The Implementation and the Impact of the Trade Adjustment Assistance

Extension Act of 2011January 27, 2012 1-2pm

Lindsay Webb, TAA Coordinator, National Employment Law Project

Ragini Kapadia, Senior Economic Analyst, Working for America Institute

Moderated by Lynn Minick, National Employment Law Projectwith Presentations by the IRS Health Coverage Tax Credit Program and the Minnesota Department of Employment and Economic Development

Ragini Kapadia, Senior Economic Analyst,AFL-CIO Working for America Institute

Findings and Resources on the Trade Adjustment Assistance

Act

W W W.TA A H E L P S .O R G

The Working for America Institute

• The AFL-CIO Working for America Institute (WAI) is a union-sponsored, nonprofit organization dedicated to creating good jobs and building strong communities.

• WAI has made significant progress in articulating a vision of a high road economy—an economy that competes in today’s global marketplace on the basis of innovation, quality and skill rather than on low wages and a lack of benefits.

US DOL Technical Assistance Grant

• 8 State Partners: CA, IN, MA, MI, MN, NY, OH, PA

• National Partner: NELP• Technical Assistance to Unions, Employers,

Union-Sponsored Workforce Development and Dislocated Workers Programs

Challenges

• Workers eligible for TAA do not take full advantage of TAA retraining and reemployment services

• Lack of awareness and information on TAA that is accessible and relevant to trade affected workers

• Uncooperative employers who hold up and delay the TAA petition process

• Consistent guidelines and capacity for state outreach on TAA

• Disconnect between local unions and resources on TAA

Best Practices

• Enrolling trade affected workers at the earliest date possible: Case Studies in Pennsylvania

• Coordination and integration of services involving large regions and multiple jurisdictions: the NUMMI Case Study in California

• Utilization of social networks and multimedia to increase awareness on TAA

• Partnerships between employers, unions, and state workforce agencies.

The Trade Adjustment Assistance Extension Act of

2011

Lindsay Webb, TAA CoordinatorNational Employment Law Project

Trade Adjustment Assistance

• NELP promotes TAA as the best existing dislocated worker program– Only TAA provides income support AND training for

dislocated workers– TAA includes limited health care option—HCTC

• With 2011 reauthorization, substantial TAA improvements from 2009 were retained: – Eligibility for service workers as well as manufacturing

workers– Incumbent worker training for “at risk employment.” – Offshoring coverage for shifts to all countries– Retains higher level of spending ($575 M)

The Law that governs TAA

• Most recent TAAEA was signed into law by President Obama on Oct. 21, 2011

• But it is still referred to as The Trade Act of 1974 (19 U.S.C. § 2271 et seq.) as amended

• This Act Creates 3 distinct program (2002, 2009, 2011)• Each program has a different sets of rules:

– 20 CFR 617;– 20 CFR 618– TEGL 11-02 (2002)– TEGL 22-08 (2009)– TEGL 10-11 (2011)

Petition Number Grid

TAA Law Petition Number Applicable Date Election Option

2002 Amendments Below TA-W-70,000 Before May 18, 2009 NO

2009 Recovery Act TA-W-70,000 to TA-W-79,999

May 18, 2009 to Feb. 14, 2011 NO

2002 “Gap” Program TA-W-80,000 to TA-W-80,999

Feb. 14, 2011 to Oct. 21, 2011 YES

2011 Amendments TA-W-81,000 After Oct. 21, 2011 NO

Worker Election

• Petitions filed between Feb. 14, 2011 and Oct. 21, 2011 (so-called gap period) are impacted. – Those petitions (80,000 – 80,999) still under investigation

will be considered under 2011 rules. – Those petitions denied during this period will be

reconsidered. • And, workers certified under one of these petitions

who sought TAA services will have an election between the 2002 Act and the 2011 Act benefits. – The election period begins Dec. 20, 2011 and ends March

19, 2012.

