Abstract
This research investigated the triangular employment relationship between organizations, temporary staffing agencies, and clerical temporary workers using the conceptual framework of the psychological contract. The rapid growth in triadic employment relationships is well documented; however, there is limited research into the interlocking psychological contracts between the three parties. This research advances our understanding of the mechanisms underlying triangular psychological contracts by drawing attention to the ways in which people’s beliefs concerning their own obligations toward others may be incommensurate with their expectations of other parties. Findings are based on semistructured interviews with 10 client organization representatives, 10 staffing agency consultants, and 20 female clerical temporaries working in Auckland, New Zealand. The interviews revealed that the three sets of participants held mutually incompatible expectations, which were shaped by their differing positions and power bases within the temporary labor market. Each group expected, or wanted, the other parties to behave toward them as if a relational psychological contract existed but perceived their obligations toward others in more transactional terms. In consequence, the expectations, goals, and actions of the three sets of participants often conflicted, creating a range of adverse outcomes, which were unintended by, and problematic for, each group within the triangular employment relationship.
Introduction
Psychological contract theory is one of the dominant approaches to understanding the ways in which employment relationships operate at the psychological level (McLean Parks et al., 1998; Schalk & Roe, 2007; Sherman & Morley, 2015). Rousseau’s (1995, 2001, 2018) interpretation of psychological contract theory provides a useful model for analyzing the employer/employee relationship. She suggests that the psychological contract involves “individual beliefs, shaped by the organisation, regarding terms of an exchange agreement between individuals and their organisations” (Rousseau, 1995, p. 9).
Rousseau (1995, 2001) introduced the distinction between “relational” and “transactional” psychological contracts. Relational contracts are usually long term, involve both economic and socioemotional elements, and are typically characterized by an obligation on the employer’s side to provide job security and career development in return for employee loyalty and good quality performance. In contrast, transactional contracts are often time limited and based around an economic exchange model in which both parties provide clearly delineated services to the other. The theoretical literature on psychological contracts suggests that relational contracts are more likely to be associated with stable employment, whereas transactional contracts are more likely within contingent employment contexts. This distinction is not clear-cut however, with a growing body of empirical research revealing considerable variability in the types of psychological contact that exist in both permanent and contingent employment relationships (De Cuyper et al. 2008; Farnese et al., 2018; Guest et al., 2010; Lemmon et al., 2016).
In the traditional employment context, the psychological contract is typically based on mutually compatible expectations between the employee and employer (Rousseau, 1995), with early conceptualizations emphasizing the importance of understanding the employment relationship from the interconnected perspectives of all parties involved. More recent research has focused primarily on the perspective of employees, often using survey methodology to examine the ways in which employee productivity and commitment are diminished when employers breach the psychological contracts of their staff (e.g., Bal et al., 2010; Dawson et al., 2014; Lapalme et al., 2011). In recent years, an increasing number of writers have criticized the focus on employees, arguing that psychological contracts need to be researched as reciprocal psychological relationships in which all parties have interlocking expectations of, and perceived obligations toward, each other (Conway & Briner, 2009; Cullinane & Dundon, 2006; Guest et al., 2010; Rodwell & Ellershaw, 2015; Tekleab & Taylor, 2003; Toms & Biggs, 2014). Despite this, there is still relatively little research exploring the ways in which employees breach the psychological contract expectations of their employers, although research by Guest and Conway (2002), Nadin and Williams (2011), and Tsui and Wang (2002) has explored employer perspectives.
Exploration of psychological contracts in more complex employment relationships is lacking. The focus of this research is on the three-way interactions between temporary clerical workers staffing agencies and employers. In triadic employment relationships, organizations obtain temporary staff using employment agencies as intermediaries (Bonet et al., 2013; Morf et al., 2014). Legally, agency workers are contingent employees of the agency rather than the client organization; however, the client organization directs the worker’s daily activities and supervises their work. Triadic employment arrangements create a complex and fluid employment context in which each party needs to rapidly create and maintain a psychological contract with the other two parties. In consequence, the potential for misaligned psychological contracts between the three parties is considerable (Alcover et al., 2017; Smith & Neuwirth, 2009).
