Reducing Employee Turnover

A case study

Problem

This food processing company was experiencing severe problems with employee turnover. The underlying cause of this turnover problem was excessive overtime.

Located in a small town with several other labor-intensive companies, the company constantly competes for labor, often operating with less than a full complement of personnel. This staffing shortfall was resulting in substantial overtime which, in turn, created an even higher turnover. Overtime policies allowed senior employees to accept or decline overtime work as they saw fit. When the senior employees chose not to work overtime, the newer employees were forced to work tremendous amounts of overtime, especially during the undesirable periods (i.e. on weekends). The high overtime levels meant that new hires frequently worked long stretches of days in a row causing them to seek greener pastures.

Action

Employee preferences: Employees wanted predictability, a choice in the type of schedule they worked, and reasonable time off to spend with their families.

Business requirements: A business analysis indicated that considerable productivity improvement would be realized if most of the operation changed from a combination of high production on weekdays and limited production on weekends to moderate, steady production seven days a week.

Implementation: In the end, two schedules were implemented. One schedule was a traditional 5-day schedule using 8-hour shifts. The second schedule, used by half of the operation, was a 7-day shift schedule using 12-hour shifts.

Employees on the 7-day schedule were protected from working a scheduled weekend off. They also received about 10% more income and 78 more days off than those on the 5-day schedule.

Interestingly, the company had no problem filling the employee positions on the 7-day schedule. The increased predictability, income and number of days off actually made the 7-day schedule more popular than the 5-day schedule.

Results

After six months on the new schedule, the workforce was surveyed to provide a “before and after” picture. Using indices to measure performance, the change is shown below:

  1. Communication: +5.5%
  2. Management’s openness to workforce input: +13.8%
  3. Employees feeling that they are a part of the company: +11.9%
  4. General quality of work environment: +21.1%
  5. Facility rating relative to other companies in the area: +21.2%
  6. Schedule predictability: +40.6%
  7. Schedule flexibility: +47.5%

These improvements in employee perception pertaining to the company and the work environment resulted in a greater than 50% reduction in turnover.

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Communicating Major Changes: how a production facility did it successfully

Jim Dillingham, Partner, Shiftwork Solutions LLC

When leaders initiate a major change that affects their employees, they want everything to proceed smoothly. They don’t want to alienate the workforce or create any long-lasting disruptions or unnecessary delays. Change that affects the personal lives of people is the most difficult and riskiest type of change. Yet that is exactly what leaders do when they modify or replace their employees’ work schedules.

The leader’s challenge is how to get their people to support the schedule change. Employees have diverse lifestyles, so you can expect their preferences for a new work schedule to be equally varied. A thing as simple as changing a shift start time can feel like a catastrophic event to an unprepared workforce. How will they get their kids to school? Their carpool won’t wait for them. They can’t take that night class they’ve been thinking about. People have a myriad of responsibilities, activities, and interests that will be affected by any change in their work schedules. Every possible conflict can be blown up into an unsolvable problem.

Here is what a semiconductor company did to successfully handle the challenge. The work site was a production facility with more than 1,200 employees. Before the change, the shift schedule had relied on “weekend warriors” to handle the weekend shifts. Full-time employees had covered Monday through Friday. The weekends had been covered by two additional crews that only worked for the company on the weekends. One of the crews worked 12-hour day shifts on Saturday and Sunday. The other crew worked 12-hour night shifts on those same days. In some instances, these weekend workers also worked during the week to add to their income.

As you might expect, this was causing several problems:

  • The weekend crews experienced a high attrition rate and high absenteeism.
  • Finding replacements for the vacant weekend positions was an on-going concern.
  • Maintaining team integrity was difficult because the weekday shifts had many weekend employees who were not part of the core crew/team.
  • Using weekend warriors required five crews instead of four crews, the common approach for a business that operates 24/7. This required 25% more personnel, and thus a 25% increase in the number of employees to communicate with.
  • Productivity would drop when the weekend crew took over as the weekenders familiarized themselves with the production changes that took place during the five days they were away. This also happened to the full-time employees after being away for two days but to a lesser extent.

The management team decided to replace the old work schedule with a “compressed work week” schedule that would require employees to work twelve hours per shift instead of eight hours but reduce the number of shifts worked each week. It would also eliminate the need for weekend warriors.

On the new schedule, employees would have seventy-eight fewer workdays and ten percent more income. One might think that these two figures would be reason enough to support a schedule change. The fact is that a workforce, uninformed about what is about to happen, will choose to remain on the current schedule for no reason other than they are familiar with it.

To gain support for changing the shift schedules, the company knew they would have to find a way to involve the workforce in the change process. To do this they did three things:

  1. They increased communications regarding the current situation and explained why a change was needed. They educated people about the problems the weekend warrior approach was creating. Managers held large group meetings, posted announcements, and sent e-mails to make sure the workers completely understood the reasons a change was needed. The goal was to have the workforce join together in support of the common cause. A key component of this effort was the company’s supervisors since communication between hourly workers and the first level of management is usually the most influential. Supervisors were first educated about the need for change. Then they were used to help pass that message along to their direct reports. This had the effect of empowering supervision while giving employees ready access to someone who could answer their questions.
  2. They brought in a neutral, third party to facilitate the change process. They felt the shift workers would trust the process more if it was run by someone who was not affiliated with the company. They did not want the change in shift schedules to come across as a management ultimatum. They hired us to present an impartial view of how to solve the current situation. We explained the steps that would be taken, including how the employees’ input would be used. Not everything was up to the workforce to decide. For example, the decision had already been made to get rid of the weekend warrior schedule. But the employees could play a major role in deciding what to replace it with. Our role also included responsibility for expanding everyone’s awareness of what was possible. Most shiftwork managers and employees have limited exposure to different schedules. This makes their “box” of options appear much smaller than it actually is. A critical feature of the facilitator’s work is that it must be transparent. This means no secrets. All work performed by the third party must be accessible by everyone. All analyses and all survey results presented to management must also be made available to the workforce. This was accomplished by giving the employees a shortened version of any results and letting them know where more detailed information could be viewed if they wished to do so.
  3. They involved employees in selecting the new work schedules. This began with a Lifestyle Survey that was given to all affected employees. The survey allowed employees to give their initial feedback about the pending change. It also allowed them to express preferences with regards to shift work in general. Several weeks later, the employees were given the results from the survey. This validation of results allowed employees to see that their input was actually heard. A second survey was prepared for the workforce that offered a number of alternative schedule solutions. These schedule alternatives were developed from an analysis of the business needs and coverage requirements as well as employee schedule preferences identified in the first survey. The employees were given a clear picture of the need to change. They also were educated about the different shift schedules that would work for their facility: what types were available and what people tend to find attractive (or unattractive) about different schedules. The survey allowed people to evaluate this set of schedule options. The results of the second survey were shared with managers and workers. The results were used to narrow down the schedule options to two 12-hour schedules. Every employee understood that their input was used to help identify the final options.  