Certification Pointers

• There are two ways to be certified as a primary certification: – Shift in production or increase in import

• Shifts in Production – Must show jobs transferred to any country. – Prove shift in production through employer admission or

other evidence provided by petitioner

• Increase in Imports – Must be like or directly competitive – “contributed importantly” to layoffs

» important cause, but not necessarily more important than any other cause

Certification Pointers

• However, firms for can be certified as a secondary certification if: – They are a direct supplier of component parts to

certified primary firm that accounted for 20% of production or sales OR loss of business with primary firm “contributed importantly” to layoffs, OR

– If they are a Downstream producer providing additional, value added production directly for primary firm

TAA Eligibility

Two step TAA eligibility process• Group Eligibility (by workplace)

– Petition for eligibility with U.S. Labor Department (3 workers, union, employer, state or local workforce agency, governor)

• Individual Eligibility (by worker)– Individual application and processing for certified

workers, often after group orientation

Impact Date

• Under 2002 and 2009 the impact date was generally a year from the date of certification.

• BUT, under 2011, the impact date is extended for all certifications filed between October 21, 2011 and the January 19, 2012.– The new impact date for these certifications is

February 13, 2010. • So, anyone laid off from that date to 26 weeks after

certification will be covered

Weeks of Income Support Vary by Act

Trade Adjustment Assistance Act 2002 2009 2011

Regular State Benefits 26 26 26

Basic Trade Readjustment Allowance (TRA) 26 26 26

Additional Trade Readjustment Allowance (TRA) 52 78 65

Remedial Trade Readjustment Allowance (TRA) 26 26 ---

Completion Trade Readjustment Allowance (TRA) --- --- 13

Maximum Number of Weeks 130 156 130

Note: Trade Adjustment Assistance participants must exhaust regular federal and state unemployment insurance benefits before starting TRA. The weeks of regular federal and state unemployment insurance benefits count toward the maximum number of weeks available. For example, in recent years, unemployed workers may have qualified for up to 99 weeks of federal and state unemployment benefits. Under the 2011 Act, a worker who received 99 weeks of regular benefits would, at most, be eligible for 31 weeks of TRA for a total of 130 weeks. [1] Regular State Benefits: Most states offer 26 weeks of regular state benefits.[2] Basic TRA: Income support available to all TAA-certified workers, even workers on a training waiver. However, the 2011 Amendments reduce reasons for a waiver.[3] Additional TRA: Income support available to workers in approved training.[4] Remedial TRA: Income support for workers in training who requires remedial training.[5] Completion TRA: Income support for workers in active training and meeting performance benchmarks.

2002 TRA Overview

26 weeksUnemploymen

t

26 weeksBasic TRA

52 weeksAdditional TRA

26 weeksRemedial TRA

+ +

+

= 104 weeks

= 130 weeks

TRA Overview

26 weeksUnemployme

nt

Benefits

104 weeks

TRA

13 WeeksCompletion of Degree or Credential

+ = 130 weeks BUT LAST

Completion TRA• To receive Completion TRA,

– a worker must have exhausted Additional TRA, and – need completion TRA to finish a degree or industry-recognized

credential and – met and continue to meet the performance benchmarks

established in the approved training plan and – participate in training in each week he/she receives

Completion TRA• Training benchmarks are agreed to and initiated at the start of the

training plan and reviewed every 60 days.• Evaluation criteria:

– Satisfactory academic standing– On schedule to complete training according to training plan

Approval of TAA Training

Six Conditions for Approval of TAA Training• No suitable employment for the worker. • Worker would benefit from appropriate training. • Reasonable expectation of employment following

training. • Training is reasonably available to the worker. • Worker is qualified to obtain and complete the training,

including having adequate financial resources available to complete the training when income support is exhausted.

• The training is suitable and available at a reasonable cost.

Enrollment Deadlines

• Must be enrolled in training OR have a training waiver by the LATEST of– the end of the week after the week that is 26 weeks after

TAA certification OR– the end of the 26th week after the worker’s most recent

total separation from affected employment

• One 45 day extension for “extenuating circumstances”

• 210 Day Rule—Applies to Additional Tar• Equitable Tolling—TEGL-08-11

Training Waivers

Dropped after 2011 changes:• Worker will be recalled reasonably soon; or• The worker has marketable skills for suitable employment

and a reasonable expectation of employment in the foreseeable future; or

• The worker is within two years of eligibility for a pension or social security;

Remaining after 2011 changes:• The worker is unable to participate in or complete training

due to the health of the worker; or• Immediate enrollment is not available; or • No training program is available.

