My boss just told us all how this will “remove our lunch and break times and take away all holidays” trying to scare us. Leeches, all of them.
This is the best summary I could come up with:
Sen. Bernie Sanders (I-Vt.) on Wednesday introduced a bill to establish a standard four-day workweek in the United States without any reduction in pay.
A press release described the legislation as “an important step toward ensuring that workers share in the massive increase in productivity driven by artificial intelligence, automation, and new technology.”
“The financial gains from the major advancements in artificial intelligence, automation, and new technology must benefit the working class, not just corporate CEOs and wealthy stockholders on Wall Street.
“While CEOs’ wages continue to increase, our workers are finding themselves doing more, yet earning less than they have in decades,” Butler wrote in a statement.
“The Thirty-Two-Hour Workweek Act would allow hardworking Americans to spend more time with their families while protecting their wages and making sure profits aren’t only going to a select few.”
In the announcement, Sanders cited several pilot programs and studies that show productivity improving with a four-day workweek.
The original article contains 494 words, the summary contains 156 words. Saved 68%. I’m a bot and I’m open source!
It’s hard to imagine how an hourly worker is going to not loose pay; going from 40 to 32 hours.
When you’re hourly… you’re, you know, paid hourly. The pay rate stays the same and you loose hours, not pay. The effect is the same, but technicalities are then soul of the legal profession.
Hopefully it reclassifies weekly work hour threshold to be considered for full time benefits. Either way it’s going to be a bumpy ride. At least someone is trying something
The irs already defines full time as 30 hours per week or 130 hours per month.
The ACA and FMLA also use that definition as full time.
The only change would be to require paying OT at 32 instead of 40- but that will have consequences of reducing hours, and not improving pay.
I suppose we would have to raise the minimum wage, and since neither party wants that, it’s dead in the water.
Then the hourly rate is to be increased
Can’t really do that,
The US government isn’t party to private contracts. Can’t dictate terms in that manner.
Unless you literally want to socialize all economic activities everywhere.
That’s the need, then it’s just a matter of finding the way
I mean, they actually can. That’s a completely facetious argument. Laws can set standards without defining everything. It’s done all the time.
The US government isn’t party to private contracts. Can’t dictate terms in that manner.
Nonsense. Try writing a contract that makes someone your slave and see how enforceable it is. How do you think minimum wage works? Walmart is paying that out of the goodness of their heart? No… they are forced to by the feds.
The US government isn’t party to private contracts
Learn what at-will employment is and how much of the US is stuck with it
I’m fully aware of at will employment.
I fail to see how that helps with the 32 workweek. You’re not going to get a general strike, and there’s plenty of people who will happily move into that job.
If you’re fully aware of what at-will is then you’d know saying
The US government isn’t party to private contracts
Is silly when the overwhelming majority of employees in this country do not have a private contract for employment
Yes they do.
A contract is simply an agreement- in the case of employment, to provide work for payment. Even at will, that is a contract. The contract can be terminated any time at will by either party, but it’s still a contract.
Yeah, I don’t understand how the “no loss of pay” part is implemented either.
Even if there is something in the bill that requires overtime pay, that’s just a multiplier to the base wage. What keeps an unscrupulous employer from just dropping the base rate by 20%?
It’s not even a question of dropping the base rate.
Hourly workers are paid per hour. I mean it’s pretty basic, right. The terms of employment are your paid at a rate of x per hour.
They’re just going to cut hours- not pay. And it’s a bit ridiculous to expect that companies are going to just increase effective rates when they still need the same number of hours worked.
They’re still going to be paying for that labor. have to pay someone for the hours you can’t work because paying overtime is one of the carnal sins of middle Managment.
A 32 hour workweek just doesn’t translate well to retail or anywhere that’s not white collar office jobs.
And add to that, anybody who is already salaried is just going to end up working the same 40+ that they’re already doing.
Out of all those jobs I had, only 1 gave me anything for OT, and that was just TOIL, which is nice but not sufficient when you’re the only person in your position.
