There is a rising tide of “fair workweek” legislation across the states, which some are categorizing under the title, “predictive scheduling.” These laws are designed to prevent unpredictable and irregular work schedules by larger (and often multi-location) employers, something generally most common in the restaurant and retail industries, and thereby impacting a large number of franchise owners.
Employers and franchise owners who do business in San Francisco, New York City, Philadelphia, Seattle, and Oregon are already feeling the heat. Some of these locations have laws already in place, or soon to be in place. For example, Philadelphia’s Fair Workweek Employment Standards Ordinance will become effective January 1, 2020. Massachusetts, along with the City of Boston itself, is considering quickly catching up. In Massachusetts, Senate Bill No. 1110, “An Act Relative to the Scheduling of Employees”, was introduced to provided standard fair workweek protections for Massachusetts workers in retail establishments, restaurants, and the hospitality industry. The benefits to employees afforded under the new legislation include providing workers with a 14 day advance notice of their schedules, the right to rest between shifts, and additional protections against retaliation. Similarly, Senate Bill No. 1102 in Massachusetts, also titled “An Act Relative to the Scheduling of Employees”, is a more sweeping and less defined legislation that requires employers to post a 7 day schedule in writing at least 7 days prior to the first day of that work schedule.
The Massachusetts legislature held a hearing regarding the proposed legislation on April 9, 2019. At the hearing, several representatives of the potentially impacted employers argued that the proposed legislation’s “one size fits all” approach unreasonably restricts an employer’s ability to adjust to unforeseen circumstances. Moreover, the costs associated with proposed legislation compounds the leave laws already enacted by the Commonwealth. Opponents also argued that the proposed legislation amounts to overreach on the part of the Commonwealth since it seeks to unfairly control employers’ day-to-day operations for selected industries. Along similar lines, At-Large Councilor Michelle Wu recently introduced an “Ordinance Regarding Fair Workweek Employment Standards for the City of Boston” at a Boston City Council meeting in October 2018. The ordinance, if passed, will require all City contractors to give their employees 14 days advance notice of their schedules and offer new shifts to current employees first.
This said, it is important to highlight that this tide is not rising everywhere. Several states, including Arkansas, Georgia, Iowa, Michigan, Missouri, Ohio, and Tennessee have enacted laws preventing municipalities from enacting so-called “fair workweek” laws.
What Does A “Fair Workweek” Law Look To Do?
There are some common requirements among the various states and localities when they enact (or look to enact) fair workweek laws. Most have the following elements in common:
- Requiring employers to provide their employees with advance written notice of their work schedules, usually at least 14 days in advance.
- Requiring employers to provide employees with a good faith written estimate of their work schedule on or before their start date.
- Requiring employers to permit employees to decline working altered shifts/schedules without retaliation if changes are made within the notice window and/or if employees receive premium pay for working the altered shifts (with typical exceptions such as if the employee is already being paid overtime for the time, or voluntary shift swaps).
- Requiring employers to offer current employees available shifts before hiring new employees.
- Notice and record keeping requirements, whereby employers must post a notice of their employees’ rights, and keep records sufficient to audit compliance with the applicable fair workweek law.
Why Has The Law Evolved In This Way?
Supporters of fair workweek laws tend to argue that these protections are necessary to assist employees in having a more predictive level of income and pursuing personal activities, like attending school. Supporters also argue that theses laws are aimed at creating a better work-life balance by helping workers better handle family obligations, such as childcare. Of course, these laws also protect employees from perceived abusive scheduling practices by employers, such as short notice when there could have been longer notice, or overt or subtle retaliation for turning down sudden scheduling changes.
That said, “predictive scheduling” legislation has substantial opposition from business owners who typically try to act with the best of intentions, have to deal with last minute “no shows,” and often “no-calls”. Business owners who constantly strive to control and minimize labor costs, while still serving the demand of customers they typically have are understandably frustrated by the constraints imposed upon them by fair workweek laws.
Let’s Look At New York City’s Fair Workweek Law As An Example
New York City’s Fair Workweek Law (N.Y.C. Admin. Code § 20-1201 et seq.) presents as a worthwhile example. It established different obligations on the part of retail and fast food employers. Covered employers include: (1) fast food establishments that are part of a chain that have 30 or more locations nationally; and (2) retail businesses that have 20 or more employees in the city and are engaged primarily in the selling of consumer goods.
While under the law, both types of employers must provide employees with predictable work schedules, fast food employers must provide their employees with a written good faith estimate of the total number of hours, times, locations, and days an employee can expect to work each week, and do so no later than when the employee receives his/her first work schedule. Fast food employers are also required to provide an updated good faith estimate if there are any long-term or indefinite changes to the employee’s schedule. On or before the employee’s first day or work, a fast food employer must provide a written schedule to the employee containing regular shifts and on-call shifts. All subsequent work schedules are to be provided to the fast food employee no later than 14 days before the first day of the new schedule. Then, if changes are made to a fast food worker’s schedule with less than 14 days notice, employers are required to pay penalties, ranging from $10 to $75 for each change. Moreover, fast food employees who work a back-to-back closing and opening shift must first provide written consent to do so, and if they do so, they are entitled to an additional $100 premium pay. Existing fast food employees must also be offered the opportunity to work open shifts before the employer can hire new employees.
Slightly different, retail employers in New York City must provide more than 3 days of advance notice of employees’ work schedule. Then, retail employers are prohibited from canceling a shift within 72 hours, and also prohibited from calling employees into a shift less than 72 hours from the start of the shift, unless the worker consents in writing.
New York City’s fair workweek law (as well as other locations, such as San Francisco) are particularly troubling for employers because of its expansive definition of a “covered employer.” The definition covers temporary staffing agencies and subcontractors, including employers providing janitorial and security services. In other words, the general perception that the law is limited to retail and fast food employers is not the end of the inquiry. If an agency stocks supplies, cleans or provides security for retail or fast food businesses, their employees are protected by the law (and the agency is a covered employer) as well.
What Are Franchise Owners And Employers Doing About It?
Franchise owners and employers are taking proactive action where they can. As an example, the International Franchise Association (“IFA”) along with the New York Restaurant Association and the National Restaurant Association recently mounted a legal challenge to New York City’s Fair Workweek Law arguing, among other things, that the law is preempted by state labor laws. (see Int’l Franchise Ass’n v. City of New York, 2018 WL 6521558 (Sup. Ct. N.Y. Cty. Dec. 3, 2018) (complaint)). The IFA also argues that the law unfairly targets franchise owners, resulting in an unfair advantage to small “mom and pop” businesses who are less likely to need to comply with the law. This case should be tracked and watched for its outcome, as the way it is reviewed and decided will be persuasive in other locations as well.
What Can I Do?
As with any employment law, employers in impacted locations need to first assess if they are covered and thereby required to comply. Next, if compliance is required, employers in such locations need to read, understand, and actually comply with the law. Some employers may be required to do so in multiple states. As compliance is evaluated, and nuances about local laws raise questions, keeping an eye on court actions and rulings, as well as any agency opinion letters that interpret the law will be paramount.