Resources: Workshare Programs

Workshare programs let businesses temporarily reduce the hours of their employees, instead of laying them off during economic downturns. Technically referred to as short time compensation, the goal of worksharing programs is to reduce unemployment.

Worksharing should not be confused with job sharing, which allows two part-time employees to share one full-time job. Instead, worksharing allows a full-time workers hours to be reduced, in lieu of laying off the worker.

Workshare programs benefit businesses, workers and states:

• Businesses retain their trained workforce, for easy recall to full-time work when economic conditions improve.
• Workers keep their jobs instead of being laid off, and collect reduced unemployment benefits to partially replace their lost wages.
• States save money by paying only partial unemployment claims, instead of paying full benefits to laid-off workers.

Under approved workshare programs, employees qualify for a percentage of unemployment benefits, equal to the percentage by which their hours have been reduced. For example, an employee whose hours are cut by 10 percent would qualify for 10 percent of the state’s established weekly unemployment benefit amount. While that does not fully replace the lost wages, the amount supplements a worker’s income until they are recalled to full-time work.

Source: National Conference of State Legislators