The Results

The final two shift schedule options were presented to the workforce. Over 75 percent of the night-shift employees and over 95 percent of the day-shift employees agreed on what the new schedule should be. This strong consensus is directly attributed to the leaders’ efforts to communicate with their people and to actively solicit (and use) their input.

Even employees who did not initially agree with the need to change schedules eventually grew to understand and support the initiative. Employees who did not get their first choice of shift schedule or shift assignment felt that the process was thorough and fair. This sense of fairness allowed them to accept the change even though they wanted to keep their old schedule or change to something different.

If you are planning to make a major change in your business, keep these three concepts in mind. First, make sure everyone is well informed. People should have a solid understanding of the problem and its impact on the business. Second, build credibility at every step of the process. People must believe there really is a problem, the consequences are significant, and that management does not have a hidden agenda they are trying to sneak past the workers. Third and most importantly, involve the people affected by the change in selecting the best solution. Seek input from everyone, not just the most vocal people. It is especially important for employees to see that their input is used to influence the final outcome.

Communication, a clear process for selecting a solution, and employee participation are the three keys to success. This approach certainly worked well for this company. Hopefully, you will experience the same success by following these guidelines.

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Are Maintenance Workers Really Different than Other Shiftworkers?

By Bruce Oliver and Dan Capshaw, Shiftwork Solutions LLC

Many maintenance managers will tell you their workforce is different than other shift workers — that their attitudes and behaviors are not the same. Recognizing, understanding, and accounting for how maintenance personnel evaluates shift schedules are essential to finding a schedule that will satisfy their needs and give you the required coverage to meet your business needs.

When it comes to shift schedules, what makes maintenance workers unique? Using our database of over 20,000 employee surveys, we compared the responses of maintenance personnel with those of the average shift worker surveyed. The database includes information on the following topics:

  • Demographics
  • Health and alertness
  • Working conditions
  • Shift schedule features
  • Overtime

Let’s look at the maintenance worker results for each of these categories and compare them to the overall shift worker results. If our assumption that maintenance workers are different is true, we should see some differences in the results.

Demographics

Almost 98% of the maintenance workers are male. This is a sharp contrast with other shift workers, 76% of whom are male. The maintenance field is clearly dominated by men. A graphic comparison of the two groups is shown in Figure 1.

Maintenance workers have worked 43% longer in their current department than the average shift worker (8.6 years for maintenance vs. 6.0 years for the average shift worker). Unlike production workers who can quickly learn a new job in another department such as quality control or the warehouse, maintenance workers tend to stay in their specialized trade. They usually are paid more and spend more time working weekday day-shifts, which also may influence their reluctance to transfer to other departments.

This finding has two important implications for maintenance workers:

  1. Maintenance personnel expects to stay in their jobs, possibly for their entire careers. If they are required to work on a schedule they don’t like, they may see little opportunity to correct the schedule. This makes the stakes and consequently the emotions high when alternative schedules are considered. In fact, the shift schedule is so important that a substantial percentage of maintenance workers said they will quit their jobs before changing to a new shift schedule (24.7%).
  2. Since maintenance skills are often transferable to other companies, maintenance workers are able to change jobs to another maintenance job in a different company. Losing people because of your schedule is expensive. Of course, this also means that an attractive schedule can be a very effective tool for recruiting and retaining the best maintenance personnel.

Health and Alertness

The opinions and preferences of maintenance workers and other shift workers are aligned when it comes to health and alertness. They have similar sleep patterns and habits (e.g. alarm clock usage and their hours of sleep while working various shifts are almost identical), and their self-reported alertness is similar.

Working Conditions

Maintenance workers also gave similar responses to those of the average shift worker on all facets of the work environment except the need for training. As shown in Figure 2, more maintenance personnel feel their employer doesn’t train nearly enough (65.8% from maintenance vs. 55.3% of the average shift workers). Maintenance employees are well aware that training can make their jobs faster and easier. They also often believe that more training for employees in other parts of the organization will reduce the number of breakdowns.

Shift Schedule Features

There were only a few schedule features where maintenance workers’ preferences differed from the average shift worker. As shown in Figure 3, a larger percentage of maintenance people prefer fixed shifts (88.3% from maintenance vs. 82.9% among all shift workers). Most maintenance workers are assigned to weekday day-shift since most preventative maintenance work is done during this time. Minimal staffing is needed for corrective maintenance on nights and weekends. The likelihood of maintenance workers getting the shift they want is pretty high, so it is understandable that more of them want fixed shifts.

Maintenance personnel gave lower ratings to the importance of keeping their current crew members together (maintenance = 3.11 vs. average shift worker = 3.71 on a 5-point scale where 1 is lowest and 5 is the highest possible rating). Unlike other job functions that require extensive teamwork, maintenance work is given to individuals or small groups. Maintenance work often requires a high degree of independence, making the individual team member composition less important than the team skill composition is to the success of the organization.

Overtime

One interesting difference noted between maintenance personnel and the average shift workers is their preference for time-off instead of overtime. When asked, “If you had to choose between more time-off or more overtime, what would you choose?” 70% of the maintenance workers said “More time-off” in contrast with 61.4% of the average shift workers. This is shown in Figure 4.

Maintenance personnel are paid more than other shift workers, so they are not as dependent on overtime. In addition, maintenance workers work most of their overtime on weekends, since many companies push the maintenance work to the weekends. Since weekends are the most desirable time off, it is not surprising that maintenance personnel will choose to have more time off instead of more overtime. To them, asking if you want more overtime is like asking if you want fewer weekends off.

