[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]
RENEWING THE PRESIDENT'S
FISCAL YEAR 2013 BUDGET PROPOSAL
FOR THE U.S. DEPARTMENT OF LABOR
=======================================================================
HEARING
before the
COMMITTEE ON EDUCATION
AND THE WORKFORCE
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED TWELFTH CONGRESS
SECOND SESSION
__________
HEARING HELD IN WASHINGTON, DC, MARCH 21, 2012
__________
Serial No. 112-55
__________
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COMMITTEE ON EDUCATION AND THE WORKFORCE
JOHN KLINE, Minnesota, Chairman
Thomas E. Petri, Wisconsin George Miller, California,
Howard P. ``Buck'' McKeon, Senior Democratic Member
California Dale E. Kildee, Michigan
Judy Biggert, Illinois Robert E. Andrews, New Jersey
Todd Russell Platts, Pennsylvania Robert C. ``Bobby'' Scott,
Joe Wilson, South Carolina Virginia
Virginia Foxx, North Carolina Lynn C. Woolsey, California
Bob Goodlatte, Virginia Ruben Hinojosa, Texas
Duncan Hunter, California Carolyn McCarthy, New York
David P. Roe, Tennessee John F. Tierney, Massachusetts
Glenn Thompson, Pennsylvania Dennis J. Kucinich, Ohio
Tim Walberg, Michigan Rush D. Holt, New Jersey
Scott DesJarlais, Tennessee Susan A. Davis, California
Richard L. Hanna, New York Raul M. Grijalva, Arizona
Todd Rokita, Indiana Timothy H. Bishop, New York
Larry Bucshon, Indiana David Loebsack, Iowa
Trey Gowdy, South Carolina Mazie K. Hirono, Hawaii
Lou Barletta, Pennsylvania Jason Altmire, Pennsylvania
Kristi L. Noem, South Dakota Marcia L. Fudge, Ohio
Martha Roby, Alabama
Joseph J. Heck, Nevada
Dennis A. Ross, Florida
Mike Kelly, Pennsylvania
Barrett Karr, Staff Director
Jody Calemine, Minority Staff Director
C O N T E N T S
----------
Page
Hearing held on March 21, 2012................................... 1
Statement of Members:
Kline, Hon. John, Chairman, Committee on Education and the
Workforce.................................................. 3
Prepared statement of.................................... 5
Miller, Hon. George, senior Democratic member, Committee on
Education and the Workforce................................ 6
Prepared statement of.................................... 8
Statement of Witnesses:
Solis, Hon. Hilda L., Secretary, U.S. Department of Labor.... 9
Prepared statement of.................................... 12
Additional Submissions:
Foxx, Hon. Virginia, a Representative in Congress from the
State of North Carolina, questions submitted for the record 68
Fudge, Hon. Marcia L., a Representative in Congress from the
State of Ohio, questions submitted for the record.......... 69
Chairman Kline, questions submitted for the record........... 67
McCarthy, Hon. Carolyn, a Representative in Congress from the
State of New York, letter, dated Dec. 19, 2011, from
Assistant Secretary Borzy.................................. 44
Mr. Miller, letter, dated Mar. 21, 2012, to Chairman Kline... 64
Roby, Hon. Martha, a Representative in Congress from the
State of Alabama, letter, dated Jan. 18, 2012, from
Assistant Secretary Borzy.................................. 66
Rokita, Hon. Todd, a Representative in Congress from the
State of Indiana, questions submitted for the record....... 68
Secretary Solis:
Bureau of Labor Statistics news release, Jan. 6, 2012,
Internet address to.................................... 65
Bureau of Labor Statistics news release, Feb. 3, 2012,
Internet address to.................................... 65
Bureau of Labor Statistics news release, Mar. 9, 2012,
Internet address to.................................... 65
Response to questions submitted for the record........... 70
Woolsey, Hon. Lynn, a Representative in Congress from the
State of California:
Bureau of Labor Statistics news release summary, Jan. 6,
2012................................................... 57
Questions submitted for the record....................... 69
RENEWING THE PRESIDENT'S
FISCAL YEAR 2013 BUDGET PROPOSAL
FOR THE U.S. DEPARTMENT OF LABOR
----------
Wednesday, March 21, 2012
U.S. House of Representatives
Committee on Education and the Workforce
Washington, DC
----------
The committee met, pursuant to call, at 10:05 a.m., in room
2175, Rayburn House Office Building, Hon. John Kline [chairman
of the committee] presiding.
Present: Representatives Kline, Petri, Biggert, Wilson,
Foxx, Goodlatte, Roe, Thompson, Walberg, DesJarlais, Hanna,
Bucshon, Gowdy, Noem, Roby, Heck, Kelly, Miller, Kildee,
Andrews, Woolsey, Hinojosa, McCarthy, Tierney, Kucinich, Holt,
Davis, Altmire and Fudge.
Staff present: Andrew Banducci, Professional Staff Member;
Katherine Bathgate, Press Assistant/New Media Coordinator;
James Bergeron, Director of Education and Human Services
Policy; Casey Buboltz, Coalitions and Member Services
Coordinator; Molly Conway, Professional Staff Member; Ed
Gilroy, Director of Workforce Policy; Benjamin Hoog,
Legislative Assistant; Barrett Karr, Staff Director; Ryan
Kearney, Legislative Assistant; Rosemary Lahasky, Professional
Staff Member; Donald McIntosh, Professional Staff Member; Brian
Newell, Deputy Communications Director; Krisann Pearce, General
Counsel; Molly McLaughlin Salmi, Deputy Director of Workforce
Policy; Todd Spangler, Senior Health Policy Advisor; Linda
Stevens, Chief Clerk/Assistant to the General Counsel; Alissa
Strawcutter, Deputy Clerk; Loren Sweatt, Senior Policy Advisor;
Joseph Wheeler, Professional Staff Member; Aaron Albright,
Minority Communications Director for Labor; Tylease Alli,
Minority Clerk; Jody Calemine, Minority Staff Director; John
D'Elia, Minority Staff Assistant; Waverly Gordon, Minority
Fellow, Labor; Brian Levin, Minority New Media Press Assistant;
Celine McNicholas, Minority Labor Counsel; Richard Miller,
Minority Senior Labor Policy Advisor; Megan O'Reilly, Minority
General Counsel; Julie Peller, Minority Deputy Staff Director;
Michele Varnhagen, Minority Chief Policy Advisor/Labor Policy
Director; and Michael Zola, Minority Senior Counsel.
Chairman Kline. A quorum being present, the committee will
come to order.
Good morning, Secretary Solis. Thank you very much for
being with us today to discuss the policies and priorities of
the Department of Labor.
Before we begin, I am saddened to recognize the passing of
our dear friend and colleague, Donald Payne. For 23 years--23
years--Donald served this nation and the people of New Jersey's
10th congressional district with intelligence, tact, and honor.
America's teachers, workers, students, and employers lost a
strong advocate earlier this month, and I know I speak for all
my colleagues on the committee when I say Donald will be deeply
missed. And I know that my friend and colleague, the ranking
Democrat on the committee, would like to express his thoughts,
and I yield to him.
Mr. Miller. Thank you very much, Mr. Chairman. It is with a
great, deep sense of sadness that we remember our friend and
colleague, Donald Payne. This is our first full committee
hearing since his passing earlier this month. His passing took
so many of us, his friends and colleagues, by surprise.
As we all know from serving with him on this committee, he
was an uncompromising voice for the disadvantaged, and for the
powerless, and the disenfranchised, and that is where he began
his work with the--with the YMCA's National Council, and when
he came to the Congress of the United States. I first met
Donald when I was speaking to the National YMCA and he
introduced himself to me and told me he thought in a short time
he would be joining me in the Congress of the United States. I
next ran into him and his brother in Latin America during the
troubles in El Salvador and Nicaragua, where again, he was
working on behalf of poor people in those communities.
Recently, over the last couple years, I have had a chance
to go to Africa with Congressman Payne. He served on that
subcommittee--chair in the Foreign Affairs Committee. And it is
just amazing, the people who knew his name in Africa--the
poorest people in the country and the presidents and the rulers
of different nations, and everybody in between. And he knew
more about Sudan and Darfur and the problems there, and in
Rwanda, where he accompanied President Clinton.
Just an amazing advocate on behalf of the disenfranchised,
and his passion on this committee for Head Start and early
childhood education, and Pell Grants, and expanding
opportunities is just his legend in the sense that he never
ever stopped working on behalf of those individuals in our
country. As our colleagues from New Jersey will tell you, he
had a magnificent remembrance ceremony--his funeral--and a
wonderful sendoff from the people of Newark and the people of
New Jersey, and so many from around the nation who came to
honor him.
And with that----
Chairman Kline. Mr. Andrews?
Mr. Andrews. Thank you, Mr. Chairman. Thank you for this
honor for our friend and colleague.
Thank you, Mr. Miller, as well.
And thank you for the way you honored him and his service
here when he was here with us by treating every member of the
committee with respect.
Madam Secretary, Donald would have been delighted to be
here with you this morning. He was proud that you served with
him and all of us on this committee. He knows of your passion
for the work that he shared, as well.
And I must tell you that I come to this hearing this
morning in a very melancholy sense knowing it is the first time
we are gathering without Donald's presence because we are
talking about things he cared so very much about. He was both
and mentor, and a teacher, and a friend to all of us on this
committee. We are profoundly saddened by his loss but inspired
by his life.
Mr. Chairman, we thank you for this remembrance to our
esteemed colleague.
Chairman Kline. Mr. Holt, did you wish to be recognized?
You are recognized.
Mr. Holt. I thank the chair.
There is more than--more to say about Don than we could say
in a week, but Representative Payne was true to the word
``representative,'' and beyond that he was a real leader. Mr.
Miller has talked about how he was--you know, he was one person
who would go from meeting a freedom fighter in a country to
meeting the president of that country against whom the freedom
fighter was fighting with enormous respect from all.
He never lost his smile, never lost his sense of humor, but
never lost his passion for truth and for justice, and
especially for the little guy.
I thank you for this recognition of our colleague.
Chairman Kline. I thank the gentleman.
Now, as I know Secretary Solis' time is limited here today,
I will move to the issue of the day. On February 13th President
Obama released his fourth budget proposal since taking office.
The Associated Press reported the fiscal year 2013 budget
blueprint, quote--``takes a pass on reining in government
growth'' and ``reprises a long roster of prior proposals,''
such as more stimulus spending and tax increases.
According to Politico, ``the bottom line is a fourth
straight year of $1 trillion-plus deficits.'' And USA Today
editorialized the ``Best test of a budget proposal these days
is whether it reins in the national debt,'' adding, ``The
election year budget of President Obama fails that test.''
I couldn't agree more. The reality of the president's
budget is disturbing. Among its flaws, it contains $47 trillion
in government spending over the next decade, $1.9 trillion in
tax hikes on families and job creators, and $11 trillion in new
debt piled on the backs of our children and grandchildren.
Now, these figures come from the House Budget Committee,
but in the interest of nonpartisanship I would also like to
note the Congressional Budget Office said the president's
budget will lead to a $977 billion deficit next year, breaking
the president's promise to cut the deficit in half by the end
of his first term. Additionally, CBO said this budget proposal
will bring a total of $6.4 trillion in deficit spending over
the next 10 years.
One year ago more than 150 of the nation's leading
economists called for immediate action to rein in federal
spending to support economic growth and private sector job
creation. It is clear that with this budget the administration
has again chosen to ignore the urgent plea for fiscal
responsibility. Regrettably, the president's budget is less of
a serious plan to help the economy back on track and more of a
political document.
As secretary of labor you are well aware of the
difficulties facing the nation's workers and employers. With
gas prices rising, consumer confidence falling, and job
creation largely flat, it is now more important than ever to
ensure the federal government is not standing in the way of
economic growth and job creation.
The modest improvement we have experienced in recent months
is a testament to the strength and enduring optimism of the
American people that as a nation we always overcome adversity.
However, a budget that simply doubles down on the failed
policies of the past is a disservice to the country and will
undermine the progress we have made. Working families cannot
prosper under the crushing weight of this much debt, and no
economy built to last can be constructed on massive tax
increases and explosive federal spending.
Quite frankly, the president's budget embraces the wrong
priorities and reflects a failure of leadership. The policies
and priorities for the Department of Labor present a clear
example of the flawed policies that are hurting job creation
and restricting our economic recovery.
The department's use of taxpayer dollars sends a strong
message to employers that they have an adversary in the federal
government, not an ally. For example, in policies government
workplace safety and wage and hour standards punitive
enforcement actions take precedent over efforts to help
employers understand and comply with the law.
The department is also advancing costly regulatory schemes
that are creating even more uncertainty for job creators, such
as crafting an injury and illness prevention plan that would
burden employers with more mandates but do little to improve
workplace safety. And while employers face more punitive
measures, union leaders continue to enjoy less transparency and
accountability over how they spend workers' dues.
Despite this misguided agenda, I remain committed to
finding common ground on real solutions that will help our
economy grow and create jobs. We have found areas of agreement
in the past, including expanding free trade and extending tax
relief. It is vital that we build on these past efforts.
One area in which I hope we can work together is reform of
our nation's job training system. I commend the president for
highlighting in his State of the Union address the confusing
maze of job training programs spread across the federal
government. However, in recent months and in the budget
proposal before us today the president has also called for new
job training programs which would further complicate the tangle
of existing programs.
To reconcile the president's statements with his policy
proposals Ms. Virginia Foxx and I sent a letter to you, Madam
Secretary, requesting additional information about the
president's plan, and while I appreciate the response you
provided I am afraid it still leaves important questions
unanswered.
Where is the plan to create one program for job seekers and
how does it fit into the president's call for more programs?
Your letter described two new initiatives as, quote--``short-
term investments.'' Well, how short-term will these investments
be and how do we ensure they don't add to the confusion already
facing workers?
These are just some of the important questions we are
interested in discussing with you today, Madam Secretary. We
share a commitment to ensuring America's workers, employers,
and entrepreneurs have every opportunity to prosper and I look
forward to learning how the manner in which you intend to spend
taxpayer resources will aid in this endeavor.
Before I recognize my distinguished colleague, George
Miller, I want to welcome back to the committee--if she is--
yes, indeed--my colleague from Ohio's 11th district,
Congresswoman Marcia Fudge.
We are glad to have you back. Welcome to the committee.
[Applause.]
And now I yield to Mr. Miller for his opening remarks.
