A business owner who employs about 60 employees explained that their company will not have an opportunity to provide performance-based merit increases this year. They were concerned, and rightfully so, about their employees’ reactions. They asked me how this will affect employee morale, productivity, retention and overall commitment to the company.
During our conversation, I asked how they attracted employees to work for the company in the first place. From that question, it became clear to the business owner that they didn’t ask employees to work 70-hour work weeks and promoted a healthy work-life balance, which are what attracted a lot of employees initially. Although wages at the company were typically lower than its competitors, many employees found a work-life balance more appealing than a higher wage.
Leveraging Compressed Work Weeks as a Competitive Advantage
Like many business owners, the owner in my example above had questions about leveraging a company culture that encourages a work-life balance as a competitive advantage for the purpose of attracting and retaining high-performing employees. This naturally led to a discussion on compressed work week arrangements.
Compressed work weeks have the potential to lower absenteeism, reduce turnover and increase employee satisfaction. Additionally, compressed work weeks can be promoted as an innovative Human Resources (HR) program that sets your company apart from competitors.
This type of program sounds great, but will it work for your workforce?
The first step is understanding what a compressed work week is.
What Exactly is a Compressed Work Week?
The most common compressed work weeks include:
- 4/40—A 40-hour work week consisting of four 10-hour days and one day off; or
- 9/80—80 hours worked over a two week period consisting of eight 9-hour days, one 8-hour day and one day off.
Compressed work weeks require a lot of thought and preparation in advance.
Pitfalls to Avoid
As with everything else in business, there are things you need to watch out for, including:
- Making decisions based on emotion—This is not the type of decision you make on your own. Speak with your supervisors and managers to determine the level of employee interest.
- Making decisions without involving HR and/or legal counsel—HR programs and policies will need to be re-evaluated. For example, how will employees be paid for Paid Time Off (PTO), including, but not limited to: PTO or Vacation/Sick/Personal and holidays? Are there state-specific laws to consider? How will overtime be managed (overtime laws still apply, although there are ways to alleviate the burden)? The existing pay cycle will need to be re-evaluated as well. Are there industry-specific considerations?
- Making quick decisions without gaining buy-in—Do you have the support from your executive team, managers and supervisors?
- Making decisions without thinking through logistics—Did you consider participation levels? What will be offered to those ineligible to participate?
- Failure to evaluate the program—Is the program achieving what you set out to achieve?