More small businesses in Connecticut will be able to hold on to their employees during a rough stretch if the legislature’s Regulation Review Committee approves a proposal to expand the state’s shared work program.
The voluntary program provides employers with alternatives to layoffs if they are faced with a temporary decline in business.
Rather than having to lay off a percentage of their workforce to cut costs, participating employers may reduce the hours and wages of all or a particular group of employees. Employees whose hours and wages are reduced are then eligible for partial unemployment compensation benefits to supplement lost wages.
Under the shared work program’s current rules, employers have to reduce the hours of four or more employees in order to participate. The proposed regulatory change would lower the threshold to just two or more employees–meaning more small employers would be able to participate.
The idea was the result of a collaborative effort between CBIA and the state Labor Department.
Connecticut’s shared work program benefits employers and employees alike. It allows employers to adapt to volatile business cycles, avoid the expenses of having to train new workers when business eventually turns around, and create greater employee morale by avoiding the specter of layoffs.
Employees also benefit by keeping their jobs and economic security, holding on to health insurance and retirement benefits, maintaining their skills, and avoiding the hardship of having to look for a new job.
While the hope is for business conditions to improve over the coming months, this adjustment in the shared work program will give businesses one more option in dealing with unpredictable business cycles and the lingering effects of the recession.