[The statement of Chairman Kline follows:]
Prepared Statement of Hon. John Kline, Chairman,
Committee on Education and the Workforce
Good morning, Secretary Solis. Thank you for being with us today to
discuss the policies and priorities of the Department of Labor.
Before we begin, I am saddened to recognize the passing of our
friend and colleague, Donald Payne. For 23 years, Donald served his
nation and the people of New Jersey's10th congressional district with
intelligence, tact, and honor. America's teachers, workers, students,
and employers lost a strong advocate earlier this month, and I know I
speak for all my colleagues on the committee when I say Donald will be
deeply missed.
Now, as I know Secretary Solis' time is limited here today, I will
turn to the issue of the day. On February 13, President Obama released
his fourth budget proposal since taking office.
The Associated Press reported the fiscal year 2013 budget blueprint
``[takes] a pass on reining in government growth'' and ``reprises a
long roster of prior proposals,'' such as more stimulus spending and
tax increases.
According to Politico, ``the bottom line is a fourth straight year
of $1 trillion-plus deficits.'' And USA Today editorialized the ``best
test of a budget proposal these days is whether it reins in the
national debt,'' adding, ``The election-year budget of President Obama
* * * fails that test.''
I couldn't agree more. The reality of the president's budget is
disturbing. Among its flaws, it contains:
$47 trillion in government spending over the next decade;
$1.9 trillion in tax hikes on families and job creators;
and
$11 trillion in new debt piled on the backs of our
children and grandchildren.
These figures come from the House Budget Committee--but in the
interest of nonpartisanship, I'd also like to note the Congressional
Budget Office recently said the president's budget will lead to a $977
billion deficit next year--breaking the president's promise to cut the
deficit in half by the end of his first term. Additionally, CBO said
this budget proposal will bring a total of $6.4 trillion in deficit
spending over the next 10 years.
One year ago, more than 150 of the nation's leading economists
called for immediate action to rein in federal spending to support
economic growth and private-sector job creation. It is clear that with
this budget, the administration has again chosen to ignore the urgent
plea for fiscal responsibility. Regrettably, the president's budget is
less of a serious plan to help get the economy back on track than a
partisan, political document.
As Secretary of Labor, you are well aware of the difficulties
facing the nation's workers and employers. With gas prices rising,
consumer confidence falling, and job creation largely flat, it is now
more important than ever to ensure the federal government is not
standing in the way of economic growth and job creation.
The modest improvement we've experienced in recent months is a
testament to the strength and enduring optimism of the American people
that as a nation we always overcome adversity. However, a budget that
simply doubles down on the failed policies of the past is a disservice
to the country and will undermine the progress we have made. Working
families cannot prosper under the crushing weight of this much debt,
and no ``economy built to last'' can be constructed on massive tax
increases and explosive federal spending.
Quite frankly, the president's budget embraces the wrong priorities
and reflects a failure of leadership. The policies and priorities for
the Department of Labor, for example, present a clear example of the
flawed policies that are hurting job creation and restricting our
economic recovery.
The department's use of taxpayer dollars sends a strong message to
employers that they have an adversary in the federal government, not an
ally. For example, in policies governing workplace safety and wage and
hour standards, punitive enforcement actions take precedent over
efforts to help employers understand and comply with the law.
The department is also advancing costly regulatory schemes that are
creating even more uncertainty for job creators, such as crafting an
injury and illness prevention plan that would burden employers with
more mandates but do little to improve workplace safety. And while
employers face more punitive measures, union leaders continue to enjoy
less transparency and accountability over how they spend workers' dues.
Despite this misguided agenda, I remain committed to finding common
ground on real solutions that will help our economy grow and create
jobs. We have found areas of agreement in the past, including expanding
free trade and extending tax relief. It is vital that we build on these
past efforts.
One area in which I hope we can work together is reform of our
nation's job training system. I commend the president for highlighting
in his State of the Union address the confusing maze of job training
programs spread across the federal government. And while I appreciate
the response you provided to our request for additional information,
I'm afraid it still leaves important questions unanswered.
Where is the plan to create one program for job seekers and how
does it fit into the president's call for more programs? Your letter
described two new initiatives as ``short-term investments.''
How ``short-term'' will these investments be and how do we ensure
they don't add to the confusion already facing workers? These are
questions I hope we will explore later today and we look forward to
your testimony.
______
Mr. Miller. Thank you, Mr. Chairman, and thank you for
recognizing Congresswoman Marcia Fudge, who is rejoining the
committee. She first joined the committee in 2009 and made a
very strong mark on behalf of children's nutrition and
education, and generally, in children's health, where--she has
also doubled down on that effort with her service on the--on
the House Agriculture Committee and trying to--to make sure
that we can avoid these childhood diseases that are presenting
themselves to us because of the nutritional habits of--of many
of our children and families.
And so welcome so much back to the committee, Marcia. We
are happy to have you.
Secretary Solis joins us at a turning point for our
nation's workers and families. The Wall Street financial
scandals and the resulting 2008 global financial crises threw
our economy into a tailspin. The resulting recession was long
and deep and in January 2009, the month that President Obama
took office--the month President Obama took office--the economy
lost 839,000 jobs.
When Secretary Solis first appeared before the Education
and Labor Committee 2 years ago the unemployment rate stood at
10.6 percent. More than 8 million workers had been laid off and
millions more were rightfully concerned that they could be
next. This country was going through the worst economic
downturn since the Great Depression.
Fortunately, things have begun to turn around, and while
much work remains to be done the economy is beginning to heal
and we are in a much better place today than we were when
Secretary Solis first joined us in February of 2010. But this
wasn't a matter of luck. The crisis was turned around in large
part because of the actions taken by the Obama administration,
the previous Congress, and the Federal Reserve.
Economists across the ideological spectrum agree that bold
action laid the groundwork for the economic recovery. By
working together for the good of the economy we stopped the
hemorrhaging and laid the tracks for a return to economic
growth.
The facts are indisputable. Today the unemployment rate is
dropped to 8.3 percent. There have been 24 straight months of
private sector job growth and 3.9 million new jobs have been
created. In fact, private sector job growth is at its fastest
rate since early 2006, back when the housing bubble was driving
the economy.
Over the last 2 years the economy added 429,000
manufacturing jobs after years of sector decline, and the
American automobile industry and its extensive network of
suppliers throughout the country have been rescued along with
millions of good, middle class jobs. Small Business Optimism
Index has seen 6 consecutive months of gains in confidence as
the recovery builds, and the markets are up nearly 27 percent
since Secretary Solis' first appearance.
While we are headed in the right direction there is no
question that more work remains to be done if we are to fully
rebuild our middle class economy and reignite the American
dream. And Secretary Solis has been in the forefront of these
efforts.
By statute, the mission of the Department of Labor is to
foster, promote, and develop the welfare of wage-earners in the
United States, to improve their working conditions, and to
advance their opportunities for profitable employment. This
mission expresses an important American value. Not only do we
value hard work and entrepreneurial spirit, our nation also
values a job that is safe. It values the careers that treat
workers fairly and compensate them according to the law.
Upholding these values creates more jobs and more business
opportunities.
Another piece of the agency's mission is to advance the
opportunities for profitable employment, and central to this is
the millions of workers and local businesses who utilize the
Workforce Investment Act employment and training services each
year. A modern workforce investment system must rise to meet
the needs of the country's labor market and create
opportunities for Americans to step into the middle class.
Now is not the time to gut its mission, as some are
proposing, but the fact remains that the current system needs
improvement. It needs to better align education and training
programs so that workers have the skills for the in-demand
careers.
It does no good to provide training to jobs that don't
exist. That is why Congressman Tierney and Congressman Hinojosa
and I introduced a bill yesterday to modernize the workforce
investment programs.
It will do this by encouraging the innovative programs that
connect workers with in-demand industries, streamlining access
to important services, and increasing the accountability for
those services. WIA must be doing more to encourage the private
sector partnerships and connect employers and labor unions,
community colleges, workforce boards, local governments to meet
the local workforce needs.
I join you, Mr. Chairman, in recognizing that this is
something that this committee can and should be working on
together right now. It would modernize and introduce real
accountability to a system of--a system in desperate need of
it.
In the process, it will help give millions of Americans the
opportunity to climb into the middle class. A bipartisan panel
of governors delivered that exact message when they testified
before the committee earlier this year. They asked us to put
aside those issues that divide us and work together where we
could find consensus, like reforming the Workforce Investment
Act.
It is my hope that we will heed their message, especially
during these times of crises for so many American workers and
employers, that Congress would be working together to benefit
all of them. The country deserves a Congress that solves its
problems and I look forward to working with you on the
reauthorization of WIA, and I want to thank Secretary Solis for
her appearance here today and look forward to her testimony.
[The statement of Mr. Miller follows:]
Prepared Statement of Hon. George Miller, Senior Democratic Member,
Committee on Education and the Workforce
Washington.--Secretary of Labor Hilda Solis testified today before
the House Education and the Workforce Committee emphasizing efforts
that she and the Obama administration are taking to improve employment
opportunities and ensure that all Americans can benefit from the
economic recovery.
``At stake is the very survival of the basic American promise that
if you work hard, you can do well enough to raise a family, own a home
and put enough away for retirement,'' said Sec. Solis. ``The best way
to continue moving our nation forward is to work with Congress in a
bipartisan manner to support meaningful policies that help our economy
grow.''
While the 2008 Wall Street financial scandals and subsequent
recession resulted in the worst economic crisis since the Great
Depression, the economy is headed in the right direction. There have
been 24 straight months of private sector job creation culminating in
3.9 million new jobs. Despite the good news, Democrats agreed with
Secretary Solis that more needs to be done and urged Congress and the
Obama administration to work together to continue to grow the economy.
``Economists from across the ideological spectrum agree: Bold
action laid the groundwork for the economic recovery. By working
together for the good of the economy, we stopped the hemorrhaging and
laid the tracks for a return to economic growth,'' said Rep. George
Miller (D-CA), the senior Democrat on the committee. ``While we are
headed in the right direction, more work remains to be done if we want
to fully rebuild our middle class economy and reignite the American
Dream.''
Miller and other members including Reps. Ruben Hinojosa and John
Tierney pointed out the need to work together to reform and modernize
the Workforce Investment Act in order to better align education and
training programs so that workers have the skills for in-demand
careers. Yesterday, the lawmakers introduced the Workforce Investment
Act of 2012 (H.R. 4227), legislation to strengthen the existing system
by streamlining and increasing access to training, promoting
innovation, and ensuring accountability and transparency.
``The Democratic bill develops a 21st century delivery system for
workforce training and adult education that leads to career pathways,
increased educational and workforce training opportunities and economic
self-sufficiency for our nation's workers,'' said Rep. Hinojosa.
Rather than modernizing the Workforce Investment Act to meet the
needs of workers and businesses looking for qualified employees today,
House Republicans are instead pushing forward on a budget proposal that
would cut back these important services.
______
Chairman Kline. Thank the gentleman.
Pursuant to committee rule 7(c) all committee members will
be permitted to submit written statements to be included in the
permanent hearing record. Without objection, the hearing record
will remain open for 14 days to allow statements, questions for
the record, and other extraneous material referenced during the
hearing to be submitted in the official hearing record.
It is now my pleasure to introduce our distinguished
witness. And again, this is one of those cases where she
probably needs no introduction, but let me just briefly say
that--remind my colleagues that the Honorable Hilda Solis was
confirmed as secretary of labor on February 24, 2009. Boy, that
was very quickly done.
Prior to her confirmation, Secretary Solis served as a
member of Congress, representing the 32nd district in
California from 2001 to 2009, and many on this committee had a
chance to serve with her not only in Congress but on this
committee. She graduated from California State Polytechnic
University and earned a master of public administration from
the University of Southern California.
It is really nice to have you back. My script here now
tells me I am supposed to explain our lighting system. I don't
think I am going to need to do that. It hasn't changed in many
years. It is still green, yellow, red.
Secretary Solis. All right.
Chairman Kline. And with that, Madam Secretary, you are
recognized.
STATEMENT OF HON. HILDA L. SOLIS, SECRETARY,
U.S. DEPARTMENT OF LABOR
Secretary Solis. Thank you very much, Chairman Kline. It is
a pleasure to be here with you and my colleagues.
And to Ranking Member Miller and members of the committee,
I want to thank you for inviting me here this morning to
testify to you about what we are doing at the Department of
Labor. It is always a pleasure to come back and see so many
friends and colleagues.
But I want to take also a moment to pay tribute to a dear
friend, also, and colleague and member of this committee, and
that was the fabulous Congressman Donald Payne, somebody that I
got to know sitting there with you on the dais talking about
issues relating to workers, and children, and disadvantaged
communities. He indeed was a true champion for working people
and did so much to improve our nation's workforce.
I think the last time I had the chance to really see him
and work with him was at an Aspen Institute retreat that I
attended with him in Cancun before the hurricane, and I
remember our conversations and I believe some of the committee
members were also in attendance. But just to hear his passion
and his commitment to people around the world and the struggles
that people were suffering and how important that was and
bringing it home here to this committee and how we could help
make efforts change working through bipartisan support.
So I say that I would hope that we could move forward in
his memory working together on bipartisan direction and matters
that will help to improve our nation and hopefully correct
those many things in the world that he saw that needed
improvement that I think all of us can agree on. So I thank you
for the opportunity to say that.
Since I last came here and testified before you more than a
year ago many economic indicators show we are moving on a path
to long-term economic recovery. Just 3 years ago we had upwards
of 10 percent unemployment and now it stands at 8.3 percent,
the lowest since the Recovery Act was passed. The African
American unemployment rate has dropped from over 16 percent to
14.1 percent; and the Latino unemployment rate, which was well
over 13 percent, to 10.7 percent.
In 2009 there were seven unemployed Americans for every job
opening. Today that ratio is under four-to-one.
However, you and I know we still have a lot more work to do
because we realize there are 12.8 million people that are still
looking for work; they remain unemployed. And 43 percent have
been out of work for longer than 6 months.
And I believe to create an economy that is built to last
President Obama has laid out a blueprint that emphasizes
strengthening American manufacturing, growing our energy
sector, and improving job training skills for our workers. To
do our part, the Department of Labor is supporting the
president's $8 billion Community College to Career Fund to
forge new partnerships between community colleges and local
entrepreneurs and integrate that in our workforce system.
Last September, as you know, we awarded $500 million in the
Trade Adjustment Assistance community college and career
training grant program. And just last month I had the privilege
to be joined with Vice President Biden and Dr. Jill Biden to
announce a second round of $500 million for these grants.
