A four-day workweek is not a new concept as employers have been using alternative work schedules in various ways for decades. In the past several years, employers have taken a fresh look at enhancing workplace flexibility and work-life balance. Given this renewed interest in flexibility, in 2021 and 2022, several global studies began, allowing employers to experiment with a four-day workweek and document their results on what could be realistic for companies in many industries to consider.
During these studies, employers focused on their own workplaces related to productivity issues and stress, burnout and health. Productivity and health considerations were prominently featured during an International Foundation webcast, “The Four-Day Workweek—A Real Option for Employers or Hype?”, recorded June 14, 2023. In addition, our three panelists discussed the research behind the “why” and “how” of four-day workweeks and legal implications for U.S. and Canadian employers.
Three takeaways from the webcast:
Evidence shows that more time worked does not necessarily mean more productivity. Since around 1980, the gap between productivity and compensation has increased, with productivity gains not translating to increases to compensation on the same scale. According to speaker Dr. Tyler Arnell, chief health and strategy officer of Medikeeper, Inc., “Productivity has increased dramatically, but wages have not kept pace.” Technology has created an increase in productivity over time and “has created an elasticity in the system, which could make a compelling argument for employers looking to introduce a four-day workweek.”
When considering a four-day workweek, employers use a variety of alternate work hour arrangements in the attempt to keep productivity amounts unchanged. For the global studies, many employers used the schedule that best meets the calculation of 100% productivity output, 80% of the time (for a 40-hour workweek, this would be 32 hours) and 100% compensation.
2. Health Impacts
Lower levels of employee engagement affect amounts of stress, anxiety, burnout and depression. Mental health–related issues were obtrusive prior to the pandemic and remain an issue that affects physical health as well, leading to increased levels of conditions such as heart disease, type 2 diabetes and sleep issues.
In the four-day workweek studies, with the shorter weekly working hours, Dr. Arnell said that “employees felt 39% less stressed, and 71% had reduced levels of burnout at the end of the trial.” In addition, “54% of employees found it easier to balance work and family.”
3. Legal Implications
For employers, there are practical considerations that must be addressed prior to implementation of a four-day workweek or an alternative schedule. The legal issues for the U.S. and Canadian employers are similar, with differences based on each country’s different legal environments.
Kier Wachterhauser, partner at Murphy, Hesse, Toomey & Lehane, LLP, said that for U.S. employers, “Change in workplace culture is likely necessary for successful implementation and navigation of the myriad of legal considerations” that come with four-day workweeks. Employers should address:[JM1]
- Labor considerations, especially for bargaining purposes, as many existing collective bargaining agreements (CBAs) do not have work hours or days spelled out
- Fair Labor Standards Act (FLSA) rules that impact both exempt and non-exempt employees
- Administrative issues for accruals of types of paid time off (PTO) and break times rules that vary by jurisdictions.
Stuart Rudner of Rudner Law addressed Canadian employers and said that, especially due to the pandemic, everyone has started to rethink the role work has in our lives. When looking at the potential changes to “how we do things,” employers should proactively identify their risks when making workplace changes, proceed with caution and make sure to document their intentions, saying “employers should treat their employment relationships as legal relationships.” Additional topics for employers to consider are:
- Constructive dismissals, which are affected by substantial changes to terms of employment conditions
- Human rights issues related to child care or elder care and accommodations based on family status
- Statutory considerations for vacation or dismissal entitlements
Visit our InfoQuick on Four-Day Workweeks under the Human Resources category for more information.
Developed by International Foundation Information Center staff. This does not constitute legal advice. Please consult your plan professionals for legal advice.