The impact of flexi-time uptake on organizational outcomes and the moderating role of formal and informal institutions across 22 countries

Abstract

Viewing the acceptance of flexi-time as a social norm, and drawing on the notion of flexibility stigma, we theorize and test the effect of institutional context on the uptake of flexi-time and its impact on organizational outcomes. Specifically, we assess the explanatory power of formal institutional arrangements via the prevailing legislative framework governing flexi-time, as well as the impact of the informal institutional context via prevailing norms arising from the extent of cultural tightness or looseness. We then test our ideas using data from 22 countries. We found curvilinear relationships between flexi-time uptake, absenteeism, and employee turnover. These relationships were moderated by country-level formal and informal institutions. Thus, in culturally tight countries, and in those with no labour legislation related to flexi-time, the relationship between flexi-time uptake and organizational outcomes was curvilinear (i.e. an inverted U-shape) whereby when flexi-time uptake was 0% or >50%, absenteeism and turnover were at their lowest. Conversely, in culturally loose countries, and in those with labour legislation related to flexi-time, the relationship between flexi-time uptake and organizational outcomes was linear (i.e. the higher the flexi-time, the lower the absenteeism and turnover). Our findings underscore the importance of organizations taking account of the cultural and legislative aspects of their respective operating contexts when seeking to implement flexi-time arrangements. A misalignment between formal and informal institutions and flexi-time may reduce its uptake and have deleterious effects on absenteeism and turnover.