My department's Green Jobs Training Grants are preparing
workers for careers in renewable energy fields. These grants
have reached nearly 83,000 workers and more than 51,000 have
completed training. Of these, 87 percent have received a
credential such as a certificate or degree and 20,000 have
entered into new employment with 81 percent of them in green
training-related jobs. Keep in mind that many of them were
incumbent workers and were able to keep their jobs or move up
the ladder at their current job site.
We are also pushing ahead to modernize, streamline, and
reform our job training program. We have proposed a universal
core set of services to help all displaced workers find new
jobs. We are establishing one program, one Web site, and one
place, and an American job center network that will unify the
workforce system and better connect job seekers with employers.
We are also supporting workers through our Center of Faith-
Based and Neighborhood Partnerships, who is working with job
clubs and career ministries across the country. The connections
formed here can help job seekers expand their professional
networks and get to other critical support.
I recently visited one of the largest job clubs close to
Washington, the McLean Bible Church Career Network Ministry, in
Vienna, Virginia. The group has many success stories and I
would like to say hello and welcome them--we have some of them
here in the Career Network Ministries who are here with us
today.
And, Chairman Kline, you may be interested to know that
just last month we hosted a job club symposium at the Temple
Israel synagogue in Minneapolis. One of the panels featured
Catherine Byers Breet, who leads the Easter Lutheran Church Job
Transition Support Group in Eagan. It is a model group that is
helping individuals get back to work and help those displaced
professionals and especially returning veterans.
And to assist our veterans we have launched a new Web site
called ``My Next Move for Veterans'' to help them discover jobs
where their skills can be translatable. I have also developed
the Veterans Gold Card, which allows post-9/11 veterans to get
6 months of intensive job counseling and personalized case
management services. This builds upon existing programs to help
veterans find work.
However, our role to support and train workers doesn't just
stop with adults. I recently joined President Obama to announce
our Summer Jobs-Plus Initiative. It is a call to action for
businesses, nonprofits, local mayors, and government entities
to put our young people to summer youth employment.
We have also secured commitments from more than 200,000
summer work opportunities. Our goal is to reach about 250,000.
This is all volunteer.
Also, the department Job Corps program, YouthBuild
programs, continue to provide work opportunities and training
for our most vulnerable youth. In fact, some of our local D.C.
YouthBuild participants are here in the audience.
We have also had many Job Corps success stories that I
would like to talk about, but one in particular I would like to
share that may be of particular interest to Congressman Kildee.
Last March Nate Ford graduated from our Flint Job Corps Center
in Michigan. He did great work through the center learning
carpentry skills.
After graduating from the Job Corps program Nate got an
internship as a youth construction supervisor with Habitat for
Humanity, where he taught other youth volunteers how to use
various tools of the trade and other construction basics. He
stayed in the position for 3 months and then was hired full
time to interview and instruct new members of the different
Habitat for Humanity products.
Nate happens to be here today and I also want to welcome
him and congratulate him for a job well done. So I want to
point that out. Thank you.
Another area where we continue to focus is helping
America's women earn equal pay for equal work, and as we
commemorate Women's History Month we are reminded that almost
50 years after the passage of Equal--the Equal Pay Act a
stubborn wage gap is consistent. Women earn, on the average,
about 80 cents on the dollar for men doing the same jobs. The
impacts are not only against women but also their entire
families; they rely upon their earnings and the gap is even
more pronounced when you talk about women of color.
DOL is partnering in President Obama's Equal Pay
Enforcement Task Force that is bringing agencies together to
address that pay gap. The department continues to protect the
rights of American workers and help level the playing field for
employers who do play by the rules.
The Occupational Safety and Health Administration and the
Mine Safety and Health Administration are on the front lines
protecting workers from workplace hazards and injuries. Almost
2 years ago the Upper Big Branch mining tragedy in West
Virginia claimed the lives of 29 miners.
Our investigation found that this terrible incident was a
result of intentional and systematic efforts to avoid
compliance with MSHA standards and regulations. We recently
completed our internal review of MSHA's actions at the Upper
Big Branch Mine prior to the explosion, and of course, we are
committed to continuing improvements at MSHA and to additional
corrective action because we know that workers should not have
to risk their lives for their livelihood.
OSHA is also on the forefront of our efforts to ensure
workplace safety. We understand that most employers want to do
the right thing but we know some insist on taking shortcuts.
That is why OSHA continues to aggressively enforce our health
and safety laws, and we will continue to support the employers
in your districts who do play by the rules and run safe
workplaces.
But we also remain committed to securing the incomes and
benefits of all workers. Our Employee Benefits Security
Administration, EBSA, protects the retirement security and
health benefits of workers and retirees and their families.
Recently EBSA finalized a rule improving the transparency of
401(k) fees to ensure that workers' hard earnings are not
eroded.
The work of the Wage and Hour Division is also critical to
working families and women. Last year we secured over $220
million in back wages for well over 275,000 workers, the
largest amount in the division's history. Wage and Hour has
also undertaken initiatives to protect flight crews and in-home
caregivers.
I believe that programs and policies of the Department of
Labor are making a difference in American lives. The economy is
improving and we are seeing broad employment gains. As our
recovery continues my department will continue our critical
work to give Americans the job training, skills, and
opportunities so that they can lead safe lives at work and also
be a part of the middle class.
Thank you again, Mr. Chairman, and members of the
committee, and I am happy to respond to your questions.
[The statement of Secretary Solis follows:]
Prepared Statement of Hon. Hilda L. Solis, Secretary,
U.S. Department of Labor
Chairman Kline, Ranking Member Miller and Members of the Committee,
thank you for inviting me to testify about the work we are doing at the
Department of Labor (DOL). As always, it is a pleasure to be back among
my friends and former colleagues. This is now my third time testifying
before this committee. I think you have a good understanding of where I
come from and what our priorities are at the Department. However, I
always appreciate having the opportunity to update you on the
Department's work and receive feedback from the Members of the
committee so we can continue to work together to move America forward.
Since I was here over a year ago, much has changed and there are
many indications that we are on the path to long-term economic
recovery. It is useful to remind ourselves what a long way we have
come. Before President Obama took office, 4.4 million jobs had been
lost since the beginning of the recession. From the onset of the
recession in December 2007 until the Recovery Act passed, we were
losing an average of almost 370,000 per month; just under 820,000 jobs
alone were lost in the month before the Recovery Act was passed in
February 2009.
The national unemployment rate now stands at 8.3 percent, down from
its October 2009 peak and the lowest since the Recovery Act was passed.
Importantly, the recent drop in unemployment has been driven by
employment gains, not workers leaving the labor force. We have created
3.9 million jobs in the private sector over the last 24 consecutive
months.
America's labor market grew stronger in 2011. We created over 2
million private sector jobs, and the unemployment rate fell in 48
states. Additionally, the number of mass layoffs continued to decline,
with 12 of 19 industries reporting a decrease in new claims associated
with mass layoffs over the year. Now we are seeing sustained job growth
across almost every industry. Similarly, the number of people starting
new claims for unemployment benefits has been declining since last
September and has receded to March 2008 levels. In 2009, we saw seven
unemployed Americans for every job opening; that ratio is now under
four to one. This is due to a combination of more hiring and a decline
in layoffs.
There are other positive signs of our growing economic recovery. We
have seen ten straight quarters of GDP growth. Private investment grew
faster in 2011 than in the year before, and durable orders in the
manufacturing sector have been trending upward. Also, the housing
market is improving with building permits increasing sharply during the
last six months, while personal spending continued to grow above pre-
recession levels. We are creating jobs on a consistent basis, but we
will not be satisfied until everyone who wants a job can find one. We
know that 12.8 million Americans are unemployed and, of those, 43% of
them are long-term unemployed. We also know that the recession hit some
groups particularly hard and that the recovery has only recently
started to reach many of these groups.
The unemployment rate of African Americans peaked at 16.7% as
recently as August 2011, while the Hispanic unemployment rate peaked at
13.1% in November 2010. But over the past six months, as the national
unemployment rate has fallen, the African American unemployment rate
has dropped to 14.1% and the Hispanic unemployment rate to 10.7%.
Despite these improvements, the unemployment rate is still high, and
there is still much work that needs to be done.
To create an economy that is built to last, the President laid out
a blueprint for growth that emphasizes strengthening American
manufacturing, American energy, education, and skills training for
workers in a way that is consistent with American values. Now is a make
or break moment for the middle class and those trying to reach it. At
stake is the very survival of the basic American promise that if you
work hard, you can do well enough to raise a family, own a home, and
put enough away for retirement. The best way to continue moving our
nation forward is to work with Congress in a bipartisan manner to
support meaningful policies that help our economy grow.
This Administration strongly supported a bipartisan extension of
the payroll tax cut and emergency unemployment insurance benefits.
Unemployment insurance is a critical lifeline for those without a job.
Since the beginning of the recession and through the recovery, the
extension of unemployment benefits is estimated to have helped 17
million workers and this year's extension will help another 4.3 million
unemployed workers and an additional 8.1 million people living with
them. But the extension of unemployment benefits and payroll tax cuts
is not just the right thing to do for these families but also the smart
thing to do. We know that for every dollar put in the pockets of the
unemployed, about two dollars ripple through the economy, benefitting
all of us. For the typical family, the payroll tax cut means an extra
$40 in every paycheck.
These two programs make a huge difference in helping families meet
their daily responsibilities to feed and clothe their children, heat
their homes, and pay for gas and transportation costs. The bipartisan
extension legislation adopted several proposals that were included in
the President's American Jobs Act, such as providing greater
flexibility in the use of unemployment benefits to help the unemployed
get back to work, funding reemployment services, and giving states the
flexibility to use unemployment funds to help individuals establish
their own businesses.
In addition, this Administration has also stood with auto workers
and the communities whose economies depend on the industry. The
resurgence of the American automobile industry is seen in the fact that
we've added roughly 200,000 new auto-related jobs over the past two and
a half years. I am proud that the Department's Office of Recovery for
Auto Communities and Workers (ORACW) has played an important role in
coordinating the Federal response to help automotive communities and
workers whose lives have been disrupted.
Investing in a Competitive Workforce
The President has laid out proposals for ushering in a new era of
American manufacturing, with more good jobs created and more products
stamped ``Made in the USA.'' We are seeking new tools that help
American small businesses compete and lower tax rates for companies
that make products and create jobs in the United States. Our students
and workers must receive critical skills training so our workforce is
aligned with the increasingly technical needs of American
manufacturers. For these reasons, we are forging new partnerships
between community colleges, businesses and the public workforce system
to train and place skilled workers in high-wage, high-growth jobs.
Community colleges understand the needs of local employers. The
Administration's new $8 billion Community College to Career Fund, which
we would co-administer with our colleagues at the Department of
Education, will better enable our community colleges to partner with
industry and develop training programs for workers to enter high-growth
and high-demand industries that meet the needs of local employers. The
Fund will also allow federal agencies to partner with state and local
governments to help businesses that want to invest in America train the
local workforce that best meets their skill needs. We are helping
employers match what's taught in the classroom with their needs in an
office or on the factory floor. This program will also support
entrepreneurship training for workers and entrepreneurs. Altogether,
the Community College to Career Fund will train up to 2 million
American workers by 2015.
When I last came before you, we had just announced the grant
competition for the Trade Adjustment Assistance Community College and
Career Training (TAACCCT) program. Last September, we awarded $500
million to educational institutions that partnered with employers in
every state. Last month, I was excited to visit Roane State Community
College (RSCC) in Harriman, Tennessee, the recipient of a $2.86 million
TAACCCT grant. I am sure Congressman DesJarlais can attest to the good
work they are doing there. With this funding, RSCC is launching the
Advanced Materials Training and Education Center with the mission of
helping workers get back on their feet through training, and building
partnerships with a number of local industry and economic development
partners. Roane State also has partnered with Oak Ridge National
Laboratory in an effort to develop a low-cost, low-density carbon fiber
that can replace heavier steel used in airplanes, autos, and boats. The
workers enrolled at the Center are being trained for good-paying
advanced manufacturing jobs that can ultimately help reduce our
dependence on foreign oil.
RSCC was one of the many strong applications we received. Last
month, I joined Vice President Biden and Dr. Jill Biden at Davidson
County Community College in Thomasville, North Carolina, to announce a
solicitation for $500 million in TAACCCT grants for FY 2012. We plan to
make available $500 million in additional funding over each of the next
two Fiscal Years. This program will help advance our national goals to
have every American obtain at least one year of post-secondary
education and have the highest proportion of college graduates in the
world by 2020.
We need to further advance these new skills to match the new
challenges of our 21st century economy. In his State of the Union
address, President Obama drove home the point that it's unacceptable
that American companies have millions of unfilled job openings at a
time of high unemployment. We must do more to help job-seekers acquire
the skills to land jobs that already are open. Right now, there are
high-growth industries that cannot find skilled labor to fill open
positions, and we need to train our workers immediately to fill them.
One way we are addressing this challenge is through our H-1B
Technical Skills Training Grant Competition, which has awarded $342
million in grants to 79 public-private partnerships serving 31 states
and the District of Columbia over the last 9 months. These grants will
provide American workers with education, training and job placement
assistance in high-growth industries and occupations where employers
are currently using the H-1B nonimmigrant visa program to hire
temporary foreign workers to respond to workforce shortages. Industries
served by this program include advanced manufacturing, energy, health
care, and information technology.
I was happy to see Congress pass some key Administration priorities
in legislation extending the payroll tax cut, providing businesses tax
credits for hiring our veterans, extending unemployment insurance
benefits for the long-term unemployed, providing incentives for states
to run short-time compensation programs so employees can avoid being
laid off, and authorizing the use of emergency unemployment insurance
funds to help the long-term unemployed participate in self-employment
assistance programs. Additionally, the President's FY 2013 budget
proposes a $12.5 billion Pathways Back to Work Fund to provide
employment opportunities for low-income adults and youths and to make
it easier for the long-term unemployed and low-income workers to remain
connected to the workforce and gain new skills for long-term
employment.
The Department is also actively supporting policies and initiatives
that don't require congressional approval to ensure our economy
continues on the path to full recovery. We continue to develop new
partnerships with the public and private sector to leverage their
combined expertise. One such collaboration is our Social Jobs
Partnership with Facebook. We have teamed up with the social media
site, the National Association of State Workforce Agencies, the
DirectEmployers Association, and the National Association of Colleges
and Employers to provide employment resources to a large group of job
seekers who utilize social networking. This initiative is providing
immediate, meaningful and ready-to-use information for job seekers and
employers, and a modern platform to better connect them with career
opportunities.
