It’s called Work Sharing Unemployment Insurance. Employers, both large and small, can choose to take part. Talbott Smith is with the state’s Employment Development Department. He says a lot more employers are doing just that.
“Interest in the program sort of follows the economy. It has jumped back up recently very, very rapidly.”
In fact, EDD has seen a 127% increase in the number of employee claims filed over last year and a 300% increase over 2007.
The way it works is, if a business owner needs to cut their payroll by 20% for example, instead of laying off workers, they reduce the hours and pay of their staff by 20%. Those employees then get work share jobless benefits.
Smith says a lot more smaller employers like dentist’s offices and car mechanics are participating.
“Because during a recession like the one that we’re in, people will make decisions to postpone things like dental work, they may not get their car fixed.”
But there’s one group of employees who aren’t eligible for the benefits: state workers.
“The employer has to choose to participate and the State of California as an employer has not applied to take advantage of the Work Sharing program.”
Smith says he expects demand for the program among private employers to keep rising as the recession continues.