SACRAMENTO — AB 1731, a bill authored by Assemblymember Tasha Boerner Horvath (D-Encinitas) to incentivize businesses’ participation in the state’s Work Share Program, passed the Assembly on a bipartisan 74-0 concurrence vote.
Under California’s unemployment insurance Work Share Program, businesses are able to reduce employees’ hours and wages as an alternative to layoffs as eligible workers receive prorated unemployment benefits to replace lost wages. Businesses retain valuable, trained workers on staff and workers keep their jobs and their benefits. Despite the benefits of participating in the program, work-sharing has been widely underutilized because the application process can be slow forcing businesses to layoffs as they wait for their application to be approved.
“Business owners who want to keep their employees when times are tough should have access to an expedited process for starting a work-sharing plan and avoid unnecessary layoffs” said Assemblymember Boerner Horvath. “And, workers who have lost their jobs through no fault of their own will be more likely to accept a part-time job knowing that their unemployment benefits will not be significantly offset by their wages. Preserving the relationships between businesses and their workers are going to be critical to the quality and speed of our economic recovery.”
AB 1731 would create a temporary, simplified work-sharing application process requiring EDD to deem all program applications approved upon receipt and send employers their claim packets electronically within 5 days after the application is approved. To boost participation, the bill instructs the EDD to collaborate with the Governor’s Office of Business and Economic Development and the I-Bank on strategic methods to make sure employers are aware of the benefits of the program.
“Expediting Work Sharing applications and increasing outreach to employers, as this bill seeks to do, will help to overcome well-known hurdles of expanding the Work Sharing program,” said UCLA Economics Professor Till von Wachter, a supporter of the bill. “Acting now and decisively is important, since Work Sharing benefits are paid for by the federal government until December 2020.”
The federal CARES Act reimburses states for Work Share benefit payments and includes $100 million to cover implementation and administration costs. By expanding its program before the end of the year, California could take advantage of this funding and alleviate some of its own pandemic-related cost burdens.
AB 1731 is now headed to the Governor’s desk for his consideration.