I also understand the impact high energy prices have on middle
class families. This is why the President has made clear we need an
all-of-the-above approach to energy policy, one that makes strategic
investments in a clean energy future. The transition to a clean energy
economy will reduce our dependence on foreign energy while also
spawning a new industry of sustainable green jobs in the United States.
The President presented a vision for a new era in American energy
fueled by homegrown and alternative energy sources designed and
produced by American workers.
In June of last year we awarded $38 million through the Green Jobs
Innovation Fund to help existing training programs leverage additional
resources to build sustainable green career pathways. And through the
Recovery Act, the Department invested nearly $500 million in 189 green
job training programs to help train workers for careers in solar, wind,
biofuels, and other renewable energy sources available throughout the
United States.
These grants are helping train workers for the jobs of tomorrow and
retain employment today. Our Recovery Act green job training grants
have served and are still serving nearly 83,000 workers. Over 51,000
have completed training and of these, 87% have received a credential,
such as a certificate or degree. Despite tough economic times, almost
20,000 training completers have now entered new employment with 81% of
them in green training-related jobs. It is important to note that of
the 83,000 number, almost 39,000 were incumbent workers. We estimate
that at least 90% of these workers who received green jobs training
retained employment because of the skills upgrades they received, with
the remaining workers finding new positions. These were smart
investments that are preparing Americans for the clean energy jobs
driving our 21st century economy, and it is important to remember that
some of the programs will not be finished until 2013. These grants have
already helped thousands of people and they continue to help more
people every day. This is important because a report last year from the
Brookings Institution, in collaboration with the Battelle Technology
Partnership Practice, entitled Sizing the Clean Economy: A National and
Regional Green Jobs Assessment, estimated that 2.7 million Americans
are employed in positions related to the ``clean economy.'' And
although much smaller in size than traditional industry sectors, green
energy is growing rapidly: these sectors grew at a rate of 8.3% between
2003 and 2010--almost double the growth rate of the overall economy
during that time.
I am particularly proud of our partnership, led by our Center for
Faith-based and Neighborhood Partnerships, with job clubs and career
ministries across the country. While we do not provide any funding to
the job clubs, they are a valuable component of the workforce
investment system. The personal connections within a congregation or
community can help job seekers expand their professional networks and
get other support critical to employability. This support includes
emotional and even spiritual support through a process that--as anyone
who has had to search for a job can attest--can often be isolating and
emotionally draining. Employers that have worked with job clubs have
successfully met their hiring needs by building trust with job club
leaders and members. Through these strategic partnerships, job clubs
also offer a nice community complement to the workforce investment
system to serve more job seekers in an efficient manner.
I recently visited one of the largest job clubs in the country, the
McLean Bible Church Career Network Ministry in Vienna, Virginia. This
group draws between 100 and 250 people every Tuesday evening. They have
hundreds of success stories from the past two years, including Karen
McCann, who showed up at her office one day in December 2010 to learn
that her position was being terminated through no fault of her own. She
was out of work for nearly nine months. During this time, she attended
the ministry to learn how to become a better networker and how to more
effectively market her skills and experience. The camaraderie of the
group meetings helped her maintain a positive outlook during the job
search process. As a result, she landed a new management position with
a technology firm.
Chairman Kline, you may be interested to know that in your own
Congressional District there are a handful of job clubs hosted by local
churches that are providing invaluable support to job seekers--or as
the clubs like to call them, people in transition. Last month, we
hosted a Job Clubs Symposium at the Temple Israel Synagogue in
Minneapolis. One of the panels featured Catherine Byers Breet, who
leads the Easter Lutheran Church Job Transition Support Group in Eagan,
a model group that is helping a range of individuals get back into the
workforce, from dislocated professionals to returning veterans.
The Department also continues to use National Emergency Grants
(NEG) to help those communities that have been hit hard by disasters or
large layoffs. In 2011, the Department made available over $265 million
to 34 states and Puerto Rico. We all remember the devastating impact
Hurricane Irene had on the East Coast and Puerto Rico. To help with the
clean-up and recovery in these communities, we have made available over
$50 million in NEG funding to New Jersey, New York, North Carolina,
Pennsylvania, Puerto Rico, and Vermont. I know that there are Members
on this Committee whose districts were hit hard and you have my
commitment that the Department will continue to work with those
communities to provide all the assistance and support we can.
We also all remember the horrific images of the City of Joplin,
Missouri after it was hit by a tornado in May of last year. The
Department was one of the first agencies on the ground to help the
affected families. To date, we have provided almost $20 million in NEG
funds to help dislocated workers and support clean-up and humanitarian
efforts. Our Occupational Safety and Health Administration (OSHA)
personnel were also on the ground to provide vital health and safety
advice and guidance to responders. I am proud of the assistance the
Department of Labor provided as part of the larger effort to help
Joplin rebuild.
Also last year, communities in Illinois, Missouri, Kentucky, and
Tennessee felt the impact of storms that spawned several tornadoes.
Once again, the Department used nearly $30 million in NEG funds to help
families in many of these states. Finally, I hope committee Members
from Tennessee are aware of the support the Department is giving to the
workers and families affected by the closure of the Goodyear Tire and
Rubber Company in Union City. DOL has made available nearly $3.5
million in NEG funds to help nearly 850 job seekers to search for new
employment.
Modernizing the Workforce System
The Department believes we can provide a ladder to higher-paying
careers for more Americans with the reauthorization of the Workforce
Investment Act (WIA). WIA reauthorization presents a unique opportunity
to promote innovation in the public workforce system, build on its
strengths, and address its challenges. Through the reauthorization
process, the public workforce system can be positioned to help even
more workers gain a foothold in the middle class by ensuring they have
skills to succeed. It also can assist more American businesses by
giving them the highly qualified human capital that will help them
succeed in the 21st century global economy. WIA has helped many
individuals find work during one of our country's most challenging
economic times. During Program Year (PY) 2009 and PY 2010, 1.57 million
WIA assisted adults and dislocated workers entered employment. In PY
2010, nearly 70% of individuals receiving training services became
employed within one quarter after program completion and over 85%
retained employment in both the second and third quarters after program
completion.
In Congresswoman Foxx's home state of North Carolina, David Waugh
experienced the power of WIA programs in helping unemployed workers get
back on their feet. After many years in the construction industry,
David suddenly found himself unemployed. But through the Jobs Now
Program funded by WIA, David reinvented himself as a welder for a
machinery manufacturer. He received career counseling and a scholarship
through WIA-funded DavidsonWorks in Lexington to study welding and take
math and computer courses. When he graduated, David entered an on-the-
job training program where he sharpened his skills for his new career.
He was subsequently offered a full-time welding job with a local
machinery manufacturer and was promoted into a supervisory position
with the company. David said the training he received through the
program helped define his career path and gave him the skills necessary
to succeed.
I remain committed to working with this Committee and Congress to
support a bipartisan reauthorization proposal that includes the
streamlining of service delivery, one-stop shopping for high quality
services, engaging employers on a regional and sectoral level,
strengthening accountability, and promoting innovation. The workforce
proposals put forth by the President go hand in hand with these
principles, and I share the commitment to building a public workforce
system for the 21st century that is more efficient and responsive to
the challenges of this economy and the labor market. Reforming the
workforce system is an important goal, and the Administration seeks to
work with the Congress to achieve this goal.
The Department supports establishing ``one program, one website,
and one place'' for workers to receive employment support. We seek to
streamline, reform and modernize the way our job training system helps
laid off workers get training to transition to new careers. In this
increasingly global economy, it will be difficult to distinguish
between trade, technology, outsourcing, consumer trends and other
economic shifts that cause displacement. Therefore, as mentioned
earlier, the FY 2013 budget proposes a universal core set of services
to help all displaced workers, including workers who lost jobs in
trade-impacted industries, find new jobs. Under the President's
proposed Universal Displaced Worker program, up to a million workers a
year would receive high-quality job-search assistance, together with
access to critical skills training for high-growth and in-demand
industries or, for older workers, the option of wage insurance--a
significant improvement on the current system.
We also plan to launch a new website and a single phone number that
can be used by job seekers and employers to link to all available
employment and job training resources. The FY 2013 budget proposes to
strengthen One-Stop Career Centers and increase public awareness and
use of the public workforce system. This budget request reflects an
anticipated uptick in the use of the public workforce system by Post-9/
11 veterans returning home and seeking intensive services under the
Department of Labor's ``Gold Card'' initiative, which is discussed in
further detail below. For this reason, the President's proposal also
calls for the creation of an American Job Center Network to unify all
Federally-supported One-Stop Career Centers and electronic resources.
We seek to expand access to workforce services by partnering with
libraries and other entities to offer more convenient hours, and create
better online tools that offer personalized services that reach the
unemployed sooner and on a continuous basis. In addition, we propose to
extend online and personalized services to better serve employers
through our American Job Center Network.
We have also implemented a number of administrative reforms to
ensure that the workforce system is able to meet the needs of job
seekers and businesses during this economic recovery. These include
increasing innovation in workforce service delivery; improving
reemployment strategies; strengthening connections between unemployment
insurance and the workforce system; promoting industry recognized
credential attainment; and making labor market and credential
information more accessible to job seekers and employers.
Supporting Our Youth
Our role to support, train, and prepare workers doesn't stop with
adults. Our national youth unemployment rate currently stands at 16.5
percent for youth ages 16 to 24. That number is better than the April
2010 peak of 19.6 percent, but it's still unacceptably high. Youth
summer unemployment has almost doubled since before the recession. Last
July, the youth unemployment rate stood at 17.4 percent compared with
10.5 percent in the summer (July) of 2007.
Minority youth have had an especially difficult time finding summer
employment. Last July, the unemployment rate for African American youth
was 31 percent and 20.1 percent for Latino youth. Job opportunities are
not only important for the youth themselves; in these tough economic
times, many young people share their earnings with their families to
help them make ends meet.
It is more important than ever that our youth have opportunities
that prepare them for the future and that encourage their growth and
enrichment. That is why we announced President Obama's Summer Jobs Plus
initiative, a call to action for American businesses, nonprofits and
government entities to put our young people to work this summer. I've
heard from countless employers about the value they have found in
hiring young summer workers. These opportunities create lasting
personal connections that build loyalty and add value to a company.
They help companies build a pipeline of highly qualified local talent--
something critical to building strong communities.
In 2009 and 2010, the Recovery Act helped around 368,000 young
people to find summer work opportunities. Unfortunately, we have not
had additional funding to fully continue this effort. In 2011, I
traveled to communities across the country and challenged employers to
make a commitment to summer jobs. A number of major corporations,
nonprofits, local governments and others signed on and together we
opened up 80,000 summer job opportunities for America's youth.
We are building on this momentum in 2012. We have already secured
commitments for more than 180,000 positions and our goal is to reach
250,000 work opportunities before the beginning of summer. To help meet
that goal, we will soon be launching a Summer Jobs Plus Bank, a one-
stop online search tool being built with help from Google,
AfterCollege, LinkedIn, and Internships.com. These efforts will allow
young people to access opportunities in their local communities.
Our Job Corps program does just that by helping prepare
disadvantaged youth for a brighter future. For PY 2010, the last full
time period for which we have complete data, 84% of graduates entered
employment, the military or enrolled in post-secondary educational
training. More than 20,000 students earned a high school diploma or GED
and more than 33,000 completed their career technical training and
received a Career Technical Training certificate. Since July 2010, Job
Corps has opened three new centers in Pinellas, Florida, Milwaukee,
Wisconsin, and Ottumwa, Iowa. These centers are already up and running
and making a huge difference in the lives of our youth.
As you know, Job Corps also is focused on training and preparing
our youth for the jobs of tomorrow. Our new green training programs
have resulted in over 29,000 ``green graduates'' since PY 2009 in
fields such as electronic health records, overhead linesman training,
weatherization, solar, and smart grid technology. Job Corps also has
developed an interim credentialing program with the Office of
Apprenticeship designed to provide apprenticeship opportunities to
graduates.
We have many Job Corps success stories, but I'd like to share one
that may be of interest to Congressman Kildee. In March of last year,
Nate Ford graduated from our Flint/Genesee Job Corps Center in
Michigan, working through the center's carpentry training area. Through
the Work-Based Learning program, Nate worked with a local insulation
company, Retrofoam, where he applied his training skills on a daily
basis. After graduating from Job Corps, Nate got an internship through
AmeriCorps as a youth construction supervisor with Habitat for
Humanity. His responsibilities included teaching the youth volunteers
about construction basics. He stayed in this position for about 3
months and because his work was exceptional, he was hired full time. He
now interviews and instructs new members for different Habitat for
Humanity projects.
Our 2013 Budget also proposes reforms to improve the Job Corps
program. While most centers meet program standards, some centers have
been persistently low-performing based on their educational and
employment outcomes, and have remained in the bottom cohort of center
performance rankings for many years. Especially in a constrained budget
environment, and given the resource intensiveness of the Job Corps
model, it is neither possible nor prudent to continue to invest in
centers that have historically not served students well. The
populations previously served by these Job Corps centers will be
eligible to attend higher-performing centers. Job Corps will also make
changes to its strategies and approaches based on the findings of
program evaluations, strengthen the performance measurement system, and
report center-level performance in a more transparent way.
I'd also like to briefly update you on our YouthBuild program.
Since 2007, 22,950 participants have been enrolled into the YouthBuild
program. Since this time, a total of 7,887 participants have been
placed into employment and 12,530 have received an industry-recognized
certificate, credential or high school diploma. We expect more positive
news as more youth finish their service in the YouthBuild program. We
are proud of the success of our youth programs in helping to turn
around the lives of youth who face difficult barriers to employment.
Honoring Our Veterans
We also are working hard to do the same for our nation's veterans.
We ask so much of our military personnel. They often put their careers
on hold, leave their loved ones behind and embark on dangerous missions
across the world to protect our daily freedoms.
Our returning service members deserve a hero's welcome and a chance
to utilize their unique skills to help rebuild our economy. By
promoting priority of service for veterans in the One-Stop Career
Center system, we ensure that veterans receive the training and
employment assistance they need to obtain good jobs. Our homeless
assistance programs help nearly 18,000 veterans in their efforts to
reintegrate into the workforce. We provide transition assistance to
144,000 service members and spouses as they move from the military into
civilian careers.
The Department of Labor has launched a number of new initiatives in
the past year to assist veterans return to the civilian workforce. A
new website called My Next Move for Veterans allows our veterans to
enter their military occupation code and discover civilian jobs where
their skills translate. They can browse more than 900 career options.
