BY ROSE MILLER
There is a great deal of discussion, posts,
blogs and news reports regarding the proposed
wage increases throughout the country.
The news waves have been blowing up with
opinions. There are many arguments on both
sides and no one can have an opinion without
offending someone.
HR professionals are in a unique position
within this discussion because they represent
management while advocating for employees,
as needed. As a business owner, I understand
the business owner’s struggle. We are a small
company and the margins achieved pay the
bills. As with most small businesses, labor costs
are the largest chunk of the expenses. When
this particular cost goes up, the entire cost of
doing business changes. Everything needs to
be examined and changes must be made to
accommodate the new reality.
As HR professionals, we also can’t ignore
what it takes to make a living wage today.
Majority of business owners think $15 per hour
is an unreasonable minimum wage. However,
my working class parents taught me a great
little formula to go by when I left home. The
formula was to make sure my monthly living
costs did not exceed one week’s pay.
Using this formula, an individual working
full time at $15 per hour would have $600 per
week and their cost of living (apartment, heat,
electricity, internet) would be $600 per month
or less. Well today, good luck with that.
So while both sides can make compelling
arguments, I believe this disruption raises
many operational and human resources issues.
There are many strategies to review before
simply raising the cost of goods or services.
Companies should examine work flows and
determine realistic expectations of how work
can get done.
Perhaps it’s time to invest in newer, more
streamlined systems. Are there redundancies
that can be eliminated? A recent conversation
with a business owner, Tim said, “Yeah. We
did that a while back.” But we ask, “Have you
done it today?” Data is not static. A new reality
means you probably have different metrics
and needs today.
This disruption requires us to count the
cost of each head, so we need to make sure
every head counts. As the cost of the workforce
increases, there is also a call to managing
people better.
I read an article where someone witnessed
a low wage earner giving terrible customer service.
The argument was: Why pay people like
this more when they obviously don’t deserve
it? The new wage should never be seen as an entitlement. Rather, make employees earn it.
We have a retail client, who has always paid
his employees $15 per hour. Hiring is carefully
done and the staff is trained to give above
average customer service. Staff turnover is
low and customers comment on their pleasant
shopping experience.
If employers are paying more, their expectations
should similarly increase. Are managers
taught how to get the most productivity out of
themselves and their staff? Does management
have good ways to measure performance and
outcomes?
Wage increases are hard to swallow. It all
comes down to personal philosophy on the
value of people and corporate governance.
There are value statements from either side.
Employees need to make wages they can live
on.
Employers need to expect workers to earn
their wages and have the work done well. HR
firms bring value with tools and methods that
can assist. We can only try to be a step or two
ahead of the next disruption.
Miller is president of Pinnacle Human
Resources LLC.
Photo Courtesy Pinnacle Human Resources LLC