Jobs and the Future of Work

New Zealand firm adopts its four day work week permanently

When a New Zealand employer trialled a four day work week, the result was an 'unmitigated success'.

When a New Zealand employer trialled a four day work week, the result was an 'unmitigated success'. Image: REUTERS/Luke MacGregor

Briony Harris
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The New Zealand firm that trialled a four day work week has now confirmed it will adopt the measure on a permanent basis.

The will-writing company Perpetual Guardian carried out an eight week trial earlier this year, giving their 200 or so employees an extra day off every week, while all pay and employment conditions remained unchanged.

Academics who studied the trial reported lower stress levels, higher levels of job satisfaction and an improved sense of work-life balance. Critically, they also say workers were 20% more productive.

The four day work week trial has attracted a huge amount of interest around the world, with an audience of 3.2 billion people in 32 countries engaging with the idea via 10,000 social media posts and 3,000 news articles, according to the firm’s founder Andrew Barnes.

“I think this is a global conversation now,” Barnes said in an interview with the New Zealand Herald. “Groups like the Trades Union Congress in the UK - as a direct result of our trial - have come out and said they want to explore bringing in a four day work week.”

Social benefits of four day work week

The company expects the bulk of its staff to choose to work a four day work week. But it is still an option, with Barnes stressing that flexibility is key.

Staff will be able to come into the office and work normal hours for five hours, if that is their preference. Others will be able to start or finish early to avoid traffic congestion and manage their childcare commitments, while others could opt for compressed hours.

The trial was measured by Jarrod Haar, professor of human resource management at Auckland University of Technology. He found job and life satisfaction increased on all levels, both at home and at work, with employees performing better and enjoying their jobs more than before the experiment began.

Those findings were exactly as Barnes had predicted. Indeed he says the decision to test the new way of working was “the right thing to do”, after looking at several global productivity reports on four day work week.

“This is a bit of a crusade for me now. I think it’s important to change how we work but I also want to identify all the social benefits that come with changing our thought processes about our work patterns,” he says.

All hours aren’t equal

The experiment has many implications, reigniting questions about productivity and a culture of long working hours, as well as the way in which part-time workers are valued and rewarded.

One thing that is already clear is that longer hours, as in the case of four day work week, do not necessarily mean greater productivity.

South Korea, for example, ranks near the bottom of OECD countries for labor productivity despite having a culture of working very long hours. Similarly, within Europe, Greece has one of the longest working weeks but comes out bottom in the OECD’s measure of GDP per hour worked.

hours worked productivity trials shortening working day four day work week
Not all the hours worked contribute the same to GDP. There have been many trials for increasing productivity by shortening the working day rather than having a four day work week. Image: OECD via Statista

Japan is another example of a country where a culture of long working hours does not tally with increased productivity. Japan is now deliberately cutting down on overtime and using tactics such as turning the lights out at the end of the working day in order to reverse this trend.

There have also been a number of trials that look at increasing productivity by shortening the working day rather than the working week.

Increased costs?

In Sweden, for example, the government has trialled allowing workers at a retirement home to work six-hour days. Although the employees reported improved quality of life, with less stress and more time to spend with their families, it was also an expensive experiment for the local council, which had to hire extra workers to make up for the shortfall in hours.

Iceland conducted a similar trial, allowing some Reykjavik city workers to reduce their working week by four or five hours. In that experiment, productivity continued at the same level, meaning costs remained the same as well. The employees also had greater work satisfaction and fewer days off sick.

These two studies suggest that it may be the nature of the work which is critical in deciding whether reducing the length of the working day is cost-effective. For shift workers such as nurses, security guards or careworkers a continual presence is needed, meaning the employer will need to find somebody else to cover the jobs.

But for office workers, it may be a case of Parkinson’s law which states that “work expands to fill the time available for its completion.” Or, to put that in a slightly different way, workers will become more efficient if there is less time to complete a task, for example in a four day work week.

Ironically, of course, part-time workers are often paid less than their full-time colleagues, even though many working parents will also recognize the truth that they achieve in four days what others do in five.

Part-time work can also help increase the diversity of the workforce and is reported to be one of the reasons behind online retailer Amazon’s experiment with shorter days.

One thing is certain, this is just the start of the conversation. And many policymakers and companies will continue to reflect on the results of Perpetual Guardian’s four day work week experiment and examine how to both increase productivity and improve work-life balance.

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