Report — From the March 2015 issue

The Spy Who Fired Me

The human costs of workplace monitoring

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A 2010 management survey led by Susan Lambert of the University of Chicago found that 62 percent of retail jobs are now part-time and that two thirds of retail managers prefer to maintain a large workforce, to maximize scheduling flexibility, rather than increase hours for individual workers. In 2012, a study of retail workers conducted by the Retail Action Project and Stephanie Luce of the City University of New York found that unstable scheduling, with radical changes from week to week, was common, as was extremely short notice. Only 17 percent of surveyed workers — and just 10 percent of those who were part-time — had a set schedule; only 30 percent received their schedule more than a week in advance. Schedules often had set start times, but many shifts ended abruptly as soon as business declined. One in five workers had to keep her schedule free for “call-in” shifts that rarely materialized. An employee at Club Monaco told researchers that if sales weren’t high enough, managers would give workers a single guaranteed shift each week — plus four on-call shifts. A third of the employees in the study had dependent children and were forced, like Santana, to piece together child care to cover their increasingly erratic working lives.

Most low-wage workers juggle two to three jobs just to get by, said Allen Mayne, director of collective bargaining at R.W.D.S.U., a retail workers’ union that helped found the Retail Action Project. But it’s almost impossible to get a second job if you’ve already promised away a claim on each of your waking hours. I asked Mayne whether an employee could get fired for missing a shift that she was given at the last minute. “In a nonunion environment?” he said. “Oh, yeah. Fine. See you.”

Labor costs have long been a pressure point in retail, but the impact of data-driven software systems is dramatic. In August 2013, less than two weeks after the teen-fashion chain Forever 21 began using Kronos, hundreds of full-time workers were notified that they’d be switched to part-time and that their health benefits would be terminated. Something similar happened last year at Century 21, the high-fashion retailer in New York to which people make pilgrimages for discount Versace, Kate Spade, and Burberry. I spoke with two saleswomen who had worked at the flagship store near the World Trade Center for a combined forty-four years. They said they had always had consistent and full-time schedules until the chain expanded and implemented a Kronos system. Within the space of a day, Colleen Gibson’s regular schedule went up in smoke. She’d been selling watches from seven in the morning to three-thirty in the afternoon to accommodate evening classes, but when that availability was punched in to Kronos, the system no longer recognized her as full-time. Now she was getting no more than twenty-five hours a week, and her shifts were erratic. “They said if you want full hours, you have to say you’re flexible,” she told me.

Larry Mentzer, Century 21’s chief revenue officer, said such problems were rare. “We’re a big believer in the Kronos electronic scheduling system,” he told me. “We had a few small glitches when we rolled it out, and by a few I mean you could count them on your two hands. But we fixed it and we’re very happy with it.” Max Bruny, president of U.F.C.W. Local 888, which represents Century 21 workers, told me the problems were more widespread: “With Kronos, they organize it in terms of buckets. They ask for your availability. Say you have one hundred percent availability, they put you in the bucket of thirty-five to forty hours. If you say you can’t work weekends, you’re put in another bucket, where you get maybe twenty-five to thirty hours. And that was the nightmare. So people who used to get forty hours — because you have restrictions, now you’re not.” Bruny’s union filed several grievances in the first year Kronos was implemented and even filed charges with the National Labor Relations Board. Under pressure from the union, Gibson’s manager overrode the Kronos scheduler and gave her back her old hours, and the union ultimately won the right to a fixed forty-hour schedule for anyone with at least ten years’ seniority. But most shops where Kronos has been implemented — including Starbucks and the Gap — are not unionized, which makes it far more difficult for employees to push back. “We took a different path from other stores,” Mentzer said, “because we chose to retain our workforce.”

Lisa Disselkamp, a consultant with Deloitte, is the author of three manuals on workforce-management technology. “I think it’s natural that it will start to change behaviors,” she said of the scheduling software. “It focuses people on a metric. And there’s a fear, right? I need to make that number. But if you meet that number, and only that number, what does it cost?”

Kronos’s promotional videos emphasize the risk of time theft by employees — “In a few minutes late? Taking a few extra minutes on a break? It adds up” — and some of the firm’s most invasive systems, which require employees to clock in with a finger scan, are meant to prevent “buddy punching,” when an employee clocks in a co-worker who hasn’t yet arrived.

