LABOR DEPARTMENT URGES STRUGGLING COMPANIES IN CENTRAL NEW YORK TO USE SHARED WORK PROGRAM, AVERT PERMANENT LAYOFFS
Program Lets Employees Collect UI, Keep Health Benefits on a Reduced Work Schedule
Albany, NY (February 12, 2009) - Deputy Commissioner Bruce Herman, speaking on behalf of State Labor Commissioner M. Patricia Smith, today urged businesses in the Central New York and Mohawk Valley regions struggling with the current economic crisis to use the Department of Labor’s Shared Work Program, which gives employers an alternative to layoffs as they face a temporary decline in business. Rather than lay off a percentage of workers to cut costs, an employer can use this program to reduce the hours of all or a particular group of employees. In turn, employees can receive partial unemployment insurance benefits to compensate for their lost wages. Under the Shared Work program, participating employees do not see a reduction in their health insurance, retirement, vacation pay, or other fringe benefits. “New York State is facing its most difficult challenges since the Great Depression, and employers need to utilize every advantage offered to help them weather this economic storm,” said Commissioner Smith. “The Shared Work program is truly a win-win for employers and employees. Employers get to retain their workers and avoid painful layoffs, while workers are still able to earn a steady paycheck and retain the benefits depended on by themselves and their families.”
New York is one of 17 states currently utilizing this program, which helps employers avoid some of the burdens that accompany a layoff. In 2008, 462 employers statewide participated, up from 291 in 2007, with 51 programs active in Central New York and 27 programs in the Mohawk Valley Region. This translates to 14,775 employees enrolled in Shared Work in 2008, up from 10,300 in 2007, with 1,611 in Central New York and 913 in the Mohawk Valley Region.
If they keep employees during a temporary slowdown, employers can quickly gear up as soon as business conditions improve. This spares the business the expense and delay of recruiting, hiring, and training new employees.
Cheryl Saunders, Director of Administration for Dielectric Laboratories, Inc., said, “DLI and our employees have been most fortunate to have the Shared Work Program available on more than one difficult occasion. Each time was beneficial to the company and the employees. The company was able to maintain a skilled workforce while controlling costs and the employees were able to maintain almost all of their wages. It was a relief to have the Shared Work Program available during tough economic times.”
Peter Quinn, Human Resources Manager at Syracuse Castings, Inc., said, “Syracuse Castings is a small Central New York manufacturer with a dedicated workforce. We appreciate and care about the people who have made us successful. During these difficult and uncertain economic times, we would like to keep as many of our people working as we can. The Shared Work Program has allowed us to do just that.”
Randy Wolken, MACNY President said, “During these trying economic times, the Department of Labor’s Shared Work program is the type of temporary assistance some of our members need. The current economic crisis can be stifling and difficult for manufacturers, but by no means permanent. Programs such as Shared Work offer a temporary bridge that allows a company to maintain their current employees, and still scale back as necessary, until times turns around. I encourage all companies who are seeing temporary difficulties as a direct result of the economy to investigate using this important resource.”
The employer must have at least five full-time (35-40 hours/week) employees, and paid (or its predecessor paid) UI tax contributions for at least a year before applying to the Liability & Determination Section at least two weeks before the start of the program.
A Shared Work plan must include:
Employees who would normally qualify for regular unemployment insurance benefits in New York State are eligible to participate in the Shared Work Program. Because Shared Work is an alternative to layoffs, a plan cannot result in payment of more benefits than would have been paid if a total layoff occurred. Under the current Federal Extended Benefits plan, workers who were previously eligible for only 20 weeks of Shared Work benefits may be eligible for up to 40 weeks.
State Senator David Valesky said, “In these times, many employers face heart wrenching decisions, while workers and their families fear the loss of good jobs. The Shared Work Program can help them navigate these challenges, and is an excellent example of the bold and creative solutions we must take to protect our skilled workforce in Central New York. I support this program and the Department of Labor's proactive efforts to safeguard jobs and companies, and will continue to work to provide relief and stability for our hardworking men and women in the workforce and their employers.”
State Senator John A. DeFrancisco said, “This program provides New York businesses and workers with an appealing alternative. During challenging economic times, a program like this will help protect our workforce and provide workers with a greater level of job security. I am very pleased that the Department of Labor is promoting this program to Central New York employers and employees.”
State Assemblyman William Magnarelli said, "The Shared Work Program is an excellent example of how government and businesses can work together to find innovative solutions to pressing public problems. During these difficult economic times, this program will be a key tool in keeping people employed and ensuring a quick recovery once the recession ends. "
David Duerr, Executive Vice President of the Syracuse Chamber of Commerce said, “The Shared Work Program is a win-win for both employees and employers. During these uncertain economic times, this program is a way for employers to maintain their workforce while still taking the necessary steps toward recovery. Keeping people employed and maintaining a living wage is of paramount importance and the Shared Work Program helps employers achieve that. The Chamber is proud to support this program.”
Commissioner Smith continued, “We want businesses in Central New York and the Mohawk Valley Region to know that the Department of Labor and its services can be a great asset to them, and the Shared Work program is a prime example of this. We’re promoting this program for one reason – we want more employers struggling under the weight of this economy to sign up for it. Shared Work is unique in the way that it mutually benefits employers, employees and most importantly, the families they go home to every night.”
Currently, the State Labor Department uses a paper application from workers through the employer for the UI claim application and the weekly benefits certification through Shared Work. Within the next three to five weeks, the Department plans to offer participating employees the ability to file their original claim application via the Internet.
Companies can apply for the Shared Work program by referring to: http://www.labor.state.ny.us/ui/dande/sharedwork1.shtm
In addition, businesses interested in applying for the Shared Work program on behalf of its workers can call (518) 457-5807.