Can the 4-Day Week Work for Business? | The Pros & Cons Evaluated
Is the 4-day week a magical solution to the UK's productivity problem or is it an unrealistic dream? We weigh up the pros versus the cons and offer a possible compromise.
In September 2018, the Trade Union Council (TUC) made a call for businesses to move towards implementing a 4-day week with no cut in salary for workers in the UK.
Their argument is centred on the fact that - whether we like it or not - automation is coming, and it needs to be approached as an opportunity for positive change rather than a threat to people’s livelihoods.
The benefits this would bring to employees are clear: more free time without a cut in earnings opens up so many options for making our lives more fulfilling. (If you’re anything like us, you’re currently taking a moment to daydream about what you’d do with the extra free time.)
Go back even further and you’ll find predictions made in 1930 by celebrated economist John Maynard Keynes that we’d eventually work just 15 hours a week - now wouldn’t that be lovely?
However, if the 4-day week were to be taken up nationwide, it would be one of the most radical shifts in UK employment law in recent history.
Before we weigh up the arguments for and against the TUC’s proposed change, let’s have a look at our previous changes to labour laws and where the UK stands just now in terms of our legislation, productivity and attitudes to work.
How has employment law evolved?
Historically, UK policy on employment legislation has been a bit slow to change. It wasn’t until the 1970s that most of our anti-discrimination laws, such as the Equal Pay Act, were introduced.
In the years that followed, the main changes to employment regulations reduced the power of trade unions - changing the way unions were structured and making it more difficult for workers to legally strike.
In 1998, New Labour gave us the National Minimum Wage Act and Working Time Regulations, which gave us the right to a minimum hourly rate, 20 paid holidays annually (raised to 28 in 2007), breaks from work, and the option to legally opt out of working over 48 hours a week.
These are benefits we all now take for granted, so it can feel like a long time since they were introduced. However, 20 years is not long in the grand scheme of things.
When you consider that the DVD was invented before people were entitled to a minimum wage, it starts to look less like a revolutionary move and more like a law that was a long time coming.
Back then, the National Minimum Wage was fiercely opposed by business, the Conservative party, and some economists who argued that it would destroy competition and cost many workers their jobs.
If this all sounds familiar, it’s because the same arguments were used against the National Living Wage in 2016. However, the world as we know it did not end, and we now have the highest minimum wage and the lowest unemployment rate since the original was introduced.
Since 2007, there haven’t been any updates to Working Time Regulations, so UK employers can still legally insist that their employees work up to 48 hours per week.
However, we have had some family-friendly legislation on maternity and shared parental leave introduced.
We also now have the right to formally request flexible working after 26 weeks of service and employers are required to fully consider the request and give a legitimate business reason if they wish to refuse it.
This sounds like good progress, but are UK workers and businesses any better off for it?
What is work like now?
Well, for starters, we’re working on average 42.3 hours a week, giving us the longest working week in the whole of the EU.
Despite longer working hours, UK productivity is low and we’re still sitting below our average output from before the 2007/08 financial crash.
Our economy is growing, but at a much slower rate than it used to and we still lag behind the average rate of the other G7 countries. We have what’s been dubbed a ‘productivity puzzle’, where our workforce is putting in the hours but not achieving as much as those in Germany or the USA.
On top of this, many of us feel we don’t have enough time to complete our tasks as research from the CIPD found 30% of workers feel their workload is unmanageable.
Work is also having a big effect on how positively or negatively we feel. The same CIPD survey found that although 30% of us feel ‘full of energy’ at work, 55% of us feel ‘pressured’, ‘exhausted’ or ‘miserable’.
It seems that workers in the UK are becoming increasingly unhappy with their working lives - this year, 48% of us reported being unhappy at work and 79% of us think that our managers don’t care if we’re happy.
On top of this, voluntary resignations have been on the rise since 2012 which is bad news for business: the cost of hiring and training new staff is high and should be avoided where possible.
All of this paints a bleak picture for UK workers and businesses alike. Could switching to a 4-day work week be the answer?
What are the arguments for the 4-day week?
Recent findings suggest that support amongst workers for a 4-day week would be strong. A YouGov poll found that 70% of us would like to work more flexibly in the future. The TUC’s own survey found that 81% of its members would like a reduction in their working week.
It may be a popular idea with employees, but for businesses to get on board there would have to be benefits for them too.
It should be music to their ears, then, that switching to a 4-day week can reduce absenteeism, boost staff satisfaction/retention, and improve overall productivity. The evidence to back up these claims comes from several companies who have already conducted trials of the 4-day week.
Let’s turn our attention to Perpetual Guardian, a trusts business in New Zealand who recently trialled the 4-day working week and are now planning to roll it out permanently.
At the end of the trial, employees reported feeling less stressed, healthier and better in control of their work-life balance. They also reported that they felt they worked better as a team during the trial and were more satisfied and engaged at work.
Their supervisors reported that there was no change in performance levels during the trial; however, team members displayed more creativity, were more helpful and gave better service.
The key takeaway here is that the staff were able to maintain their performance levels without feeling overstretched during their 4 working days.
