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Displaced IT workers stand to lose federal help

Patrick Thibodeau | Jan. 6, 2011
Expansion of Trade Adjustment Assistance program to include service workers expires Feb. 12

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.

About 85% of American workers are in the services sectors "so denying them the assistance they need, especially during this grueling jobs crisis, is a morally bankrupt position," Hira said. "IT workers are even more concentrated in the services sector. The fact that the extension of TAA benefits for services workers is not permanent, given the current state of offshoring of a wide variety of services jobs, is a perfect indication of just how disingenuous the offshoring cheerleaders are and how little influence that American workers have over policymaking."

 

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