During the second half of 2022, 2,900 workers across 61 companies in the UK took part in a trial that involved reducing to a standard four-day working week. While it was implemented in slightly different ways by the businesses taking part, they all maintained staff wages at 100 per cent of a five-day week salary.
Although there has been a lot of positive feedback from those companies that took part in the trial, in the public sector the direction of travel seems different. On 26 October 2023, the UK government issued a publication in which it stated that local authorities should immediately cease any trials they are conducting on a four-day working week, as it is believed that reducing a local authority’s potential capacity by 20 per cent does not offer value for money for taxpayers.
How does it work?
The typical model involves reducing the working week to 32 hours worked over four days, so eight hours per day. The key is that there should be no corresponding reduction in pay. However, many more employers already allow what is known as ‘compressed hours’, where a member of staff works full-time hours (35, 37.5 or 40, for example) over a four-day period, rather than five days. In the trial, some companies adopted a ‘Friday off’ approach, some staggered the day off so that there was full coverage across the working week and some adopted an annualised approach.
What did the trial involve?
Companies participating in the trial received training and mentoring from businesses and experts who have experience of successfully implementing a four-day week. A team of academics and researchers worked with participating businesses to agree what metrics would be set to measure success. They then measured impact on productivity to help determine the effectiveness of the trial for each participating company.
What were the key findings from the trial?
It is perhaps easiest to answer that by looking at the results, which were:
Of the 61 companies that took part, 56 are continuing with the trial, with many of them extending it, and 18 companies permanently changing to a four-day week.
Of the 2,900 employees in the trial, 71 per cent reported feeling reduced levels of burnout.
Revenues of the companies involved rose on average by 1.4 per cent during the trial.
There was a 65 per cent reduction in the number of sick days during the trial.
The number of staff leaving the participating companies dropped by 57 per cent during the trial period.
Many other organisations across the UK are conducting their own trials. Online bank Atom Bank saw a 500 per cent increase in job applications almost immediately after it announced it was introducing a four-day week for its 430 staff.
Is it here to stay?
It seems it is. As with all these things, it will not work for every organisation. In the service industry, where meeting client demands is critical in achieving a competitive advantage, it may be harder to make it work. In 2019, science research foundation Wellcome Trust scrapped its plans for a four-day working week trial as it found it “too operationally complex” to make it work for its 800 head office-based staff.
Across the globe, there is growing support for the four-day week. Japan seems to be leading the way with research showing that 8.5 per cent of 4,000 companies surveyed were giving staff more than two days off a week. Companies including clothing chain Uniqlo, Hitachi and Panasonic have all conducted successful trials. Global consumer giant Unilever had such a successful trial for its staff in New Zealand that it extended it to its employees in Australia.
As employers continue to fight to attract and retain the best people, and with workers increasingly seeing wellbeing as their number one priority, businesses must look at all options available to them. While it will not be right for many companies, we do expect to see a growing movement towards a four-day week model over the coming years, both in the UK and overseas.
Greg Burgess is a partner at DMH Stallard