Alcover et al. (2017) highlight the importance of understanding people’s generalized expectations concerning reciprocal rights and obligation within the workplace, arguing that these form the backdrop to specific contracts. Generalized expectancies are likely to be particularly important in temporary employment relationships where the shorter time frames increase the probability that all parties will draw upon generic templates concerning their rights and obligations as a means of organizing their relationship. Generalized expectancies are also likely to reflect power arrangements within employment relationships and reveal the ways in which the different parties’ perspectives are shaped by wider labor market conditions. Empirical research into triangular employment relationships suggests that the expectations and obligations that the different parties feel they have toward each other are often incompatible (Boyce et al., 2007; Morf et al., 2014; Stanworth & Druker, 2006; Svensson & Wolven, 2010; Toms & Biggs, 2014). Research by Connelly et al. (2011) and Svensson (2011) has further demonstrated the complexity of triangular employment relationships by showing that positive or negative perceptions formed in one employment relationship may spill over to influence workers’ attitudes and behaviors within subsequent employment.
This research examines the ways in which psychological contracts between the three different groups are shaped by the context of the temporary staffing industry. Despite the fact that the working relationship between employers, agencies, and temporary workers differs considerably from the traditional employment relationship between an employer and a permanent employee, most studies on temporary staffing involve only one or sometimes two of the three parties involved. This study draws upon data from interviews with client organization representatives, recruitment consultants, and female clerical temporary workers to explore three key issues. First, it examines the ways in which the psychological contracts of each group reflect their position within the agency labor market. Second, it investigates inconsistencies between the expectations that each party holds concerning the obligations of others toward them and their own obligations toward others. Last, it explores discrepancies within the interlocking psychological contracts of the three parties to discover whether mismatches between the three parties’ perceived expectations and obligations create problems within the triangular employment relationship. Data from all three groups enable viewpoints to be compared and contrasted so that mutuality and incommensurability between the different groups can be explored. The research explores participants’ expectations concerning their own behavior toward others as well as their expectations concerning the behavior of others toward them. These intersecting triadic expectations have been neglected in both theoretical writing and empirical research.
Method
This research was located in Auckland, New Zealand. Auckland is New Zealand’s largest city with a population of around 1.5 million people and a large commercial sector. Temporary employment agencies supply around 8% of the clerical and administrative labor force (Statistics New Zealand, 2017).
Participants
Ten senior recruitment consultants were recruited by cold calling agencies listed in the Auckland Yellow Pages. The nine female and one male consultants occupied senior positions at different agencies and were either branch managers of large temporary staffing agencies or the owners of small agencies. Average tenure within the industry was 9 years; average age was 36 years.
Ten representatives from organizations that regularly employ temporary staff were recruited by asking the participating agencies to identify client organizations using their services on a regular basis. The seven female and three male participants worked for different organizations in either human resource departments (n = 5), managerial positions (n = 2), customer services, recruitment, or accountancy (n = 1 for each). Organizations included a law firm, educational institutions, local government, and manufacturing and telecommunications companies. Five organizations employed between one and 5,000 staff, three employed between 300 and 650 staff, and two employed less than 140 staff. Mean age of the participants was 40 years.
Twenty women working as temporary clerical staff were interviewed. Participants were recruited through email flyers sent out by the employment agencies. Women’s ages ranged from early twenties to early sixties. Twelve women had high school or commercial office qualifications, eight had university degrees. Participants had worked as agency temporary workers for between 6 months and 12 years, with several working repeatedly for agencies in the interludes between permanent employments. The mean age was 41 years. The decision to only interview one occupational category of temporary worker was taken to enable group-level comparisons to be made without too much variability in participant characteristics. Although the occupational range of people seeking work through agencies has increased considerably in the last 20 years, female clerical staff remain the largest single group in the agency labor market (Cochrane & McKeown, 2015).
Interviews
Participants were individually interviewed. Client organization representatives and recruitment consultants were interviewed at their workplace; temporary workers were interviewed at home or in another nonwork location. Interviews averaged 40 min for client organization representatives and consultants and an hour for temporary workers. All interviews were taped and transcribed by the authors.
Interviews were semistructured, with the three groups being asked complementary sets of questions concerning their experiences of the triangular employment relationship. The interview topics covered with temporary workers included financial aspects and other benefits of temporary work, social aspects of temporary work, hours of work, the nature of assignments, problems encountered and strategies for dealing with problems, personal autonomy and flexibility, relationships with agency and employers, and psychological well-being and health.
