From June to December 2022, 61 companies (across a range of sectors, from charities to retail) and nearly 3,000 workers took part in a six-month trial of a four-day working week. The trial ran on the 100:80:100 model: 100 per cent of pay for 80 per cent of the time, in exchange for a commitment to maintain 100 per cent productivity.
The four-day work week isn’t a compressed work schedule (whereby employees work, for example, 35 hours over four days instead of five), but rather reduced hours. So, the employees worked around 28 hours over four days and had a three-day weekend (or a different day off) but received full-time pay. For further background on the four-day working week, see Katie Fudakowski’s article here.
In February 2023, the report into the trial was published and the results are now in.
The headline findings from the trial are as follows:
- 56 out of 61 companies (92 per cent) are continuing with the four-day week, with 18 companies confirming the policy is now a permanent change.
- Employee retention improved at participating companies, with the number of staff departures dropping by 57 per cent over the trial period.
- Companies’ revenue stayed mostly the same throughout the trial period. It is reported to have risen “by 1.4 per cent on average, weighted by company size, across respondent organisations. When compared to a similar period from previous years, organisations reported revenue increases of 35 per cent on average”.
- Employees reported personal benefits, with 39 per cent saying they were less stressed when compared before and after the trial, and 71 per cent reporting reduced levels of burnout.
- 54 per cent of employees said it was “easier to balance their work with both family and social commitments” and were also “more satisfied with their household finances, relationships and how their time was being managed”.
- 60 per cent of employees found an increased ability to combine paid work with care responsibilities.
In some companies, the trial was so popular that 15 per cent of employees said that “no amount of money would induce them to accept a five-day schedule over the four-day week to which they were now accustomed”.
How have the findings been received?
It is clear that, from the employees’ perspective, the four-day working week has improved their wellbeing and enabled them to balance their work with different commitments, while maintaining similar levels of productivity and pay. Employers also seem not to have taken the "hit" to revenue that was predicted by some.
Despite the positive results and calls from some to make economic growth a key priority for the coming years, the UK Government has not yet shown much enthusiasm for adopting the four-day working week as policy. One conservative peer even said that the policy would have a “devastating effect”, claiming that it would be “difficult for colleagues to work effectively if some are just not available for 20 per cent of the time”.
However, some big companies are seeing the benefits of this trial. Sainsbury’s, the UK’s second largest supermarket, recently said it would trial offering the four-day week to some employees at its head offices, warehouses and to some store managers in order to improve flexibility for its staff and allow them to work more efficiently (although, significantly, they will be required to work compressed hours).
What happens next?
It may well be the case that the four-day working week suits some industries more than others, and there continues to be scepticism from many on the practicalities of such a policy being introduced on a large scale.
However, the UK’s 4 Day Week Campaign group continues to argue that the policy will be the vanguard of a major shift towards a new age of working. They also argue that companies who decide to adopt this will see increased productivity and find it easier to attract and retain employees, especially in light of the "Great Resignation" (explained in Alice Kendle’s article here).
From an employment law perspective, employers adopting the four-day working week will need to consider how they deal with large-scale contractual variation. Implementing the four-day working week could affect multiple areas of the contract in addition to clauses covering working hours, and employers will need to ensure they follow an appropriate process (for more on changing terms and conditions, see my previous blog here). That said, if employees are keen to adopt a four-day working week then employers may not see much resistance to these changes.
Employers deciding to allow a four-day week for full pay will also need to be conscious of the risk of potential discrimination claims. For example, claims could be brought by existing part-time workers, who may argue they suffer a detriment if colleagues are entitled to work the same hours as them for more pay. In that context, and given that the majority of part-time workers remain women, an employer may risk indirect discrimination or equal pay claims, depending on how the changes are planned and implemented. There could also be potential indirect discrimination claims, for example if employers seek to designate a particular day a non-working day, and some employees have a need to take a different day off for religious reasons or as part of caring responsibilities.
For now, we wait to see if more employers will follow suit and how the concept of the four-day working week will develop going forward.
With many thanks to Emmeline Downer, a current trainee in the Employment team, for her help with preparing this blog.
If you require further information about anything covered in this blog, please contact Emily Part, or your usual contact at the firm on +44 (0)20 3375 7000.
This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.
© Farrer & Co LLP, March 2023