More UI Math: An Oregon Workshare Participant with a 40% Reduction in Hours, and Up to $72,700 Annual Wages Could Replace 100% or More of Income with a $300 UI Supplement.

In my recent post HERE I highlighted the impact that a possible $300 unemployment insurance supplement would have for a full time laid off Oregon worker. 

This post focuses on the impact that the same $300 supplement would have on Oregon employees who are participating in an approved Workshare program. 

Workshare calculations reduce the average weekly unemployment insurance benefit amount by the same percentage as the hourly reduction (within an allowable 20% to 40% range) while still allowing the employee to retain the full reduced wage.  

This is different than the partial employment UI program (AKA "Working While Claiming) that provides NO unemployment insurance benefits if  the amount of reduced earnings would be the same or more than than the amount of the weekly benefit amount.  

Generally speaking Workshare allows higher income wage earners to retain a higher share of their combined unemployment insurance benefits and reduced wages than the partial employment program will allow. 

The table below illustrates that a Workshare employee could earn up to $72,700 annually and even with a 40% reduction in hours (to 24 hours) retain 100% of their $1,398 weekly income with a combination of reduced wages, regular unemployment insurance, and a $300 unemployment insurance supplement.  

Further, at incomes below $72,700 with the same 40% cut in hours, the percentage of income replaced would exceed 100%. 

Using the same $44,700 annual income I used in my prior post for a full time laid off worker the worker with a 40% reduction in hours, regular unemployment insurance and a $300 UI supplement would have total weekly income of $1,037 which would replace 121% of their full time weekly salary of $857. 

NOTES: 

1. Current discussions are centered around extending CARES Act unemployment programs and funding for a 16 week period. Using the 40% work hour reduction in this example at the $72,700 wage level replacement income would drop to $1,098--79% of full time wages once the $300 UI supplement goes away. 
2. Employers elect to permit their employees to participate in workshare. 
3. IF a Workshare extension is included in any CARES act extension it is possible that benefits will continue to be 100% paid for by the federal government. Previously public agencies used workshare as a way of dealing with reduced budgets and increased participation could happen again with a $300 UI supplement that is 100% federally funded. Private employers could also increase Workshare participation as benefit costs would not impact their experience ratings used to calculate their UI tax rates.  

Originally created and posted on the Oregon Housing Blog.