Incentive system of skill-oriented dispatched employees based double moral hazard

Yanli Yang, Xianyu Wang

School of business, Sichuan University, Chengdu, 610000, Sichuan, China

As market competition gets increasingly fierce, the elastic way of employment arouses great concern among more and more enterprises, which results in rapid development of labour dispatch. Labour dispatch is different from the traditional way of employment and it involves the three parties of the employer, the accepting entity and the dispatched employee with the striking feature of asymmetric information. From the perspective of the employer, this paper analyses the incentives of the three parties in labour dispatch while taking the employer as the first principal and the accepting entity as the second principal in consideration of the factors that the intermediary agent’s training will influence the quality of the employee. It verifies through models the sharing ratio paid by the accepting entity to the employer, the sharing ratio paid by the employer to the dispatched employee and the fixed wage paid by the accepting entity to the dispatched employee in expectation of offering concrete suggestions to the practice of enterprises.