NATIONAL REPORT—Predictive scheduling laws are continuing to hit properties within the nation. While this movement may not be everywhere just yet, it’s growing and impacting higher levels of government. There are ways for properties to get ahead of the game before it’s too late.
“State and local governments are increasingly considering and adopting scheduling laws requiring employers to publish employee work schedules a certain amount of time in advance,” said Benjamin O’Glasser, an attorney at Bullard Law, an Oregon-based firm specializing in labor regulations and law.
Major coastal cities have adopted variations of these laws over the past few years, including Seattle; San Jose, CA; and New York. “Predictive scheduling is a relatively new movement on the local level with certain cities and other localities having passed laws,” said Jeffrey H. Ruzal, member of Epstein Becker Green, a national law firm with experience in labor and employment laws, and numerous industries, including hospitality. In 2014, San Francisco became the first city in the country to implement predictive scheduling laws.
“Aimed at larger retailers and quick-service restaurants, the ordinance essentially requires a two-week advance notification for scheduling, with penalties for adding or subtracting hours within the two-week window,” said Lynn Mohrfeld, president and CEO, California Hotel & Lodging Association.
San Francisco’s Formula Retail Employee Rights Ordinances in summary require the following from the city’s employers: Provide employee schedules at least two weeks in advance; pay on-call employees two to four hours of pay if they end up not having to work; and pay employees one to four hours of pay if changes are made to scheduling with less than seven days notice.
“These laws are largely intended to benefit employees in the hospitality and retail industries, where lower-wage-earning employees have a greater need for work time predictability on account of family and other responsibilities, such as supplemental jobs, education and child care,” Ruzal said.
Also expressed in the city’s scheduling ordinances: the initial estimate of work schedule, which requires employers to provide new employees with a “good faith” written estimate of the employee’s expected minimum number of scheduled shifts per month, and the days and hours of those shifts.
“The laws operate from the premise that employers should not be able to externalize the costs of scheduling changes to their hourly workers,” O’Glasser said. “Employees who make advance arrangements that allow them to report for work are permitted to place greater reliance on their employer’s published schedule. Employees can better forecast their income based on a published scheduled, allowing them to plan to pay their rent and other bills.”
Oregon in the summer of 2017 became the first state to adopt a statewide scheduling law; however, the state’s law won’t go into effect until July 2018. Oregon will begin enforcing the adopted scheduling law in January 2019.
“Oregon’s law includes a statewide preemption provision that ensures that Oregon cities cannot adopt scheduling ordinances,” O’Glasser said. “Employers should know that not all predictable scheduling is created equal.”
For example, comparing Oregon’s law with Seattle’s ordinance, the former is more restricted in scope than the latter. “Generally, statewide legislative processes seem to produce more moderate legislation in this area, especially where—as in Oregon—both labor and management perspectives are involved in the drafting process,” he said. Other states have adopted legislation to prevent localities from developing patchworks of local scheduling laws.
“Both Oregon’s law and Seattle’s ordinance prohibit employer retaliation for scheduling-related requests, but offer very different standards,” O’Glasser said. “Seattle’s ordinance creates a rebuttable presumption of retaliation if there is any adverse employment action within 90 days of an employee exercising a right under the ordinance (which would include virtually any scheduling-related requests). In contrast, Oregon’s law merely prohibits retaliation for scheduling-related requests.
“Three other areas where the laws differ include whether there are provisions related to ‘clopenings’ (closing a business at night and then returning first thing in the morning to reopen the same business), additional requirements for giving current employees the right of first refusal for shifts, and requirements for ‘voluntary standby lists’ that can be used to fill shifts on short notice without triggering premium pay requirements created by the new laws.”
While predictive scheduling laws are designed to protect employees, they more often than not present employers with numerous challenges. “Obviously, more planning is required by employers, and response to customer demand is more costly within the two-week period,” Mohrfeld said. “It restricts employers’ ability to be able to allow flexibility—if an employee states they are available for work extra shifts, this is more costly and difficult within the two-week period.” Disadvantages to employers are greater than just limited flexibility, however.
“The laws and ordinances create quasi-contractual rights for employees on the basis of a published schedule,” O’Glasser said. “Because of penalty wages or premium pay for shift schedules, an employer may lock in a significant percentage of their payroll costs weeks before the employees ever report to work. Although there are some carve-outs for schedule changes that are the result of natural disasters, the laws generally add a layer of costs associated with any adjustments a covered employer seeks to make: covered employers have a new disincentive to nimbly respond to customer demands and other emergent business needs that would require staff adjustments.”
There are ways for employers to adapt more quickly to predictive scheduling laws. “Employers can overcome such challenges by studying historical trends in employee staffing needs, which may help forecast current and future needs; enact and enforce workplace policies and practices disallowing employees from requesting schedule changes and accommodations without sufficient advance notice; and try to create workplace schedules as far in advance as possible, even in advance of the legally required time periods, to help create a predictable rhythm in the workplace,” Ruzal said. This stresses the need for employers to keep accurate records of employee scheduling.
Predictive scheduling laws and ordinances may hit employers with unionized workforces hard. These new regulations may require employers to conduct mid-contract bargaining over changes to terms and conditions that are related to already agreed to employment scheduling practices in prior agreements.
“Labor agreements holistically set the operational rules and labor costs for a fixed period of time that makes sense for the overall labor-management relationship, in light of the employer’s specific operations and industry,” O’Glasser said. “Some of the scheduling laws contain language that exempts unionized workforces from coverage only if their labor agreement contains ‘equal to or better’ employee protections. Therefore, these new laws can upset the balance struck between an employer, and its unionized workforce by invalidating existing and mutually-agreeable scheduling rules in a labor agreement.”
New predictive scheduling laws could provide employers with some advantages, even if the benefits are “nebulous and speculative at best,” he said. Some believe these new laws will “elevate employee morale and lead to better employee performance, including outward facing customer service over time.” While many employers may not have to take predictive scheduling laws into account just yet, change may be on the horizon.
“The trend in predictive scheduling laws is expected to continue, most likely in states and localities that maintain other employee protective laws and regulations, such as tip credit and sick time laws, rules and regulations,” Ruzal said. HB