Recruitment consultants were asked about the qualities required of temporary workers, current trends, financial and other benefits for temporary workers, social aspects of temporary work, the hours of work and nature of assignments, the value placed on temporary work, the autonomy and flexibility available to temporary workers, agency responsibilities, problems in the temporary staffing industry, aims and expectations, and their experiences of the triangular working relationship.
Questions for employers included how frequently they employed clerical temporary workers, the qualities required of temporary workers, the advantages and disadvantages, financial aspects, social aspects, hours of work and nature of temporary workers’ assignments, teamwork and social engagement, training and induction, autonomy and flexibility, perceived responsibilities toward temporary workers, problems, aims and expectations, and their own experiences of the triangular working relationship.
Analysis
The epistemological standpoint underpinning this research assumes that there are objectively identifiable power relationships and power imbalances between the three parties to the psychological contract. However, participants’ responses do not illustrate objective truths about the psychological contract, instead exemplifying their subjective understanding of their relationship with the other parties in the triadic employment relationship. These perceptions may have consequences that are objective if they influence participants’ behavior toward other parties.
A six-stage theoretical thematic analysis of the transcripts was undertaken (Braun and Clarke, 2006, 2013; Clarke & Braun, 2013). According to Braun and Clarke, a theoretical thematic analysis is shaped by the researcher’s interest in a particular research question and the interview data are then analyzed to see what they reveal about that issue. Within this research, analysis focused on understanding each set of participants’ psychological contract expectations concerning both the behavior of the two other groups toward them and their own perceived obligations toward the two parties. The six analytic stages that Braun and Clarke (2013) identify are initial familiarization with the data, initial coding of each transcript, generating initial themes, reviewing these themes, defining and naming superordinate themes, and finally writing up the data.|
Within this study, each transcript was initially studied individually to gain familiarity with the data and the initial codes were created for each transcript. The key themes describing each participant’s expectations of other groups and perceived obligations toward them were then identified. The themes for participants in each group were then reviewed and compared, and a set of key themes relevant to that group was generated. The emergent themes for each group were defined and named, then compared and contrasted with the emergent themes for the other two groups. Finally, the triadic psychological contract between the three groups was interpreted in relation to each group’s structural position and power bases within the agency labor market.
Findings
The findings suggest that the three sets of participants held mutually incompatible perceptions concerning their own and others’ obligations. All parties tended to want the other two parties to behave as though a relational psychological contract existed but to see their own obligations in more transactional terms. In consequence, each set of participants tended to find some attitudes and behaviors of the other two groups problematic. Key findings are summarized in Table 1 and discussed in more detail in the rest of this section.
Expectations and Obligations as Perceived by Different Parties.
Client Representatives
Expectations of Other Parties
Organizations used temporary staff for a wide variety of reasons, ranging from covering short-term staffing needs to the regular use of “permatemps” as a long-term strategy for dealing with fluctuating demand, cutting costs, and limiting organizational responsibility. Despite this, expectations concerning the ideal staffing agency and temporary employee behaviors were consistent across the group.
None of the organizations had “sole supplier” agreements with agencies; however, all had “preferred supplier” lists consisting of several agencies, which they used repeatedly. In return for this privilege, agencies were expected to understand the organization’s requirements and to supply appropriate and high-caliber staff. The human resources advisor for a large government department explained, We have a couple of preferred suppliers and what I’m wanting to do is have just a small selection of agencies that we use rather than anyone and everyone because then we can’t establish a relationship with them. They need to learn our business and our needs. (Phillippa)
The long-term relationship with an agency implicit in the preferred supplier status was linked by eight participants to the expectation that they would be able to rehire specific staff whenever required. The general manager of a medium-sized manufacturing company explained, We had a lady who was excellent the first time around and when we needed her back for the next part of the project, she’d already been assigned to another job and that job is a two year job . . . so we had to train another temp who wasn’t as good. (Caroline)
These examples, and a range of other comments, suggest that client organizations expected their preferred suppliers to act as though a relational psychological contract existed. In return for the implied security of preferred supplier status, employment agencies were required to go beyond simply supplying temporary staff, putting the organization’s needs above those of other clients.
