Two
of Related Literature and Studies
from various sources gathered from published articles and previous studies that
are relevant in the direction of the study.
of Related Literature
of employment in the private sector, such as matters of hiring, work schedules,
wages, and so forth, in
Arabia
the Labour and Workman Law was
passed. The 1969 legislation covered the issues on hiring, termination,
disciplinary actions, records and reports, hours of work, leave, wages and
supplemental payments, withholding and deductions, pay changes, payment of
wages, health, safety, workers’ compensation and social security, as well as
other important issues concerning the protection of women, children and
disabled workers. It also remains the basic law regarding employment in
(Montana and Roukis, 1986) The following paragraphs give a brief account of the
1969 legislation on the concerns of hiring, termination, disciplinary actions,
hours of work, and wages.
offices were established as a result of the 1969 legislation. Functions of
these employment offices include: keeping records of job applicants and
vacancies; referring workers to employers; advising workers on opportunities
for vocational training; and assisting workers in changing jobs or places of
work. Under this legislation, employers are required to report existing job
vacancies and newly created jobs to these employment offices. Also, the
contract between employer and individual employee, which include regulation of
probationary hiring and termination, was also covered. This legislation also
decrees among all companies that the labour force in a company must be
constituted of 75% Saudis (preferential hiring of Saudi Arabians).
necessary approval from the ministry of labour must be obtained, as well as the
work permits, while an employer who wishes to hire foreigners must acquire
permission from a government labour office.
(Montana and Roukis, 1986)
termination, the 1969 law decreed that an employee cannot be dismissed without
valid reasons or due to management authority or privileges. In case of
separation from the company, either due to end of contract or cancellation of
contract on unspecified time, the employer is required to give severance pay,
may the employee be a Saudi or non-Saudi. In the case of surplusing, or when a non-Saudi employee’s work with the company is
ended and is replaced by a qualified Saudi, it has been customary to give a
lump sum to the displaced personnel. Also, advance notice of lay-off is
customarily given. (Montana and Roukis, 1986)
the 1969 law provides for a careful specification of fines and disciplinary
procedures. Employers may not impose any penalty for an offence not listed in
the rules, and a penalty may be imposed only after the worker's defence has
been heard. Further, the worker has the right of appeal to the Preliminary
Commission, which will give its decision within one week after the hearing. A
worker may contest any disciplinary action by direct appeal to the local labour
office. In addition, the regulations under the 1969 legislation require that
the employer "treat his workmen with
due respect and refrain from any work or deed that may affect their dignity or
religion." (Montana and Roukis, 1986, p. 98)
hours of work, a basic eight hour workday and forty-eight hour (or six day)
workweek had been established in the 1969 regulations. During Ramadan, hours of
work had been reduced to a six-hour and thirty-six hour week. For seasonal or
non-continuous work, a nine-day hour must be approved; there is a need for
definition of these industries and categories of workers by the minister of
labour. For government offices, most favour a forty-hour, five-day work week,
with Thursday and Friday as their 2-day weekend. In a work day, a maximum of
five consecutive hours may be worked, while rest, meal and prayer intervals
must not be less than one and a half hour. Also, a worker is should not stay at
the workplace for more than eleven hours in a day, and shift schedules are
regulated by the minister of labour. Except for some special cases with waiver,
the number of working hours must not exceed to ten in a day. Finally, a close
attention must be given to the religious requirements in the work place,
because they are protected by the law. Violations against any provisions
regarding the hours of work are fined. (Montana and Roukis, 1986)
on the issue of wages, the rate of wages in
and demand of labour needed. There is no uniform wage even though the 1969
regulations provide for minimum wage determination. “By tradition, the minimum
wage is subject to negotiation and agreement between the employer and the
government. Wages usually have been determined by company regulations, labour
contracts, accepted practices in the trade, and the location where the work is
to be done. Nevertheless, wages paid for semi-skilled and skilled workers in
generally have been higher than in many of the other Arab countries.” (Montana
and Roukis, 1986, p. 101)
preceding discussion was important to the course of the study, because it gave
an overview of the basic issues of employment in
regulates these issues.
