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50 (145) 2021

Lessons from the Pandemic

The four-day working week. A passing fad among rich companies or the new reality?

By Łukasz Chodkowski, Dehora
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The experience of the pandemic, has forced a change in the approach to time management in companies and, in many cases, a shift to remote or hybrid working and a reorganisation of work schedules. This has led many experts and managers to boldly discuss going one step further and reducing the working week, ideally to 32 hours in an average four-day working week.

Anyone who follows social media and HR industry portals on a regular basis will easily get the impression that there is nothing hotter than the topic of the four-day week. There are many articles and analyses of actions taken by large companies, such as Microsoft, Unilever or Toyota, which are testing the four-day week. Every ambitious HR manager is eagerly awaiting details of evaluation of these projects.

The question is, however, whether in Poland in 2021 we are able to realistically discuss this, or whether it’s more of a passing fad. Reality will soon verify our ambitions and hopes. We know that the Labour Code in force in Poland was enacted in 1974 (albeit ‘as amended’) and work on a new code has stalled.

On the other hand, however, we know that many changes are introduced by employers on their own initiative and the code does not prevent them from doing so. Exactly as was the case during the first lockdown, when without waiting for regulations, solutions were introduced immediately, action that often saved companies from collapse. Thus, it can be seen that business is flexible and can adapt to the reality. Nevertheless, is the introduction of a four-day week on a large scale possible without systemic and legislative support? Large and wealthy companies with innovation in their DNA will find funds for pilot projects. Some of these projects are an element in the strategy of image warming, which is great, but is still mainly marketing.

When analysing this issue, it is worth taking a look at the history to begin with. Why do we actually work at all? And how much time on average per week have we historically devoted to work?

Today, it is an essential part of our lives. It defines us. Some researchers even point out that prehistory has left its mark on how we perceive work today.

Hunter-gatherers in the warm regions of the globe worked in a different way. They could live from day to day, satisfying only their basic and current needs. Work was different in colder areas, where for some part of the year it was impossible to gather enough food. It was therefore necessary to gather food to stockpile. The development of methods for gathering food helped to speed the establishment of cities, and work became closer to the way we understand it today. Gradually, people began to specialise in particular activities, which over time evolved, for example, into the guilds familiar from the Middle Ages.

In the 18th century in England (then the richest country in the world) looking for solutions to increase productivity in the textile industry invented the power loom, which increased productivity in weaving up to 40 times. At the same time, mining and metallurgy developed very quickly. This period is called the first technological revolution. Development in industry entailed the development of transportation and communication. A significant increase in production was associated with the transportation of more and more goods. In later years, the rapid development of science led to the beginning of what is called the second industrial revolution. New technologies were developed, from the internal combustion engine to dynamite and the machine gun, to the telephone in 1876, the light bulb in 1879, and the electric vacuum cleaner in 1907.

Although it's hard to imagine today, at the time of the Industrial Revolution, the average working time for workers was between 80 and 90 hours. Not to mention the employment of children, even five-year-olds). The increase in productivity and industrialisation led to major social changes, symbolised, on the one hand, by the Luddite movement – who destroyed machines for fear of losing their jobs, on the other hand, employment in agriculture decreased, trade unions were formed and labour laws were created. It was thanks to these social changes, among others, that at the turn of the 19th and 20th centuries working hours were reduced from the aforementioned 80-90 hours to 40-48 a week. The demand for an eight-hour working day was put forward as a response to the growth of productive forces and productivity.

The so-called scientific and technological revolution, which began after World War II and continues to this day (although there is more and more talk about a fourth, related to the Internet of Things) has not yet contributed to such radical changes in the approach to working time. Why not? We don’t have to go back to the times of the post-war economy to realise, at least in our own careers, how productivity has increased over the past 20 years. And to what extent the Internet, automation, robotisation has increased the capacity and our productivity, understood as GDP per capita. Between 1993 and 2016, productivity as measured by GDP per capita in purchasing-power parity dollars increased in Poland by almost two and a half times.

Despite this, only two years ago, the topic of shortening weekly working hours – while maintaining wages – seemed distant in Poland. The idea of shortening the working time, although it seems to be new, originated in the mind of John Maynard Keynes already at the end of the 1920s. He claimed then that: "Within 100 years productivity will have increased so much due to advances in technology that we will not need to work more than 15 hours a week."