Job Search & Relocation Allowances

• Up to $1250 to cover up to 90% of travel and subsistence costs (2011 change)

• Must be pre-approved, no local employment available

• Not more than 365 days after layoff or certification, or 182 days after completion of training

• Pays up to 90% of moving costs and travel to accept employment outside normal commuting area

• Must be pre-approved, no local employment available

• Pays up to 90% of charges or maximum of $1250 (2011 change)

• Must apply within 425 days of layoff or certification, or 182 days of completion of training

No longer considered an entitlementSubject to state funding availability and preapproval

Reemployment TAA

• Must be 50 years or older and separated from TAA certified employment

• Worker accepts new work by end of 26th week after layoff or certification, whichever is later

• ATAA pays 50% of difference between the prior wage and the new wage up to a maximum of $10,000 over 2 years, whichever comes first.

• Annual wage must be less than $50,000• Electing RTAA no longer cuts off other TAA options,

including part time training• No separate certification required

Petitions TA-W-69,999 and below

Petitions TA-W-70,000 through TA-W-79,999

Petitions TA-W-80,000 to TA-W-80,999 for workers who begin receiving services before Dec. 20, 2011

Petitions TA-W-81,000 and above

2002 Law Benefits 2009 Law Benefits 2002 Law Benefits 2011 Law Benefits 2011 Law Benefits

Eligibility Manufacturing workers

Workers who have lost their jobs because their

company’s decline in production and/or sales

was due to increased imports or the

outsourcing of jobs to a country with which the

US has a Free Trade Agreement

Manufacturing workersService sector workersPublic sector workers

ITC workers (those who work for a firm that has been identified by the

International Trade Commission as in a

domestic industry that has been injured/is a

party to a market disruption)

Workers who have lost their jobs because their

company’s decline in production and/or sales

was due to increased imports or outsourcing

to ANY country

Manufacturing workers

Workers who have lost their jobs because their

company’s decline in production and/or sales

was due to increased imports or the

outsourcing of jobs to a country with which the

US has a Free Trade Agreement

Manufacturing workersService sector workers

ITC workers (those who work for a firm that has been identified by the International Trade Commission as in a domestic industry that has been injured/is a party to

a market disruption)Workers who have lost their jobs because their

company’s decline in production and/or sales was due to increased imports or outsourcing to ANY country

Trade Readjustment Allowance

Up to 104 weeks (enrolled in full-time

training) ORUp to 130 weeks

(enrolled in remedial training)

8/16 rule applies

Up to 130 weeks (enrolled in full-time

training) ORUp to 156 weeks

(enrolled in remedial training)

26-week rule applies

Up to 104 weeks (enrolled in full-time

training) ORUp to 130 weeks

(enrolled in remedial training)

8/16 rule applies

Up to 130 weeks available to workers enrolled in full-time training, the last 13 of which are only available if

needed for completion of a training program and training benchmarks are met.

26-week rule applies

Training Waivers 1. Worker will be recalled to work reasonably soon2. Worker has marketable skills for suitable employment and a reasonable expectation of employment in the foreseeable future3. Worker is within two years of eligibility for a pension or social security4. Worker is unable to participate in or complete training due to health condition5. No training program is available6. An enrollment date is not immediately available

1. Worker is unable to participate in or complete training due to a health condition2. No training program is available3. An enrollment date is not immediately available

Health Coverage Tax Credit 72.5% of qualifying health insurance premium costs

Petitions TA-W-69,999 and below

Petitions TA-W-70,000 through TA-W-79,999

Petitions TA-W-80,000 to TA-W-80,999 for workers who begin receiving services before Dec. 20, 2011

Petitions TA-W-81,000 and above

2002 Law Benefits 2009 Law Benefits 2002 Law Benefits 2011 Law Benefits 2011 Law Benefits

Job Search Allowance

Relocation Allowance

90% of allowable job search costs up to $1,250

90% of allowable relocation costs, plus additional lump sum

payment up to $1,250

100% of allowable job search costs up to $1,500

100% of allowable relocation costs, plus an

additional lump sum payment up to $1,500

90% of allowable job search costs up to $1,250

90% of allowable relocation costs, plus an

additional lump sum payment up to $1,250

Up to 90% of allowable job search costs, up to a maximum of $1,250, available at state discretionUp to 90% of allowable relocation costs, plus an additional lump sum payment of up to $1,250,

available at state discretion

Training Funding

Case Management Funding

$220 MillionCap Applies to Training

Funds OnlyAdditional 15% available

for administration. Additional funds are

available for job search & relocation allowances. No

funds are available for case management and employment services.