discussed in his article “Inventing a
working class in
the Saudiazation program of the
of
Saudiazation is a program that aims to replace foreign labour force with as
many qualified Saudis as possible. In relation, Kronemer said that nine out of
the ten private sector jobs are filled in by foreigners not because foreigners
are more favoured, but it resulted from the years 1970s and 1980s, when there
was a little need for a Saudi working class. It was during those years when oil
had high prices that the government have adequate funds to pay foreign labour
pool to construct the country, while most Saudis are given sheltered government
jobs. In other words, Saudi then was “nation building without getting the
citizens’ fingernails dirty.” (Kronemer, 1997, p. 29+)
continue this practice due to a decade’s low oil price and low per capita
income (only $6,700 from $21,000 per capita in 1981 due to oil boom). As a
result, government subsidies are reduced, and the government could not afford
anymore to guarantee a government position for Saudis who want it. In response
to these problems, the government launched Saudiazation. Through Saudiazation,
the kingdom tries to build a Saudi Arabian working class that is absent from
the region. Yet, to accomplish this huge task, “the government races against
time, and, in a sense, space, in as much as
nurtured work a culture with a strong distaste for the kinds of work found in
most manufacturing and office-support jobs.” (Kronemer, 1997, p. 29+)
taught the necessary technical skills and work ethic so as to be competitive
globally. However, there are big problems in work ethics that the program has
to face: absenteeism, tardiness and work effort.
“to social patterns formed over a millennia of desert life”. (Kronemer, 1997,
p. 29+)
in which less than 1 percent of the land is arable, most of the population was
historically involved in a nomadic lifestyle. Some Saudis followed the scant
rain patterns of the region with the herds of goats and sheep that were their
means of survival. Others owned camels and were involved in trade, or ruled
areas of the desert where they could seize parts of any caravan or herd that
passed through as payment for travelling over the land. Out of this harrowing
but unencumbered lifestyle, the traditional virtues of the desert developed:
The importance of interpersonal relationships, the idea of approximate rather
than precise time, and the aversion to any behaviour that might seem menial or
servile. It has made for a population that is not naturally suited to the
routines of a 40-hour-per-week job, or to many occupations that require working
with one's hands or performing service or support duties. Particularly
regarding absenteeism and tardiness, these desert values make it difficult for
an individual to accept the control of a clock over the daily rhythms of one's
personal life. The real challenge for Saudiazation is transforming these
cultural attitudes into ones more compatible with the requirements of modern
manufacturing and business.” (p. 29+)
preceding sections presenting the unemployment problems of
are relevant to the study because they gave an overview of the working
behaviour of Saudis, and this may help in the analysis as to why more Saudis
prefer non-traditional jobs than technical jobs like the ones in Saudi Arabian
Airlines.
this section, we will look on employee turnover: the reasons for turnover,
consequences of turnover, and the possible solutions for turnover (or at least
preventing it).
labour market, may it be between firms, jobs and occupations, or between the states
of employment or unemployment, is called as turnover. (Burgess, 1998)
Accordingly, turnover is one of the most significant causes of declining
productivity and sagging morale in both the public and private sectors. (Abassi
and Hollman, 2000, p. 333)
Accordingly, excessive turnover may lead to jeopardy of the organization’s
objectives. It may negatively affect innovation and cause major delays in the
delivery of services and introduction of new programs. It may also lead to loss
of key employees, which, in turn may have negative impact on the quality and
innovation of services delivered, which in turn, may negatively affect the
satisfaction of customers of some departments or government agencies. For some
government agencies or departments, customers include not only those people who
consume services, but also the employees working in their offices. (Abassi and
Hollman, 2000)
discussed: “Employee loyalty is the underpinning of customer satisfaction with
the organization. An enthusiastic and loyal employee will nurture productive
working relationships with customers. Consequently, it is better for an
organization to keep experienced and productive employees to hire new ones. However,
to get and keep loyal workers, the organization must have a long run time
horizon. It must invest in its employees through training programs and value
them through strong organizational vision. In the face of eroding loyalty,
attracting and keeping good people is the key to strategic staffing in all
industries and sectors.” (p. 333)
all-encompassing and expensive. “The cost of replacing a worker is often
underestimated, because in addition to visible costs…there are many
"hidden" costs and consequences of turnover. They include disruption
of customer relations, the vacancy cost until the job is filled, costs
resulting from disruption of the work flow, and the erosion of morale and
stability of those who remain. Further, there is the temporary loss of
production and valuable time taken from customer relations while the new hire
acquires job skills and achieves maximum efficiency.” (Abassi and Hollman,
2000, p, 333)
practices, managerial style, lack of recognition, lack of competitive
compensation scheme and toxic workplace environment are some of the major
reasons for employee turnover. (Abassi and Hollman, 2000)
should be constructed that meets not only the criteria needed to be able to
recruit employees that possess the skills needed by the organization, but also,
criteria that will meet or is consistent with the strategies and culture of the
organization.
