This article investigates labour flexibility in the Australian hotel industry. It identifies the different forms of labour used and attempts to provide a theoretical framework that accounts for changes in the pattern of hotel labour utilisation. In the hotel context, decisions concerning the allocation of tasks and labour are made at departmental level through a process of departmentalization where different forms of labour are utilized. The aim is to restructure the supply, effort, timing and intensity of work on a 'just in time' basis. The article suggests that the reorganization of hotel labour markets cannot be explained by a straightforward core-periphery model, rather, the flexibilisation of hotel labour reflects attempts to restructure working time, payment systems and labour costs in the context of broader cost minimization strategies. The implications of the findings at the level of public policy are discussed.