# Plain Language Summary: Layoff Prevention Act of 2021

This bill extends and expands a program that helps companies avoid laying off workers during tough economic times. The program, called "short-time compensation," lets employers reduce workers' hours instead of firing them. When hours get cut, the government's unemployment insurance system tops up workers' paychecks so they don't lose too much income. It's basically a way to spread the pain of a downturn across many workers with reduced hours rather than having some workers lose their jobs entirely.

The bill makes three main changes to keep this program running longer and better funded. First, it extends the deadline for states that already have short-time compensation programs built into their unemployment systems—pushing it from March 2021 to about 5.5 years later. Second, it extends the deadline for temporary agreements states made to participate in the program, moving it from March 2021 to about 2 years and 3 months later. Third, it doubles the federal grant money available to help states run these programs, from $100 million to $200 million, and extends the deadline for using those grants from the end of 2023 to the end of 2026.

For workers, this means more job security during recessions or business downturns—you're more likely to keep your job with reduced hours and partial unemployment benefits rather than face a complete layoff. For employers, it provides a tool to keep experienced workers on staff without the full cost of their salaries during slow periods. The expanded funding and longer timelines suggest the bill's sponsors believed this program was valuable enough to invest in more heavily and maintain for years to come.

Layoff Prevention Act of 2021

DeLauro, Rosa L.

Layoff Prevention Act of 2021 This bill extends temporary funding to reimburse states for making short-time compensation (STC) payments under existing or new STC programs for weeks of unemployment ending on or before five years and six months after enactment of this bill. (STC, also known as work sharing, is a program that provides prorated unemployment compensation to workers whose hours have been reduced in lieu of a layoff.) Under current law, this reimbursement is available for weeks of unemployment ending on or before September 6, 2021. The bill also extends funding to support STC payments by states that do not have STC programs under state law through 2 years and 13 weeks after enactment of this bill. Under current law, this assistance applies to weeks of unemployment ending on or before September 6, 2021. Finally, the bill increases funding to the Department of Labor for awarding grants to states to (1) implement, or improve administration of, STC programs; or (2) promote, and enroll employers in, STC programs. In addition, the bill modifies the formula used to allocate such grants. Labor may not award a grant with respect to an application submitted after December 31, 2026. Such changes are retroactive to March 27, 2020.