We have also developed the veterans' ``Gold Card,'' which gives Post-9/
11 veterans increased access to six months of intensive job counseling
and personalized case management services at one of the approximately
3,000 One-Stop Career Center locations across the country. These
services include career assessments, direct referrals to open jobs,
interview coaching, resume assistance, and training referrals.
Many veterans have already downloaded the Gold Card since its
creation last November, increasing the number and quality of services
to veterans over and above the 1.8 million served through the workforce
system in PY 2010. Additionally, our Veterans' Employment and Training
Service (VETS) has embarked on a number of partnerships to connect
veterans with jobs and training. Our partners include the U.S. Chamber
of Commerce and the Departments of Defense and Veterans Affairs. We
will continue to work with our partners at the federal level and in the
private sector to increase employment opportunities for our brave
service men and women and their families.
What makes me proud are stories like that of Navy Veteran Glen
Williams of Illinois, who has a passion for helping his fellow veterans
and especially those like himself, who have a disability. But when he
found himself out of work, Glen turned to VETS for assistance. After
researching the federal job hiring process and struggling to navigate
it, he wrote an email to VETS and asked for assistance to better
understand the process and his rights and benefits as a veteran.
VETS worked with Glen to refine his resume and showed him the
general protocol on replying to job leads. He received a Linked-In
message seeking someone who was familiar with the government, military
and human resources recruiting companies, leading him to a position as
a disability and military outreach community recruiter. He began the
job last year and now works to connect veterans and individuals with
disabilities to employment opportunities.
We also are strengthening our enforcement and affirmative action
initiatives for veterans. We continue to educate about and enforce the
provisions of the Uniformed Services Employment and Reemployment Rights
Act and VETS has engaged in an aggressive public outreach campaign,
aimed not only at our service men and women, but also at employers,
attorneys, and human resources professionals as well. Since the passage
of the Veterans' Benefits Improvement Act of 2008, which imposed a 90-
day deadline for USERRA case investigations and a 60-day deadline for
USERRA case referrals to DOJ or OSC, case processing times have
diminished. We attribute this to increased scrutiny on investigative
procedures, ensuring that case investigations are completed in a timely
manner. VETS' USERRA Quarterly Reports to Congress measure VETS'
compliance with the 90- and 60-day investigation and referral time
limits, and reflect that VETS continues to meet its deadlines.
Additionally, last summer we proposed updates to the Vietnam Era
Veterans Readjustment Assistance Act (VEVRAA) that would require
federal contractors and subcontractors to conduct more substantive
analyses of recruitment and placement actions taken under VEVRAA.
Through our Jobs for Veterans State Grants, last year DOL provided
services to nearly 589,000 veterans and 201,000 veterans found jobs.
The grants fund two types of veterans' employment specialist positions
in the states: (1) the Disabled Veterans' Outreach Program specialist,
who provide intensive services to those veterans most in need, and (2)
Local Veterans' Employment Representatives, who provide outreach to
employers and engage in advocacy efforts to increase employment
opportunities for veterans.
An important program aimed at assisting veterans as they transition
back into the workforce is the Transition Assistance Program (TAP),
which provides Employment Workshops and direct services for separating
service members, including members of the National Guard and Reserve.
In FY 2011, over 144,000 transitioning service members and spouses
attended a TAP employment workshop at one of 272 locations worldwide.
VETS has taken steps to provide demobilizing members of the guard and
reserve services in the event they are not located near any of the
locations where TAP is normally provided. Moreover, our State Directors
for Veterans' Employment and Training are part of the planning process
when units in their area demobilize. Supporting veterans and their
families is part of our larger effort at the Department of Labor to
provide equal opportunity for all workers. We also are in the process
of completely overhauling TAP for the first time in 19 years to help
veterans translate their military experience into full-time civilian
employment. The redesign is based on established best practices and
will create solutions for a successful transition from military to
civilian life. We are now in the midst of deploying the Workshop at
pilot sites across the services so that we can refine and finalize this
curriculum based on feedback and evaluation.
Progress has also been made in implementing Executive Order 13518,
``Employment of Veterans in the Federal Government,'' signed by
President Obama in November 2009. The Executive order created the
Veterans Employment Initiative with the goal of helping Federal
agencies identify qualified veterans, clarifying the hiring process for
veterans seeking employment with the Federal government, and helping
them adjust to the civilian work environment once they are hired.
Veterans were 28.3 percent of total new hires in the Federal Government
in FY 2011 based on preliminary data obtained by the U.S. Office of
Personnel Management, which is one of the Department's strategic
partners in implementing the initiative. This increase is approximately
4.3 percentage points over the FY 2009 total of 24.0 percent and
approximately 2.7 percentage points over the FY 2010 result of 25.6
percent.
Equal Opportunity for All Workers
As we observe Women's History Month, it is important to note that
the number of women in the military is growing rapidly. Women are now
20% of recruits, 14% of the current military population, and make up
18% of the National Guard and Reserves. But today, over 12 percent of
our Post-9/11 female veterans are unemployed. We can and must do
better. The Department of Labor is committed to making sure these women
have better access to jobs and job training to help them transition
back into the civilian workforce.
Too many women who once proudly wore our uniform now go to sleep in
our streets, under our bridges and in vacant homes. The Department is
addressing issues that lead to increasing rates of homelessness among
women veterans, shedding light on the challenges of homelessness, and
creating solutions that bring about positive change. That is why our
Women's Bureau hosted a series of ``Women-to-Women Stand Downs'' around
the country for female veterans. In local communities, service
providers and businesses came together to provide homeless female
veterans with a variety of free services that ranged from employment
counseling, job training, housing vouchers, mental health screening,
and child care. The Women's Bureau has also created a new online
publication entitled ``Trauma-Informed Care for Women Veterans
Experiencing Homelessness: A Guide for Service Providers.'' The guide
gives service providers--like social workers, mental health
practitioners and community organizations--the tools to assess the
specific traumas suffered by female veterans and make them conscious of
their unique experiences and needs.
Women's History Month also reminds us that almost 50 years after
passage of the Equal Pay Act, a stubborn wage gap continues to impact
women and their families who rely upon their earnings. On average,
women, who now comprise almost half of the workforce and work full-
time, still earn only about 80 cents for every dollar a man earns. The
gap is even larger for African American women who earn about 70 cents
and Hispanic women who earn about 60 cents for each dollar that white
males earn. Over a woman's lifetime, this wage gap adds up and grows
over time. By age 65, the cumulative gap in earnings can be hundreds of
thousands of dollars.
An America built to last is a nation where every man and woman is
paid equally for equal work. And while we continue to struggle to
achieve that fundamental promise, we are making steady progress in our
pursuit. President Obama created the National Equal Pay Task Force,
bringing together DOL and other Federal agencies to address this
problem in a more coordinated way. Since the Task Force was founded in
January 2010, through the end of 2011, DOL's Office of Federal Contract
Compliance Programs (OFCCP) has closed 41 compliance evaluations with
financial settlements remedying compensation discrimination on the
basis of gender and race, totaling $1,547,427 in back pay and salary
adjustments to 549 workers.
Multiple agencies within DOL are working hard to help women workers
and eliminate the wage gap. We are increasing our enforcement against
employers who discriminate, and leveling the playing field for those
who follow the law. We have launched a competition to develop a pay
equity software application that is intended to educate users about the
gender pay gap so that women have the information they need to
negotiate better with their employers and to help them identify cases
of discrimination. OFCCP is also considering a proposal to collect
compensation data with respect to gender, race and national origin from
federal contractors and subcontractors. We can't solve the problem of
pay inequity until we can see it, count it and put a dollar figure on
it.
The Women's Bureau has also been instrumental in this regard. They
are developing educational materials for both employers and working
women, including information to help employees identify potential wage
discrimination and resources to assist employers in complying with all
applicable equal pay laws. Recently, they also released a guide
entitled ``Why Green is Your Color: A Woman's Guide to a Sustainable
Career,'' which is designed to help women find and keep higher paying
jobs in the clean energy economy.
We are also working to create more opportunities for workplace
flexibility so that workers have more options to help care for their
families without being penalized. The labor force has changed
significantly during the last few decades, including an increase in the
number of working women. The demands of work and personal life,
including family care-giving and personal health or education, require
that employers adapt to the changing needs of its workers.
Policies that support the realities of work-life balance are
critical to workers and to our economy as a whole. Promoting work-life
balance, including flexible workplace polices, is one of the many ways
the Department of Labor will improve working conditions and promote
economic security for all working women.
As the economy begins to recover, we also must ensure it provides
opportunities to all Americans who want to work--including people with
disabilities. The Office of Disability Employment Policy (ODEP), which
celebrated its 10 year anniversary in December, continues to develop
and influence disability employment-related policies and practices. The
Office helps individuals with disabilities get the tools they need to
improve their employment outcomes and helps businesses find talented
workers with disabilities.
To assist small businesses--including those in minority
communities--access the talent of adults and youth with disabilities,
ODEP continues its Add Us In initiative. Through this initiative, ODEP
funds eight grantees across the nation to develop innovative models for
small business to increase disability hiring. The Disability Employment
Initiative (DEI), a joint initiative between ODEP and the Employment
and Training Administration (ETA), supports the public workforce system
in providing effective integrated employment services to people with
disabilities. Funding for this program started in 2010 and last year we
provided over $21 million to seven states for the DEI.
Finally, ODEP continues to partner with the Department's Office of
Workers' Compensation Programs (OWCP) to help federal workers who are
injured or become disabled on the job return to productive employment.
Both agencies will continue to support the Protecting Our Workers and
Ensuring Reemployment (POWER) Initiative by conducting research to
document best practices that get folks back to work safely and as soon
as is possible. These efforts on behalf of the disability community are
critical--for workers and employers--and we are proud to be making
them.
Protecting American Workers
Equally important are the efforts we are making to protect American
workers. We know that workers need protection more than ever during
difficult economic times. It is in these periods--when workers fear
losing their jobs--that they may be more reluctant to complain about
unsafe conditions.
Our worker safety and health agencies--the Occupational Safety and
Health Administration (OSHA) and the Mine Safety and Health
Administration (MSHA)--are on the front lines protecting workers from
workplace hazards. Since these agencies were created, we have made
significant progress in protecting workers. It is estimated that in
1970 around 14,000 workers were killed on the job compared with more
than 4,500 today. But 4,500 workplace deaths and over almost 4 million
serious injuries are still far too high. There is still much work to be
done.
Almost two years ago, the Upper Big Branch (UBB) disaster, the
worst coal mining disaster in 40 years, claimed 29 lives and injured
two miners. We pledged to do everything within our power to make sure
such a tragedy would never happen again. This deadly explosion shook
the foundation of mine safety and caused us all to take a deeper look
at the weaknesses in the safety net expected to protect the nation's
miners. Our investigation found that this terrible incident was, in
fact, preventable. It was the result of intentional and systematic
efforts by Massey Energy to avoid compliance with MSHA safety and
health standards and regulations. Those 29 miners did not have to die.
We know that the dangers of mining are well documented. But we also
know that mining can be both safe and profitable, and the compliance
records of many mine operators are a testament to this fact. However,
too many mine operators still do not make safety their number one
priority, and we need the tools to promptly address mines that
disregard the law and put miners in harm's way.
We recently completed our internal review of MSHA's actions at the
Upper Big Branch mine prior to the explosion. At the time of the
accident, I personally committed to performing the most thorough review
ever, and I believe that we did that. The internal review team made a
number of recommendations, which we are committed to implementing, for
improvements in MSHA's enforcement policies and procedures, training
programs, and regulations. Immediately after the tragic accident,
Assistant Secretary Main had begun implementation of a number of
program improvements at MSHA to make the most of the tools we already
have to strengthen miner safety and health.
In April 2010, MSHA began conducting impact inspections across the
country, focusing on mines with poor compliance histories or particular
compliance concerns. To date, we have conducted more than 400 impact
inspections, yielding over 7,000 citations, many for obvious violations
of basic and necessary safety standards. As a result, some mine
operators have worked to clean up their practices. Unfortunately, some
mine operators still choose to blatantly disregard the law. Last
December, for example, on an impact inspection at a mine in Kentucky,
MSHA issued an imminent danger order when an inspector observed a coal
pile 5 feet high and 10 feet wide on fire, just feet away from an
unsecured explosives storage magazine.
Impact inspections alone are not enough to sufficiently address the
worst offenders. A number of mine operators seem to believe that
citations and the associated fines are simply part of the cost of doing
business. In October 2010, MSHA began using new screening criteria for
the pattern of violations program to more accurately identify mines
with chronic and persistent health and safety violations. Those mines
that chronically fail to maintain safe working conditions can be
subject to additional sanctions through the pattern of violations
process. MSHA has worked to make this process transparent and created
an online tool that enables mine operators, miners, the media, and the
public to see how a specific mine matches up with the criteria for a
potential pattern of violations. To further enhance the use of its
available tools, MSHA recently announced a reorganization that will
allow it to better manage, support, and coordinate special enforcement
actions.
MSHA recently began the third phase of its ``Rules to Live By''
initiative, using this opportunity to educate miners and mine operators
about the most common causes of mining deaths. Some of these problems
cannot be addressed without solving the backlog of cases before the
Federal Mine Safety and Health Review Commission. Together, the
Commission, the Office of the Solicitor and MSHA have been working at
reducing the backlog of contested violations. I appreciate the support
Congress has shown for these efforts and we will continue to work
tirelessly to not just address the current backlog, but to also prevent
future backlogs of cases before the Commission.
MSHA's work to protect our nation's miners is a combination of
inspections, enforcement, education and improved regulations. Recently,
we finalized a rock dust rule that will help prevent coal mine dust
explosions. This rule responds to one of the many lessons we have
learned in the past two years.
Our efforts are beginning to have an impact. In 2011, we saw the
second-lowest numbers of mining deaths since statistics were first
recorded in 1911. This was accomplished while employment in the mining
sector increased. Several of the larger coal producing states
experienced zero mine fatalities in 2011. But 37 fatalities is still 37
too many.
I believe that more can be done to protect workers in our nation's
mines. They are the backbone of our economy. No worker should ever have
to sacrifice their life for their livelihood. And no family should ever
worry whether they will lose their loved one for a paycheck. In order
for MSHA personnel to effectively protect miners and prevent another
tragedy like Upper Big Branch, we need to be able to deal with the
small percentage of mine operators that believe miner injuries,
illnesses, and deaths are just part of the cost of doing business. They
absorb the ``cost'' of fines and temporary work stoppages and risk
their workers' lives. Thus, I urge you to pass legislation that would
provide MSHA with stronger enforcement tools to ensure mine operators
meet their responsibility to protect their workers.
