State and Federal Policymakers Explore Work Sharing, an Alternative to Layoffs

Jun 11, 2010

By Neil Ridley

Colorado this week became the 19th state to adopt work sharing - an unemployment insurance program that provides an alternative to layoffs by allowing employers to cut employees' hours instead of slashing the number of employees on their payrolls.

Gov. Bill Ritter Jr. signed the Colorado Work Share program into law on June 9.  Citing the need to grow the state's economy, support businesses, and create quality jobs, Ritter at a state-wide conference said, "As tough as the economy is, we must maintain our commitment to collaborate and bring people together around economic development, workforce development and education."

Work sharing, also called short-time compensation, is a win for all: Businesses retain skilled workers, employees retain their jobs, and communities minimize the number of layoffs during tough times. For example, businesses can reduce all employees' hours by 20 percent instead of laying off a portion of the workforce. Workers then receive partial UI benefits to help compensate for lost work hours. Although they work fewer hours, employees retain benefits such as health insurance. Communities, in turn, can avoid the harsh economic impact of widespread layoffs.
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