More and more companies worldwide are implementing a reduction of working hours in some form, while certain countries have adopted or are considering legislative changes to that effect. One of the novelties deviating from the traditional organization of working hours is the introduction of the four-day working week, with or without an extension of daily working hours. Analyses and inquiries show that the results are positive and it is expected that this tendency will continue in the future.
This trend is mostly reserved for developed countries, although similar initiatives have appeared in Serbia at the level of individual employers. This is expected to continue in the future, especially in international companies in the IT industry, which are facing a deficit of highly qualified workers. Reduction of working hours is thus becoming an additional “perk” used for attracting desired candidates and a part of employer branding strategy.
Leaving aside issues of practicality, efficiency, and other economic and sociological considerations, in this blog, we will deal with the legal implications of the four-day workweek within the Serbian legal framework, i.e., what is needed to implement it in line with the Serbian legal legislation, and other relevant legal issues which may appear in practice.
Treatment of such work hours organization under Serbian Labor Law
Per Serbian Labor law, full-time working hours correspond to 40 working hours per week. Exceptionally, shorter full-time working hours may be introduced by the employer’s internal acts, but not less than 36 hours per week. This automatically means that implementation of a four-day workweek would entail employment with part-time working hours in case a working day would last for 8 hours. Alternatively, daily working hours could be prolonged (e.g., to 9 or 10 hours) so that the total working hours per week correspond to the full-time working hours.
Employment with part-time working hours does not differ essentially from full-time employment, since employees enjoy the same rights in all material respects. On the other hand, an extension of daily working hours to 9 or 10 hours does not represent overtime work if the full-time weekly working hours are not exceeded.
Although in practice four-day workweek is often introduced informally and/or as a kind of pilot project based on certain internal policies, from a legal and procedural standpoint, the introduction of part-time employment or extension of daily working hours would require conclusion of annexes to the employment contracts to adjust the weekly working hours and their distribution. In addition, many employers have in their employment rulebooks rather inflexible clauses regarding working hours (e.g. that the work week consists of 5 work days with 8 working hours per day), which would need to be amended and adjusted to allow deviations from the typical organization of working hours.
Is it possible to apply it only to some employees?
Aside from procedural issues, the implementation of a four-day workweek raises certain material issues. For instance, is it allowed to implement the four-day workweek just for certain employees and organizational units, or all employees within the company would need to be included? In that context, it is worth emphasizing the legal principle of equal pay for work of equal value. Assuming that implementation of a four-day workweek entails a reduction of working hours (i.e., the introduction of part-time employment) without a proportional salary decrease (which de fact means an increase in hourly pay), it can be reasonably argued whether the said principle could be violated at the expense of employees who are not encompassed by the decrease of working hours.
This question cannot be answered simply and uniformly, because the notion of “work of equal value” requires differentiation of work positions and employees according to qualifications, responsibilities, work conditions, etc., to determine whether employees’ salaries correspond to the value of their work.
In nutshell, from the existing judicial practice it can be inferred that the courts do not accept claims based on the “equal pay for work of equal value” principle if there is a pay gap between positions that require different professional qualifications, knowledge, skills, or different level of responsibility. Consequently, salary increase (including indirect increase due to reduction of working hours) could be problematic if it would lead to unequal treatment of employees in the same or similar positions or positions which require the same skills and level of responsibility.
Consequently, if a four-day workweek is not implemented for all employees within the company, it is advisable not to apply it to individual arbitrarily selected employees, but to implement it on the level of organizational units, especially if they encompass work positions that differ from work positions in other organizational units in terms of area of work, complexity, qualifications, responsibility, etc. In this case, it would be difficult to prove the violation of the “equal pay for the work of equal value” principle. Naturally, the assumption is that such organizational units allow this type of working hours, having in mind the type of work, its organization, and business requirements.
Can it be implemented temporarily?
Another relevant question is whether a four-day workweek can be implemented for a limited time, i.e., whether “regular” working hours could be reinstated without employees’ consent? The Law does not specifically regulate this issue, just like it does not regulate temporary amendments to an employment contract in general. However, if at the time of implementation of the four-day workweek, it is indicated that this is a temporary arrangement, we believe that the employer would have legal grounds to subsequently offer another annex for reinstatement of former working hours. Depending on specific circumstances it can be considered that the application of an annex is temporary so that upon the expiry of the prescribed period such annex ceases to be effective.
In each individual case, employers are recommended to conduct a detailed analysis of the specific circumstances for the specific workplaces for which this type of work is planned, before introducing new work modes, such as the needs of the business, the undertaken obligations to their clients, the needs of various projects and other relevant circumstances.
From the legal point of view, it is necessary to determine the model that is adequate in the given circumstances and implement it in a way that will not lead to side effects and/or disputes.
In practice, different models are encountered by which employers try to somehow test various flexible forms of work, including the temporary shortening of the working week in several ways, often all of which are carried out extremely informally outside the procedure required by law. Employers should exercise caution in such practices so as not to unnecessarily question regulatory compliance and the integrity of internal procedures or even inadvertently violate certain employee rights.
Finally, if certain employees would be switched to part-time working hours while at the same time being expected to complete the same tasks as previously but for a shorter time, that could efficiently not be a benefit but an increase of working tasks so employers should be careful when defining work requirements and assessing work performance.
Time will tell whether the idea of a four-day workweek will catch on in practice and to what extent. Presently, such initiatives are primarily reserved for high-paying jobs where work disputes are relatively rare (due to the high demand for workers and relative ease of finding a new job). Nonetheless, risks of non-compliance cannot be overlooked, especially for companies that tend to grow quickly in terms of the number of employees, which increases the risks exponentially so it is necessary to carefully prepare all details and follow the prescribed procedures of employment law.
Damjan Despotović, partner
Srećko Vujaković, partner
This text is for informational purposes only and is not legal advice. Feel free to contact us if you need additional information.