Connect with us

Business

Opinion: Can a four-day workweek really work? Many companies have already learned the answer

Published

on

Opinion: Can a four-day workweek really work? Many companies have already learned the answer

In 1940, Congress amended the Fair Labor Standards Act to limit the standard workweek to 40 hours, with any additional hours eligible for overtime. Despite a more than threefold increase in productivity since, the 40-hour week has remained unchanged for 83 years.

But it may be changing at last. 2023 could just be the year of the four-day, 32-hour week.

Over the first few months of the year, Google searches for information about the four-day week rose by a factor of five. The media have produced hundreds of stories on companies that are offering 32-hour schedules. California and other states have considered legislation to enact or study a four-day week, and Riverside Rep. Mark Takano has introduced a bill on the subject in Congress.

In Europe, national and regional governments have pilot four-day week programs in progress, and the United Arab Emirates has shifted public-sector employees to a 4 ½-day schedule. In February, we released findings from the world’s largest trial of a four-day week with no reduction in pay, involving some 60 organizations in Britain across a range of sectors from public relations to healthcare to manufacturing. The results were striking: Employees and companies using the new schedule are thriving.

Advertisement

Why are reduced working hours suddenly on the agenda after years of not being taken seriously? The most important reason is the pandemic.

Leaders of the first organization to be part of our research attributed their decision to the COVID-driven shift to remote work. Dr. Adam Husney, the chief executive of the health information firm Healthwise, explained: “Once we realized we could trust our employees with where they work, we also realized we could trust them about how much time they work.”

Before the pandemic, there was a lot of talk about paying people for their output rather than their hours, but organizations honored the principle mostly in the breach. Once people are off-site, however, paying for productivity rather than time makes more sense, as least for employees who aren’t subject to draconian surveillance measures.

The pandemic also turbo-charged the four-day week by creating much more hardship for workers. While the work-life interface was difficult to navigate before COVID, the contagion itself and the complications of merging work and family life led to record levels of stress. The latest published research from Future Forum, based on a 2022 survey, found that 42% of employees polled in the United States and five other countries said they were burned out, a 4-percentage-point increase compared with just a year earlier.

Workers are responding with their feet. For Healthwise’s Husney, a staff exodus in June 2021 was the impetus for closing on Fridays. The labor market is experiencing not only the so-called Great Resignation — record numbers of people quitting their jobs — but also extremely high numbers of unfilled positions. Organizations are having difficulty retaining workers and scrambling to fill openings.

Advertisement

Raising pay isn’t always enough, and not all organizations can afford to do so. Turnover is also extremely expensive. It’s one reason much of the interest in the four-day workweek is coming from healthcare organizations, where burnout and resignations among nurses have become endemic.

We also think a quieter evolution away from the five-day schedule is underway. Many organizations have already reduced summer schedules by shortening or eliminating Friday hours. No-meeting Fridays have enabled more remote workers to take some of the day for themselves under the radar. We discovered that Friday morning classes at an exercise studio in our area have become very popular, thanks partly to people who reported being “at work.”

Our research suggests that the four-day, 32-hour week is not only feasible; it’s better for workers and employers.

In collaboration with the nonprofit 4 Day Week Global, we’ve been tracking what happens when companies switch to the curtailed schedule with no reduction in pay after a two-month process of figuring out how to maintain productivity and performance. We’ve found that employee well-being is markedly improved. Of more than 100 companies with thousands of workers around the world, nearly 70% experienced reduced rates of burnout.

Stress fell. Reported physical and mental health improved. People felt less anxious and fatigued, exercised more and slept better. Their life satisfaction rose, and conflicts among work, family and life plummeted.

Advertisement

But it’s not just workers who benefited. On a 10-point scale, companies rated the success of the trials at a robust 8.5 or higher. Perhaps the most persuasive metric is that most are opting to continue with the shorter schedule. Only a handful of the organizations that have participated in the trials have reverted to the five-day week.

Many will continue to oppose a shortened work schedule because it sounds un-American or unprofitable. But we’re finding out that modern challenges make the four-day workweek not only possible but better for workers, employers and society.

Juliet Schor is a professor of sociology and Wen Fan is an associate professor of sociology at Boston College.

Advertisement
Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Business

Cookies, Cocktails and Mushrooms on the Menu as Justices Hear Bank Fraud Case

Published

on

Cookies, Cocktails and Mushrooms on the Menu as Justices Hear Bank Fraud Case

In a lively Supreme Court argument on Tuesday that included references to cookies, cocktails and toxic mushrooms, the justices tried to find the line between misleading statements and outright lies in the case of a Chicago politician convicted of making false statements to bank regulators.

