A state Senate committee voted Thursday to expand New Jersey’s job-sharing furlough law in a bid to leverage the extra unemployment benefits available through the federal CARES Act into potential savings for employers – in particular, state and local governments.

Sponsors of the bill say it could save employers hundreds of millions of dollars over the next three months and increase workers’ income by $1,000 to $6,000, with the biggest increases for those with the lowest salaries.

Employees would work two days a week instead of five. Their unemployment benefits for their partial furlough would amount to 24% of their salary, capped at $285 a week. The $600 a week available via the CARES Act through the end of July means many would actually get a raise while furloughed.

“This law already exists. We’re not breaking new ground here, for those who may have some trepidation," said Sen. Troy Singleton, D-Burlington. "This is permissive for the entities that choose to do it.”

The CARES Act also provides for 100% federal reimbursement of the cost of state unemployment benefits for any state that enacts a job-sharing furlough program under an existing state law. New Jersey adopted its law in 2011.

The New Jersey Education Association endorsed the bill, which can both temporarily increase the income of employees who make under $89,000 a year and provide school districts a little relief.

“I want to reiterate it’s really important to us that it be a decision between the union and the employer,” said Francine Pfeffer, the NJEA’s associate director of government relations. Such consent is required under the existing furlough law.

Sen. Nellie Pou, D-Passaic, said the furlough program would be particularly helpful for municipal and county governments. But Sen. Paul Sarlo, D-Bergen, said not all would participate.

“I don’t believe a lot of small communities and smaller towns will take advantage of this,” Sarlo said. “Hopefully counties and larger cities will take advantage of it.”

Among the changes made Thursday to the bill, S2350, was language limiting the unemployment qualification changes to the period of the coronavirus crisis when the federal government is paying for enhanced benefits and the removal of a provision that would have given workers employed by businesses with fewer than 30 employees the right to return to work after taking paid family leave.

With those changes, the New Jersey Business and Industry Association and New Jersey Chamber of Commerce endorsed the bill.

“We were worried about the family leave mandate within this bill for small businesses, and we were worried about the UI enhancements being permanent and maybe making the fund slower to recover,” said Chris Emigholz, NJBIA’s vice president for government affairs.

“Senate President Sweeney deserves credit for putting together a thoughtful plan to save some money,” Emigholz said. “And in this crisis, we need to look at savings. We need to figure out how we can, exactly as Chairman Sarlo said starting the committee, budget work’s going to be hard to balance. And ideas like this will help that.”

Lawmakers said they hope the Department of Labor and Workforce Development and its overwhelmed unemployment division get their planned improvements in place before any waves of public workers are furloughed.

“If this furlough program is to become law, we’re going to see an influx of people needing state resources through the UI program,” Singleton said. “And to hear today that there’s going to be more manpower put on these efforts and a greater ability to try and process these claims, which many of us on this call are being inundated with in our offices trying to help our fellow New Jerseyans, is a good thing.”

“I am hopeful and hearing from our commissioner today that if this is implemented, the Department of Labor is ready to handle the additional folks who will be filing for the unemployment,” Sarlo said.

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