Participants’ descriptions of the performance and commitment they wanted from temporary staff suggest that they also expected temporary staff to behave as though a long-term, relational contract with their organization existed. Six participants maintained that temporary staff should show the same commitment to their organization as permanent staff. A senior manager at a large government organization also suggested that uncommitted temporary staff reflected badly on their recruitment agency: Temps should show the same commitment to our organisation as our own permanent staff—the agents understand that—if temps don’t have the same standards and commitment as our permanent staff we send them back. A good temp understands their function—they know they have to give us one hundred percent commitment while they are here—but then they move on. (Dave)
These comments highlight the high degree of commitment that client organization representatives expected from temporary staff, while illustrating the highly contingent nature of the organization’s commitment to the worker.
Obligations Toward Other Parties
Client organization representatives saw their own obligations to both agencies and temporary workers in transactional terms. Although all used “preferred supplier” arrangements with agencies and maintained that long-term connections facilitated smooth working relationships, several were willing to play agencies off against each other to negotiate lower rates. According to six participants, fee negotiation was a common corollary of preferred supplier status with agencies expected to offer substantial discounts in return for repeat business. This often affected negatively temporary workers, with several consultants commenting that they were unable to offer their temporary workers wage increases because client organizations were bargaining increasingly aggressively over rates.
Client organizations frequently tried to appropriate good temporary workers for permanent positions within their own organizations. Nine participants had offered temporary workers permanent employment. Although this necessitated paying agencies a conversion fee, this tactic was still perceived as an effective way of assessing staff before employing them permanently. According to participants, the majority of temporary staff accepted these offers, which often gave them slightly higher pay rates and more security than temporary work. Although this strategy had benefits for organizations, and possibly for temporary staff, it was resented by agencies who perceived it both as “poaching” of their best workers and as potentially reducing future demand for their services.
All participants described their organizations’ commitment to temporary workers in transactional terms, often viewing them quite literally as a “human resource” that facilitated organizational flexibility and required little responsibility beyond their legal obligations. The human resources manager from a large telecommunications company summed up the views of many employer representatives when she stated that, We hire them just solely for certain roles and then have no further commitment to that person after that project is finished. (Jenny)
Several employer representatives contrasted their organization’s relational commitment to permanent staff with their obligations to temporary staff. The manager of one of the largest organizations sampled explained, As a company we are very aware of our social responsibilities. There is only so much you can put on a person’s role before you are going to make them sick. So it’s a lot easier for us to bring in a temp to help out. We can give them the really boring tasks because they are only here for a short time. (Caroline)
Although this comment shows concern for the welfare of permanent staff, it also suggests limited concern for the welfare of temporary staff who may repeatedly be given the most tedious tasks across different organizations.
The primarily transactional obligations that participants perceived their organization as having toward temporary employees remained even when agency staff worked on long-term contracts lasting months or years within the same company, although three participants did describe providing more varied work to highly valued, longer term temporaries.
In summary, the interviews with client organization representatives suggest that they expected agency staff and temporary workers to behave as though a relational psychological contract existed but viewed their own obligations in more transactional terms.
Employment agency representatives
Temporary staffing agencies function as intermediaries between organizations and workers (Elcioglu, 2010; Enright, 2013; Mitlacher, 2007). The interviews with employment agency representatives revealed the challenges of managing the competing demands of different client organizations and temporary staff.
Expectations of Other Parties
In contrast to client organization representatives, who tended to describe their obligations to agencies in transactional terms, every recruitment consultant emphasized the importance of shaping relational psychological contracts with client organizations, depicting this as a key mechanism for maintaining demand for their services and surviving in a competitive industry. The manager of a small employment agency described the Auckland temporary staffing industry by saying, It’s a highly competitive market, and it’s pretty cut-throat too, but if you’re good, you’ll get the work. If you’ve got a really good relationship with the clients, you’ll get the work. (Karen)
Although the quality of the personal relationship between agency representative and client organization was viewed as a crucial mechanism for generating repeat business by all participants in this group, the quality of the temporary worker and the agency’s capacity to supply suitable workers promptly were also seen as key mechanisms for maintaining clients. Several recruitment agents highlighted the importance of sending their most competent workers to those organizations who used them regularly. The owner of another small agency explained, We always over-deliver a temp to a job . . . I’d rather always over-deliver the skills to what the requirement of the job is . . . their confidence is high, and they’re very capable and therefore a client goes “oh you’re fantastic, we really like you in this job.” (Eve)
Although this strategy increased the standing of the agency with client organizations, it also increased the probability that client organizations would offer the agency’s best workers permanent jobs.
