Work Sharing Program

Updated June 26, 2014: Changes to Work Sharing Plans Effective On or After July 6, 2014

California Assembly Bill 1392 amends Section 1279.5 of the California Unemployment Insurance Code regarding Work Sharing program requirements. Work Sharing plans effective on or after July 6, 2014, must meet the additional requirements. Work Sharing plans effective on or prior to July 5, 2014, will continue under the law as it existed prior to the amendment of Section 1279.5.

The Work Sharing Unemployment Insurance program allows for the payment of benefits to employees whose hours and wages have been reduced. This program was established by the California legislature to help employers avoid some of the burdens that accompany a layoff situation and is considered an alternative to layoffs. Any employer who has a reduction of production, services, or other conditions that cause the employer to seek an alternative to layoffs can consider participating in the Work Sharing program.

Advantages of Work Sharing

  • Allows employers to retain trained employees until business conditions improve.
  • Enables employers to avoid the expense of recruiting, hiring, and training new employees.
  • Minimizes or eliminates the need for layoffs and accompanying hardships for employees.
  • Can be used to prevent layoffs in almost all types of business or industry.

Work Sharing Requirements

Employers must meet all program requirements to be approved by the Employment Development Department (EDD) to participate in the Work Sharing program.

WORK SHARING PROGRAM REQUIREMENTS
For Plans Effective On or After July 6, 2014 For Plans Effective On or Prior to July 5, 2014
Employers must be a legally registered business in California and have an active California State Employer Account Number. Employers must be a legally registered business in California and have an active California State Employer Account Number.
At least 10 percent of the employer’s regular workforce or a unit of the workforce, and a minimum of two employees, must be affected by a reduction in hours and wages. At least 10 percent of the employer’s regular workforce or a unit of the workforce, and a minimum of two employees, must be affected by a reduction in hours and wages.
The employees’ reduction in hours and wages must be at least 10 percent and must not exceed 60 percent. The employees’ reduction in hours and wages must be at least 10 percent and must not exceed 90 percent.
The health benefits of employees must be continued under the same terms and conditions as prior to the reduction in hours and wages or to the same extent as other employees not participating in Work Sharing. Unless a reduction is applied equally to employees not participating in Work Sharing, employers who reduce health benefits of employees participating in Work Sharing will not qualify for the Work Sharing program. Changes in health benefits do not apply.
The retirement benefits of employees must be continued under the same terms and conditions as prior to the reduction in hours and wages or to the same extent as other employees not participating in Work Sharing. Unless a reduction is applied equally to employees not participating in Work Sharing, employers who reduce retirement benefits of employees participating in Work Sharing will not qualify for the Work Sharing program. Changes in retirement benefits do not apply.
The collective bargaining agent of employees in the bargaining unit must agree to voluntarily participate in Work Sharing and must sign the application for Work Sharing. The collective bargaining agent of employees in the bargaining unit must agree to voluntarily participate in Work Sharing and must sign the application for Work Sharing.
Employers must identify the affected work unit(s) to be covered by the Work Sharing plan and identify each participating employee by their full name and Social Security number. Employers must identify the affect work unit(s) to be covered by the Work Sharing plan, but do not need to identify participating employees by their full names and Social Security numbers.
Employers must notify employees in advance of the intent to participate in Work Sharing. Employers are not required to notify employees in advance of the intent to participate in Work Sharing.
Employers must identify how many layoffs will be avoided by participating in the Work Sharing. Employers are not required to identify how many layoffs will be avoided by participating in the Work Sharing.
Employers must provide the EDD with any necessary reports or documents relating to the proper conduct of the Work Sharing plan. The EDD will not request reports or documents relating to the proper conduct of the Work Sharing plan.

Work Sharing Restrictions

  • Leased, intermittent, seasonal, or temporary service employees may not participate in the Work Sharing program.
  • Corporate officers or major stock holders with investment in the company may not participate in the Work Sharing program.
  • New! The Work Sharing program cannot be used to as a transition to a layoff.

Work Sharing Plan Application

To participate in the Work Sharing program, employers must apply for a Work Sharing plan by completing and mailing a Work Sharing (WS) Unemployment Insurance Plan Application (DE 8686) to the EDD Special Claims Office. All Work Sharing plans begin on a Sunday. The earliest effective date for a new Work Sharing plan is the Sunday prior to the first contact date with the EDD.

  • New! For plans effective on or after July 6, 2014, the length of an approved plan is one year.
  • For plans effective on or before July 5, 2014, the length of the approved plan is six months.

The plan expiration date is listed on the notice of approval that is mailed to employers after their Work Sharing plan is approved. Employers may renew a Work Sharing plan, if needed, by completing the Work Sharing (WS) Unemployment Insurance Plan Application (DE 8686). The effective date of a renewed Work Sharing Plan is the day after the prior plan expires, only if the plan application is submitted no more than 10 days after the prior plan has expired. Otherwise, the plan effective date will be the Sunday prior to the date in which the application is received.

Contact Work Sharing

Employers: If you are an employer and need additional information on Work Sharing, contact the EDD Special Claims Office at 916-464-3343.

Employees: If you are an employee approved by your employer to participate in Work Sharing and have questions regarding your Work Sharing claim, contact the EDD Special Claims office at 916-464-3300.

Additional Resources

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