Shiftless in Seattle: Lawmakers Pass Onerous New Scheduling Ordinance

The Seattle City Council last Monday passed a sweeping “secure scheduling” ordinance by a unanimous vote, making it only the second city in the nation to take a direct role in regulating how businesses set employee schedules.

Under the new ordinance—effective July 1, 2017—certain employers will be required to tell their workers two weeks in advance which shifts they will be working.

Should an employee be called in for extra hours, say, to replace a sick co-worker, the employer will have to pay him added “predictability pay.” Should an employee be sent home early—maybe because business is slow or a delivery is late—the employer must compensate him for half the hours he was scheduled to work.

In addition, on-call staff will earn half pay for shifts when they are not called into work, while those employees that have less than 10 hours between two shifts will receive time and a half. Managers will also be required to offer any additional hours to current employees before taking on new hires.

The stated purpose of the ordinance—aside from creating more predictable schedules—is to provide employees with “secure incomes” by ensuring them adequate hours.

Not getting as much work as they would like is a source of frustration for many Seattle workers. In a recent study commissioned by the city, some 30 percent of workers reported wanting more hours, and 10 percent reported difficulty in paying bills due to a lack of hours.

Helping eager employees work more and earn more is a laudable goal for the Seattle City Council. It is also a bizarre one, given how many disincentives it has created to businesses giving employees extra hours.

In 2012 Seattle passed a bill requiring businesses to provide one hour of sick leave for every 40 hours an employee works, raising the hourly cost of each worker. Then in 2015, the city passed its notorious $15-an-hour minimum wage law, raising that hourly cost still further. Indeed, a July study put out by the University of Washington (UW) found that the mandated wage increase has led to fewer hours worked per-employee and slightly less overall employment for Seattle’s lowest-paid workers, compared to similar earners in other parts of the state.

The Affordable Care Act (ACA) also bears some of the blame for the lack of hours, says John Vigdora, the UW economist who authored the July study on the city’s new wage floor. Many employees have found their hours cut by employers looking to avoid the employer-provided-insurance mandate in the ACA, which kicks in only when someone works hours over a certain threshold, he explains.

Whether the new scheduling regulation will help workers get these hours back remains an open question, and Vigdor speculates that employers that are particularly concerned with their level of customer service may choose to absorb the costs of the new law, maintaining current staffing levels. Businesses in a more precarious financial situation, on the other hand, or less reliant on offering good customer service, are likely to respond by cutting hours.

In San Francisco—the only other city to adopt secure scheduling legislation—many businesses have indeed cut back on staff. A study conducted six months after the law went into effect found that “in response to the ordinance, 1 in 5 surveyed businesses had cut back on the number of part-time hires, and a similar number were scheduling fewer employees per shift,” according to the San Francisco Chronicle.

Reason queried each member of the Seattle City Council on whether they thought Seattle businesses might behave similiarly. Tim Burgess and Mike O’Brian declined to comment; the rest did not respond to multiple requests for comment.