COVER STORY: Leaders open to a four-day work week, but hesitant to implement

More Australian leaders and executives are open to the idea of a four-day work week, however, a number of factors are holding them back from implementing this new way of working. 

A four-day work week gives employees 100 percent of their pay when they work 80 percent of the week. 

Jacqui Walshe, executive chairman at The Walshe Group said from what she has seen there is a willingness to consider the concept – but while a few have trialled and introduced, and others introduced at times of real retention risk – the tradeoffs are still being considered. 

“Would there be a risk in productivity and output? Will the budgetary impacts be sustainable over the medium term (once introduced, it is very challenging to wind back),” she said.

Walshe highlighted some of the hurdles in front of leaders when implementing a four-day work week.

"Financial challenges, concerns over productivity and impact on customers, leadership that is unwilling to test and learn and structural challenges within workforce makeup at a particular organisation which aren’t immediately easy to solve," she said.

But Walshe noted, "As more organisations adopt the practice there will no doubt be more employee-led pressure to make change and at the same time best practice insights from market success stories."

Claudine Ogilvie, non-executive director of Cuscal, and managing director at Ogilvie and Ogilvie Consulting told Digital Nation companies have an open mind about the concept but are sceptical about the practicality and applicability to certain roles and industries.

She said, “It's a 'modus operandi' that should be deployed thoughtfully to achieve the right outcomes.”

Growing curiosity

Robin Boomer, senior director, research and advisory in Gartner’s HR Practice said there is a lot of curiosity around a four-day work week with many organisations looking for evidence and validation to give it a go.

He said, “A number of employers are keenly interested in what others are doing to offer four-day work weeks or are experimenting themselves. We’ve seen an increase in our clients inquiring about how to set up a pilot; what has worked; and how to position a case for trialling four-day working.”

He said those organisations that have tried and succeeded with four-day work weeks have reported increases in productivity or revenue of 38-50 percent.

“For those that haven’t succeeded, it usually isn’t the result of lost productivity, but problems in implementation. Those unsuccessful cite a lack of change management, perceptions of unfairness, and slipping back into 5-day working patterns as the culprits,” he said.

While the leaders are toing and froing bringing in a four-day work week, more employees want to have that flexibility from their employers. 

Gartner’s latest Global Talent Monitor Survey showed more than half of Australian respondents cited a work-life balance and where they work and live as one of the top three most important attributes when evaluating a potential employer.

Boomer noted that this is even more than compensation, which less than 40 percent say is one of their top three attributes.

In terms of a four-day work week impacting productivity, Ogilvie said it depends on the nature of the roles in question.

She highlighted the findings from the recent four-day work week trial in the UK involving 60 companies where it saw a 92 percent success rate. 

She said, “Initial data suggests that the four-day work week doesn't impact productivity, but rather improves overall wellbeing (including physical and mental health) and employee attraction and retention.

“Most interestingly, revenue increased by 8.14 percent for the trial period and 37.55 percent compared to the same six-month period of the previous year. This study provides compelling data and makes a good business case for change and meaningful consideration.”

Those who have implemented a four-day work week

Last week, Bunnings announced it came to an agreement with the Shop, Distributive and Allied Employees Association to trial a four-day work week for its full-time employees, the first retailer in Australia to do so.

This adds Bunnings to the gradually expanding list of Australian companies that have trialled a four-day work week.

A few companies in Australia have trialled and implemented a four-day work week including Rimini Street and Precision Sourcing.

Rimini Street adopted a four-day work week at the end of July in 2022. Originally planned as a month-long stint, the program has been extended until the end of 2023.

Daniel Benad, GVP & regional GM, Australia, New Zealand and South Pacific at Rimini Street said this extension was due to “support and enthusiasm” of the staff at the company.

Dubbed “Fabulous Fridays”, Benad said this way of work isn’t designed for every company but it works for Rimini Street right now.

“For organisations hesitant to test it out or adopt it, it may be due to staffing shortages, misconceptions, fear of the unknown, culture, or the core operating model of the business,” he said.

“For example, the four-day work week may not fit some companies that require daily in-person, hands-on work to fulfil commitments. For some, it may not be economically viable.”

Australian organisations that are considering the move to a four-day work week need to have the backing of senior leaders, Benad said. 

“Communication, setting of clear expectations, collaboration, and calibration – these are what we would recommend as core elements to a successful implementation of any scheduling structure,” he added.

Simon Hair, managing director at Precision Sourcing implemented a four-day work week in April 2020 to reduce costs during the pandemic.

He told Digital Nation that this new way of working has not impacted productivity.

With the introduction of the four-day work week, the company has seen a drop in sick days and a 100 percent employee engagement score.

While he is a champion for the four-day work week, he understands other company’s hesitations.

“It isn’t for every business. A reactive business or one that requires people on a client site may struggle. We are really happy about it and although it isn’t perfect it works for us,” he said.

Planning is key

For those companies looking to bring in the four-day work week, effective implementation and ongoing monitoring are key, Walshe said.

“I know someone who works in an organisation that has a nine-day fortnight and it is apparent that while the applicable day off is rotated across teams to ensure consistent coverage, some will work hard to make sure they can take the day off and potentially check in to address any unforeseen issues that arise on their 10th day and others will not,” she said. 

Walshe noted that this can create frustration and internal conflict if there is no apparent oversight or awareness of these kinds of inconsistencies by the appropriate leaders.

“It will be the high-performing ones who get frustrated and leave the organisation first, so such a situation adds unnecessary organisational risk,” she added.

Michelle Schuberg, CEO at Curiious said with so much recent but much-needed disruption to the working paradigm, there are many more options available to a business than there were a few years ago.

“So choosing the right structure more broadly is a bigger conversation than simply deciding on a four-day week,” she said.