Pared, an on-demand hiring platform for restaurant workers, has raised a $10 million financing round led by CRV, TechCrunch reported last week. The platform aims to help restaurants fill last-minute staff shortages, particularly in back-of-house roles like line cooks and dishwashers, but could conceivably be used for waitstaff and other front-of-house positions as well:
Restaurants go to the app and say they are looking for what the app calls a ‘Pro’ in whatever role they need, and are able to book the employee right away for the slot they have in their schedule. It might come at a slight premium over the typical hire, but restaurants are already willing to pay overtime in order to cover those gaps and keep things moving smoothly, [co-founder Dave] Lu said.
For employees, it’s a pretty similar experience — they see a job posted on the app, with a time slot, and they make themselves available for an hourly wage. The second benefit, Lu said, is that they can start to slowly make a name for themselves if they are able to prove out their skills and move up the ranks at any of those restaurants. The culinary community is a small one, he said, and it offers a lot of room to start building up a reputation as an exceptional chef or just finally get a first shot at a sauté position in the kitchen after working at the back of the house. That, too, might be part of the appeal of jumping on a service like Pared rather than just driving for Uber.
Pared is part of a growing ecosystem of platforms offering an “Uberized” approach to hiring hourly workers in various roles. By catering exclusively to restaurants and promising to help chefs build their personal brands, Pared is looking to build its own reputation as a reliable place to find quality kitchen talent on short notice.
These new platforms are emerging in retail and food service to address these industries’ unique staffing and scheduling challenges: Customer traffic is variable, but employees’ availability may not be. To address this mismatch, technological solutions are being built to help connect businesses in need of shift workers on short notice with employees willing to take those shifts, on the employees’ terms. For instance, Legion, another startup that raised $10.5 million in first-round funding last year, is using big data to better predict customer traffic and schedule the right amount of staff in advance.
In a randomized, controlled experiment at Gap, researchers Joan C. Williams, Saravanan Kesavan, and Lisa McCorkell sought out the effects of more versus less predictable schedules on the productivity of retail employees and the profitability of stores. “The results,” they write at the Harvard Business Review, “were striking”:
Sales in stores with more stable scheduling increased by 7%, an impressive number in an industry in which companies work hard to achieve increases of 1–2%. Labor productivity increased by 5%, in an industry where productivity grew by only 2.5% per year between 1987 and 2014. Our estimate is that Gap earned $2.9 million as a result of more-stable scheduling during the 35 weeks the experiment was in the field. Given that out-of-pocket expenses were small ($31,200), our data suggest that return on investment was very high. (If stable scheduling were adopted enterprise-wide, transition costs might well entail the costs of upgrading or replacing existing software systems.)
Unlike the typical way of driving sales through increase in traffic, the sales increase from our intervention occurred due to higher conversion rates and basket values made possible through better service from associates.
These findings, the authors underscore, contribute to a growing body of empirical evidence that lean staffing practices, with most employees on part-time, unstable, and on-call schedules, are not the money-savers they are often believed to be. It is indeed feasible for retailers to offer their employees more stable and predictable schedules, they add, but employers often overstate the benefits of an on-call system (reduced labor costs) while ignoring its drawbacks (such as poorer customer service and more management time devoted to scheduling).
This research comes at a time when schedule predictability has emerged as a focal point of labor activism and attracted the attention of regulators. San Francisco became the first major city to mandate predictable scheduling with its “retail workers’ bill of rights” in 2014, while Seattle passed a mandate in 2016 and New York City introduced a fair scheduling law for retail and fast food employees last year. Oregon became the first state to enact such a regulation statewide last summer and other states are mulling laws of their own.
The campaign to crack down on variable or on-call scheduling is emerging as a central issue for labor activists in the US today, second only to the minimum wage. Oregon is currently on track to become the first state to introduce regulations obligating most employers to provide predictable schedules to their hourly employees. A bill mandating advance notice of scheduling passed the state Senate last year and is returning to the House for a final vote, the Statesman Journal reported this week:
The bill’s provisions would apply to retail, food service and hospitality employers with at least 500 workers worldwide. That’s up from 100 statewide in the original bill. Individually owned franchises would not be covered. If the bill passes, beginning July 1, 2018, those employers would have to provide workers with an estimated schedule seven days before the first day of that week’s work. That’s down from 14 days in the original bill. The advance notice requirement would increase to 14 days on July 1, 2020. Enforcement would begin Jan. 1, 2019.
The bill also requires employers to provide extra pay to workers who have fewer than 10 hours off between shifts, allows workers to turn down extra shifts, and allows employers to maintain standby list of employees who are willing to be called into work on short notice. And it prohibits cities and counties from setting their own scheduling regulations.
