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Employers now have an easier way to participate in Work Sharing Program to retain workforce

October 14, 2020 1173

Quick Summary:

Assembly Bill 1731 requires the Employment Development Department to create an online portal that would make it easier for eligible employers to submit an application for work share. The Work Sharing program allows employers to retain much of their workforce and recover quicker.

Gov. Gavin Newsom on Sept. 28 signed legislation that creates an alternative way for employers to apply for and participate in the Unemployment Insurance Work Sharing program. Assembly Bill 1731 requires the Employment Development Department to create an online portal that would make it easier for eligible employers to submit an application for work share.

The Work Sharing program minimizes or eliminates the need for employers to lay off or furlough employees during periods when business demand is low. Under the program, employers can reduce hours and wages for individual employees, allowing those workers to receive partial unemployment benefits to cover the hours they are no longer working.

Because the Work Sharing program allows employers to retain much of their workforce, they’re able to quickly recover when business improves and avoid costly hiring expenses.

AB 1731 mandates that applications submitted by eligible employers through Sept. 1, 2023, that have been approved are valid for one year. EDD must also inform online applicants of their approval into the Work Sharing program within five days.

To be eligible for the Work Sharing program, employers must:

  • Have a legally registered business in California.
  • Have an active California State Employer Account Number.
  • Have a minimum of two employees and at least 10% of their regular workforce or a department of the workforce be affected by a reduction in hours and wages.
  • Reduce hours and wages by 10 to 60%.
  • Keep health and retirement benefits the same as before or must meet the same standards as other employees who are not participating in Work Sharing.
  • Have employees who agree to voluntarily participate in and sign the application for Work Sharing.
  • Identify affected work units to be covered by the Work Sharing plan and each participating employee by their legal name and Social Security number.
  • Notify employees in advance of the company’s participation in the Work Sharing program.
  • Estimate number of layoffs to be avoided by participating in the Work Sharing program.

Employers can apply for or renew a Work Sharing plan online or by mail with the Employer Work Sharing Application. Find additional information about the program in the EDD's FAQs.