US Labor Department announces nearly $100 million in grants available for states to implement, improve short-time compensation or 'work sharing'

WASHINGTON – The U.S. Department of Labor today announced the availability of nearly $100 million in grants for states to implement or improve existing short-term compensation, commonly referred to as "work sharing," programs. This funding has been made available through the bipartisan Middle Class Tax Relief and Job Creation Act of 2012 signed by President Obama in February, which authorized states to set up programs to give employers an alternative to layoffs.

"Establishing or expanding work-sharing programs nationwide will help business owners better weather hard economic times by temporarily reducing their labor costs while still keeping their existing skilled employees," said Secretary of Labor Hilda L. Solis. "This program is a win-win for businesses and employees alike."

Work sharing allows employees to keep their jobs and helps employers to avoid laying off their trained workforces during economic downturns by reducing the hours of work for an entire group of affected workers. Workers affected by reduced hours can have their wages compensated with a portion of their weekly unemployment compensation payments.

The legislation requires each state to submit a complete application to the Labor Department in order to receive a grant. Any state that currently has an active short-time compensation program is eligible to apply if the state's law on work sharing conforms to Section 3306(v) of the Federal Unemployment Tax Act and its program is not subject to discontinuation.

Each state has a designated allotment from the total grant funds available. One-third of the allotted grant money for each state will be used to implement or improve a short-time compensation program, and two-thirds will be available to promote and enroll employers in the program.

The department will provide technical assistance through webinars and other methods to help states achieve the purposes of the grants. The department also will collect and disseminate successful practices based on program implementation as well as outreach tools developed as a result of these grants.

For more information and an application checklist, read the Unemployment Insurance Program Letter No. 27-12 distributed by the Labor Department's Employment and Training Administration at http://s.dol.gov/UR.

Editor's Note: A chart with grant amounts available by state and territory follows this news release.

Short-Time Compensation Grants Amounts Available by State/Territory