$575 MillionCap Applies to Training

Funds OnlyAdditional 15% available for administration, and case management and

employment services. At least 1/3 of these funds must be used for case

management and employment services.

States also receive $350,000/year for case

management and employment services.

Additional funds available for job search

and relocation allowances.

$220 MillionCap Applies to Training

Funds OnlyAdditional 15% available

for administration. Additional funds are

available for job search & relocation allowances. No

funds are available for case management and employment services.

$575 MillionCap Applies to training, job search & relocation allowances, case management and employment

services, and associated administration.• No more than 10% of the amount provided may be

spent for administration;• No less than 5% or the amount provided may be

spent for case management and employment services.

• DOL may recapture from the states funds remaining unobligated after two or three years and distribute such funds to states in need of funds.

Alternative Trade Adjustment Assistance (2002)/Reemployment Trade Adjustment Assistance (209/2011)

Requires separate group certification

Available to workers earning less than an

annual salary of $50,000Maximum total benefit

of up to $10,000Training benefit NOT

available

Does not require separate group

certificationAvailable to workers earning less than an

annual salary of $55,000Maximum total benefit

of up to $12,000Training benefit is also

available

Requires separate group certification

Available to workers earning less than an

annual salary of $50,000Maximum total benefit

of up to $10,000Training benefit NOT

available

Does not require separate group certificationAvailable to workers earning less than an annual salary

of $50,000Maximum total benefit of up to $10,000

Training benefit is also available

Minnesota’s Approach: TAAEA 2011 Implementation and Impact

January 27, 2012

Debra SchlekewyDebra.Schlekewy@state.mn.us

What Will We Cover?

• Minnesota’s approachto TAA

• 2011 Implementation activities and concerns

• Accomplishments and challenges

The Minnesota Model of TAA

• Absolute, 100 percent co-enrollment with Dislocated Worker

• Centralized staff (seven) handle the entire statewide caseload

• Agency leads petition process

33

What Does Co-Enrollment Mean?

1. Every person eligible for TAA, is automatically eligible for Dislocated Worker.

2. Each job seeking customer gets a Dislocated Worker counselor (in field) and a TAA specialist (in St. Paul).

3. The counselor and specialist work together to ensure easy service.

4. More resources available for each customer.34

2011 TAAEA Enactment

• Signed into Law on October 21, 2011

• New program benefits and services began immediately

• The TAA program administers three distinct sets of rules for the 2002, 2009, and 2011 provisions

2011 Implementation activities

• 2011 Choice process

• Waiver changes

• TRA changes

• State’s discretion for job search and relocation allowance

• Training Benchmarks

2011 Choice/Election Process2011 TAAEA Choice Process

1. Available to TAA participants covered under an 80,000 series petition and served under the 2002 program.

2. Participants can make a one-time choice between 2002 or 2011 program.

2011 Choice/Election Process2011 TAAEA Choice Process

2. As of Dec. 20, 2011, are you receiving any of the

following benefits or services?

If the petition is numbered 81,000 and above or from

80,000-80,999 and the participants have not received

any benefits, workers automatically eligible to apply for 2011 Program benefits and services (no election required)

TRA/ATAA Payment

Training waiver

Enrolled in training, participated in

training, or completed training

Been approved for job search or relocation allowances (even if

payment has not yet been made)

Worker can stay on the 2002 Program, or can elect to take advantage of the benefits and services offered by the 2011 Program. This choice must

be made before March 19, 2012.

Yes

No

No No No

Yes

Yes Yes

Yes

1. Is your petition number between

80,000 and 80,999?

