Four-day week – how it could boost your small business

Originally written by Anna Jordan on Small Business

In recent weeks, you may have heard the four-day week debate bubbling up again, especially now that Covid-19 has changed the way that a lot of us work.

Though it doesn’t have any focused government support, businesses across the UK have trialled and implemented the four-day week. The Scottish National Party (SNP) has pledged that if they get re-elected, they’ll create a £10m fund for small businesses so that they can trial a four-day working week.

>See also: Scotland election manifestos 2021 – what’s in them for small businesses?

It’s not just in the UK, either. Spain is seriously considering the four-day working week. It has proposed a ‘modest’ pilot project for companies. Details will be hashed out in the coming weeks, but the pilot could begin as early as the autumn. The Más País party hopes that the trial will emulate the results of Software Desol, the first firm in the country to implement a four-day working week. In fact, it’d be the first nationwide trial anywhere in the world.

According to Be the Business’ second productivity index, more than half of businesses are either implementing or open to operating a four-day week. One in 20 micro and small businesses that did a five-day week have switched to a shorter week. A further 17 per cent are actually considering it and 29 per cent will consider the idea in future.

Companies run by younger owner-managers are more open to the idea, as are businesses with 50 or more employees. Companies who have seen growth in their bottom line in the past three years are more open to the idea too.

We’ll be looking at the pros and cons and the practicalities of implementing a four-day working week in your business.

How does the four-day working week operate?

The idea of a four-day working week is a reduction in hours to reflect the smaller number of days. Some argue that this structure could work as the same number of hours done over fewer days. This is known as a compressed week.

For the purposes of this article, the week must be reduced to 32 hours – eight hours over four days – with the same pay. It’s more of a transition than a switch. “It’s very much about working time reduction. We’re also talking about a transition towards shorter hours, not an overnight change,” said Aidan Harper, researcher at the New Economics Foundation.

“The way I’ve seen people ‘fail’ in implementing a four-day week is when it hasn’t really been a true reduction in working hours. And they’ve tried to squeeze all their work hours into it, so that ends up messing with people’s childcare routines and leads to exhaustion in the week.”

The extra ‘day off’ is where there is more flexibility. Businesses could opt for a blanket day off for all of their staff – say they have a Friday off and have a longer weekend – or they could take a day mid-week. Others let staff choose which day they’d like to take off and organise their operations around that. The business remains open Monday-Friday.

What are the benefits of a 4-day working week?

Some who have trialled and implemented a four-day working week have revered the change for a number of reasons, so let’s break them down.

Productivity

Productivity is one of the first – and most compelling – reasons that companies make the transition.

When looking at this table from Time, Norway, Demark and the Netherlands are productive countries with working hours of around 27 hours apiece. Japan rates at 20 out of 35, despite working notoriously long hours.

Microsoft Japan tried the four-day working week and productivity went off 40 per cent, New Zealand-based Perpetual Garden had an increase of 20 per cent and UK-based MRL Recruitment said their trial increased productivity by 25 per cent.

Happier employees

Research from Henley Business School indicates that staff at businesses with a four-day week are 78 per cent happier and 62 per cent took fewer sick days.

It also decreases stress levels. Staff at Perpetual Guardian reported a 7 per cent decrease in stress after moving to a four-day week.

More workforce inclusive

Having more flexible working practices gives opportunities to potential employees with caring and other responsibilities.

What’s more, it could help to lead the way for greater gender equality. “History is also determined by the idea of male breadwinner in the factory in the 1950s. The working week evolved out of that. That was when the working week itself was informed by a very patriarchal, outdated, outmoded style of work. We’ve moved beyond that,” said Harper.

“Part-time work is overwhelmingly likely to be low, paid, insecure and offer few opportunities for advancement. And you’d often get people who are overqualified doing roles. So if an organisation wants to attract these people to make it fairer, they need to be open to opening up making part-time a new full-time to remove this bottleneck of talent into the organisations.”

Improves staff recruitment and retention

Flexible working could improve staff retention and attract new talent. Not only will it be more appealing to employees who want flexible working, but it’s a great perk for people who want to pursue a separate passion.

A study from TopCV revealed that almost one-third of UK jobseekers rank a four-day working week as their top priority for their next role. This was closely followed by a total change of career or industry (29 per cent) and an organisation committed to equality, diversity and inclusion (19 per cent).

Discussing the findings, Amanda Augustine, careers expert at TopCV, commented: ‘The events over the past year have prompted many professionals to re-evaluate their priorities, particularly when it comes to their career and the type of organisation they want to work for.”

Keeping employees on for longer saves you a lot of time and money in recruiting and onboarding new staff.