The case concerned Patrick Daley Thompson, a former Chicago alderman who is the grandson of one former mayor, Richard J. Daley, and the nephew of another, Richard M. Daley. He conceded that he had misled the regulators but said his statements fell short of the outright falsehoods he said were required to make them criminal.

The justices peppered the lawyers with colorful questions that tried to tease out the difference between false and misleading statements.

Chief Justice John G. Roberts Jr. asked whether a motorist pulled over on suspicion of driving while impaired said something false by stating that he had had one cocktail while omitting that he had also drunk four glasses of wine.

Caroline A. Flynn, a lawyer for the federal government, said that a jury could find the statement to be false because “the officer was asking for a complete account of how much the person had had to drink.”

Advertisement

Justice Ketanji Brown Jackson asked about a child who admitted to eating three cookies when she had consumed 10.

Ms. Flynn said context mattered.

“If the mom had said, ‘Did you eat all the cookies,’ or ‘how many cookies did you eat,’ and the child says, ‘I ate three cookies’ when she ate 10, that’s a false statement,” Ms. Flynn said. “But, if the mom says, ‘Did you eat any cookies,’ and the child says three, that’s not an understatement in response to a specific numerical inquiry.”

Justice Sonia Sotomayor asked whether it was false to label toxic mushrooms as “a hundred percent natural.” Ms. Flynn did not give a direct response.

The case before the court, Thompson v. United States, No. 23-1095, started when Mr. Thompson took out three loans from Washington Federal Bank for Savings between 2011 and 2014. He used the first, for $110,000, to finance a law firm. He used the next loan, for $20,000, to pay a tax bill. He used the third, for $89,000, to repay a debt to another bank.

Advertisement

He made a single payment on the loans, for $390 in 2012. The bank, which did not press him for further payments, went under in 2017.

When the Federal Deposit Insurance Corporation and a loan servicer it had hired sought repayment of the loans plus interest, amounting to about $270,000, Mr. Thompson told them he had borrowed $110,000, which was true in a narrow sense but incomplete.

After negotiations, Mr. Thompson in 2018 paid back the principal but not the interest. More than two years later, federal prosecutors charged him with violating a law making it a crime to give “any false statement or report” to influence the F.D.I.C.

He was convicted and ordered to repay the interest, amounting to about $50,000. He served four months in prison.

Chris C. Gair, a lawyer for Mr. Thompson, said his client’s statements were accurate in context, an assertion that met with skepticism. Justice Elena Kagan noted that the jury had found the statements were false and that a ruling in Mr. Thompson’s favor would require a court to rule that no reasonable juror could have come to that conclusion.

Advertisement

Justices Neil M. Gorsuch and Brett M. Kavanaugh said that issue was not before the court, which had agreed to decide the legal question of whether the federal law, as a general matter, covered misleading statements. Lower courts, they said, could decide whether Mr. Thompson had been properly convicted.

Justice Samuel A. Alito Jr. asked for an example of a misleading statement that was not false. Mr. Gair, who was presenting his first Supreme Court argument, responded by talking about himself.

“If I go back and change my website and say ‘40 years of litigation experience’ and then in bold caps say ‘Supreme Court advocate,’” he said, “that would be, after today, a true statement. It would be misleading to anybody who was thinking about whether to hire me.”

Justice Alito said such a statement was, at most, mildly misleading. But Justice Kagan was impressed.

“Well, it is, though, the humblest answer I’ve ever heard from the Supreme Court podium,” she said, to laughter. “So good show on that one.”

Advertisement
Continue Reading

Business

SEC probes B. Riley loan to founder, deals with franchise group

Published

on

SEC probes B. Riley loan to founder, deals with franchise group

B. Riley Financial Inc. received more demands for information from federal regulators about its dealings with now-bankrupt Franchise Group as well as a personal loan for Chairman and co-founder Bryant Riley.

The Los Angeles-based investment firm and Riley each received additional subpoenas in November from the U.S. Securities and Exchange Commission seeking documents and information about Franchise Group, or FRG, the retail company that was once one of its biggest investments before its collapse last year, according to a long-delayed quarterly filing. The agency also wants to know more about Riley’s pledge of B. Riley shares as collateral for a personal loan, the filing shows.

B. Riley previously received SEC subpoenas in July for information about its dealings with ex-FRG chief executive Brian Kahn, part of a long-running probe that has rocked B. Riley and helped push its shares to their lowest in more than a decade. Bryant Riley, who founded the company in 1997 and built it into one of the biggest U.S. investment firms beyond Wall Street, has been forced to sell assets and raise cash to ease creditors’ concerns.