John Durkalski, an attorney who has represented union workers with wage and schedule complaints against Kroger, Safeway, and Supervalu, said that time theft by employees is far less common than wage theft by employers. “Store managers change time sheets, lop off overtime, tell people to clock out and keep working, and fine, if you don’t, you’ll be on the manager’s bad side,” he told me. If the software subtracts thirty minutes for an unpaid meal break regardless of whether a worker took one or not, or fails to properly account for paid sick leave, it can be extremely difficult for an employee to detect. The scheduling systems also increase the pressure on supervisors to break the rules, Durkalski said. “That pressure is that buzzer that goes, ‘Ding, ding, ding, ding, ding, you’ve hit your costs!’ If you hit your costs on the twenty-first day of the month and you’ve got nine days left, what are you going to do? The pressure is to cook the books or get the employees to work off the clock.” In industries where workers typically work three- or four-hour shifts, he said, “if you can get everyone to work fifteen minutes off the clock, you’re gaining almost a whole shift! Over the course of the week that will really keep costs down.”

Last March, workers filed class-action lawsuits against McDonald’s stores in California, Michigan, and New York, alleging systematic wage theft. Some of the practices listed in the legal complaints are closely linked to the stores’ in-house data-collection systems. The software itself was not telling managers to violate the law, said David Dean, the lead attorney in the Michigan suit. But every fifteen minutes, the software calculates labor costs as a percentage of revenue — the “labor number” — and reports whether you’re under or over your target. “The violations result from managers being told, ‘You have to get your labor costs under control: you’re over, you’re over,’ ” he said. “The problem is, if they send somebody home and business picks up in a half hour, they’re screwed.” According to the plaintiffs, McDonald’s managers would routinely tell employees to clock out and wait in the break room for minutes or hours without pay, until revenue picked up enough for the workers to clock back in. Or managers would tell employees to clock out before the end of their shifts but insist they finish certain tasks before going home. (A company spokesperson told me, “When McDonald’s learns of pay concerns in restaurants which we own and operate, we review the concerns and take appropriate action to resolve them. . . . [W]e caution against drawing broad conclusions based on a small number of lawsuits.”)

Though the plaintiffs in the McDonald’s cases are not talking to the press, Larika Harris, a McDonald’s employee who lives in Memphis, Tennessee, described a similar work experience. Harris was typically assigned to the overnight shift, when there’s just one person at the window and one person on the grill. “We couldn’t take breaks,” she said, not even to run to the bathroom, “but the breaks got put in.” She was often paid only for her official eight-hour shift, even when her supervisor didn’t let her leave on time. If she was scheduled for seven in the evening to three in the morning, she was rarely out of the door till three-thirty; on her eight-to-four overnight shifts, she was usually not allowed to leave until five-thirty. One paycheck, she said, was missing eleven hours of compensation. With an infant and a toddler at home, she had to pay her babysitter for those extra hours even though McDonald’s wasn’t paying her.

“You’re told to ‘manage the labor,’ ” said Kwanza Brooks, a former shift manager who worked at several McDonald’s restaurants in Baltimore and in Charlotte, North Carolina, over twelve years. “Your labor, that’s what McDonald’s calls it, is your main focus.” Managers are supposed to give out unpaid thirty-minute breaks, Brooks said, but the staffing is too lean to make that possible. After she’d been at McDonald’s about five years, an assistant manager showed Brooks how he fixed that problem. He noticed that her labor number for one shift was high, 23 or 24, rather than 17 or 18. So he said to go in and manually add in breaks, and showed her how to scroll down the list of employees and add “break in” and “break out” times for each one. When one employee challenged the practice and started asking for a printout of her hours at the end of each shift, Brooks was instructed not to release any more printouts.

I asked Brooks about other methods managers used to hit their numbers. “Say you’re supposed to come in at four o’clock and you get there early. They might tell you to help but not clock in. Or they might clock you out on a break but keep you working. Or they might say, ‘I’ll send you home,’ and then there’s a rush, and they’re going to make sure you help get those customers out whether you are on the clock or not.” Managers, she said, “might have half the people working for free.” They don’t just want a low labor number, she said, “they want their number to be the lowest and best in their area.” A 2014 survey of fast-food workers by Hart Research found that 89 percent said they had been victims of some form of wage theft.

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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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