More environmentally friendly

Due to less power being used in workplaces and fewer emissions from commuting, a four-day working could lead to a smaller carbon footprint. The 2,063 respondents in Henley Business School’s research estimated that they would drive 588m miles less per week if it was reduced to four working days.

Spending more time at work and a generally faster-paced mindset can result in a higher consumption lifestyle, as Harper explains. “For example, it can mean driving instead of walking or cycling, or having a rushed, frozen, energy-intensive meal put in microwave, rather than cooking with homemade ingredients.”

What about the disadvantages?

However, it’s best to think of your businesses needs before you go ahead.

Customers/clients may not like the change and go with a competitor

If you go for the blanket ‘day off’ approach and close your business for an extra day, customers may not realise that they can’t get hold of you that day. If their enquiry is urgent or they get annoyed that you’re not available, they may go to someone else.

It’s not suitable for every business 

Some businesses aren’t suited to the four-day working week. You’ll need the right support, technology and workplace culture in order for it to be a success. This could involve spending extra money on automation, outsourcing and/or HR platforms.

London’s Wellcome Trust decided to scrap its trial because it was ‘too operationally complex to implement’ for its 800 staff.

Treehouse, an HR firm in the US, dropped its four-day week as it was struggling to keep up with competitors.

What’s more, the earlier research from Henley Business School shows that 45 per cent of workers would worry about being perceived as lazy by colleagues and over a third (35 per cent) would be concerned if they had to hand over their work to colleagues.

>See also: Is a four day working week really a boon for productivity and staff wellbeing?

Operations may be difficult if you have different working structures going on

If everybody’s days off are on different days, then some may feel pressure to work on ‘off days’ due to different schedules. Even if they don’t, not having staff in may disturb deadlines.

“If you change one person’s routine, you may find that it has an impact on another team. There may not have been a realisation about the interconnectivity within a workplace between teams and individuals and the knock-on effects of that,” said Harper.

Not cost-effective

A paper by Jethro Elsden, data analyst at the Centre for Policy Studies, shows that a four-day week would be costly for the economy. Based on current productivity levels, the measure would cost £45bn. Even with ‘generous’ productivity gains, estimates suggest that it would still cost £17bn.

Companies that have implemented the 4-day working week

This is all fine in theory, but it’s more useful to hear the experiences of businesses that have tried it themselves. That’s why we asked three businesses how the four-day working week is going for them.

Ffyona Dawber, CEO of Synergy Vision, talks about why she moved the medical comms business to a four-day model and how the company has done it.

What made you consider the four-day working week?

Well, I’d read some stuff on it in, I think it was Scandinavia, they were doing it. I put it to the board, I thought maybe this is something they’d be interested in. I must admit, when I put it to the board, I thought they’d say no way.

At that point, we were doing a 40-hour week, and they talked about reducing it to 37.5 hours. I said, ‘Well, how about we reduce it further and do it over four days?’ Amazingly, everyone said, ‘Wow, that sounds really interesting. Why don’t we look at that?’ So we decided to do it on a trial.

My husband is Dutch. In Holland, they have a – it’s not formal – they often have a ‘daddy day’ or ‘papa day’ which is usually a Friday when the dads pick the kids up from school, because they’re not working five days a week. I thought, ‘This seems like a nice culture, a nice way to do it’.

How did it start?

When we started it, we did a trial. The surveys were very positive that people were finding they were able to do now. We thought we’d ask people in the surveys what they would do with their non-working day. And they all initially said they’ll start a hobby or go play golf or tennis or something like that. The reality of what actually happened is people did a lot of life admin on their normal working day, but it meant then their weekends were free to other stuff. Yeah, so it wasn’t as exciting in the surveys as we thought it was going to be, but people loved it.

Nobody wanted to turn back, everyone said they were happier. We did a happiness index. We did a work life balance index, people felt that where work wasn’t interfering as much on their personal life as it had done previously and vice versa. So it felt like the balance was right.

You’ve even had a Masterchef contestant (Jasmeet Dial) in the company!

That’s why he did it, because they did two days of filming a week. He did one of the days of filming on a non-working day.

How does it work – does everyone have the same day off?

We did talk about how to do this. Do we as a company of about 50 people at the time, do we say that, ‘Such and such has to have this day off and such and such has to have this day off’, because we’re still open five days a week, and clients need to be able to contact us five days a week.

We needed to be sure that each project would cover five days a week, so you wouldn’t have everyone from our project team taking Friday off. So we talked about whether we should mandate which days and then it felt like a logistical nightmare, you know, to try and work out who was working on what, what clients worked, and it just seemed like a nightmare.

