Retail Therapy: Contingent Workers in the Retail Industry | DCR Workforce Blog

Retail Therapy: Contingent Workers in the Retail Industry

The use of contingent workers in America has been growing exponentially over the last few years, and this growth is led primarily by a few industries such as retail. To put the popularity of this flexible component of workers with the retail industry in perspective, we need only look at how 82% of retail companies revealed in an interview that they are increasingly using contingent, intermittent, seasonal or consultant employees.

Retail withstood the onslaught of online shopping with virtual malls stocked with millions of products to stay afloat. It offers its own irreplaceable attractions such as the luxury of roaming the aisles and the indulgence in impulsive shopping triggered by a more sensory experience of seeing, touching and trying on items. Both brick-and-mortar stores and online retail stores are vying with each other as they compete with for market share. As the retail industry spreads its wings and grows, most retailers are looking for contractors rather than full-time employees to meet their manpower needs.

  • Retail roles – Are all retail jobs on shop floors, bagging and warehouse jobs requiring heavy lifting? The required skillsets in retail are changing and retail industry workers are evolving into technically savvy workers who understand mobile applications, operate advanced technological systems and enjoy cyber security skills.
  • Big data – Retail stores are turning to big data to understand the buying patterns of their customers and to predict their future behavior. They need to base their strategy, future planning and even location-wise services on such insights into customer preferences, holiday and weekend sales, and demographics of the local market, local culture and even the weather conditions. This has led to retailers looking for workers whose skills extend to big data, data processing, reporting and analytics.
  • Research roles – Retail companies need people who understand the reports generated using bid data and link them to strategic decisions by leading efforts to invite customer feedback to isolate factors and issues affecting their performance. There’s also a need to understand the factors behind the success of a product or promotional campaign to decide whether to repeat or scrap it, by carefully manipulating each of the parameters affecting them.
  • IT Security – Many retailers with online presence have learned the hard way that they need to protect themselves against security breaches from deliberate hacking, aimed at stealing their customers’ financial data and information. A breach could provide the hackers with access to the bank or credit card accounts of a retailer’s customers, enabling the siphoning off of funds which would result in huge losses to the customers and a loss of customer confidence in the retailer. There is a tremendous need for strong IT skills that can prevent such a breach.
  • Supply chain and logistics – The retail industry, whether in-store or online, requires supply chain and logistics teams, inventory management and warehouse teams as well as delivery persons to ensure that their aisles are stocked with all the items their customers would order or expect to find on the shelves. The promise retailers make to deliver any order by privileged customers in short windows of time is creating more jobs in the logistics teams, while calling for a higher number of delivery personnel.
  • Miscellaneous – Apart from the above, retailers also need a good quantity of workers to fill positions as sales clerks and marketing experts. They also need technical teams to create their commercial website and mobile applications and manage these sites as sales take place in large numbers and returns and exchanges come in, following the sales, whether offline or online, in equally quick succession. Then there may be openings which are company-specific, based on their own unique business needs and delivery mechanisms.

The retail industry used huge numbers of contingent workers in many of these roles, and many of them face litigation for violating employment laws. Some common violations for which many retail industry players have faced flack and need to guard against are detailed below:

  • Worker misclassification
  • Wage and hour issues related to scheduling but not assigning any work even after a worker waited for hours thereby missing out on work opportunities elsewhere, or for denying them rightful overtime pay
  • Wage and hour violations at locations run by franchisees affect the parent, as a joint employer
  • For making time spent on security checks (when leaving work) non-compensable
  • Illegal deductions to wages to compensate for cash or merchandise shortages, or toward the cost of renting/purchasing uniforms worn to work or as payment for their tools of trade
  • For refusing to accommodate pregnant women, whose normal work duties require them to lift heavy objects

But it must be noted that we also have three retail players, Publix Super Markets, Whole Foods Markets and Nordstrom, in the list of top 10 employers. The retail industry, which is famous for its on-demand nature of business, usually hires thousands of contingent workers in December to meet the increased demands of the holiday season. It may see huge demands alternate with abysmal sales, which makes a contingent workforce program an ideal choice for its talent needs.

If you work in the retail industry, how do you manage your contingent workers?

The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.