Lessons from Chipotle: How to Comply with NYC Fair Workweek Law

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Fair Workweek regulations are coming into force across the nation. These ‘predictive scheduling’ laws aim to promote flexibility for shift workers and protect against unfair scheduling practices.

The rules are complex and fines for violations are heavy.

Chipotle recently came under fire in NYC for allegedly violating Fair Workweek laws, including providing schedule estimates and premium pay for employees working “clopenings”.  A lawsuit from the CIty of New York alleges that complaints were received from more than 30 employees at five Brooklyn Chipotle locations. The department is seeking at least $1 million in restitution for workers plus civil penalties and future compliance with the requirements of the law.

For fast-food/casual operators in New York this means, among other headaches, shifts must be planned two weeks in advance and records must be immaculate to avoid costly fines.

And the fact these regulations vary significantly state-by-state makes it all the more difficult for restaurant groups who operate across multiple cities.

Many operators have put dedicated finance teams in place to identify violations and deal with penalties to ensure compliance. But this approach deals with the symptoms of the problem rather than the cause. 

What is needed is a holistic solution that tackles the root cause while also mitigating risks throughout the business, enabling all departments to consistently and proactively work together. 

Giving managers the power to use predictive scheduling effectively, minimizes violations and pushes any violation data straight to payroll to be dealt with in accordance with the law.

The result is greater efficiency and less stress for managers, more flexibility and protection for employees, and better results for the business – not only in terms of happy workers but in costs saved and embarrassment avoided.

Let’s take a look at the rules and penalties for NYC and then how Harri’s system deals with the many challenges they pose to fast food operators in the city.

Regulations and Penalties for New York

Good Faith Estimate

On or before their first day, employees must be sent:

  • A written schedule for the next two weeks, including hours, dates, and shift start and finish times, both for regular and on-call workers.

  • Written Good Faith Estimates giving details of the days, times, hours, and locations they can expect during their employment.

This must be updated when a worker’s actual hours differ from the estimate after three consecutive weeks or three weeks in a six-week period.

Failure to provide or follow Good Faith Estimate: $200

Right to Rest

Employers cannot schedule employees to work two shifts over two days when the first shift ends the day (ie. it is a closing shift) and when there are less than 11 hours between shifts (known as a “clopening” – closing and opening – shift), unless workers consent in writing and are paid a $100 premium to work the shift.

Violation of minimum time between shifts (“clopenings”): $500 plus any unpaid $100 premium

Advanced Notice on Scheduling

Employees must be given the schedule 14 days in advance. For any changes, they must be contacted within 24 hours or as soon as a change occurs.

  • Workers may decline to work an added shift without providing written confirmation.

  • Employers do not have to get the worker’s written consent if the work time is reduced or other changes are made.

  • Employers must pay compensation for changes after the notice period and need written consent if a change is within the 14 days.

  • Employers only need to pay a premium if changes to a shift add up to more than 15 minutes per shift. However, the worker must still consent in writing to any additional time worked.

Failure to provide work schedules in accordance with the law: $200

Failure to provide requested schedules: $200

Penalties for changes to the date or time of a work shift 

  • No change in the number of hours:

    • Less than 14 days’ notice: $10 per change

    • Less than 7 days’ notice: $15 per change

    • Less than 24 hours’ notice: $15 per change

  •  Additional hours

    • Less than 14 days’ notice: $10 per change

    • Less than 7 days’ notice: $15 per change

    • Less than 24 hours’ notice: $15 per change

  •  Subtracted hours

    • Less than 14 days’ notice: $20 per change

    • Less than 7 days’ notice: $45 per change

    • Less than 24 hours’ notice: $75 per change

Access to Hours for Existing Employees

  • Employers must advertise shifts for existing employees before hiring new employees. 

  • Employees have a deadline to accept them before the employer is able to hire new employees.

Violation of access to hours: $300

Exceptions

Premium pay is not required when:

  • The employer closes the restaurant due to: threats to worker safety or employer property, public utility failure, shutdown of public transportation, fire, flood, other natural disaster, or government-declared state of emergency.

  • The employee requests a schedule change to a specific shift.

  • The employee trades shifts with another employee.

The employer must pay overtime for a changed shift.

Retaliation 

Employers cannot punish, penalize or retaliate against an employee in any way that might stop or deter them from exercising their rights under the law. 

The penalties for retaliation:

  • The employer must erase the disciplinary record and reinstate the employee.

  • Back pay: $500 plus any other money or relief to remedy harm to the affected employee.

The penalties for termination as a form of retaliation:

  • The employer must erase the disciplinary record and reinstate the employee. 

  • Back pay: $2,500 plus any other money or damages to remedy harm to the affected employee.

Harri’s Intelligent Scheduling 

Harri’s intelligent scheduling system automatically keeps operators up-to-date with regulations, even across multiple jurisdictions. It helps you not only to actively comply with regulations, but also to use predictive scheduling to improve your business.

Here’s a rundown of the main features.

Good Faith Scheduling Support

The system includes the following features to make employees aware of the Good Faith Schedule during onboarding:

  • The automatically generated Good Faith Estimate document provides new hires with a clear schedule in accordance with the local laws.

  • This is seamlessly integrated into the onboarding process for review and e-signature by the new hire. 

Direct Shift Swaps

Harri’s Hot Fill system allows employees to exchange shifts directly without employer involvement. The peer-to-peer shift exchange does not violate the above rules on shift swaps based on pay rate and overtime thereby avoiding late-change penalties.

Hot Fill - “Uber for your employees”

Here’s how it works:

  1. An employee is unable to attend work and they release the shift 

  2. Other employees have indicated they wish to work on that day if a shift becomes available (note, they are not “on-call”)

  3. The system alerts these employees via SMS and push notification 

  4. The first employee to accept gets the shift 

  5. The manager on duty is notified of the employee’s ETA and distance from work

This system offers more flexibility for employees and makes it far easier for managers to oversee a shift swap, all while avoiding costly late-change penalties.

Calculation of Right to Rest Compensation Payment

The Right to Rest regulation ensures employees adequate rest between shifts. Harri helps managers to comply by alerting them if this rule is violated when the schedule is created, or any time after it is created, so they can proactively make changes to the schedule.

Manager Alert for Penalties Related to Schedule Changes 

Managers have the ability to define compensation rules for changes after the advance notice period. Shift change premium pay is indicated on the schedule itself and included in the total wage cost calculations.

This means managers are fully aware of the cost impact of schedule changes before they put them in place so they are able to plan and make strategic decisions accordingly. It also makes it easy for the finance department to calculate the costs and pay the right amount to the employee.

Predictive Scheduling Premium Reporting

This feature provides managers with reports indicating, in detail, all the premium payments resulting from schedule changes. These can then be passed seamlessly to the finance department where they can be processed.

They can also be analyzed and scrutinized by management so that key decisions can be made on the company-wide scheduling policy to avoid future fines.

Make Sure Your Business is Protected

The best way to ensure compliance, at scale and across states and cities, is to use a holistic system designed for the purpose.

Harri’s smart scheduling tools simplify every stage of the process, dealing with the cause of the problem in order to minimize violations and streamline communication between departments, managers, and employees.

To see how you can use the system to protect your business and lead a happy, better-rested team, get started with Harri’s smart scheduling tools.