If your employees are working reduced hours or are temporarily unemployed until your practice reopens, they're still entitled to file for partial unemployment benefits. You may also consider participating in a work share program to retain employees while reducing costs.
California offers both partial unemployment benefits and work sharing, important tools for protecting your business and its employees during office closure amid the COVID-19 crisis.
Employees filing for partial unemployment benefits aren't required to look for jobs because they're still considered employed. Due to the COVID-19 crisis, state and federal governments have waived the job-search requirement for all categories of the unemployed.
Employees would qualify to file for partial benefits if wages in one week were reduced by $25 or 25 percent (whichever is more), enabling them to receive a check for the difference. State unemployment benefits range from $40-$450 per week.
Employees filing for partial benefits must also still meet the eligibility criteria of a base period earnings requirement, be totally or partially unemployed, unemployed through no fault of their own, physically able to work, available for work, and ready and willing to accept work immediately.
Previously, some employers may have participated in the state Employment Development Department's (EDD) partial unemployment program to cover periods when less work was available to employees. Due to the COVID-19 crisis, however, the EDD is asking those employers in that program to no longer issue Notice of Reduced Earnings forms to employees furloughed or working reduced hours. Instead, employees should apply for benefits online and certify for continued benefits every two weeks online after their initial claims are processed.
Due to the pandemic, the state has also waived the seven-day waiting period to receive benefits. With nearly 3 million Californians filing unemployment claims since mid-March, the EDD has redeployed more than 1,000 state workers to staff its call center and help process claims.
Initial claims can be filed via UI Online during extended hours, however those who have questions or had claims denied must speak to a representative on the phone. Call center hours have been extended to 8 a.m. to 8 p.m. seven days a week to handle the increased call volume.
Beginning April 4, the state EDD also began processing the additional $600 in unemployment benefits provided under the federal CARES Act. The CARES Act also extends unemployment benefits by an additional 13 weeks.
California practice owners can also apply for the Unemployment Insurance Work Sharing Program as an alternative to layoffs. The program cannot be used as a transition to layoffs and instead allows for employees to receive unemployment benefits, retain their current jobs, and avoid financial hardships. It also supports practice owners to minimize or eliminate the need for layoffs; retain highly trained employees which allows for a smooth transition when the practice is ready to see patients as normal again; and helps to avoid the costs of recruiting, hiring, and training new employees.
To participate, practice owners must file a work sharing plan with the EDD, be a legally registered business in California, and possess an active California State Employer Account Number. In addition, at least 10 percent of the team and, a minimum of two employees, must be affected by a reduction in hours and wages. The reduction of hours and wages must be by at least 10 percent but cannot exceed 60 percent.
Employees that are participating in the work sharing program must receive the same health and retirement benefits as they did before their wages and hours were reduced or meet the same standards as employees whose wages and hours have not been reduced.
Practice owners must notify employees in advance regarding the reduction of wages and hours as well as the intent to participate in the work sharing program. It’s also important to convey how many layoffs the plan will avoid.
After an initial term of one year, the work sharing program can be renewed. For information on the program, visit https://www.edd.ca.gov/unemployment/Work_Sharing_Program.htm.
For the latest on the EDD's COVID-19 response, visit https://www.edd.ca.gov/about_edd/coronavirus-2019.htm.
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Quick note: This is not to be taken as legal or HR advice. Since employment laws change over time and can vary by location and industry, consult a lawyer or HR expert for specific guidance. Learn about HR for Health's HR services