The firm and Riley “are responding to the subpoenas and are fully cooperating with the SEC,” according to the filing. The company said the subpoenas don’t mean the SEC has determined any violations of law have occurred.

Advertisement

Shares in B. Riley jumped more than 25% in New York trading after the company’s overdue quarterly filing gave investors their first formal look at the firm’s performance in more than half a year. The data included a net loss of more than $435 million for the three months ended June 30. The shares through Monday had plunged more than 80% in the past 12 months, trading for less than $4 each.

B. Riley and Kahn — a longstanding client and friend of Riley’s — teamed up in 2023 to take FRG private in a $2.8-billion deal. The transaction soon came under pressure when Kahn was tagged as an unindicted co-conspirator by authorities in the collapse of an unrelated hedge fund called Prophecy Asset Management, which led to a fraud conviction for one of the fund’s executives.

Kahn has said he didn’t do anything wrong, that he wasn’t aware of any fraud at Prophecy and that he was among those who lost money in the collapse. But federal investigations into his role have spilled over into his dealings with B. Riley and its chairman, who have said internal probes found they “had no involvement with, or knowledge of, any alleged misconduct concerning Mr. Kahn or any of his affiliates.”

FRG filed for Chapter 11 bankruptcy in November, a move that led to hundreds of millions of dollars of losses for B. Riley. The collapse made Riley “personally sick,” he said at the time.

One of the biggest financial problems to arise from the FRG deal was a loan that B. Riley made to Kahn for about $200 million, which was secured against FRG shares. With that company’s collapse into bankruptcy in November wiping out equity holders, the value of the remaining collateral for this debt has now dwindled to only about $2 million, the filing shows.

Advertisement

Griffin writes for Bloomberg.

Continue Reading

Business

Starbucks Reverses Its Open-Door Policy for Bathroom Use and Lounging

Published

on

Starbucks Reverses Its Open-Door Policy for Bathroom Use and Lounging

Starbucks will require people visiting its coffee shops to buy something in order to stay or to use its bathrooms, the company announced in a letter sent to store managers on Monday.

The new policy, outlined in a Code of Conduct, will be enacted later this month and applies to the company’s cafes, patios and bathrooms.

“Implementing a Coffeehouse Code of Conduct is something most retailers already have and is a practical step that helps us prioritize our paying customers who want to sit and enjoy our cafes or need to use the restroom during their visit,” Jaci Anderson, a Starbucks spokeswoman, said in an emailed statement.

Ms. Anderson said that by outlining expectations for customers the company “can create a better environment for everyone.”

The Code of Conduct will be displayed in every store and prohibit behaviors including discrimination, harassment, smoking and panhandling.

Advertisement

People who violate the rules will be asked to leave the store, and employees may call law enforcement, the policy says.

Before implementation of the new policy begins on Jan. 27, store managers will be given 40 hours to prepare stores and workers, according to the company. There will also be training sessions for staff.

This training time will be used to prepare for other new practices, too, including asking customers if they want their drink to stay or to go and offering unlimited free refills of hot or iced coffee to customers who order a drink to stay.

The changes are part of an attempt by the company to prioritize customers and make the stores more inviting, Sara Trilling, the president of Starbucks North America, said in a letter to store managers.

“We know from customers that access to comfortable seating and a clean, safe environment is critical to the Starbucks experience they love,” she wrote. “We’ve also heard from you, our partners, that there is a need to reset expectations for how our spaces should be used, and who uses them.”

Advertisement

The changes come as the company responds to declining sales, falling stock prices and grumbling from activist investors. In August, the company appointed a new chief executive, Brian Niccol.

Mr. Niccol outlined changes the company needed to make in a video in October. “We will simplify our overly complex menu, fix our pricing architecture and ensure that every customer feels Starbucks is worth it every single time they visit,” he said.

The new purchase requirement reverses a policy Starbucks instituted in 2018 that said people could use its cafes and bathrooms even if they had not bought something.

The earlier policy was introduced a month after two Black men were arrested in a Philadelphia Starbucks while waiting to meet another man for a business meeting.

Officials said that the men had asked to use the bathroom, but that an employee had refused the request because they had not purchased anything. An employee then called the police, and part of the ensuing encounter was recorded on video and viewed by millions of people online, prompting boycotts and protests.

Advertisement

In 2022, Howard Schultz, the Starbucks chief executive at the time, said that the company was reconsidering the open-bathroom policy.

Continue Reading

Trending