Texas awarded $2.8M to improve and expand work-sharing program

The U.S. Dept. of Labor announced Monday that Texas has been awarded $2.8 million to enhance and expand its short-time compensation program (STC), which is designed to help prevent layoffs through “work-sharing”. STC programs are administered through the federal-state unemployment compensation system and allow employers to reduce employee work hours during tough economic times as an alternative to laying them off. Through the STC program, employees who have had their hours reduced receive some percentage of the weekly unemployment benefits that they would have received if they had been completely laid off.  

According to the Dept. of Labor, the program is a “win-win” for both employees – who keep their jobs and benefits – and employers – who don’t have to hire and train new employees when business picks back up and can maintain continuity. The negative effects layoffs can have on local economies are also avoided.

“Short-time compensation programs help businesses and employees maintain a level of economic security during volatile business cycles,” said U.S. Secretary of Labor Thomas E. Perez in a press release.

The funds awarded to Texas are part of a grant-based program with nearly $100 million made available through the Middle Class Tax Relief and Job Creation Act of 2012. According to information from the Dept. of Labor, grant funds are available to states for the “implementation or improved administration of an STC program or to promote and enroll employers in an STC program”.

“Texas officials are taking proactive steps to prepare for future economic needs by accepting this federal funding, and I encourage all states to evaluate whether they can benefit from this federal resource,” said Sec. Perez.

Each state has a designated allotment from the $99.75 million available: 2/3 of the money each state is allotted will be used to promote and enroll employers into the program, while the remaining 1/3 will be used to implement or improve a STC.

To learn more about STC programs, visit http://stc.workforce3one.org/.