IAWP LEGISLATIVE INFORMATION April/May 2007 Archives Home Page ***Weekly Update*** From Legislative Committee Chair: Todd Kolden, Aberdeen Central Office Week of April 9, 2007 ETA ANNOUNCES STATE ALLOTMENTS FOR PY 2007 FOR WIA TITLE I PROGRAMS, WAGNER-PEYSER AND TAX CREDIT PROGRAMS • The Employment and Training Administration (ETA) announced today the state allotments for program year (PY) 2007 (July 1, 2007-June 30, 2008) for Workforce Investment Act (WIA) Title I programs, Wagner-Peyser and tax credit programs. The April 6, 2007, Federal Register details the allotment amounts. The WIA allotments for states and the final allotments for the Wagner-Peyser Act are based on formulas defined in their respective statutes. MARCH 2007 UNEMPLOYMENT RATE UNCHANGED AT 4.4 PERCENT • The Bureau of Labor Statistics reported today that nonfarm payroll employment rose by 180,000 in March, and the unemployment rate was essentially unchanged at 4.4 percent. The jobless rate has remained within a narrow range - 4.4 to 4.6 percent - since September 2006. Both total employment, at 146.3 million, and the employment-population ratio, at 63.3 percent, were essentially unchanged in March. • In March, nonfarm payroll employment increased in construction, retail trade, and health care. Construction employment rose sharply, following a large decline in February. Employment in construction increased by 56,000 in March, mostly offsetting a decline of 61,000 the prior month. Inclement weather likely contributed to February's decline. Overall, the construction industry has shown no net growth since employment peaked in September 2006. Since September 2006, job gains in the nonresidential components of construction have been more than offset by losses in the residential components. • Within retail trade, a sizable job gain occurred in general merchandise stores, rising by 36,000 in March and by 81,000 in the first quarter of this year. Despite the recent growth, employment in general merchandise stores was little changed over the year. Employment in health care continued to increase in March; over the year, the industry has added 348,000 jobs. The number of manufacturing jobs continued to trend down March. ETA ISSUES INFORMATION ON AJB PHASE-OUT • The Employment and Training Administration (ETA) this week issued Training and Employment Notice (TEN) 27-06 to inform states and local areas about the phase-out of America's Job Bank (AJB), scheduled to begin after June 30, 2007. The guidance provides brief background on reasons for the phase-out, details on what will be provided to take the place of AJB and an outline of the non-financial support ETA will provide states during the transition period. ETA notes in the guidance that it is developing the ability to direct businesses and job seekers to both public and private sector job banks that are comparable to AJB. ETA will accomplish this by providing a listing of web links to qualified web sites on a web "splash" or notification page. The page is expected to be available in late spring. • The ETA notes it has and will continue to provide non-financial assistance. Thus far, ETA conducted a series of informational webinars to identify the impacts of the phase-out, identified and resolved legal and administrative issues related to the release of AJB software, created a data sharing agreement in cooperation with New York State in preparation of sharing AJB employer and job seeker information with the thirty-five requesting states, developed a communication plan for employers and job seekers who registered with AJB to advise them of the phase-out and other activities to transition the phase-out. JOB CENTRAL NATIONAL LABOR EXCHANGE PROVIDED AT NO COST TO ALL EMPLOYERS • Direct Employers Association recently made clear to the U.S. Department of Labor that Job Central National Labor Exchange will provide job seekers, employers, and states a cost-effective transition from America's Job Bank (AJB) when it is discontinued on July 1, 2007. • Under the terms of the alliance agreement, all services provided to job seekers and participating states will be at no cost. The following services will be provided to all employers in participating states, regardless of size, in all industries at no cost: (1) job postings; (2) job postings for veterans; and (3) resume searching. • Job Central National Labor Exchange is supported by DirectEmployers Association member companies to promote labor market efficiency and assure compliance with state and federal job posting requirements under the Vietnam Era Veterans' Readjustment Assistance Act (VEVRAA), Jobs for Veterans Act (JVA) and Affirmative Action programs. JOBCENTRAL NATIONAL LABOR EXCHANGE: DIFFERENCE BETWEEN "SPIDERING" AND "INDEXING" • The term "spider" in the State Workforce Agency Participation Agreement on the JobCentral National Labor Exchange apparently has caused some confusion and needs clarification. • JobCentral "indexes" jobs from corporate web sites and does not actually use a "spidering" process as it is known in the industry. The word "spider" was used in the State Workforce Agency Participation Agreement because it is a commonly used Internet term and is often used interchangeably with indexing. However, the difference is significant. • "Indexing" allows JobCentral to identify links to jobs and take the job seeker directly to the