Is a four-day week the way forward for UK businesses?

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Employment & HR Article

02 August, 2022

On the 6th of June 2022, the world's largest trial of the four-day work week was embarked upon in the UK. 3,300 workers across 70 UK companies have enrolled on the program from a wide range of industries - from a local chip shop to large-scale corporations. The coordinated trial will run for six months and is being organised by 4 Day Week Global in partnership with thinktank Autonomy, the 4 Day Week Campaign and researchers at Cambridge University, Oxford University and Boston College. Joe O'Connor, Chief Executive of 4 Day Week Global said the pilot programs puts the UK at the forefront of the four-day week movement. "As we emerge from the pandemic, more and more companies are recognising that the new frontier for competition is quality of life, and that reduced-hour, output-focused working is the vehicle to give them a competitive edge".

The proposal for the trial finds its basis in the 100:80:100 model, regarding 100% pay for 80% of the time, in exchange for maintaining 100% productivity. Researchers will then monitor the impact of this model on the productivity of the business, the wellbeing of its workers, and metrics regarding the environment and gender equality. Furthermore, there is emphasis on measuring the employees' response to having an extra day off and how this correlates to levels of stress, burnout, sleep, health, energy consumption and travel.

The idea behind the concept is far from new. Henry Ford is the man accredited to introducing the five-day week for his workers back in 1914, departing from the six-day week rota in place at the time. This was then backed up by the creation of unions in the 20th century, which cemented the five-day week as the standard practice. Though could it now be time to depart from this 20th century concept and apply a new model to 21st century business in the UK?

Previous countries' four-day week programs

Iceland: a four-day week trial ran between 2015 and 2019 and found an increase in 2,500 employees' well-being, with improved health and work-life balance.

Belgium: approved the right of a four-day week, with employees able to decide between following this model or continuing with a five-day week.

New Zealand: 81 employees at Unilever's New Zealand office are taking part in a trial lasting the entire year, whilst remaining on full pay.

Pros and Cons

For employers, in the wake of the COVID-19 pandemic, the dynamic for attracting and retaining employees has changed following the Great Resignation (link to article). Therefore, can the four-day week give employers the edge over competitors, making them a more attractive choice? Previous studies have supported this claim, finding that 63% of businesses found it easier to attract and retain talent by offering a four-day week.

However, this approach does not suit industries that require round-the-clock presence. For example, emergency services are less likely to benefit from these measures, given the impracticality. Furthermore, following the similar trial program in New Zealand, an article in the Harvard Business Review has found that work was intensified given the compacted time to complete work, which in turn increased managerial pressures around performance management. "The New Zealand trial rings some alarm bells in that reductions in working days did not necessarily create well-being benefits as workers struggled to meet the demands of their job roles".

What are the implications of offering a four-day work week?

Overall, for employers, offering a four-day week can give you an advantage when it comes to recruitment. This can set your business apart from the competition and allow you to attract and retain the top talent in your industry. For your current staff, offering a four-day week can result in much needed flexibility, which is a highly desirable benefit for the modern workforce. This has been shown to keep staff motivated, improve their morale, and result in fewer absences.

However, the counter-argument to the studies suggests that the compacted week can increase the pressure upon both staff and management. This may also upset your employees who prefer the current five-day week structure that they have had in place for their entire career. As such, when considering the implementation of a four-day week, employers must be mindful whether this is best suited to your workforce and be careful not to prioritise output over the wellbeing of your employees.

There are also practical implications for both employees/ employers to consider regarding:

Holiday entitlement

As an employer, you can set your own rules on holiday entitlement, with the choice to offer more than the legal minimum

When switching to a four-day week, your employees' holiday entitlement will change in line with the reduced number of days worked each year

As such, employees will only benefit from 22.4 days holiday per year, a fall from the 28 days holiday entitlement they will receive working 5 days a week

A reduction in pay/benefits for employees

Despite the UK trial being run with full pay, in practice, employers may take the obvious approach that due to the reduced time spent working, employees will therefore receive a corresponding reduction in their pay

Whilst this can be seen as a cost-saving approach for many employers, some employees may become disgruntled given the reduction in pay/benefits they will receive following the change and it would amount to a change in terms and conditions that you would need to consult on.

Sticking to Working Time Regulations

Despite the extra day off, given the compressed nature of the work week, employers may expect employees to fit five days' work into four. As already noted, employers must be mindful of placing additional pressure on employees, however they must also keep within the Working Time Regulations.

For more information contact Harry Hazelwood in our Employment & HR department via email or phone on 01772 220207. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

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