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Can we make the four-day week work? | AccountingWEB

Can we make the four-day week work?


A four-day working week may offer benefits including improved staff wellbeing and reduced energy costs, but companies need to carefully consider the other effects of shifting their workplace culture.

31st Aug 2022
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When considering a new job, it long was the case that the salary was negotiable, but everything else was one-size-fits-all for employees. Where you work, your hours of work, the number of holidays you could take and how much sick leave you were allocated were all set in stone. Today this has all changed, thanks to remote and hybrid working becoming commonplace and a draw card for top talent. 

This evolution of the workplace has opened the gates for another apparent immutable to be negotiated: the five-day working week. This has become a key non-salary-related lever that can be adjusted to attract and retain good people in the face of the Great Resignation and negative unemployment rates. 

Success and sustainability

A four-day week is now being trialled at a range of companies in several countries around the world, including the UK, with varying degrees of success and sustainability. 

It is worth pointing out that a four-day week is not intended to be a compressed work week, where you do your typical number of hours in four days, rather than five. And it does not mean getting paid less for working fewer days. Typically, the trials being run today follow a 100/80/100 model where employees receive 100% of their pay for working 80% of the time in exchange for 100% of their five-day week productivity level.

Welcome to Utopia?

The arguments in favour of a four-day week are, on the face of it, compelling, if perhaps altruistic. As people reassess the role of work in their lives, four-day weeks promise increased work-life balance with more time for leisure activities, life admin and errands, and rest and recovery before the next working week. This increasingly rested workforce is less stressed, happier, more productive and healthier, with fewer sick days taken. Trials have also shown that a reduced working week results in increased job satisfaction and company loyalty.

Beyond individual employees, and similar to remote or hybrid working, a four-day week can reduce office energy use and other operating costs, as well as contribute to a reduced carbon footprint and less traffic congestion. All of this ticks a lot of boxes and makes me wonder why we have not done this years ago.

On the other hand, several of the recent trials referenced have not been extended. Reasons for returning to a five-day status quo included customer satisfaction being negatively impacted, and additional staff needing to be hired to fill in the gaps – driving costs up. So it is clear that four-day weeks are not an automatic ticket to Utopia and certainly don’t suit all industries or even all roles within some industries.

The naysayers’ view

For argument’s sake, let’s swap hats and look at the 100/80/100 model from the perspective of the naysayers, easily pigeonholed as conservative and resistant to change. From this point of view, we need to somehow square the four-day week productivity circle. On the one hand, we’ve got the desire to improve employee work-life balance, and on the other, there is the need to run a business profitably and sustainably.

The productivity conundrum

Let’s look at the numbers. The 100/80/100 model is implying that employees are currently being unproductive for 25% of their time. This makes it sound like these businesses are running far short of optimal productivity. Given the rough two years we’ve just experienced, if the workforce is suggesting this is the case, management may well feel more than a little aggrieved. 

But let’s carry on. The proposition is that employees will work 20% less for the same salaries, if they can match their five-day output in four days. One has to ask, is this level of work sustainable? It feels a bit pie-in-the-sky to think these productivity gains will just come. As it is, in one four-day week trial, 72% of participants said they needed to work longer hours to get all their work done – somewhat nullifying the work-life balance and reduced stress benefits that the four-day week promised. 

It is probably realistic to assume that we will revert to current productivity levels, in due course. How then are we going to achieve 100% productivity in the long term? The only answer lies in technology or increased headcount, and that will depend on the industry, but both will mean increased costs. 

What about revenue?

Then, if we assume that productivity correlates with revenue, a 20% drop in productivity will result in a 20% drop in revenue. Yet at the same time businesses are required to continue paying 100% of the salary cost. In other words, the business needs to generate 25% more revenue just to stand still. Without increased productivity, this can only be achieved through price increases. Failing that, we will start to see an increase in business closures. 

The naysayers might be onto something after all.

Five-days-a-week customers

Another factor to consider is your customer. Presumably they are expecting you to be there when they need you, five days a week. If their account manager is only working four days what happens on the fifth? Customers will understand if an account manager is off sick or on annual leave. But they are unlikely to be too happy about them being permanently unavailable one day a week. And having two account managers per customer is neither effective nor efficient. 

Do we need better directions to Utopia?

It certainly seems that a four-day week needs to be carefully considered, the actual numbers crunched, and appropriate changes made to how we work to have any hope of success – you don’t just flick a switch overnight. Further, I don’t think there is a one-size-fits-all model: for instance, many of the trials seem to have all employees working on the same four days, when surely a staggered approach would be more practical, maintain service levels and reduce office overheads. 