background, and training of managers appear to have a significant impact on the
problem of turnover. “Studies show that the backgrounds of managers profoundly
impact the mobility of people who work for them. A company's work environment
is a reflection of the personality and philosophy of it's leadership.” (Abassi
and Hollman, 2000, p. 333)
employee’s turnover is the lack of recognition from the organization he belongs
to. Why? “Lack of personal and team recognition translates to the employee as a
lack of success. Regardless of the organizational level, employees want to feel
good about themselves and their work, have a sense of purpose, and to be
recognized when they do their jobs well. They want more than the standard pay
and benefits package that formed the heart of traditional retention plans.
Also, some employees appreciate the challenge by management to grow
professionally. They consider recognition as a form of reinforcement and
feedback for their accomplishments.” (Abassi and Holland, 2000, p. 333)
is the compensation scheme of an organization, particularly, if an organization
fails to offer good compensation packages for their employees. “Workers expect
tangible rewards for good work and they like to be paid or receive financial
rewards commensurate with their worth to the organization. For this reason, the
organization's objectives and philosophies about what it will pay workers, as
well as concerns about pay equity within the organization and in relation to
other organizations, must reinforce and reflect the organization's culture,
external environment, and business strategy. In addition, employers should
recognize that a person's earnings subliminally serve as an indicator of power
and prestige and are tied to feelings of self-worth. For many workers, earnings
are a barometer of their value to the organization. Earnings and pay incentives
can make workers feel that they have a vested interest in the organization's
collective success, heighten their sense of self-worth, and cement their
commitment and loyalty.” (Abassi and Holland, 2000, p. 333)
stay or leave the company may depend on the working conditions of an
organization, and also, it is important for employees to feel secured in their
jobs and to have a sense of belongingness. “While employee allegiance and
devotion are not automatic anymore, if there is a positive work environment
that is enriching and rewarding to employees, in which they have an affinity
for those around them, they are more likely to stay and to energetically
participate in the organization's activities.” (Abassi and Holland, 2000, p.
333)
company, what must organizations do to evade employee turnovers? Abassi and
“Today's boss must provide strong leadership in an environment where technology
is growing at a runaway pace, change is constant, and uncertainty is never
ending. They must achieve organizational profit and other goals with an
increasingly diverse workforce whose attitudes and values have changed greatly
from the previous generation. Managing today requires ingenuity and strategic
wisdom to a greater degree than at any time in our history. Managers must keep
in mind that employees are the major contributors to the efficient achievement
of the organization's success. They must hire and train the right people, adapt
their managerial style to today's worker, provide recognition and pay for superior
performance, and create a non-toxic and productive work environment. Those
managers who cannot or refuse to change face the prospect of excessive
departures that can imperil the business strategy and be ruinous to the
performance of their organization.” (p. 333)
preceding sections were particularly relevant because it gave an overview on
the topic of turnover. The main aim of this study is to determine the reasons
for turnover of the aircraft mechanics of the Saudi Arabian Airlines from a
technical position to a non-technical job, and the article gave some major
reasons for turnover. Even though the setting of the article is on the other
side of the globe apart from the research venue of this study, some
similarities may be traced during the course of this study.
Studies
is one that Dennis (1998) conducted. It was a study that investigated the
reasons why employees separate from their agencies, more specifically, the
reasons for dissatisfaction in some aspect of the job that leads to separation
from an organization. This study was conducted in relation to an event in 1996,
when 23, 745 correctional officers quit their jobs at fifty two adult
correctional agencies in
In the said study, the specific factors influencing job satisfaction and the
correlation between the management traits of prison administrators and the
level of job satisfaction and staff turnover were conducted.
full time, permanent employees assigned on 11 prisons operated by the Kentucky
Department of Corrections (DOC), where a total of 1,330 questionnaires were
completed (thus reflecting a fifty five percent return rate), restated a
long-held view of management theory: that those employees who feel more
empowered are more satisfied with their jobs, and thus, are more inclined to
stay with the organization. (Dennis, 1998, p. 96+) More specifically, the study
yielded the following results: “Most of the correlations follow logical
patterns of predictable relationships. Age is positively correlated with
tenure, salary, supervisory status and education. Education is highly
positively correlated with salary, age, supervisory status and shift worked.
