Don’t lay off your workers – Consider work sharing

Posted March 6, 2009

 

Work-Sharing Program


Facing difficult times?
When a company faces difficulty beyond its control and is forced to cut back production, it may have only two courses of action. It can either lay off employees temporarily or make an agreement with the affected employees to participate in a Work-Sharing arrangement.
 
What is a Work-Sharing Agreement?
Work-Sharing is an Employment Insurance (EI) program that enables employers to face cutbacks and still avoid layoffs. The program enables this by shortening the work week by one to three days and paying reduced wages accordingly. For the hours, days, or shifts not worked, Service Canada arranges for EI eligible employees to draw benefits, to help compensate them for the lower wages received from their employer.
 
Win-Win situation
Work-Sharing benefits employees:
  • they avoid the hardship of being laid off;
  • they retain their work skills.
Work-Sharing benefits employers:
  • valued employees are retained;
  • staff morale is strengthened;
  • expensive rehiring and retraining costs are avoided.
Working together
Management and employees must agree to participate in Work-Sharing. To be eligible, an employer must have been in business in Canada for at least two years. The company must also be able to show that the need for reduced hours is temporary and unavoidable, and is not a seasonal situation. Other conditions apply.
 
A temporary measure
Agreements can range from 6 to 26 weeks with an extension of up to a maximum of 38 weeks. However, the 2009 federal budget will extend, over the next two years, work-sharing agreements by 14 weeks, to a maximum of 52 weeks, and will increase access through greater flexibility in the qualifying criteria and streamlining processes for employers.
For more information:
The Service Canada web site provides more information about terms and conditions for the program as well as forms to be filled out: http://www1.servicecanada.gc.ca/eng/epb/sid/cia/grants/ws/desc_ws.shtml
To find the nearest Service Canada Centre: http://www1.servicecanada.gc.ca/eng/gateways/where_you_live/menu.shtml


 

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