From time to time, there’s news of companies introducing four-day work week. Magyar Telekom has been mentioned several times as the first big fish to do so, but Libri, too, has apparently done the same, as have various local subsidiaries of foreign parent companies. The obvious question is whether this option is available to everyone and, if so, at what price.
First of all, we need to clarify what a four-day work week is. In practice, the term actually covers several concepts or practices. Under one of these (the so called ‘English model’), the employees work four days a week, for eight hours a day, but they still get 100% of their previous (five-day) salary. This model is based on the idea that, assuming the work is done efficiently, the same amount of work can be done in a shorter period of time, thus resulting in a type of ‘salary increase’, as the working week has dropped to 32 hours. Under another common (so called ‘Belgian’) model, employees likewise work four days, but their working hours per day increase proportionately and they work the same 40 hours but now over four days instead of five. In this scenario, their salary (per hour) does not change. Under the third (‘reduced pay for reduced work’) model, employees work four days a week, eight hours a day, while their salaries decrease proportionately, i.e., they actually become part-time employees.
So, can we introduce a four-day working week in Hungary?
The answer from a legal point of view is clear: yes. Whichever of the above models an employer chooses, it is legally able to establish any of them in its business if it believes it supports the company’s working culture or other objectives of the employer.
More to the point, however, is whether the employer is entitled to introduce the four-day working week unilaterally, purely at its own discretion. And the answer to this is: it depends. Needless to say, a model in which the employee’s salary is reduced (in line with a reduction in working hours) and the employment contract is changed to part-time work cannot be introduced by the employer without the employee’s consent.
And as appealing as it may seem for employees, the so-called British model (where less work means the same salary for the same amount of work) cannot be introduced without the employees’ consent either. By having the employer reduce the 40-hour working week to 32 hours, but with the employee still being entitled to his or her full pay, the parties are in fact applying shorter full-time working hours, which is also something that needs to be mutually agreed in the employment contract.
The situation is more specific in the case of the Belgian model. Here, it will depend on the terms of the employment contract whether the employer is entitled to set the working time of the employee at, for example, four times ten hours instead of five times eight hours. In principle, it is the employer’s right and responsibility to determine and establish the work schedule, and so in general it is at the employer’s discretion to establish a different work schedule, subject to the employment contract and to any other restrictions specified in the Labour Code.
A plethora of legal problems
Whoever finally decides to introduce the four-day work week will, in addition to the changes mentioned above, find themselves faced with a sizeable number of additional legal tasks and, in certain cases, problems. We’ve chosen a few to highlight for you here.
For example, the issue of managing holidays arises. The number of holidays to which the employee is entitled does not change per as a result of the four-day workweek. The question is, however, whether holiday can be granted for the fifth day (when the employee is actually not performing work). So, if the employee has taken a two week-long holiday, is this now eight days’ or ten working days’ holiday? If, for example, the work week is four working days Monday to Thursday, can the employee say that he or she is only going to take holidays from Monday to Thursday and therefore this should be recorded by the company as four day long holidays and not five? Do the answers to the above questions vary for the different models? These are many questions that have not yet been answered precisely based on Hungarian labour-law practices.
It is also a question whether a four-day work week can be introduced if it is limited to a specific group of employees or to a specific site of the employer. For example, if the IT department’s work schedule is changed to a four-day work week, can the finance department demand the same for itself? Or is it possible, to designate certain members of staff in the IT department to whom the four-day work week will not apply? These questions can generally be answered from the starting point that no discrimination is allowed, and then looking at what is possible given the employer’s business, the nature of the work concerned, the workload implications, and so on.
Practical issues in introducing the four-day work week
It is clear that, in addition to the matter of its legal feasibility, a number of practical considerations need to precede the introduction of the four-day work week. Even if its introduction would not require an amendment of the employment contract, it is probably essential for its success that the employer consults the employees concerned in advance. Full transparency and information on the matter, including, where appropriate, consultation with employee representative bodies, should be provided for.
It may also be useful to first implement the system, if possible, for a pre-defined group of employees or for a pre-defined period of time, in order to test it. Based on the introduction of, or experimentation with, similar large-scale changes, it is likely – and experience bears this out – that a minimum of four to six months is needed to assess the impact of the reduced work week and its potential teething problems and to enable the employer to make a final decision.
By Dora Agnes Nagy, Attorney, Jalsovszsky
