Reforms to “just-in-time” scheduling practices now before Congress

Legislative reforms to “just-in-time” workplace scheduling practices in the U.S. retail and other services industries are back before Congress. The Schedules That Work Act proposes a set of reforms that would give workers in these industries more predictable and stable schedules, targeting in particular the growth in just-in-time scheduling software that links an employee’s hours to the level of customer demand.

Just-in-time scheduling software is designed to manage labor costs, basing the number of employees working on the ebb and flow of customers. At first glance, determining the “optimal” number of staff that should be present at any given time behind a retail counter or in a restaurant makes plenty of business sense, yet some research shows that these scheduling practices may negatively affect employees and employers alike.

First the employees. These scheduling practices wreak havoc on workers, who are typically given their schedule only days, or even mere hours, ahead of time. Some stores give their employees “on-call” shifts, and are only brought in to work if things are busy enough. During slow times, employees can be sent home early without pay. The stress from scheduling fluctuations take a major toll on workers’ mental health, as they are not only uncertain about whether their hours will be sufficient to make ends meet but also unable to get a second job, pursue an education necessary for upward mobility, or even go to the doctor. These schedules also force working families to constantly rearrange last-minute childcare among family and friends and lose pay if they are unable to do so.

Such employee instability may be bad for business, too. Research by the University of Chicago’s Susan Lambert finds that unpredictable schedules can harm employers due to increased employee turnover and lower worker productivity. That means employers must spend resources to hire and train new workers in a vicious cycle that turns off customers and may put downward pressure on profits.

The broader economic ramifications are equally troubling. The Urban Institute’s Maria Enchautegui finds that parents with non-standardized schedules are more stressed and spend less time with their children compared to  standard-schedule workers, with detrimental long-term individual and societal consequences. And in the short term, many employees caught up in “just-in-time” schedules end up working part-time involuntarily, because irregular schedules at one workplace make it impossible to commit to a second job. This loss of potential earnings deprives the economy of disposable income for consumer spending that fuels economic growth.

Some companies recognize the harmful effects of just-in-time scheduling on their employees, their customers, and their own bottom lines. Starbucks Corp. altered its policies following an article in The New York Times detailing the impact of its scheduling practices on an employee and her son. Wal-Mart Stores, Inc. introduced a new system that gives employees more control over their schedule. And Gap Inc. is working with University of California-Hasting’s College of the Law professor Joan Williams (who is also an Equitable Growth grantee) to measure how more stable scheduling practices affect both employee productivity and well-being as well as the clothing retailer’s profits at select stores.

If enacted, The Schedules That Work Act would give workers the right to ask and receive a more predictable schedule without being penalized; receive at least four hours pay if they arrive at work only to be sent home; require employers to notify their workers of any scheduling changes at least two weeks in advance; and require employers to provide an extra hour of pay if they make schedule changes less than 24 hours before a shift. The bill also includes an anti-retaliation section to protect workers asking for scheduling changes.  Vermont and San Francisco have already adopted laws that give workers the right to request more flexible schedules.

Much of the conversation surrounding low-wage workers focuses on the wages themselves. But policymakers and companies alike also need to understand the consequences of business practices such as just-in-time scheduling, which may affect not only the well-being of many workers, but also businesses, consumers, and the economy as a whole.