What we ended up doing was we put it to the team. Instead, you’ve got to decide amongst yourselves what days you’re having off. So obviously, everyone can’t always have Friday off. So you’ve got two people in a team. And they both like to have a Friday off. Fridays, Mondays and Wednesdays are definitely the most popular days.

‘Nobody wanted to turn back, everyone said they were happier’

So we left it up to everyone to do themselves because we didn’t have to sort out the logistics.

How have you managed different days off?

We actually had to go with an external HR system. And I’m so glad we did. For the first two months of the trial, we didn’t have the system – we used Excel, and that was really hard.

The way that we had to do that was for holidays and bank holidays, we had to count hours instead of days. Well, it’s not your standard five day working week, which is what the HR system was set up for.

Have you seen people feel pressure to work on their ‘off’ days?

Some would have to work on their ‘off’ days but it was very rare. We normally book it a month in advance. So we try and get the calendar up to date a month beforehand.

We did a lot of conferences for clients and that kind of thing. So conferences usually run over a Friday, Saturday, Sunday. They tend to be at the weekend to get the maximum number of people. And in those cases, people would have to work. And if they had a client meeting on a Friday, so they had to work a normal week or even over the weekend, what we do is let them take the extra days back in lieu within a month, so they could take it back. But it was rare that that happens, to be honest. Normally what people would do is, if they were flying on Thursday, they take the Wednesday off just to get stuff done.

If we had the flexibility to allow it, if you weren’t able to take it one day, you could take it within the next month. And we said ‘within the next month’, because what you don’t want is people just keep working five days and keep working five days, you want them to use up the time off to get the break.

How did clients respond to the move?

Most of them were receptive. We had probably one or two I can think of – one in particular – who didn’t like the idea. The first couple of weeks he was phoning up every single day of the week to give a little bit more information on what he wanted done on a project, we felt like he was just testing to check it was the five days a week, but that settled down after a month as well and he got used to it.

All the other clients loved it. And it was one of the big pharma companies who came to us and said, ‘This is amazing, we’d love to look at doing it.’

Are there any sectors where you feel this model wouldn’t work?

I think if you’re working with clients, or working externally, in the world where they have a five-day working week, you do need someone to cover stuff the five days.

If you’ve got five or more people, you might be able to make it work. The problem then comes that we had at the time, our design team was only two people (it’s five now), but at the time, it was quite small. When you’ve only got two people in one team, it becomes a problem when one of them goes on holiday because, of course, you still have normal holidays. So ,if one goes on holiday, and then the other one’s still doing a four-day working week, you’ve got one day a week when there’s nobody there. So in that case, we have to get a freelancer in. We know in advance when the holidays were booked and we get a freelancer in a couple of Fridays or the Monday when the other person was going to be off.

I suppose there are extra problems there with resource and a smaller business may not having the cash flow to be able to negotiate that.

Yeah, I think it would be a bit difficult. I think once you’ve got more than five or ten people, it’s doable, but below that it might be hard unless you’ve got very understanding clients or you work in an industry where actually it’s okay to say you don’t open on a Friday.

I think they work in most areas. I worked in the NHS for years, and people have said to me, ‘Oh, it wouldn’t work in something like the NHS’. I think I absolutely would. And you know, when I was a nurse there, we did 12-hour shifts, and you do three days on three days off, or three days on four days off, which effectively you can actually make any shift at work, if you’ve got the logistics and you’re able to plan out even in the evening, something that needs to be 24/7 like the NHS, you can make a shift pattern work as long as you’ve got the overlap and you’ve got the cover.

How has Covid-19 affected the company’s working structure?

I suppose the only thing I want to say is you have to push people to take their day off, because when you’re just stuck at home, you’re quite inclined to just check your emails anyway, which is really not healthy for any of us.

I hear anecdotally from other people and other companies that people are doing that. It’s hard. I’m sitting in my living room right now. It’s hard to separate that life and work. I know, because the TV’s over there, and I’m watching TV in the evening, and my computer is just here.

They found it hard to have that separation between work and life. And we haven’t actually done a survey for a while, because we’re so into the four-day working week. It would be interesting – maybe I should ask to do this, to see how people’s work life balances are now they’re stuck at home.

What do you think is in the future for the four-day working week?

There’s going to be fewer jobs and by having a four-day working week, you can have a more even distribution of employment. So I think from that social economic reason, it might be a reason to do it. Whether we’ll need to do that in the UK or not, I don’t know, but I think it makes sense for a country like Spain where their unemployment rate is near 20 per cent, or something like that.