To supply good staff, agencies needed to maintain a reliable pool of high-caliber workers. All recruitment agency staff highlighted the importance of developing relational psychological contracts with their workers, describing this as a key mechanism for maintaining good-quality temporary staff. The manager of a small agency explained, Personal relationships are the key; a good personal relationship will retain someone much longer. (Eve)
“Sole agency” employment agreements where “exclusive” temporary workers were registered with one agency only were explicitly linked to relational psychological contracts by three consultants. The manager of a large multinational employment agency described the value of this arrangement to agencies: We want to keep good temps working for us. We say to them “we want you to come on board as an exclusive temp and we can look after you better if we know you’re committed to us.” A lot of temps want to multi—list—they’re the ones I won’t guarantee work for because they haven’t shown us any loyalty. (Karen)
Exclusive temporary workers have more value for agencies as they obtain greater control; however, exclusivity increases an agency’s obligation to provide continuous employment and temporary workers’ risks of unemployment if the agency fails to do so.
Recruitment consultants, like client organization representatives, emphasized the link between loyalty to the agency and service to the client. However, consultants also argued that temporaries needed to avoid becoming too committed to clients. The manager of a large agency highlighted this distinction when she observed, We want our temps to perform well—but they need to remember they work for us—not the client. It can cause problems if candidates identify too much with the clients. We do get situations where people only want to work for particular organisations and we try and discourage it. (Kathy)
The interviews with recruitment consultants suggest that they wanted both their client organizations and their temporary staff to develop relational commitments with the agency, although not with each other, and that they saw relational psychological contracts as a key mechanism for creating stability in both client demand and worker supply. In contrast to client organization representatives, who seemed not to question the legitimacy of their expectations concerning other parties’ behavior, recruitment consultants were strongly aware of the need to try and shape the expectations and behaviors of other groups toward the agency.
Obligations Toward Other Parties
The tensions inherent in recruitment agencies’ position as labor market intermediaries could endanger their carefully cultivated illusion of relational psychological contracts, potentially exposing the transactional way they perceived their own obligations to their client organizations and temporary staff. Consultants tried to smooth over this problem using various strategies.
The tactics that consultants used to protect their investment in workers while ensuring that key clients still felt they were being given preferential access to elite temporaries illustrate this. Several consultants described deliberately moving good temporaries between clients to prevent relational psychological contracts developing between clients and workers. Such acts were presented to organizations as regrettable necessities rather than deliberate choices. The manager of a medium-sized local agency explained, It can be difficult explaining to regular clients that they can’t have the temp they want. We have to be quite diplomatic . . . we explain that good temps are always in demand so clients can’t just get someone back whenever. (Trish)
Consultants also needed to manage their relationship with their temporary workers. All consultants discussed the difficulties of balancing client demands with the desires of their temporary staff. Consultants’ descriptions of these issues suggest that they tended to perceive their obligations toward their labor force in an essentially transactional manner while aiming to keep the impression of a relational psychological contract intact.
The intractable issue of pay rates illustrates the difficulties agencies experienced trying to maintain relational psychological contracts with two parties with incompatible agendas. The downward pressure on pay rates created by clients’ assertive bargaining made it difficult for consultants to advocate on behalf of their work force. All consultants described this as a growing problem, with several saying they felt unable to approach clients for either general rate increases or increases for specific workers. The branch manager of a large global employment agency observed that There’s significant pressure on us, from one side, our clients keeping our charge rates low, and yet from the candidate side people not wanting to work for minimum wage . . . it creates a very difficult situation. We have to explain to our candidates that we can’t negotiate on their behalf. (Melanie)
Comparable issues arose over work quality. To attract temporary workers, agencies extolled the variety of work available and the opportunities for temporary staff to learn new skills and enhance their employability through agency work. In practice, none of the consultants perceived their agencies as having responsibility for providing either diverse work opportunities or specialized training for temporary staff. Skills learnt during placements would be added onto a worker’s resume, enhancing their future employability. However, requests for specific placements were firmly discouraged, with more than half the respondents highlighting the importance of making temporary staff realize they had to accept whatever work was offered. The manager of a large agency explained, Basically, people have to accept whatever assignments they get given. If the work’s boring or the boss is difficult we encourage people to remember that it’s only for a short time. A good temp has the skills to be able to handle that stress. (Dorothy)
In conclusion, the interviews with recruitment consultants revealed that they all tried to build relational psychological contracts with their client organizations and their labor force, conceptualizing this as a strategy for maintaining both client demand for their services and a pool of high caliber workers. They construed their own obligations more transactionally, trying, albeit discreetly, to discourage clients from demanding special privileges based on a relational contract and viewing the wants of their workers as subservient to the requirements of clients.
