For retail workers, a “flexible schedule” often means erratic shifts and uncertain incomes. However, this holiday season Toys“R”Us® chose to provide more consistent hours over more flexible hours.
Toys“R”Us® reduced its part-time seasonal hiring by about 10% this year, but in exchange, those seasonal workers may triple their working hours. Last year’s holiday hires worked an average of seven hours per week, so the average warehouse worker at Toys“R”Us® made less than $75 per week. This year, Toys“R”Us® says hours will average between 18 to 20 hours per week, meaning workers could nearly triple their earnings. Providing better schedule adequacy, or enough work hours or shifts to cover an employee’s financial needs, will not only be an accomplishment for Toys“R”Us® but also a great benefit to the employee.
Receiving a higher number of work hours may even be more important to wage stability than receiving a higher base rate of pay. This is a talent retention secret that most employers (and employees) do not recognize.
Lack of schedule adequacy frustrating, and may drive employees away
Many retailers believe that their employees would “leave our stores for a store down the street offering $0.50 more per hour,” but this oversimplifies their turnover issue. If an employee was truly seeking to maximize her earning potential, then she would also need to consider the average hours she works per week. She could double her base wage rate, but if she received half as many hours, her true earnings would remain stagnant. The underlying cause of many turnover cases is a lack of schedule adequacy—employees not receiving enough shifts, therefore not making enough money to stick with the job.
In October 2015, there were 5.8 million people working part-time due to economic reasons, meaning that these workers received fewer hours than they actually wanted. Yet, at the same time, retailers hired more workers for part-time seasonal work. Toys“R”Us’® holiday hiring strategy addresses the problem of involuntary part-time work. Instead of just stopping one poor practice (like on-call scheduling), Toys“R”Us® devised a strategy to better optimize current labor resources. Some downplayed the hiring and labor strategy by chalking it up to “changes in the way consumers shop,” but that opinion should not take away from celebrating Toys“R”Us’® innovation.
Better schedules have incentives
Interestingly, Toys“R”Us® created this strategy without the push of state or federal regulation (which may be coming soon to the retail industry). Providing adequate, stable, and predictable hours has benefits beyond compliance. Better schedules can actually provide a competitive advantage in recruiting and hiring top talent if employers leverage their schedules correctly.
Here are just a few ways retailers, even Toys“R”Us®, could bump up the value of an adequate schedule:
- Add to the “Now Hiring” sign. During the holiday months it seems likeeveryone is hiring. Retailers can distinguish their stores by including details about their schedules like, “We provide at least 15 hours of work every week.”Some bold employers even guarantee a set number of hours.
- Convert hours to money. During the hiring process, employers tend to focus on wage rates. However, if HR or operational managers mapped out the monetary value of a consistent schedule or adequate number of hours for workers, they could demonstrate value beyond a higher starting wage.
- Schedules as part of employer branding. There seems to be a trend among consumers towards “organic,” “local,” and “fair trade,” and some retailers have made it a part of their branding and marketing. Why not take it a step further and provide sustainable schedules? If a retailer’s brand promises to deliver top quality products, then the product handlers and ambassadors should also be of top quality. Publish quantifiable metrics on schedule equity and quality to increase the effect of your brand.
- Tailor shifts to specific outcomes. Providing employees with longer shifts creates more ownership over an employee’s work and more of an incentive to show up (longer shifts = more pay). Have managers track absence rate trends year to year (was there a decrease due to longer shifts?), or compare length of advanced notice to absence rates (did a predictable schedule give teams time to arrange a replacement before an absence?).
Be the employer your employees ask for this season
Many retailers continue to struggle with labor and demand prediction. They feel as if the only thing consistent about their schedules is the inconsistency. However, historical sales or demand data and employee preferences can give retailers a good baseline for building an adequate, stable, and predictable schedule.
Especially during the holidays, absenteeism, overtime, and turnover are labor issues that directly affect a business’s bottom line. When retailers don’t understand the impact of their daily scheduling practices—whether such methods are helping or hurting the business—then they risk increasing their labor costs.
This holiday season, retailers should “gift” their managers with a method and a set of metrics to create a balanced schedule and their employees with adequate and stable hours. In return, thankful employees may gift such employers with a few items on their list like higher engagement, increased productivity, and greater retention!