Public and private employers in Maryland would have an incentive to shift to a shorter workweek under a pilot program proposed by the state legislature on January 18, 2023. The Maryland proposal, known as, the “Four-Day Workweek Act of 2023” (HB 181), would establish a four-day workweek pilot program to promote, incentivize, and support the experimentation and study of the use of a four-day workweek by private and public employers.
Participating employers may be eligible for a tax credit of up to $750,000 per fiscal year against the state income tax. Qualifying employers would be limited to two credits if they transition at least 30 employees from a five-day workweek to a four-day workweek without reducing pay or benefits. To receive the tax credit, employers would have to allow the department to conduct employee surveys and interviews to study the impact of their transition to a shorter workweek.
If approved, the program would become effective on July 1, 2023, and would be overseen by the Maryland Department of Labor.
Next Steps for Employers
There will not be a one-size fits all, and employers will need to consider whether a four-day workweek would align with their industry, business operations and culture. Those considering participation in the pilot program should consider whether their four-day workweek would still consist of a 40-hour workweek or be reduced to 32-hours or less and how they’d transition some or all of their workforce to a four-day workweek schedule. If implemented, employers should develop and implement a written policy and procedures that thoroughly outlines the businesses’ four-day workweek program.