The 4 Day Week Global trial involving over 3,000 employees across 61 organisations took place last year, with the results having been reported in February 2023.   In late 2022, Labour proposed a 4-day working week bill which was debated in parliament in October.

Does a four-day week work?

The report states that the trial was a ‘resounding success’ with 56 of the 61 participating companies continuing the arrangement (92%). 

The benefits of a four-day working week are:

1. Recruitment and retention – 80% of your working hours for 100% of the pay has an obvious appeal for employees.  The participating companies reported a decrease in staff turnover of up to 57%.

2. Employee health – in the UK in the year 2021/22 (the most recent statistics available), the HSE reports 17 million sick days lost to work related stress, anxiety, and depression. The trial report states that “ ‘Before and after’ data shows that 39% of employees were less stressed, and 71% had reduced levels of burnout at the end of the trial. Likewise, levels of anxiety, fatigue and sleep issues decreased, while mental and physical health both improved.”

3. Productivity – the aim of the trial was to reduce working time without losing productivity.  The trial report suggests this is correct with companies reporting an average of 1.4% revenue growth over the trial period.

What considerations should you take into account if you are considering a four-day working week?

Sounds perfect, doesn’t it?  Less work for the same money, and without the company losing out.  However it is important to bear in mind the potential issues and constraints surrounding such a trial.  If you are considering implementing a four-day week, you will need to consider the following:

Can it work?

Companies are relatively free to choose how to reduce hours.  Under the scheme the requirements were that there must be a reduction of around 20% but without a reduction in pay.  Reduced hours could be closing the entire business on Fridays, staggering off days to ensure that the business remains open for its normal hours, reduced hours, or flexitime.

However reducing working hours without a reduction in pay is unlikely to work for all business models.  Businesses which charge for their time will inevitably see a reduction in income by doing this.  For some employees (e.g. in retail or hospitality work) have no control over their productivity and simply cannot achieve the same amount of work in a shorter period of time. 

Even if it would be possible to fit five days’ work into four days, is it realistic?  Would the stress of trying to do this outweigh the potential wellbeing benefits?

How will it work?

Once you have decided to embark on a four-day week, you should then consider how you are going to do that.  Are you going to close your business one day a week? Are you going to stagger days off?  If so, how will you allocate the days?  Most people will want a Friday or a Monday off, and allocation must be done fairly.

Can it work for all staff?

It may also be that a four-day week model would work for some of your staff but not others.  For example if you have a business with office staff and a production unit, the production unit could not compensate for the reduced time by increasing productivity and the four-day week would not work for them.  The same may not be true of the office staff.  However implementing a four day week for some and not others, particularly with no reduction in pay, is likely to lead to allegations of unfairness.

Will it lead to claims?

Consider the above example.  If you implemented a four day working week for your (let’s assume predominantly female) office staff but not for your production staff (who statistically are likely to be predominantly male), you may be leaving yourself open to a claim for indirect sex discrimination.

Impact on part-time workers

Prior to the concept of the four-day week, part-time meant part-pay.  If you already have staff working four day weeks or similarly reduced hours on reduced pay, you need to consider how you are going to deal with that.  A part-time worker whose colleagues are working the same hours for more pay may have a claim for detriment of part-time workers or an expectation that they should now receive full pay for their part-time hours.  If you have a large number of part-time workers, increasing their pay may be a significant expense.

Further, most part-time workers in the UK are women, which may give rise to claims for indirect discrimination so such issues need to be carefully considered and properly handled.

How to implement a change

Changing working hours is a fundamental change to the employment contract.  It is unlikely that you would be able to implement this change with consultation and consent.  Most employees are likely to consider reduced hours for full pay a benefit and therefore agree, but you need to consider what you will do if they don’t.  In order to secure consent, I would recommend having a clear strategy to manage workloads and communicate your plan and expectations to your staff. 

Trial periods

Most employers would want to make any permanent change subject to a trial period.  Any trial should be long enough to get a clear understanding of any issues and seek to rectify these before ‘pulling the plug’.  In any trial period you should:

• Carefully consider what the period – you should think about how long the trial will last and when it will take place.  For example, you might want to ensure that the trial covers any particularly busy or stressful period in your working year such as traditionally high sales months, financial year end, and any audits.

• Communicate the trial period – you need to make clear to your staff that the arrangement is, initially, temporary.  If you did not, you may find that if you did not continue the trial you would have a number of employees who have acted to their detriment and may struggle to go back to the previous arrangement e.g. if they have changed their childcare arrangements.

• Consider the criteria for success or failure – it is entirely feasible that you, as an employer, might consider a trial a failure whilst employees would consider it a success.  You need to clearly communicate your thoughts and expectations prior to commencing any trial period to ensure that you and your staff are on the same page.

• Include at least one interim review – it is worth having a review midway through the trial (or perhaps monthly/bi-monthly) to discuss what is working well and any changes or adjustments which need to be made.  Employees would likely consider it very unfair if you declared the trial a failure at the end for some reason which could have been addressed months earlier.

• Allow two-way feedback – you should not assume how your staff feel about changes to their employment.  At any review and at the end of the trial, you should invite feedback from your staff on their views as well.

Impact on other terms and policies

It is important to have a comprehensive review of your terms and conditions and your policies before embarking on a trial. Some policies to consider include:

• Holidays – if your staff are working 20% less, will you pro-rata holiday allowance?

• Overtime – do your overtime or TOIL policies need updating?  What if your staff have to come in on their new non-working day?  Will they be expected to do so in certain circumstances?  Will they receive additional payment for doing so?

• Travel – if your staff have to travel for work, how can this work with shorter hours?

• Benefits – you may have benefits which work on a “days worked” basis e.g. daily travel or food allowances.  Do these need to be updated?

Non-working days

You should communicate your expectations for non-working days.  For example, will employees ever be expected to be ‘on call’ for some of their non-working days? Are they paid for this?

It is also important to communicate any limits on what employees can and can’t do on their non-working days.  Are they able, for example, to take up other paid work?  if so are your clauses regarding confidentiality and conflicts of interest appropriate and up to date?                

Summary

Overall there are a number of considerations which need to be taken into account before a dramatic change to your working practices can be made.  The trial report may have declared the four-day working week a success, but that study only involved 61 businesses.  This does not mean it can or will work for any business.

Many are convinced that that UK is likely to follow some EU countries and implement the four-day week as law.  This current seems extremely unlikely, particularly under the current Conservative government.  However, it was the Labour party who proposed the four-day working week Bill and this may be subject to change depending on the results of the next election.  That being said, the law takes a long time to change, and it unlikely that the four-day working week would be adopted as a mandatory requirement without serious and lengthy consultation and debate.

If you have any queries regarding the four-day working week or changing employees’ terms, please contact Arvin Sandhu on 01494 521301.