Whilst there wasn’t an immediate rise in productivity during the 8-week trial, we can’t assume there won’t be a long-term effect once fully implemented. The increase in employee engagement and satisfaction may have a knock-on effect, as the two have often been linked to spikes in productivity.
One company that has seen long-term gains from introducing a 4-day week is the Glasgow-based digital and telemarketing company Pursuit Marketing. Two years ago, they gave all staff Fridays off with no reduction in pay or benefits, and the results have been very impressive.
Since then, they have seen a huge 29.5% rise in productivity and their staff retention figures are excellent - out of 130 employees, only 2 left in the past year. They’ve had such a successful experience with the 4-day week, they’re now rolling it out across their new offices in the US and Spain.
Other companies trialling the 4-day week in countries such as Sweden have also seen productivity rise.
For these companies, the risk of the 4-day week has paid off, and it would be nice to leave it at that and insist we all start working a shorter week right this minute… but in the interest of fairness and precision, we’ll need to have a look at those pesky cons.
What are the arguments against the 4-day week?
The arguments against the 4-day week are the usual suspects that come up whenever changes like these are proposed: it’ll cost too much, it’ll make us less competitive and it’ll cost people their jobs.
Let’s start with the cost. Whether or not a business would be able to bear any cost that comes from implementing a 4-day week will depend on the industry they operate in.
For example, office-based companies like Indycube in Wales can have different staff take their extra day off on different days of the week. This ensures that everyone can take their extra day without the business having to close.
However, businesses whose staff don’t work a standard Monday to Friday pattern would struggle to give staff the extra day without having to employ more people in order to remain operational.
This would be a legitimate concern for those in sectors like retail or care services, as the cost of taking on more staff without reducing the pay of existing staff could be hefty.
This is exactly what happened during a trial of a reduction in working hours at a retirement home in Gothenburg, Sweden. The trial was a success in terms of healthier, happier and more productive employees, but it was very expensive as 17 new jobs had to be created to cover the remaining hours, making it an unsustainable model for that sector.
This makes a universal 4-day week unlikely, as higher business costs could well lead to job losses and price increases.
This brings us to another legitimate concern - if it’s simply not practical or too costly for some sectors, is it fair to make it widely available to some and not others?
Shift and weekend work is more commonly carried out by those on lower paid incomes and is often associated with those on minimum wage rates. This means that the lowest paid workers in the UK would most likely be excluded from the benefits of a 4-day week.
Are they any less deserving of a better work-life balance? Absolutely not! Are they any less stressed out than your average office worker? Anyone who thinks so should try putting in a shift at their local call centre or Costa coffee. (Anyone who can stay positive and professional after a stranger berates them for the incorrect foam-to-coffee ratio on their skinny hazelnut cappuccino is a true hero of the modern world.)
What all of this tells us is that the 4-day week is currently not practical for every business and so can’t be implemented en masse. This may change someday, but for now it will be down to individual businesses to decide if they want to give it a try.
However, there will be many businesses who could implement the 4-day week now but aren’t willing to offer the same pay for reduced hours – so we thought there may be an interesting compromise.
How about 4 days of work and 1 day of staff development?
As much as we’d like to, we can’t take full credit for this fantastic idea… We may have appropriated it from a discussion on the BBC panel show Sunday Morning Live.
On this particular episode, one of the guests was Alan Sugar’s right-hand man Claude Littner and despite having some pretty outdated views on mental health, he did make a rather interesting comment about using the fifth day of the week to develop workers’ skills.
We absolutely champion employers who are willing to invest in the development of their people as the benefits for both parties make it a win-win decision.
The training should obviously be relevant to the work and responsibilities of each staff member and be delivered in a method that’s convenient for everyone.
This could be in the form of a relevant professional qualification which, thanks to online learning, could be studied directly from the office. Alternatively, the training could take a less formal approach such as mentoring/shadowing schemes.
Ongoing staff development isn’t just a box-ticking exercise - it can actually achieve all the lovely benefits that are associated with the 4-day week.
If staff are developing their key skills they’ll be able to perform their role better, making them more productive employees.
It’s also a great way to improve employee satisfaction and so, in turn, reduces staff turnover and increases productivity.
It’s simple really - human beings like to feel appreciated, nurtured, respected and cared for. When we feel these things, we feel happy and are more likely to stick around and do a good job.
Employees are after all human beings, so it doesn’t take Stephen Hawking levels of genius to work out that a happy employee equals a loyal and productive employee.
Being an employer that is committed to ongoing staff development is also an excellent way to attract new talent as it’s a very appealing point to mention in job descriptions and interviews.
How the 1 day of training would operate in practice would depend on each business’s specific set up, but it’s certainly an idea worth thinking about. We think it’s a pretty good compromise for employers who still want their staff to be present for 5 days a week.
The debate on the future of work is one that continues to rage on, particularly given our rapid technological advances. As we get closer to becoming a more automated workforce, arguments will continue to arise about how best to make this work for everyone.
We’re looking forward to hearing what people come up with next – and who knows? Maybe Keynes will be right and we’ll be working a minuscule week with bags of leisure time to enjoy. We can but dream!
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