Apr 15, 2015

A Tech Solution to the Minimum Wage Debate

There’s a lot of debate over the minimum wage out there and with good reason. Overwhelmingly, people are recognizing a need to help improve the lives of people with lower earnings, but not everyone is in agreement on what exactly to do about it.

Currently the national minimum wage in the United States is set at $7.25 an hour. For some time now, President Obama has been pushing to increase it to $10.10 an hour. States like Massachusetts have recently passed $11 minimums and some large cities, such as Seattle and San Francisco, are advocating $15 minimums to be implemented over several years. As with most issues, there are a lot of different opinions across the political spectrum. Supporters say it is necessary to combat pay inequality and that it would help grow the economy by increased spending. Critics say such a change would increase the financial burden on employers causing them to reduce staffing which could lead to the destruction of over a million jobs.

However, when focusing on improving the needs of part-time hourly workers, we may want to look beyond just the wages.

I’ve had quite a few jobs in my career where I was paid hourly and where someone was responsible for scheduling my time. I’ve been a packer in a warehouse, a cashier at a grocery store, a waiter, and I’ve worked in customer service. All of these jobs helped me meet some financial needs and were rewarding for the experience gained. Like most part time workers, I cared a lot about getting a consistent number of hours of work per week. This way, I could ensure that I was making the amount of money I needed. However, very often this didn’t pan out.

Because my schedule was variable, I would regularly find out my schedule with very little time to coordinate other commitments. Sometimes this meant giving up a shift without the guarantee to pick up another one. Furthermore, there was little consistency from one week to the next and some weeks I would be scheduled for too many hours and others too few. Since managers typically don’t have time or interest to deal with too many schedule changes, I was typically forced to just deal with it. This lack of proper shift management resulted in totally unpredictable pay.

Apparently, not much has changed in recent years. Speaking last weekend to a former store employee from Sunglass Hut, I reconfirmed that it was normal for the store to add and reduce employee shifts unexpectedly. She said, “I would get last minute requests all the time and often had to turn them down due to other obligations… I lost the hours I needed and the store was often short-staffed”.

Let’s take a look at how this can affect a part time worker:

If you planned on working 25 hours this week, but somehow due to a scheduling mishap, you lose a shift and end up only working 21 hours. That is more than a 15% drop in income. With no guarantees in-place for part-time workers, variable schedules and changing numbers of hours per week can cause severe hardship as they try to meet their financial obligations and family responsibilities.

The frustrating part is that often the reason for fewer hours is due to operational inefficiencies which lead to poor planning and communication. It is not uncommon for an employer to have actually needed the employee to work more hours, but due to late scheduling (or other scheduling issue), the employee was not able to work and both sides suffer.

For workers and employers experiencing these types of problems with their scheduling, a proper solution may have a much bigger life impact than the proposed changes to the national minimum wage. While anyone will agree that earning more money for the same hours of work is attractive, the introduction of fairer, planned and consistent schedules will significantly help the quality of life for workers in a way that is equally as attractive for their employers.

New approaches to help address these problems are on the way. This is just one piece of WorkJam’s win-win achievements for employees and employers.

In an upcoming blog we will look at the trend of employers scheduling hourly workers based on consumer demand and how this can actually be a good thing for employers and their employees.

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