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State Looks at Work-Sharing to Ease Layoffs

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MAP: About half of the states have work-sharing programs now. Courtesy WV Center on Budget and Policy.
MAP: About half of the states have work-sharing programs now. Courtesy WV Center on Budget and Policy.
 By Dan HeymanContact
November 26, 2012

CHARLESTON, W.Va. - During interim legislative meetings this week, state lawmakers will look at voluntary work-sharing. Instead of laying off employees when they need to cut costs, employers could collaborate with the unemployment-insurance system to keep people working at reduced hours.

Sean O'Leary, a policy analyst with the West Virginia Center on Budget and Policy, says that right now, a worker loses his job and collects unemployment. But he says under work-sharing, companies could cut back hours instead of workers, with unemployment making up part of the lost pay.

"They've got ten workers, they can lay off two. Or they can have all their employees work four days a week, and they'd collect unemployment benefits on the fifth day."

A draft bill was put on the agenda for a committee meeting today.

O'Leary says some lawmakers have asked if work-sharing adds a new burden, for employers or the unemployment system, but the program is voluntary and only kicks in if an employer asks for it. He adds the states that now use work-sharing say it costs the same, because it's just using the same money in a different way.

"If you're paying a tenth of a benefit to ten employees or a full benefit to one employee, it's the same amount that's being paid out. So then, the same amount's being charged back to the employer."

By making the system more flexible, O'Leary says, work-sharing has been proven to help employers and the economy as a whole.

"It allows employers to keep their work force intact. It allows them to keep employees that they value: they don't risk losing them. They're ready to ramp production right back up once the economy's going. And that allows for shorter recessions and quicker recoveries."

He says it's also good for workers, because they don't lose their skills, work habits or motivation after long stretches of unemployment.

"They're typically on work-sharing for a shorter amount of time than they are on unemployment benefits. They don't lose their job; they don't become detached from the work force."

About half the states have voluntary work-sharing programs now.

More information is at goo.gl/eHZxm.

Joint House/Senate Committee meets at 10 a.m. Mon. in the House Judiciary Committee Room (410-m) at State Capitol Bldg., 1900 Kanawha Blvd. E., Charleston.

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