Australia and New Zealand Get Feet Wet in 4-day Work Week Trial

Post-pandemic times have seen workers develop an appetite for a four-day work week. Defne Kucukmustafa/Unsplash

Australia and New Zealand have kicked off a pilot program where workers get an extra day off per week with no reduction in pay, as the idea of a four-day work week continues to gain popularity.

The program, involving some 20 companies from industries ranging from finance to fashion, is based on the 100-80-100 model, meaning workers get 100 percent of the pay, for 80 percent of the time, in exchange for a commitment to maintaining at least 100 percent of the output.

UNSW Business school management professor Karin Sanders said that while a five-day work week is still the status quo in Australia, the concept is gaining global acceptance.

“There is a huge incentive for a four-day work week in hospitals in Scandinavian countries like Sweden, Finland, and Norway, where they treat it like a mental health issue,” Sanders explained.

“Workers need more time to spend on caring responsibilities, for example.”

It is common for parents to work part-time in countries like the Netherlands, allowing more time to be spent with their children, do hobbies, and complete household chores while experiencing less stress.

North American employees in the trial report less stress and burnout, better physical and mental health, and better and more sleep. Nate Johnston/Unsplash

Research has shown that adopting a four-day work week can improve productivity and profits. For example, one trial in Iceland found that productivity remained the same or improved in most workplaces, and eventually, 2,500 workers from the Iceland government took part as well.

Another study involving a Canadian law firm increased its profits by over 30 percent in three months following a switch to a four-day work week without a pay cut.

Interestingly, workers preferred to take Wednesdays instead of Fridays off, finding that a midweek break was the most beneficial for their wellbeing.

Not a One-Size-Fits-All

The success of the model will depend on the type of work and industry, as not all business models can do a four-day work week.

For example, a knowledge worker such as a web designer, accountant, and researcher may find it much easier to change their working hours than someone in construction, education, and hospitality.

“If you work in a hospital, you work with patients for a four-day work week,” Sanders said.

“But for instance, if we in academia work just four days but with the same amount of research targets and teaching expectations, then we might feel more strained.”

Although the four-day work week may sound attractive, it likely isn’t the magic fix to the work-life balance that workers dream about, CEO of Infrascale Russell Reeder says.

“It’s not realistic to think if everyone had an extra day off, they'd achieve work-life balance or be able to get all their chores done on their day off,” he said.

“Companies need to create cultures in which employees can take care of the little things that happen daily.”

There’s also a possibility that employers may demand more dedication during the four days, ironically creating more stress.

“If you try to fit in 35 hours of work in four days and keep the same productivity and targets, some people will need to work harder and might get overworked with increasing numbers of burnout over those four days,” Sanders said.

AI and automation technology may soon replace the workforce across the world. Geralt/Pixabay

Companies may also be pushed to speed up technological developments to accomplish the same amount of work in less time, such as through artificial intelligence (AI) technology, chatbots, and robot coworkers.

Consequently, more studies need to be done on the impact of AI in the workplace and the industries most vulnerable to automation to address the changes that may arise if technology exceeds the capabilities of human employees.

Company’s Own Decision

Jason Clemons, the executive vice-president of the Fraser Institute, said policy intervention such as a four-day work week could exacerbate the situation for some businesses.

“Government regulation could easily make things worse since it would almost inevitably treat all firms the same when the reality is that many firms are in sectors where a four-day work week simply won’t make sense,” he said.

Economist at the Macdonald-Laurier Institute Philip Cross agrees, saying it should be up to those running the businesses to decide what they should do.

“If a four-day work week is so obviously beneficial to employers and employees, I would expect them to adopt one on their own without the government’s direction,” Cross said in an interview.

“If they are resisting, it is for a reason, and the government should not be imposing another layer of regulation and cost on people already struggling.”

The Australia and New Zealand Banking Group’s pilot study is run by 4 Day Week Global, a large-scale non-profit involving business leaders, community strategists, work designers, and advocacy thought leaders.

They have been organising the trials for the past couple of years around the world, including in North America and the UK.