MI Announces Plan To Address Coronavirus-Caused Deficit

MICHIGAN — The state is participating in a federal work share program to help address the state's budget deficit caused by its response to the coronavirus, the governor's office announced Wednesday.

As part of state's involvement in the federal Unemployment Insurance Agency Work Share program, impacted state employees will take two temporary layoff days per pay period beginning Sunday until July 25, resulting in up to $80 million in decreased wage costs.

“As we continue to combat COVID-19, it’s clear that we’re facing unprecedented challenges that will lead to serious budget implications for the state of Michigan,” Gov. Gretchen Whitmer said in a statement. “Utilizing this federal program keeps state employees working so they can continue to provide critical services to Michiganders and protects their paychecks so they can continue to support their families.”

This federal program allows the state to keep employees working with reduced hours, while employees collect partial unemployment benefits to make up a portion of the lost wages. State managers at the 17 level and above will not participate in the program but will take one layoff day every other pay period resulting in roughly a 5 percent reduction in gross pay. Over 31,000 state employees will be impacted.

Impacted employees will retain their health insurance and other benefits and will be automatically enrolled into the unemployment process to help ensure they have the support they need during this challenging time.

Last month, Whitmer announced she was taking a 10 percent pay cut and directed her executive team and cabinet appointees to take a 5 percent pay cut for the remainder of the fiscal year. Additionally, the governor's executive office will participate in the work share program.

Wednesday's layoffs do not impact anyone working on the front lines of the state's coronavirus response. Law enforcement, the prison system, veterans’ homes and other key health and human services all remain fully staffed with on-site employees, the governor's office said.