We all agree that good jobs should also be safe jobs. OSHA works
hard to ensure employers have the knowledge and tools to live up to
their responsibility to ensure safe workplaces for their employees. We
have seen the results of our hard work. In FY 2011, OSHA set a goal of
removing 475,000 workers from hazards--and exceeded it by 20 percent,
actually removing over 625,000 workers from hazards through
inspections.
However, OSHA only has the ability to reach a small number of
workplaces each year. Therefore, the best way to promote safe and
healthy workplaces is to ensure that workers can raise concerns to
their employers--or to OSHA--about unsafe working conditions without
fear of reprisal.
In addition to protecting worker's health and safety rights, the
agency has also been given responsibility to administer 20 other
whistleblower laws that protect employees. For that reason, over the
past year, we have made the improvement in our whistleblower program a
top priority.
Responding to recommendations from the Government Accountability
Office, DOL's Inspector General and OSHA's own internal study, we have
improved training for the investigators, restructured the office to
raise its priority within the agency, implemented pilot projects to
increase consistency and improve customer service, improved the
investigation tracking system, and published a Whistleblower
Investigations Manual that provides further guidance and helps ensure
consistency and high-quality investigations. The agency has recently
hired 25 new investigators and will be further increasing the staff as
a result of the increase the program received in the FY 2012 budget.
It is also our duty to help both workers and employers know their
rights and responsibilities. We are continuing our active compliance
assistance program so that all workers understand the hazards they face
and their rights under the law. We are providing that same kind of
compliance assistance and education to employers, ensuring they have
access to important information and that they understand how to comply
with the law.
Additionally, even amidst tough economic times, we are protecting
increased levels of funding for our free small business consultation
program. This program provides funding to every state so that small
employers can call for a free onsite consultation visit without risk of
receiving citations. This program provided services to almost 28,000
small businesses during FY 2011, removing over 3.6 million workers from
hazards.
Another way OSHA is promoting the culture of safety is by reaching
out directly to vulnerable workers. Last year, together with partners
around the country, we launched a campaign to educate workers and their
employers about the hazards of working outdoors in the heat, spreading
the simple message of ``water, rest, and shade'' in both English and
Spanish.
We also know that OSHA inspectors save lives directly. Last year,
OSHA's Rick Burns was performing a worksite inspection on a deep,
unprotected trench Mercerville, Ohio, when he detected conditions that
indicated collapse was imminent. He directed a worker to exit the
trench, less than five minutes before the trench collapsed, burying the
area where the worker had been with six to seven feet of soil. ``The
actions of the compliance officer likely saved this worker's life,''
said David Wilson, assistant area director in the Columbus area office.
OSHA has continued the process of streamlining and simplifying
regulations in order to reduce the burden on employers. Under the
Standards Improvement Project, OSHA reviews and eliminates outdated and
duplicative regulations. The latest rule issued under this project
saves employers $43 million annually and eliminates almost 2 million
annual hours of paperwork burdens. In addition, the modifications to
OSHA's current Hazard Communication rule that will allow it to
harmonize with the global system of labeling chemicals will be
published soon.
We understand that most employers want to do the right thing and
make their workplaces safe. But there are still some who insist on
taking shortcuts when it comes to safety. Americans were reminded of
that in January 2011 when OSHA cited two companies for the suffocation
deaths of three workers in a grain silo. Two of these workers were
teenagers--just 14 and 19 years old. These deaths could have been
prevented if the employer had followed the law. The American people
cannot tolerate such disregard for the lives and health of our
citizens. We will continue to aggressively enforce our safety and
health laws against those employers who choose shortcuts and profits
over people. And we will continue to work with the employers who play
by the rules and run safe workplaces. As we continue to advance our
progress on the issue of worker protection, we remain committed to
securing the incomes and benefits for all workers.
Securing Americans' Incomes and Benefits
The Department of Labor's Employee Benefits Security Administration
(EBSA) is continuing this important work to protect the security of
retirement and health benefits for America's workers, retirees, and
their families through a combination of compliance assistance,
regulations, and enforcement.
Recently, EBSA finalized a rule improving the transparency of
401(k) fees to ensure that workers' hard-earned savings are not
unwittingly being eroded by undisclosed fees. For the first time,
workers will be provided with a simple and comprehensible schedule of
what fees apply to what retirement investment options in a way that
allows for an easy apples-to-apples comparison. A related effort
enhances disclosures to fiduciaries responsible for sponsoring and
operating retirement plans about the fees they pay to plan service
providers. This will be especially useful to small businesses as they
review their 401(k) plans in helping them understand the relative costs
of the investment choices they offer their employees.
The agency is also working to enhance the protections that apply
when participants and beneficiaries, business owners, and retirement
savers in pension plans and IRAs receive advice regarding their
retirement investments. Today, more and more individuals are
responsible for making their own decisions about how to invest for
retirement. As a result, a growing number of individual brokers and
businesses are offering financial services, including advice as to what
retirement products and services to choose and where retirement assets
should be invested.
The financial professionals who offer advice for a fee should be
required to place the interests of those they are advising first and
avoid conflicts of interest. That's exactly what the law currently
provides. However, there are regulatory loopholes that advisers can use
to avoid accountability. This is what EBSA's effort to update its
fiduciary definition is all about--making sure that those who provide
investment advice on retirement savings do so in a way that is unbiased
and free from conflicts of interest.
In addition to these critical initiatives, EBSA has had tremendous
success in protecting employee benefits through both civil and criminal
enforcement actions. EBSA's enforcement and participant assistance
efforts achieved total monetary results in FY 2011 of more than $1.3
billion, and EBSA closed 302 criminal investigations. Additionally,
EBSA's criminal investigations, as well as its participation in
criminal investigations with other law enforcement agencies, led to the
indictment of more than 100 people.
In 2011, our Benefits Advisors, who provide assistance, and
education and outreach for workers, retirees, and their employers,
closed more than 230,000 inquiries, helping informally resolve the
complaints of 173,164 individuals and recovering over $478 million
through informal dispute resolution. We also conducted 1,831 outreach
activities reaching more than 155,000 individuals.
Recently in New York, a middle-aged woman with breast cancer had
her health claims denied because of mistakes made by her husband's
former employer and its insurance company. Michelle Khalife, a benefits
advisor with EBSA, discovered that the husband routinely had paid for
extended health coverage under COBRA. However, the employer's insurer
had failed to activate his coverage on time, causing his ill wife to
fall under a pre-existing condition exclusion. As the bills mounted,
the family approached Khalife for help. Khalife gathered all of the
parties in one meeting to hammer out the details, resulting in
reinstatement of the woman's coverage, and the insurance company paying
the family $42,000 in medical bills.
It can be easy to forget, but in the midst of tough economic times,
merely having a job is not always enough. Workers need good jobs that
pay fair wages, keep them safe, and provide basic benefits.
The work of the Wage and Hour Division (WHD) is critical to
achieving this goal. These investigators are committed not only to
informing workers of their rights, but also to informing employers of
their responsibilities in the workplace. Detecting and remedying labor
violations protects law-abiding employers from unfair competition
against those who flout the law and cut corners by paying workers less
than they are owed. This commitment on behalf of my staff is important
to the success of workers, and the businesses that employ them.
WHD has made great strides in ensuring that workers are respected
and that their rights are protected. The Division has also worked to
ensure that employers who break the law do not keep an unfair advantage
over the vast majority of employers who do play by the rules. Under my
leadership the Wage and Hour Division has secured impressive amounts of
back wages for workers across the country. This is important,
especially as our economy continues to recover.
In FY 2011, Wage and Hour investigators collected more than $220
million in back wages for American workers--the largest amount
collected in a single fiscal year in the Division's history. These back
wages were collected on behalf of more than 275,000 workers, including
nearly 90,000 who had not been paid the minimum wage for all of the
hours they had worked. This unprecedented back pay represents the
rightful return of hard earned wages to the pockets of America's
workers. Further, it means more direct spending on goods and services,
stimulating our economy and helping to create new jobs.
Much of this impact is felt at the local level. When an employer in
your district violates the Fair Labor Standards Act by not paying the
required minimum wage or overtime, that employer is taking money out of
the pockets of your constituents. Consider that WHD was able to recoup
over $45 million in back wages for over 40,000 workers in the state of
New York since 2009. In North Carolina, WHD's work on over 2,600 cases
resulted in nearly 23,000 workers receiving $18 million in back wages.
And, under this Administration's tenure, WHD has recouped nearly $600
million in back wages in over 85,000 cases--impacting more than 720,000
workers nationwide.
I want to make it clear that our work is about more than just the
numbers. It is driven by a passion for the people we seek to help every
single day. Because much our focus is on low wage and vulnerable
workers, the amount we collect per individual may seem small, but it
can--and does--make all the difference for that worker and his or her
family.
For example, a cable installer in Minnesota had been paid less than
minimum wage by his employer. This worker was facing foreclosure of his
home, but one of our investigations resulted in him receiving $3,000 in
back wages, allowing him to pay his mortgage and keep his home. And
after an investigation in South Dakota recouped $5,500 for a
construction worker, he and his wife were able to buy back the wedding
rings they had pawned in order to pay rent and avoid eviction.
Beyond the agency's enforcement efforts, WHD has undertaken a
number of important initiatives and rulemakings to protect workers and
employers. We have proposed a rule that would expand military family
leave provisions under the Family and Medical Leave Act (FMLA) and
incorporate a special eligibility provision that would ensure the
eligibility of flight crew employees. All interested parties are
invited to review and submit written comments on the proposed rule. We
also have a proposed rule under Fair Labor Standards Act (FLSA) that
would extend minimum wage and overtime protections to many of the
nearly two million in-home caregivers across America--protections that
are currently denied.
Protecting youth on the job and enforcement of our child labor laws
has always been a top priority of mine. After issuing a Final Rule in
2010 designed to protect youth employed in nonagricultural occupations,
the WHD began work on updating and revising the safety requirements for
young workers employed in agriculture.
The Department has engaged federal and state agencies in an effort
to end the practice of misclassifying employees as independent
contractors. Improperly classifying workers deprives those employees of
many of the rights and benefits they are legally entitled to, including
the minimum wage and overtime and makes it difficult for law-abiding
employers to compete. We have signed Memorandums of Understanding with
the Internal Revenue Service that will allow us to share information
with them about our enforcement efforts, and also with thirteen state
labor agencies, from Minnesota to Massachusetts and California to
Hawaii, that will allow us to share information and coordinate
misclassification enforcement. All of these efforts will help the
Department of Labor protect workers and level the playing field for the
vast majority of responsible employers who are playing by the rules.
Increasing Effectiveness and Accountability
To create an economy that is built to last, we have to do more to
live within our means and restore fiscal accountability and
responsibility. This means increasing the effectiveness of our current
programs and investing in innovation for the future. We are building
evaluation into everything we do, which helps ensure accountability and
efficiency. We have performance measures for every agency, which were
in many cases non-existent prior to my arrival. This tracking allows us
to know how each agency is performing against its goals and what we can
do to best allocate our resources.
We continue to invest in the Department's Chief Evaluation Office,
which is working to implement, manage and coordinate the Department's
evaluations. This investment provides the Department with valuable
intelligence about strategies and approaches that work for the benefit
of all America's workforce. Through this effort, we are supporting the
Administration's goal of building a transparent, high-performance
government.
Our Chief Evaluation Office is working jointly with our Chief
Economist's Office to create a centralized website on the evidence-
based best practices. Many evaluations exist that inform us about which
programs work, but the information is dispersed and does not always
reach policy makers and practitioners. Readily available information
will allow us all to make better-informed decisions.
Thanks to Congress's support, we have made available approximately
$98.5 million through the Workforce Innovation Fund to invest in
projects that demonstrate and evaluate innovative workforce investment
strategies, particularly to serve vulnerable populations. We look
forward to a new Workforce Innovation Fund competition in FY 2013. The
mission of the public workforce system is to find good jobs for
everyone. These grants will significantly enhance the capacity of our
public workforce system by identifying, evaluating and expanding
successful programs. In addition to providing technical assistance to
grantees throughout the life of the grants, the Department will share
program evaluation results and best practices with both grantees and
stakeholders in workforce, education, and human services systems.
We are also well underway into an evaluation of the WIA Adult and
Dislocated Worker programs. Previous, non-experimental studies show
that reemployment services and training provided through WIA increases
employment and earnings after participation in this program, especially
for adults. However, this random assignment evaluation will help us
ascertain the impact and cost-effectiveness of WIA programs for the
individuals we serve. The evaluation is beginning enrollment of
participants at selected sites and we expect final results in 2017 with
an interim report in 2016. Ultimately, this information will help us
minimize duplication and maximize efficiency. I know these are goals
upon which we can all agree and I sincerely hope we can work together
to make improvements where they are needed.
Conclusion
We are on the right track and we believe the programs and policies
of the Department of Labor are making a difference for American
families. The economy is improving and we are seeing broad employment
gains. But we cannot stop now. We must continue to innovate and build
upon what we know works, because we will not be satisfied until every
American who wants work can find a job. Creating an economy built to
last requires good jobs that pay well, fair and safe workplaces for our
workers, a level playing field for businesses, and help for American
workers to provide for their families and keep the pay and benefits
they earn.
The President has put forward proposals that invest in our country
and will help prepare Americans with the skills they need today, for
the jobs of tomorrow. Together, we can accomplish our goals for our
country by moving forward on these common sense measures that ensure
good jobs for American workers. We will not always agree on how we get
there, but we cannot delay action on important initiatives that will
keep our economy growing and our nation moving in the right direction.
Thank you again for inviting me today. I am happy to respond to any
questions that you may have.
______
Chairman Kline. Thank you, Madam Secretary.
We will go on the 5-minute clock now, my colleagues. I
announce that in a futile effort to--every time.
Madam Secretary, I appreciated you talking about the
importance of protecting the rights of workers, but picking up
where we were last year in your hearing, I would like to talk
for just a minute about the Office of Labor Management
Standards. As you know, Madam Secretary, it is the only federal
agency responsible for establishing safeguards for union
democracy and union financial integrity. You didn't mention it
in your written testimony or oral testimony--I missed it.
We have kibitzing going on up here. I am sorry.
