How two companies in Spain moved to a four-day week without cutting salaries

Is it possible to introduce a four-day work week in Spain without pay cuts? Last year, the telecoms giant Telefónica and the fashion brand Desigual announced their decision to offer a third day of rest a week, but the measure was somewhat misleading: the deal involved a salary reduction at both companies.

But two tech companies are truly offering a shorter work week without any salary cuts. Two years ago Software DELSOL, a software developer from Jaén (Andalusia) that employs 185 people, became Spain’s first business to adopt a 36-hour week without reducing workers’ pay. It was followed in September of last year by a German software manufacturer called CIB Group, which has branches in Valencia and Las Palmas de Gran Canaria.

While the result of this initiative in Spain is still unclear, success has been reported in other countries. The Japanese division of Microsoft ran a month-long trial in August 2019 and productivity grew nearly 40%, the company reported.

“It is still too early to extract specific data,” said Yolanda Roca, spokesperson for the marketing department at CIB Group. “But we haven’t seen any negative effects on productivity, which may in fact have increased. The company has noticed a drop in absenteeism during working hours for private matters or medical appointments, since employees now try to do these things on Fridays.”

Roca added that their four-day policy is also attracting a lot of new job candidates. “There’s been a noticeable increase in job applications,” she said. In a recent news release, CIB Group CEO Ulrich Brandner said he was aware that not all companies can easily introduce such a model, but that it should quite feasible for software developers.

Company officials at Software DELSOL have more conclusive evidence after two years of experimentation with the shorter work week. “The experience has been positive,” said Ana Arroyo, head of People Selection and Development. The program required an investment of €420,000 and a 20% staff increase, she explained. “Absenteeism fell 20% the first year because people stopped using company hours for personal errands. It has also improved camaraderie and commitment to the company.” According to Arroyo, sales have been growing by an annual 20% since the four-day week was adopted.

A recent study carried out in Iceland with 2,500 workers on reduced working weeks of 35 to 36 hours and no salary cuts showed similar or improved productivity and lower stress levels among the staff.

Financial hurdles

“Of course it is possible to implement it, it’s already being done. The mistake would be to impose it and to make it a universal policy at Spanish companies,” wrote José D. Canseco, who teaches at EAE Business School, in an article published in June in the financial newspaper Cinco Días. “Not all companies can carry it out; those with more of a tech component or where digitalization has been adequately developed will have a much easier time.”

Cost is the main hurdle. That is why the Spanish government announced a pilot program in March 2021 offering 200 companies the possibility to apply for subsidies of €250,000 on average to introduce four-day work weeks without salary reductions. The program was made possible through €50 million in European Union recovery funds. But one year after its announcement, it has yet to be launched.

Existing legislation caps the week at 40 hours of effective work. This is an annual average, which makes it legal to work 42 hours one week and 38 hours the next. Sectoral agreement may define a new threshold, but it can never exceed the limit set by the Workers’ Statute. Spain does not have a law regulating the 32-hour work week, which gives added importance to case-by-case negotiations with companies.

“The most interesting part of the proposal is that it has put the issue of the work week on the agenda,” said Carlos Gutiérrez, head of studies and training at the labor union CC OO. In his opinion, reducing the work week represents “another way to distribute productivity” and it is crucial for the process to be “negotiated with the workers through collective bargaining.”