Many have asked us about options for reducing salary and how unemployment works during this difficult time. We have prepared a document for Massachusetts employers that explains the difference between a furlough, layoff and reduction in force (RIF) along with a checklist that can be used during one of these events. All three of these options allow for an individual to collect unemployment.
Below is a brief summary about how unemployment works in Massachusetts, although this is subject to change as legislation is being passed:
• Unemployment Insurance (UI) benefits are calculated at 50% of a claimant’s average weekly earnings
• The weekly benefit amount cannot exceed the maximum allowed by law set at $823 per week
• If a claimant works part-time hours during weeks in which they request UI benefits, they may still be paid UI benefits if their gross wages are less than their weekly benefit amount
• Any wages above 1/3 of the weekly benefit amount (also known as their earnings disregard) are deducted dollar-for-dollar from the weekly benefit amount, which could result in a partial UI payment
There is also a program called WorkShare. According to the website, an employer needs to apply for WorkShare. With WorkShare, employees share reduced work hours while collecting Unemployment Insurance benefits to supplement their temporary lower wages. Eligibility requirements can be found here.
The information continues to evolve. Please don’t hesitate to reach out to us.
If you have questions about the impact of the coronavirus, please contact a member of your DGC client service team, or Dawn Hagman, SPHR, SHRM-SCP at 781-937-5345 / firstname.lastname@example.org for more information. You can also visit our coronavirus web page at dgccpa.com/coronavirus which will be continuously updated with new articles and checklists to help you deal with the impact of coronavirus on you and your business.