The strongest positive correlation was between the variable of empowerment and
job satisfaction. Job satisfaction also was positively correlated with age,
tenure, salary and supervisory status. It was negatively correlated with stress
and shift work, indicating that the less stress a person was under, the more
satisfied the person was; people who worked the day shift also were more
satisfied than their night-shift counterparts. There was a slight, but still
significant, positive correlation between job satisfaction and education,
indicating that people with more education were slightly more satisfied. The
strongest negative correlation was between stress and empowerment, indicating
that the less stress an employee experiences, the more empowered they feel. The
only significant correlation of race with another variable was a negative
relationship with the variable of empowerment, indicating that nonwhites feel
slightly less empowered than whites. Gender was negatively correlated with both
supervisory status and shift, indicating fewer women are supervisors and more
women work the day shift. There was a correlation between gender and education,
indicating that male staff members tend to be slightly better educated than
female staff members. [On the other hand] a path analysis was performed to
identify significant causal relationships among the variables. The paths
depicting the direct impact of race, gender, education, salary and supervisory
status on job satisfaction were not significant. The paths depicting the direct
impact of gender, age, education and tenure on the intervening variable of
empowerment also were not significant. While race has no direct impact on job
satisfaction, it does have a significant inverse direct impact on empowerment,
with nonwhites feeling less empowered than whites. Age and tenure both have a
significant direct impact on job satisfaction, indicating that the longer a
person works in the prison, the more satisfied he is. This seems logical given
the assumption that employees who are not satisfied will probably leave the
organization earlier in their careers. The shift a person works also has a
direct impact on job satisfaction, supporting the contention that people who
work the day shift are somewhat more satisfied than
and whether a person is a supervisor both impact empowerment and, thus,
indirectly impact job satisfaction. However, by far the most significant
variable in the model is stress. Stress has a direct impact on both empowerment
and job satisfaction. The most significant relationship revealed by this
reduced form model is the direct impact of empowerment on job satisfaction.
This certainly is not a new and shocking revelation. It is the empirical
validation of what should be a "self-evident" truth. The more
empowered employees perceive themselves to be, the higher their level of job
satisfaction and the lower their level of perceived occupational stress. More
satisfied employees have a stronger sense of organizational commitment. The
level of commitment of organization members varies directly with the amount of
control they are able to exercise over their work environment. The greater the
amount of perceived control, the greater the level of organizational commitment
and, thus, the lower the level of alienation and job dissatisfaction. Higher
job satisfaction is directly associated with lower employee turnover. Empowered
employees will be more committed to the organization, resulting in longer
tenure.” (Dennis, 1998, p. 96+)
appeared to be relevant to this study, is one conducted by Zenger (1992). It
was a study that tried to provide an efficient explanation for commonly
observed performance-based compensation contracts that aggressively reward
extreme performance and largely disregards performance distinctions for
moderate performance levels. The study predicted a relationship between
performance and turnover that fluctuates by performance level, in response to
the above-mentioned “reward-the-extremes” contract. (p. 198)
and moderately low performers are likely to remain in firms offering these
kinds of contracts (“reward-the-extremes” contracts), while moderately high
performers and extremely low performers are likely to depart from a company
that offers such kind of contracts. (Zenger, 1992)
caution should be done when generalizing the results of the study, since the
compensation schemes of only two companies were investigated.
