New Developments for Employee Furloughs in Massachusetts
This article was originally published on March 30, 2020 in The Legal Refresher.
Limited State Unemployment Benefits allowed in connection Furloughs due to COVID-19 Pandemic
New Massachusetts emergency regulations now allow limited eligibility for state unemployment benefits in connection with a furlough of employees if this employer action to furlough employees is the result of lack of work due to COVID 19/Coronavirus pandemic crisis.
Below is language from the new Massachusetts emergency regulations adopted in recent days.
Q. How do the Emergency Regulations make it easier for workers to get unemployment benefits?
Workers who are temporarily unemployed due to lack of work because of COVID 19 and expect to return to work will be eligible for unemployment benefits. They will be considered unemployed due to lack of work regardless of whether they are laid off, or furloughed, or if their workplace is fully or partially shut down temporarily. Under the Emergency Regulations, individuals in such situations are considered to be in “Standby Status.” Standby status is meant to help both employers and their employees in situations where the unemployment is expected to be temporary. Employers maintain contact with their workforce during the period of unemployment and have experienced employees ready to return when work becomes available again. Employees who find themselves in those situations due to COVID-19 will be approved for benefits more quickly, and will be relieved of traditional work search activities. In order to fulfill the requirements to be able, available and actively seeking work, individuals on standby status need only take reasonable measures to maintain contact with their employer, and to be available for hours offered by the employer.
https://www.mass.gov/info-details/employer-unemployment-faq-covid-19
Q. If I furlough all or part of my workforce, will they be able to collect unemployment?
A. If the furlough is because of COVID-19, employees are eligible for unemployment benefits. Workers who are temporarily unemployed due to lack of work because of COVID-19 and expect to return to work will be eligible for unemployment benefits. Under the Emergency Regulations, individuals in such situations are considered to be in “Standby Status.” Standby status is meant to help both employers and their employees in situations where the unemployment is expected to be temporary. Employers maintain contact with their workforce during the period of unemployment (in this case, a furlough) and have experienced employees ready to return when work becomes available again. Employees who find themselves in those situations due to COVID-19 will be approved for benefits more quickly, and will be relieved of traditional work search activities. In order to fulfill the requirements to be able, available and actively seeking work, individuals on standby status need only take reasonable measures to maintain contact with their employer, and to be available for hours offered by the employer.
[Cap on time for Unemployment Benefits for Furloughed Employees.]
Claimants in the situations described above will be presumed to be eligible for four weeks of standby status. For the four-week presumption, the employer need not even respond that the claimant is on standby. Employers may request, however, that the standby status be up to eight weeks, and, if necessary, DUA may extend standby status for longer that eight weeks.
Claimants in the situations described above (Furlough) will be presumed to be eligible for four weeks of standby status. For the four-week presumption, the employer need not even respond that the claimant is on standby. Employers may request, however, that the standby status be up to eight weeks, and, if necessary, DUA may extend standby status for longer that eight weeks.
https://www.mass.gov/info-details/employer-unemployment-faq-covid-19
Unemployment Benefits to Furloughed Employees in Illinois and other states
I have not seen anything yet definitive on Illinois but at least two sources seem to indicate that like now Mass. Illinois will allow unemployment benefit sot furloughed employees. Here is a recent new article from the leading paper in Chicago:
Q. What is the difference between being terminated or furloughed?
A. Furloughed employees are unpaid and don’t work, but they continue to be employed by the company and retain their health and other benefits. Termination means workers cease to be employed by the company and no longer receive benefits. You can claim unemployment insurance if you are furloughed or terminated.
Though this article only addresses Massachusetts and Illinois, the author believes that these same approaches, to allow at least limited collection of unempliymnent benefits by furloughed employees, would be taken in other states.
Update from prior CEO Refresher article
This new article in CEO Refresher is intended as an update to information provided in my earlier article in CEO Refresher that contrasted the availability of unemployment benefits in connection with a layoff vs with a furlough. https://www.refresher.com/layoff-furlough-or-other-employee-cut-backs/ The information in that earlier article of mine on the subject of availability of unemployment benefits to furloughed employees has been superseded by the new emergency regulations. When I became aware of those new regulations, I wanted to immediately share that updated information with readers of CEO Refresher.
Once again, this article is not legal advice but is intended to offer information on existing and new laws that the author hopes will be of some help to both employers and employees in these difficult times.
