Talent [R]evolution

4-day workweek companies: The good, the bad, and the alternatives

Reading Time: 7 minutes

Productivity is the word on every company’s lips. Now more than ever, organisations need to meet rising demand and get the most out of their resources. However, in a time of tumult, one thing hasn’t changed – our most important resource is still talent. In light of the conditions, how can we get the most out of our people? Paradoxically, it seems that asking them to work less to do more could be the answer – and with the 4-day workweek companies are seeing results.

At TRech International, we always look at ways that businesses and talent alike can unlock their potential. That’s why we’ve taken an interest in 4-day week companies, measuring their performance against their traditional counterparts and considering alternatives. The data that’s out there is certainly compelling and rich food for thought for recruiters. 

Social scientists, management experts and psychologists have quantified the 4-day workweek theory in a slew of extensive studies. The most prominent report, conducted by advocacy group 4 Day Week Global and associates from various leading universities, suggested that reducing working days without cutting pay reduces stress and sick days, and promotes employee retention.

These possibilities are certainly intriguing, but there is another side to the coin. The benefits aren’t applicable in every industry or workplace format, with a small number of participants finding the 4-day workweek untenable. There are, however, alternative schemes to support worker well-being and boost productivity. Here, we’ll take a deep dive into the results, weigh up the benefits and propose fresh takes on the 4-day workweek.

Unpacking the benefits of a 4-day workweek

Over the last five years, the 4-day workweek has evolved from an unconventional idea to a mainstream policy embraced by organisations globally. Initially challenging the received wisdom that longer hours equate to higher productivity, the concept of reducing work hours without compromising pay has gained widespread approval. 

Fueled by successful pilot programmes and positive research findings, the 4-day week is now seen as a practical and appealing solution for those seeking an improved work-life balance. Notably, it has shifted from merely desirable to a credible and attainable alternative in the workplace. As support and implementation grow, the prospect of a shorter workweek becomes increasingly feasible across various sectors.

One such pilot was run by 4 Day Work Week Global, future-of-work research agency Autonomy, and social scientists from Boston College and the University of Cambridge. The study, published in 2023, covered 61 British organisations comprising 2,900 employees in consultancy, housing, IT, beauty, recruitment, hospitality, marketing and healthcare. Each organisation committed to a 20% reduction in working hours for all staff for six months, with no reduction in pay. 

Results were quantified by studying administrative data from management and survey data from employees. The study yielded some remarkable findings, with 4-day workweek benefits including reduced stress, fewer sick days, and even a slight increase in revenue.   

  • 71% of employees noted a decrease in feelings of burnout, while 39% reported a reduction in stress levels.
  • Researchers observed a 65% drop in sick days and a 57% decline in staff turnover compared to the previous year.
  • Participating companies reported that overall revenue remained steady, with 23 businesses yielding an average 1.4% increase in revenue.
  • Employee surveys showed enhanced work-life balance, with 60% expressing an improved ability to juggle paid work and caregiving responsibilities, while 62% found it more convenient to integrate work with their social lives.

Many 4-day workweek companies noted the efficiency of workers increased. This was driven by smarter working strategies, including shorter meetings with clearer agendas, interruption-free ‘focus periods’, introducing email etiquette outlines, and implementing end-of-day task lists for efficient handovers.

Meanwhile, during interviews about how they used their additional day off, the predominant response was “life admin” – activities like grocery shopping and household chores. Numerous individuals highlighted that this allocation enabled them to enjoy a genuine break during the weekends, helping them properly recharge.

In the UK pilot program, 92% of participating companies (56 out of 61) expressed their intention to go forward as 4-day workweek companies. Meanwhile, 18 companies confirmed the change was permanent. 

Additional trials conducted by 4 Day Week Global in the US and Ireland, featuring research from several of the same academics, have already disclosed their outcomes. Nevertheless, the UK trial stands out as not only the most extensive to date but also the first to incorporate comprehensive interviews.

Barriers for 4-day workweek companies

So what companies offer 4-day weeks? The diversity across sectors is remarkable, with big names including Scoro, Atom Bank, and Springbok AI joining the ranks of 4-day workweek companies. It seems there are more and more places for talent looking to reap the benefits of the 4-day week – but what about the 8% of firms that weren’t convinced?

Companies that found the shift untenable were largely customer-facing organisations or businesses with more tangible outputs, such as construction and engineering. For instance, in a report compiled by the BBC, an engineering and industrial supplies company reported difficulties, despite tailoring the 4-day week principles to their needs. 

Instead of implementing a 4-day week per se, the Gloucester-based company gave all employees one workday off every two weeks. However, due to the unpredictable nature of customer orders, the reduced headcount has a severe impact. Condensing work days led to greater worker exhaustion, and subsequently, the firm abandoned the trail two months early at its three main sites. In a business where working from home is impossible and hands on deck are everything, the 4-day week wasn’t yielding benefits.

Meanwhile, customer-facing businesses like Citizens Advice in Gateshead, found they would incur extra hiring costs if they implemented a 4-day week. While some employees could work extended hours, like those in roles at the contact centre, face challenges meeting set KPIs within defined opening hours. Flexibility for the third day off is limited, particularly for the busiest days. Subsequently, the centre would need to hire more staff to pick up the slack. 