Conclusions

The survey results reveal only a few differences between maintenance workers and the general shiftwork population. The most significant difference is the lack of mobility within a company coupled with the high mobility to move outside the company. Shift schedules are always important to shift workers, but if the only apparent choice to improve a schedule is to change companies, the importance to maintenance personnel is even greater. The nature of the job attracts strong, independent personalities, so when emotions run strong, discussions can be intense. This passionate response to schedule changes explains why so many managers perceive maintenance workers to be significantly different than other shift workers – even though their overall schedule preferences are very similar.

Since maintenance work can occur anywhere in the facility, maintenance workers have many opportunities to come in contact with employees from other departments. That puts them in a perfect position to support communications along the grapevine. It is therefore incumbent on the entire management team not only to be aware of the maintenance team’s differences but also to understand their unique and valuable roles in the organization and use shift schedules that work well for their maintenance team while still meeting their business needs.

Call or text us today at (415) 858-8585 to discuss your operations and how we can help you solve your shift work problems. You can also complete our contact form and we will call you.

Considerations in Changing the Work Schedules of Non-Exempt Employees

by Bruce Oliver, Consultant, Shiftwork Solutions LLC (Republished with permission from the Society of Human Resource Management)

Organizations change the work schedules of their non-exempt employees for a variety of reasons:

  • Change the hours/days of operation to match the demand for their products or services.
  • Fix problems such as high absenteeism, hiring/retention issues, or excessive overtime.
  • Improve efficiency (e.g., lean manufacturing) or lower the operating costs.
  • Respond to employee requests for change or complaints about the current schedule.

Responsibility for gathering relevant information, identifying alternative schedule options, and implementing the new schedule is often given to the Human Resources (HR) manager. Since information on the subject is surprisingly scarce, this responsibility can be quite a challenge. It’s not something you do every day. Few people have the expertise to design a schedule for a group that works more than five days a week or more than one shift a day. Once you realize that schedule design is not the only step in changing schedules, nor the most difficult, you easily can be overwhelmed.

Despite the difficulty, this is a great opportunity for HR managers to orchestrate a significant change in the organization. As an HR manager, you are uniquely qualified to do this. You tend to have a broader perspective than line functions such as production or maintenance. You have more experience in communicating with employees. Your on-going role as a company steward has trained you to protect organizational interests while addressing employee concerns.

It is essential that you understand what is involved in changing work schedules. This paper provides a broad overview that will help you get started. Although every situation will have its own unique issues, as long as you address the following six considerations you will have a much better chance of reaching a successful outcome:

  • Change Process
  • Coverage requirements
  • Available resources
  • Schedule constraints
  • Employee preferences
  • Company policies

Change Process

In today’s tight labor market, organizations simply can’t afford to lose employees. Changing work schedules is an easy way to alienate the workforce and increase turnover. To ensure widespread support for the change, you need to have a plan for involving the key stakeholders and keeping them informed throughout the entire change process.

That sounds simple enough, but it’s actually the most difficult part of changing schedules. People are resistant to any kind of change. When it comes to work schedules, even a minor change can make a significant difference in employees’ lives. For example, changing the time that the work starts by 15 minutes may seem trivial, but it can have serious repercussions for people who commute in a carpool or use public transportation, parents with daycare requirements, and individuals with hundreds of other personal commitments built around their work schedules.

Key elements of the change process include:

• Prepare a clear business case. What are the reasons for the change? What are the consequences of not changing? Is the cost of changing less than the cost of not changing? A compelling justification can make a huge difference in garnering support.

• Identify key stakeholders. Who will be working on the new schedule? Who are the other interested parties? What types of concerns might they have? How might they benefit from a new schedule?

• Decide how to involve the stakeholders. How will the management team and the union be involved? How will employees participate? Which aspects of the new schedule are not open for debate? Should employees whose schedules may change at a later date be included at this time? Involving all key stakeholders whenever possible is critical to gaining widespread support for the change.

• Develop a communication plan. How will you explain the business case and its implications? How will you communicate progress: company-wide meetings, newsletters, bulletin boards, emails, the company web site, flyers, handouts, banners, crew meetings, or something else? Keeping employees updated throughout the process is essential.

• Announce the date of a schedule change. Will the change be made on a trial basis? If so, how long will it last? How will you decide whether to continue with the new schedule? When will other groups change? Establishing deadlines will demonstrate a commitment to change and alert employees who doubt that anything will happen.

Many larger organizations have found that the use of an outside facilitator is helpful in managing the change process. A neutral party helps to avoid the appearance that management is manipulating the workforce into doing something they don’t want to do. Finding an expert with broad experience in navigating the pitfalls associated with changing schedules will ensure a smooth implementation.

Coverage Requirements

How many employees do you need to show up at different times of the day? What skills do they need to have? Are these numbers the same all week? Answer this and you’ve defined your basic coverage requirements.

Determining the coverage requirements appears to be relatively straightforward for organizations with a workload that remains constant throughout the day and throughout the week. They need the same number of employees in each position to show up on every shift. In retail businesses, this is usually a function of the number of customer calls or visits. In service businesses, this is related to the number and types of service calls. In manufacturing, agriculture, construction, and mining, it may be related to the type of equipment, the number of machines, and/or the process followed.

Determining the coverage requirements for support organizations can be more difficult, however. If the business is changing from operating 5 days a week to 7 days, how does this affect the maintenance, warehousing and shipping groups? Do they need to work 7 days a week too? Each situation is different, so don’t overlook these other functions.

Organizations with variable workloads have a more challenging problem with their coverage requirements. Call centers, for example, may have a substantial increase in customer calls every evening. Retailers have more customer calls in the late afternoons, evenings and weekends. Manufacturers may have certain processes that run for only a few hours every day. These companies need to boost their coverage during the high workload periods to meet the demand.

