CXO

Does a 30-hour work week make sense for your business? Lessons from Amazon

Amazon's 30-hour work week pilot may attract talented and diverse employees. Here's what you can learn from other companies who shortened the clock.

Amazon CEO Jeff Bezos

Image: James Martin/CNET

Amazon's recent 30-hour work week pilot announcement seems like a novel way to negate bad press and even increase workplace diversity. While it is the first time a tech giant has formally rolled out such a plan, other companies have quietly tested 30-hour work weeks and other flex schedules in recent years, with mixed results.

The move comes about a year after a New York Times story described how Amazon employees were expected to "toil long and late," working in an environment that prized constant availability and cutthroat competition.

"I think it's a great idea for them to try this," said Joe Rubin, co-founder of recruiting website Crowded. "Initially, it contradicts their press from last year, where they were portrayed as working their employees to the bone. If if works, they can tout their forward thinking, if not they can keep it going so it doesn't look like a failed initiative, though no longer put any PR behind it."

Amazon's pilot program will only involve a few dozen employees, according to the Washington Post, which first reported the story. The tech giant does not have plans to rollout this schedule company-wide, the story stated. Members on the team will be hired from within and outside the company.

SEE: Amazon spills the secrets of its success: Impossible goals and repeated failure

While the 30-hour Amazon workers will be salaried and receive full benefits, they will earn only 75% of the pay that full-time workers do, the Washington Post story said. The part-time employees will have the option to transition to full time if they chose.

Amazon currently offers part time jobs for certain positions, but this is a first for technical fields. It's also the first time that an entire team would be made up of part-time employees.

"The biggest benefit I can see is that it brings qualified people back into the workforce, such as people who left the full-time job to be a full-time parent," Rubin said. "The 30-hour work week lets them balance family and work life."

A diversity initiative?

The move could be an experiment to attract untapped talent to Amazon's workforce, according to Miranda Nash, founder and CEO of Qeople, a startup that matches director-level employees with companies for part-time positions.

"As a hiring manager in tech companies, I have used reduced-hour schedules as a way to attract and retain great people," Nash said. "With Amazon taking the lead with this pilot, I expect other companies that previously have used high-pay, part-time positions on a case-by-case basis will now think about expanding their available talent pool in a much more systematic way."

A shorter work week will likely draw more women to the company, and potentially other underrepresented minorities, said Rita Gunther McGrath, a professor at the Columbia Business School whose research focuses on organizational strategy and innovation. An infusion of diverse workers would be a boon for the company, which in 2015 reported that its global management team was 24% female and 76% male, and that 69% of managers were white.

"Amazon is trying to figure out how to tap into a new workforce," McGrath said. "There are talented people who don't want the all-consuming, 100% dedication of many tech jobs. If they can access that population, it opens up a new vector of talent they can bring to their organization."

The 30-hour work week pilot would follow a set of initiatives aimed at bettering work/life balance and increasing diversity, including an improved parental leave benefit policy introduced last year.

"Amazon can be a bellwether for other companies if they can figure out how to make this work," McGrath said.

Potential pitfalls

The US is not the first nation to explore shorter work weeks: In Denmark, workers average 33 hours per week, and are offered at least five weeks of paid vacation per year.

Most companies that attempted to institute a 30-hour work week in the past suffered due to reduced productivity, said Tjai Nielsen, associate professor of management at High Point University who studies leadership and work team effectiveness.

Employers sometimes theorize that a shortened work week will increase employee satisfaction while maintaining productivity, Nielsen said. "The reality of this theory depends on both the organization and the individual employee," he added.

While the majority of organizations operate on a 40-hour work week, many people actually work over 50 hours, especially given the ability to constantly check emails on your smartphone.

"The most significant challenge for organizations going to a 30-hour work week will be altering the implicit expectations of their managers, who are so accustomed to longer work weeks," Nielsen said. "For many organizations, this will require a change in their culture, which is far more challenging than most expect."

Employees may also have difficulty adapting to the new approach. While some will easily get as much work done in a shorter amount of time, others will find it more difficult, Nielsen said.

Large companies, including Yahoo and Best Buy, have taken a stab at the flexibility challenge, but few efforts have stuck, McGrath said. Most tend to try out a new schedule or arrangement for a while, and eventually return to a traditional way of working, she added.

"There are moments in a company's history when you can have a more flexible arrangement, and moments when you have to be together," McGrath said. "We haven't figured out how to reconcile the flexibility of a part-time work force with those times that everybody needs to be there."

Small company benefits

Smaller businesses may be better suited for 30-hour work weeks and flexible schedules than large enterprises, simply because it's easier to keep track of everyone's changing schedules, McGrath said. About 14% of small companies make a four-day work week available to all or most of their employees, compared to 5% of large companies, according to the Society for Human Resource Management.

A few years ago, The Pearl Source, an online pearl jewelry retailer and distributor based in Los Angeles, began offering its 34 employees either a 30-hour work week or a flex-time schedule. Both options continue to work well, said President Leon Rbibo.

"Our employees know what work needs to be done, and they always deliver," Rbibo said. "They still hit their deadlines. It's a relationship built on respect—we understand that people have lives outside of work."

Neil Andrew, an account manager at UK digital marketing agency Piccana, used to work in a corporate environment where it was common for employees to work over 60 hours per week, despite being salaried for 40 hours. "The majority of that time was wasted in useless meetings, and I felt like I was actually doing 20-25 hours of actual work a week," Andrew said.

Piccana began offering a 30-hour work week for its 14 employees with the same full time pay when it was founded in 2014. Employees are productive and report a strong work/life balance, Andrew said. And, the number of sick days taken by each worker is far less than at other companies, he added—over the past year, Piccana employees averaged 0.8 sick days each, compared to the UK average of 4.4.

The system isn't perfect; if a last-minute urgent project comes in, the team will work extra, Andrew said. And not all employees are suited to this shortened work time—they have to be highly motivated and able to prioritize their schedule, he added. The aim is not to work less, but work more efficiently, getting done the same amount others would in 40 hours.

"We could have gone down the route of paying 25% less, similar to how Amazon are doing it," Andrew said. "But our argument was that we expect the same level of output as a 40-hour work week, so we should pay for it."

The schedule will not work for every company either, Andrew said. "You need to be very good at managing people in order to get the most out of them if they're only working 30 hours," he added. "You also need to be incredibly thorough in your hiring processes to make sure it's the right people you're bringing in."

Still, he recommends that if you are in an office-based industry that lends itself to this, trial it for a month or so, paying employees the same amount but cutting ten hours off of their working week and examining productivity.

Shortened work weeks and flexible schedules will likely continue to be a part of the conversation for tech companies in the years to come, McGrath said.

"As we move into different kinds of working relationships between employees and employers, we do need to think about different models that work for people as well as for organizations," she added.

The 3 big takeaways for TechRepublic readers

  1. Amazon recently announced a pilot program allowing a few dozen technical workers to work a 30-hour per week schedule, with 75% of full time pay and full benefits.
  2. Many large companies including Yahoo and Best Buy have experimented with flexible schedules, but few have succeeded. If Amazon finds that it can attract more diverse workers who are productive on this schedule, it may pave the way for other tech giants to do the same.
  3. Small enterprises may be the best fit for a 30-hour per week schedule, as there are fewer employees to keep track of and manage, experts say.

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About Alison DeNisco

Alison DeNisco is a Staff Writer for TechRepublic. She covers CXO and the convergence of tech and the workplace.

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