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To avoid layoffs, bill lets workers keep benefits when hours cut

Ohio businesses could temporarily reduce their employees’ hours while letting workers keep benefits and collect unemployment under a bill headed to Gov. John Kasich.

This week, the state Senate and House of Representatives approved a bill to create a SharedWork program in Ohio. The program would allow companies considering layoffs to instead reduce their employees’ hours.

SharedWork has support from both businesses and labor-aligned groups.

“Shared work is a proven layoff-aversion tool,” said Hannah Halbert, workforce researcher with Policy Matters Ohio, a liberal-leaning think-tank in a written statement. “It’s a smart step that will benefit Ohio workers and employers.”

Similar SharedWork programs have been created in 25 other states, including Michigan and Pennsylvania.

Initial start-up costs of the program — about $2 million in computer programming costs to allow the state to administer SharedWork and payments to workers whose hours are reduced, plus subsidies to unemployment premiums for employers that used SharedWork and marketing costs — would be funded by the federal government until 2015. After that, the program’s costs would be paid for out of the existing state unemployment compensation system.

SharedWork bill sponsor state Rep. Mike Duffey said he hopes the program will be off the ground within three to six months after Kasich signs it.

Duffey, a Republican from Worthington, said SharedWork will provide an alternative to layoffs for employers, allowing them to retain trained workers during lagging economic times.

The program is typically used most by manufacturers, but Duffey said military contractors near Wright-Patterson Air Force Base with lagging businesses due to defense budget cuts could take advantage of SharedWork, for instance.

“I think that SharedWork is going to make Ohio families stronger because it’s going to save jobs that would otherwise be lost that support spouses and children, it’s going to make employers stronger and it’s going to reduce the unemployment rate in Ohio,” Duffey said.

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