shared-parentingIt is that time of year when many employers are facing the possibility of short term layoffs? Did you know that you may qualify for an alternative to laying off valuable employees? There are currently 27 states that offer Short Time Compensation Programs also known as Shared-Work programs.

 

Short Time Compensation Programs allow employers to avoid layoffs by reducing the number of hours worked by some (a complete unit or department) or all individuals during slow periods. Under these programs employees would qualify for UI compensation benefits if they meet the eligibility requirements. Unlike partial unemployment that bases the amount of UI benefits on the wages received each week, the Shared Work participants would have the amount of benefits based on the number of reduced hours. For example; an employee that has his/her hours reduced 15% per week would qualify for 15% of their eligible UI benefits. The employee would receive the reduced wages from the employer and UI benefits from the state. These participants would meet the UC availability and work search requirements by being available for their regularly scheduled hours.

There are multiple benefits for Employers and Employees entering a Shared Work Program, including:

  1. Employers maintain a full staff for when business picks up.Reduces the need to hire and train employees.
  2. Productivity remains steady.
  3. Helps to retain experienced employees.
  4. Employees are protected from the financial hardship of a full layoff.
  5. Employees healthcare and retirement benefits are maintained.
  6. Possible reduction of benefit charges resulting in less impact on future rates.

There are  also disadvantages for employers who enter a Shared Work Program. These include:

  1. Overhead expenses are not reduced proportionately to the reduction in hours.
  2. Scheduling may be more difficult.
  3. Experienced employees who can locate full time employment elsewhere may be lost.
  4. Employers will be chargeable for UI benefits paid to employees if they are on total layoff or participating in a Shared Work Program.

Each state has specific rules for the application, duration, and requirements for employers wishing to enter a Work Share Programs. Most states require a reduction in hours of 10-60%. All states require that the employer complete an application with specific details as to the extent of the reduction in hours. These forms along with additional information may be obtained by visiting the states’ websites.
States currently offering Shared Work Programs: Arizona, Arkansas, California, Colorado, Connecticut, District of Columbia, Florida, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Nebraska, New Hampshire, New Jersey, New York, Ohio, Oregon, Pennsylvania, Rhode Island, Texas, Vermont, Washington and Wisconsin.

If you have questions, please contact Cindy Carr, our Employment Tax Specialist, at (800) 207-6926, Ext. 118 or ccarr@corporatecostcontrol.com.


Contact CCC to see how we can save your organization time and money.
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