Citizens Advice extended its 4-day week trial to May 2023, acknowledging the challenges in different business areas. However, the organisation reported that unless targets were met by the contact centre team, the shorter workweek may not become permanent for any part of the organisation, highlighting the complexities that 4-day workweek companies can face.

4 day work week benefits
Driven by smart working strategies, the benefits of a 4-day workweek include feeling less stressed, fewer sick days, and even a slight increase in revenue.

What are the alternatives?

Undoubtedly, the results from the 4 Day Week Global/Cambridge study are compelling. But in an age where agility, flexibility and resilience reign supreme, we know that one size doesn’t fit all. So what are the adaptations or alternatives for those that don’t fit the criteria to become 4-day workweek companies?

There are many ways to tailor the theory to your business, but two alternatives emerge as viable options: unlimited paid time off (PTO) and turning to freelancers. One scenario grants employees full autonomy over their work schedules, while the other takes it completely out of the company’s hands.

Granting greater autonomy with unlimited PTO

A progressive trend in the workplace gaining momentum is the concept of unlimited paid time off. But what does it mean to have unlimited holidays? In contrast to traditional leave policies that allocate a fixed number of days off, unlimited PTO allows employees to take time off as necessary, within reasonable limits and upon mutual agreement. 

Supporters argue that this approach fosters a sense of ownership, empowerment and well-being among employees. Big names have implemented the policy, including Netflix and Roku. Others are quickly following suit, with vacancy listings in the USA offering unlimited PTO jumped 178% between 2015 and 2019. 

This is extremely attractive to top talent, who in a MetLife survey, reported that unlimited PTO was their most highly valued employee benefit. Of the respondents, 72% expressed interest in this perk, ranking it higher than wellness programmes, phased retirement and paid sabbaticals, as well as choosing this perk over 4-day workweek companies.

By eliminating the constraints of a set number of vacation days, individuals feel less pressured to fit their personal lives into a rigid timeframe, resulting in reduced stress and burnout. Consequently, employees return to work rejuvenated, motivated, and with increased focus, leading to enhanced performance and creativity.

However, critics express concerns about potential misuse or imbalances that unlimited vacation policies may bring about. In some cases, employees were taking less holiday than they were entitled to. In a 2017 study, HR platform Namely found that employees with unlimited PTO took just 13 days off per annum, whereas those with a traditional PTO plan averaged 15 days off annually. 

Grant full autonomy with a freelance workforce

Alternatively, businesses can go all in on autonomy and work with freelancers. Freelancers decide when, where, and how much they work, which in turn, promotes greater productivity. This flexibility allows them to tailor their work schedules to peak productivity hours and create an environment conducive to their individual preferences.

For instance, the freedom to choose their work environment influences the quality and quantity of their output. Remote work – a common choice for freelancers – has been shown to drive productivity. A 2021 study by Prodoscore revealed that remote employees experienced a 47% increase in productivity compared to pre-pandemic levels, emphasising the positive impact of choosing one’s workspace on overall work efficiency.

Moreover, freelancers have the liberty to determine the volume of work they undertake. The ability to manage workload according to personal preferences and energy levels contributes to sustained productivity. For example, the Boston Consulting Group found that although freelancers tend to work a lot of hours, they still enjoy a better work-life balance. According to their data, 81% of freelancers said they value freely managing their schedule.

This is reflected in further data that demonstrates once you go freelance, you don’t go back. In the same report, BCG reported that 84% of French and German freelancers wouldn’t go back to traditional employment. Forward-thinking firms are responding; according to research from a firm in Estonia, 48% of Fortune 500 companies hired freelancers in 2022.

Implement the workweek you need and get the right people for you

As we look to the future of work, it’ll be interesting to see whether 4-day workweek companies outperform their full-time counterparts. Cambridge University and 4 Day Work Week Global’s exploration into this paradigm shift reveals compelling data, highlighting benefits like reduced stress, fewer sick days, and even slight revenue increases. 

However, challenges arise in certain industries, exemplified by the experiences of companies outlined here. These nuances underscore the need for tailored solutions and alternatives to achieve an optimal work-life balance and productivity. The 4-day workweek is an intriguing proposal, but it seems that it won’t apply to every sector.

Expanding beyond the 4-day workweek, alternatives like unlimited PTO and embracing a freelance workforce present compelling alternatives. In a time dominated by the importance of adaptability and flexibility, these alternatives offer practical choices for businesses aiming to enhance their workforce efficiency.

If your business could benefit from the dynamism and optimism offered by a freelance workforce, you need to ensure you get the best there is out there. Outvise is a curated platform of verified Business Tech freelancers based all over the world. Click here to create an account and connect with the talent you need. Alternatively, if you’re a freelancer looking for exciting projects or jobs, create your expert account now. The working week you want is just a few clicks away.

Sara is a certified professional with over a decade of experience in Sales, Consultancy, and International Staffing. Throughout her career, she has collaborated with global entities, ranging from startups to industry giants. With a strong leadership background, Sara has risen to managerial roles, highlighting her expertise and commitment. As one of the Founders at TRech International, she serves as the L&D Partner, overseeing training delivery, advisory services, and coaching initiatives.

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