Companies Keep People to Be Fired With State Work Share

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http://www.bloomberg.com/news/2013-01-10/companies-keep-people-to-be-fired-with-state-work-share.html

Some states are adding a new twist to the old concept of unemployment insurance: Paying to keep Americans in their jobs rather than giving them cash when they lose them.

Washington state has subsidized incomes for dental technicians and plumbers while Rhode Island paid factory and health care workers when their employers couldn’t. Almost 460,000 jobs have been saved through such arrangements since 2008, the Labor Department estimates, and federal funding approved last year has more states signing on.

Instead of dismissal notices, employees get a shortened work week, with unemployment benefits partially compensating for lost wages. Popularly known as work sharing, the program holds out the promise of fewer layoffs and less painful economic downturns. For businesses, which get to retain experienced workers, it could mean the difference between success and failure.

“It’s been a godsend,” said Belinda Roberts, co-owner of Blue Crown Dental Arts in Kennewick, Washington, which credits the state’s program with saving the jobs of seven trained technicians. The dental lab signed on to work share in 2010 after orders dropped and now has seven employees on the program. “It’s kept the doors open.”