The number of enforcement personnel at OLMS is now down to
its lowest level in 10 years. Since fiscal year 2008 OLMS's
staffing level has dropped by 27 percent. In fact, OLMS is the
only enforcement agency at DOL to decrease enforcement staff
under this administration.
Last year you explained OLMS's staffing decrease by
referring to OLMS as a, quote--``leaner, meaner machine,'' that
is capable of doing more with less. But this Office of Labor
Management Standards, under this administration, is actually
trying to do less.
The fiscal year 2013 goals, which they have set for
themselves, will have OLMS investigating fewer delinquent and
deficient financial integrity reports and conducting fewer
compliance audits than it did in the past. How do you explain
that?
Secretary Solis. Mr. Chairman, I did make that statement
the last time I was here because we also were looking at
changes in our budget, but I remain committed to fully
supporting the role of OLMS, and we know that historically they
have had a strong enforcement record. And if you look at our
figures from 2007 and 2010 and compare them to 2011 we have
actually done more work in terms of indictment, and also in
convictions and election investigations. We have fewer people
on the ground but we are being more strategic in our work.
And I would say that in the past, in fiscal year 2011 we
proposed an increase for OLMS. Not only did Congress not
approve the increase, but two cuts in the C.R. reduced funding
for the agency. So much of that occurred outside of my control.
But nevertheless, I do remain committed. We continue to
investigate where there are abuses that occur with collective
bargaining, and especially in the area of elections. I have to
tell you that that is probably one of the most exciting parts
of what I am seeing happening right now with OLMS, where we are
going in and actually investigating where there have been
corruption or typical, say, fraudulent activities occurring
when elections occur at particular union sites. And that is
something that we can be proud of and it is because we are
using the taxpayer dollars more effectively.
So I would say that overall, while you can see that our
budget has decreased our commitment to these investigations has
not deterred what our enforcement capabilities are. We are
trying to do the best we can.
Chairman Kline. I thank you for the answer and I appreciate
your attention to establishing safeguards for union democracy
and for elections. But union financial integrity is also
important, too. You are the organization that makes sure that
those dollars are being watched and safeguarded. There is
nobody else, really, that is doing that.
And we know that many, many union leaders are behaving
perfectly well, like many, many, and most employers are
behaving perfectly well, but not all of them do. And so it is
important that these workers--these union workers--have the
visibility and the transparency.
So I would appreciate your attention to that, and I can
assure you, of course, we will continue to watch that closely
because this is the only place where we have got that. And so I
am concerned when you have a decrease, and I am always for
leaner and meaner--leaner and meaner as we go forward in these
tough budgetary times. But it is really, really important, I
think, to those workers that somebody there is looking out for
them.
And then I have one more question--going to have to answer
it quickly. You addressed it, but I just--I am still confused
by the approach towards job training where you mention we are
trying to go to renaming, apparently----
Secretary Solis. Rebranding.
Chairman Kline [continuing]. Rebranding. I am not exactly
sure why that is necessary, but we are rebranding and trying to
refocus, and yet it seems to me like we are not really reducing
programs and we are spending a lot more money. I would like to
hope that we are making this effort simpler, and I am looking
forward to working with my colleagues here and, frankly, Madam
Secretary, with the department as we go forward in the WIA
reauthorization and looking at how we get out these 47, or 48,
or 49, or maybe it is 50 now, different job training programs
and try to make that more effective.
And I see my time has expired, and because I am going to
insist that others stay within the time I will now yield to Mr.
Miller.
Mr. Miller. I was going to ask unanimous consent that you
have an additional minute or whatever. [Laughter.]
Chairman Kline. I would object.
Mr. Miller. But you would object. I figured that you would
probably object, so----
Welcome, Madam Secretary, to the committee, and thank you
for your service on behalf of working men and women and their
families in our country. To follow up on the discussion here on
going forward on worker training programs and the
reauthorization of WIA, my--one of my district offices is right
next to our veterans service center and I spend a lot of time
talking with veterans as they come and visit that center, and
employment obviously continues to be a big problem with respect
to our returning veterans--and veterans more general,
especially those who are returning and transitioning back to
civilian life.
And concerns have been expressed by my local veteran
service agencies and--by Disabled American Veterans and the
American Legion on the questions of the consolidation that are
reflected in Ms. Foxx's bill. And again, we are trying to
streamline these programs and we are trying to consolidate them
in a manner that is rational, but we know that there are hard
to serve populations and that--we have disproportionate number
of people that are unemployed in those populations. And I just
wonder if you could speak to that so that we can continue to
focus the necessary resources and attention on our returning
vets.
Secretary Solis. Well, the whole issue of dealing with the
vets is very complicated because we are also dealing with
trying to provide service to a military that are still
enlisted, so we have a program that you are aware of called the
TAP program, the Transition Assistance Program. We are
revamping that; we are trying to make it more efficient so that
we can actually capture those individuals before they leave so
they understand where the one-stop centers are where case
management will be available. If they have issues--post-
traumatic stress--or if they are at risk of becoming homeless
because they may not secure employment, we want to provide them
readily--them and their families--with this kind of
information.
With the whole rebranding of our one-stops, our WIA
program, we want to make sure that everybody understands that
regardless of where you go city to city or state to state you
know what a one-stop center is supposed to do, and that is why
the president has urged us to rebrand and put a name on where
you can go and shop for a job, find assistance--counseling that
you might need, resume writing, and hook up with employers so
you can identify where that job place is at. So that is the
rebranding part of it, but it is also part of what we do with
veterans.
Now, if we were to look at proposals that would somehow
consolidate these programs and cut them back because they would
be block-granted, there would be fallout because many of these
programs are identifying certain populations with different
needs, and while we have programs that deal with homeless
veterans we also have the WIA workforce investment programs
that deal with veterans that are coming from their communities,
so they are not necessarily homeless but we have different
entry points for them, and especially for homeless veterans.
And that number continues to go up, and with respect to women
veterans and homeless women veterans it is astronomical. And we
are barely, in my opinion, touching the tip of the iceberg
there, but we have attempted to try to bring these programs to
work to consolidate and to provide better standards of
efficiency, and I think that is where we are going in our
budget.
We know we have to do a better job of employment placement,
and that is why we are working aggressively with the chamber of
commerces. We have already done 100, I think, over 100 fairs
with the national and local chamber of commerces and we want to
do more. That is why the president is asking us to also set
aside new tools, one of them called the Gold Card Standard,
that would allow for any veteran that is coming out of war to
be able to utilize 6 months of intensive services. That is
unprecedented and we know that the success rate for those
veterans is much higher when they have the ability to receive
those services and they don't fall out of the system. They get
assessments, diagnostic treatment, and whatever they need.
Mr. Miller. Thank you. Just if you could quickly, in the
time remaining--and I have seen some of this consolidation
driven by the economy and budget cuts that--in one of my
counties, where I think it is a much more efficient office than
it was before, in fact, because people are now in a central
location, they are--the specialists are talking back and forth
across----
Secretary Solis. Right.
Mr. Miller [continuing]. You know, to help these
populations.
But the other question I have is this constant discussion
in the nation about the mismatch of jobs available but skills
not in that geographical location, apparently, and we see
different publications--in my own area it would be machine tool
operators would be in short supply in Northern California.
Secretary Solis. And I believe that some proposals from WIA
that you all are working on that I have seen recently and also
in the Senate are addressing the issues of sectors and looking
at how we can better identify sectors regionally so that we can
focus our dollars in retraining individuals that match up with
those manufacturers and businesses that are there or that want
to locate in an area, and that--and Silicone Valley is a very
good example of that. Out in Florida we have NASA but we also
have a good group of individuals there who are going to be
transitioning. We have got to find out what other manufacturing
or scientific industries we can begin to grow.
And that is what we are doing with--we are doing that right
now with the TAA Community College Fund. That is why that is so
important. That is why they are--also the renaming of the
community college career program overall, I believe, we have
learned some great things with the TAA community college
program but we know we can build it out.
We are hearing very, very positive feedback from businesses
and entrepreneurs because they have told me, ``Hilda, Secretary
Solis, we don't necessarily need a Ph.D. or we don't need
someone with a master's. What we need is a technician. We need
someone who can get a 1-or 2-year credential at a community
college that we can train. They can be trained even on our
assembly floor or in our lab and then also get that certificate
and move up creating, then, another slot for someone new to
come in.'' And I have seen it; I have heard it as I have
traveled around the country.
These are positive gains that we have seen and I am sure
that--I would be happy to share a lot of that through my ETA
program, our assistant secretary who is here, Jane Oates, right
behind me to help fill you in on what other opportunities there
are.
Chairman Kline. Gentleman's time has, indeed, expired.
Mrs. Biggert?
Mrs. Biggert. Thank you, Mr. Chairman.
And thank you for being here, Madam Secretary. And thank
you for withdrawing the fiduciary rule. I appreciate it.
And to that end, you have solicited, I know, a significant
amount of information from the investments sector, and I have
heard from various industry groups that compiling the data that
you have requested can be a very labor intensive process and
there is the fact that it could compromise investor privacy. So
is it really possible for the firms to retrieve this data? I
know that it was very broad and they are not exactly sure what
was supposed to be within it, and are you concerned that the
investor privacy could be compromised?
Secretary Solis. Well, thank you, Congressman Biggert. I
know that we have heard much from the community, from the
Congress as well, and we have taken note of that and that is
why we are reproposing this particular regulation, and we do
require more information. In fact, we asked particular groups
that were involved in collecting data and when we asked them to
provide that information they have been reluctant in giving us
that information. And it is not as though, in my opinion, that
we would be somehow----
Mrs. Biggert. Well, I think that you had a----
Secretary Solis [continuing]. Abusing--abusing----
Mrs. Biggert [continuing]. There was a meeting with the
EBSA, and--to go over what--what the data was supposed to be
and wanted assurance that the participant confidentiality would
be looked at.
Secretary Solis. We certainly would be happy to continue
our conversations, and my assistant secretary, Phyllis Borzi,
is actually doing a lot now since I think I last came to this
committee to actually get more information from the industry,
to actually talk to individual stakeholders and really try to
get the most competent, more efficient information as soon as
possible. But I will say that we did attempt to work with a
consulting firm--you probably know the firm, Oliver Wyman--and
they were reluctant in passing along some information, and I
understand they were actually doing a study on this rule.
Mrs. Biggert. Right. Well, Assistant Secretary Borzi has
indicated that the reproposal now--is going to be issued in
May?
Secretary Solis. At this time we are still collecting data,
so I am not quite sure what she meant, but I can certainly get
back to you on that.
Mrs. Biggert. Okay. She also said that it is--that they
will seek to greatly expand liability for the companies that
provide services to IRAs and pension plans?
Secretary Solis. I would only tell you that one of the
things that we are looking at in terms of the rule is to make
sure that we have a balance and that individuals understand
that when they seed information and advice that it--that there
is a difference when someone has a conflict of interest and
they are making suggestions and informing individuals, and
there is, how could I say, a clear line that someone is getting
advantage because they are giving information and there is a
conflict, then we do have--we do have an issue, and that is why
we are looking at this rule in that manner. But we are
collecting more data and we would be happy to sit down with you
further and with any individuals that you think that we have
somehow missed in our discussions with stakeholders.
Mrs. Biggert. I would appreciate that.
And then, it is my understanding that the SEC intends to
issue a request for information in the coming months to ensure
close coordination with the investment community as they work
to comply with Section 913 of Dodd-Frank, so we are kind of
back to where we were in the beginning. Do you plan to
coordinate with the SEC as you work----
Secretary Solis. Absolutely.
Mrs. Biggert [continuing]. Towards the----
Secretary Solis. Yes. Yes.
Mrs. Biggert [continuing]. Reproposed rule?
Secretary Solis. Absolutely.
Mrs. Biggert. Do you plan to incorporate SEC's RFI findings
into your proposal?
Secretary Solis. Well, I think at the appropriate time we
will have those meetings with my assistant secretary and
representatives not only from the SEC but also with the CFTC,
as well.
Mrs. Biggert. Well, you have issued joint RFIs before with
the Treasury Department. In order to ensure there is no
misunderstanding about the degree to which your department is
working with the SEC would you consider a joint RFI with the
SEC?
Secretary Solis. If it is a practice that we have used in
the past I don't see why we would deviate, so I know that those
consultations will be occurring.
Mrs. Biggert. And you would put it into a joint RFI?
Secretary Solis. I couldn't say at this point because I
don't have all that material and, you know, we are currently in
this process so I know I can only speak on this issue with
limitation because of the Administrative Procedures Act.
Mrs. Biggert. In just a minute that I have, could you tell
us how the new proposed regulation will be significantly
different from the one that you----
Secretary Solis. Well, since we are in the rulemaking
process I am not privileged to be able to get into all those
details, but I would be happy to, after a point, be able to
either sit down with you myself or have--my assistant secretary
is more appropriately informed on this issue.
Mrs. Biggert. Thank you so much. I yield back.
Secretary Solis. Thank you.
Chairman Kline. Mr. Kildee?
Mr. Kildee. Thank you, Mr. Chairman.
Secretary Solis, it is good to have you back here. You
mentioned the Job Corps. I am very proud of the Job Corps
facility we have in Flint, Michigan. It is one of the state-of-
the-art Job Corps. We have a child care center, where many
women who ordinarily would find it very difficult to get
further training naturally come and live there with their
children in an up-to-date child care center that meets all the
criteria that the state of Michigan requires for such child
care centers. So it has really changed people's lives. You
mentioned Nate Ford.
Nate, are you--can you just--stand up, Nate.
Now, Nate illustrates that these are not just numbers.
Thank you, Nate. Thank you very much.
These are real people whose lives have been changed, and I
often go down to the graduations for the--at the Job Corps, and
you find a great deal of happiness, and joy, and expectation,
hope because they have picked up skills--specific skills in
welding, and electrical, food service, and still just in work
habits that the Job Corps does. The truck plant in Flint,
Michigan now has a third shift going. We haven't had a third
shift going at that plant in most people's memory--my memory, I
go back a long time, 82 years, but it is--and they need skilled
people.
The day used to be that you could graduate--or quit school
on a Wednesday in Flint and go to work for General Motors on
Thursday. Those days are gone forever. You need skills, and
those skills--one good thing about the Job Corps is that the
flexibility is there, what the need may be, what skills might
be needed in that area served by that Job Corps or in our
country, that you aren't static; you are dynamic, and I really
appreciate that very much.
And what more can we be doing with the Job Corps to really
reach more people and touch more skills?
