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FAQs: Employers exploring Shared Work Program

Frequently asked questions by employers exploring the Shared Work Program.

How do I apply for a Shared Work Agreement?q1

See How Do I Get Started.

What are the employer's responsibilities once an agreement has been approved? q2

See Administer Your Agreement.

How long is a Shared Work Agreement in effect? q3

The duration of a Shared Work agreement must be at least 60 days, but not more than one year. You will indicate the length of time on your application.

How does a Shared Work agreement affect our unemployment tax rate? q4

Shared Work benefits are unemployment insurance benefits. Any benefits paid under your Shared Work Agreement will be charged to your employer account. Benefits paid and charged to your account, are part of the formula used to calculate tax rates. Since Shared Work is used in lieu of a full layoff, you should compare the benefits paid for full layoffs to those paid under Shared Work. One individual receiving 100 percent benefits roughly equals five individuals receiving 20 percent Shared Work benefits.

Why am I required to update the owner/officer information on my UI account prior to submitting my Shared Work Agreement? q4a

Any benefits paid under your Shared Work Agreement will be charged to your employer account, and will affect your tax rate. The owner or officer can be held personally liable for unpaid tax. Therefore, it is required, by law, that the Shared Work agreement be signed by an owner or officer that is listed on your UI employer account, and that the ownership information on your UI employer account be kept up-to-date.

We have a scheduled shutdown every year. How many weeks are we allowed to be shutdown while on a Shared Work Agreement? q5

Your proposed agreement can include a scheduled shutdown for up to two weeks.

Is it possible for an employer to have more than one agreement?q6

Yes; however, employees cannot be on more than one agreement at any time.

Who selects which employees participate?q7

You do. All employees listed on your Shared Work Agreement must have been hired at least one year prior to the date on your agreement and normally employed full-time. Under Shared Work, employees' hours are reduced with a corresponding reduction in pay to prevent layoffs. "Full-time hours" usually means 40 hours per week.

Can salaried employees, including owner/officers of the corporation, be included in the Shared Work Agreement?q8

Yes. Salaried employees, including owner/officers of the corporation, can be included as long as their hours are reduced with a corresponding reduction in pay. Owner/officers of the corporation must have elected optional UI coverage to be eligible.

How many employees must be included on a Shared Work Agreement?q9

By law, at least two employees must be listed on a Shared Work Agreement. This number varies based on the reduced number of hours indicated on your agreement. The total number of reduced hours has to equal at least 40 hours (one full-time position).

What is the required number of reduced hours?q10

The required reduction of hours must reflect the savings of at least one full-time position (40 hours). The reduction of hours you indicate on the agreement must be:

  • the same for each employee; and,
  • set at an amount that is at least 20 hours and no more than 32 hours per week for each.

Example: Reducing the hours of 5 employees from 40 hours per week to 32 hours per week, equals a 40 hour reduction, one full-time position.

Once a Shared Work agreement is approved, do the Shared Work employees have to work the reduced hours stated on the agreement each week?q11

No. You can change the number of employees working full-time or reduced hours each week to meet your business needs.

Example: You have ten employees in your plan:

  • week 1- all ten work full-time;
  • week 2 - seven have reduced hours while three work full-time;
  • week 3 - all ten have reduced hours.

If employee's hours vary from what is listed on the agreement, how are their weekly benefits affected?q12

Your employees' weekly benefits are based on the reduced number of hours you indicated on your Shared Work Agreement.

If an employee works:

  • fewer hours in a week than the hours listed on your agreement, no additional benefits will be paid.
  • more hours in a week than the hours listed on your agreement, no benefits will be paid.

Example: Your Shared Work agreement reduces the number of hours from 40 hours per week to 32 hours per week for 5 employees. One week, four of the five employees work 20 hours, while the fifth employee worked 33 hours. The four who worked 20 hours will receive the same amount of benefits paid to them when they work 32 hours. The employee who worked 33 hours will not receive any benefits for the week.

Do employees have to use their accrued vacation and/or sick time before they are eligible for Shared Work benefits?q13

No. The way that leave time is used depends on your company policy and/or labor agreement(s).

If a full layoff occurs, how are an employee's unemployment benefits affected by prior payment of Shared Work benefits?q14

Upon full layoff the employee becomes eligible for their full weekly unemployment benefit amount. Their maximum benefit amount will be reduced by the amount of Shared Work benefits they received. Employers must report any layoff by noon on the Friday before the layoff, in order for affected employees to receive their full weekly benefit amount instead of the reduced Shared Work benefit amount.

Some of my employees have a second job. How does this affect Shared Work benefits?q15

If the combination of hours worked for all employers in any week is more than 32, no benefits will be paid.

How will participation in Shared Work affect an employee's take home pay?q16

Participating employees will receive wages from their employer for the hours they work and benefits from the Unemployment Insurance Program for their lost time . The benefits make up about one-half of an employee's lost income due to reduced hours.

How will existing employee health care and pension benefits be affected by participating in Shared Work?q17

Employees participating in Shared Work will continue to be eligible for health care benefits and pension plans to the same extent as employees who are not participating in Shared Work.

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