California Legislature Considers 4-Day Workweek for Companies

California Legislature Considers 4-Day Workweek for Companies a welcome to california sign A "welcome to California" sign. (Ty O'Neil / SOPA Images/Sipa USA via AP Images)

By Charlie McCarthy | Friday, 15 April 2022 09:18 AM

A four-day workweek for larger companies is being discussed in the California State Legislature.

The California State Assembly's Labor and Employment Committee was expected to decide by week’s end whether a proposal defining the workweek in the state as 32 hours, not 40, for larger companies moves forward.

If it eventually gets passed, the bill would affect more than 2,000 private-sector companies with more than 500 employees.

The four-day workweek could help a tight labor market with workers seeking more flexibility.

"This is not going away," Evan Low, a Democrat California State Assembly member who co-wrote the bill, told The Wall Street Journal.

The legislation also calls for hourly employees to be paid time-and-a-half for overtime.

Not everybody is on board with the effort.

The California Chamber of Commerce earlier this month added the bill to its "job killer list," saying the legislation would significantly increase labor costs for a state that is home to many of the world’s largest tech companies and is the most-populous (39 million) U.S. state.

Nicholas Bloom, a Stanford University economics professor, told WSJ that the bill, which would require businesses to pay the same amount of money for one less day of work, should not pass.

"Jobs will shift to Nevada or Oregon, and employers will not be able to raise pay for many years," Bloom told WSJ.

Bloom suggested that a better alternative for businesses and shift workers who have to do work in person would be longer hours spread out across fewer days. That way, workers would benefit from not having to commute as much.

Research into the effectiveness of shortened weeks is mixed, WSJ reported. Economic studies out of Germany and France found that fewer hours didn’t increase employment.

However, a 2013 study on Belgian private companies found that employees who worked 25-35 hours a week were more productive than those who worked more or less than that, WSJ said.

A recent survey of 459 companies, mostly in tech, found that 90% of companies didn’t plan to adopt a four-day workweek, according to Sequoia Consulting Group.

Many businesses already have accommodated worker preferences by offering hybrid schedules in which employees are required to come to the office three days a week,

Sequoia Vice President Kyle Holm said that because most tech workers say they put in a lot more than 40 hours a week, getting their current jobs done in 32 hours would be difficult.

"It doesn’t really, to me, line up with what people are actually doing when they’re not paid on an hourly basis," Holm told WSJ.

Original Article