Hourly employees make up over 50 percent of the total US employee population and a critical segment of the workforce at many organizations. While employee engagement efforts typically focus primarily on salaried employees who are perceived as having more of a long-term commitment to the organization, hourly employee engagement and loyalty are growing concerns for HR leaders in today’s tight labor markets. According to recent Gartner research, hourly workers are more engaged in their jobs when they are satisfied with their employer’s diversity and inclusion efforts.
In the past year, we’ve seen many large companies launch new initiatives to better engage and retain their hourly employees, whether through education benefits or opportunities to work with local nonprofit organizations. HR leaders have also seen improvement of hourly employee engagement when these employees have positive perceptions of their organization’s D&I activities, our research finds. In fact, when hourly employees are satisfied with D&I, they exhibit almost twice the discretionary effort and almost three times the intent to stay compared to those who are not satisfied. However, only about half of hourly employees are currently involved with D&I efforts and HR leaders are uncertain how to use D&I to engage this population.
Our D&I research team has uncovered three ways HR leaders can leverage hourly employee engagement in D&I to make a positive impact on the organization:
Integrate D&I in Current Processes
HR leaders should integrate D&I efforts into pre-existing engagement initiatives, such as team meetings, to ensure that cultural values and behaviors are articulated and implemented consistently throughout the organization. This approach addresses a key challenge hourly employees face when connecting to D&I at their organizations: They do not feel included on their teams. By building hourly employee inclusion into existing processes, organizations can improve team performance without creating additional structures for HR to manage.
Two new proposals from the Brookings Institution’s Hamilton Project envision potential reforms to corporate and public policies to protect workers from the negative effects of non-compete agreements and other labor market practices the authors describe as anti-competitive. The first, written by Boston University professor Matt Marx, offers several suggestions for ensuring that non-competes are not abused, such as ensuring candidates are aware of them before accepting a job and improving non-disclosure agreements to be a better substitute for overly-restrictive non-competes.
The other paper, co-authored by economist Alan Krueger and law professor Eric Posner, takes a broader view of the problem of employers using their market power to suppress wages. In an op-ed at the New York Times, the authors highlight the crux of their argument:
The culprit is “monopsony power.” This term is used by economists to refer to the ability of an employer to suppress wages below the efficient or perfectly competitive level of compensation. In the more familiar case of monopoly, a large seller — like a cable company — is able to demand high prices for poor service because consumers have no other choice. It turns out that many corporations possess bargaining power over their workers, not just over their consumers. Their workers accept low wages and substandard working conditions because few alternative job opportunities exist for them or because switching jobs is costly. In other words, in the labor market, effectively a small number of employers are competing for labor.
The authors point to non-competes, anti-poaching agreements, or other forms of collusion, as well as mergers with adverse effects on the labor market, as the means by which companies keep wages low. This might be true, or there might be other tools that companies are using to hold back wage growth (e.g. pressure from the CFO to drive margin, or lobbying states and municipalities to not increase minimum wages). This public policy debate, however, misses a bigger issue that this strategy causes for the companies themselves.
A recent study from Cardiff University suggests that employees who work from home are more likely than their peers who work in the office to work extra hours and put extra effort into doing their jobs. The study, published in the journal New Technology, Work and Employment and covered by the Daily Mail, examined survey responses from 15,000 UK employees in 2001, 2006 and 2012, and found that 39 percent of at-home remote workers said they “often have to work extra time, over and above the formal hours of my job, to get through the work or to help out,” compared to just 24 percent of in-office workers. Also, 73 percent of those who work from home said they put more effort than required into their job, compared to 68.5 percent of those who work from the office.
Professor Alan Felstead, the study’s lead author, offered the Daily Mail a theory as to what was causing this discrepancy:
Professor Felstead said: ‘The evidence suggests that remote workers are over-compensating to prove to their colleagues they are not in their pyjamas at home and prove to their employers they are a safe pair of hands willing to go the extra mile in return for the discretion an employer gives them to work at home or in a remote location.’
Noting that the percentage of the UK workforce doing their jobs in a traditional workplace had fallen from 74.8 per cent in 2001 to 66.4 per cent in 2012, the study also pointed out that there were downsides to remote work in terms of employee wellbeing: Nearly 44 percent of remote workers reported that they had difficulty unwinding after a day at work, while only 38.1 percent of fixed-location staff said so. This, Felstead said, reflects the challenge for remote workers of setting clear boundaries between their professional and personal lives.
Another factor that might help explain why remote workers may be overcompensating is that they feel disconnected from their colleagues, Marianne Calnan adds at People Management: