With the recent suspension of all dine-in services at restaurants and bars, the closure of ski resorts, the shutting down of sporting events, and the stay-at-home order prohibiting employees from going to work—except those in “critical industries”—employers across the state are being forced to make difficult employment decisions while they try to ride out the COVID-19 storm. Even employers in “critical industries” are having to stagger hours amongst employees in order to comply with social distancing guidelines.
As a result of the stark increase in layoffs and hourly reductions, the state has seen an unprecedented number of unemployment claims filed within the past few weeks. In fact, these numbers far exceed those from the 2008 financial crisis. A big difference, however, between today’s rise in unemployment cases compared to the last recession is that many employers hope their workers will return soon.
That being the case, employers may opt to participate in Colorado’s Work-Share Program, which provides an alternative to laying off employees—particularly those expected to return to work at full capacity once this passes over. The Colorado Work-Share program allows employees of businesses affected by COVID-19 to keep working, but with fewer hours. While an employee is working fewer hours, he or she may be eligible to collect part of his or her regular unemployment benefits.
Some of the advantages for those participating employers include: the ability to retain experienced staff during this crisis, ease in returning to full production once restrictions are lifted, lowered costs for hiring and training new employees, spending less on unemployment, and the opportunity for their valued employees to keep their skills and move up in the business.
To be eligible for the program, employers must satisfy the following requirements:
- You are applying to be in the Program instead of laying off your employees.
- You are reducing the hours of at least 2 employees in a certain unit. You would have laid off at least that many employees.
- You are reducing the work hours of that group by at least 10 percent but by no more than 40 percent.
- You will not hire or have other employees work in that group.
- Your employees’ collective-bargaining agent (union), if any, must agree to the plan.
- You cannot get rid of or reduce employees’ benefits that you currently provide. These include health insurance, retirement/pension benefits, vacation pay and holidays, sick leave, and any other similar benefits you normally provide.
The state has released a fact sheet for employers interested in participating in the program. It can be found using this link: https://www.colorado.gov/pacific/sites/default/files/WorkShareInfoEmployers_0.pdf
If you want to know whether you qualify for the program or need advice related to the COVID-19 impact on your business, please contact FGMC attorneys. We understand the difficulties employers are facing during this crisis and are keeping up to date with all the government programs and options offering relief.
Associate