In Praise of Long Hours
British firms, saying flexibility breeds prosperity, battle a European Union move to cap the length of the workweek
Andrew Willox's Goldstar Cleaning Services in Aberdeen, Scotland, is like one big family. Willox employs 30 full-time employees and 60 part-timers. Many have worked for him for 12 to 15 years, and he knows them all well. It's a seven-day-a-week business of long hours, requiring Willox to schedule workers to clean offices and nightclubs at all times of the day and night. So he regularly needs his full-timers-who work a minimum of 40 hours a week-to put in extra time, perhaps up to 55 to 60 hours a week. That's something most are eager to do, to earn the extra pay. "A lot of them want to buy their own homes, or a new car, or take their kids on holidays," Willox says. "So most of them want to work more hours when they can."
But a vote by the European Union's employment ministers in Brussels this week could be the beginning of the end of long workweeks in the United Kingdom and of extra cash for Goldstar's workers. The EU's Working Time Directive, passed in 1993 as a health and safety measure, caps the workweek at 48 hours. Most of the EU's 25 members signed on to it, but the U.K. and Malta have always exercised the option to opt out. Many members, however-and particularly France-say the opt-out option gives those countries an unfair advantage. They want it eliminated-and are proposing legislation to do just that.
Pressure. The split over the directive casts in bold relief Europe's differing approaches to remaining competitive in an increasingly global economy. Britain and many eastern European members of the union embrace the so-called Anglo-Saxon model of flexible labor markets and go-lightly regulation. France and its allies, however, argue that a more structured approach that protects workers' jobs and quality of life remains a viable and competitive alternative.
Certainly the U.K.'s economy is one of Europe's healthiest. Its 5.4 percent unemployment (the U.S. rate is 4.4 percent) is considerably lower than most of Europe's. France's jobless rate is a tough 8.8 percent, and within the entire Eurozone (which excludes Britain), unemployment stands at 7.9 percent. Britain says a big reason for its success is letting workers decide how much they want to work. Simon Briault, spokesman for Britain's Federation of Small Businesses, says small companies-which, like Goldstar, are especially dependent on flexible working hours-have been the country's job-creation engine, spawning 2 million jobs from 2000 through 2004. "Small businesses have propped up the U.K. economy," he says, and ending the opt-out would put that foundation at risk.
According to the International Monetary Fund, the growth of gross domestic product and productivity in Europe between 1996 and 2005 was far behind that of the United States. And globalization pressures on Europe come from developing Asian economies, too. Accordingly, cracks are appearing in Europe's jobs-for-life social model. To bring down unemployment, France in 2000 implemented a 35-hour workweek. It has not been a success. "It's coming under real pressure," says Simon Tilford, business analyst at the Center for European Reform in London. And in Germany last month, automaker Volkswagen got workers to agree to ditch a 28.8-hour workweek in lieu of heavy layoffs.
A matter of choice. Britain contends the 48-hour week is a sham because in most countries, short-term or multiple work contracts are used to skirt the law. "There are certainly ways people get around it; that just shows the weakness of the legislation," Briault says. Short-term employment contracts have become so prevalent in many sectors, especially automotive, that Eric Chaney, chief European economist at Morgan Stanley, jokes: "Carmakers in France have no employees on their payrolls." Struggling aerospace company Airbus has 7,300 temporary workers in Germany, a third of its workforce there. Nearly 15 percent of German workers overall are on short-term contracts.
Many economists say Europe's adherence to an outmoded social model leads to a so-called inside/outside workforce that protects older full-time employees but leaves younger, contract workers out in the cold. Says Paola Subacchi, an international economist at the Royal Institute of International Affairs: "It's protection only for people in full employment. Large numbers of employees do not get any protections." Tilford expects that if Britain's opt-out is canceled, U.K. businesses too will find ways to carry on as before: "It won't make much difference. People will continue to work what they want, and it won't change things."
Clearly, the Brits are a hardworking lot. Britain's Trades Union Congress says that they work an average of 44 hours a week, four more than workers in the 14 other original EU countries, and that 16 percent work more than 48 hours a week. But the workers don't seem to mind. A recent poll found that 52 percent of Britons reject limits on the workweek. The Confederation of British Industry says how much someone works is a matter of personal choice and a "basic right." But Paul Sellers, a TUC policy adviser, says overworked people are more prone to illnesses, and when it comes to health and safety issues, personal choice comes second. "Undermining your own safety can affect others," he says. Sellers also argues that heavy schedules are bad business. "Studies show when people work long hours, productivity drops off."
But Simon Mansell, managing director of TBG, a London Web ad agency, counters that long workweeks are often necessary to keep a business competitive. "The secret," he says, "is to reward staff for putting in extra time, so they see it as a benefit, not a chore." Goldstar's Willox says if the law changes, his workers will suffer. "I don't understand why they want to cut off my staff's chance to earn extra money."
There is the possibility of a compromise. Finland is pushing a plan that would continue the opt-out from the 48-hour limit but install a 60-hour-a-week ceiling. But, Tilford argues, any sort of limit "sends the wrong message" to potential investors that Europe's labor market remains too regulated. And in this instance, the U.K. would prefer to remain off message.
This story appears in the November 13, 2006 print edition of U.S. News & World Report.