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On-call employment: Good for retail business, bad for workers

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Like generations of college students, Caprice Taylor needed a job to help pay her school and living expenses. For the 24-year-old student of fashion merchandise management at the Fashion Institute of Technology in New York City, sales work at a retail clothing shop seemed like a good option.

Taylor was hired last year at Club Monaco, a high-end clothing and apparel retailer owned by Polo Ralph Lauren. But her scheduled shifts at the Manhattan store were not guaranteed. Instead, she was given call-in shifts, which required her to call the store two hours before she was scheduled to arrive to see if she was needed.

Most often, she was not.

For months, Taylor said, she arranged her personal life around work days, waiting in her apartment, only to call in and learn the store wasn't busy enough. On some weeks, Taylor logged as few as six hours, not earning enough to keep up with her living expenses.

"It puts your day on complete hold," Taylor said. "It pressures you."

After four months of unpredictable paychecks, Taylor quit. She later found work at a Polo Ralph Lauren store that does not have on-call shifts. She was lucky to find it. Retail watchers say big-box stores and shopping-mall stalwarts are increasingly hiring workers for on-call shifts, a trend that cuts labor costs for employers, but leaves workers like Taylor struggling to get by.

The clothing and accessory retail industry is a relative bright spot in the moribund jobs market. Yet like Taylor, many workers are finding the jobs unpredictable at best, providing smaller paychecks and less stability than in the past.

From 2002 to 2011, the number of nonsupervisory jobs in the retail clothing industry rose 7 percent to 1.13 million, according to the Bureau of Labor Statistics. The industry declined during the recession, but the decline was not as dramatic as for the jobs market as a whole.

Despite the steady numbers, the quality of the retail sales positions is falling by at least one key figure -- the average number of hours they provide. In 2011, nonsupervisory workers in the clothing retail industry worked an average of 22 hours a week, three hours less than in 2005. That drop in hours hit them in the paycheck.

Although average hourly wages rose by 40 cents to $11.47 during that time, workers earned an average of $248 a week, $22 dollars less than the pre-recession peak. For call-in shift employees, the situation is often far worse, said Carrie Gleason, director of Retail Action Project, a New York City retail worker advocacy group. The biggest problem with call-in shifts, Gleason said, is unpredictability. Employees can't make reliable budget decisions because they don't know how much money they will make each week, she said. And for parents, it's difficult to find flexible daycare providers to work around call-in shifts.

While many have lamented the decline of traditional employment benefits, including paid time off and employer-sponsored health insurance, Gleason said call-in workers are struggling simply to make enough money to get by. They rarely are offered benefits, Gleason said, because they work too few hours and turnover is high. "It leaves workers scrambling and creates a situation where people are struggling along," Gleason said.

Susan Lambert, a University of Chicago professor who studies hourly and low-income labor, said employers have an incentive to hire a large pool of workers and schedule call-in shifts based on demand. "It gives managers a lot of flexibility when you have a workforce that is hungry for hours," Lambert said.

Pressure to contain labor costs is not new, but Lambert said it has increased since the recession. In addition to retail, on-call jobs are now common at hotels, airlines, in the package delivery industry, and even in some financial services jobs, she said. "This is so much bigger than it was 10 years ago," Lambert said. "It's becoming common practice for companies to have a large portion of their sales force on-call."

For retailers, scheduling on-call shifts helps drive down labor costs, which Fred Hurvitz, a professor at Penn State's Smeal College of Business, said can account for 40 percent or more of their total expenses. As brick-and-mortar retailers face stiff cost competition from online retailers and pressure to drive down prices, Hurvitz said, they are increasingly searching for ways to save. The cost of labor is one place they are looking to cut.

Workers and labor watchers say on-call shifts are on the rise, but the exact number is uncertain. The Bureau of Labor statistics has not looked at the issue since 2005, when 2.5 million workers held on-call jobs.

Ellen Davis, vice president of the National Retail Federation, is reluctant to call it a trend. Davis said the federation has no policy papers on the issue and that it hasn't come up in meetings. "It's not common enough that it has risen onto the radar," she said.

At the Club Monaco store in New York where Caprice Taylor worked, a manager who declined to give her name said the store uses call-in shifts "depending on the needs of the store." She declined to comment further. Calls to Club Monaco's corporate office were not returned.

Hard on workers, call-in shifts a boon for business

Call-in shifts may cause instability for workers, but experts say they allow businesses to staff up when they are busy and staff down when business is slow.

Lisa Disselkamp, a private workforce management consultant in Richmond, Va., said modern scheduling systems can be linked to sales data, which gives managers the ability to fine-tune an optimum balance between customers and staffing. In the past, Disselkamp said, scheduling was done on paper, and managers allocated employee hours based on intuition and projected sales trends. "Payroll for a long time was just processing time sheets," Disselkamp said. "Today these systems are very intelligent."

Increasingly, managers begin their shifts by logging on to scheduling systems, or looking at messages the systems send to their smartphones, Disselkamp said. The most basic systems help managers determine if the current workload calls for additional or fewer workers. More advanced systems look at individual employee skills, cost, and availability, and determine the best choice to fill slots, sometimes only an hour or two before the workers are expected to arrive.

Disselkamp compared the rise of smart scheduling to the lean inventory trend in manufacturing, in which factories rely on regular delivery of materials from suppliers rather than filling large warehouses with supplies. Lean inventory allows manufacturers to cut costs by transferring financial risk onto suppliers. In lean scheduling, Disselkamp said, risk is transferred to the worker. "The employee takes the job without a committed schedule of hours. That's where the risk is," she said.

There are no laws that require employers to provide a minimum number of hours. However, Disselkamp said lean scheduling can backfire on employers if taken to extremes, because turnover will rise, adding to training costs.

Call-in shifts not just for high school students

In 2011, the department store Macy's phased out call-in shifts. Instead, it began advertising for "flex team" jobs, which allow employees to log on to the scheduling system and choose available shifts, after full-time and part-time employees are scheduled. Beth Charlton, a Macy's spokeswoman, said the move "works to the advantage of most associates. They are students, moms, and people who want to work part time. It accommodates their schedules." If a student has exams, for example, Charlton said, a job on the team allows the flexibility to take a week off to study by simply not signing up to work shifts. However Charlton said flex team workers are not guaranteed a minimum number of hours.

In 2011, the Retail, Wholesale and Department Store Union negotiated a five-year contract with Macy's on behalf of 4,000 workers at four stores in the New York City area. Union spokesman Dan Morris said Macy's new scheduling system was an area of contention during the negotiations. As part of the contract, full- and part-time workers retained their status and their hours. The contract does not cover the flex team.

On-call schedules can benefit some students and other flexible workers, but experts say it's outdated to think the majority of part time workers are people looking for extra spending money. H. Luke Shaefer, a professor of social work at the University of Michigan, said the long stretch of high unemployment led employees to take jobs they might not have considered in the past. Shaefer said in 2009, the last year the data is available, 45 percent of part-time workers were primary wage earners in their families.

But even for workers who provide only part of family's income, on-call shifts can be a struggle. In 2011, 25-year-old Sheena Dixon found a job working a call-in shift at Levi's in Manhattan. Dixon, who lives in the Bronx with her mother, a nursing assistant, contributed rent and grocery money and bought clothes for her sister, a high school student. At Levi's, Dixon said she made $9.25 an hour, but often worked between four and 12 hours a week. She didn't stay long.

"For me to do all of that just to get paid what I used to get paid when I was 14, that didn't work for me at all," she said. Asked what she plans to do next, Dixon said she is looking for a new retail job.

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