Why a 4-Day Work Week Is a Good Idea, According to This Company’s Recent Experiment

August 28, 2018

What if your company could implement a simple strategy that made employees happier, more creative, and less stressed? And what if this somewhat counterintuitive tactic cost virtually nothing to put in place?

Perpetual Guardian, a New Zealand company that manages trusts, wills, and estates, experimented with a 32-hour work week in March and April. The company also brought in two researchers to study the effect of paying 240 employees for a five-day work week but only asking them to work four days.

The result? Perpetual Guardian saw no drop-off in productivity.

On top of that, Jarrod Haar, a human resources professor at Auckland University of Technology, reported that the number of employees who said they were managing work-life balance well rose from 54% to 78%. “Supervisors said staff were more creative, their attendance was better, they were on time, and they didn’t leave early or take long breaks,” Haar told The New York Times. “Their actual job performance didn’t change when doing it over four days instead of five.”

With retention being such a critical issue and study after study showing that employees want to work for companies that are flexible about where and when they work, the Perpetual Guardian experiment is worth exploring.

In some cases, cutting work hours may be a way to boost productivity

In 1926, Henry Ford cut the work week on his pioneering automotive assembly lines from 48 to 40 hours, believing the reduced hours would actually boost productivity. So maybe it should come as no surprise that Andrew Barnes, the founder of Perpetual Guardian, decided to run his 32-hour-a-week experiment after reading a report that said the average worker spends less than three hours—2 hours, 53 minutes, to be exact—of their workday productively.

Barnes asked Haar and Helen Delaney, a senior lecturer at the University of Auckland Business School, to study the effects of the two-month experiment. He also asked his employees to help design the company’s four-day work week so that productivity didn’t drop off.

“Employees designed a number of innovations and initiatives to work in a more productive and efficient manner,” Delaney told The Guardian, “from automating manual processes to reducing or eliminating non-work-related Internet usage.” They also cut standing two-hour meetings to 30 minutes.

“They worked out where they were wasting time and worked smarter, not harder,” Haar said.

The results were breathtaking—less stress, more commitment, and sustained productivity

A survey of Perpetual Guardian employees at the end of the experiment was compared with a survey done in 2017 and showed stress levels, rather than rising as employees raced to get all their work done in four days every week, actually dropped 7 percentage points. At the same time, commitment, stimulation, and sense of empowerment all rose significantly. Employees reported an overall life satisfaction increase of 5 percentage points.

These results were similar to those reported after a 23-month trial by the Swedish government that had nurses at an elder-care facility in Gothenburg reduce their work days from eight hours to six. Employees in that study were happier, enjoyed their jobs more, and were less stressed. As a bonus, the 68 nurses were sick less often, more physically active, and reported less back and neck pain. Collins SBA, a financial advice firm in Hobart, Australia, adopted a five-hour workday last year and saw sick days plummet, talented candidates join up, and some advisers doing record new business.

The one measure Barnes was most interested in was productivity. “Our leadership team reported that there was broadly no change in company outputs pre- and during the trial,” Barnes told The New Zealand Herald. “They perceived no reduction in job performance and the survey data showed a marginal increase across most teams.”

Did Barnes really believe these reports?

Well, he recommended to his board that the change become a long-term one.

“We’re paying for productivity,” Barnes said. “We’re making a clear distinction here between the amount of hours you spend in the office and what we get out of that.”

Employees will stick around for flexibility and work-life balance

Recent research by the Advisory, Conciliation, and Arbitration Service in the United Kingdom showed that flexible work options can boost the effectiveness of individuals and teams. And a LinkedIn survey this spring of more than 3,000 U.S. professionals found that when respondents were asked why they were proud of their company, the most frequent answer (51%) was “There is good work-life balance and flexibility.”

With retention looming as a major challenge for employers, a study earlier this year by Deloitte found that millennials are much likelier to stay in a role for five or more years if their company is flexible about when and where they work.

Before Barnes launched his experiment, he also read a report that said that distractions at work impeded productivity the same way losing a night’s sleep or smoking marijuana did. Barnes wanted employees to be able to focus on their business when in the office and use their extra day off to take care of their home commitments.

“If you can have parents spending more time with their children,” Barnes asks, “how is that a bad thing?”

Final thoughts: Just a matter of time

Time is, of course, the one thing there never seems to be enough of. In giving its employees back a day each week, Perpetual Guardian bestowed a stunning gift on them. It’s little wonder the company got great feedback on its post-trial surveys.

Time is also a gift that could be wrapped many different ways—an extra hour a day, an extra day a month, three extra holidays a year.

Maybe the time has come for companies everywhere to look at their work weeks and ask whether a schedule introduced to produce the Ford Model T is the best one for a generation driving the Tesla Model S.

*Photo by Lidya Nada on Unsplash

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