The 4-Day Workweek Conundrum

One of the consistent topics we hear about in recent months is the 4-day work week because let’s face it, we all want to work less and get paid more – a win/win for everyone. But how does it work, and more importantly, does it work?

There are several highly publicized trials currently taking place in the UK, US, and Canada, and the momentum is picking up steam in many other jurisdictions.

For a bit of context, total hours worked by employees each year has been in steady decline over the past century, especially in wealthier nations. For Canada, the average work year for employees was 1925 hours in 1970, 1787 hours in 2000, and 1644 hours in 2020, the last year for which data is available.

So, let’s clarify what a 4-day work week might mean because there are two common ways to achieve this.

Traditionally, workers who want to work a 4-day workweek would achieve this by working additional hours each day to make up the hours lost on the day off. This means stretching a 40 hour / 5-day work week into 4 days of 10 hours a day. This would allow employees to maintain the same rate of pay, and for employers to still receive same number of hours worked.

A more recent development has various organizations experimenting with reducing the workweek to 4 days, keeping the same number of hours per day, thus reducing the overall hours worked by 20 percent, while still maintaining the same pay. This essentially means that employees receive a 20 percent (or so) wage increase on an hourly basis.

For employers this may seem alarming, but there are compelling reasons why this could be a worthwhile consideration so we thought we would summarize some of the possible benefits and challenges that can be experienced.

Possible benefits of a 4-day workweek include:

• For those not working from home it means less travel and reduced costs associated with traveling to work. For the business it may also mean reduced operating costs if closing the workplace is an option.
• In situations where the schedule allows it could also mean a 3-day weekend, which is universally appreciated and improves work-life balance.
• Reduced stress and improved mental health as employees are able to spend more time with loved ones and pursuing hobbies and activities that help support individual wellbeing.
• Another possible outcome is improved productivity levels with employees being more focused on their work, but the experiments to date have produced mixed results when it comes to productivity gains.
• Improved recruitment prospects for new talent and improved retention of existing staff – having a 4-day work week may be viewed by some as a powerful incentive to stay put with their current employer when faced with going back to a 5-day workweek.

Possible challenges of a 4-day workweek include:

• The biggest obstacle is that a 4-day work week doesn’t suit every business, with some businesses being unable to fully support this new structure. This could be due to the nature of their business, their size, or financial constraints.
• In situations where not all employees are able to take advantage of a 4-day workweek this could lead to challenging equity situations which could lead to an ‘us and them’ mentality.
• Reduced days of service could also impact the public if the organization or individual are unavailable. This could be especially acute when considering government or medical services.
• Overtime considerations and averaging agreement management which can be administratively burdensome.
• Reduced vacation entitlement where vacation entitlement calculations are based on hours worked. One less day of work may mean 20 percent less vacation time.
• Another possible outcome is reduced productivity. This one point made it to both lists because it is so dependent on the occupation and nature of the work. Some people do well after a lengthy work interruption and others do best when able to continue working on tasks that require uninterrupted concentration. Lots more data is needed before we can make any sweeping statements about worker productivity.

So, is a 4-day workweek right for your organization? The answer is: it depends! There is no clear way to move forward with this experiment but organizations, especially small businesses will need to keep an open mind.

Your Engaged Assignment: Considering a 4-day workweek? Trying to figure out whether you can do it? Reach out to us and let’s see if we can support your decision making.