This is how I often feel about the government’s decision-making with taxes:
Q: What’s the difference between death and taxes?
A: Congress doesn’t meet every year to make death worse.
Honestly, as a small business owner, you most likely feel that pain.
Take this for example: The U.S. Department of Labor (DOL) just introduced a new overtime rule.
Beginning July 1, salaried workers earning less than 43,888 a year will qualify for 1.5 times pay if they work more than 40 hours a week. That’s up from the current qualifying amount of 35,568/year. By Jan. 1, 2025, this extends to those earning under 58,656.
Now, we both know, for the small business owner, this is a problem. First of all, you don’t have teams of people to help you comply with every new government rollout. You also likely aren’t prepared to have to make those kinds of salary increases when you’re already shelling out everything you can for your employees.
That is why the NFIB is opposing this rule and planning legal action. But if they aren’t able to overturn the ruling, that also means you’ll need to re-evaluate your workforce and payroll to ensure you’re compliant with the regulations. That’s something we should absolutely discuss:
app.acuityscheduling.com/schedule.php?owner=19530343
Continuing the topic of government rules and how they trickle down to your Skagit County small business…
The four-day workweek is back in the conversation again, thanks to the bill proposed by Sen. Bernie Sanders in March. It’s not a surprising move, given the increased demand for flexible scheduling in the workplace post-2020.
While we wait to see if the bill gains any traction or not, I decided to look into the merits of this practice and how it could affect your business. Here’s what I learned…
Flexible Scheduling Proposal for Skagit County Small Businesses
An employee’s job is to give his or her best work every day. A manager’s job is to give the employee a good reason to come back to work tomorrow.” – Liz Ryan
Sanders’ proposed legislation aims to trim the standard workweek from 40 hours down to 32. Under this bill, employers would be prohibited from reducing their employees’ pay and benefits to offset the reduction in hours.
Workers eligible for overtime would receive extra pay for working over 32 hours in a week, and the reductions would be phased in over four years.
As you might expect, the reactions to the idea are mixed, and many are saying the bill won’t get very far in the Senate.
In case you’re wondering, the 40-hour workweek has been the standard in the US since 1940, two years after FDR signed the Fair Labor Standards Act into law to limit child labor and institute other workplace protections.
This law was part of a growing move toward shorter workweeks since the 1830s, when coal and textile workers began protesting 14-hour workdays. In 1869, government employees were granted an 8-hour workday by President Grant, and railroad workers got the same limit extended to them in 1916.
Henry Ford instituted the 40-hour workweek in his factories in 1926, 14 years before Congress made it law.
Now in an era when flexible scheduling is a higher priority and more widely given benefit for workers, that standard is being challenged again. Over half of workers (58 percent) say they’d take a four-day workweek over a raise, according to a Drive Research study.
Interest in the idea is high across the board, but, not surprisingly, there’s a generational trend in leadership buy-in. Millennials and Gen X leaders are more open to the four-day week (at 65 percent) compared to Baby Boomers (at 50 percent).
More surprisingly, that same article says that in companies where AI already plays a key role in operations, 93 percent of leaders are considering the four-day workweek or already implementing it.
But what kind of impact could it have on businesses like yours? Here’s what people are saying:
Benefits
- Advocates say top executives have pocketed the profits that technology has gained them in worker productivity and that these companies can afford it.
- A 2022 study in Britain tested the 4-day workweek in 61 companies from a wide range of industries involving 2,900 workers. 71 percent of employees reporting feeling less burned out, 39 percent were less stressed, and 48 percent were more satisfied with their job than before. Sleep went up as did mental health, and absences and sick days went down.
- Revenue-wise, the study found that participating companies reported an increase in revenue or no change at all. 92 percent of companies said they would continue with the four-day week, with 30 percent making it a permanent change.
Problems
- Proponents point out that businesses would have to hire additional workers whom they’re already struggling to find, while simultaneously operating on very thin margins.
- There are many industries that would be more dramatically affected than others, like manufacturing, where workers are needed to keep assembly lines running, or healthcare, where there are already labor shortages.
- It’s likely that the costs of paying workers the same amount for less time would ultimately be passed on to consumers.
- Some are suggesting alternatives with flexible scheduling, such as four days in the office with the fifth day at home or a 40-hour week spread over four days instead of five.
What do you think? Would the four-day workweek work in your Mount Vernon business? Are you seeing benefits to other kinds of flexible scheduling in your industry? I’d love to hear about how you’re navigating these issues from where you’re standing.
Staying flexible,
Steve Padgett