Temporary Workers
Expectations of Other Parties
In contrast to the client organization representatives, all of whom had clear expectations concerning the behavior of the other two groups, and the recruitment consultants, who tried to influence the expectations and behavior of the other parties, none of the temporary workers expected to achieve a relational psychological contract with client organizations or recruitment consultants. Despite this, all temporary workers described their ideal psychological contract as one with closer personal relationships with people in the client organizations and the recruitment agency.
All temporary workers described their marginal positions within client organizations as the worst aspect of their work, with 11 participants describing the lack of personal connection within the workplace as a bigger stressor than the financial instability of contingent labor. In contrast to other research, which has found the impact of social isolation is greater for women who would prefer permanent employment (Gallagher & McLean-Parks, 2001; Subramony, 2014), the six respondents who engaged in temporary work through personal choice also described social isolation as the key drawback of temporary work.
Social isolation occurred through company policies that deliberately excluded temporary workers from social events, management decisions that placed them in physically or psychologically isolated positions, and through the actions of permanent staff. Exclusion from social events with a clear symbolic function, such as Christmas parties, or other celebrations, was described by most temporary workers as occasions where their marginal status within the client organization became particularly apparent. Six women described assignments where they were physically isolated during their working day. The resulting loneliness was clearly captured by a participant describing her current work situation: Within this company I work away from everyone. Nobody really cares whether I’m here or not. Yesterday there was a celebration in Marketing and I could hear them all but I didn’t know what it was about. Then there was some other celebration happening and I just felt so left out. (Joanne)
Although all temporary workers had faced isolation, most had also experienced jobs where they fitted easily into the organization and felt accepted by permanent staff. Participants valued these experiences but several also described the acute sense of loss they felt when leaving these situations. A participant who had recently spent a year within an organization covering maternity leave explained, I really enjoyed working there and I thought I might get a permanent position—but then (x) came back and I had to go. At the end of the day you’re still just the temp. (Anne)
These comments highlight the tenuous nature of relational bonds within temporary employment and the limited power that temporary workers have to change the temporal limits inherent in relationships. Similar findings were reported by Galais and Moser (2009) and Bosmans et al. (2017), both of whom suggested that developing relational psychological contracts with the client organization could be a mixed blessing for temporary workers.
In contrast to recruitment consultants, all of whom discussed the importance of developing personal relationships with workers, most temporary workers described their relationship with consultants as highly transactional, stating they had little communication with their agencies once on an assignment. The comment below typifies the descriptions given by participants: I didn’t feel the agents were my employers. It felt like I was out there on my own. They ring you at first to check its going ok, then ring you three months down the track. I think they should try to make it more of a team environment, so you feel you belong somewhere. (Anne)
Several participants were cynical of consultants’ attempts to befriend them, astutely identifying the economic motives and divided loyalties underpinning consultants’ actions.
A participant who felt she had developed a genuine relationship with a consultant described the sense of betrayal she felt when the consultant sided with an employer against her: I knew her for quite a long time and thought I’d developed quite a good relationship with her. But at the end of the day she took the client’s side. I’ve heard of other temps experiencing the same thing, it’s not just me. Their top priority is always the client. (Andrea)
Overall, participants’ comments suggest that although most no longer expected relational psychological contracts, most would have preferred people within both the client organizations and their employment agencies to act toward them in a more relational manner. This rarely occurred and most participants tried to rebalance their psychological contract with client organizations and agencies by developing an increasingly transactional perspective on their own obligations toward them.