I know a guy that spent 2 or 3 years with some stellar spreadsheets; he just coasted turning out the data (which was right,).
that stopped when he shared the spreadsheets with a few friends… then he kept getting asked to fix other people’s spreadsheets. which… would be a cool gig; if people weren’t so awful at spreadsheets.
The article literally tells you that this was done before, to give us the 40 day standard we now have. It worked before, and the article also points out that other countries have recently reduced work weeks under 40 hours. How is it hard to imagine that something that factually has happened could happen?
Imagine I manage a business where my employees earn $1000 a week, working five 8-hour days. Suppose my profit margin per employee is 10%, resulting in a $1100 return for each one.
Now, if a new law mandates that I pay my employees $1000 for a 4-day workweek, my operation could start incurring losses. The question then arises: where would the necessary additional funds come from? Likely, I’d have to increase my prices. I’m open to considering this arrangement, but I seek clarity on the strategies to mitigate such financial gaps. Should a 4-day workweek lead to a 20% hike in prices, I’m uncertain about the benefits of this change…
I’m all for a more healthy work/life balances, but typically businesses don’t like to incur extra expenses, so I would predict if workers are present 20% less, businesses would charge 20% more to make up the gap, which means workers would end up needing to earn more money, which may lead them to work more hours, making this change pointless.
If this came with some consideration from the federal government, like “we will give a 20% tax break to businesses that do this” I would consider the idea funded and I think it may work. Otherwise, this just feels like voting our way into price increases.
I think you might be making a fundamental assumption that quality of each hour of the day is the same.
Maybe for a particular business it does not matter, they just need an employee on the clock to cover time that customers may come in, but I think many businesses have tried this out, and found that they get about as much from their employees in 32 hours as they do in 40 hours.
I think it helps to give people time to rest and deal with life so that they can be more focused and thoughtful when they are with you.
In manufacturing, there is a piece rate for every SKU. At places I have worked this is a very carefully tracked number, as it will inform the production rate which will then affect inventory. A gain of 20% would be extremely major.
If this ends up working out, awesome. I just fear that cost of living has risen so much lately and this will be weaponized into yet another excuse to charge consumers more. “Of course we have to charge more, our workers are here less!”
Do you think your overhead would also decrease if you only had a 4-day work week?
Look at it this way. Let’s say I run a widget factory. I have a worker, Joe, that I pay $1000/week to. Each day, Joe creates me a widget that I can sell for $220. That means at the end of the week, I have 5 widgets I can sell for $1100, yielding me $100 profit.
Now, we move to a 4 day work week. I pay Joe $1000. He creates me 4 widgets, still worth $220 each. I sell them for $880 total. I now lose $120 each week.
Under the current plan, it seems the guidance is that Joe will magically start working faster and produce more than 1 widget per day. If he does not, my other option is to increase the price of widgets or to decrease the amount of money I pay Joe.
So you won’t be able to steal as much of the value Joe creates from him and instead have to pay him a fairer share? Oh darn. You mean you won’t be able to live in luxury while others do the work for you?
Fuck off lmao
“Life of luxury” and “fair share” isn’t the defining situation for tens of thousands of small businesses across the USA.
I think if widget factories could have that tight of margins, the issues would be totally different.
No competent business owner would employ someone whose value could become non-viable with a fluctuation in fuel cost.
The average profit margin in the US is approximately 7%… a 10% margin is considered healthy. Fluctuations in fuel prices DO threaten businesses. That’s why you see fuel/transportation surcharges and price increases.
So in this example, the revenue is $1100 a week per worker. If the worker does make $1000 for that time, that does spell doom.
Let’s work it the other way. A typical business allocates 15-30% of its revenue to payroll. If an employee is making $1,000 a week, that means that if this widget factory was making enough to be a reasonably successful business in the US today, their revenue per worker would range from $3,333 to $6,667. This means the company would be “losing” somewhere between $667 to $1,333 a week by paying the same wages but losing 1 widget.
