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Debate over four-day work week

In recent years, many organisations around the world, including in Australia, have been testing out the idea of a shorter work week. And according to reports, some of these trials have been quite successful.

However, it’s important to note that most of these trials have been carried out in larger organisations with 45 or more employees. Now, there is talk of expanding the idea to smaller businesses. But before we do that, there are some concerns that need to be addressed.

One of the concerns is the impact on the economy. If businesses were to switch to a four-day work week without a corresponding increase in productivity, it could lead to higher costs and potentially higher prices for goods and services. This is especially concerning when we consider the already high levels of inflation that we see in many areas.

Another concern is the impact on small businesses. Small businesses make up a significant portion of the Australian economy and often have tighter profit margins than larger businesses. They worry that the costs associated with a shorter workweek could put them at a disadvantage and make it harder for them to compete.

So, while the idea of a four-day workweek is exciting and has shown promise in larger organisations, it’s important to approach the idea with caution and conduct a thorough impact assessment before making any decisions.

The clock is ticking

A survey by recruitment and workforce solutions specialists Hays shows that 40  per cent of almost 42,000 professionals believe that a four-day working week could become a reality within the next five years. 

Another 21  per cent think it will take up to ten years to happen, while 16  per cent believe it could happen within the next 12 months. The remaining 23  per cent don’t think it will ever happen. The Australian Services Union has also announced the implementation of a four-day work week at full-time pay EBA, while the Senate Select Committee on Work and Care has recommended a trial of the four-day work week based on the 100-80-100 model. 

In Australia, some organizations have already tried or adopted a four-day work week. These include Unilever, Bright Agency, and Our Community. While the idea of a four-day work week is gaining popularity in Australia, it’s important to note that it still needs to become a widespread practice.

Any implementation of a four-day work week would require careful consideration and planning, taking into account the needs of both businesses and workers.

“The four-day work week has been a topic of discussion for several years, but the pandemic shifted the way we work, and now many professionals continue to prize flexibility,” said Nick Deligiannis, Managing Director of Hays in Australia & New Zealand. 

“Proponents argue a four-day work week can boost productivity, improve employee morale and wellbeing, and reduce stress and burnout. At a time of talent shortages, it can also aid candidate attraction, engagement and retention. 

“However, there are also concerns about the practicalities. Many employers worry that a shorter work week could lead to decreased productivity, increased labour costs in organisations that require staff onsite five days a week and increased pressure on staff to meet current outcomes in fewer hours. 

“Despite this, it seems that many workers are optimistic about the prospect of a four-day working week becoming a reality. As organisations continue to experiment with different working patterns, it will be interesting to see if this optimism is justified and whether the four-day work week will become more widely adopted in the years ahead.”

The 100-80-100 model

The 100-80-100 model, created by 4 Day Week Global, is a guideline used by organizations that are considering a four-day work week. This principle states that employees will receive full pay for working 80  per cent of the time and achieving 100  per cent of their productivity targets.

When implementing the 100-80-100 model, there are four main approaches to choose from. One approach is to shut down the organization entirely for an additional day per week, usually on the fifth day.

Another approach is to stagger the days off for teams or individual staff members. Some organizations may choose to implement different work patterns for different departments, such as shorter workdays across all five days. Lastly, some organizations adjust their employees’ hours seasonally, allowing them to work an average of 32 hours per week across the year.

‘Enhanced productivity cannot be the only factor’

Small businesses are currently facing difficulties in finding staff, resulting in an inability to operate at full capacity. The suggestion of reducing work hours would lead to further reduction in their earnings, according to COSBOA. Inflation and worker shortages are driving the demand for higher wages, and if some industries adopt a four-day work week with five-day pay, it could lead to all employees seeking the same arrangement. 

COSBOA anticipates that workers who already receive five-day pay for four-day work may offer to work the fifth day for overtime pay. Additionally, employees may choose to switch to industries that offer a four-day work week with five-day pay, causing further disruptions. 

COSBOA urges caution in implementing a four-day work week and calls for an employer’s perspective and an impact assessment on small businesses to be included in any recommendations from the Select Committee Work and Care Final Report.

View the full Select Committee Work and Care Final Report HERE.

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Yajush Gupta

Yajush Gupta

Yajush is a journalist at Dynamic Business. He previously worked with Reuters as a business correspondent and holds a postgrad degree in print journalism.

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