Some sectors may be able to use new technology such as AI and automation, but for other sectors it is difficult. Productivity can be difficult to increase. Also, if they employ more workers, there is the cost of hiring and training workers to take on the extra work. Firms may need to pay overtime during busy times of production when workers cannot easily be substituted. For example, The Royal Mail and the CWU union have negotiated a deal which aims to bring in the automation of production to cut workers’ hours from 39 hours a week to 35 hours without a reduction in pay. One way to enable a cut in hours without cutting pay is for unions and employers to agree to a deal which brings in new working practises and technology. He argued it would occur by free-market forces) ( Note Keynes wasn’t advocating a legal maximum working week. Keynes argued rising living standards would cause people to choose less work and more leisure time. It is interesting to note that in 1930, John Maynard Keynes predicted a time when the working week would be cut to 15 hours a week. However, this trend in falling hours stalled in the 1980s. Improvements in productivity and better technology have all enabled hours to fall and real wages to rise. In the UK in the mid-nineteenth century, a factory worker in the UK could work up to 16 hours a day, six days a week. In the late nineteenth century, in the US it was estimated the average working week was 60 hours per week. There has been a long-term trend in reducing hours worked. Penn Table of the University of Groningen Growth and Development Centre.
A legally binding 48-hour max working week helps prevent getting burnt out and preventing work overtaking people’s lives.Ī diagram showing fall in hours worked in US. Therefore a maximum working week helps to increase the quality of life – factors not measured by traditional economic indices, such as GDP and average wages. An argument for a maximum working week is that it enables more leisure time and reduces work-related stress. In July 2017, Unemployment in France was 9.7% – so the economy is still suffering relatively high unemployment.If productivity does rise to match the hour cut, there will be no need to employ more workers. The other logic of a maximum working week is that an employer will maintain the same wage – despite lower hours therefore, to afford this increase in real pay, there is an incentive to increase productivity – set higher output targets so the firm can get the same output from fewer workers.In practice, firms find it difficult to exactly replace a worker who knows the job well. However, this assumes that the firm will be able to hire equally skilled and suitable workers.A firm will find it more cost-effective to employ a new worker than pay overtime. The logic is that if a firm cuts the hours of workers, there will be a necessity to increase the number employed to make up for the fewer hours worked by each worker. In 2000, France had an unemployment rate of 12.5%. A motivation for the French law of a 35-hour maximum working week was the hope it would reduce unemployment. Britain currently has an opt-out so employers can ask workers to work more. The European Working Time Directive has a maximum working week of 48 hours.
The main plan is to leave the opt-out of the European Working Time Directive and for working hours to be included in legally-binding sectoral agreements, However, it is worth noting this plan did not set a legal limit – but an aspiration to negotiate lower hours without any real pay cut. Additional hours could be worked, but they had to be paid at an overtime rate of +25%.Īt the 2019 Labour Party Conference, the shadow chancellor John McDonnell proposed a maximum working week of 32 hours – within ten years. For example, in 2000 France passed a maximum working week of 35 hours. A maximum working week is a legal limit on the standard number of hours that can be worked in a week.
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