Experimenting with new workplace models
Smokers cost U.S. employers $170 billion for medical care, and more than $156 billion from lost productivity every year, the Centers for Disease Control and Prevention estimates. One company is trying a drastic way to cut down on its healthcare costs.
U-Haul late last year said it would no longer consider job prospects who use nicotine products in 21 states where it is legal to do so. The policy went into effect in February, providing a test case on whether the strategy will be effective in lowering healthcare costs — and whether it will unleash a backlash. The strategy may present a slippery slope for employers. If smokers can be banned, what about alcoholics, the obese and those deemed to be unhealthy? And who would determine that?
The Equal Employment Opportunity Commission already is deciding whether to allow companies to inflict financial penalties on employees who don’t comply with wellness programs. Employers currently can under the Affordable Care Act, but the courts are debating whether it conflicts with the Americans with Disabilities Act.
Associate editor Kayla Webster spoke with legal experts who also questioned how anti-nicotine hiring policies affect industries that rely on blue-collar workers. “When discussing this news with our employers, one member with a manufacturing workforce indicated that they wouldn’t have an applicant pool if they implemented a similar policy,” says Michael Howard, president and CEO of the Alabama Employer Health Consortium, a coalition of employers from across the state.
While U-Haul’s policy is marketed as a wellness initiative, various experts speculate the decision was made to cut down on the costs associated with having smokers on staff, Webster reports.
That’s just one story of employers trying new strategies to face challenges of the modern workplace. Our main feature looks at another experiment that began in Japan. Perhaps it’s not so surprising that a country known for long work hours and a workaholic corporate life is leading the way on innovation to improve its workplace culture.
In Japan, workers dying from overwork happens so much that there’s even a word for the phenomenon: karoshi, or death from overwork. The problem sparked a national debate on the issue a few years ago when Miwa Sado, a 31-year-old journalist for Japan’s public broadcaster, NHK, died of a heart attack in July 2013 after she logged more than 150 hours of overtime in one month. Labor inspectors later ruled that her death was attributed to karoshi.
This past summer, Microsoft Japan drew more attention when it began experimenting with a four-day workweek, with promising results. The tech company reported a 40% increase in productivity after implementing the shorter schedule. Andrew Barnes, founder of the New Zealand-based investment advisory firm Perpetual Guardian, says the concept of a four-day workweek has reached a “tipping point,” with employers such as Microsoft, Shake Shack and others experimenting with the abbreviated schedule; Finland’s prime minister recently also suggested, in a tweet before she was elected, that a four-day work week or six-hour work day may be a more productive model. Sweden already has tried a six-hour workday and found that productivity improved.
Barnes recently dropped by the Employee Benefit News newsroom and spoke with associate editor Amando Schiavo, who writes about Barnes’ own experience of shifting his company to a shorter workweek. “Because we’ve seen the benefits in our own business, we think it’s something worth pushing,” Barnes says. “We got a 40% improvement in engagement, stress levels dropped by 15% and more people said they were better able to do their job.”
Mariam Lacey, a professor at Pepperdine Graziadio Business School, writes in a guest column in support of the concept, and rightly notes that the idea is far from new. Experts as far back as 1950 espoused the idea, with some predicting the U.S. would reach a 30-hour workweek by 1980.
That clearly did not come to pass, but something does feel different this time, sparked in part by generational change. Finland Prime Minister Sanna Marin is only 34, and brings with her a perspective that comes from an expanding cohort of Gen Y and Gen Z workers. Amid the growing ranks of a new generation of workers, the pressure for more change is on.