that of
and Mesch (1990), which studied the impact of flexible scheduling on employee
attendance and turnover. The study have the following hypotheses: There will be
a significant reduction in the absence rate in the post-intervention period, as
compared with the pre-intervention period, for the experimental group with
respect to the implementation of the flexible-scheduling program; There will be
a significant increase in the absence rate in the post-intervention period for
the experimental group with respect to the discontinuance of the
flexible-scheduling program; There will be a significant reduction in the
turnover rate in the post-intervention period, as compared with the
pre-intervention period, for the experimental group with respect to the implementation
of the flexible-scheduling program; There will be a significant increase in the
turnover rate in the post-intervention period for the experimental group with
respect to the discontinuance of the flexible-scheduling program. No such
differences are expected in the control group, which experienced no
intervention. Changes in the control group would seriously weaken any
demonstrated support for the hypotheses; There will be no difference in the
absence rate in the post-intervention period, as compared to the
pre-intervention period, for the control group with respect to the
implementation of the flexible-scheduling program; There will be no difference
in the absence rate in the post-intervention period for the control group with
respect to the discontinuance of the flexible-scheduling program; There will be
no difference in the turnover rate in the post-intervention period, as compared
with the pre-intervention period, for the experimental group with respect to
the implementation of the flexible-scheduling program; There will be no
difference in the turnover rate in the post-intervention period for the control
group with respect to the discontinuance of the flexible-scheduling program.
(Dalton and Mesch, 1990, p. 370+)
discussion: “The results the study yielded demonstrate large reductions in the
absence rate for experimental group receiving the flexible schedule
intervention. Employee attendance is some function of the motivation to attend
and the ability to attend. The "motivation to attend" portion of the
model may well capture the various elements hypothesized to affect the link
between flexible scheduling and absenteeism--autonomy, responsibility,
increased satisfaction in the workplace, and non-work activities, and
organizational commitment. In addition, there are obvious, practical effects
that may increase employees' ability to attend. There is no evidence that the
introduction of flexible scheduling had any effect whatsoever on subsequent
levels of employee turnover beyond what would have been expected as a function
of trend. It is possible, of course, that the motivational aspects are salient
but that other factors led to our inability to demonstrate a systematic
decrease in turnover. Strictly speaking, employee turnover did decrease in the
experimental division over the period (16.8 percent annual turnover in year
one; 9.9 percent annual turnover in the final year). This reduction, however,
is almost certainly not a function of the intervention, since the turnover rate
in the control group also greatly declined over the period (from 12.6 percent
to 5.2 percent). It is clear that some factor other than the naturally
occurring intervention was markedly affecting the rate of employee turnover
over the period. We suspect that this decline was brought about by general
economic conditions, more specifically, reduced alternative employment
opportunities.” (Dalton and Mesch, 1990, p, 370+)
that of McElroy, Morrow and Fenton (1995). The study have three hypotheses:
Absenteeism levels of employees who voluntarily leave an organization will tend
to be higher than that of those who remain with the organization; Job
performance of employees who voluntarily leave an organization will be
different than the job performance level of those who remain with the
organization; and, Absenteeism will explain a statistically significant mount
of variation in voluntary turnover beyond that explained by demographics, such
as age and tenure. (p. 91+)
following discussion:
compromises that are sometimes necessary in conducting turnover research. The
sample size of leavers was small, and occasionally reduced even further due to
missing data. Additional information needed to demonstrate comparability
between the stayers and the leavers was also unavailable (e.g., marital status,
number of dependents). Other individual difference factors besides performance
merit consideration (e.g., work ethic endorsement, commitment to the
organization) as they too may have a bearing on the absenteeism-turnover
relationship. Multiple measures of both absenteeism (e.g., frequency, severity)
and performance (e.g., objective performance data as well as subjective
supervisory ratings) should also be incorporated into subsequent
investigations. These limitations speak to the tentativeness of this study's
findings and the improvements that might be made in future research. Despite
these reservations, the results of this study provide some support, albeit
mixed, for a progression of withdrawal model. First, the results showing higher
use of sick leave over the three month period prior to termination for
voluntary leavers as compared to stayers, indicating that those who leave by
choice have higher rates of absenteeism. Finally, although the reason for the
higher use of sick leave remains unknown in this study (i.e., we have no
information on whether it was used for illness, job search, etc.), these
results, coupled with the performance findings, do lend support for the
progression of withdrawal thesis, at least among poorer performers in the
public sector who leave voluntarily. On the other hand, the inability of
absenteeism to add to the predictability of turnover beyond that accounted for
by such demographics as age and tenure implies a lack of support for the
progression of withdrawal model. Turnover in this organization appears to be
the result of a combination of factors. The performance appraisal ratings
probably constituted a "push" factor. That is, employees receiving
lower ratings were, in effect, encouraged to leave. However, the demographic
differences between the leavers and stayers indicate a "pull" factor.
