The HIRE, TRAIN & RETAIN Act proposal:

1 - a 26 week, Tier 5 extension of unemployment benefits for current and future 99ers. Also, the funding extension (currently 13 months) should last as long as the tax cut extension, unless the unemployment rate drops below 7% before the tax cut extension ends.

Rationale:
There are already about 5 million 99er’s who have exhausted all benefit extensions that are facing, right now, a bleak future. There are still not enough jobs for them to get, yet there is no more help coming from the government, and in order to qualify for any poverty programs, they would have to give up everything they have worked for (homes, cars, even life insurance and burial plots). For someone who spent 10 or 20 years working to have a home of their own, asking them to sacrifice it now just to exist a little longer or qualify for poverty relief is a bitter blow that is made even worse by the fact that many of these people cannot sell their homes even if they wanted to due to the continued malaise of the housing market. These people are desperate, and their numbers continue to grow, as every week, more and more of the unemployed max out their benefit allotments.

Furthermore, there never was any justification for making the unemployment extension shorter than the duration of the tax cuts, especially when the White House’s own advisors have said high unemployment may last as much as 5 years. What exactly does the White House think will be the bargaining chip next year if the unemployment rate has not dropped significantly? There will be far less leverage for another extension in 2011 or early 2012, once the GOP (who will be in power in the House) already has the one thing they wanted most.


2 - The bill must include a financial incentive plan for hiring and/or training the unemployed. There are three important parts to the incentive plan:

a) a tax rebate for employers who hire directly from the unemployme¬nt rolls, with the incentives scaled so that the longer the worker hired was out of a job, the more the employer that hires them gets (ie: say $2500 for hiring a 99er, but only $500 for hiring someone who has only been out of work for 2 or 3 months).

b) The second part of the incentive program would involve a subsidy for employers that are willing to hire and train unemployed workers whose former job skills are no longer in demand (such as auto workers). The subsidy would cover a percentage of a worker’s salary and medical coverage costs only during the training period (to be determined when the job is posted and based on the level of special skills needed) so that the employer will only absorb the full cost of salary and benefits once they have a fully trained and productive employee.

c) Most importantly, both the rebate and the subsidy would apply ONLY if the employer retains the employee for a full year beyond any training period. So an employer who hires a qualified person who does not need training in January 2011 would be eligible for the rebate in January 2012, as long as the employee was still on the payroll. Similarly, if a worker is hired for a 3-month training period in January 2011, their employer would be eligible for the rebate and subsidy payments in April of 2012, as long as the worker was still on the payroll at that time.

Rationale:
This idea is intended to work directly in conjunction with the Tier 5 extension, as it would spur hiring, and particularly the hiring of the longest-term unemployed, making it likely that by the time the initial Tier 5 extension ends, a majority of the 99ers would have found gainful employment, and that trend would continue as more and more unemployed reach that threshold.

More importantly, much of the cost of the rebates and subsidies would be offset by the increased tax revenue to be gained by putting the unemployed back into the workforce and back on the tax rolls (ie: A worker hired for a $15/hr wage is very likely to pay enough federal taxes the following year to cover most of the cost of the rebate and subsidy their employer will get, and is likely to remain a gainfully employed taxpayer for many years to come as well).

There is a very important reason for making the employers wait until the employee has been in the job for a full year before getting their checks. There are unscrupulous employers out there who would hire people just to qualify for the incentive and then fire them as soon as the check is cashed. This ensures that the worker is guaranteed at least one full year of employment before that happens, as long as they do not do anything to justify being fired. Of course it is still possible that an unscrupulous employer would fire them after that first year – but at that point, with a (hopefully) better economic picture, and the new skills gained at the job for that first year, the individual would then have a much easier time finding new employment.

In addition, there is the issue of fairness. The unemployed must prove on a weekly basis that they have not worked, have not refused any work, and have made a conscientious effort to seek work. It is only fair, then, that the employers who benefit from this incentive program should prove they are serious about retaining the people they hire and are not just scamming the system for the tax rebates.