Overhead is not exclusively the $1,000 you pay Joe. It is also whatever else you pay to keep the factory in business and Joe working. Some of this, like electricity, will decrease when Joe is at work less.
Now if you consider that for decades the widget factories have been making more widgets, but paying the workers lower wages, we have a healthy widget empire more than capable of supporting a 4 day work week.
Examples like these are only helpful if we use realistic numbers. $1,000 a week for a worker’s wages is plausible. $1,100 in revenue from that work is not.
I used those figures for ease of understanding and easy math. At no point did I believe there was a factory somewhere selling widgets, or that a person named Joe was salaried as he built them. My overall point is that for all economics to remain the same, average productivity per worker per hour must remain the same, otherwise there will be price increases or other economic effects.
I used those figures for ease of understanding and easy math.
Easy, but not accurate and therefore misleading.At no point did I believe there was a factory somewhere selling widgets, or that a person named Joe was salaried as he built them.
No one thought you did… until now.My overall point is that for all economics to remain the same, average productivity per worker per hour must remain the same, otherwise there will be price increases or other economic effects.
Correct, things will change. The point is that the system can handle those changes. Price increases will happen, sure. But if we take a look at the year prior to [current year], prices tend to go up. Rather than use this as an argument against working fewer hours, or not paying employees more, we should be using the systems we have in place to provide as much benefit to people as is reasonable. Since the 4 day work week does work, (many examples of companies increasing productivity this way) this is a reasonable benefit to push for.
Edit: you said “but nobody’s explaining the economics to me”, here you go, here’s the basics of corporate financial management with real numbers and a tiny bit of macroeconomics at the end.
Wait, I don’t get it. You’re saying if you pay a worker 1000$ a week and get revenue of 1100$, then you have a profit margin of 10%. But that’s NOT profit margin (at least not the one one would use for analysis). Not to mention that those numbers are unrealistic because you’d be working at a loss for a very long time, almost guarantee.
You can’t just pull numbers like that and say, “unprofitable!”. Of course it isn’t. You made it that way.
Besides, you’re ignoring the rest of the expenses that often outweigh the payroll fund.
Back to what you called “profit margin,” I’d call it “Return on Payroll Fund.” It’s weird, I don’t like it, it ignores all of the other costs that go into creating a product, don’t use it. In financial management, we use RoS, which is EBIT/Revenue. That’s probably what you were thinking of. Another name for it would be “operating profit margin,” likewise net profit margin would account for ALL of the expenses and not just operating ones.
Now, let’s look at real numbers. I’ll take Nutrien’s 2023 audited financial statement as an example. (Numbers in brackets are what’s deducted to get what’s not in brackets) Sales - 29056 Freight, transportation, distribution - (974) Cost of goods sold - (19608) EBIT - 8474 EBT - 1952 Taxes - (670) Net earning - 1282
Out of cost of goods sold (2858) is cost of labour, let’s also add (626) from general administrative expenses, and just say it’s all wages.
Effective tax rate - 670/1952*100% = 34,3% (wow, that’s a lot for where I live, also ignoring mining tax for simplicity)
Let’s see what happens to our efficiency once the changes take effect.
All of costs can be divided into Fixed and Variable ones. Labour, in this case, is Variable because we can manipulate it by employing more staff to compensate for reduction in working hours and keep the sales at the same rate. (Contract workers are usually Fixed Cost, but it’s all relative, as no Fixed Cost is ever truly fixed.)
Going from 40 => 32, we have a 20% reduction in working hours. Mind you, this doesn’t mean there will be a 20% hit in productivity. It may be more, it may be less (most likely less), for simplicity let’s say it’s 20%. So, we need 20% more workers to compensate. (2858+626)*120%=4180.8
New EBT = 1952 + 2858 + 626 - 4180.8 = 1255.2 New net profit = 1255.2*(1-34.3%) = 824.7. Mind you, the effective tax rate will probably be lower if employment affects deductibles.
