Call centers jobs are probably some of the most volatile on the US job market. In a move to guarantee better job security in the state of New York, Gov. Andrew Cuomo signed a law requiring companies to report relocations and repay state grants from the past 5 years if they do relocate.
Photo by Hans Pennink, AP.
Short Summary of the New Law
Under the new piece of legislation, any employer that moves a New York call center outside the US or lowers the number of employees by over 30% must report the actions to the state. The data received will be compiled and made public every year by the Department of Labor.
An extra provision of the law requires customer service contracts for call centers within the state of New York.
If companies don’t comply, they could be forced to pay back 5 years’ worth of state grants.
Staying Ahead of a Worrying Trend
The move is clearly in response to the ever-growing trend of call centers closing down and/or moving their offices outside of the US. According to CWA, New York lost approximately 40,000 call center positions in the last 14 years.
The shifts often follow technological advancements, but also move to states where unions don’t have as much power, or countries where wages and benefits cost a lot less than in the US.
Back in March 2019, workers rallied in protest of AT&T closing a call center in Syracuse, with work shipping to another call center in Orange Park , Florida where wages are reported to be lower. This information comes courtesy of Hae-Lin Choi, a deputy political director of CWA District 1. Choi also estimated that around 260,000 people still work in New-York-based call centers.
But It’s Not Just New York
Things are not looking better in other parts of the US.
On Wednesday, January 8 2020, Alorica reported it will close its Mendota Heights, CA call center, laying off 158 employees. The same day, Macy’s announced it would be closing its call center in Tempe, AZ, with almost 800 people being forced to either quit or switch to a different position (in a local distribution center or store).
Similar to AT&T in New York, Macy’s is also moving its call center jobs to Clearwater, Florida and Mason, Ohio. This clearly is a trend and a worrying one, however justified in some cases (like Macy’s reporting 6 consecutive years of declining sales).
So Will the New York Law Be Effective in Saving Call Center Jobs?
It certainly seems like the law will be a significant obstacle for employers thinking about moving their jobs out of the state.
As Gov. Cuomo put it:
As technology advances, more and more call centers are sending jobs overseas, leaving employees scrambling to find work to support themselves and their families […] This legislation will protect New York’s call center workers by putting in place serious financial disincentives for employers who move jobs out of New York.
For now, this seems like a step in the right direction for improving job security in New York. However, it might also be a deterrent for new contact centers opening or moving into the New York State area.