‘Populist thought bubble’: Union movement to push for four-day week despite criticism

The federal government has shrugged off the union movement’s push for a four-day workweek at the Albanese government’s economic roundtable as businesses derided it as a “populist thought bubble” that would burden employers.

Australian Council of Trade Unions president Michele O’Neil will cite academic research that argues businesses can achieve greater levels of productivity if they cut working days by fifth at the roundtable that will run from Tuesday next week.

O’Neil’s push for the popular workplace policy has escalated a clash between unions and employers on what is the best approach to improve productivity ahead of the roundtable, where there are vanishingly few areas of agreement across the labour divide.

Prime Minister Anthony Albanese told reporters in Brisbane on Wednesday that many people would like a shorter workweek, but he had no plans to adopt such a proposal.

“The ACTU, of course, is entitled to put forward whatever ideas it likes,” Albanese said. “But that doesn’t mean, as I’ve said, that it’s government policy because someone put forward an idea.”

The council’s plan would apply to businesses that can feasibly operate with staff doing four-day weeks. It would come with protections for pay and conditions to ensure that reducing the number of days worked did not result in a loss of pay.

O’Neil said she wanted different groups to be open to the proposal at the economic roundtable, beginning on Tuesday.

“It’s a way of sharing productivity improvements that will really benefit workers and their families, but also it’ll be good for business,” O’Neil said.

Australian Industry Group chief executive Innes Willox said the timing of the ACTU announcement, after the Reserve Bank of Australia revised down its productivity assumptions on Tuesday, was poor.

“Unions have offered up another populist, anti-productivity thought bubble with a proposal that employers must bridge a four-day workweek … but maintain wages,” he said in a statement that was echoed by other business groups, including the Australian Chamber of Commerce and Industry.

The ACTU cited a 2023 Swinburne University study that found 70 per cent of firms trialling the four-day week reported higher productivity. The rest found it remained stable.

The ACTU used another study, published in Nature Human Behaviour, that found the four-day week boosts performance, reduces burnout and improves employee health and retention. The study examined 2896 employees across 141 organisations in Australia, New Zealand, Ireland, Canada, the United Kingdom and the United States.

Workplace Minister Amanda Rishworth said the Albanese government had legislated to let staff ask for flexible working hours but did not endorse the council’s proposal.

“We want to make sure that the industrial relations framework allows employers and employees to work on flexible arrangements, as long as people don’t go backwards in their pay,” Rishworth said.

Consumer goods company Unilever and health insurer Bupa trialled a four-day workweek and a nine-day fortnight, respectively, for several years but both companies recently decided to end the working arrangements. The ability to request a four-day workweek was included in furniture retailer IKEA’s most recent enterprise agreement, which it said had helped it attract staff.

Andrea Tuckey, head of provider strategy and delivery at Medibank, is trialling a four-day workweek. She said it has made her and her team reprioritise work and cut unnecessary meetings.

“It’s been a really positive experience for our team, we still produce the same outputs,” Tuckey said. “But what it’s done is lifted this concept that you have to be at your desk for 8 hours every day and how you choose to get to your outputs – you can go about it in any which way you like.”

Nick Cantor, co-founder of marketing firm The Walk Agency, also trialled the four-day workweek and said his company had healthy profit margins despite reducing staff hours.

“It asks people to think about their work deeply, to think how you can do this more efficiently, how you can take this further in the moment that you’re doing it,” he said.

Commonwealth Bank chief executive Matt Comyn, who will attend the government’s economic summit in Canberra next week, also pushed back against the proposal and said the immediate focus should be on how to increase productivity.

“I think it would be premature to conclude that that’s an appropriate policy given the challenges that are ahead,” Comyn said of the ACTU proposal.

“To reduce work hours by 20 per cent, you’re going to need a 25 per cent increase in productivity.

“Let’s focus on the policies that deliver the productivity benefit, then we can think about how to best distribute those benefits.”

Despite the criticisms, O’Neil remained positive about the potential to negotiate.

“This is something that unions have been negotiating with companies and employers over quite a long period of time now, and it’s not a one-size-fits-all [plan],” she said.

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