Senate approves reform to help avoid layoffs

LANSING — Legislation aimed at helping job providers avoid laying off workers was approved Wednesday by the Michigan Senate, said state Sen. Goeff Hansen, R-Hart.

“This measure will allow job providers to retain highly skilled workers during times of reduced demand,” Hansen said. “Additionally, getting this proposed law on the books would benefit Michigan’s hard workers, as it can help them avoid the emotional and financial hardships of being laid off.”

Senate Bill 1094 would create a work share program allowing employers to avoid layoffs by reducing the hours of employees and supplementing their pay with partial unemployment benefits.

Under the proposal, to be eligible to apply for a work share plan, an employer must be up to date on quarterly reports and unemployment tax payments, have a positive reserve in its experience account and have paid wages for 12 consecutive quarters prior to application.

Employers applying to the Michigan Unemployment Insurance Agency (UIA) for a work share plan must promise not to lay off participating employees or hire new employees into the affected unit. Furthermore, employers must certify that they obtained the approval of collective bargaining representatives and notified employees.

Lastly, employers must certify that implementation of the plan is in lieu of layoffs that would affect at least 15 percent of employees in the affected unit.

Participating employees would have their normal weekly hours reduced between 15 to 45 percent; the reduction must be the same for all participating workers and cannot be changed during the plan, unless modified with the UIA.

Employees participating in a work share plan would receive partial unemployment benefits to supplement their reduced income. Benefits would be calculated by multiplying the employee’s weekly benefit rate by the reduction percentage.

For example, an employee eligible for $362 in weekly benefits with hours reduced by 20 percent would receive 20 percent of the weekly benefits, or $72.

Currently, 22 states and the District of Columbia have a work share program in place.

“Having a work share plan will help job providers avoid the costs associated with recruiting, hiring and training new employees when business improves,” Hansen said. “I strongly encourage my colleagues in the House to take swift action on this bill and send it to the governor for his signature.”

SB 1094 now advances to the House of Representatives for further consideration.