A Changing Labor Environment, are you ready?

Written by Rachael Skinner

April 20, 2016

The perfect mix of staffing and costs is an ongoing battle for any franchisee enterprise owner. The balancing act between exceptional customer service and labor costs occupy the waking hours of many business owners. And recently, new governmental labor policies and legislation, and labor advocacy groups, are raising the level of difficulty even higher.

Did you know that the United States Department of Labor has proposed to raise the threshold for overtime exception from $455 a week (equivalent $23,660 a year) to about $970 a week ($50,440 a year) in 2016?

Are your scheduling and wages procedures agile enough to survive if this motion passes?

How about the recent introduction of National Labor Relations Board (NRLB) advocacy groups?  These groups are out to make their presence felt by franchise enterprise owners across the country. Are you confident that your franchise’s labor practices will pass scrutiny from these groups? How would you prove you’re doing the right thing by your employees? At the 2016 Multi-Unit Franchise Conference in Las Vegas this year you might want to check out the session moderated by Robert Branca from Branded Management Group who will lead a group of industry labor experts in a panel discussion.

If these two developments weren’t enough, new minimum wage legislation has become law. On April 4, California Governor Brown signed Senate Bill 3 into law. The new law increases the minimum wage to $15 per hour by 2022, for employers with 26 or more employees.

Although seemingly overwhelming, you can succeed in this ever changing labor environment. Speaking as Adi Insights founder and CEO, from day one we have instilled in our employees and customers the belief that effective staff scheduling results in higher productivity, happier staff, less scrutiny from advocacy groups, delighted customers and ultimately, an improved bottom line – even in these difficult times.

New staff scheduling technology can help you address all of these challenges and achieve the ideal balance between delivering an exceptional customer experience and consistently hitting your labor cost targets.

I have personally experienced labor reform before. Australia underwent a massive labor reform across 2009 – 2014. This motivated the development of our software; to help businesses retain trained staff while staying profitable.

Business owners in the Australian restaurant industry have already experienced mandatory wage increases. Minimum wage in Australia is AU$17.29 and most salary workers in the industry earn an average salary of AU$52,813 per year.

With the right technology, Australian businesses are still thriving. Changing labor conditions can be good for everyone including staff, their families and businesses, but it does require a change in business behaviors and processes.

American businesses that see this and act now, will be the ones that come through

these challenges stronger and healthier.

Adjusting Behaviors

As an employer, your objective is two-fold – to maintain a profitable and successful business, and offer security for your employees and their families. When staff feel secure, they feel valued, they contribute more to your business, and more money flows to your business from satisfied customers. This means more money is generated in the wider economy which is good for everyone.

When businesses randomly assign shifts without the right tools, staff struggle financially.  Staff often do not receive the regular hours required to support their living needs and this ultimately negatively affects the business. The difference Adi Insights staff scheduling software offers is the ability to quickly determine optimal labor staffing levels for managers while providing a solid predictable work routine for staff that is optimal for both.

Better information results in better decisions.  Managers using Adi Insights easily produce smart costed schedules that indicate when and where to allocate staff based on customer demand. This gives you the staff you need at the right times without the waste that comes from less precise tools. No longer do managers have to cut staff numbers to hit their labor KPIs (a critical issue as minimum wages rise) and later have to deal with rehiring challenges.

Being Proactive

A proactive approach to staff scheduling increases revenue, improves customer satisfaction, and enables your business to pay higher minimum wages while still running a profitable business. Adi Insights enables your business to meet multiple labor targets while balancing staff’s personal needs.

Taking a proactive approach to these incoming labor changes could save your business. It will place you in a position to thrive in the ever-changing labor environment – no matter which way it moves next.

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