Displaced IT workers stand to lose federal help

Expansion of Trade Adjustment Assistance program to include service workers expires Feb. 12

By , Computerworld |  Career, career, outsourcing

"There's a consensus from all observers that trade and offshoring displaces American workers," said Ron Hira, an associate professor of public policy at the Rochester Institute of Technology. "Every standard economics textbook explains this fact of trade. Given the meteoric rise of services trade and outsourcing, there is simply no defensible reason why TAA should be limited to workers who make physical products."

Under the expansion approved in 2009, TAA provides a number of financial benefits, including help for college; up to $1,500 in job search allowances; a relocation lump sum payment of up to $1,500; and a tax credit covering 80% of eligible health insurance premiums. Older works above age 50 who obtain new full-time employment at wages of less than $50,000, can receive a wage subsidy of 50% of the difference between the old and new wages up to $10,000 over a period of two years.

If service workers are again excluded, IT workers could launch new challenges over the program's fairness -- but they may face a difficult task. Workers who are laid off need the cooperation of the former employer to get benefits, and if the government rejects the initial application a lengthy review process may ensue.

In late 2003, for instance, laid-off BMC Software Inc. employees sought TAA benefits that were initially denied . Federal officials said "a software product must be tangible, fungible, and widely marketed. " But after finding that BMC had mass replicated software on CDs, the government said it was an "article" under the law. It took the government a year to consider this case.

In 2006, Computer Science Corp. workers were also denied TAA benefits, but the government later relented after deciding that software "if embodied in a physical medium" is an article under the law.

The fate of the TAA expansion in Congress is uncertain. In its final actions last year, Congress might have rejected extending general unemployment benefits had it not been for a larger tax deal negotiated by President Obama and Republicans in Congress. A potential source of funding for expanded TAA benefits, the additional $2,000 H-1B fee applied to offshore companies, is being used to pay for border security and healthcare benefits for 9/11 rescue workers.


Originally published on Computerworld |  Click here to read the original story.
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