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Economy

State officials offer guidance to employers about how to avoid COVID-19 related layoffs

two construction workers
Elvert Barnes
/
Flickr / http://michrad.io/1LXrdJM

The state Department of Labor and Economic Opportunity is asking Michigan employers to consider alternatives to layoffs in the face of the COVID-19 pandemic.  

The department is urging employers who are contemplating reducing their workforce to place their workers on temporary leave instead of laying them off.

It is encouraging employers to advise the worker that the employer expects to have work available within 120 days. The reason for the department's recommendation is that it says temporary leave, as opposed to layoffs, may let employees stay eligible for potential federal assistance that is still up in the air pending Congressional action.

According to the department, there is no additional cost to employers for temporary leave compared to termination, and employees will remain eligible for state unemployment insurance benefits.

The department also suggests that employers look to the Unemployment Insurance Agency's Work Share program if they are financially distressed but hope to continue operating by cutting back hours. The program lets the employer retain employees with reduced hours while employees collect partial unemployment benefits to make up some of the lost pay. 

According to the department, the state is monitoring issues related to continued medical insurance coverage and will provide updates.

 

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