It is also far cheaper for the government to subsidize on-the-job training than to create and pay for massive retraining programs for the long-term unemployed. This is especially true when you consider that by the time the tax incentives would be payable to the employer, the worker hired will have earned a full year of paychecks, and therefore will be paying taxes that will offset a good portion of the cost of those incentives. More importantly, that worker is likely to remain employed, and remain a taxpayer, for many years to come. This not only helps offset the cost of the program, but also contributes to reducing the deficit in general and promoting a healthy economy. That makes this plan a win-win-win for the worker, the employer (who gets not only the incentive payments, but increased productivity and profits as well), and the government.


3 – There has been a recent trend of companies refusing to hire the unemployed, regardless of qualifications. This has been noted on CNN and by other news outlets, who found some employers were actually stating in their job postings that the “unemployed need not apply”. Therefore, the bill should include a ban on any American company, of any size, discrimina-ting against hiring the unemployed. This should include a fine against companies that violate the policy, with that fine being applied directly to the cost of extended unemployment benefits.


4 – Similarly, many companies are using credit checks to disqualify applicants, even when the job in question has no relationship to handling cash or client or business accounts where a person’s credit history might indicate a risk. Therefore, a ban on companies using an applicant'¬s credit rating as an excuse for not hiring them unless the job in question deals directly with handling cash or having authority over client or company financial accounts would prevent this issue from contributing to both high unemployment and the difficulty faced by the long-term unemployed in finding jobs.

Rationale:
Everyone's credit ratings have suffered during the recession or due to being unemployed - that doesn't make them thieves, nor does it disqualify them from being able to answer a phone, mop a floor, or pack a box in a warehouse. There are some good reasons for checking an applicant’s credit history, but at a time when more than half the nation has suffered either financial losses, job losses, or both, a low score or a few bad marks on a credit report should not be enough to deny employment to an otherwise qualified candidate if the job they will be doing is not related to financial transactions that might tempt pose a risk to the employer or his/her clients.



5 – The final piece of this plan is the creation of a temporary (to last until unemployment returns to normal levels) agency that will maintain a database of unemployment recipients (and those who have exhausted their benefits) and willing employers who register for the incentive programs. The main purpose of the agency will be threefold:

a) To help match the long-term unemployed with employers willing to hire and train them, including working (mostly by phone or email) with job seekers to build a resume and list of marketable skills; and recruiting employers to hire them, using the tax incentives as the lure;

b) To facilitate and administer the incentive program by registering employers, verifying bona-fide offers of employment, following up to ensure the match is successful, and processing the employer’s claim for payment when the initial term of training and employment are successfully completed; and

c) To provide assistance in facilitating the deal, including helping with relocation if a bona-fide job offer is made but the job is more than 50 miles from the worker's current residence, or transporta¬tion if the worker can't access public transit and needs a means to get to the job.


Note: Part of the facilitation process in Part C above could include a one-time grant for those job seekers who have been unemployed for a long time and have no other resources (verification would be important, of course) to assist them with obtaining transportation (ie: a used car, for instance) if they do not have access to adequate public transit to reach the job location, or for relocation expenses if the worker would need to move closer to the job location (say for a job in another state or more than an hour’s drive from their current residence). Since most job seekers would find matches in their own area, and many of those who don’t may still have other resources they can use to enable them to accept an offer, the number of grants needed would be relatively small, and the worker’s return to gainful employment (including the tax liability associated with a higher income) would offset the cost of these grants – if not immediately, then certainly within a couple of years.

Rationale:

The main purpose of the creation of this agency is to eliminate confusion and wasted time & resources by ensuring a targeted matching process between employers willing to hire and/or train workers under the incentive program and job seekers who fit the employer’s needs. This avoids having the employer having to waste time and money weeding through hundreds of applications on his/her own to find the right fit, and provides some reassurance to the job seeker that they are interviewing with an employer who is truly interested in hiring them.