Those who voluntarily left the organization tended to be younger (M = 34.43
years) than those who stayed (M = 46.39 years; t = 6.21, p[less than].001),
with lower levels (M = 5.65 years) of organizational tenure than the stayers (M
= 13.60 years; t = 5.92, p[less than].001). Being younger and with less tenure,
these employees may have perceived more opportunities outside the organization,
coupled with fewer side bets holding them to the organization. Older workers
with more tenure in the organization may feel that they not only face fewer
opportunities outside the organization but have too much at stake in terms of
pension, vacation, medical and other benefits if they were to leave. The
potential interaction of such environmental factors as performance feedback and
job opportunities and personal factors as age and tenure which is evident in
this study is a common problem in turnover research. The results of this study
must also be viewed in light of the nature of the turnover being experienced in
this organization. It is possible that the progression of withdrawal model is
only applicable to organizations experiencing voluntary turnover of poorer
performing employees. The results of this study, however, make it unlikely that
monitoring absenteeism would serve as a practical early warning of ensuing
voluntary turnover since the absenteeism is likely to be manifest only just
prior to the ensuing withdrawal. What is more likely, given the type of
employee choosing to leave this organization, is that the decision to leave is
made first. Whether the increased use of sick leave is due to job search
activities, illness, or whether it is an attempt to "get all that one is
owed by the organization" prior to leaving remains an unknown question,
but one worthy of future research.” (McElroy, Morrow and Fenton, 1995, p. 91+)
project is that of Devens (1992), who conducted the Employee Turnover and Job
Openings survey from late 1990 to mid-1991. This survey sought to determine
whether advanced data collection technologies and a specific legislative
mandate to produce data, which is related to national labour shortages, could
lead to a cost-effective statistical program. (p. 29+)
(1992) gave the following discussion:
that the collection of data on job openings and employee turnover remains a
difficult and labour-intensive undertaking. The response analysis survey found
that a substantial majority of respondents used personnel or payroll records as
the primary sources of information to complete the Employee Turnover and Job
Openings Survey. As a result, there were no major problems with the validity of
the data although technical issues of multiple reference periods, the treatment
of inter-establishment transfers, and the calculation of wages under
non-standard pay schemes would need to be addressed during the implementation
of a full-scale program. Although the primary objectives of the Employee
Turnover and Job Openings Survey were to assess the technical feasibility and
estimate the cost of conducting a full-scale program, it yielded statistical
results for analysis as well. The following overview of the findings pertain
strictly to the aggregation of the eight specific industries that were selected
for the survey and do not reflect estimates for the entire economy. In the
eight industries surveyed, there were numerous openings in the first rotation
(November 1990-January 1991) in professional and technical, service, and
production and related jobs. In the second rotation (February 1991-April 1991),
there was a statistically significant decrease in job openings among the
production and related jobs. This shift may reflect seasonal factors, irregular
events, or cyclical developments. The survey was conducted in the midst of a recession
that resulted in a sharp reduction in employment in several of the industries
included in the sample. These declines may have affected the number of
openings, particularly for production jobs, which tend to be cyclically
sensitive. A large number of job openings do not, in itself, signal a shortage
of labour. More important are the length of time such openings remain unfilled
and the number of openings relative to new hires (the fill rate). When these
criteria are applied, it becomes clear that the professional and technical
occupations and the managerial occupations most likely had a shortfall of
labour. For each of these two groups, more than half of the job openings had
been open for more than 4 weeks in both rotations. By contrast, little more than
one-tenth of the job openings for the service occupations were of long
duration. In addition, the professional and technical occupations and the
managerial occupations had relatively little new hiring and separations. The
fill rates were less than 1 for both groups, indicating that openings exceeded
hirings. The large number of job openings in the service occupations, on the
other hand, were also associated with high levels of separations and new
hiring. Service occupations made up about two-fifths of the separations and
nearly half of the hiring in both rotations.” (Devens, 1992, p. 29+)
basically about employee tenure and employee turnover. The researcher chose to
cite this studies not only because the cited studies somewhat have similar
objectives like this project / study have, but also because they yielded
results that may help in this project’s analyses and / or explanation of
in the process.
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