Ideally, your schedule will match the number of employees with the workload throughout the day and throughout the week. You may be tempted to average the workload over an entire shift when it actually changes from hour to hour. Likewise, you may assume the workload stays the same each day of the week when it fluctuates from day to day. If the volume of work is excessive for just a few hours, employees and productivity/service levels will suffer. If the work volume is low, employees will be less productive or idle during this period of time. In either case, the business will incur unnecessary costs. Possible solutions include:

  • Schedules that have increased coverage on the busier shifts.
  • Schedules that have increased coverage on the busiest days of the week.
  • Different shift lengths to increase coverage when the shifts overlap.
  • Staggered shift start times to gradually change the coverage as each shift starts or ends.
  • Overlay shifts to add personnel during busy periods.

Available Resources

How many employees are needed to satisfy the coverage requirements? How many hours will they have to work each week? In addition to the base coverage, you need to consider absences such as vacations, illness, training, etc. Additional staff and / or overtime may be needed to cover these situations. Even though you think you have sufficient personnel, if a number of employees want to take a vacation at the same time, this could leave you short-handed. If someone takes a leave of absence due to health problems, pregnancy, or family care, you may not be able to replace them. The use of temporary employees may help, assuming you can find someone with the necessary skills.

Schedule Constraints

Schedule constraints include legal considerations (e.g., state laws requiring overtime to be paid after 8 hours of work) and union agreements (e.g., limits on the number of consecutive days worked). There are also company policies to consider. For example, your company may require that all employees rotate so they spend an equal amount of time on every shift.

These are referred to as “constraints” because they limit the number of possible schedules. If you need an 8-hour fixed shift schedule with a maximum of 5 days worked in a row, you’ll be hard-pressed to come up with a schedule that gives you a lot of weekends off or long breaks. Without the constraint on the number of consecutive days worked, you would have a lot more options to choose from. Without the fixed shift constraint, you would also have more choices. If there are too many constraints, it may be necessary to add more workers, increase overtime, or sacrifice some coverage.

Employee Preferences

There are several ways to identify the employee work schedule preferences. In smaller groups, it may be possible to simply show employees several different schedule options that satisfy the coverage requirements. This will generate a discussion of the good and bad aspects of each alternative, hopefully leading to an agreement on the “best” schedule for the group.

In larger organizations, gathering employee preferences is rarely this easy. Anonymous questionnaires may be required to ensure that everyone’s opinion is reflected, not just the more vocal employees. Multiple steps may be necessary to explain why the change is needed, ascertain general schedule preferences, identify and review possible options, and discuss the implications of each alternative. There are two things you should keep in mind when using this multi-step approach. First, avoid getting too specific early in the process. Second, take time to educate employees about new schedules.

If you initially ask employees what specific type of schedule they prefer, you may get something that isn’t practical or doesn’t meet the business requirements. For example, employees may select a 10-hour shift schedule, not realizing that this would boost the staffing requirements substantially and double the coverage for six hours every day while the shifts overlapped. It’s better to begin by asking the question in general terms, e.g., “Would you be willing to work long shifts in order to get more days off?” This will allow more flexibility in developing schedule options. It will also prevent employees from getting their hopes set on a schedule that is not appropriate for the business and the distribution of the workload.

Since employees may not be familiar with different types of work schedules, some education about schedules may be necessary. This step will open the door to more possibilities. It will also reduce the tendency of people who will immediately reject anything that differs substantially from the current schedule. For example, employees may not consider 12-hour shift schedules because they think the shifts are too long. However, once they realize they would get twice as many scheduled days off and up to half their weekends off, they may be more receptive.

Company Policies

Most companies start with pay policies that were originally designed for eight-hour, Monday through Friday schedules. The policies are usually designed to minimize costs for normal operations while providing premium compensation when the employees are asked to work outside of their regular schedule. They also provide an easily understood way to compensate the workforce for holidays, vacations, and other paid time-off.

When you change employee work schedules, you need to tailor your pay policies accordingly. If you don’t change, there is a good chance that the old policies will:

  • Increase in labor costs.
  • Be illogical, and therefore difficult to understand.
  • Appear to be unfair to different workgroups, lowering morale.
  • Create situations that take pay away from employees, and give them extra pay in others, usually resulting in even lower morale.

There are two points to keep in mind when matching pay policies with the new schedule. First, you should ensure that the workforce has the ability to make as much money on the new schedule (for the same hours of work) as they make on their current schedule. Second, you should protect the company from increased labor costs caused by the wrong pay policies.

Common problems that result from using old pay policies with new schedules are as follows:

  • Unbalanced workweeks. This results in overtime in some weeks, and less than 40 hours of work in others.
  • Vacation tracking and pay. Traditional vacation systems often track vacation time in days or weeks. This no longer works when a day is not eight hours long, or a week is not five workdays.
  • Holiday pay policies. This is one of the most difficult issues to solve and explain to the workforce. You need to answer questions such as: How do you handle holiday pay if an employee was not scheduled to work on that holiday? Should they be paid for eight hours, or the number of hours they are scheduled to work?
  • Double-time. Old policies usually result in either the employee losing the double-time opportunities they had in the past, or significantly increasing double-time costs to the company.
  • Overtime and absence coverage. How do you cover an absence if you are working 12-hour shifts? How do you distribute overtime fairly?
  • Breaks, lunches, shift differential, attendance systems, meal pay, shift assignment, overtime distribution, and many other policies can also come into play when you change schedules.

Summary

Changing employee work schedules is not a simple task. There is a lot more involved than simply finding a work pattern that matches the new hours of operation or accommodates a preferred shift length. The six major considerations are the change process, coverage requirements, available resources, schedule constraints, employee preferences, and company policies. Skipping any one of these can result in implementation delays, unhappy employees, damage to your relationship with workers and the union (if you have one), poor business results, and higher costs. However, with proper planning, preparation, and communication, it is possible to produce a win-win result for employees and the organization.

Changing your organization’s work schedules may be one of the most important tasks you undertake in your career. Not only is the schedule vital to the performance of your company, but it is also an integral part of your employees’ lives. The time and effort you invest will increase the chances of achieving a positive outcome for everyone affected by the new schedule.

Call or text us today at (415) 858-8585.

