Federal Grants Awarded to Prevent Layoffs

Short-time compensation programs expand in 13 states with nearly $38M in grants to prevent layoffs

Work-sharing initiative seeks to reduce costly impacts on workers and employers

WASHINGTON — Losing a job is a difficult experience — fraught with uncertainty, fear and stress. Finding a new job is time-consuming and lost income creates a financial burden. For employers, layoffs can also be costly. Trimming staff when business slows means if new employees are needed when business picks back up, the employer faces the cost of training and lower productivity as workers acclimate.

With $37,814,386 in new U.S. Department of Labor grants, employers in 13 states will soon have a new tool that may help them avoid layoffs by helping states develop a new, or enhance an existing, Short-Time Compensation program.

The states of Arkansas, California, Connecticut, Illinois, Iowa, Massachusetts, Missouri, New Hampshire, New York, Pennsylvania, Rhode Island, Texas and Wisconsin are the recipients of the grants.[…]

Commonly known as “work sharing,” STC programs allow employers facing economic difficulty to reduce work hours for a group of employees as an alternative to layoffs. Programs allow workers with reduced hours to supplement their lowered wages with a percentage of the weekly unemployment compensation that would have been available to them had they been laid off entirely.

STC lets employees keep their jobs — and benefits such as employer-based retirement and health insurance — and helps employers keep skilled workers and avoid the costs of hiring and training new workers when business recovers. The program also eases the strain on local economies, which acutely suffer when layoffs occur.[…] Full release