Companies and governments around the world have recently been discussing this issue, driven by the tight labor market, along with workers seeking more flexibility. A proposal in the California state legislature will set the state work week as 32 hours, not 40 for larger companies. The California State Labor and Employment Committee is expected to decide by the end of next week whether the bill will move forward. Although the proposal is still many steps away from becoming law, if passed, the bill could affect more than 2,000 businesses.
Many workers would take advantage of the opportunity for a longer weekend, and companies have recently begun to seriously experiment with reconfigured schedules. Companies from the Kickstarter funding platform in Brooklyn, New York, to Unilever New Zealand are piloting four-day workweek programs to test their performance and deal with difficulties.
“It’s not going to go away,” said Evan Lowe, a member of the California Democratic Assembly who co-authored the bill. Workers emerging from the pandemic are given flexible schedules, and some companies competing in the narrow labor market are adapting, he added.
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California is home to many of the world’s largest technology companies and is the most populous state in the United States with about 39 million inhabitants. If passed, Bill AB 2932 would set the working week at 32 hours for private sector companies with more than 500 employees. Hourly employees who record more time will have to receive time and a half for overtime.
Earlier this month, the California Chamber of Commerce added the bill to its “list of job killers,” saying legislation would significantly increase labor costs.
Requiring companies to pay the same amount of money for one working day less will not work well if the bill passes, said Nicholas Bloom, a professor of economics at Stanford University.
“Jobs will be relocated to Nevada or Oregon, and employers will not be able to raise wages for many years,” he said. A better alternative for companies and shift workers who have to work in person, he said, would be longer hours spread over fewer days, with workers benefiting from not having to travel as much. a lot.
The four-day work week has been talked about for decades, and some companies and towns have already defined the 32-hour week as full-time. During the Great Depression, companies reduced their working hours because there was so little work available. Richard Nixon, when he was vice president of the United States, predicted that Americans would stop working five days a week at some point.
Studies on the effectiveness of shortened weeks are mixed. Economic studies in Germany and France found that fewer hours did not increase employment. A 2013 study on private companies in Belgium found that employees who work between 25 and 35 hours a week are more productive than those who work more or less.
Many employers are not fans. A recent survey of 459 companies, mostly in technology, found that 90% of companies do not plan to adopt a four-day work week, according to the Sequoia Consulting Group, which conducted the study. In 2019, Microsoft Corp. stopped the four-day weekly experiment in Japan after five weeks.
Most tech workers say they invest much more than 40 hours a week, so it would be difficult to get their work done in 32 hours, according to Kyle Holm, vice president at Sequoia Consulting Group, who advises clients on compensation and benefits. Salaried employees usually do not meet the requirements for overtime work.
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“For me, this doesn’t really correspond to what people actually do when they are not paid on an hourly basis,” he said. In addition, many companies have already taken into account workers’ preferences by offering hybrid schedules in which employees come to the office only three days a week, he said.
The concept of a four-day work week is not surprisingly popular among workers. A survey of more than 1,000 workers conducted by Qualtrics, a cloud software company, found that 92% of people would support a four-day week and that 37% would be willing to take a 5% pay cut in exchange for a schedule change. Many also acknowledged the shortcomings, with nearly three-quarters saying they would work longer anyway.
Denise Rousseau, a professor of organizational behavior and public policy at Carnegie Mellon University, suggests that companies conduct tests on a four-day work week or a new type of schedule in which major hours or blocks of time on certain days when people are free to collaborate with colleagues , are used.
“It’s good to shake things up because you identify what’s critical and necessary and what’s not,” she said. “Employers have a lot of incentives to waste people’s time if basic value-added work can be done in 30 hours, but you have 40.”
Buffer, a maker of social media marketing software, adopted a four-day work week in 2020 after internal polls showed employees needed more support during the pandemic, said Nicole Miller, director of human resources. Initially, the company was considering offering people a pandemic scholarship or an iPad.
“The big answer was that people want more time away from work,” she said.
Buffer, who hires nearly 90 full-time staff, did not cut pay despite the change in schedule.
The company has closely monitored performance indicators and found that employees do more in less time, Ms. Miller said. For example, engineers wrote more lines of code in November 2020, in shorter weeks, than in November 2019, when they worked five days a week. During the short work week, Buffer employees have the flexibility to work four longer days with a total of 32 hours or five shorter days.
“It really makes those four days a little more intense,” Ms. Miller said. “There’s a misnomer that it’s easier in some way or that it’s a little less stressful.”
Write to Catherine Bindley at katie.bindley@wsj.com
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