Training Waiver Requirement Changes

2002 and 2009 TAA Programs• Six options:

• Health Condition• Enrollment in Training

is not Available• No Training is

Available• Recall • Marketable Skills• Retirement

2011 TAAEA Program• Three options:

• Health Condition• Enrollment in

Training is not Available

• No Training is Available

40

2011 TRA changes

• Elimination of Remedial and Prerequisite TRA.– Remedial and prerequisite training should continue to

be part of an approved training plan where appropriate.

• Addition of Completion TRA– Provides participants with up to 13 additional weeks of

TRA within a 20 week period in order to complete their training plan.

• Concern: – Fall and Spring semesters run 17-18 weeks.

– Participants who exhausting Completion TRA before finishing their training program may be in jeopardy of an overpayment.

Maximum TRA Eligible Weeks

2002: 130 potential weeks

– Up to 26 weeks of Unemployment Insurance

– 26 weeks of Basic TRA– 52 weeks of Additional TRA– 26 weeks of Remedial TRA

2009: 156 potential weeks

– Up to 26 weeks of Unemployment Insurance

– 26 weeks of Basic TRA– 78 weeks of Additional TRA– 26 weeks of Remedial/Prerequisite TRA

2011: 130 potential weeks

– Up to 26 weeks of Unemployment Insurance

– 26 weeks of Basic TRA– 65 weeks of Additional TRA– 13 weeks of Completion TRA

Job Search & Relocation Allowances

• 2011 reverts back to 2002 levels, although states will not receive additional funds to administer these benefits.

• 2011 TAAEA allows states’ discretion to offer workers Job Search and Relocation Allowance benefits.

• Minnesota will continue to provide these benefits.

• Nine out of ten states in our region have elected to offer these benefits.

Training Benchmarks

• Two criteria:• Satisfactory academic standing• On track to complete training within the agreed upon timeframe

• Reviews conducted at 60 day intervals after training begins.

• Documented in individual plans and signed by participant.

• Encourages intervention and modification of unsuccessful training plans, and modifications to complete credentials.

• Minnesota is designing a state-wide individual TAA plan through our case management database.

• TAA regularly meets or exceeds standards• High performance persists through recent

economic hardships

Accomplishments - Outcomes

Trade Adjustment Assistance (TAA) At-a-Glance Statewide Performance Program Year 2010 (July 1, 2010 - June 30, 2011)

ServedGetting a

Job Standard

Getting a Job

Results

Keeping a Job

Standard

Keeping a Job

Results

Credential Rate

Standard

Credential Rate

Results

2 Qtr Wage Standard

2 Qtr Wage

Results

3,144 83.0% 87.5% 88.0% 94.8% 62.0% 65.1% $16,400 $17,619

Accomplishments - Improvements

• 2010 - revised entire application process

• 2011 - revised purchase order process

• 2011 - established participant portal /applytaa

• 2011 and 2012 - clarify case management model

www.positivelyminnesota.com/applytaa

• One-stop shop for the new TAA customer

• Public site, with only a “side door”

• Will always have the most recent information on TAA relevant to Minnesota

• We are developing a “Counselor Portal”

Accomplishments –

The Minnesota TAA team was nominated for a 2011 Governor’s Continuous Improvement award.

Challenges for 2012

1. Train counselors intensively on the clarified case management model and waiver confusion;

2. Continued implementation the latest TAA law;

3. Integrate and develop new staff;

4. Maintain pace of continuous improvement with initiatives to enhance customer notification, process payments more quickly, and integrate with TRA processes.

48

The Health Coverage Tax CreditTrade Adjustment Assistance Extension Act of 2011

Last Update: December 2011

Question and Answer

For more information:

The Working for America Institutewww.workingforamerica.org

Ragini Kapadia, Sr. Economic Analyst, rkapadia@workingforamerica.org

The National Employment Law Projectwww.nelp.org

Lindsay Webb, TAA Coordinator, lwebb@nelp.orgLynn Minick, Dislocated Worker Specialist, lminick@nelp.org

MN’s Department of Employment and Economic Developmentwww.positivelyminnesota.com/taa

Debra Schlekewy, Program Coordinator, Debra.Schlekewy@state.mn.us

IRS Health Coverage Tax Credit Stakeholder Engagement www.irs.gov/hctc

For questions or materials, email: hctc.stakeholder.team@hctc.irs.gov