Reed Introduces Layoff Protection Measures on the Senate Floor
Mr. President, today I am joined by several of my colleagues in introducing the Layoff Prevention Extension Act and the Preventing Layoffs During a Public Health Emergency Act.
Both bills would renew Federal support for State short-time compensation—or work sharing—programs and provide assistance for States to adopt and improve existing programs in law. The latter bill would specifically activate financing for work sharing programs when there is a public health emergency. The coronavirus has officially reached a pandemic level, with an increasing impact on individual lives, communities, and businesses across the United States.
Last week, I was pleased that the Senate voted on an overwhelming bipartisan basis to approve nearly $8 billion in supplemental funding for public health agencies to respond to this outbreak, but that was only the down payment. While Congress has taken initial steps to address coronavirus as a public health crisis and stop the spread of COVID–19, it is also important to support the workers, students, families, and businesses that are already being impacted as this outbreak ripples across the economy.
In response to a reduced workforce due to workers that are ill, quarantined, or have new caregiving duties, companies that are losing business may need to lay off workers—even those that are healthy, if they are unable to keep their doors open. We need to extend emergency UI benefits, but just as importantly, we should incentivize employers to not lay off workers for what we hope will be a temporary public health emergency. That is where work sharing can play a critical role, as it encourages, through the UI system, employers and employees to voluntarily reduce hours instead of laying people off.
The concept of work sharing is simple—it provides an alternative to help businesses that are experiencing a temporary slowdown the chance to retain employees on a less than full-time basis. By giving struggling companies the flexibility to reduce hours instead of their workforce, work sharing programs prevent layoffs and help employers save money on rehiring costs. All the while, workers who otherwise would be in danger of losing their jobs completely—would keep their jobs instead, with the UI system making up for lost wages. According to the Department of Labor, work sharing saved approximately 570,000 jobs in the wake of the Great Recession (2008–2015). As part of the Middle Class Tax Relief and Job Creation Act, Congress enacted my Layoff Prevention Act of 2012, which provided temporary Federal financing for 100 percent of work sharing benefits paid to workers. States also received -1/ grants for implementation, improved administration, and program enrollment efforts. This assistance helped save over 130,000 jobs from 2012 to its sunset in 2015.
Multiple studies have found that communities that adopted more robust work-sharing programs weathered the recession with lower unemployment rates. But even more jobs could have been saved if these programs had been in place before business slowed down. The legislation I am introducing today would address the current public health emergency and help soften the blow of future slowdowns.
The Preventing Layoffs During a Public Health Emergency Act would provide financing to States with and without formal work sharing laws during the period of a public health emergency, and up to one year after the termination of the emergency. The Layoff Prevention Act would provide a more permanent solution to give States an incentive to expand their work sharing programs to prevent future layoffs and blunt economic downturns.
I urge my colleagues to join me and Senators WHhitehouse and Sanders in supporting passage of both bills to keep American workers on the job, save taxpayers money, and provide employers with a practical, positive, and cost-effective alternative to layoffs.