As the advent of the gig economy has highlighted the precarious nature of many non-salaried workers’ incomes, predictable scheduling has practically eclipsed the minimum wage as the labor rights cause of the day, both in the US and in other countries. In the past year, we’ve seen cities like Seattle and New York pass “secure scheduling” laws mandating guaranteed hours for certain classes of hourly employees, and Oregon is on its way to becoming the first state with such legislation.
That many Americans work unpredictable hours from week to week is not in dispute, but opponents of these mandates argue that they impose unreasonable burdens on employers in industries like retail and food service where turnover is high and demand is naturally unpredictable. There is also some debate over just how big a problem variable scheduling is. A recent Gallup survey, for example, finds that among the one in six US employees who are paid hourly and say their hours vary each week, 67 percent say their variable schedules are not causing them financial hardship:
These results are based on interviews conducted Aug. 23-Sept. 4 with 528 hourly workers who say the number of hours they work each week varies. Thirty-seven percent of all hourly workers — equivalent to 18% of all U.S. workers — say the number of hours they work varies from week to week, while the rest say their hours are fixed.
Amazon rocked the grocery world on Friday when the e-commerce giant announced that it had sealed a deal to acquire Whole Foods Market for $13.7 billion. The news sent the stocks of competitor grocery chains tumbling, indicating the degree to which investors expect this move to shake up the industry. However, the Washington Post’s Abha Bhattarai notes, “some analysts say Amazon is likely to face significant challenges as it expands into a notoriously difficult business with low profit margins”:
Amazon and Whole Foods are very different businesses: One is a technology company that wins over customers with sophisticated algorithms and low prices. The other, nicknamed “Whole Paycheck,” is known for the premiums it charges for specialty foods and its workplace culture that compensates cashiers and other staffers well. Both are led by hard-charging entrepreneurs who have spent decades turning their companies into iconic, multibillion-dollar businesses.
Similar questions were asked last year when Walmart acquired the e-tail startup Jet.com, as part of its own effort to compete with Amazon: How well will these two companies, with their very different cultures and business models, be able to integrate? But these differences between Amazon and Whole Foods may be part of what makes this acquisition such a game-changer, Slate’s Will Oremus figures:
Suddenly Amazon owns a nationwide network of already-popular grocery stores that have already solved the tricky logistical problems involved in sourcing and storing fresh food. What Amazon brings is the world’s largest online sales portal and its mastery of the home-delivery business. Scale, meet scale. Logistics, meet logistics. Loyal customer base, meet loyal customer base. If you’re in the grocery business and your name is not Amazon or Whole Foods, today is not a good day for you.
Walmart’s acquisition of the e-tail startup Jet.com last summer and hiring of Jet CEO Marc Lore to run its entire e-commerce operation indicated that the retail giant was looking to make a big push into this sector and offer Amazon its first genuine competitor. Now, Walmart is piloting a program to leverage its massive brick-and-mortar infrastructure and retail staff to augment its e-commerce business by having store employees make last-mile deliveries of online orders, TechCrunch reported last week:
The idea is an expansion on the retailer’s recently launched 2-day shipping program, which lets customers order from over 2 million online items for fast delivery without an annual membership. The company said it realized those same trucks could just as easily bring any Walmart.com or Jet.com ship-to-home orders to its stores, then allow the local staff to drive the packages to customers’ homes.
The test started small. Launched in April, there are only two stores in New Jersey and one in northwest Arkansas that are running this program today. But Walmart is already touting how the early results are promising. For store employees who opt to sign up to do deliveries, it’s a way to earn extra cash – often just by expanding their commute home a bit. … A lot of technology has gone into the development of this program, hinting that this test is being seriously considered as an alternative way to handle last-mile deliveries at scale.
The company is presenting this move as part of an employee-centered approach to its e-commerce operation. At its shareholder meeting on Friday, according to Reuters, Walmart executives indicated that they were aiming to drive more online sales without alienating their employees:
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:
Eric Broder Van Dyke/Shutterstock.com
Amazon may have massively expanded the size of its robot workforce in the past year, but that doesn’t mean it’s not hiring human beings, too. On Thursday, the e-commerce giant announced that it was planning to add more than 100,000 new jobs in the US over the next 18 months, growing its workforce by over 50 percent to more than 280,000 employees, Reuters reports:
Amazon is spending heavily on new warehouses so it can stock goods closer to customers and fulfill orders quickly and cheaply. The new hires, from Florida to Texas to California, will be key to the company’s promise of two-day shipping to members of its Amazon Prime shopping club, which has given it an edge over rivals. A BGC Partners analyst, Colin Gillis, said hiring was expected. “Amazon continues to meaningfully grow above e-commerce rates and continues to take share from traditional retailers,” he said.
The e-commerce giant said in October it would add 26 fulfillment centers in 2016, mostly in North America. More are under construction. The new jobs will extend beyond Amazon’s Seattle headquarters to communities across the United States, CEO Jeff Bezos said in the release. Amazon did not break down what share of jobs would go to corporate roles versus fulfillment work.
At the same time, Amazon’s wholesale disruption of the way Americans shop has led to a great deal of “creative destruction,” hurting brick-and-mortar retail and now threatening to upend the traditional grocery store as well. While these innovations may be a net positive for the economy, the New York Times points out that many workers will inevitably lose out in the change:
Amazon's Dupont, WA fulfillment center (Christina Crea/JBLM PAO/Flickr/PD
Amazon, the automation-loving e-retailer which earlier this month outlined its plan for a cashier-less retail store, says it now has 45,000 robots working across more than 20 of its order-fulfillment centers. That marks a 50 percent increase of its robot workforce from a year ago (when they were deployed at 13 fulfillment centers), to go along with a human workforce of some 200,000 full-time and seasonal staffers over this year’s holiday shopping season. (The robots mostly contribute manual labor, while people still handle the finer-skilled and thinking jobs.) As the Seattle Times points out, Amazon now has a larger army of robots than the Netherlands has people in its actual army, and as Geekwire adds, the ratio of overall robots to people at Amazon has increased by as much as 14 percent, based on the company’s full third-quarter employment figures.
As with the manufacturing sector, the ratio of robot to human workers in American warehouses will undoubtedly shift more and more toward the bots in the coming years, as automation technology continues to provide greater efficiency and cost savings to the companies that can afford to adopt it. A Deutsche Bank analysis over the summer estimated that Amazon, by installing the company’s exclusive floor-patrolling Kiva robots at a fulfillment center, reduces its expenses by $22 million (or 20 percent) per warehouse, and also increases the inventory capacity of Kiva-equipped facilities by a whopping 50 percent.
Meanwhile, other e-commerce giants have been following Amazon’s automation-centric lead, albeit with more limited gains, and new types of warehouse robots are being quickly developed and deployed, as Kim Bhasin and Patrick Clark explored last June for Bloomberg:
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.