32hr week is fine, but what does he mean by no loss in pay?
The mandated work week is something a central regulator controls, and the pay is not.
The drop in productivity because of working 32hrs instead of 40hrs will be much less than 20%, that's for sure. Maybe there'll be no drop at all. That doesn't always translate to no drop in pay.
If by 32hrs we mean 4 days, then it frees that day for other workers (if we imagine any job with a physical workplace). The pay is a result of the balance of interests. It will become less.
And personally I'd say 35hr week is a better idea - as in 5 days of 7hrs .