Lamont expands program to help businesses keep workers

In an attempt to boost a state economy and job market struggling in the coronavirus pandemic, Gov. Ned Lamont wants to expand a program that has historically allowed manufacturers flexibility on paying for full-time workers.

Under the program, which started in the Great Recession, the state Department of Labor uses federal funding to allow businesses to keep employees on the payroll, but with curtailed hours — letting them collect unemployment benefits for days they don’t work.

That would expand to employers in the restaurant, hotels and theaters industries, Lamont said Wednesday n the floor of a Middletown aerospace contracting company. Lamont also plugged the program for the factory sector.

The state’s Shared Work program will broaden its scope during the week of October 5, allowing, Lamont envisions, “tens of thousands” of companies to avoid layoffs, letting them cut hours temporarily, and utilize the unemployment system to retain worker wages.

Speaking at the Pegasus Manufacturing Corp., which is using the program to keep skilled workers on staff even when there isn’t enough work, Lamont said by letting the other industries sign up for the state Department of Labor program, workers and employers can both benefit.

With lingering uncertainty over coronavirus and its effects on the state economy, expanding the program can be a lifeline in the recovery, said Lamont, who called the Shared Work program “underutilized.”

“I don’t know if we’re in the fourth quarter of COVID, or the fourth quarter of the COVID economy or not, but we’re definitely going through a transition,” Lamont said. “When it comes to the pandemic, this is a really key few months. It’s also a pivot point for the Connecticut economy.”

He said that while about 95 percent of the state economy has reopened, only 85 percent of jobs lost in the spring are back, and some service-sector industries are still struggling, such as restaurants, hotels and movie theaters. Employers are up in the air, as even those that have been allowed to reopen haven’t rebounded because of consumer hesitancy.

“The service sector has been hit so hard,” Lamont said. “We’re going into colder weather. Maybe a lot of restaurant owners are sort of saying, ‘Look, outdoor dining worked pretty well in August and September. I’m not so sure how it’s going to be in October, not to mention November.’ Now you don’t lay off that person.”

He offered a hypothetical in which a restaurateur keeps staffers on for three days a week, with the state paying for their two other days.

“Maybe they can’t afford to keep them five days a week,” Lamont said. “As the economy slowly ramps up, we’ve got the people ready to transition. It saves you, the taxpayers, a significant amount of money. It gives them, the employers, an incentive to keep people employed, keep people trained, keep people working.”

Lamont and the Department of Labor have budgeted about $1 million in federal pandemic-relief money to fund initial phases of the new program, including an upgrade of computer technology in the agency. Currently, 1,340 companies have been admitted into the program since March, in which 10 percent to 60 percent of employee wages have been provided.

Deputy Labor Commissioner Daryle Dudzinski said that over the last six months, 24,300 workers have been assisted by the program, allowing them to keep their jobs and company health and retirement benefits for maximum of six months during the pandemic. Dudzinski said that in the prior year, 2,900 workers in 288 companies were assisted.

Matthew Brown / Hearst Connecticut Media Restaurant owners who want to retain employees as they try to recover in the pandemic would be able to obtain federal unemployment funds through the state Department of Labor, under an expansion of a program announced Wednesday.