Exploring the Legal Implications of a Four-Day Work Week

The concept of a four-day work week has been gaining momentum since the pandemic, with numerous studies highlighting its benefits, such as improved employee morale, increased productivity, and enhanced talent attraction. However, before implementing this new schedule, employers must carefully consider the legal ramifications. In this article, we will delve into the essential considerations that employers should take into account before making the switch, including the impact on part-time employees, employment contracts, and holiday entitlement. The introduction of a four-day work week can have significant implications for part-time employees, who may need to receive full-time equivalent salaries or have their salaries pro-rated based on the new work week. Additionally, employers engaging workers through employer of record arrangements or on a freelance/contractor basis may face further complications. It is crucial to consider what days employees and contractors will work and how the change will affect the company's operations and stakeholders. Employers must also get employees on board before implementing the new schedule, as changing working days would require consultation and agreement between the employer and employee to vary their employment contracts. A comprehensive and fair process is necessary to avoid disparity between contractual terms and potential legal disputes. The laws regarding holiday entitlement are complex, and employers must carefully consider the impact of changes to the working week on employees' holiday entitlement. In theory, if an employer switches to a four-day week but maintains the standard working hours, employees' holiday entitlement would remain the same. However, if employees work less than 35 hours, employers may be able to reduce their holiday entitlement under current legislation. Employers must also decide how to handle bank holidays and ensure that employees' holiday entitlements are calculated correctly. When implementing a four-day work week, employers have various models to choose from, including compressed hours or reduced pay. It is recommended that employers implement any changes on a trial basis initially to assess their viability and communicate effectively with staff. Key legal considerations include understanding the impact on the workforce, having a clear plan for implementation, and reviewing employment contracts and holiday entitlements. While a four-day work week may not be the norm in the present, it is likely to become more prevalent in the future. Games companies, in particular, may find the concept appealing due to its potential to attract and retain talent. However, it is essential for employers to carefully consider the implications and potential risks associated with implementing a four-day work week and ensure that the change is implemented properly to avoid exposing the business to unnecessary employment risk.