Fillable Printable Work Sharing Unemployment Insurance Program (De 8714Bb)
Fillable Printable Work Sharing Unemployment Insurance Program (De 8714Bb)
Work Sharing Unemployment Insurance Program (De 8714Bb)
WORK SHARING UNEMPLOYMENT INSURANCE PROGRAM
This California program allows for the payment of Work
Sharing Unemployment Insurance benefits to individuals
whose wages and hours have been reduced. The program
is considered a temporary and practical alternative to
layoffs. For example:
• Due to an economic downturn, an employer with 100
employees finds it necessary to lay off 20 employees.
However, rather than lay off these employees, the
employer participates in the Work Sharing program.
The employer keeps all 100 employees on the payroll
but reduces their workweek from five days to four days,
thereby achieving the same desired 20 percent reduction
in payroll. All 100 employees continue to earn wages for
four days and also are eligible for Work Sharing benefits for
the fifth (nonworking) day. The employer retains all trained
staff and, when business improves, the employees resume
their five-day work schedule.
Background
California’s Work Sharing program was the first program of
its kind in the nation. It was established by the California
State Legislature in 1978 under Senate Bill 1471. The
objective of the Work Sharing program is to help employers
and employees avoid some of the burdens that accompany
a layoff situation. If employees are retained during a
temporary slowdown, employers can quickly gear up when
business conditions improve. Employers are spared the
expense of recruiting, hiring, and training new employees.
Employees are spared the hardship of total unemployment.
Who May Participate in Work Sharing?
Any employer who has a reduction in production, services,
or other conditions that cause the employer to seek an
alternative to layoffs may participate in the Work Sharing
program. Some of the specific requirements are:
• A minimum of two employees, comprising at least
10 percent of the employer’s regular workforce or a unit
of the workforce, must be affected by a reduction in
wages and hours worked.
• The reduction in weekly wages and hours worked also
must be at least 10 percent, not to exceed 60 percent.
• The company will maintain employees’ health and
retirement benefits under the same terms and conditions
as prior to the reduction in hours and wages or to the
same extent as other employees not participating in the
plan.
• A corporate officer or major stocker holder who is
deemed to have significant investment in the company
may not participate in the Work Sharing Program.
How Does an Employer Participate in Work
Sharing?
To participate in this program, employers may call or write:
EDD Special Claims Office
PO Box 419076
Rancho Cordova, CA 95741-9076
916-464-3343
The Special Claims Office will mail interested employers a
Work Sharing Plan Application, DE 8686 and other general
information, or the employer may download the Work
Sharing Plan Application, DE 8686 from the Internet at
www.edd.ca.gov/pdf_pub_ctr/de8686.pdf.
What Happens After the Employer’s Work
Sharing Plan Application is Approved?
The Special Claims Office in Sacramento sends the
employer a letter of approval, one mail claim packet for
each participating employee, and a ten-week supply of
weekly certification forms for each employee. During the
weeks of reduced hours and wages, the employer issues
the certification forms to the participating employees.
All Work Sharing claims are filed by mail. The employer
and participating employee complete the documents
contained in the mail claim packet. After completion,
the documents are mailed to the Special Claims Office to
establish an Unemployment Insurance claim. Employees
approved to participate in the program must meet regular
Unemployment Insurance claim filing requirements. After
the Unemployment Insurance claim is filed, the employer
issues a certification form to each participating employee.
DE 8714BB Rev. 21 (7-15) (INTERNET) Page 1 of 2
CU
P.O. Box 826880 • Sacramento CA 94280-0001
Benefits are paid weekly proportionate to the percentage
of reduction in hours and wages. For example:
• An employee normally works a five-day workweek and
is paid $500. If this employee’s workweek is reduced to
four days, the employee’s weekly wages would be $400.
This is a 20 percent reduction in wages and hours. The
Work Sharing benefits for this employee are 20 percent
of the Unemployment Insurance benefits the employee
would receive if the employee were totally unemployed.
If the employee’s weekly Unemployment Insurance benefit
amount is $300, the employee would qualify for $60 in
Work Sharing benefits. This results in a reduction in gross
wages of only $40 for that week ($400 + $60 = $460).
How is the Employer Charged?
Employers are charged for Work Sharing Unemployment
Insurance benefits in the same manner as for regular
Unemployment Insurance benefits. Questions regarding
employer charges may be directed to:
EDD Contribution Rate Group
916-653-7795
The Advantages of Work Sharing
The Work Sharing program can meet employers’ needs due
to its built-in flexibility and possible variations by:
• Minimizing or eliminating the need for layoffs and the
accompanying hardships for employees.
• Enabling a business to retain trained employees and
avoid the expense of recruiting, hiring, and training new
employees.
• Retaining employees during a temporary slowdown
allowing employers to quickly gear-up when business
conditions improve.
• Treating employees more equitably than layoffs, which
place the burden of economic adjustments for an entire
business on relatively few employees.
• Allowing almost all types of business or industry.
For More Information
For further information, please contact:
EDD Special Claims Office
PO Box 419076
Rancho Cordova, CA 95741-9076
916-464-3343
For additional information on other EDD programs and
services, please visit EDD’s Internet site at www.edd.ca.gov.
The EDD is an equal opportunity employer/program.
Auxiliary aids and services are available upon request to individuals with disabilities.
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