Capping the working week at 32-hours is a bad idea
Some in Olympia believe that we can cut the working week by 20% to reduce costs and improve productivity. Citing examples from companies like Microsoft who recently experimented with 4-day work week, they claim that with the reduced hours, we can have better employee satisfaction and still be competitive in the market.
While this may be true for some industries, it doesn’t work for everyone.
Consider hospitals, police departments, fire departments or other critical infrastructure industries. Limiting hours would certainly result in either higher employee costs or a lower quality of service. You can’t, as an example, spend 20% less time spent putting a fire out at your home. The job must be done right.
Senate Bill 6516 proposes a 32-hour work week and would require employers to pay overtime for hours worked over 32 hours at time and a half. From an employee’s perspective this sounds great, but there is a problem. It would increase the employer wage costs by at least 12%. In industries such as retail where the typical profit margin is less than 5%, many businesses would be forced to raise prices on consumers or lay employees off.
Similar to the minimum wage impact, the increased payroll costs could not be absorbed by many employers and they would be faced with a stark choice. They would need to reduce costs by reducing work schedules to under 32 hours, laying off full-time employees or by employing more temporary workers. Many employers, that are happy to provide benefits to full time employees, could no longer cover the costs. Government wouldn’t fare much better. The likely option would be to increase taxes to continue paying government employees to provide essential services.
For the employees now working 32 hours a week, they would find the cost of goods and services increasing and their dollar not stretching as far as it used to.
Many employers already operate on 4-day work week and offer 32-hour flexible schedules for their employees. They understand that sometimes flexibility is what it takes to attract and retain the best talent.
Together, employers and employees have already figured out how to make schedules work and still deliver great products and services. Senate Bill 6516 is legislation looking for a problem that already has been solved.