And there is no doubt that a key driver of the success of the four-day week is correctly implemented technology and changes in how we work to fully realise the benefits of this technology. Using automation to speed up manual processes, chatbots (that actually answer your question) to fill in gaps in customer service, or artificial intelligence and machine learning to speed up data analysis and decision-making are some of the advances that will unlock the success of the four-day week. 

We are certainly due a reset in how we structure the working week. It was a century ago that we moved from six days to five. But, as with remote and hybrid working, the devil is in the detail and companies need to think carefully about how they shift their workplace culture, the processes and support structures they need to put in place, and the technology needed to maintain, and increase, productivity sustainably.


Replies (7)

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paddle steamer
31st Aug 2022 13:51

Will only reduce energy costs if all staff work the same four days (in the office) otherwise you will heat the office for five days with fewer people in working on each day.

Whilst I only work three days I can at least be called if problems when I am not in the office and we are staffed 4 days a week 9.00-5.30 and 1 day a week 9.00-5.00, tenants, suppliers, contractors etc can visit, collect keys etc.

If my personal experience of dealing with those working flexi time is anything to go by (Edinburgh District Council, are you listening) all these things seem to do is make the client (Ratepayer/Taxpayer) take the pain.

Thanks (2)
By Winnie Wiggleroom
31st Aug 2022 14:30

An interesting article. It does of course depend on the type of work that you do.

In my particular business, employees are given complete free reign to work when and where they want, but they all understand that there are deadlines that must be met and they also understand that questions from clients or other staff are to be dealt with as urgently as possible.

There are times in the year when the work would not be done if they only worked 4 days whereas at other times 2/3 days might be enough for them.

But we are a small team that have worked together for years and that fully trust one another, and we are also in a business where we (no longer) need someone to be in an office for 5 days a week for clients to call in at their convenience.

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By lionofludesch
31st Aug 2022 15:41

"The 100/80/100 model is implying that employees are currently being unproductive for 25% of their time. "

Indeed. If the four day week works, the employer would be justified in drawing on of two conclusions. Either his workforce is bone idle or the quality of the four-day week work is suffering because it's being skimped.

Judging by what's being filed at Companies House, probably the latter.

Thanks (4)
Replying to lionofludesch:
By Paul Crowley
31st Aug 2022 22:45

"The 100/80/100 model is implying that employees are currently being unproductive for 25% of their time. "

And if it can be done once, surely it can be done several times
Driving schools and restaurants?
Just stop working one day a week and the same money comes in

Maybe this is the HMRC view on why MTD ITSA can so easily be coped with for just the cost of a free software package

Thanks (3)
By tedbuck
01st Sep 2022 11:43

I have recently gone onto a 4 day week. The work load remains much the same so I just work harder for the 4 days than I would have done for 5 days. So more stress and by the 5th day I need a rest so don't see much benefit - also have to catch up at home on stuff that has been left due to pressure of work.

Personally don't rate the idea but it may suit some. Could only work if business allows it and presumably some would work some days and others different days. It seems to me that however it is done disruption will be the result and how many people are going to want to live on 4/5ths of their salary? Or isn't that thought in the computation?

If it isn't part of the thinking I can foresee big problems arising as profitability which isn't too bright by and large anyway especially after the Covid business would automatically reduce by the equivalent of 1/5 of the wages bill as more staff recruited to fill the physical gaps.

And, of course, with an extra day off people will need extra cash to spend so another hole in the finances of the individual.

A bit like wfh - unseen consequences such as an energy cost rise hitting in the winter shoving people back into the office to stay warm. Not to mention the mental stress of no human contact, no training on the job and much reduced interaction with the world.

Just think, all these businesses could become like HMRC but because they are dealing with real customers the customers can go elsewhere rather than be messed about by the little Gods at HMRC

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By North East Accountant
02nd Sep 2022 11:49

The 4 day week for 100% pay is working the public sector.

Of course it's not official but I know of a good few public sector workers who do all sorts of non-work things on a Friday whilst they are supposedly WFH.

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By coops456
06th Sep 2022 11:44

We don't open on Fridays except by prior arrangement for specific clients (usually month end). As a payroll bureau, we figure that if your wages aren't done by close of business Thursday, your staff aren't going to get paid on time anyway :-)

We took stock after being crushed by the volume and intensity of work during the furlough scheme. The change has made a world of difference to our quality of life, and we've had no pushback from clients or the accountancy practices we work with.

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