The four-day workweek model — a success story
We have summarized the most important facts about the four-day workweek for you as follows:
- What is it about?
Within the framework of a four-day workweek, an employee's weekly working hours are evenly distributed over four days per week. Employees, thus, benefit from a three-day period off work. This enables a good work-life balance, reduces stress and increases employees' health, motivation and productivity.
- How can companies implement a four-day workweek and what do they need to consider?
In companies with a works council, a works council agreement is required for implementing the four-day workweek. In companies without a works council, individual consent has to be obtained. However, there is no "one-size-fits-all" model for the four-day workweek. Instead, companies have a variety of alternatives for implementing the four-day workweek.
- What kind of four-day workweek models are there?
Model No. 1 | Redistributing working time without reducing working hours and remuneration: The company redistributes the previous normal weekly working hours (usually 38.5 to 40 hours) from five to four days while remuneration remains the same. In this case, a daily normal working time of up to 10 hours and a maximum daily working time of up to 12 hours is possible. In this respect, overtime hours occur from the 11th working hour per day or the 40th working hour per week. In this variant, the daily workload is above average, which can somewhat reduce the positive effects of the four-day workweek.
Model No. 2 | Redistributing working time while reducing working hours but avoiding pay cuts: In order to fully exploit the positive effects of the four-day workweek, many companies reduce the normal weekly working hours to 37 or fewer, enabling a daily working time of 7.5 to 8.5 hours per day. However, many companies refrain from reducing the current remuneration despite the reduction in working hours. Personnel costs per worker will indeed increase in this case. Nevertheless, these are offset in the long term by increasing productivity.
Model No. 3 | Redistributing working time while reducing working hours and pay: This model implements Model No. 2 with regard to working hours, but also introduces a reduction in fixed salary. In this alternative, employers should consider compensating employees with special incentives, e.g., by introducing variable bonuses linked to specific performance targets that increase productivity. This promotes employee motivation despite short-term financial losses in fixed pay.
Model No. 4 | Flexi-time variant: A four-day workweek can also be accomplished by implementing flexi-time. In this respect, the flexi-time agreement will limit any core working time regulations to four days (e.g., Monday to Thursday) while in parallel enabling flexi-time days. In this case, the fifth day of the week (e.g., Friday or Monday) is considered a working day, but employees are actually not working on their flexi-time day. Under such conditions, even normal working hours of up to 12 hours per day are fairly permissible. The flexi-time agreement may be designed in such a way that employees themselves are free to choose each workweek whether they work four or five days.
- All-in-salary and four-day workweek
An all-in-salary considers and compensates a certain amount of overtime hours, usually based on a five-day workweek. In terms of a four-day workweek, as the daily workload is already very high, employees may be less willing or able to perform those overtime hours originally considered part of their salary package. Consequently, the pressing question is: how will companies deal with all-in salaries when implementing a four-day workweek? There are several alternatives, which range from reducing or canceling the all-in-salary to agreeing on a simple lump sum payment for overtime hours. However, even if the all-in-salary remains the same, there are certain options to mitigate a mismatch between pay and productivity after all, such as the introduction of targeted performance management tools and bonus models.
More and more companies are implementing the four-day workweek. In doing so, companies are enjoying a strong competitive advantage on the labor market. We at Baker McKenzie are very happy to advise and support you in identifying and implementing the four-day workweek model that is most beneficial for your company.
Click here to access the German version.