Proposal to change the workweek to 32 hours instead of 40 in California. Can it be approved?

The British economist John Maynard Keynes predicted in 1930 that thanks to increased productivity, the average workweek would be just 15 hours “a hundred years hence.” That clearly is not the case today, although the amount of time American worker put in on the job decreased by the 1980s, they worked almost 200 hours more per year in 2007.

However, a new bill introduced in the California Assembly could cut the workweek, at least for employees at large companies in the state. The standard workweek at companies with more than 500 employees would be shortened by eight hours to 32 without reducing pay.

California four-day workweek legislation

Assemblywoman Cristina Garcia, one of the co-sponsors of Assembly Bill 2932, cited the exodus of employees from the workforce in the wake of the covid-19 pandemic as the impetus of the legislation. “We’ve had a five-day workweek since the Industrial Revolution,” Garcia told the LA Times. Given the progress that society has made and the upheaval of the pandemic “right now allows us the opportunity to rethink things, to reimagine things,” she said.

The bill would affect roughly 2,600 companies in California, those with collective bargaining agreements would not be affected by the legislation according to Garcia. The workweek would be redefined under law to be 32 hours down from the current 40-hour workweek.

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Employees that worked more than the newly stipulated 32 hours would get paid time and a half for their overtime, just as they do now for exceeding 40 hours of work. Employers would have to pay double the normal wage for work surpassing 12 hours per day, or seven days a week.

Opponents say it will kill jobs in California

The California Chamber of Commerce in a letter said “the additional labor costs imposed by AB 2932 will be untenable for many businesses.” The organization has labeled the bill as a “job killer” not only for its cost to employers, but that it will also expose businesses to litigation unable to comply with wording for compensation of the proposed law.

The Chamber gives the example of how paying an employee the same wage for less work would result in nearly 90 percent pay increase per hour if an employee works a fifth day, which goes as follows:

“An employee making $20 per hour presently makes $800 after 40 hours of work. Now, they would be required to make $800 after just 32 hours of work, meaning their hourly rate would become $25 per hour, a 25% increase. If the employer needs the employee to work overtime, the regular rate of pay, becomes $37.50 per hour. A business would be paying $37.50 for every hour worked on the fifth day, an 87.5% increase from $20 per hour.”

This situation would be unsustainable for employers and lead to lower job growth according to the Chamber. It feels that the California Legislature’s assumption that large businesses can continue to absorb such costs is “deeply flawed.”

The four-day workweek bill is still in its early stages

The other co-sponsor of the proposal, Assembly Member Evan Low says that the legislation is a “work in progress.” The Labor and Employment Committee is reviewing the bill and no date has been set for a hearing.

Conversations are ongoing according to Garcia over exactly what the rules would be for salaried workers. “Now we have an opportunity for business and labor and workers to have an honest and frank conversation about what this looks like,” Low said.