1.25.17

Scheduling protection laws for retail workers: A nice-sounding idea that can be a nightmare for employers

EDITOR’S NOTE: The following is adapted from a guest post by Bob that was originally published on January 4, 2017, in RetailDIVE.

Many cities are considering or enacting so-called “scheduling protection laws,” which are intended to provide stability and predictability for retail workers. Certainly one can empathize with a single parent of young children who is unexpectedly told that she has to report for an eight-hour shift – in two hours. It’s likely that the next two hours will be spent in a scramble to find a family member, a friend, a neighbor, or a warm body who can sit with and feed the kids. And if the parent says no to working on such short notice, she risks losing her job.

San Francisco and Seattle have enacted scheduling protection laws.The San Francisco ordinance applies to retailers with 20 or more San Francisco employees and that have at least 40 establishments worldwide. The Seattle ordinance applies to fast food and retail establishments with 500 or more employees, and to full-service restaurants that have 500 or more employees and at least 40 establishments.

Although the retail industry opposed these laws, at least the San Francisco and Seattle ordinances are limited to relatively large employers who might have other resources if an employee can’t drop everything and come in when his co-worker unexpectedly calls in sick.

But New York City is considering a package of bills that could be truly problematic for retail employers.

For starters, unlike the San Francisco and Seattle ordinances, New York City’s proposal covers retail businesses with five or more employees, including full-time, part-time, and temporary employees. Averages are based on the number of weekly employees who worked in the preceding year. That means smaller retailers who regularly operate with fewer than five employees, but who ramp up employment temporarily during the holiday season, will have to determine whether these seasonal additions raise their average to five or above. Chain retailers must count employees at all locations.

Is it a 'requirement' when a supervisor tells the employee that it would be 'really helpful' if she came to work? We don't know.

The proposal also bans retailers from using on-call scheduling and restricts them from modifying employee schedules with less than 72 hours’ notice. Although the practice of on-call scheduling has received much scrutiny recently, its elimination is likely to have minimal impact on retailers: The same analytic and scheduling software tools used in on-call scheduling will be used to project scheduling needs. To the extent that projections are less precise, retailers are expected to err on the side of running leaner shifts.

The more problematic issue is the proposed 72-hour notice rule, which would prevent retailers from cancelling scheduled hours, or requiring employees to work, on less than 72 hours’ notice. As proposed, there are exceptions allowing employees (1) to mutually agree to swap shifts, or (2) to provide written consent to working with less than 72 hours’ notice. But because employees will remain free to call in absent with less than 72 hours’ notice, the notice rule is likely to cause significant difficulties for retail employers.

Complicating matters even more, there is no guidance within the proposal defining when a “request” becomes a “requirement.” For example, is it a “requirement” when a supervisor tells the employee that it would be “really helpful” if she came to work? We don’t know. Because the minimum penalty is $500 per violation, retail employers are likely to leave the shift unfilled unless they can get the employee’s written consent to work on short notice.

The NYC proposal also requires retailers to give employees at least 20 working hours during any 14-day period, with an offset for any hours the employee elects to take as paid or unpaid leave during the period. This requirement will ultimately benefit some retail employees at the expense of others: Part-time or flex workers who commit to working a certain number of hours on a quarterly or other basis will be eliminated. Retailers are likely to carry fewer employees on their payrolls, which will result in even less flexibility in covering unexpected absences.

The proposal is unclear as to what constitutes “leave” for offsetting the 20-hour requirement. Is an unexpected absence the same as an unpaid leave? Usually, employment laws treat absences and leaves as distinct concepts. In this context, clarity is needed because retailers will undoubtedly be faced with call-offs that will put workers in danger of missing the 20-hour requirement.

Under the proposals being considered, retailers who offer in-store food or beverage service will have to evaluate whether those services are 'fast-food establishments.' If they are, then there may be different requirements in a single store for retail and fast food employees.

Retailers will additionally be required to post physical (yes, “paper”) copies of work schedules and to provide previous and current schedules to employees on request. There is a $300 penalty for failing to do so. If enacted, this provision will require many retailers who have long since moved to entirely electronic scheduling to revive the antiquated practice of creating and posting a physical schedule.

These are New York City’s retail-specific proposals, but they are not the only proposals that may affect retailers. The City is also considering proposals about scheduling and work requirements for fast-food employees. The fast-food proposals are not the same as the requirements for retail employees, but retailers who offer in-store food or beverage service will have to evaluate whether those services are “fast-food establishments.” If they are, then retailers may have to operate under different requirements in a single store for their retail and fast-food employees.

New York City is also considering laws that would apply to all types of employers in the city, including employee rights to flexible work arrangements, and temporary, emergency adjustments to work schedules. If enacted, these laws will create new compliance requirements that retailers will have to consider and implement alongside the retail-specific proposals.

Scheduling protection laws come at a time when the retail industry is in a state of upheaval. Gains are overwhelmingly occurring online, and in-store traffic has rapidly declined. Many brick-and-mortar retailers are already investing to integrate their customers’ physical and online shopping activity, and as the in-store experience evolves, merchants will continue to evaluate in-store staffing needs. The decreased scheduling flexibility, coupled with the increased compliance burdens and legal risks created by proposals such as the ones being considered by New York City, may compel these changes even sooner.

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