The secondary purpose of the agency is to provide limited support to both employer and employee during the term of the incentive program to help facilitate successful completion and processing of the financial claim for the employer. This support may include limited instances of employment terms negotiation, dispute resolution, and/or replacement assistance if an initial hire is unsuitable to the job requirements.

The third purpose is to ensure that a willing worker who is offered a job that they want, but cannot reach within the limits of their current resources, will have a one-time opportunity to receive help so that they can accept that job. If, for instance, there is a job offer that is 30 miles from the worker’s residence, and the worker has no car, no resources to buy a car, and no access to public transit, then assisting them with obtaining a used car (perhaps bought directly from the vehicles confiscated by the federal government, or from a cache of former federal vehicles) so they can get to the job site reliably would enable them to regain full employment at a relatively small cost (a cost which will be offset, over time, by their increased tax payments once they are working again). Similarly, if a willing worker has a bona-fide offer that is in another state or another part of their own state that is too far even for commuting by car, granting them the resources to move closer to the job location enables them to become gainfully employed, and will be offset over the long term by the increased taxes the worker will be paying.

I would suggest limiting the grant amount to a maximum of $5000, with the final amount to be determined based on the need assessment, resource assessment, and the actual cost estimate of the facilitation (ie: a security deposit and 2 months rent on an apartment plus moving expenses may be more or less expensive than supplying a used car depending on the housing market in the target area, for instance). Furthermore, if it turns out that a job offer is simply too costly for the worker to accept, even with the grant, they would be able to remain in the program and continue looking for a position that is more accessible.

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This is my proposal for necessary and extremely affordable solutions that would provide many tax benefits for businesses of all sizes – provided those businesses are willing to invest in not only their own future, but the future of our economy, by creating jobs, training workers to fill those jobs, and retaining those workers long-term.

It is likely that the GOP would insist on continuing some or all of the tax breaks for the richest Americans and American businesses. This is still unpalatable to many Americans, and especially to Democrats and Liberals. However, if such an agreement were matched by real, active, and immediate job creation solutions such as those listed above, it would have gain far more support.

The primary argument to be made in favor of this plan is simple:

While the GOP would like to say that their tax cut plan will create jobs, the actual numbers prove this to be false because, over the ten years those cuts have already been in place, we have consistently lost jobs. Therefore, it is time that the GOP put our tax money where their promises are by supporting a plan that still gives tax cuts to ANY business that is willing to put people back to work, but this time requiring them to actually create and fill those jobs, and retain those workers for at least a year, before they are able to claim the reward.

If they do that, in the end, everyone wins. The unemployment numbers go down, the economy grows and strengthens, the businesses get loyal employees who are grateful to have a job again, and the government gains increased tax revenue for years to come that will offset a large portion of the cost of this plan.

Introduction

Welcome to the HIRE, TRAIN & RETAIN Act blog. My name is Maureen Mower. I'm a 99er - one of the long-term unemployed who has run out of all unemployment benefits but still cannot find a job. I am also the author of the HIRE, TRAIN & RETAIN Act.

The HTR Act is a proposal that I came up with after becoming furious over the proposed deal between President Obama and the GOP leadership that would extend the Bush tax cuts for another two years, but does nothing to address job creation or help the 99ers. It occurred to me that since I had to prove every week that I had actively sought employment in order to "earn" my unemployment checks, then those benefitting from these tax cuts ought to start proving that they are using this "handout" (as some like to call unemployment benefits) to actually create jobs and grow our economy.

As it stands now, the cuts have been in place for 10 years, but the jobs have disappeared consistently over that same period. Yet the GOP still claims that cutting taxes on the richest 2% of Americans will create jobs. So I say it's time we force them to prove that by targeting the tax breaks ONLY to those who actually create jobs.

I hope you will read my proposal and comment on it. More importantly, copy it and send it off to your elected represntatives, and do it NOW. We have very little time to get this into consideration before it's too late, not only for the 99ers, but for the entire country.

The next post will contain the entire proposal.