The 4-Day Workweek: Potential Legal Ramifications
If there’s a leading employment trend shaping 2023, it’s the 4-day workweek. As more businesses scramble to retain their top talent and compete for skilled workers, managing bigger workloads and preventing employee burnout is a significant challenge. In this context, advocates for a 4-day workweek claim it’s an attractive option to help workers avoid burnout and find a healthy work-life balance. Nonetheless, there is ongoing debate and research into whether this option really addresses the core issues of excessive workloads and unhealthy intensification while also benefitting an employer’s financial bottom line.
The 4-Day Workweek May Be Popular, but It Isn’t for Everyone
While Canada isn’t the first country to pioneer the 4-day workweek transition, we have much to gain by learning from early adopters. For example, if you’re wondering whether a 4-day workweek would improve your team’s productivity and engagement, consider these results from one of the largest trials of a 4-day workweek in Britain, where a significant majority of participants indicated they would continue with the shorter workweek trial, with 30% making the change permanent. However, the trial didn’t work for every business, and participants reported having to navigate new challenges arising from the shortened workweeks.
Three Different 4-Day Workweek Models
4×8 hour workdays with the same pay
Employees work a reduced 32-hour workweek distributed over four days instead of five and receive the same pay and benefits as they would if they worked a 40-hour workweek.
4×8 hour workdays with reduced pay
Employees work a reduced amount of hours and accept a reduced amount of pay and potentially reduced benefits, depending on their provider and coverage.
4×10 hour workdays with the same pay
Employees work a 40-hour workweek for the same pay and benefits, with work distributed over four workdays instead of five.
The 4-day workweek model you choose largely depends on the type of work your staff does and whether your employees can feasibly meet output requirements in less time.
If You’re a Business Operating in British Columbia:
Employers wishing to test or adopt a 4-day workweek must ensure the structure they choose doesn’t conflict with provincial employment standards or trigger potential legal implications.
Potential Legal Issues to Avoid and Consider
Effects on employee benefits and employment insurance
A shorter workweek may affect workers’ benefits depending on their provider and coverage agreements. Shorter workweeks that result in fewer overall hours per month may also affect how employees’ vacation days are calculated and employees’ eligibility for employment insurance.
Team structure
How adopting a shorter workweek affects your employees also depends on your company’s employee/employer arrangement and whether the Employment Standards Act covers the employee. For example, certain employment regulations don’t apply to independent contractors, specific industries or professions that are governed by their own industry-specific acts instead, including accountants, health practitioners, and lawyers, to name a few. And unionized workplaces have their own collective agreements that should be referred to.
Human rights and duty to accommodate
Some employees may object to the new 4-day workweek you implement, resulting in disgruntled or lost workers. For example, employers that adopt 4-day workweeks that consist of four 10-hour days are more likely to run into employee resistance due to conflicting obligations outside of work, which can come with its own legal implications as follows.
Suppose any of your employees object to conform to a new 4-day workweek consisting of longer hours because doing so conflicts with their childcare or eldercare obligations or other protected grounds. In that case, it is the employer’s duty to make reasonable efforts to accommodate their employee.
Another potential human rights issue may arise when employees working a reduced-hour workweek feel pressured to consolidate five days’ worth of work into four, especially if their output is measured and monitored. Employees that express anxiety due to what they perceive are unrealistic expectations should be heard and have their concerns formally addressed.
Failing to identify when a duty to accommodate arises and neglecting to work with your employee to ensure reasonable accommodations have been met can result in human rights infractions.
Constructive dismissal
Employees who quit after refusing to comply with unilateral changes to their working conditions, volume and schedules may claim a constructive dismissal unless the employer can show the changes could reasonably be expected for the position or the changes were implemented with proper advanced notice.
Constructive dismissal situations can be avoided by carefully reviewing your employment contracts and getting employee consent or providing proper advanced notice before implementing new workweek adjustments.
Overtime obligations
According to British Columbia Employment Standards Daily overtime regulations, a 10-hour workday can also make you, the employer, obligated to pay time-and-a-half for all time worked that surpasses 8 hours, regardless of how many total hours your employees work per week.
In addition, if an employee is asked to attend a meeting outside of their four workdays or work a fifth shift despite already working four ten-hour shifts, you could also be dealing with minimum daily pay standards on top of weekly overtime regulations.
Rest Period Requirements
British Columbia Employment Standards also state that employees are entitled to a minimum of 32 hours in a row each week that are free from work. Otherwise, the employer is required to pay time-and-a-half for all time worked during the intended rest period. So, if you wish to avoid overtime pay, be sure your employees receive at least 1.5-2 consecutive days off each week.
Potential Alternatives to Overtime Obligations
Some exceptions exist, which may allow employers and their employees to agree on a working arrangement that avoids overtime obligations.
Banking time
Employers and employees agree on an arrangement whereby they bank their overtime hours, which can either be paid out at a later time, added to their paid time off allotment, or credited via a combination of both. Even still, there are protocols that the employer must follow to ensure banked time is tracked and remunerated.
Implementing averaging agreements
Averaging agreements allow an employer and employee to agree to an average set of hours to be worked per period without triggering overtime pay, pending the daily average work hours don’t surpass 12 hours within the same day or more than 40 hours per week.
Applying for a variance
Variance applications are best suited for temporary adjustments in how work is carried out and must be agreed upon in advance between the employer and employee. Variances are time-limited and can be used to alter specific standards within the Employment Act, including daily hours of work, flexible work schedules, overtime wages and the number of weeks covered by an averaging agreement. Applying for a variance may be the way forward for employers and employees wishing to test run a 4-day workweek (or other flexible arrangements) before deciding whether to adopt it long-term.
Legal Issues Are Avoidable
Regardless of the workweek structure you choose, employers must be upfront with employees (and potential new hires) and take all necessary steps to clearly communicate expectations, address concerns and objections, and ensure the new working conditions meet local ordinances and don’t conflict with your employment contracts. This includes notifying workers before adopting, discontinuing or prolonging the new shift schedule.
While the potential legal ramifications of adopting a 4-day workweek or other flexible working conditions may seem daunting, with a bit of planning and sound professional advice, they don’t have to be barriers. Before making changes to your employment contracts, implementing averaging agreements or applying for a variance, the best way forward is to consult a trusted HR or Employment Law specialist to determine your options and outline a clear action plan.
Spraggs Law Can Help
If your business is located within British Columbia and you have questions about adopting a 4-hour workweek or other arrangements, our Human Resources Consultant and Employment Law Experts can help. Contact us today at (604) 359-1627 or reach out to us online.
Please note: This article does not contain legal advice. If you would like advice on your specific situation, please contact Spraggs Law.