ObamaCare’s Effect on Full-Time Versus Part-Time Call Center Hiring

By David Filwood

Two of the main reasons employee quit rates are high in the call center industry are low pay and lack of healthcare benefits. In call centers where there is low pay and no healthcare benefits, the above-average agents are the ones who jump ship first. This leaves the “loyal” workers – average and below-average performers.

Paying your call center employees reasonable wages (above minimum wage) can help motivate your above-average agents to stay with you longer. According to People Report (www.peoplereport.com), a company that provides HR metrics for the fast-food industry that has employee turnover issues similar to call centers, employers who pay at least a portion of the healthcare insurance premiums for their full- and part-time employees have retention rates ten times higher than employers who don’t.

In spite of this, the media has recently highlighted stories about employers who are using the Affordable Care Act (ACA), also referred to as Obamacare, as a reason to cut their workers’ hours. According to these reports, some employers are converting full-time employees into part-time workers in order to remain under the fifty full-time worker cutoff for the ACA employer mandate. Any new job openings are then for part-time work.

The ACA employer mandate requires large call center employers to provide healthcare to full-time employees who work thirty or more hours per week. A call center is deemed to be large if it has fifty or more full-time employees. Under the current provisions of the ACA, a call center employer could resize and structure their workforce to have 1,000 part-time agents and forty-nine full-time employees and still be considered a small employer.

Even though implementation of the provisions of the ACA law dealing with the employer mandate have been delayed until 2015, this trend towards part-time employees has already begun to take hold in some industries.

There’s no magic formula to determine if part-time work is the wave of the future or appropriate for your call center. Generally speaking, here are some pros and cons for these two primary workforce approaches for call centers.

Part-Time Pros: Call centers made up of part-time employees provide for reduced compensation and benefit costs, and they are attractive to desirable labor demographic segments such as students and working mothers. This also allows for greater schedule flexibility, which lets employers adjust staff levels to better meet caller demand.

Part-Time Cons: Part-time call centers may see less employee loyalty, including higher turnover and inconsistent employee productivity. Potential workers can simply choose not to go to work for companies that play the “part-time only” game, resulting in fewer candidates to fill part-time call center jobs or leaving only less-desirable applicants. In addition, with higher turnover and a larger workforce, training costs increase.

Full-Time Pros: Call centers comprised mostly of full-time hourly employees have the potential for higher productivity and service consistency. This is due to higher employee retention, stronger employee loyalty, and more solid team unity.

Full-Time Cons: Full-time call centers tend to carry higher compensation and benefit costs. And by depending on a smaller workforce to carry a larger workload, burnout and emotional exhaustion become a bigger factor.

In considering these items, keep in mind that top-performing contact centers tend to drive their revenue and performance through superior hiring tactics. Be sure to factor this reality into any employment strategy.

David Filwood is the founder and principal consultant with TeleSoft Systems, providing consulting, hiring, and training solutions to call centers.

[From Connection Magazine November 2013]

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