New York City Mayor Bill de Blasio signed a suite of bills into law on Tuesday that will require fast food and retail employers in the city to provide employees with more predictable work schedules, Reuters reports:
A key component of the package is a requirement that fast food restaurants schedule their workers at least two weeks in advance or pay extra for shift changes. … The legislation also ensures that fast food workers have breaks of at least 11 hours between shifts and are given the option of working additional hours before their employers hire extra workers. …
The New York City package, which takes effect in six months, also would ban unpaid on-call scheduling of retail employees and would enable fast-food workers to contribute voluntarily to worker advocacy groups or other non-profit groups, but not unions, through payroll deduction.
With this legislation, New York becomes the third (and by far the largest) US city to take aim at the controversial practice of on-call scheduling, which San Francisco targeted in its 2014 “retail workers’ bill of rights” and Seattle banned in a law its City Council passed last year. Another such law is scheduled to take effect July 1 in the Bay Area city of Emeryville, CA, and similar scheduling bills have been introduced at the state level in Connecticut, Minnesota, North Carolina, New Jersey, New York, Oregon and Texas.
According to the New York Daily News, however, New York State Governor Andrew Cuomo is working on a series of regulations that would preempt the city’s and offer employees somewhat weaker protections, albeit more than they currently enjoy:
On-call scheduling, in which hourly employees receive little advance notice of the hours they will be working in a given week, has arisen as a major target of labor rights activism in the US this year, while the similar practice of zero-hours contracts has come in for increased scrutiny in the UK. Partly in response to this pressure, Starbucks made changes to its scheduling practices and Walmart is piloting a technological solution to give employees more predictability without sacrificing flexibility. Local regulators are also acting on the issue: In September, Seattle passed a law mandating “secure scheduling” for retail and fast-food employees, similar to one San Francisco adopted in 2014, and New York is considering its own scheduling regulation.
Now, Buzzfeed’s Cora Lewis’s reports, six major retailers have agreed to end on-call scheduling after an inquiry by nine state attorneys general into the use of this practice:
Since authorities in New York began a probe into the practice last year, retailers including Abercrombie & Fitch, Gap, J.Crew, Urban Outfitters, Pier 1 Imports, and L Brands (the parent company of Victoria’s Secret and Bath & Body Works) eliminated it outright.
The Seattle City Council on Monday unanimously approved a new law that requires large retail and fast-food employers to schedule employees’ shifts 14 days in advance and compensate them for any last-minute changes to their schedules, the Seattle Times reports:
The law is expected to take effect in July and will apply to large retailers and quick-serve food and drink establishments with 500 or more workers, and to full-service restaurants with both 500 or more employees and 40 or more locations. Backers say the law will protect employees from erratic and variable work schedules and from not getting enough work hours.
Employers would be required to give good-faith estimates of hours an employee can expect to work upon hiring, post work schedules two weeks in advance, provide at least 10 hours rest between opening and closing shifts, give available hours to existing part-time employees before hiring new workers, and pay additional “predictability pay” when employers make changes to the posted schedule. The measure also requires employers to keep records for three years, documenting everything from responses to employee requests for schedule changes to good-faith estimates of the number of hours an employee could expect to work.
San Francisco became the first American municipality to mandate “fair scheduling” when its Board of Supervisors passed a “retail workers’ bill of rights” in 2014. New York City officials also announced last week that they were looking into introducing similar legislation for fast food workers. Prompted in part by the rise of scheduling software that allows employers to staff more efficiently but leaves many employees not knowing their work schedules until the last moment, the fight over scheduling is fast supplanting efforts to raise minimum wage as the labor cause du jour, Adam Chandler remarks at the Atlantic:
After an investigation by the Guardian brought to light that many of its employees were effectively earning less than the minimum wage, Sports Direct, the UK’s largest sportswear retailer, pledged a series of worker-friendly policy changes, including guaranteed hours for its store staff. Previously, many of these employees were on zero-hours contracts, under which the company was not obliged to give them any work in a given pay period, nor were they required to accept the hours offered. The high-profile case has put a spotlight on zero-hours contracts, and now the major pub chain JD Wetherspoon is also considering getting rid of them.
Meanwhile, a report from the Office for National Statistics came out last week showing how common these contracts are in the UK, finding that 903,000 British employees are working on zero hours. Emily Burt discusses the report at the CIPD:
The rate of increase in the use of such contracts was up on the previous year. In total, an extra 159,000 people were employed on zero hours in the last 12 months, compared to an increase of 120,000 in the 12 months to September 2015. The ONS said the increasing use of zero hours could be partly attributed to an increased recognition and awareness of what such contracts entail. It said the flexibility offered by zero-hours contracts can make them an attractive prospect for both employers and employees who are looking for work without the obligation of a permanent contract. …
The report revealed that two-thirds of the increase (66 per cent) in zero-hour contracts was down to people who had been in their role for more than a year. This could be because of heightened awareness, but another possibility is that workers had been moved from fixed contracts on to zero-hours by their employer, which could be related to a slowing of permanent hiring in the immediate wake of the EU referendum.
At Personnel Today, Rob Moss digs deeper into the numbers: