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Smart Ways to Help Low-Wage Workers

Workers trying to support a family on low wages face daunting challenges. They usually can't afford decent day care, for example, so any schedule change at work can wreak havoc as single mothers or job-juggling couples race to find some sort of backup. Virtually any unanticipated event that costs more than even $100 or so, such

as a broken car, can mean getting to work late or not at all, jeopardizing the job or money for food and rent. Such precarious existences contribute to a host of social ills, from broken homes to kids who lag behind in school to illnesses that get treated only at the emergency room.

Can employers can do anything to help? The obvious answer is to boost wages, but most feel they can't afford to pay above-market rates. Still, plenty of other possibilities exist, such as offering small emergency loans or grants to employees who face sudden crises, helping them with child care, or finding creative ways to make their workdays more flexible.

That point comes through clearly in a Boston College report that was due to be released at an Apr. 22 Senate hearing. It looks at what a dozen or so large employers, from Bank of America (BAC) to Marriott International (MAR), are doing to assist their low-wage workers. Such programs can help the companies, too, by increasing "the probability of retaining employees and thus boosting their productivity," says Donna Klein, president of Corporate Voices for Working Families, a business group in Washington, D.C., that sponsored the study.

BASIC TRAINING. The report spotlights companies' efforts to help workers who typically make less than about $9 an hour, which equates to the federal poverty line of $18,660 for a full-time worker earning that rate in a year. Some, such as CVS's (CVS) job-training program, are aimed directly at lower-wage workers. The drugstore chain simulates work experience in mock stores to train employees who have come off welfare and may not have held a real job before.

Other companies sponsor programs available to all employees but that in practice are used mostly by lower-wage workers. For example, a foundation started by a Levi Strauss & Co. executive gives emergency grants or loans, mostly under $1,000, to any Levi employee or retiree who suffers an unforeseen economic blow.

Sometimes it's relatively easy to make a big difference to low-wage workers' lives. In the late 1990s, Kraft Foods (KFT) began allowing its U.S. workers to stagger their work hours each day. That helped lower-wage employees such as secretaries who work in offices, but did nothing for factory workers on shift work, says Kraft work/life director Charsetta Henderson.

EASING THE LOAD. So in 2002, Kraft rolled out a plan called Fast Adapts that allows factory hands to share jobs, swap shifts for a day, or use annual vacation time in increments as small as one hour. "I've used vacation time to leave early to get my 6-year-old son to T-ball or swim lessons," says Ginger Kraft, who has worked in Kraft's 250-employee Jell-O factory in Mason City, Iowa, for six years. "Before, we had to sign up for vacation a week at a time, so this is a big move."

Most people making poverty-level pay hope to work their way up and into better-paying positions. But given the reality of U.S. labor markets today, where 34 million people earn less than $9 an hour, that's simply not realistic for many. Even if employers can't solve that problem, it turns out they do have other ways to help ease the burden. By Aaron Bernstein in Washington, D.C., with Louise Lee in San Mateo, Calif.

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