4 things to consider before adopting a four-day work week

Research shows that a four-day work week can lead to happier, more productive employees (Getty Images/Tom Werner)

Work less and be more productive. That’s the stance behind a four-day work week, a debate reignited after the release of an Icelandic study, and of course the pandemic forcing more flexible, hybrid work models upon us.

Calling it “ground-breaking evidence for the efficacy of working time reduction,” the Icelandic study says both employees and businesses can benefit from this model with reduced stress and cost savings amongst the key benefits.   

Others highlight additional benefits including aligning our well-being with the economy and the survival (and recovery) of the environment, stressing they should not function exclusively, but rather in harmony. 

The concept isn’t new in Canada. The David Suzuki Foundation implemented its own version back in the 1990s. While Expedibox, a smart-locker supplier based in Madoc, Quebec, has offered a reduced work week since its founding in 2017. 

If a four-day work week is up for debate in your organization, here are some things to consider.

1) ASSESS IF IT’S RIGHT FOR YOUR BUSINESS

The type of business and industry you’re in will impact the feasibility of a four-day work week, says CPA Marc Belaiche, president of employment agency Torontojobs.ca. “It sounds great as a headline, but there are all these little nuances to think about,” he says.

The more variance in your workforce, he points out, the more challenging it will be to implement, including the number of employees, whether its shift or nine-to-five, full- or part-time work. A policy implemented in a manufacturing or healthcare setting would look different from that of a technology start-up or financial services organization, he adds. 

Subsequently, staff should understand what’s involved, such as any necessary changes and what’s expected of them for it to run smoothly, Belaiche says. Ask yourself: How involved are employees in setting the policy? Is it mandatory or optional? Are there restrictions upon what the employee can do on the extra day off, such as picking up a side hustle?

At Expedibox, the four-day work week aligned with a business model focused on efficiency and saving time and money, explains co-founder Alexandre Vignola Côté. Being a tech startup, with less than 10 employees, it’s easier to manage, he adds.

2) ANALYZE COST IMPLICATIONS

The four-day work week can save businesses money, maintain proponents.   

Sabaa Khan, general director (Quebec and Atlantic) at the David Suzuki Foundation— which allows employees to work 34 hours, Monday to Thursday—points out the tie between employee well-being and cost savings.

Lowered working hours, she explains, leads to reduced employee burnout, sick days and leaves of absence taken. Rejuvenated and less-stressed employees also leads to increased productivity, she adds. 

“What you’re doing is giving employees more time to rehabilitate themselves,” she says. “There are lots of savings you’re making by taking care of your employees.”

Additional cost reductions could be tied to environmental benefits, she adds, including a reduction in energy use, greenhouse gas emissions and other office infrastructure-related expenses. 

Belaiche cautions that this approach could cost some organizations administratively from a human resource and payroll standpoint—particularly small businesses—over the long-term. He recommends businesses look at what output this kind of policy would require considering aspects like vacation pay and salary adjustments, monitoring employee productivity and logged working hours, as well as part-time and contract employees versus full-time staff accommodations. 

3) THINK HOURS VERSUS COMPENSATION 

With reduced hours, questions about compensation naturally arise. Do employees receive less pay if working less hours? Should salaries be adjusted accordingly?

The short answer? It’s up to the organization. For example, salaries of employees who were part of the Icelandic study stayed the same, but hours were reduced, while Amazon’s model, tested on a human resources group, cut hours to 30 per week and reduced pay to 75 per cent. Others, such as Seattle-based, Killer Visual Strategies, compressed a week’s worth of work into four days with employee’s working 10-hour days. 

Economists worry that if this trend were to take off it could lead to dramatic pay cuts and productivity loss across the economy, the Globe and Mail recently reported. Belaiche adds that a longer-term impact on pay could affect hourly rates, vacation pay and other employee benefits as well.   

Expedibox’s approach is to offer salaries slightly above average for the role being filled, explains Vignola Côté. Despite this, he admits that when it comes to recruitment, candidates focused on making money typically seek the 40-hour job over what Expedibox has to offer.   

4) SET THE PURPOSE OF THE FOUR-DAY WEEK

Establishing a purpose for the four-day work week with clear guidelines is key, says Belaiche. 

For the David Suzuki Foundation the purpose is united with the foundation’s mission to protect nature, while balancing employee wellness, productivity and the financial health of the organization, explains Kahn. The five-day workweek, originally invented to humanize factory work, Kahn adds, has only recently been thrown into question, particularly during the pandemic as employees re-evaluate what’s important to them by living and working differently.

“[The five-day work week] has been treated like a given, but it's not in line with human well-being,” she says. “When it comes to harmonizing the economy and the natural environment, biodiversity and protection of the ecosystem, we need to rethink the way we work. That’s the philosophy behind the four-day work week for the foundation. We’re looking for real systemic change.”

KEEP BUSINESS NIMBLE

Demands for workplace flexibility are greater than ever. If you’re worried about losing staff, here’s advice on convincing talent to stay put. Meanwhile, if returning staff to the office is on your radar, take heed of these legal implications when revising workplace policies.

Plus, find out which environmental and social implications are impacting businesses and capital markets most in this CPA Canada report.