The pandemic has taught us that our businesses can be more flexible than many experts estimated. Smooth transition to remote work, hybrid models or reorganisation of work of manufacturing companies encouraged us to look for new solutions – new also in terms of building an employer image. And it is this employer image that companies such as Microsoft and Unilever were primarily concerned about. The strength of their brand allows them to assume that they can become trendsetters. Unilever has decided to submit the results of its project for analysis by the University of Sydney, which is to evaluate and advise the company on whether to expand such an approach globally. Especially among companies in the industry this will be a move that cannot be overlooked. Microsoft, in turn, announced that its pilot in Japan resulted in a productivity increase of 40%.

The redefinition and reorganisation of work schedules is currently being discussed in the UK, Spain, New Zealand and Scandinavia. The moment when the topic ceases to be hot only on the level of tests in large corporations or cities, and starts to become a global topic, discussed on the forum of countries, is the breakthrough moment. However, two examples seem truly revolutionary.

The first is Spain. A three-year EU-funded pilot project is planned there, with about 200 companies to take part in the €50 million project. Importantly, only companies from the SME sector may apply, and the only criterion is the willingness to reduce working hours while maintaining the same salaries. The state covers the costs of 100% in the first year, 50% in the second and 25% in the third. Spaniards (as well as Jacinda Ardern – Prime Minister of New Zealand) hope that this measure will also revive local tourism, which has been heavily affected by the pandemic. Proponents of reducing working hours (Mas Pais party) argue that the barriers are mainly in the head. Representatives of this party say: "In 1850 we worked 11 hours, today we work eight hours. Yet we are eight times richer."

The second example is Iceland, which conducted a pilot on an unprecedented scale. A group of 2,500 employees from 100 companies (about 1% of the working population) worked in a reduced working time system (to 35 hours a week) for 12 months. The findings and analysis are very promising. Contrary to concerns, productivity did not decline, overtime did not increase, and service quality ratings remained unchanged.

In the article: "Will the Four-Day Week Take Hold in Europe" published in the Harvard Business Review magazine, the authors argue that employees can do exactly the same thing in 30 as in 40 hours, plus they are more rested.

Another example is the Spanish company Delsol, which last year reduced the working hours of its employees, and the money saved (€400,000) was used for training support and software purchases. As a result, absenteeism fell by 28% year-on-year.

At this point, it is also worth mentioning an additional aspect which makes the idea of working time reduction more and more important for governments. This is global warming. Already in 2012, researchers from MIT calculated that a 10% reduction in working hours would be enough to reduce the carbon footprint by 14.6%!

The reasons for shortening the working week include climate protection, the physical and psychological well-being of employees, and a reduction in absenteeism. And all this without increasing costs and burdens for companies.

So – what’s stopping us? As Canadian sociologist Karen Foster argues: "We are extremely attached to the idea that hard work is a value, and people with a lot of free time are not trustworthy".

To introduce large-scale changes in working-time planning, we need modern, conscious companies, which will not manage on a larger scale without systemic support (in the first stages). The examples of Spain and Iceland illustrate this very well. The change of social attitudes must proceed in parallel. Perhaps young generations entering the labour market will accelerate this process. Another issue is the approach to the issue among service and manufacturing companies. As in office companies and those, where people work eight hours a day from Monday to Friday, it is much easier to imagine such a change. However, in production companies, the situation – due to the complexity of processes and shift work – is much more complicated. And especially in companies operating 24/7, where the continuity of operations must be maintained and the physical presence of the employee, and supervision of the production process is essential. The industry, despite continuous automation and robotisation, still relies on the presence of man on the production line.

The question of whether we need such a wide-ranging discussion on reducing working time can perhaps be answered by data from the OECD on statistical working time. In 2020, Iceland ranked 10th among countries with the shortest working hours, according to data released by the OECD. Last year, the statistical Icelandic worker worked 1,435 hours. The shortest working nation was Germany, with an average of 1,332 hours per employee. A statistical Spaniard (despite the fact that we associate them with an eternal siesta) works 1,686 hours. In Poland we break records in this respect with an average of 1,806 working hours per year...

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