4-day Work week
Posted: 24 August 2008 02:31 PM   [ Ignore ]
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We have a small firm of 10 employees; 5 exempt and five hourly.  We would like to look at the possibility of implementing a four-day work week—particularly with respect to hourly employees.  We believe this would be beneficial, however, owner of company is not inclined to offer for non-exempt employees - - can I still offer to hourly?  Secondly, how would I handle paid holidays, accrued vacation time/sick time etc., etc.  We would be looking at 4 10-hour days.  My concern is an employee works M-Th (40 hours) - - Friday is a holiday - - how do I pay them?  Firm is in California.  Anyone have a policy manual on how this could be implemented?

Thanks for your help.

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Posted: 25 August 2008 04:16 PM   [ Ignore ]   [ # 1 ]
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I am not a California expert, but I believe that you would still have to pay overtime for all hours worked over 8 in a work day in California.  So if you want to implement a 4 day work week, you may be required to pay overtime at a rate of 8 hours per week.  Check with a labor attorney who specializes in California Law. 

If it is OK, then you would have to break the PTO, sick and vacation time into hours - not days and adjust accordingly.  The next issue is holiday pay.  A problem will arise here.  If you currently have the basic 6 paid holidays a year, this equates to 48 hours of paid time.  If you reduce this to 5 days, then you increase your holiday pay by 2 hours per employee.  Then you have to decide which 5 you will grant.  If you have 10 paid holidays, it is easier to reduce this to 8 holidays, but which two days will you take off the list? 

Another issue is the Monday - Friday holiday schedule.  Since Memorial Day and Labor Day are on Mondays, will the people who are scheduled to have Monday off be paid for the holiday or granted another day off at their choosing?  In 2009, July 4th is a Saturday and would normally be celebrated on the Friday before and Christmas and New Years Day fall on a Friday.  You have to think bout these things before implementing a 4 day work week. 

There’s no pat answer to these questions - but these have to be thought out before changing the work schedule.

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Bob McKenzie
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Posted: 25 August 2008 04:58 PM   [ Ignore ]   [ # 2 ]
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Apparently I can get around the overtime issue (over 8 hours in a day) by conducting a blind vote and if everyone is in agreement (and I know they are) then I have to register this work schedule with the department of labor - - apparently then it will fly.  You have hit the nail on the head with respect to vacation hours and holiday pay etc., etc. 

I have kicked around the idea of making vacation/sick and holiday pay something which is “purchased” by the employee—that they would accrue “benefit” time and they would simply choose how they spend it—two days off for Thanksgiving will cost them 20 hours etc., etc.  That seemed the easiest way to me - - but thinking it might become an accounting nightmare.

For one thing we do not pay for unused sick time - - but under PTO plan I think we would have to—harder to sell this one.

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