In the example stated above, each employee would absorb an equivalent reduction in work hours and pay, while ensuring that there would be no layoff. It behooves the employees to keep their jobs and the company benefits because they retain qualified employees.
While many companies think that layoffs are the answer to their money problems, they do not realize how harshly it is affecting the economy. Workshare laws could help bring some law and order back into the workplace and hold employers responsible. Living in a right-to-work state, I know that employers are free to do as they wish.
Workshare laws would prevent a company from having to perform major layoffs because it could downsize across employees. Instead of having to get rid of twenty percent of their work force, the company could instead cut twenty percent of the work hours of all of a subset of employees. The cost reduction would be the same, but workers would not have to lose their jobs. It is a win-win situation because workers keep their jobs, and companies can cut their costs.
Having employees share jobs would definitely reduce layoffs, because costs for the company would decrease. Also, the employees would have a job, even though it's only part-time. In reality, the company would be paying for the salary of one employee, but there are actually two people doing the same job.
Alternative workshare laws would keep people working. Rather than laying people off, companies could in effect divide layoffs between several people or even the whole company. This is a good thing because it puts fewer people on the unemployment roll. But it also keeps a qualified workforce for companies. When times get better, they can reinstate workers back to their normal workload and salary without needing to retrain.
Europe already uses the alternative workshare laws during hard economic times. Keeping more people in the workforce, even if given reduced hours, is good for the economy because more people will have money to buy more things they need. Mass layoffs are just going to create more unemployment and the economy will suffer.
In Germany and in other areas, employers who are in financial distress have the option of decreasing all of their employees' hours by 10% and having the State Unemployment Insurance pick up the difference.
This has successfully prevented many layoffs.
We have long seen large companies lay off people at the expense of the communities which have given them their support. This lack of social responsibility has been justified for the sake of the almighty profit but frankly it is rather outragious and would not have been tolerated in earlier times when companies cared about their employees and viewed them as people rather than as commodities.
Workshare laws would give struggling companies a chance to maintain some profits while also doing the right thing by their employees who have been loyal to them, often providing many years of good service. I fully support this option.
I feel that having workshare available would definitely reduce the number of layoffs. People that share a job would be part time people therefore the company could save a lot of money by not needing to provide medical benefits. People that share a job would also require less sick/vacation time since they will already have more time off. The company could save money by not having to pay for these days. Saving money would decrease the amount of layoffs needed.
The way this question is phrased, I have to agree with the premise that workshare programs would prevent major layoffs. However, without a tax subsidy, it will ultimately harm a corporation's profitability. The reason for this is that eliminating a position saves more money than reallocating the work because having fewer employees means less overhead. Also, it may indirectly increase taxes since there will be a lot more people collecting "partial unemployment," which creates administrative costs that are passed onto the taxpayer.
Having employees share jobs would definitely reduce layoffs because costs for the company would decrease. Also, the employees would have a job even though, it's only part-time. In reality, the company would be paying for the salary of one employee but there are actually two people doing the same job.
Major layoffs are due to many complex reasons, and there is no one way to stop them. Furthermore, many major layoffs are due to the declining economy. Until something is done to improve the economy, major layoffs seem unavoidable. If companies are struggling to stay afloat, then major layoffs are sometimes the only option.
While layoffs are regrettable, they are a natural part of business. If a market cannot support a business, that business must change its model - and sometimes that requires layoffs. Interfering with that process would tie up precious resources (the men and woman working for the company) in a dying entity that in the end cannot support them.
Workshare laws put more stress on the unemployment system that already has trouble paying out money to those who are truly unemployed. The laws would give a struggling company the ability to force the taxpayers to foot the bill for their own incompetence, while the workers receive the benefit of unemployment, without having to actively look for work like a normal person receiving unemployment.
Companies should have the right to hire and fire whom they see fit, as long as they follow the law. I do not feel it is the business of government to force a company to give work to employees they might not feel comfortable giving that work to. If this is the case, then aren't we privatizing government in a way?
Health insurance can now reach 30% of an employee's paycheck and is matched by the employer. The Obamacare socialized medicine law increases the cost of health insurance and requires employers to pay even more for health insurance even for part time workers. The solution for businesses is not to decrease their labor costs with workshare and part time work but to decrease headcount and increase hours worked by all employees. Overtime pay for a few highly skilled employees is cheaper than the marginal cost of many low level employees.
Employers pay 15-30% of an employee's paycheck in unemployment insurance, Social Security and OASDI payments, depending on the state. These costs are flat no matter how many employees there are. However, administrative costs are comparable for each employee, whether part time or full time. Adding more part time employees raises the administrative costs for the business. This is a losing proposition.
Employers will hire contractors for their labor needs, not devise work share schedules with employees with benefit and administrative costs.