 150
programme designing, 159
and TQM, in restaurant industry, 155
VET policies and practices, 144
Training and development, 14
Transfer of Undertaking Regulations (TUPE),
287
Transnational labour market, 72
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Travel and Leisure Industry Salary Survey
(1997), 192
Troublesome employee, 288
Two-way communication, 230
UK, 5, 6, 38, 73, 74, 76, 95, 106, 121, 122, 125, 131,
143, 144, 145, 146, 203, 220, 238, 244, 252,
257, 266, 270, 271, 272
Unitary perspectives, employee relations, 219
Upward appraisal, 182
Upward problem-solving, 229, 230
US, 38, 39, 40, 62, 73, 74, 131, 135, 144, 145, 206,
207, 226, 248, 253, 265
Validity, of selection procedure
content validity, 110
face validity, 110
predictive validity, 110
Values, 41, 57, 62, 64
Virtual psychologist, 101
Visually impaired employees, responding to
needs, 129
Vocational education and training (VET),
policies and practices, 144–145
Wages Act 1986, 74
Warm fuzzies, 61
Welcome Host, 153
Welfare policies, 242, 243, 254
absence management, 243–247
AIDS/HIV, 247–252
alcohol/drug misuse, 252–256
rationales, 242–243
sexual harassment, 256–264
smoking, 264–266
stress, 266–270
working time, 270–273
workplace violence, 273–274
Wellness management, 245, 247
Women
barriers for, 117
employment experience, 116–117
Work, as leisure, 199
Working time, 270–273
of EU, 270
excessive hours, 271
of UK, 270–271
Working Time Regulation (WTR), 271–272
Workplace, 171
air rage, 273, 274
with sexual simmer, 260
violence, 273–274
Workplace Employee Relations Survey data,
172, 224
Works councils, 234–235
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