Employee Shift Work Schedules: an Introduction

Be sure to look at our News Topics (on the menu bar above) to find a wealth of information about all sorts of shiftwork issues, including schedules, staffing, overtime and change management.

by Bruce Oliver, Consultant, and Dan Capshaw, Partner, Shiftwork Solutions LLC (Republished with permission from the Society of Human Resource Management)

According to the Bureau of Labor Statistics, 14.5 million full-time wage and salary workers, 14.5% of the total, were working a shift other than a daytime schedule in 2001. These “shift workers” are often stereotyped as blue-collar manufacturing, mining or transportation employees. In fact, shift workers can now also be found in around-the-clock customer service call centers, retail establishments, information technology monitoring, and support centers, hospitals, utilities, hotels, casinos, emergency response services, and 24-hour news operations.

As the need for extended operating hours grows, more and more organizations are adopting work schedules that require longer and/or multiple shifts. HR Generalists are often asked to participate in efforts to develop and implement the new work schedules. This is the perfect opportunity for them to take on a leadership role, and ensure that the schedule satisfies both the business requirements and preferences of the workforce. However, if they are new to the job or unfamiliar with shift schedules, this can be quite a challenge. This paper will introduce HR Generalists to five fundamental components of shift work schedules:

  • Shift length
  • Schedule format
  • On-off work pattern
  • Overtime
  • Scheduling policies

Shift Length

Most shift workers want to work shifts longer than 8 hours in order to get more days off. The benefits can be substantial. For example, on a 24/7 shift schedule with level coverage (the same number of employees working on every shift), 8-hour shifts will provide 91 days off per year, 10-hour shifts will provide 146 days off per year, and 12-hour shifts will provide 182 days off per year

Ten-hour shifts are preferred by many employees because they are viewed as more tolerable than 12-hour shifts. Unfortunately, 10-hour shifts are unsuitable for most 24-hour operations. They take more personnel because they require 30 hours of work per day instead of 24 hours (3 * 10-hour shifts/day = 30 hours/day). They also result in 6 hours of double coverage when the shifts overlap (30 hours – 24 hours = 6 hours). If the workload is constant throughout the day (as it is in most continuous operations), these overlaps increase the coverage and the staffing requirements unnecessarily.

However, 10-hour shifts can be a good fit in organizations where the workload fluctuates, especially if there is a busy period that occurs around the same time every day. Good examples are law enforcement and communications/dispatch centers that can use extra help every evening during the rush hours. The key is to align the shift overlaps with the periods of high activity, so the coverage is matched with the workload. This will improve service levels and boost the morale of the people who have to work during these busy periods.

In organizations with constant workloads, 12-hour shifts are the best alternative to 8-hour shifts. Few employees seem to like the long days, but they love the extra days off. Some companies are reluctant to adopt 12-hour shifts out of fear they will cause health or safety problems. Research on the subject contains mixed results, but this is because the studies failed to take account of differences in the types of work schedules examined, such as starting times, fixed vs. rotating schedules, the speed, and direction of rotation, hours worked per week, the number of days worked in a row and the number of days off. In our experience, 12-hour shifts are a good option for many 24-hour operations. But several considerations are in order:

  • Can the employees really work 12 hours without any adverse impact on productivity, quality, and safety?
    As long as total hours remain the same, most jobs can be performed equally well on short and long shifts. There are some tasks (such as tedious detail inspections) that are best kept to shorter shifts. Longer shifts can be used under such conditions but the employees will need to rotate to other positions periodically to keep themselves fresh.
  • Environmental conditions must be considered.
    Exposure to extreme heat, loud noises, toxins, and heavy physical labor may simply be too much to endure for more than 8-hours. However, if the longer shifts come with more days off, this is usually not a problem.
  • What does the workforce want?
    While longer shifts are certainly popular nationwide, they are not the unanimous preference of all shift workers. For employees to make the right choice on shift length, they should be given a clear understanding of what they are getting into and what patterns are available.
  • Does it make good “business sense” to go to longer shifts?
    In most cases, a company can be neutral on this issue. Careful business analysis can help you understand your alternatives. The details of this analysis are beyond the scope of this paper.

Schedule Format (Fixed or Rotating Shifts)

Fixed shift schedules mean that employees always work the same shift (e.g., day shift). They may work different days each week, but always on the same shift. Rotating shift schedules mean that employees will regularly switch to a different shift (e.g., days to afternoons to nights).

Rotating shifts have the following advantages:

  • Skills are balanced on every shift. Since all crews take equal turns at covering the undesirable shifts (weekends and nights), there is no incentive for all of the senior, more skilled workers to pool together on a single crew.
  • All workers are given equal exposure to the day shift. As crews rotate through their turn on day shift, they are exposed to managers, engineers, vendors and company support personnel.
  • Training assets can be consolidated. Since all employees rotate through day shifts, there is no need to duplicate training efforts on the other shifts.
  • Product uniformity goes up. As a result of equal training, equal exposure to support and management, and equal skills, all crews will perform in a much more uniform manner.

Fixed shifts have the following advantages:

  • Employees prefer fixed shifts. Senior people want to get (and stay) on the day shift. Junior employees like the idea of eventually being able to move to their favorite shift. And most people simply want the stability of always knowing when they have to be at work — allowing them to better plan their family and social lives.
  • Unbalanced workloads can be more easily matched. If the workload is lighter on the night shift or if it requires different skills, it is simple to change the size or composition of the crew to match the specific conditions.

On-Off Work Pattern

The on-off work pattern describes the number of consecutive days worked and the number of days not worked. Most office workers have a pattern of five days of work (Monday to Friday) followed by two days off (Saturday and Sunday). Shift workers, of course, have many more possibilities. At one extreme is a series of short work periods separated by short breaks. A simple example is a work schedule consisting of two days of work followed by one or two days off. At the other extreme is a pattern consisting of long stretches of workdays followed by long breaks. An example is a work schedule consisting of seven days of work followed by one to four days off.

Considerations in choosing an on-off work pattern include:

  • Weekends off. Employees prefer to have weekends off. They want to spend this time with their family and friends. After pay, it is usually the first thing they look at when evaluating the attractiveness of a schedule.
  • Consecutive days off. This is the next priority. Employees prefer long breaks, whether it’s to catch up on their sleep or to take mini-vacations. Long breaks can create communication problems since a lot of things can change while employees are off. When they come back to work, it may take several hours to get up to speed on the current situation.
  • Consecutive days worked. Working long stretches can be tiring. Even with long breaks, this may not be tolerable for some employees. On the other hand, working more days in a row is the only way to increase the length of the breaks.

