What is a Work Share Program?

Mary McMahon

A work share program is a government program which is designed to help employers avoid layoffs by providing unemployment benefits to workforces with reduced working hours. Under a work share program, a company can retain all of its workforce, avoiding costs associated with rehiring and training new staff once the need for layoffs is over. Employment development agencies usually have information about specific work share programs for which an employer may be eligible.

Work sharing can help cut back costs without having to fire employees.
Work sharing can help cut back costs without having to fire employees.

During a period of economic slowdown, many employers are forced to cut costs by reducing the numbers of employees. A company which wants to cut the costs of employing people by 15%, for example, would lay off 15% of the workforce, under the agreement that these employees could be rehired once the slowdown ends. These employees are eligible for unemployment benefits, which can be costly for the government, and the company risks losing them to employers who offer them jobs.

Under a work share program, instead of releasing 15% of the workforce, the company in our example would instead cut hours across the workforce by 15%. The company would not be forced to let any employees go, but it would still meet the cost-cutting goal. For employees with cut hours, the government would provide partial unemployment compensation to reduce financial stress as a result of reduced salaries. In this example, employees would receive 15% of the benefits they were entitled to.

Usually, employees must work 30 or more hours a week to qualify for a work share program, and there may be additional requirements such as a minimum number of employees, or a minimum number of years in business, depending on the government involved. Employers who are concerned about losing employees and who would like to retain their workforce can consider a work share program as an alternative to temporary layoffs.

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This type of alternative work arrangement is most effective when employees are willing to cooperate. It may require some adjustment of duties and responsibilities, including job sharing and the temporary elimination of certain positions. Many people in the workforce are willing to endure reduced hours when they understand that the alternative may be layoffs, which could affect them or their friends and coworkers. Employers should make sure that their employees know how to access work share benefits when they set up a work share program, and it also helps to provide estimates of how long hours will be cut, and how the workday will be affected.

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