job listing on the corporate web site when he or she clicks on the job title. This process is very much like the search process used by Google and other high-level search engines. • "Spidering" is the process of grabbing the job content from a web site, reformatting it, and displaying that content on a web site. This is not the process used by JobCentral. • Another important point is that JobCentral only indexes jobs from corporate web sites. Jobs from commercial job boards (Monster, CareerBuilder, Hotjobs, etc.) are never indexed. This means the probability of duplicate jobs is very low in the JobCentral database and all jobs are current, active job listings. JobCentral indexes jobs from corporate web sites at least once a day, and in some cases as many as three times a day, to make sure the most accurate, up-to-date job listings are available. ETA ISSUES ADMINISTRATIVE GUIDANCE FOR WOTC AS APPROVED THROUGH DECEMBER 31, 2007 • The Employment and Training Administration this week released Training and Employment Guidance Letter (TEGL) 20-06 to provide state workforce agencies guidance on the administration of the Work Opportunity Tax Credit (WOTC) program as approved by the Congress and President late last year. Legislative authority for the WOTC program and the Welfare-to-Work Tax Credit (WtWTC) expired on December 31, 2005, but was retroactively extended with modifications to the program through December 31, 2007. The newly released TEGL provides procedural guidance to the states for processing requests for certification under the amended program. • Under the new program, the WOTC and WtWTC provision are extended an additional two years, to include wages paid or incurred for individuals beginning work after December 31, 2005, and before January 1, 2008. For wages paid or incurred for individuals who begin work for the employer after December 31, 2006, the law combines the two credits, expands eligibility for WOTC by raising the age ceiling for food stamp recipients from 25 to 40, eliminates the WOTC family income restrictions for ex-felons, and extends the paperwork filing deadline from 21 to 28 days. Week of May 7, 2007 NASWA AND NGA SUPPORT COMMON MEASURE PROPOSAL AS CONGRESS PREPARES TO REAUTHORIZE WIA NASWA has partnered with the National Governors' Association (NGA) in support of a common measure proposal to monitor workforce system performance. The measures were approved by the NASWA Legislative Committee, comprised of the NASWA Executive Committee members and two Regional Directors appointed by the President. Under NASWA By-laws, the Committee considers federal legislative issues guided by existing Association policy to the extent possible. The common measure proposal was forwarded to Congress this week with the request that it be added to legislation still under development by the House and Senate to reauthorize the Workforce Investment Act. According to Senate staff, the Senate is nearly ready to introduce its bill, which is likely similar to the legislation (H.R. 27 EAS) approved by the Senate last Congress. The Senate's WIA bill approved last Congress was approved under a House bill designation because the Senate after receiving the House approved bill replaced the House language with its language first developed under S. 1021. Senate staff requested any legislative proposals be developed in reaction to H.R. 27 EAS to simplify consideration and possible incorporation into the bill. The NGA-NASWA Common Measure proposal would streamline the complex system of nearly 100 varying and incomparable performance measures into four measures focused on customer outcomes, including short-term and long-term employment rates, earnings, and credential completion. The intent of the NGA-NASWA proposed legislative language is to replace all performance measures and additional indicators across all programs directly or indirectly authorized under WIA, including WIA Dislocated Worker, Wagner-Peyser, WIA Adult, WIA Youth, Job Corp, Veterans' programs and related programs at the U.S. Department of Education, including Adult Education and Rehabilitative Services. The nation's governors included the WIA common measures proposal in the federal legislative package on competitiveness entitled "Innovation America: A Partnership" aimed at modernizing the workforce system and better serving workers and businesses. Week of May 21, 2007 CHAIRMAN OF HOUSE WAYS AND MEANS SUBCOMMITTEE REQUESTS ADDITIONAL UI FUNDING FROM APPROPRIATORS • Congressman Jim McDermott (D-WA), Chairman of the House Subcommittee on Income Security and Family Support last week sent a letter to the Chairman and Ranking Member of the House Appropriations Committee to request additional funding for Unemployment Insurance (UI) system operations. Chairman McDermott requests amounts consistent with what the states believe is necessary for efficient and effective Unemployment Insurance (UI) system administration under the Resource Justification Model (RJM). The letter notes that the Administration's fiscal year 2008 request for UI system operations is the second smallest per claim allotment since 1986, surpassed only by the fiscal year 2007 appropriation. • The letter from Congressman McDermott is important for its recognition of a longstanding state concern over the inadequacy of federal funding for UI system operations and because it helps