Labor Dept. Attempts to Stop Layoffs by Giving $100 Million to States to Subsidize Payrolls

By Penny Starr | August 15, 2012 | 5:12pm EDT

Labor Secretary Hilda L. Solis (CNSNews.com/Penny Starr)

(CNSNews.com) – The Labor Department announced on Monday that it will be awarding almost $100 million in grant funding to states to prevent layoffs by allowing businesses to pay employees as part-time workers and the federal government will pick up the tab for the cost of a full-time paycheck.

The “work-sharing” program was passed as part of a Republican-led bill in the House, H.R. 3630, and Senate Amendment 1465 to extend the payroll tax deduction and unemployment benefits. In February 2012, President Barack Obama signed the bill into law, which included the $100 million in funding.

"Establishing or expanding work-sharing programs nationwide will help business owners better weather hard economic times by temporarily reducing their labor costs while still keeping their existing skilled employees," Labor Secretary Hilda L. Solis said in the press release announcing the grants. "This program is a win-win for businesses and employees alike."

The work-sharing programs “allows employees to keep their jobs and helps employers to avoid laying off their trained workforces during economic downturns by reducing the hours of work for an entire group of affected workers,” according to the Labor Department.

The grants will be given to states that apply and meet certain requirements, including having short-term compensation programs in place that meet federal guidelines. Workers will have “wages compensated with a portion of their weekly unemployment compensation payments,” according to the Labor Department.

The Labor Department also released a chart detailing the funding available for all 50 states, U.S territories and the District of Columbia.

The largest pot is available to California, with $11,593,587 in grant funding listed. New York and Florida can get around $6 million, with Illinois and Pennsylvania eligible for more than $4 million each.

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