Moriarty Bill to Help Businesses & Workers Avoid Layoffs Advanced by Assembly Committee

(Trenton) - Legislation sponsored by Assemblyman Paul Moriarty to help both New Jersey businesses and workers avoid layoffs was released Monday by an Assembly panel.

The bill (A-3818) is designed to encourage employers who must reduce their employees' work hours because of economic conditions to avoid layoffs by sharing the remaining work.

That would be achieved by permitting, under certain circumstances, a full-time employee to receive unemployment benefits when the employee's weekly work time is reduced by 10 percent or more.  The bill also permits the employee to attend an approved training program while receiving those benefits.

"This is a creative and unique approach to helping New Jerseyans stay on the job," said Moriarty (D-Gloucester/Camden).  "Anything we can do to avoid layoffs is a good thing, and this is a way for both workers and businesses to benefit while keeping people off full-time unemployment.  This is the sensible and decent thing to do for hard-working New Jerseyans and the businesses that employ them."

The bill provides that an employer of at least 10 full-time non-seasonal employees may provide a shared work program if approved by the Department of Labor and Workforce Development.

The program may be approved for one year with annual renewals up request.

"Job creation and economic development needs to be our priority," Moriarty said.  "We can approach that goal in many ways, and this is a new way to keep people employed and give them the financial security while providing stability to businesses working their way through this difficult economy."

The employer is required to sustain existing fringe benefits levels, not to hire additional part-time or full-time employees or make unreasonable revisions of workloads; to provide information needed to monitor compliance and to certify that if a labor union represents the employees, it has agreed to the terms of the program.

Under an approved program, an employee is eligible for "short-term" unemployment benefits if:

• The employee's weekly work hours are reduced at least 10 percent of normal full-time hours;
• The employee would be eligible for regular unemployment benefits during the week if the employee was entirely unemployed; and
• The employee is available to work normal full-time hours.

Short-time weekly benefits paid to an eligible individual would be equal to the individual's weekly benefit rate multiplied by the percentage of reduction of his wages for the week.

The benefits are limited to 26 weeks during a benefit year, but the weeks may be nonconsecutive.  No person may receive both short-term benefits and regular unemployment benefits during the same week.  The combined total of regular and short-term unemployment benefits for an employee during a benefit year is limited to the maximum amount of regular unemployment benefits allowed.

All short-time benefits are charged to the account of the employer that provides the shared work program.  The bill requires the Commissioner of Labor and Workforce Development, three years after the effective date of this bill, to submit a report to the Legislature assessing the implementation of the bill's provisions and their impact on the State Unemployment Compensation Fund, evaluating the effectiveness of shared work programs approved by the division and making any recommendations for appropriate legislative or administrative action necessary to further the purposes of this bill.