Maryland 4-Day Workweek Bill

A Maryland four-day workweek bill has been introduced.

If passed, it would create a pilot program — certain employers would be given tax credits to switch from a 40-hour workweek to 32.

The legislation in Maryland is part of a growing trend in potentially reshaping the norms of work. Similar pilot programs have been considered and implemented elsewhere, and the results could lay the groundwork for a new view of work-life balance.

Maryland 4-Day Workweek

The Maryland four-day workweek bill was introduced in early 2023. Lawmakers are expected to hold hearings this month.

Under the House version of the bill, the purpose of the pilot program is to:

Promote, incentivize and support the experimentation and study of the use of a 4-day workweek by private and public employers in the state.

“We have a real opportunity here to create a win-win,” Vaughn Stewart, a Maryland state delegate who sponsored the bill, told reporters. “We can make a shift toward reducing working hours without harming productivity, and possibly even boosting companies’ bottom line because they not only have improved productivity but retention and recruitment.”

Employers would be able to apply for tax credits if they shift at least 30 employees to a 32-hour workweek from 40. Companies would have to participate in the program for at least one year.

Participating businesses would be eligible for up to $750,000 in tax credits for each fiscal year. Certain restrictions would apply:

• A business could not have had prior plans to move to a four-day workweek
• Employees could not lose out on pay or benefits
• Participating employers would have information-gathering and reporting obligations

As might be expected, there would be several details to sort out, including the methodology to determine amount of the tax credit, how an employer would be able to structure the four-day workweek, what the data reporting would look like and other items.

Other Details on Maryland’s Four-Day Workweek Bill

The Maryland Department of Labor would administer the program and the tax credit, along with other responsibilities:

• Encourage governmental units to institute a four-day workweek
• Study and gather information on the impact of the program on qualifying employers and governmental units
• Conduct and promote research on four-day workweeks that exist outside the program, including those established overseas
• Facilitate public discussion with qualifying employers and governmental units that have instituted a four-day workweek
• Publish the data and reports required under the bill

If enacted, the Maryland four-day workweek law would take effect July 1, 2023, apply to tax years 2023 through 2027, and terminate June 30, 2028.

It would be the first of its kind in the U.S. (A California bill that proposed a 32-hour workweek stalled out in 2022.)

The Rise of New Employment Laws

The Maryland four-day workweek bill highlights the growing trend among legislators to craft and enact laws that benefit employees.

New minimum wage and paid leave laws, the continued rise of pay transparency legislation, protections for marijuana usage and more will likely continue in the coming years. (And, of course, many of these laws often associated labor law posters.)

With little activity at the federal level regarding employment laws, smaller jurisdictions across the U.S. are getting more active, and creative, with their legislation.

Conclusion

In an era when employee retention has become more important than ever, employers that operate in Maryland may want to keep an eye on the four-day workweek bill.

Increasingly, employees are choosing to switch to jobs that provide more flexibility, with hybrid work options being chief among them.

Still, as many employers are keeping an eye on the results of the four-day workweek trial in the United Kingdom, new ways to structure employees’ work schedules could be another wrinkle to consider.

This Employment Law News blog is intended for market awareness only, it is not to be used for legal advice or counsel.