Last April, a company in New Zealand launched an experiment: For eight weeks, employees would work only four days each week, but would keep getting full-time salaries. Not surprisingly, university researchers who studied the trial found that workers reported less stress and more satisfaction with their jobs when they had an extra day off. But the company remained productive; some workers even said that they were more productive in four days than five. Last fall, the company, a 240-employee statutory trust firm called Perpetual Guardian, made the four-day workweek permanent.
In a new white paper, the company shares some of what it has learned for other companies that are now interested in doing the same thing. How companies work today is not working, Andrew Barnes, Perpetual Guardian’s CEO, tells Fast Company. “And what we’re trying to do here is to frame the debate in a way that makes it easier for companies to say, you know what, let’s give this a go. Because it’s all about evidence-based, productivity-based evaluation.” Here are a few of the company’s suggestions:
1: Be clear about the goal
There are several reasons that companies might want to make the change. Perpetual Guardian’s data showed that workers felt more empowered, engaged, and stimulated at work, more committed to the company, and more confident in the leadership team. But the company also had a focus on productivity, and from the beginning, that was clear to workers. “To justify this to my investors, I would have to make sure that productivity wouldn’t drop,” he says. After seeing data about the fact that distractions mean that employees often spend only a few hours each day actually working, he hypothesized that it would be possible to make up for the lost day by changing habits.
2: Ask workers how to make it successful
Perpetual Guardian asked staff to consider both how they would measure their own productivity and to brainstorm ways to make a shorter schedule feasible. “We said, okay, here’s the gig: productivity has to remain the same, you tell us, first of all, how we should judge you,” he says. Teams measure productivity differently from each other depending on the type of work. Workers came up with a variety of small changes to test–for example, reducing time spent browsing online, or cutting meetings from one hour to 30 minutes and then seeing if that changed the usefulness of the meetings (it didn’t).
3: Create a flexible policy
Many of the people who have opted into the policy at the company so far choose Monday or Friday as their “productivity day,” giving themselves a long weekend, but others take off Wednesdays; the company doesn’t prescribe a set schedule. Others can choose to work five days but come in later and leave earlier, though senior leaders are required to work a four-day week to set an example. The flexibility lets workers choose a schedule that makes the most sense for them. Teams with outward-facing roles did have to plan schedules to ensure that clients would always be able to contact someone. There’s also a companywide understanding that occasionally it may be necessary to work a longer week, for example, during end-of-the-year financial reporting.
4: Consider a trial before making a permanent change
Starting with a trial “allows potential kinks in a flexibility policy to be ironed out while not committing the company to expensive or lengthy legal work upfront,” the white paper suggests. For instance, the shift may pose legal challenges: in New Zealand, for example, annual leave is based on the number of weeks worked, and Perpetual Guardian’s lawyers had to study how the change in schedules might affect holidays. (In that case, nothing changed because employees were still paid for five days). It’s better, the company says, to start by thinking about the big picture and strategic implications of the change rather than becoming bogged down in technical issues from the beginning. With good data, a trial can also make the case for the change.
5. Think about part-time workers
At Perpetual Guardian, at least one parent had negotiated a flexible schedule prior to the change–and a reduced salary. The CEO told her that he would have to start paying her a full salary, though she could keep her previous schedule. He argues that a four-day week can help reduce the gender pay gap, since many working mothers make similar compromises on salary. “Why are they negotiating on time? Why aren’t they negotiating on productivity?” he says.
A shorter week, Barnes says, can have multiple benefits for society, particularly if it’s adopted broadly. Taking 20% of cars off the road on a given workday would reduce pollution and traffic. If an extra day off was common, organizations might start developing daylong courses to help employees learn new skills and better prepare for automation. Parents would have more time to help their children study. At a time when one in five workers in New Zealand is suffering from stress or mental health issues–and in the U.S., one survey found that 60% of respondents felt stressed an average of three workdays each week–an extra day off might help alleviate some of that stress. “When you start to peel back the layers of this, I think it makes a material difference,” Barnes says. “If we were to have a country bold enough to really give this a go, I think we would find that actually there is not an adverse impact on the economy.”