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Maintaining accurate pay levels in flexible work environments

November 28, 2011

Cross training employees for worker flexibility has been receiving quite a bit of coverage recently. While employers are seeing huge advantages in this model, particularly for their workforce, maintaining accurate payroll requires more advanced labor management approaches.

USA Today video highlights flexible work schedule

General Motors was profiled in USA Today for their flexible work environment at their assembly plant in Baltimore, MD. According to the GM spokesperson, all employees rotate from one job to the next throughout the day, sometimes every hour. Every employee is trained on multiple jobs in the plant.

The benefits far outweigh any downside for GM. Employees are much happier in their job, while employers benefit from higher employee satisfaction & retention, injury prevention and fatigue avoidance. Prior to the flexible environment, employees stayed on same job all day long, using the same muscles and making them more injury prone, ultimately leading to employee absence. Not only can employers help reduce absenteeism, when workers are absent there is a larger pool of workers available to cover their tasks. Employers can also adjust quickly to heavy workloads and backlogs in areas when they occur, having more workers available to take on a wider range of tasks. Quality issues can also be addressed by multiple people as opposed to relying on one resource.

However, there are some downsides discussed in a Human Resources Executive article Job Rotation Not Without Risk. There is the obvious increase in training costs, but also the increased risk for both injury and poor quality from new, less-trained/experienced employees.

But how can employers track and maintain accurate payroll for their employees in a flexible environment? What if there are different pay levels for certain jobs in an environment? If an employee is working overtime, what pay rate is applied? A proven solution by many companies is with automated labor data collection terminals. Employees can input job transfer status changes as they move from job to job – through time clocks, desktop computers and/or mobile smart phones. When integrated with a workforce management platform, accurate time keeping and paycode information is collected and accurately calculated per employee. Additionally, job quality, employee productivity and work in progress details by work order and employee can also be calculated, providing valuable insight into employee, team, and shift or line productivity.

If you currently offer a flexible work environment, how are you collecting job and paycode details? Is variable pay and OT a challenge? Do the benefits still outweigh the costs you may incur?

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