bridge the communication gap between the Congressional panels responsible for UI system authorizing and appropriating. Chairman McDermott's Subcommittee has authority to make changes to the federal law establishing UI program operations, but it is the House and Senate Appropriations Committees that approve annual amounts granted to carry out UI system operational requirements. Staff to the House and Senate Committees on Appropriations must balance requests received from the innumerable interest groups vying for their share of the appropriations pie. Although Members on these panels hear from states on UI funding, the impact has not been enough to compete with some of the most influential and powerful domestic lobbies within the education and health care communities. CONGRESS APPROVES BUDGET GIVING GREEN LIGHT TO APPROPRIATIONS COMMITTEES TO BEGIN MOVING BILLS • The House and Senate last week reached agreement on a concurrent budget resolution (S. Con. Res. 21) proposing to fund fiscal year 2008 federal government operations at a level $21 billion more than requested by the President. Approval of the budget resolution allows the House and Senate Appropriations Committees to begin the work of approving their twelve spending bills, including the Labor, Health and Human Services (HHS) and Education spending bill that funds the workforce system. • With this week the last Congressional work period before the week long Memorial Day recess, the labor program spending bill is not likely to be considered until sometime in June. Congress is scheduled to work through June and July but is in recess through August. The Senate is currently scheduled to approve all spending bills by mid-September. House and Senate staff are hopeful all spending bills can be approved before the beginning of fiscal year 2008 begins on October 1. However, given the overall spending amount approved in the budget resolution is significantly higher than the President's request, approval of the bills may take longer. President Bush has expressed concern already with the potential size of spending bills and members of the House Minority have begun circulating petitions to show that any prospective veto could not be overruled. • Included in the approved budget resolution is language authorizing the expenditure of an additional $40 million for re-employment and eligibility assessments (REA) without the amount impacting the overall cost of the labor program spending bill. The Congress appropriated $10 million for REAs in fiscal year 2007 and the Administration added additional funding to this amount from amounts available in unexpended above base funding. If the House and Senate Appropriations Committees adopt the additional amount authorized in the newly adopted budget resolution, the amount available for REAs would more than double to a total of $50 million in fiscal year 2008. IMMIGRATION DEAL WOULD INSTITUTE TOUGHER EMPLOYMENT VERIFICATION AND NEW TEMPORARY WORKER PROGRAMS • Senate negotiators emerged last week with agreement on a plan to provide United States citizenship for illegal immigrants, improve border security and establish new guest worker programs. The agreement would shift the focus of the current immigration system from one centered on family unification to one focused on the employment and skills of immigrants. The Senate is scheduled to consider the newly agreed to proposal on May 21. Passage of the new legislation is far from guaranteed as members from both parties in the Senate and House have begun already to express their opposition with some claiming it is too lenient in offering "amnesty" for illegal immigrants. Negotiators of the deal including Senator Edward Kennedy (D-MA) and Jon Kyl (R-AZ) said they recognize the proposal is imperfect, but it represents middle ground sufficient to move forward. • Under the proposal, all employers would be required to verify electronically the identity and legal status of all new hires within 18 months of enactment or on the date the Homeland Security Secretary certifies the identification system is operational. Employers would have to verify the status of all current employees within three years of enactment. Employees could be verified by presenting both their Social Security number and either a passport, a REAL ID driver's license, or a fraud and tamper-resistant identity card. • The proposal would establish a new temporary worker program for future immigrants, broken into three categories: non-seasonal (Y-1); seasonal (Y-2A and Y-2B); and spouses and minor children (Y-3). Non-seasonal workers would be admitted for a two-year period and could renew their visa twice if they spend at least one year outside the United States between the two-year periods. A non-seasonal worker accompanied by dependents would get a two-year seasonal visa that is not renewable. Seasonal workers would qualify for 10-month visas, although the terms of the visas are still being negotiated. There is an initial cap of 400,000 for the Y-1 visa program, with annual adjustments based on market fluctuations. The Y-3 visas for spouses and children could not exceed 20 percent of the annual limit. Week of April 30, 2007 MINIMUM WAGE INCREASE NOT LIKELY TO BE APPROVED BECAUSE OF TIES TO IRAQ WAR SPENDING BILL • Legislation (H.R. 1591) to increase the minimum wage to $7.25 an hour is likely to be vetoed by