Overtime

Overtime enables companies to effectively manage variable workloads without increasing staffing levels. It also provides employees with a source of supplemental income without having to spread their loyalty to other employers. When used properly, overtime can be a very powerful tool for meeting increased workload demands while minimizing costs and maximizing employee compensation and satisfaction. However, overtime that is out of control can lead to higher costs, lower quality, low employee morale and increased employee turnover.

The benefits of using overtime include the following:

  • Overtime can be increased and decreased to match labor resources with workload demands.
  • Personnel working on overtime do not require additional training.
  • Staffing levels do not need to change to use overtime.
  • Overtime coverage is available on short notice.
  • Most employees want to work some overtime to supplement their income.

The problems with using overtime include the following:

  • High overtime levels can result in lower morale and decreased productivity. If excessive, it can result in greater absenteeism, increased accidents, and higher employee turnover.
  • Prolonged, high overtime levels can result in the workforce becoming dependent on the overtime to make ends meet. Reducing overtime in this situation can be financially devastating for the workforce and lead to deteriorating employee relations.
  • Cost. In a stable work environment, overtime should average between 5% and 15% of the straight-time (non-overtime) hours worked. Less than 5% overtime indicates you are over-staffed. More than 15% of overtime indicates you are under-staffed.

Scheduling Policies

There are two sets of scheduling policies that may need to be revised when you adopt a new shift schedule. The first set covers the assignment of employees to different shifts or crews. The second deals with the pay policies especially paid time-off. Of course, there are many other scheduling practices, but these two groups include the procedures most likely to be perceived as unfair by employees, and they are a common source of grievances and poor labor relations.

Shift assignment. When employees are assigned to a specific (fixed) shift, the primary goal is to balance the skill levels. As mentioned in the Schedule Format section of this paper, the common practice of using seniority as the final determinant of shift assignments will result in employees with the most seniority (and presumably the most skills) on the day shift. To avoid this, some companies base the shift assignment on multiple criteria, such as skill ratings and seniority. They may require each crew to have an equal number of personnel from each skill level or a minimum number of skill points. Seniority then becomes more of a tie-breaker than the primary consideration in who goes to each shift.

Pay policies. What works for traditional eight-hour work schedules may not be appropriate for multi-shift operation. If the pay policies are not matched with the schedule, they may:

  • Increase in labor costs.
  • Be illogical, and therefore difficult to understand.
  • Appear to be unfair to different workgroups, thereby lowering morale.
  • Create situations that take pay away from employees, and give them extra pay in others, usually resulting in even lower morale.

Common pay policy problems in 24-hour operations include:

Unbalanced workweeks.
This results in overtime in some weeks, and less than 40 hours of work in others. The cost of the company can be tremendous. Hours that could have been paid at straight time with the right policies are paid at overtime rates. It can often be corrected by changing the start of the workweek.

Vacations. 
Traditional vacation systems often track vacation time in days or weeks. This no longer works when a shift is not eight hours long, or a workweek is not five days. In most cases, this can be fixed by changing the vacation into hours available each year.

Holidays.
How do you handle holiday pay if an employee is not scheduled to work on that holiday? Should they be paid for eight hours, or the number of hours they are scheduled to work? How do you keep paychecks whole without significantly increasing holiday benefits (and costs)? Each situation is unique, so careful consideration is warranted.

Absences. How do you cover an absence if you are working 12-hour shifts? Some organizations ask employees to work on a scheduled day off. Others will split the shift so that someone working the previous shift works 6 hours longer than scheduled and someone from the following shift comes in 6 hours early.

When collective bargaining agreements are involved, it is important to involve the Union representatives at the same time you begin discussing the schedule changes. Schedule alternatives and accompanying work/pay policies need to be considered as a package rather than as separate, independent issues. If the new policies (and schedules) are acceptable to the Union, they can be adopted through a letter of agreement to avoid a complete renegotiation of the collective bargaining agreement.

Summary

We have discussed five major components of shift work schedules: shift length, schedule format (fixed or rotating shifts), on-off work patterns, overtime, and scheduling policies. Obviously, many aspects of schedules were not covered, including shift start times, the start of the workweek, the speed, and direction of rotating shift schedules, breaks and meal periods, shift pay differentials, level vs. variable coverage requirements, nap policies, and many more.

Keep in mind that you can’t tell whether a schedule is good or bad just by looking at these five characteristics. As long as your schedule satisfies your business requirements, only your employees can tell you whether the schedule is good. The same schedule at two different sites (even in the same industry) can be perceived differently. Employee demographics will differ. Experience with various types of schedules also will differ. And the previous schedules used at each location may not have been the same.

The key is to recognize that the employees determine what they like and don’t like. They are the ones to say what constitutes quality in their lives. If you want to know their opinion about a shift schedule, you have to ask them. But don’t be surprised when the information you get back shows a broad range of opinions with no clear consensus. We are all a little bit different. And isn’t that exactly what HR is trying to promote?

Call or text us today at (415) 858-8585.

11 steps you can take today to keep your employees safe and your shift work operation going

In light of the rapidly evolving COVID-19 virus situation, I’m going to make recommendations that would normally seem unusual.  Typically, we plan and create shiftwork structures for long-term success.  We look at costs, employee engagement and a wide range of best shiftwork practices.

Today, I want to focus on short term actions: what can plants do today to keep their doors open and keep their employees safe?

