| Summary: | The hotel industry is affected by environmental changes such as changes in law and regulations.In Malaysia, the hotel industry is afflicted by the increasing labour cost due to the implementation of a national minimum wage policy that started in May 2012.The policy implementation increases the need to practise functional flexibility.Functional flexibility refers to assigning an employee with a variety of jobs.Despite being one of the solutions to overcome the increasing labour cost, studies on functional flexibility practices in hotels in
Malaysia is scarce.The objective of this study is to identify the challenge of practising
functional flexibility in four-star hotels in Malaysia.For this purpose, twelve hotel managers
from hotels that are located in Penang and Langkawi Island were interviewed.Hotels
practise functional flexibility and face challenges especially from the labour union. Besides resistance from the labour union, other challenges are employees’ attitude and readiness to cope with handling a variety of jobs. This study contributes to human resource management
literature by giving an insight to functional flexibility practices’ challenges in Malaysian
hotel industry.The insight may serve as guide for hotel managers to handle the challenges and avoid legislation issues
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