Tennessee has enacted legislation (Senate Bill 958) that allows employers to create a voluntary shared work program. Senate Bill 958 took effect on May 27, 2022.
The Details:
Tennessee has established a shared work program that allows employers to reduce and evenly redistribute work hours among a group of employees to avoid layoffs.
Shared Work Plan Requirements:
To participate in the shared work program, an employer must submit a written plan to the state administrator. To be approved, the plan must:
- Provide an estimate of how many layoffs would occur without the program;
- Certify that the total reduction in work hours would have impacted at least 10% of the employees in the affected group;
- Apply to at least 10% of the employees in the affected group;
- Ensure that the affected group of employees was not reduced by temporary layoffs of over 10% of the workers in the past four months;
- Reduce the usual weekly hours for affected employees by at least 10% and up to 40%;
- Continue health, retirement, and fringe benefits for the affected employees as though their work was not reduced; and
- Not act as a subsidy for part-time, intermittent, or seasonal employees.
Employee Eligibility and Benefits:
An employee is eligible for shared work benefits if they are a member of an affected group and able and available to work during the normal work week.
Eligible employees are entitled to replace a portion of their lost wages by collecting a portion of their unemployment benefits (their regular weekly unemployment benefit multiplied by the percentage of the reduction in their usual weekly working hours) for up to 25 weeks.
Note: Under the law, additional rules exist if an employee works for a shared work employer and another employer.
Next Steps:
Tennessee employers should consult legal counsel to discuss the impact of Senate Bill 958 on their staffing policies and practices.