So, our net profit margin went from 1282/29056 = 4.4% to 2.8%. Looks bad at first glance, but it’s also a bad year. A year prior net profit margin was at whopping 20,3%, so a decrease from 4.4% to 2.8% would be nothing in comparison.
Will it result in increased prices? Yes, but it will also lead to economic growth, because more free time = people spend more money = companies earn more = companies grow faster, but so does inflation.
Will it result in increased prices? Yes
Awesome, this is the exact point I was trying to make. You can add further arguments that there will be mitigating factors to this, but my reflex was that if this legislation passes, consumers will see price increases.
or you can go get a real job, admit that private property is theft, and let joe sell his own widgets.
I don’t have to “let” Joe sell his own widgets. He’d be free to do that regardless. I guess your guidance is that the business should just die under this new model.
my guidance is that you don’t need to be profiting off of the labor of other people.
It’s typically my experience that a great number of people are not entrepreneurial. They just want to show up to work, do their job, get paid and go home. I’m not talking about coercion of anyone to be FORCED to work for a business. I am just trying to understand how this new legislation would work. My hunch that is if this was passed, consumer prices would increase 20%. If you believe otherwise I would like to understand more.
i’m just here to rail against the capitalist system. you can argue with someone else about the minutia of reformist policies.
Interesting, although none of this has to do with overhead, and by extension, my question…
“overhead” is that $1000/week I pay Joe. I’d love to understand this plan a little more, but so far no one is explaining the economics of it to me.
You are right in saying you have two option, pay Joe based on work output (i.e. decrease his pay for the 4 widgets he now produces or take less profit.).
But there’s more to you then just Joe and the widgets. There’s the market buying the widgets, now everyone is working four days, has the demand for widgets changed? If this is a market where the demand is increased, you need more widgets, you can sell them at a higher price and hire more workers to increase output. If the market has now shrunk, Joe’s reduced output is fine.
It took a lot of effort to reduce the work week down from around 80 where it was at the beginning of the century and from the purely economic perspective of “we will have less output and the country will fail” it didn’t. Businesses did and guess what, it’s likely because they weren’t viable to begin with. Most workers on minimum wage currently can’t survive an unexpected expense, the current system isn’t paying enough to begin with. I’d argue lots of business right now should fail, because they aren’t being run for those actually making the widgets. Joe is burning his labour for cash and the output is widgets. In this scenario, what are you doing to earn the $20? Supplying Joe the chance to make widgets? Is that worth $20 from Joe’s labour?
Joe now has 72 hours off to rest and use his time more wisely. Joe uses this time to further his education follow a career in a different field other than making widgets. This may not make him more productive but he is happier. Eventually he will leave with his further education and move onto something more fulfilling, or just using the extra day to spend more time with his kids or doing whatever recreation he really loves. He will work on having a fulfilling life. You will move production to Bangladesh and bunch of people you are paying $5 a hour will die in a widget factory fire.
In this scenario, what are you doing to earn the $20?
I own the equipment that produces the widgets. I pay the insurance policy that covers Joe getting injured at work. I pay for distribution and marketing of the widgets. If Joe feels like taking on all these responsibilities, he is free to quit his job and start a competing widget manufacturer.
No… $1000/week is Joe’s salary. That’s payroll. Overhead is things like utilities at your workshop/factory.
Actually, you’d need to charge 25% more if you only had 80% of the work to match your current profits (considering only the time and materials for that product and ignoring all other business expenses / taxes / etc.), since 1/0.8 = 1.25. If the worker makes 1 widget a day, you need 25% extra per day to make up the lost widget and still make 5 widgets worth of profit.
ignoring all other business expenses / taxes / etc.
…what business sector are we modeling where these are as negligible as you’re treating them to make this point???
If you’re just here to correct the math then fine but at least be honest about the reality of what you’re calculating
Yes, I was just correcting the math. There are a lot of factors here and I don’t know what the actual cost-benefit analysis would be.
Thanks for the correction. I believe my overall point still remains valid.
Even moreso than before! I’ll be watching this thread, I’m curious how people are modelling the economic outcomes here.
