More state businesses using Shared-Work Program

In February, Sterling Ramberg faced the prospect of laying off a fifth of the employees at The Gear Works, a manufacturing company in South Park founded by his father.

Then he found a way around it. Through a vendor he heard about a government program that would allow his employees to work part-time yet still collect partial unemployment benefits.

The federal-state Shared-Work Program, now available in 17 states, is another way to distribute unemployment benefits. In Washington, it's operated by the Employment Security Department.

Though it's been in place since 1983, it hasn't been widely known. But this year, in the depths of the recession, more than 2,100 businesses in the state have signed up — a whopping increase from 145 employers just a year ago.

Indeed, Washington state is No. 2 in the country, after California, in terms of number of businesses and employees — now 42,000 — using the program.

"It's a simple concept," said Employment Security Commissioner Karen Lee during a news conference Wednesday.

The conference was part of the department's effort to get the word out about the program. It's also talking to individual businesses and to chambers of commerce.

For struggling companies needing to reduce their payroll, the Shared-Work Program allows them to temporarily cut their employees' hours by 10 to 50 percent. The employees, in turn, can make up a portion of their lost wages and still keep whatever company-provided benefits they had before.

Both public- and private-sector employers of all sizes are eligible to apply and may participate for up to 52 weeks.

To qualify, employees must be eligible for regular unemployment benefits and must be full-time hourly — not salaried — workers. They don't have to actively look for work as do workers receiving full unemployment benefits.

The program is also flexible, allowing individual employees to work full-time one week and part-time the next, depending on the employer's needs.

At Gear Works, a 63-year-old company in Seattle's South Park neighborhood, business has been down about 25 percent from last year, and in February, the company laid off eight people.

In March, it signed up for Shared-Work and avoided having to lay off 13 others, said Mike Robison, plant superintendent.

At one point, two-thirds of Gear Works' 95 hourly employees were working reduced hours and drawing the partial unemployment benefits. Now, with business slowly picking up again, about half are.

"It worked out great for my situation," said Mike Bowman, 30, a gear machinist apprentice who's working about 32 hours a week.

If he had been laid off, it wouldn't have been easy to find a job and support his wife — who's on pregnancy leave — and their 3-year-old son.

It's a temporary measure that will hopefully help "us and our employees weather this storm," said Gear Works owner Ramberg.

Shared-Work is a part of the country's federal-state unemployment-insurance program and, like regular unemployment insurance, is funded through taxes paid by employers. Typically, employers pay less for Shared-Work participants than for fully laid off employees.

Each state decides whether to offer a Shared-Work program. In the past in Washington, about 90 percent of participants were manufacturers.

But since the recession began, about 70 percent have been manufacturers with the rest coming from the wholesale trade, construction, retail and professional, scientific and technical services industries.