The Department of Labor and Economic Opportunity has provided guidance to Michigan employers on ways to avoid potential layoffs related to COVID-19. Explore the options they propose below.

Work Share

If employers are financially distressed, but hope to continue operations by cutting back hours, they are encouraged to use the Unemployment Insurance Agency’s Work Share program. This program allows employers to maintain employment levels and business operations during declines in regular business activity rather than laying off workers.

Temporary Leave

At this time, employers are strongly urged to place employees on temporary leave and advise the worker they expect to have work available within 120 days as opposed to termination. This option provides no additional cost to employers, while allowing employees to remain eligible for unemployment insurance benefits through the state. Furthermore, employees may remain eligible for potential federal assistance.

Here are steps for employers to take when placing employees on temporary unpaid leave:

  • Do not terminate the employee.
  • Do not create a contractual obligation to bring the employee back to work.
  • Provide the employee with a formal Unemployment Compensation Notice.
  • Provide the employee with information on how to obtain unemployment insurance benefits.
  • Get each employee’s up-to-date contact information.
  • Let employees know if you will be putting updated information on the entity’s website or intranet, if applicable.
  • Communicate to the employee about their rights related to Governor Whitmer’s recent Executive Order.
  • Appoint a single, or limited number of individuals, who will field questions and communicate necessary information to the employee.

Under the governor’s order, an employer must not be charged for unemployment benefits if their employees become unemployed because of an executive order requiring them to close or limit operations.

Other State Resources

As the outbreak continues to worsen in Michigan, Governor Whitmer is seeking additional solutions for small businesses impacted by COVID-19, such as low-interest rate loans through the U.S. Small Business Administration.

Employers are encouraged to leverage the Michigan Economic Development Corporation or the Michigan Small Business Development Center for assistance in finding other available state programs to help.

As always, Doeren Mayhew is here for you and your business during these challenging times, please contact us for assistance in navigating the uncertainty.