Report — From the March 2015 issue

The Spy Who Fired Me

The human costs of workplace monitoring

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Whenever you drive up to a McDonald’s window, or push your grocery cart to a Stop & Shop checkout line, or head to the register at Uniqlo with a blue lambswool sweater in hand, you, too, are about to be swept up into a detailed system of metrics. A point-of-sale (P.O.S.) system connected to the cash register captures the length of time between the end of the last customer’s transaction and the beginning of yours, how quickly the cashier rings up your order, and whether she has sold you on the new Jalapeño Double. It records how quickly a cashier scans each carton of milk and box of cereal, how many times she has to rescan an item, and how long it takes her to initiate the next sale. This data is being tracked at the employee level: some chains even post scan rates like scorecards in the break room; others have a cap on how many mistakes an employee can make before he or she is put on probation.

Until recently, most retail and fast-food schedules were handmade by managers who were familiar with the strengths of their staff and their scheduling needs. Now an algorithm takes the P.O.S. data and spits out schedules that are typically programmed to fit store traffic, not employees’ lives. Scheduling software systems, some built in-house, some by third-party firms, analyze historical data (how many sales there were on this day last year, how rain or a Yankees game affects revenue) as well as moment-by-moment updates on the number of customers in the store or the number of sweaters sold in the past hour or the pay rate of each employee on the clock — what Kronos, one of the leading suppliers of these systems, calls “oceans of valuable workforce data.” In the world of retail, all of this information points toward one killer K.P.I.: labor cost as a percentage of revenue.

In postwar America, many retailers sought to increase profits by maximizing sales, a strategy that pushed stores to overstaff so that every customer received assistance, and by offering generous bonuses to star salespeople with strong customer relationships. Now the trend is to keep staffing as lean as possible, to treat employees as temporary and replaceable, and to schedule them exactly and only when needed. Charles DeWitt, a vice president at Kronos, calls it “the era of cost.”

Workforce-management technologies make productivity visible and measurable, allowing employers to distinguish between labor time that generates profits and labor time — down to the minute — that does not. Kronos systems promise to “optimize the workforce” to deliver “the lowest cost schedule.” The system doesn’t necessarily lead to clients cutting employees’ hours, DeWitt told me. “If they don’t have these tools, they’ll understaff, which will lead to customer dissatisfaction. It only takes two to three bad experiences for a customer to leave a brand forever.” But he said that overstaffing can be a bigger problem: “If you have chronic overstaffing, you’re just not going to be competitive and you’ll drive yourself out of business.” A large company can easily pay $1 million a year for a third-party service. Kronos, whose client roster includes retail giants such as Starbucks, Stop & Shop, and Payless, brought in $1 billion last year. Occasionally such software systems are customized: at Macy’s it is My Schedule Plus; at McDonald’s it is called R2D2.

Carrie Gleason, a former union organizer who now runs a national campaign called the Fair Workweek Initiative, recalled that back in 2005, when she first began organizing retail workers, employees at stores like JCPenney were still mostly full-time, and many had health insurance. “Over the years I heard more and more workers talk about how they weren’t getting enough hours,” she said, “and how their managers ignored their availability.” The news filtered in from the retail workers she spoke with: the Gap was scheduling four-hour shifts; DSW salespeople were getting only twelve hours of work a week; at some stores Zara was changing employees’ schedules without notice, leading many to snap photos of posted schedules to avoid getting disciplined for missing a shift they weren’t aware they had; Abercrombie & Fitch employees started receiving entire schedules composed of on-call shifts that never materialized. Facebook pages began to crop up for workers desperate to pick up extra hours — or to get someone to cover a shift they’d been saddled with on little or no notice. Employees were slowly being turned into day laborers. The federal Bureau of Labor Statistics has reported that the number of retail employees involuntarily working part-time more than doubled between 2006 and 2010, from 644,000 to 1.6 million.

The experience of Allison Santana, a mother of four in Chester, Pennsylvania, illustrates the new normal. She was hired as a Starbucks barista two years ago. The starting wage was low — $7.60 an hour — but she thought she could scrape by with the twenty-eight to thirty-eight hours a week she was promised. She got far fewer, however, usually eighteen hours, made up entirely of four- or five-hour shifts. “Instead of having four people work seven a.m. to three p.m., like at a regular job, it would be me and someone else opening the store at four a.m., then at six another person, then maybe at seven-thirty another person comes in. And most of them wouldn’t stay till three,” she said. “It’s cutting that labor, saving that labor, that’s the whole deal of the software.”

Santana supplemented her Starbucks earnings by working nights at a hotel. Her manager knew about the job, but that didn’t stop the software from spitting out shifts that started while she was still at the hotel. She used state-subsidized day care for her children, but the facility required her to specify her schedule in advance, and Starbucks rarely gave her enough notice to do so. Plus the day care was only open Monday to Friday, and Starbucks mostly gave her weekend hours. She lost her spot at the facility and ended up leaving her kids with her mom, who was juggling three young children of her own. Santana’s child-care troubles were not considered an acceptable excuse for missing a shift. Her manager wouldn’t even excuse co-workers who missed work for a child’s graduation or a loss in the family. In exchange for twenty hours of low-wage work each week, staffers gave up control over their lives. (Last August, in the wake of a New York Times exposé, Starbucks announced a new policy that will give employees a week’s notice of their schedules; meanwhile, Santana has been promoted and her hours have stabilized. A spokesperson said that company policy allows up to four days of bereavement leave and that store managers “work hard to give partners the hours they want.”)

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is the editor of the Investigative Fund at the Nation Institute and was a 2013–2014 Alicia Patterson Fellow.

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