Consider these ideas:

  1. If you are running three 8-hour shifts a day, drop down to two 10-hour shifts.  Use the 4 hours of downtime to clean/sanitize.
  2. Don’t have shifts start/stop right after each other.  For example, if you run two 10-hour shifts, make the four hours of downtime occur as two sets of two hours: two hours between each shift.
  3. Eliminate face-to-face turnovers. Consider digital alternatives; perhaps passed along online.
  4. Ask for cooperation in a time of unusual circumstances.  For example, many parents will now have childcare issues.  Look for volunteers to swap shifts to accommodate those that need different shift times for the time being.  Allow employees to donate PTO to a coworker that really needs it.
  5. Stagger breaks and lunches to minimize too many people being in the break/lunchroom at the same time. 
  6. Ensure adequate self-cleansing equipment is readily available; not just at entry points but at every workstation.
  7. Hold training on “best practices” for staying healthy (cough into elbow etc.)
  8. Encourage people to stay home if they are sick.  Put any attendance “point system” on hold.  See our post on the cost of paid time off.
  9. Incentivize people to take vacation now.  For example, if they take vacation off between now and the end of May, you will allow them to take 50% more days off with pay.  Remember, vacation taken now is vacation that will not be taken when you need people as you ramp back up later.
  10. Take advantage of extra downtime to upgrade/repair equipment.  Get as much done now as you can so that when you ramp back up, you are firing on all cylinders.
  11. Lead by example.  Keep social distances.  Be seen as always following sanitary practices.

The COVID-19 crisis will pass.  When it’s over, you want your workforce to still be with you.  Additionally, taking care of your employees creates goodwill within the community.  The right steps now can help you get through these hard times while emerging as the employer of choice going forward.

Call us today if you’d like to keep your employees safe and your shift work operation going. We can help you tackle short term and long-term challenges.  We can help.  (415) 858-8585.

How to be thorough when assessing the true cost of paid sick leave

The health and well-being of the employees is the companies’ top priority. As news about the coronavirus (COVID-19) continues to develop, giving employees more paid sick time gets in the focus.

Although Congress has just passed (March 18, 2020) a major package including an expansion of paid sick days and emergency paid leave for a subset of workers, the bill is not universally applicable to all sizes of businesses and all employees.[1]  

Knowing the actual cost of paid time off can help companies assess the financial impacts of giving more paid time.  

So, what is the cost of the paid sick days? 

Calculating the cost of additional paid time off is relatively straightforward for companies with both 40 hour or 24/7 schedules.

Let’s start with this: there are 52 weeks in a year.  This represents 2,080 hours of work if your workers are on a 40-hour schedule and 2,184 hours of work if they are on a 24/7 schedule (per person before unscheduled overtime).  For example, increasing paid time off by 3% is equivalent to giving employees an extra 62 to 65 hours of paid time off every year.

However, most employers would continue the calculations as follows: “I just gave one person 64 more paid hours off.  I also now need to pay someone else to cover those 64 hours at an overtime rate. Thus, this cost me 64 pay hours plus 1.5 times 64 pay hours for a total of 160 pay hours!”

What’s amiss with this latter way of thinking? There are three inaccuracies with this calculation: 

  • First of all, the 64 hours that you are paying the person to be absent were going to be paid to him/her if she was at work so this is not an “extra” cost. 
  • Secondly, there is an extra cost to pay someone overtime to cover the newly created opening, however, overtime generally costs about 10% to 15% more than straight time; much less than the assumed 50% additional cost.  The reason for this is that while people get paid at a higher rate when working overtime, they don’t earn extra medical benefits, vacations, holidays, etc.  Those costs are associated with straight time wages, not overtime wages.  The liability for these costs is incurred when companies hire someone, not when someone works overtime.
  • And finally, the statement includes no consideration for what would happen if you didn’t give people paid sick time.  What is the cost of a sick person coming to work?  How many others will become sick? How well does a sick person perform?  How does a person view their company when they have always been there when needed and now that they are sick, they are on their own?  How are you viewed as a prospective employer if you don’t pay for sick days but the plant across the street does? The consequential costs of not providing paid sick leave are harder to measure, yet can be substantial.

There is another consideration with regards to paid sick time: How will it be administered? 

  • People shouldn’t be able to schedule it in advance because then it becomes a vacation instead of sick time. 
  • A use-it-or-lose-it policy encourages people to take all of their sick time every year.  A buy-back policy encourages people to come to work when sick so they can get a check at the end of the year when they sell the time back.
  • Carrying sick time over is probably the best idea, however, some companies don’t like carrying an ever-increasing paid sick time liability on the books, even though there is no additional cost.   There are several ways to make this more acceptable.  For example, let employees carry over as much time as they want, then when they retire, the company can buy back the unused sick time at a reduced rate.  This allows a worker to build up a huge store of sick hours that are available for use if they ever get seriously sick.  When they retire, they may have a year’s worth of sick time that is worth half a year’s wages. 

I’m not advocating for or against increasing paid sick time.  These guiding posts are here to help you make informed decisions ― about a subject that needs careful and accurate considerations.

Call us today to discuss your questions. (415) 858-8585.

[1]: https://www.vox.com/2020/3/18/21185065/congress-coronavirus-tests-paid-sick-days

Best Practices in Shift Work Operations (Part 2 of 10)

Operators and Sanitors should be the same people.  The sanitation process associate with all food manufacturing processes is often a time-thief.  It takes away from valuable production time. Many such operations will have a separate sanitation crew that specializes in sanitation but is not skilled or staffed to run the lines.  This has two negative impacts.  First, the sanitation crew needs a regular schedule, and this is often accommodated by shutting down for an entire shift to let them come in and do their job.  In such cases, it is possible to complete the sanitation process in a partial shift but is metered across an entire shift by using fewer sanitors.  The result is that they may be sanitizing about only 16 hours of runtime when they could run 24 or 40 hours or more without needing to sanitize.  The second negative impact is that if sanitation finishes early, there are no operators present to run the equipment; lines sit idle until the next shift starts.  If operators are sanitors, you can run for as long as you want as there is no longer a designated sanitation shift.  Also, when sanitation is needed, you can perform using an entire production crew and then start right back up immediately.

Do not overstaff.  From a labor cost perspective, there is only one number that matters – Adverse Cost. This is the additional cost you pay for not being perfectly staffed.  If you are perfectly staffed, this cost is zero.  If you are understaffed and have to pay overtime, the Adverse Cost is the difference between your lowest cost option (paid when perfectly staffed) and the cost of overtime.  Since overtime is about 5% to 10% more costly than straight time, your adverse cost is at extra 5% to 10% you had to pay because you were understaffed.  If you are overstaffed, the Adverse Cost is 100% of the cost of that labor since the perfect staffing would have been zero as the position need not have been filled at all.  Thus, the cost of overstaffing can be an order of magnitude greater than the cost of understaffing.

