A Powerful Tool to Help You Hold Your Employee Team Together

The Shared Work Program available through Arkansas Department of Workforce Services and the Department of Labor is a powerful tool to help you hold your employee team together. PLEASE give it a close look along with whatever HR resource you have to advise you.


The United States Department of Labor (DOL) issued guidelines Thursday on the unemployment insurance (UI) provisions in the CARES Act. To see the DOL guidelines, click https://www.arkansasstatechamber.com/wp-content/uploads/2020/04/DOL-UIPL_14-20.pdf.


Please take note of the Shared Work Program (SW). It is an opportunity to retain your employees and reduce payroll costs at the same time. The federal government will reimburse the state for all of the money paid out under the SW program, which will help protect the state’s UI Trust Fund that is fully funded by employers.


The SW program authorizes employers to reduce their employees hours/wages by 10% to 40%. The employees whose hours/wages have been reduced are eligible to receive unemployment compensation (UC) but the UC benefit will be reduced by the same percentage as their hours/wages. This program does not apply to employers that have laid-off employees. The SW employees will also be eligible to receive the $600 described below.


Here is a quick summary of the primary UI provisions in the CARES Act. Arkansas has previously signed an agreement with DOL to participate in these:


  • Pandemic UI Assistance (PUA) – Available January 27 thru December 31, 2020 – PUA provides up to 39 weeks of UC for those who are not normally eligible for UC such as independent contractors, self-employed, gig economy workers, etc.


  • Federal Pandemic Unemployment Compensation (FPUC) – Ends July 31, 2020 – FPUC provides an extra $600 to people who are drawing any type of UC.


  • Temporary Full Federal Funding of First Week of UC – This program eliminates the normal one-week waiting period to receive UC benefits.


  • Pandemic Emergency UC (PEUC) = Ends December 31, 2020 – PEUC provides up to 13 weeks of UC after a claimant has exhausted their state UC benefits.


  • Temporary Financing for Existing Short Term Compensation Programs – Ends December 31, 2020 – Authorizes use of states’ Shared Work programs for up to 26 weeks.


  • These programs are 100% federally funded, which helps the state and employers since employers pay 100% of the state’s UI program. The Arkansas UI Trust Fund had a balance of more than $850 million before the pandemic began. It is unlikely these funds will last the balance of 2020. States are allowed to borrow money from DOL once their UI Trust Funds run out of money. But the UI Trust Funds will need to be replenished and this money will come 100% from employers. So all of the CARES Act UI coverage extensions will not contribute to the decline of the Arkansas UI Trust Fund.


The CARES Act has other provisions to assist state UI administrators in hiring extra staff and providing flexibility in collecting taxes and charging employers’ accounts for the cost of UI claims.


Source: https://www.arkansasstatechamber.com/news-publications/news-releases/shared-work-program-through-dws-and-dol-a-powerful-tool/

©2020 by Central Arkansas Workforce Development Area.