In this time of deepening economic troubles globally, and in the United States particularly, there are calls in the capitals around the world for economic stimulus and assistance. While new spending and new programming may come on line in the United States in the not too distant future, certain Trade Act programs fostered by the U.S. Department of Labor may provide an avenue for more immediate relief for employees affected by trade conditions, such as increased imports from, or shifts in production to, foreign countries that complicate the present economic downturn.
Overview of Trade Assistance Program
The Trade Act programs, Trade Adjustment Assistance (“TAA”) and Alternative Trade Adjustment Assistance (“ATAA”), assist individuals who have lost their jobs as a direct result of increased imports from, or shifts in production to, foreign countries. The goal of the Trade Act programs is to help trade-affected workers return to suitable employment as quickly as possible. To facilitate this goal, TAA-certified workers may access a menu of services that include income support, relocation allowances, job search allowances, and a health coverage tax credit. TAA participants that require retraining in order to obtain suitable employment may receive occupational training through the program. The ATAA program for older workers provides an alternative to the benefits offered under the regular TAA program.
To receive Trade Act program benefits, a petition must be filed by a group of three or more workers, by a company official, by a “One-Stop Career Center”* operator, by a partner (e.g., state employment security agencies and dislocated worker units), or by a union or other duly authorized representative of a group of workers. The workers on whose behalf a petition is filed must be, or must have been, employed by the company identified in the petition.
Applicants must meet the following criteria to be eligible for assistance:
- Their company, or former company, produces a product
- A required minimum of the workforce has been laid off, or threatened with layoffs, in the 12 months preceding the date of the petition (the relevant minimums are three workers in groups of fewer than 50, or 5 percent of the workforce in groups of 50 or more)
- One of the following conditions is met:
- Increased imports “contributed importantly” both to an actual decline in sales or production and to a layoff or threat of a layoff
- There has been a shift in production to certain countres outside the United States and/or there has been or is likely to be an increase in the import of like or similar articles
- A loss of business as a supplier of component parts, a final assembler, or a finisher for a TAA-certified firm “contributed importantly” to an actual decline in sales or production, and to a layoff or threat of a layoff
To obtain TAA or ATAA reemployment services and benefits, a group of workers must first file a petition with the U.S. Department of Labor’s Division of Trade Adjustment Assistance requesting certification as workers adversely affected by foreign trade. An application for a job search allowance must be submitted before a job search begins. Applications may be submitted prior to certification, but will only be approved if the worker group is certified. An application for a job search allowance must be submitted before the 365th day after the layoff or certification, whichever is later, or 182 days after the conclusion of training.
If the worker group meets the necessary group eligibility criteria, a certification will be issued. After a group certification is issued, each worker in the group may apply for individual services and benefits through the local “One-Stop Career Center” to determine individual eligibility for TAA and ATAA services and benefits. Workers age 50 and older may be eligible to receive benefits under either the TAA program or the ATAA program. All other workers may only apply for TAA benefits.
Services And Benefits Offered
Rapid Response Assistance – Rapid Response assistance is provided to every group of workers on whose behalf a petition is filed. Rapid Response staff educate employees regarding services available to workers after a layoff is announced.
Reemployment Services – These services will help identify appropriate training programs, and help workers obtain reemployment at the conclusion of the training program.
Job Search Allowances – Allowances may be payable to cover expenses incurred in seeking employment outside a certified worker’s normal commuting area, if a suitable job is not available in the area. Job search allowances reimburse 90 percent of the total costs of allowable travel and subsistence, up to a total of $1,250.
Relocation Allowances – Allowances may be available to reimburse approved expenses when certified workers must move to a new area of employment outside their normal commuting area. Relocation allowances may include: (1) up to 90 percent of the reasonable and necessary expenses of moving workers who have secured employment outside of their normal commuting area, their families and their household goods; and (2) a lump sum payment equal to three times workers’ average weekly wages (but no more than $1,250) to help them settle in new locations.
Training – The Department of Labor provides training to certified workers who do not have the skills to secure suitable employment in the existing labor market. Training is targeted to a specific occupation and provided to help certified workers secure employment at a skill level similar to or higher than their layoff employment. In order for an individual to receive training, certain approval criteria must be met.
Income Support – Trade Readjustment Allowances (“TRA”) are available to provide income support to individuals while they are participating in full-time training. Under certain circumstances, TRA is also available to certified workers for whom training is not feasible or appropriate.
Health Coverage Tax Credit – Workers who are eligible to receive income support under the TAA program may be eligible to receive tax credits for 65 percent of the monthly health insurance premium they pay.
How The Program Can Help Businesses Affected By Changes In Trade Conditions
Businesses that must lay off workers because of trade-related conditions may apply for TAA and ATAA assistance on their employees’ behalf or educate their employees regarding how to take advantage of benefits available under the program. In addition, Trade Act program assistance may augment, or provide an alternative to, laid off employees’ severance packages. Proactive use of the Trade Assistance program can assist businesses in maintaining favorable public relations and remaining in good standing with the U.S. communities in which they operate, even as they engage in the unpleasant business of terminating workers.
According to a Jan. 9, 2009, report by Inside U.S. Trade, reauthorization and expansion of TAA is likely to become part of the economic stimulus legislation being promoted by the incoming Obama administration. The report contains speculation that TAA legislation would extend coverage to services workers and would increase the scope of benefits available under Trade Act programs.