Listen carefully for the term “unfair”.  This word has a far different connotation than say, “I am unhappy.”  When an employee says, “unfair” they are starting to take a particular circumstance and making it personal.  People will complain if they are unhappy.  They will quit if they feel they are being treated unfairly.

Perception matters more than reality.  People respond to conditions as they believe them to exist.  Whether they exist or not is unimportant.  Pay is a good example of this.  If employees are the best paid in the area and have the best compensation package around, they will still perform as if they are underpaid if they believe they are underpaid.  In other words, they will underperform because of perception.  The cure for this is open communications. 

20% of your workforce will work all the overtime you can give them.  This is an extremely useful fact.  So many companies struggle with overtime; generally having to pass out more than the workforce is willing to take on.  However, if you have a fixed amount of overtime and can funnel it to people that want it, you will end up forcing less on those that don’t.  It’s often a tendency to think that complaints about too much overtime means that everyone is complaining.  Knowing this is not the case will allow you to temper your response by taking action to lower overall overtime without eliminating it. High overtime employees have a symbiotic relationship with a company.  The company provides the overtime hours and the employee gladly provides the needed coverage.  It will serve you well to keep these high overtime employees satisfied so they are there when you need them.

This is continued from Part 1 of Best Practices.

Call Us and find out how we can help you optimize your shift work architecture.

Call or text us today at (415) 858-8585 to discuss your operations and how we can help you solve your shift work problems. You can also complete our contact form and we will call you.

Best Practices in Shiftwork Operations (part 1 of 10)

Whenever we meet with a leadership team at a facility, the question always comes up, “What are other sites doing that works?” The second most asked question is, “What are other sites doing that doesn’t work?”

Operations managers want to hear the answers with regards to other operations while Human Resource managers want the answers with regards to employee issues. In short, they are looking for Best Practices. To address this area of interest, we are creating a 10-part series on Best Practices in Shiftwork Operations. This is the first installment.

  1. Avoid rotating shifts.  If you want to chase away potential employees, tell them you have rotating shifts.  More than 80% of all shift workers prefer fixed shifts.  More than 60% of all shift workers want fixed shifts even if they know that they won’t be assigned to their favorite shift.
  2. Don’t start earlier than 6:00 am.  Our research has shown that starting an hour earlier than 6:00 will result in 20 minutes less sleep per night.  In other words, if shift workers have to get up earlier, they go to be earlier, but by a smaller amount and thus, shorten their sleep period.
  3. Pay 10% to 15% shift differential for non-day shifts.  A shift differential is an incentive to get people to work a shift they would normally avoid.  The smaller the differential, the fewer people you will get that voluntarily work a non-preferred shift.  The shift differential paid by a neighboring facility is unimportant.  You are not competing with them for labor.  You are competing with your very own Day shift for Nightshift labor.
  4. Don’t pay weekend premiums.  Linking premium wages to a day of the week will lock you into paying premium wages for those days – forever.  Instead, link premium wages to consecutive days of work or total hours worked.  You have control over those.  You can lower overtime by hiring and thus, reduce premium wages.  No matter how many people you hire, if you now pay a premium wage for Sunday, for example, you will continue to pay premium wages for Sunday.
  5. Don’t use a weekend crew.  A weekend crew with fall under one of the following 2 groups, neither of which is sustainable: (1) Pay for weekend people is proportional to hours worked.  Since they work fewer hours, they get less pay.  This will result in a high turnover within weekend crews.  Low skill levels, high absenteeism, and low company loyalty are typical characteristics. (2)  Pay full wages and benefits to people only working partial weekly hours (typically 24 weekend hours).  This will get your skilled people to the weekend but it will increase overall labor costs by as much as 25% since it will now take 5 crews instead of 4 crews to staff a 24/7 operation.

Call or text us today at (415) 858-8585 to discuss your operations and how we can help you transform your work environment. Or, complete our contact form and we will call you.

5 Things Human Resource Managers Need to Know About Shift Work

Let’s start with this: my intent with this post is NOT to tell H.R. how to do their job. Rather, I want to round up some of the most important aspects of shift work that seem obvious but are easily overlooked.

So, let’s get to the list…

#1: Beware of the lone messenger.  No one is going to come to H.R. to tell you how much they like the schedule they are currently working on.  When people are unhappy, they complain. When they are happy, they are quiet.  This means that people coming to your office to complain about the schedule will ALWAYS outnumber those that come by to tell you they love it.  Just be aware that listening to those that come to you is not a representative sampling of your workforce.

#2:  Your company is different from other companies.  What the average shiftworker wants or what a nearby plant is doing has little bearing on what you should be doing with your schedule.  After nearly 30 years in the business, I can tell you exactly what the average shift worker likes and doesn’t like; and yet…I have never met an average shift worker.  Everyone is unique.  In the same way, your business is unique from the company down the street.  What works for one company is not necessarily what will work best for you; even if you are in the same industry.

#3: Know who your stakeholders are.  As a service organization, H.R. works for several different interests including planning, production, maintenance, quality, administration, and leadership.  All of these have different functions and thus often require different shiftwork structures and outcomes.  Serving several masters is no easy task.  All need to be heard.  All need to be tended to.  Remember, if H.R. was easy, no one would need you.

#4: The impact of Shift Schedules can be far-reaching.  Recruiting and retention of skilled employees are always affected by the shift schedule being used.  Supervision, absenteeism, vacancy coverage and overtime will also be impacted.

#5: Managing the change to a new schedule: when it comes to DOING it, HOW is as important as WHAT, WHY, WHERE and WHO.  Process is everything when it comes to changing a shift schedule.  How you communicate plans and ideas as well as how you solicit input from affected parties will determine the ultimate level of success you experience with your change.

For conscientious HR leaders, to whom employee engagement is a strategic priority, Shiftwork Solutions LLC will help improve retention and work-life balance. Shiftwork Solutions LLC is a change leader, known for maximizing employee engagement with the insights of its comprehensive employee surveys ― deployed in a managed transition process. Our solutions promise to attract and retain a skilled workforce into a custom-designed schedule. Employees will feel valued and will be instrumental in delivering on growth targets.

Call or text us (415) 858-8585.