Macy’s mobile shop and pay self-checkout app is proving to be a hard sell to store employees. Other retailers that have self-service methods may be facing some opposition as well. Regulatory issues and labor grievances have surfaced related to cashless store operations, employee staffing levels, and compensation which need to be addressed by retailers, as the emerging checkout technology and hybrid shopper behavior changes the retailer-consumer relationship.
Cashless restrictions can be solved fairly easily as autonomous shopping stores do have in-store employees for stocking and customer service, and they can have a staff member accept cash or a SNAP EBT card. Crediting in-store mobile app sales to commissioned employees will not be as straightforward since collective bargaining agreements (CBAs) will have to be re-negotiated and then the related technology changes made as required.
Self-service checkout is here to stay and there are different iterations for retailers to leverage. At Mercator, we segment self-service into: 1) express self-scan, bag, and pay stations (usually adjacent to regular checkout lanes; 2) scan and pay mobile devices (provided by store); 3) scan and pay mobile apps (from customer phones) 4) order and pay kiosks (usually in restaurants); 5) autonomous checkout, which is the Amazon Go model, now also found from several tech developers and retail partners that are operational or in testing.
The following excerpt from a CNBC article reports more on the topic:
When Macy’s rolled out a new self-checkout feature in its mobile app in 2018, the department store touted how customers could browse stores but skip the hassle of the checkout line. For some store associates, however, that set off alarm bells — and concerns that it would jeopardize their jobs or dock their pay.
Three years later, a union that represents Macy’s employees has scored a victory in challenging the tech-based approach and how it cuts them out of commissions. An independent arbitrator ruled last week that Macy’s violated its bargaining agreement and said the company must exclude departments, such as men’s suits and cosmetics, that have commission-based pay from self-checkout.
The grievance was filed by about 600 employees at six stores in the Boston area and Rhode Island who are part of the United Food and Commercial Workers. UFCW represents 1.3 million workers, including over 11,000 Macy’s workers in major cities including Seattle, San Francisco and New York City.
Overview by Raymond Pucci, Director, Merchant Services at Mercator Advisory Group