Let’s assess the effects this change could cause on real numbers.
Note: This is a duplicate of a part of a comment I’ve written here above as a response, but I don’t want it to be buried. Hope that’s fine
I’ll take Nutrien’s 2023 audited financial statement as an example. (Numbers in brackets are what’s deducted to get what’s not in brackets)
- Sales - 29056
- Freight, transportation, distribution - (974)
- Cost of goods sold - (19608)
- EBIT - 8474
- Interest - (w/e)
- EBT - 1952
- Taxes - (670)
- Net earning - 1282
Out of cost of goods sold (2858) is cost of labour, let’s also add (626) from general administrative expenses, and just say it’s all wages.
- Effective tax rate - 670/1952*100% = 34,3% (wow, that’s a lot for where I live, also ignoring mining tax for simplicity)
Let’s see what happens to our efficiency if the changes take effect.
All of costs can be divided into Fixed and Variable ones. Labour, in this case, is Variable because we can manipulate it by employing more staff to compensate for reduction in working hours and keep the sales at the same rate. (Contract workers are usually Fixed Cost, but it’s all relative, as no Fixed Cost is ever truly fixed.)
Going from 40 => 32, we have a 20% reduction in working hours. Mind you, this doesn’t mean there will be a 20% hit to productivity. It may be more, it may be less (most likely less), for simplicity let’s say it’s 20%. So, we need 20% more workers to compensate. (2858+626)*120%=4180.8
- New EBT = 1952 + 2858 + 626 - 4180.8 = 1255.2
- New net profit = 1255.2*(1-34.3%) = 824.7. Mind you, the effective tax rate will probably be lower if employment affects deductibles and/or grants tax privileges.
So, our net profit margin went from 1282/29056 = 4.4% to 2.8%. Looks bad at first glance, but it’s also a bad year. A year prior net profit margin was at whopping 20.3%, so a decrease from 4.4% to 2.8% would be nothing in comparison.
Will it result in increased prices? Yes, but it will also lead to economic growth, because more free time = people spend more money = companies earn more = companies grow faster, but so does inflation. If they can manage the inflation, I don’t see why this couldn’t be possible.
Reducing net profit doesn’t have any impact on pricing in capitalist markets. It’s not like capitalists have some specific profit percentage they are allowed to hit (unless they’re in a very regulated industry like grid or water supply). They want infinite returns, and they’ll increase prices as much as the market allows to generate more profits.
Capitalists don’t look at a net profit of 4.4% and say “yup that’s enough”, but if it were 2.8% they’d say “damn guess we have to increase prices for customers, I really wish we didn’t have to do this”.
They might increase prices as a retaliatory measure. The same way businesses slashed hours as a result of Obamacare. They didn’t have to, but it benefited them to, and they didn’t see a downside.
They might be able to increase prices, blame it on this law, and have people who are aligned politically with them put up with it and maybe even support their business more to “stick it to the libs”. They already do this with things like inflation, blaming it on Biden and then increasing prices far more than necessary.
Oh, yeah, absolutely. Price policy is a whole different topic. Only monopolies can afford to increase them just because they’re not meeting the expected quota.
Don’t know about “retaliatory measure”, it’s hard to imagine companies uniting like that over it. Usually, they just play by the rules, and those could be the new rules (strong emphasis on “usually”). In fact, if the management is competent, it’s likely that they have already accounted for it, just in case, after the news dropped.
Great idea, love it as a former factory worker myself. Hope it gets traction but let’s be real, it has a Republican Christian chance of getting into heaven to get enacted into law at least for now.
As a white collar worker, of love to see a bill that just sees white collar workers just get paid their equivalent hourly wage when we go over 40. Fucking crunch due to unrealistic manager bullshit schedules.
it has a Republican Christian chance of getting into heaven
Off topic, but, I love this as an alternative to “a snowball’s chance in hell”.
