A bill to expand the safety net for displaced workers was introduced by House Education and the Workforce Committee Chairman John Boehner (R-Ohio), and Reps. Sam Johnson (R-Texas) and Howard “Buck” McKeon (R-Calif.). The bill — dubbed the “Back to Work Act” (HR 3112) — would authorize $3 billion in special National Emergency Grants (NEGs) to states to help displaced workers maintain their health care coverage, supplement their income and receive job training. If adopted, the bill would authorize President George W. Bush’s plan to expand the federal “safety-net” for workers displaced in the wake of the Sept. 11 attacks on New York and Washington.

According to Boehner, the bill would permit states experiencing “a major plant closure, mass or multiple layoffs, or dislocations” to apply for NEGs. These grants would be awarded “if the governor of a state certifies that the terrorist act of Sept. 11 contributed importantly to the closure, layoffs or dislocations.” States that receive the grants could use the funds to:

• pay up to 75 percent of health care premiums covered by COBRA for up to 10 months after the worker is laid off
• provide additional weeks of income support for individuals who have used up their unemployment compensation or individuals who are ineligible for unemployment compensation but are able to show that they were working, and
• provide a full array of job search and training services, including customized training, placement assistance, and relocation expenses.

“We think this is a good start. We think the president’s proposal to set aside $3 billion for displaced workers is the right approach,” said Deborah Sims, chair of NACo’s Labor and Employment Steering Committee and Cook County, Ill. commissioner.

“But we think that some of these funds should be distributed by formula to local areas. States should take care of the medical insurance and unemployment payments through their unemployment insurance programs. Job training and job search assistance should be provided locally through the existing one-stop system.”

In testimony before the committee, Secretary of Labor Elaine Chao praised the bill as an appropriate response to the current economic crisis. She noted that programs for dislocated workers exist and that programs are operating in an effective manner.

“The Workforce Investment Act system is a very flexible and vigorous system … that we want to ‘turbocharge’ with an additional $3 billion for National Emergency Grants,” she said. Chao also praised the one-stop offices operated locally and supported by local workforce investment boards, calling them the nation’s “reemployment offices.”

“This is a system that is up and running and can do the job,” said Chao.

National Emergency Grants are grants that go to governors and local areas to address mass layoffs within specific industries. What they do not do is address the problems faced by individuals who are laid off from smaller businesses or self-employed individuals who find themselves out of work.

For this reason, NACo is asking Congress to consider giving a significant portion of the funds to local workforce investment areas through formula funding. “We think that at least a third of the funds should be available to local areas through formula funding. These funds would be made available to one-stop centers to provide direct job training and job search services to displaced workers,” concluded Sims.

The Senate is also considering providing assistance to displaced workers though no formal proposal has been developed.