Spain pilots work-week cuts to boost productivity

SPAIN has launched a project to help some companies cut their work week by at least half a day without reducing salaries, in an attempt to boost productivity.

The 10 million euro (S$14.4 million) plan covers small and medium-sized industrial companies. In the first-year pilot, the government will partly finance the wage costs of companies that reduce their working hours; it will also help to fund training and the cost of measures to improve productivity.

The Ministry of Industry said on Friday (Dec 16) that those requesting support under the project must design ways to increase productivity that compensate for wage cost overruns. These must be implemented within a year, and companies must maintain the programme for at least two years.

Companies with 20 or fewer employees must reduce the working hours of at least 30 per cent of their staff. For those with between 21 and 249 employees, at least 25 per cent must be part of the plan. Only workers with full-time permanent contracts can be a part of the programme, and women should be represented in proportion with their share in each company’s workforce.

Debate over the so-called “Scandinavian model” is not new. But the idea that productivity will rise if working hours are dropped gained traction among companies, the public sector and politicians during the pandemic.

Spanish telecommunications giant Telefonica offered its employees the opportunity to work a four-day week, extending a pilot programme that initially involved about 150 workers. However, this was in exchange for a 12 per cent pay cut. REUTERS