The four-day working route is really appealing to people. That’s held. And the same with retention as well. I think if someone wanted to leave, they would leave regardless. What I’ve heard from people who’ve left, I’ve kept in touch with them, they’ve actually negotiated and continued to do four days. Even though the whole company hasn’t changed, they’ve gone in and said, ‘Well, if you want me, I want to stay on my four-day working week.’ So they they’ve managed, which is brilliant. It’s pouring into the companies under the radar.

I have to say, when we converted to the four-day working week, there were two people out of 50 at the time who didn’t want to do it. They stayed on a five-day working week and had the routine. They were both parents and their reasoning was that they liked the routine of getting the kids off to school.

When we introduced the four-day working week, there were a lot fewer sick days, which was great. It shows that people may be just getting the rest they need, whether it’s physical or mental sickness, having that day to just rest.

Daan Dohmen and Anne Pasdeloup, founder and people lead link at Dutch healthtech firm, Luscii, talk about their current trial of the four-day working week.

Why did you decide to do this trial now?

Anne: We were thinking about ways, other than holiday, to let people have the freedom to spend their time the way they want to. We saw on Twitter one morning that there was a company that was doing a four-day work week. We thought maybe that’s the solution for us as well. And we said, ‘Okay, just take one day to be creative, think about other stuff’, instead of just going through that rat race, Monday to Friday, weekends and a Monday to Friday again, just give them some creative time. As long as productivity doesn’t diminish, then maybe that’s really it.

We’re about seven weeks into the ten-week trial (at the time of interviewing).

How is it going so far?

Anne: It’s actually the developers who are really, really happy. I’ve never seen happiness as high as now for developers. Our sales department feel a little bit more stressed because they feel like they cannot see customers who want to talk on Fridays.

How much money have you spent doing the trial?

Anne: Currently none. But if we do continue to trial, there will be some cost in that the people that now work part-time need to go to a full-time contract.

Basically, everyone will get a 20 per cent pay rise either in days off or an actual pay rise because they had a part-time contract.

How will you measure the success of this trial?

Anne: We’ve said happiness needs to go up. Productivity for each team needs to say the same, at least not go down. That’s a pretty good baseline to see if anything changes.

I’m monitoring staff by asking, ‘How are you doing? How stressed are you?’ Currently we only have 44 employees so it’s still really easy to communicate. And of course, everyone needs to agree with the changes and that we’re doing this.

Sick days are one of the things that we will look at also, in the end. I guess that is indeed the idea that also because you’ve taken more time for you so you feel healthier.

Daan: If there any companies or organisations big or small, wherever in the world, then we will always be more than happy to provide information or set up a Zoom call in order to let others also learn what we’ve learned.

Jess Morgan, founder of Carnsight Communications, started off her business with a reduced working week.

Why did you decide to start your business with a shorter working week?

Interestingly, when I spoke to recruiters and I wasn’t sure of my next step, I talked about moving elsewhere on a four-day and they said it was unheard of at the time, which is crazy. That must have been about six or seven years ago. Basically, you had to be in a company for five working days, and then you had to prove your worth to move to four days.

I guess the other key thing at the time was that it was a really for parents. If you were a person who didn’t have children, you didn’t really feel like there was a good enough reason.

‘I talked about moving elsewhere on a four-day and recruiters said it was unheard of at the time’

I took people on for a certain number of days or hours, I wasn’t taking on five-day salaries straight away. We could be a building block for new companies and work up gradually. So, it was like a lifestyle, and maximising productivity. I thought, well, actually, I can tap into people for a certain number of hours or days and build up the business.

I can’t compete with corporates on salaries, but my aim is for people who work flexibly to be rewarded. So for example, in a four-day working week at my company, you’ll be rewarded the same as a five-day working week at a company of a similar size. Everyone’s very grown up and trusted. But we get so much done, we’ve got the right amount of clients.

For me the model is working really well if I can reward people working four days with a five-day traditional salary.

Where did you find your employees?

I employed my first member of staff as an intern, and she was still at university. She was in her final year of university and looking for a placement. So that was ideal. We met randomly on Twitter, but it turned out she was looking for a placement. My second employee, who’s still with me, she’s studying a Master’s. So she was another person that knew she only needed certain days right from the start. When she finishes, she’s actually going to go up to four days. My third employee was a parent and was had had a child not at school, I will have a child that not at school age, yes, I was looking for a job that would allow her to spend some time with him as well. My fourth employee is another intern. She is currently doing a range of placements.

I’m really passionate about my job, but I’m not unrealistic. I know that people have got lives outside. So if you’re doing something you’re you’re passionate about in your day when you’re not working with me, then I think that’s a real benefit.

How do these working structures affect holiday allowance?

The holiday allowance does take into account that the staff are only working a certain number of days, because I’ve done it through an HR company.

Read more

What small businesses think of the four-day working week

Four-day week – how it could boost your small business

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