Sanders also pointed to other countries that have already made the move toward shortening workweeks. France has a 35-hour workweek and is considering moving to a 32-hour workweek, and Norway and Denmark have workweeks of about 37 hours.
The problem with this comparison is that those countries have socialized healthcare, so healthcare expenditures come from the tax pool. In the U.S., healthcare is privatized so if workers don’t get burnout, injuries, diseases from stress etc. that translates to loss of revenue in the healthcare sector (but not for the companies that don’t have to pay workers if they’re out sick), and many of the decision makers in the U.S. are invested in the healthcare industry so there’s an obvious conflict of interest there when it comes to anything that benefits the health and well being of Americans. And the numbers are pretty big when you consider how much more expensive healthcare is in the U.S. than in those above mentioned countries.
I appreciate Bernie and what he stands for. But, unlike pretty much every other developed country on earth, the US, aka the no-vacation nation, doesn’t even have universally available PTO. I’d start there.
May as well start somewhere and this is somewhere.
Start as extreme as you can, because you will end up compromising and getting less than what you asked for. The only question is: where is there line beyond which you won’t even begin to get a conversation started. Wherever you decide that line is, start your demands there, because you will have to give something up.
I try to like humans, but I hate this part of humanity more than nearly anything that isn’t an atrocity. If people would enter negotiations in good faith, and not having to play shitty games like this, I would like my fellow man far better. Then again, I also hate poker and other forms of gambling, and am probably in the minority about this.
Which will be struck down almost unanimously because the US government is a cesspool of liches and ghouls.
Those corporate liches and ghouls are going to trickle down wealth any day now. Any day.
I mean, yes? That’s kind of the point. This is how we shift the conversation and put pressure on politicians. Put these bills forward and make people vote them down on the record, so those votes can be used against them.
And how’s that been working out for you guys so far?
I mean, screwing with the Overton window has worked great for Republicans. It’s absolutely fair play to use the same tactic from the other side. Frankly, it should have been done the second it became apparent that Republicans in general were trying to push the window to the right.
I don’t see how this is a victory for the Overton window. When Biden is in power screwing with it in the other direction.
Honestly? Pretty well, relative to the “cry about it and do nothing” strategy.
Is that why your current “left” party, that’s in power has pumped more oil than any country to ever exist, has twice the migrants detained in cages than when trump left office, breaks strikes, and bends over backwards to supply arms to a country engaged in genocide?
I think you should be more honest about how well its working.
I’m sure all these things you just wrote definitely have no nuance or context to them
I’m sure you’re fine with it as long as it’s slightly better than the republicans lol. This is what decades of lesser of two evils politics gets you: evil.
Well it wouldn’t make sense to be fine with the worser option would it
And I’m not fine with it, but what’s the realistic alternative?
I’m not from the US btw, I just have a morbid curiosity watching it from afar
America doesn’t have a left party, what are you talking about? Do you think Bernie won the presidency or something?
Exactly.
Being realistic about the situation your country is in will make it easier to create realistic solutions. Pretending this did anything other than show that the left has absolutely zero power in the states is counterproductive to improving your country.
I am being realistic. Are you? Putting forward bills and forcing the corrupt and right-wing legislators to vote against them on the record is literally one of the biggest things that leftists have been calling for, for decades, that capitalist Democratic leaders have been suppressing, because it hurts their control of the party. Not doing this is exactly what right-wing Democrats want. Doing nothing is not a realistic solution to anything.
I’d argue it hasn’t truly happened yet bc half the voter base gets brainwashed by propaganda
Judging by what I’ve seen it’s well over half man.
Yeah seriously. Those fuckers barely work at all.
They literally sleep in the house or whatever you Americans call it that you have.
Yours sleep too.
Hey man, you ain’t gonna catch me sticking up for the shitshow that is Canadian politics.
We don’t deserve Bernie 🥺
He’d frown on you for saying such a thing. We absolutely deserve him, and more.
It’s ridiculously depressing he’s still considered the crazy edge-case in the government.
I do want this change, but this system is built off exploitation look at the child labor laws being rolled back.