Obligations Toward Other Parties
All participants highlighted the importance of working hard and getting positive evaluations from client organizations, with eight suggesting that organizations expected more from temporary workers because the costs of employing them were more salient than the costs of permanent staff. Several participants commented that they felt intimidated into complying with the high expectations of client organizations and consultants because of financial insecurity. As one participant observed, If you don’t have money you take what you can get. You never turn down an assignment. You don’t ring in sick, you don’t walk out however bad it is—because then you never get another job. (Jane)
Remarks such as this suggest that although the performance obligations that temporary workers perceived themselves as having were congruent with the expectations of the other two groups, their level of satisfaction with the relationship was often limited, and their actions and attitudes were strongly influenced by their relatively weak power base within the triadic employment relationship.
In contrast to the hopes of the recruitment consultants, most temporary workers interpreted their relationship with recruitment consultants transactionally, with three participants comparing the relationship with that between a car salesman and customer: You’re not going to be best buddies with your car salesman, you know they’re only nice to you because they are going to make money. That’s essentially the kind of relationship you have with your consultant. It’s a false niceness. (Jane)
In summary, all temporary workers identified the lack of meaningful social connection as one of the primary disadvantages of temporary work, with the majority of participants describing social alienation as a greater stressor than financial insecurity or tedious work. The ubiquity of this problem suggests that a sense of belonging is one of the key “latent” benefits of work (Jahoda, 1982), and that, for many temporary workers, the desire for a relational psychological contract with others remained strong. The temporary workers in this study had few practical options for changing their situation, beyond seeking permanent employment. Their only other recourse was to develop a more transactional approach to their work. Most participants described themselves as learning to view their obligations toward agencies and organizations in increasingly transactional terms. Unfortunately, these strategies sometimes meant that the relational expectations that the other two parties held concerning the behavior of temporary workers were unfulfilled.
Discussion
This research examined the triangular psychological contract between client organizations, temporary employment agencies, and temporary clerical workers, revealing the ways in which their perspectives and behaviors were shaped by their positions within the triangular working relationship. Three key issues emerging from the research seem particularly important to understanding the dynamics of the psychological contract within triangular employment relationships: first, the ways in which their relative power or powerlessness shape each party’s expectations of others and perceived obligations toward them; second, the role of generalized expectancies in shaping the psychological contracts between parties; lastly, differences between the three groups’ expectations of others and perceived obligations toward them.
Cullinane and Dundon (2006) argue that psychological contract research has neglected structurally based inequalities and conflicts of interest within the workplace. This problem has been recognized by some researchers who have studied the ways in which the increasing precarity of contemporary labor markets is altering psychological contracts (Dawson et al., 2014; Guest et al., 2010; Lemmon et al., 2016). Theorists of power have long argued that the exercise of power between different social groups involves a shifting “dialectic of control” in which the various parties draw upon the different structural resources available to them to achieve their goals. This view of power interprets it as a relative rather than an absolute phenomenon and implies that underpowered groups still retain the ability to exercise some degree of countercontrol. Within this research, the psychological contract expectations and obligations of the different parties were clearly influenced by their power within the agency labor market. The client organizations, recruitment agencies, and temporary workers had different levels of power, diverse power bases, and dissimilar goals, all of which shaped the ways in which they perceived the obligations of others toward them and their own obligations toward others.
Employer representatives had the greatest levels of structural power within the relationship as the employment agencies and temporary workers depended on them for work within an employment context where there was considerable competition between agencies, and the temporary workers were relatively low skilled. Consequently, employer representatives voiced their expectations concerning the behavior of the other two groups more confidently than agencies or temporary workers. Their analyses of their own obligations were similarly assertive, with all participants expressing highly transactional views on their obligations to agencies and temporary workers. The power base of recruitment agencies was more circumscribed. In consequence, they were less direct in their demands, seeking instead to shape the behaviors and perceived obligations of the other two groups toward a relational psychological contract while also protecting their own interests by covertly adopting more transactional approach to their own obligations. The temporary workers were the least powerful group within the triangular employment relationship, having skills that were replaceable relatively easily, and comparatively little bargaining power with either their agencies or client organizations. Although most temporary workers would have preferred more relational psychological contracts with recruitment consultants and client organizations, most recognized the difficulty of altering the essentially transactional underpinnings of these relationships. In consequence they tended to develop an increasingly transactional view of their own obligations toward the other two parties.
