Global organizations continue to grapple with rising overhead expenses, seeking innovative ways to manage labor costs effectively while maintaining adequate backfill coverage across operations.
Labor cost control remains a critical priority amid ongoing market pressures. According to Gartner, cost optimization is a key focus for HR leaders in 2025, with 56% of CFOs ranking enterprise-wide cost targets as a top priority, often intersecting with HR strategies to avoid unintended business impacts.
Adopting a proactive approach to labor cost reduction, backfilling/absence management, and workforce management tools can make a significant difference.
We’ve compiled this guide with 6 practical steps to help reduce labor costs while boosting productivity with Indeavor Backfill.
1. Use Predictable Work Schedules
Start by providing employees with predictable work schedules that reduce reliance on last-minute backfilling. Research from Gallup in 2025 shows that high-quality schedules – offering predictability, stability, and employee control – enhance employee well-being and reduce stress. Consistent shifts align with human circadian rhythms, leading to better mental health, reduced anxiety, and improved work-life balance.
Employees plan their personal lives around work, and frequent changes can disrupt this, increasing the likelihood of absences and the need for reactive backfill.
Conflicts between personal and professional life often result in call-outs, complicating vacancy management. Prioritize predictable scheduling to foster reliability and minimize disruptions.
2. Create an Employee Engagement Strategy
HR and operations leaders recognize that recruiting, hiring, and training new employees costs far more than retaining experienced talent – up to 33% of an employee’s base pay per turnover event in 2025. High turnover increases the need to backfill employees in turn driving up labor costs.
With labor market trends showing 35-40 million voluntary quits projected for 2025, organizations face heightened turnover risks amid economic shifts. To stay competitive, collaborate with HR to implement retention strategies.
Employee engagement directly ties to productivity: Studies indicate engaged employees are 17% more productive. By prioritizing engagement, you not only curb turnover but also lower overhead through sustained performance.
While initial investments in engagement may be required, the long-term gains in retention and output far outweigh the costs.
3. Reduce Unnecessary Overtime
Excessive overtime can inflate costs and diminish returns. While it rewards dedicated workers, high overtime levels slow marginal productivity – total output rises, but hourly efficiency drops, per SHRM reviews. Overreliance on overtime often masks underlying backfill challenges rather than solving them.
In 2025, research suggests that over 60 hours weekly often leads to burnout, further eroding performance. In industrial settings, managing overtime is complex due to frequent demands nd unplanned backfill requirements. Deploy tools that alert you to impending overtime, enabling proactive adjustments.
Automation helps rebalance schedules, avoid forced OT (which harms morale), and incorporate insights like skills and certifications. Ensure compliance with rest periods between shifts to evade fines, especially in high-risk industries like oil, gas, chemicals, and nuclear.
Familiarize yourself with regulations and use tech to minimize unnecessary costs.
4. Create a Performance Incentive Plan
Incorporate incentives into your pay structure to drive results. Gartner reports that well-designed recognition and incentive programs can boost average employee performance by up to 11.1%.
This directly lowers labor costs by enhancing productivity and limiting unplanned backfill caused by absenteeism or disengagement.
For instance, bonuses tied to attendance or output can reduce absences and motivate higher effort. If employees see clear paths to extra earnings via targets, they’re more likely to commit.
Transparency is key: Clearly communicate metrics and expectations to build trust. This not only elevates morale but also cuts turnover, amplifying retention savings.
5. Fill Last-Minute Vacancies with Indeavor Backfill
Backfilling absences promptly is essential, given their ripple effects on costs and operations. With Indeavor Backfill (an add-on to Indeavor Operate) you automate the process, ensuring rapid fills without manual scrambling.
Indeavor Backfill <insert hyperlink page?> generates sorted lists of eligible employees (e.g., by overtime equity or seniority) and automates outbound calls with details like shifts and jobs. Employees respond simply post-message, creating assignments instantly while logging everything for transparency.
This minimizes downtime, enforces fairness, and integrates seamlessly with vacancy triggers like leaves, turning reactive gaps into efficient opportunities.
6. Automate Employee Scheduling
Finally, embrace automation for comprehensive employee scheduling. Tools that manage absences, swaps, and vacancies reduce overhead by streamlining tasks and enhancing transparency.
Indeavor Backfill excels here, automating calls to fill vacancies and providing real-time updates. No more last-minute chaos – ensure coverage without excess effort.
Benefits of Indeavor Backfill include:
- Automatically assigning qualified employees based on rules, guaranteeing the right staff daily.
- Ensuring fairness through sorted call orders and audit trails, reducing disputes.
- Cutting excess costs from understaffing, overtime, injuries, or fines – while boosting productivity.
By automating, you free up time for strategic focus, lower expenses, and elevate performance.