President Bush because it is attached to a broader bill that includes Iraq war-related provisions he opposes. Originally fast tracked by the House early in the year and approved by the Senate after the addition of sizable tax incentives for business, the bill stalled over negotiations on the cost of tax breaks it included. Agreement between the House and Senate was reached recently over the size of the business incentives at just under $5 billion, or about half of what the Senate first approved. Agreement aside, the wage and business incentives attachment to the Iraq war supplemental spending bill, which has become the latest political lightening rod between the divided federal government means the final product is not likely to be approved. It is likely the wage hike and business incentive provisions would be signed into law by President Bush if it were sent to him as a stand alone bill, but the direction Congress would take to renew efforts to increase the minimum wage is uncertain. • In addition to increasing the minimum wage in three stages - to $5.85 an hour 60 days after signed into law by President Bush, to $6.55 a year later and to $7.25 a year after that - the bill would extend the Work Opportunity Tax Credit (WOTC) to August 31, 2011. The Senate's bill had included language to extend the WOTC program through January 1, 2013, but concerns over the cost associated with this duration forced negotiators to scale it back. Language to formalize the relationship of Professional Employment Organizations (PEOs) was not included in the agreed to language. Also of note under the section entitled "small business incentives" is language that would establish a program to award grants to states to encourage the creation and operation of employer-operated child care programs. This provision and others are included on pages 69 to 87 of H.R. 1591. Though the near-term outlook for approval of these provisions is not favorable, it is likely the next time minimum wage legislation is again considered that these incentives for business will be attached. Week of May 30, 2007 CONGRESS APPROVED MINIMUM WAGE INCREASE SIGNED BY PRESIDENT BUSH The House and Senate late last week approved legislation (H.R. 2206) to increase the minimum wage to $7.25 over a two-year period. The bill was signed by President Bush. The provision to increase the minimum wage is included in the emergency supplemental spending bill to fund the war in Iraq. Under the bill, the minimum wage would increase from its current level of $5.15 an hour to $5.85 an hour within 60 days of enactment and to $7.25 an hour within two years of enactment. Included with the wage hike are a number of business tax relief provisions including an extension to August 31, 2011 of the Work Opportunity Tax Credit (WOTC). The legislation also would expand eligibility to individuals under WOTC by more broadly defining qualifying veterans, first-year wage earners, high-risk youth and those workers referred through the vocational rehabilitation system. Following today's session, the Congress is in recess the week of May 28 for the Memorial Day holiday. IMMIGRATION BILL COULD BE APPROVED BY SENATE IN EARLY JUNE Despite the strong criticism by a myriad of stakeholders over the recently announced compromise on immigration, the deal brokered between both political parties and the White House remains intact after a week of debate on the Senate floor. Amendments proposed to remove language legalizing illegal immigrants, reduce the duration of the guest worker program and expand law enforcement's authority to question potentially illegal immigrants were all voted down. Any of these proposed amendments, if approved, would have been considered "poison pills" potentially leading Members to not approve of the bill as the coalition backing the legislation would splinter. Lead Minority party negotiator on the bill, Senator Arlen Specter (R-PA) said he is optimistic now the bill could be approved by the second week of debate expected to resume the week of June 4. Under the Senate coalition's proposal, all employers would be required to verify electronically the identity and legal status of all new hires within 18 months of enactment or on the date the Homeland Security Secretary certifies the identification system is operational. Employers would have to verify the status of all current employees within three years of enactment. Employees could be verified by presenting both their Social Security number and either a passport, a REAL ID driver's license, or a fraud and tamper-resistant identity card. The proposal would establish a new temporary worker program for future immigrants, broken into three categories: non-seasonal (Y-1); seasonal (Y-2A and Y-2B); and spouses and minor children (Y-3). Non-seasonal workers would be admitted for a two-year period and could renew their visa twice if they spend at least one year outside the United States between the two-year periods. A non-seasonal worker accompanied by dependents would get a two-year seasonal visa that is not renewable. Seasonal workers would qualify for 10-month visas, although the terms of the visas are still being negotiated. There is an initial cap of 400,000 for the Y-1 visa program, with annual adjustments based on market fluctuations. The Y-3 visas for spouses and children could not exceed 20 percent of the annual limit.