An employer/business owner may use Shared Work in lieu of a temporary, total layoff of employees. It allows for a partial workweek and partial unemployment benefits for employees. It is not available for seasonal layoffs. Information about program eligibility and an application to join the program follow.
A Layoff Alternative
The Employment Security (Unemployment Insurance) Shared Work Program is designed to help both employers and employees. It is an alternative for employers faced with a reduction in workforce and allows an employer to divide the available work or hours of work among a specified group of affected employees in lieu of a layoff. Shared Work allows the employees to receive a portion of their unemployment insurance benefits while working reduced hours.
To participate, an employer must have reduced the normal weekly work hours for an employee in the affected unit by at least 20 percent (but no more than 40 percent) and the plan must apply to at least 10 percent of the employees in the affected unit who meet the monetary requirements for regular unemployment compensation (See Payment Information). If the plan is approved by the Kansas Department of Labor (KDOL), workers who qualify for unemployment benefits can receive both wages and Shared Work benefits. The Shared Work benefits are the percentage of regular unemployment benefits matching the reduction described in the employer's plan.
An interested employer may obtain a Shared Work Plan application by contacting KDOL at (785) 291-6132. The link to a printable application is found below.
What happens once the application has been filed?
Once the plan is approved, a certification form is mailed to the employer for completion. Certification forms continue to be mailed to the employer each week the plan is in effect.
A firm facing a 20 percent reduction in production may consider laying off one-fifth of its work force. Instead, when faced with this situation, the company can retain its total work force on a four-day-a-week basis. This reduction from 40 hours to 32 hours cuts production by the required 20 percent without reducing the number of employees. All affected employees receive their wages based on four days of work. In addition, those employees can receive a portion of unemployment compensation benefits equal to 20 percent of the unemployment compensation weekly benefit amount payable had the employee been unemployed a full week.
An employee normally works a 40-hour week. The employer reduces the work schedule by 20 percent. The employer submits a plan for this reduction to KDOL and is approved under the Shared Work Program. For purposes of this example, the employee qualified for regular unemployment compensation with a weekly benefit amount (WBA) of $190.
20% of 40 hour work week = 8 hours
Employee works and earns wages for 32 hours
20% x $190 WBA = $38
This employee would receive $38 in unemployment benefits in addition to the 32 hours of wages earned during the week.
The Conditions the Kansas Department of Labor may approve a Shared Work Plan if:
- There is an "affected unit" of two or more employees.
- The normal weekly hours of work and corresponding wages for a participating employee are reduced in the plan by not less than 20 percent and no more than 40 percent.
- The plan applies to at least 10 percent of the employees in the affected unit.
- The plan describes the manner in which the participating employer treats the fringe benefits of each employee in the affected unit.
- The employer certifies that the implementation of a Shared Work Plan and the resulting reduction in work hours is in lieu of a temporary layoff affecting at least 10 percent of the employees in the affected unit and results in an equivalent reduction in work hours.
Shared Work is governed by Kansas Statute K.S.A 44-757 It says that to be eligible for participation in the program, an employer:
- Cannot have a negative balance in their unemployment tax account
- Must have established an experience rating
- Cannot be delinquent on unemployment tax reports or payments
Employee conditions for Shared Work Benefits:
- An individual must accept all work offered by the participating employer for the claim period filed.
- An individual is able to work and is available for full-time work with the participating employer.
- An individual is eligible for regular unemployment benefits in the state of Kansas.
- No benefits are paid to an individual who works for the participating employer more than the reduced hours specified in the plan.
- No benefits are paid to an individual whose work hours are reduced as a result of seasonal lack of work.
- If a participating employee is working for another employer, other than the Shared Work employer, and their combined hours of work for both employers are equal to or greater than the usual hours of work with you, they will not be eligible for Shared Work benefits.
Information needed to complete Shared Work Plan Application
- Company name and Kansas Department of Labor employer serial number.
- Description of how fringe benefits will be affected by the plan.
- Consensus of a bargaining representative, if a union represents the employees.
- Certification that:
- The plan applies to at least 10 percent of employees.
- The reduction is in lieu of temporary layoffs.
- Employees were notified that an identity verification will be conducted with the Social Security Administration.
- Employees were provided “Unemployment Insurance Notice.”
- An attached listing of employees showing:
- Full names
- Social Security numbers
How Participating Employers' Unemployment Tax Rates are affected:
Benefits paid under Shared Work Plans are charged against employers' accounts for use in computing (experience) tax rates. Thus, participation affects employers' unemployment tax rates in the same manner and to the same extent as other benefit charges.
For more information, contact us by mail at:
Kansas Department of Labor
Division of Employment Security, Benefits Branch
Topeka, KS 66603-3182
By phone at:
Printable PDF of information for Employers (K-BEN-P 050)
Printable PDF of information for Employees (K-BEN-P 052)