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employment reforms impact on retail

What do government employment reforms mean for retail?

5 minutes
News

New employment law reforms are set to have a major impact on the retail sector.

Discover the steps HR teams need to take to manage the changes and achieve new benefits.

As part of its Employment Rights Bill the Labour government has promised to deliver a “new deal for working people” that will present both challenges and opportunities for the retail sector

From a time and workforce management perspective we will see a ban on “exploitative” zero-hour contracts, new rights to disconnect out of regular working hours and flexible working practices put into law.

The Workers (Predictable Terms and Conditions) Act will also soon come into force - a legacy of the previous government that requires employers to provide workers with more predictable and stable working conditions, including advance notice of work schedules and protection against sudden changes in work hours.

Let’s consider some of the challenges these changes pose first.

Retailers thrive on flexibility, but often more for the benefit of themselves and to the detriment of their staff. Stores adjust staffing levels based on fluctuating customer demand, particularly during peak periods like holidays, sales events or unexpected busy days. The new changes, in particular the plan to ensure flexible working as a genuine default, tipped in the favour of employees, will make it more difficult for retailers to maintain this operational agility they rely on.

Under the right to disconnect, employees may not be available to respond to urgent requests or schedule changes outside of their regular hours. The Predictable Terms and Conditions Act further complicates this by requiring advance notice of shifts, limiting the ability of employers to make last-minute changes to staff rosters.

But while these regulations pose operational challenges, we should keep in mind that they also offer significant benefits in terms of employee wellbeing and job satisfaction. The right to disconnect ensures that retail workers have time to recharge, which is crucial for mental health and preventing burnout. This is especially important in retail, where employees often face long hours, high pressure and demanding customer interactions. 

There is no doubt this a serious issue. Research by the Retail Trust has found that retail remains on one of the lowest ranking sectors for employee satisfaction across the UK and that people in the industry are facing a wellbeing crisis.

The Predictable Terms and Conditions Act also contributes to employee satisfaction by providing greater job security and predictability. Knowing their schedules in advance allows workers to plan their personal lives better, leading to a healthier work-life balance. This, plus new rights for flexible working, can result in higher morale, increased loyalty and reduced turnover, all factors which are critical for maintaining a stable and experienced workforce in the retail sector.

So how does the sector need to respond?

To comply with these new regulations, and indeed embrace them as an opportunity, retail businesses will need to adapt their workforce management practices. This includes investing in technology. 

HR departments need two crucial elements in place: first the ability to accurately track which staff members are working when, and second tools to effectively plan, manage and monitor workloads within flexible working patterns.

Retailers may also need to implement or upgrade systems that allow for automated shift planning, taking into account employee availability, predicted customer demand and legal requirements.

Additionally, retail organisations and their HR teams will need to establish clear communication policies to respect the right to disconnect. This might involve setting specific times when employees can be contacted or ensuring that all work-related communications are sent during working hours. Employers may also need to provide training to managers on how to effectively manage teams within these new constraints, ensuring that the right to disconnect is respected while still meeting business needs.

One of the other biggest concerns for retail businesses will be how these changes impact customer service. With stricter regulations around working hours and scheduling, there may be times when fewer staff are available, particularly when unexpected demand arises. Retailers will need to find innovative solutions to maintain high levels of customer service despite these constraints.

This might involve rethinking staffing models, or leveraging technology to enhance efficiency and customer service during peak times. 

Make no mistake, the forthcoming reforms represent significant shifts in how the retail sector operates. There is need for positivity though. By embracing these changes and investing in the necessary tools and training, retail businesses can navigate this new landscape effectively, balancing the needs of their employees with the demands of a fast-paced, customer-focused industry. The future of retail work may look different, but if approached in the right way it can be more sustainable and rewarding for both employees and employers alike.

Want to discover more?
Download our whitepaper ‘Why technology is key to retail workforce optimisation’ to discover how HR can exploit new technology to boost productivity and navigate the complexities of the new labour landscape.
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Written by: Isabelle Fassin
Field Marketeer Flanders Protime

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