Small Businesses and the Use of Flexible Work Schedules
Featured Guest Blogger August 4th, 2008
Thank you to Tiffany Gabrielson, Boston College Law Student and Sloan Network Research Assistant, for today’s guest blog entry.
The trend towards flexible work schedules is catching on beyond the typical mega-companies traditionally associated with such policies. The limited number of employees in a small business has led many to believe that the combination of small business and flexible scheduling is both financially and practically impossible. Many small businesses are defying this myth, however, and are implementing flexible schedules. In fact, research suggests that small businesses are more likely to implement various types of flexible schedules then their big business counterparts. A 2005 survey found that 17% of small businesses allow a majority of their employees to change starting and quitting times on a daily basis, while only 4% of big businesses do the same. In addition, many of today’s small businesses make job-sharing, part time, and telecommuting policies available to their employees.
Why are so many small businesses now implementing flexibility? In some cases, the shift comes as a reaction to the long hours and rigid policies of many corporate business practices. A number of small business employers are individuals who formerly worked in a large corporate environment and left big business for a better work-life balance themselves. By forming their own companies, these employers were given the opportunity to make their own rules, and many allow their employees to do the same.
In addition, many businesses provide flexible work schedules because they think such policies simply make good business sense. Flexible schedules provide a work-life balance which is coveted by many potential employees, and instating such policies can help small businesses to attract and retain the best of the best. This competitive advantage is especially helpful in a failing economy, in which a small company may not be able to offer salary and benefits equal to the highest bidder, but can allow for a greater work-life balance. Many of these companies feel they reap benefits in increased productivity and increased employee loyalty.
Do you think flexible work schedules are a viable option for small businesses?
Do you want more information on flexible work scheduling? Check out our Topic Page, Effective Workplace Series, or our Policy Briefing Series.
Many businesses are reaping the benefits of flexible work schedules for purposes of employee retainment. Small businesses are beginning to realize that by offering flexible work options, they can decrease turnover of employees with special skill sets. Replacing employees with experience specific to their industry or their company can be difficult, not to mention extremely costly. While offering flexible work schedules to retain employees is a step in the right direction, many small businesses are far from offering flexible work options as a recruiting tool.
True, when Jane has done an excellent job working for ABC Company for the past 10 years, and now is faced with a significant life change (birth of baby, aging parent, divorce, pursuing higher education) her employer is more likely now than ever to offer her a flextime work option for purposes of retainment. (Flextime being anything full or part time that is not a typical Monday through Friday, 8 to 5 schedule.)
However, most small businesses are not yet to the point of considering the benefits of offering a flextime position for purposes of recruitment. Molly is a highly skilled employee with an exceptional resume. Year after year she has excelled in her position with her previous employer. Now that she is seeking a new job and desires a flextime schedule, she hears the same thing interview after interview: “We work with our employees who have been here awhile and have earned it, but not with new employees just coming in. After you’ve been here awhile, we can consider a flextime work schedule.” Sounds reasonable, but Molly’s current situation requires a flextime position now, not later. Not to mention that the promise of consideration doesn’t mean a flextime work arrangement will actually come to fruition.
Consider that during an interview with XYZ Company, Molly offers to work 28 hours a week. Many employers only offer benefits to full time employees. When you consider that (according to U.S. Bureau of Labor Statistics) benefits are 25-30% of the total compensation an employer pays out for each employee, XYZ Company can realize a significant savings on the cost of benefits by considering Molly’s offer of a part time position. In addition, the employer will recognize savings of a payroll reduction from 40 hours a week to 28 hours a week. With the average 40 hour a week employee producing approximately 32 hours of work per week, the employer may find 28 highly productive hours per week to be sufficient, especially if they hire an individual who is driven to be productive.
Employees are more likely to be engaged, productive, have high morale and low turnover when they are working to maintain a position that provides them with their ideal work/life balance. And small businesses win when they can save on the costs of payroll and benefits while at the same time, hiring exceptional talent.
I think that flexible work schedules are a very viable option for a lot of small businesses. I think it’s increasingly important with the demands that families have with children and the increasing price of fuel. I know that many companies and government organizations are going to a shorter 4 day work week to save on energy costs.
I also think that telecommunting has a great deal of merit if the small business has the technology in place to alllow the employee to get her work done from home. I think that it really requires a responsible and mature employee. From experience, I have learned that some folks just can’t handle the distraction that can come from working at home.
Very thought provoking post!
My PhD is currently looking at the provision of work life balance practices by small
and medium enterprises in Australia. In addition it is looking at the organziational
predictors associated with these firms. I am currently entering the survey data. Many of the respondents have indicated they are offering a number of provisions (informally and
or formally). I look forward to updating you on the results shortly, as I think it will
be nice to see the comparison between the US and Aus.
Flexible work schedules are imperative for small business to allow them to compete with larger companies.
The main goal for any employer to have for an employee is to get the work done efficiently and on time. If an employee can set his/her own hours and be more focused during those hours, productivity will increase along with employee morale. Not to mention the reduced costs for the employer if the employee were allowed to work remotely.