In the hospitality industry, retail businesses and quick-service restaurants especially, on-call scheduling has been the norm, making it difficult for employees to anticipate pay, establish a healthy work-life balance or even determine the number of hours they are likely to work each week.
In response to these difficulties, many cities are adopting a new type of law known as predictive scheduling, which requires an employer to notify an employee of their work schedule in advance. While these laws are designed to provide employees with a "good faith" estimate of their upcoming schedule, they pose new challenges for business owners as well.
Here's what you need to know about predictive scheduling, the law, and how you can implement a program that benefits both your employees and your business.
What is predictive scheduling?
Predictive scheduling is when an employer provides an employee with their schedule in advance. For employee schedules that frequently fluctuate, part-time employees who do not work full workweeks, or anyone who works for an hourly rate, predictive scheduling can help establish a predictable schedule and help employees better estimate their expected pay for a weekly or monthly period.
Predictive scheduling is largely a response to the challenges associated with on-call scheduling, a workforce management method that availed hourly workers when needed in order to accommodate influxes of customers at irregular times. On-call scheduling offered business owners flexibility, but at the expense of predictable employee schedules.
In the past few years, predictive scheduling laws and regulations have become more common, especially in industries where part-time jobs and minimum wage positions are prominent.
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How does predictive scheduling impact the employee?
Any employee who has been subject to an unpredictable work schedule knows just how difficult it can be. Without any stable pay or a structured work-life balance, employees are often unable to schedule important things around work, such as child care or medical appointments. Predictive scheduling legislation seeks to ameliorate these challenges by giving employees a window into their upcoming work schedule, either by banning on-call scheduling altogether, requiring employers to give employees their schedules a week or two in advance, or offering compensation for on-call shifts that never materialize.
"[Predictive scheduling] laws give hourly employees fair opportunities and the ability to achieve an unprecedented work-life balance," said Steven Power, global president of Deputy. "By knowing their schedule beforehand, employees have more control for how to plan their lives. This is especially necessary for workers with family and other ongoing commitments. Predictability leads to employee retention and can be a boon for talent recruitment."
Predictive scheduling and the law
Many cities and more than a dozen states have proposed regulations around predictive scheduling or are considering legislation that would create a predictive scheduling policy. In San Francisco, for example, employers are required to provide employees with their schedules at least two weeks in advance and make no changes to that schedule with less than seven days' notice. San Francisco's law also requires that on-call employees are paid for two to four hours of a shift whether they are called in or not.
Seattle similarly requires 14 days' notice of schedules, as well as compensation for schedule changes after work schedules have been posted. In New York City, employers are required to post schedules at least 72 hours prior to any shift, as well as schedule all retail employees for a minimum of 20 hours of work for every two-week period. States that have adopted predictive scheduling laws also include New York, California, Washington and Illinois, as well as several others.
While predictive scheduling legislation varies from city to city and state to state, it is becoming a more common practice in public policy. As an employer, it is your responsibility to confirm your compliance with the regulations the govern your local and statewide operations. Failure to do so could open your business to financial penalties and lawsuits. [Interested in time and attendance software for your small business? Check out our best picks and reviews.]
What industries does predictive scheduling impact most?
Predictive scheduling laws are specifically targeted to businesses in industries where on-call scheduling, hourly employees and minimum wage employees are most common. The law also focuses on those industries that reserve a portion of their hourly employees for fluctuations in activity, such as retail businesses during holiday seasons, restaurants that have anticipated peak hours and seasonal businesses in the hospitality industry.
Predictive scheduling offers benefits to employers
Predictive scheduling doesn't only benefit employees at the expense of business owners in these industries, however. Adopting a predictive scheduling policy goes beyond compliance, sometimes generating benefits for employers as well. For example, an effective predictive scheduling program helps employers recruit and retain employees, reducing turnover and the costs associated with training new hires.
"More predictable scheduling can also lead to happier, more engaged employee," said Atif Siddiqi, founder and CEO of Branch. "Without the added concerns of an unpredictable schedule, employees are less likely to have stress that will impact their work productivity. This can lead to decreased turnover for employers as well, as the cost of replacing an hourly employee is about $2,500."
While it represents an adjustment to current practices in many cases, predictive scheduling also establishes a routine that helps managers more effectively anticipate and plan for spikes and dips in business activity.
Leveraging time and attendance software for predictive scheduling
Implementing a predictive scheduling policy could pose some unique challenges at first, but with the help of careful planning and rapidly developing software, including machine learning algorithms, many employers might find it is easier than it sounds.
"For smaller business owners using manual scheduling processes, the rollout of these laws can cause confusion, which leaves themselves open to risk around noncompliance, and the consequences of rectifying noncompliance can be expensive," said Power.
For those businesses, Power recommended moving away from manual scheduling processes to online employee scheduling software, which can ease the burden of adopting a predictive scheduling policy.
"Most scheduling software has the ability to autoschedule, which ensures that the employer is meeting all of the laws across all locations," Power said. "The online platform also enables employees to check and change their schedules from anywhere as well as pick up additional shifts if they're eligible, which gives the employee more power and control over their schedule resulting in an overall happier and more productive workforce."
Be sure to communicate the changes to your workforce as well, and train them on the use of any automated systems you might implement to support it. As it is with any major changes to business process, communication is key. Transparency can help ease your staff through any changes and reduce the obstacles you encounter while adapting to the new system.
Predictive scheduling isn't going away
Since predictive scheduling is increasingly enshrined in local and state law, it is an unavoidable aspect of doing business in the industries it impacts today.
Rather than begrudging the new requirements, employers that embrace predictive scheduling and implement software solutions to not just ease the burden but make predictive scheduling a more effective part of the way they do business will find success.
Working to develop a seamless and easy predictive scheduling policy can result in happier employees, reduced turnover costs and a more efficient workflow that still meets the fluctuating needs of your business. Predictive scheduling isn't going away, but it doesn't have to be a challenge; in fact, it could be a great opportunity.