The power relationships observed within this study are unlikely to hold in all triangular employment relationships. Where the power relationship between different protagonists is altered, the content of the psychological contracts between them may also differ. Agency workers are found in an increasingly wide variety of occupations ranging from low-skilled, easily replaceable blue-collar, and clerical staff, to highly skilled and well-paid professionals in areas such as medicine and information technology (De Cuyper et al., 2008; Koene et al., 2014; Kroon & Freese, 2013). Where the skills of agency staff are higher, their power base will increase and their ability to negotiate different psychological contract terms may be enhanced. Highly trained temporary workers such as medical staff may have greater ability to negotiate their terms and conditions with recruitment consultants and client organizations and an increased likelihood of developing relational psychological contracts with colleagues through their shared professional identity. Power relationships and psychological contracts within triangular employment relationships are clearly mutable. Nevertheless, the relative power of the different players remains an important and underresearched aspect of psychological contracts within triangular employment relationships.
Psychological contract research has focused primarily on specific, individual-level dyadic relationships. This research adopted a different approach, focusing instead on participants’ generalized beliefs concerning their obligations toward others and others’ obligations toward them. There will, obviously, be situations where generalized expectations and specific psychological contract relationships diverge. However, generalized expectancies form a crucial backdrop against which more idiosyncratic psychological contract relationships may develop. All participants in this study talked easily about their own general expectancies concerning their relationship with other groups, suggesting that a framework of generalized expectancies helped them negotiate their relationships with other parties in their work environment. The substantial similarity in the views expressed within each group also indicates that participants in each group had shared mental models concerning their own and others’ behavior. Sherman and Morley (2015) highlight the role of both idiosyncratic, individual factors and shared social contexts in the development of psychological contract schemata. The findings of this research suggest that the position of each set of participants within the triangular employment relationship contributed to the development of generalized psychological contract expectations, which were relatively homogeneous for members of each group but which differed between groups.
Limitations and Future Research
The data did not allow examination of how participant demographics (age, skill set, experience, family commitments, etc.) related to perceptions of psychological contracts. Temporary workers with desirable, specialized skills and those who are not dependent on insecure work for income are likely to have more power in the triadic relationship. The current study was focused on clerical temporary workers; although this is the largest group of temporary workers, there would be value in examining triadic psychological contracts among other temporary labor forces and in a range of business sizes and sectors. We were unable to match triads of temporary workers, agencies, and employers all connected through the employment relationship, and this would be a worthwhile focus of further study.
Implications for Practice
This research revealed that participants’ opinions concerning their own obligations were often at variance with their views on others’ obligations toward them. This was most obvious in interviews with client organization representatives, where several participants expressed the view that temporary staff should show the same levels of commitment as permanent staff while also explicitly commenting that their own commitment to temporary staff differed from their commitment to permanent staff. Similar, though less conspicuous, inconsistencies were apparent in the interviews with recruitment consultants and temporary workers. One consequence of these inconsistencies was that all parties tended to feel dissatisfied with some aspects of the other parties’ behavior.
Expectations of genuinely relational psychological contracts were unlikely to be met, as each party reported promoting relational ties while offering means-end–focused transactional relationships. Although temporary workers were the most vulnerable to this dynamic, it appeared detrimental to all parties. Agency representatives reported trying to foster positive relationships with temporary staff while limiting their opportunities to turn temporary into permanent work and recognizing that obligations to clients outweighed obligations to support temporary workers. Employers reported underemploying temporary staff, creating the risk of boredom, dissatisfaction, and missed opportunities to make the best of skilled workers. Dissatisfaction may lead temporary workers to seek permanent positions if available, leading to skills shortages that affect the flexibility of agencies and employers alike.
In conclusion, the findings suggest that all parties sought to utilize the flexibility of the agency-mediated temporary labor market while minimizing the drawbacks. To achieve this, all parties used the resources linked to their positions within the triangular employment relationship to try and shape the behaviors and expectations of the other participants. This created a shifting network of interdependencies in which outcomes for any one group were constrained by the activities of the other two parties. The actions taken by each group to improve their own situation tended to aggravate the problems experienced by the other groups. This curbed the maneuverability of each group, creating psychological contract relationships that were frequently problematic for all concerned.
Footnotes
Declaration of Conflicting Interests
The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author(s) received no financial support for the research, authorship, and/or publication of this article.