Study Shows 4-Day Workweek Can Benefit Companies And Workers

Recently, 4 Day Week Global, organized by researchers at Cambridge University, Oxford University, and Boston College, released a report detailing the full findings of the world’s largest 4-day workweek trial. The trial involved 61 companies and approximately 2,900 workers in the UK from June to December 2022.

The study examines the effects of transitioning from a 40-hour to a 32-hour workweek. This document is the second part of a three-part series. Part 1 can be viewed here, while Part 2 focuses on the elements needed to prepare for this transition.

Evaluation

In his book The 7 Habits of Highly Effective People, Stephen Covey states, “Begin with the end in mind.” Organizations seeking to modify their workweek must adopt the same mindset. Before implementing a 4-day workweek, companies need to define the criteria for measuring the success of their implementation.

During the study, companies followed a pre- and post-methodology approach. In the pre-trial phase, companies completed an ‘onboarding’ survey, which provided six months of data to compare with the corresponding data collected during the six-month trial. The collected data included productivity, retention, recruitment, client satisfaction, financial impact, and operational efficiency. The difference between the six months before the implementation and the end of the six-month pilot period was then evaluated.

In addition, employees also participated in surveys, providing insights into their work experience, well-being, family, and personal life. A shorter mid-point survey focused on their well-being and included a time diary to record how employees spent their most recent day off.

Model Selection

Companies engaged in at least two months of preparation before implementing the reduced workweek to maximize the success rate of the 4-day workweek project. Recognizing that the 4-day workweek is not a one-size-fits-all solution, each company in the study designed a policy tailored to its specific industry, organizational challenges, departmental structures, and work culture.

The study identified five different models that emerged:

Fifth Day Stoppage – Companies choosing this model shut down operations for an additional day per week, prioritizing collaboration over coverage.

Staggered – Employees took different days off while maintaining coverage throughout the week. For example, one employee on the team took Monday off, while a different member took Friday off. This day off may change from week to week.

Decentralized – Similar to the Staggered format. However, each department made its own decisions regarding coverage modifications without input from other departments.

Annualized –Staff at these companies worked ‘an average’ of 32 hours per week, with variations depending on the business’s needs. For example, a freight company with deliveries arriving at different daily volumes.

Conditional – Employees would have to work on the fifth day if key performance indicators were not met. Individuals were permitted to work up to a 40-hour workweek in emergencies or contingencies.

The selection of a model hinged on the protection of the 4-day workweek. Companies with a strongly protected 4-day workweek demonstrated higher success than those with weakly protected models. The Conditional Model highlighted this difference, as employees under this model could not plan for their extra day off due to the possibility of being called into work, leading to increased stress levels.

Leave Policies

Updating leave policies was another crucial aspect when implementing a 4-day workweek. Companies need to review and revise paid time off (PTO) policies to ensure that full- and part-time employees continue to accrue PTO appropriately under the new workweek structure. For example, some organizations in the study maintained their leave allowances at the same level in case they returned to their original five-day workweek. However, others changed their leave to a pro-rata reduction in leave benefits to account for the new level of hours worked.

Holiday leave also needed to be addressed. For some companies, the Holiday counted as the extra day off that week. For other companies, they allowed the Holiday to be an additional day off, so they only worked three days that week.

Part-Time Employees

There are several considerations when handling part-time employees transitioning to a 4-day workweek.

Part-time employees often have varying schedules and may not work on consecutive days. Adjusting their schedules to fit the new 4-day workweek may require reshuffling shifts and accommodating individual availability. Companies need to address the individual preferences of part-time employees and find potential solutions or alternatives for those who may not be willing or able to transition to a 4-day workweek.

Compensation for part-time employees may also need to be adjusted, especially if the company adopts the Fifth Day Stoppage model. Additionally, part-time employees typically accrue PTO based on their hours worked, and transitioning to a 4-day workweek could impact their PTO accrual rates.

The shift to a 4-day workweek may also impact part-time employees’ eligibility for certain benefits tied to a specific number of weekly hours. Therefore, companies should review benefits policies and ensure any changes align with legal requirements and the organization’s overall benefits strategy.

Schedule Coverage

Implementing a 4-day workweek may necessitate adjustments to employee schedules. Coordinating schedules and managing potential conflicts can be a logistical challenge, especially when multiple teams or departments are involved. Consequently, management must develop a well-structured scheduling system to ensure smooth operations and effective coordination.

Depending on the industry and nature of the work, a 4-day workweek may require additional flexibility and coverage arrangements. Employers must plan for adequate coverage during non-working days, such as through staggered schedules, shift work, or temporary staffing solutions, to maintain operations and meet customer or client demands.

Compliance

Shifting to a 4-day workweek requires compliance with applicable employment laws and regulations. However, compliance may vary by jurisdiction, so consulting with legal professionals familiar with employment regulations is essential.

A reduction in weekly hours can affect qualification for certain benefits. For example, the Family and Medical Leave Act (FMLA) provides certain employees with up to 12 weeks of unpaid, job-protected leave per year. Employees are eligible for leave if they have worked for their employer for at least 12 months and at least 1,250 hours over the past 12 months. The 1,250-hour threshold may be of concern with a 4-day work week. Additionally, States and other jurisdictions have their own threshold requirements for Paid Family Leave which must be reviewed.

Certain industries may have specific requirements, such as nurse availability at long-term care facilities. Reducing the workweek may require hiring additional staff, either full- or part-time, to comply with these availability requirements.

Mindset

For a 4-day workweek to be successful, leaders must shift their mindsets to value actual productivity, not just hours worked.

Leaders must embrace the uncertainty that comes with trying out a new initiative. One common mistake many managers make is attempting to anticipate all possible problems and eliminate all potential sources of risk before the pilot even begins. While planning is important, avoiding decision inertia is essential, and recognizing that real problem-solving can only be achieved through trial and error.

Finding Efficiencies

The obvious way to reduce hours for most employees was to hire additional employees. However, this method, in most instances, would increase company costs. This challenge proved more difficult for organizations that require an employee-to-customer ratio, like healthcare, childcare, schools, airlines, and hospitality. The key to making the study successful was condensing the work from 40 to 32 hours a week while maintaining output.

The most common way to improve efficiency while maintaining productivity involves reforming organizational meetings. Meetings were no longer used to deliver information but to make decisions. Instead, meetings required agendas and information shared in plenty of time for decision-makers to absorb the materials and provide input. In addition, employees had designated ‘focus times’ during the week where no meetings could be scheduled. This way, employees could focus on their work uninterrupted.

Another area of efficiency was finding places for monotasking. For example, employees who could organize calendars to consolidate similar tasks could eliminate the time between switching jobs.

With a reduced workweek, employees often had to hand off tasks to another employee to complete. New processes to communicate the handoff reduced the ramp-up time for the next person.

Finally, finding ways to automate manual processes, like reports, accounting, and dashboards, helped speed communication and allow for faster response times.

These efficiencies proved valuable in reducing the actual time working for most employees.