Secretary Solis. Congressman Kildee, you hit it right on
the nose. It is about getting--drilling down on providing
better training either through apprenticeships, also that are
offered at the Job Corps programs, or credentialing--better
credentialing. And what that means is that the Job Corps
programs also have to enlist the support of local employers and
making sure that those connections are there, but not just
employers but also the communities where they are fixed,
because they also provide jobs for people who live in those
communities.
So there are many valuable things that are learned that can
be ingrained, and obviously this young man here is obviously
doing great work now, but there are so many that are still
attempting to try to find exactly where they are going to be
best suited. And that is the good thing about Job Corps,
because it allows you to go through a series of training that
can last anywhere from 6 weeks to 6 months, but nevertheless,
in a 2-year period you can gain credentials as you start to
move around at that center, so you may start out interested in
being a truck driver or getting a license to do that but you
may end up soon looking at what transportation jobs are
available, say, with the local state department of
transportation, or TSA, or any other entities that involve
transportation security.
I have seen that work effectively. I have also seen a new
emergence in areas like I.T. and health care, so now we are
also training up people in ambulatory care for health. That is
the area that continues to grow, whether it is a pharmacist
assistant, LPN, nursing, looking at some higher placed areas
that are going to provide a better wage for these individuals,
because many of them do have children. Some are parents--single
parents; some have obligations.
And it is really intriguing to me, when I get a chance to
go out to visit the Job Corps centers--I think I have spent the
most time of any secretary that I know of at the Department of
Labor that has visited most of her Job Corps centers. I think I
could say that with the exception of maybe Alaska and Hawaii; I
have not been to those places. But genuinely visiting even the
chairman's state, I have had the luxury of meeting many of our
Job Corps students as well as our YouthBuild students.
And I am really excited that we are focusing in on
renewable energy. So that is another part. It is conservation;
it is restoration of housing, commercial buildings. I have also
seen the diversity factor because you see a lot of diversity in
terms of our student population.
Mr. Kildee. Thank you, Madam Secretary. You know, what I
have noted, too, sometimes someone will go to Job Corps just to
get some good work skills and very often will find their
vocation there. And there is a--they see so many other things
going on that they really find themselves and find a vocation.
So that flexibility you find in the Job Corps is very----
Chairman Kline. The gentleman's time has expired.
Mr. Kildee. Thank you, Mr. Chairman.
Chairman Kline. Mr. Thompson, you are recognized.
Mr. Thompson. Thank you. Thank you, Chairman.
Madam Secretary, thanks for--it is good to see you again.
Thanks for being here.
I know, you know, I appreciate you being here because I
know you must--you are busy, and one of the reasons I know that
because I think the last--first time you were here I had posed
a question on project labor agreements that I want to address
here first and it took 14 months to get a response. So I
attributed that to a very busy schedule.
February 2010 I asked you about a project labor agreement
imposed on construction of a Job Corps center in Manchester,
New Hampshire, and I asked why the bid process was mysteriously
canceled in November 2009, and you indicated--the department
followed up with my office--2011, a year later, you were here
for an annual budget hearing and still I hadn't heard back and
you agreed to provide an answer in writing, and I always say,
better late than never. I finally did receive a response 395
days after the initial request.
Now, the administration contends that project labor
agreements control cost and the president put forth an
executive order encouraging PLAs. However, in areas like New
Hampshire or my state of Pennsylvania this removes about 85
percent of the eligible firms from bidding on those projects--
firms that, frankly, provide some really great jobs.
Now, I learned from your response that the department was
taking time to reevaluate PLAs, so we fast-forward to 2012, the
Job Corps center in Manchester has gone to bid again with
another PLA. Now, this is another 2 years later--2 years that
could have been a prime employment opportunity for hundreds of
workers. Now, I don't represent the Granite State, but I don't
want to see this happen nationwide.
The president said in his State of the Union that he wants
to reduce red tape. Well I ask, then, is the Department of
Labor just flirting with the idea of job creation or has the
administration learned something from New Hampshire and begun
to reconsider the executive orders on project labor agreements?
Secretary Solis. Thank you, Congressman Thompson, and I
apologize if we did not get back to you in a timely manner, but
this has been a area of, obviously, great concern to the
Department of Labor, and while we are speaking right now you
must know that there has been a bid protest filed with the GAO
on the New Hampshire solicitation, so I am awaiting a
determination on the protest by GAO right now. So I can't go
into much detail because I am precluded while this
investigation is ongoing.
But I will tell you that the reason for looking at the PLA
to begin with was we had a study--an extensive study--done. As
you know, you laid out the course of what happened initially,
and so we withdrew the first proposal that went out there and
then we did our study and we looked at how this possibly could
be redone, and we put it out again, and now as a result we have
a--contest--protest bid at this time. So I can't get into much
detail.
But nothing could be further from the truth that I want to
see jobs created. I want to see that these actually two centers
that we are looking at--Manchester as well as in Wyoming--that
we continue because they add to the local economy. There are
local hires, obviously; there is staff that is brought in. And
then the service that is provided there for the long term are
all valuable. So I certainly want to see how we effectively use
our tools.
But also, when the president has asked us to look at these
projects that are over a certain amount of money then I am also
responsible for carrying out and implementing his policies, and
obviously wanting to keep in mind and be mindful of the welfare
of those treasury funds that I am able to apply. So yes, we
look at these things very seriously. We want to also help the
local community in their economic development because any time
that we put together a project or proposal that goes out we
obviously want to help locals obtain those jobs because we know
we are in a very tough market.
Mr. Thompson. Right. Though, I have to say, I am just--I am
appalled by the president's policies who--you know, we have
almost 14 million Americans who are unemployed, and yet at, you
know, just the little bit of narrative I offered there, the
president seems to be concerned about creating union jobs. But
we should be just creating jobs, and then if unions are
involved that is great in an open and free market of bidding
and getting the best return on investment for the precious
taxpayer dollar.
I have a data question just real quick, because my time is
just about out: There is 8 percent--over 8 percent
unemployment, 14 million Americans, yet a lot of employers I
talk with have good-paying jobs that are sitting open, and
largely because of what I call the skills gap. You know, they
can't find qualified and trained employees.
Does the Department of Labor have data--do you collect data
on the number of jobs that employers have been unable to fill
with a qualified and trained worker?
Secretary Solis. Well, you know, the information that we do
get obviously changes and fluctuates but we do know that there
are a number of jobs that are out there, and as I said earlier,
there are a number of employers who are saying that there is a
mismatch.
Mr. Thompson. But do you collect that data?
Chairman Kline. Sorry. The gentleman's time has expired and
we will--I am sure we will ferret out the answer to that here--
--
Mr. Thompson. Actually, I would just ask for a response----
Chairman Kline. For the record?
Mr. Andrews?
Mr. Andrews. Thank you, Mr. Chairman.
Thank you, Madam Secretary. Welcome home. Thank you for the
role that you played in turning around a situation where from
the bottom of the recession the nation's employers have created
3.9 million private sector jobs, most of which, I would note,
are not union jobs, and we appreciate your role in that.
I want to walk through some of the criticisms we have heard
about your department and the administration this morning and
then look at the facts. We have heard about the explosion of
federal spending. My understanding is that the budget you
proposed this year is lower than the budget that you operated
under last year, that you had $10.673 billion last year, it is
$10.4 billion this year, so your proposal is $273 million less
than last year. Is that correct--that you are going to be
operating under?
Secretary Solis. Yes.
Mr. Andrews. We appreciate that example that you are
setting.
We have heard some criticism about the Office of Labor
Management Standards. My understanding is that in a budget
where you propose a $273 million overall cut in your budget you
have proposed a nearly half million dollar increase in the
budget of the Office of Labor Management Standards. Is that
right?
Secretary Solis. I don't have that in front of me, but I am
sure--I am certain the figure is correct because we have made--
--
Mr. Andrews. And my understanding is that Congress gave you
less money than you asked for last year in that category by the
time the appropriations were done. Am I correct about that?
Secretary Solis. Yes.
Mr. Andrews. I also see that the activities of the office
have been rather substantial. My understanding is there were
321 criminal investigations launched by that office last year,
461 union audits, and combining 155 investigation of union
elections. Is that reflective of the activities of the office?
Secretary Solis. I have that information in front of me
that I read off to you.
Mr. Andrews. Yes.
Secretary Solis. Our numbers have, I think, overall
improved, and in areas of election investigations, where there
was--there had tended to be fraud, we have actually upped that
significantly.
Mr. Andrews. And my understanding is that the criminal
investigations are actually greater than that of the
administration that came in before you.
I know one thing that you haven't done. There have been a
lot of legends floating around about the proposed youth
agricultural rules that you proposed earlier and have since
withdrawn and are reconsidering, and I know that what you have
focused on there is the issue of the disproportionate number of
young people dying in work-related injuries on farms.
My understanding is that if you look at work-related
fatalities for workers between the ages of 15 and 18 that in
2010 53 percent of the young people who died on the job died in
agriculture, but a--obviously a much lower number of young
people employed are in that field. Is it correct that a
disproportionate number of fatalities for teenage employers
come in agriculture relative to other occupations?
Secretary Solis. Well, the figures that you are citing are
accurate, and that is why we are moving in the direction of
trying to provide more protection, because as you know, back in
2009 15,012 children were injured on farms, and I am not
talking about just--we are talking about serious injuries and a
cost to the industry overall----
Mr. Andrews. I know what you are not talking about is, you
know, battery-powered screwdrivers.
Secretary Solis. Right.
Mr. Andrews. Or abolishing 4-H programs. Am I correct about
that?
Secretary Solis. Absolutely.
Mr. Andrews. Those are wild exaggerations and inaccurate.
The other thing I wanted to say is that--and I thank our
friend from Illinois for pointing this out--one of the so-
called job killing regulations that was under consideration was
the new fiduciary rules. Now, I think there were many good
things in those rules. I would like to see them revisited.
But you withdrew that, didn't you, and you are
reconsidering it because what you heard from industry?
Secretary Solis. Right.
Mr. Andrews. And why did you do that?
Secretary Solis. We received a number of comments and
letters from the House and from members of the Senate, and
obviously from the community and stakeholders, and we are
looking to see how we can actually create a better process. But
we don't want to be rushed, also, into a situation where we are
not actually doing our due diligence.
Mr. Andrews. And then finally, I am glad we share this
commitment to job training. I know it is sincere and important.
Across the building today the Budget Committee is marking
up a Republican budget that has a 48 percent cut by one measure
in job training funds. What do you think that would do to the
economic recovery?
Secretary Solis. I haven't actually reviewed everything,
but what I have seen so far and read in the press I know that
it would have a devastating effect in terms of the vulnerable
populations that we spoke about earlier--veterans, obviously,
dislocated workers, and youth. And in particular, it would have
an impact in terms of our ability to even conduct our
enforcement efforts. So literally pulling back on some of the
gains that we have made in the last 3 years.
Mr. Andrews. Thank you----
Chairman Kline. Gentleman's time has expired.
Dr. Roe?
Mr. Roe. I thank the chairman, and I also thank the
secretary for being here. And I want to associate with your
remarks about Don Payne. I very much appreciate it and I
associate myself with those remarks.
And just a couple of things. I was reading your testimony,
and it--just a source of a little irritation for me was that we
created over 2 million private sector jobs. I would say that
the private sector employers did that and took risks, as I did
as a private employer, to go out and borrow money and create
jobs. So just a point--maybe you didn't mean that the
government did. The government didn't create those jobs;
private entrepreneurs like myself went out and took the risk
and signed their name to a note, and entrepreneurs did that. So
just a comment.
On regulation--and I am going to just mention these just as
a, again, a private business person. I visited a surface
silicon mine and they got a MSHA ding for a toaster plug--two-
prong plug instead of a three-prong--nobody feels any safer in
that mine because of that. A friend of mine--a very good friend
of mine--had an OSHA ding because he had to stop building a
bridge across a river because he didn't have a boat in the
river, and of course, as you know, you are tethered to a cable
when you are working on there and a climbing harness, and the
only problem with it was if you would have fallen in this river
you would have died on the rocks because the river wasn't as
deep. So he had to stop, go buy a boat, drag it across the
rocks, tie it off to a tree, and then go back to work.
I can go on and on and on about just OSHA things that I
have seen that just--that don't make workers any safer. Clearly
you want a safe work place, but when you get that kind of
minutia it is--I have seen a ding with a hand sanitizer being
out of date. Well, the active ingredient in hand sanitizers is
alcohol, and from the state of Tennessee where I am from
usually it gets better with age, not worse, so----
[Laughter.]
Just a comment.
Very quick comments on the veterans. On the HUD-VASH
vouchers one of the holdup on those--because I am on the
Veterans Affairs Committee--is the number of caseworkers, so
that is holding it up some for you all. I know Mr. Miller made
a point about that and the V.A. is trying to get those
caseworkers. We have the vouchers; it is to get the caseworkers
to manage the cases for the homeless veterans.
I would like to--and one final comment: I certainly wish
the Department of Labor had come along with those farm things
when I was raised on a farm because I might have avoided a lot
of work when I was a kid. I think that is maybe meddling beyond
comprehension when you are on a family farm and that is how
those folks--you start out as a child feeding the animals,
cultivating the property, driving machinery. I learned how to
drive on a farm when I was 10 and 11 years old. So I think you
need to really re-look that family farms are struggling today
to survive and you may make it impossible with these
regulations for them to survive.
I want to go back to Mrs. Biggert and the fiduciary rule. I
served as a--on our--in our medical practice as the--in the
retirement part, the pension part. With the fiduciary rule,
what problem with small investors are you trying to fix?
Because it is not clear to me--and the chairman and I wrote you
a letter, and I am going to go through all of the incredible
amount of material that your department asked for from private
industry. So what problem are we trying to fix?
I understand the big banking crisis and all that, but with
small investors--like my daughter just got a small IRA in her
first job--what problem are you fixing?
Secretary Solis. Congressman, what we are looking at in
that particular rule is protecting the retirement savings for
Americans overall. The law currently says that if a person
provides investment advice for a fee then that advice has to be
unbiased. And what we have found is that there have been
conflicts of interest so we are trying to clarify that.
So if someone is also gaining some type of fund or making
money because they are giving advice then that is a particular
category----
Mr. Roe. But here I have got these pages--I mean, I would
be worried about just, for myself personally, I have an IRA,
and the amount of information--personal information--you have
asked for--and it is pages of things here, and you have seen
it. I mean, you know what it is. Why do you need that?
Secretary Solis. Well, I will tell you. Unfortunately, we
do, through EBSA, our Employees Benefits Security
Administration, get cases where individuals were being told
where to make investments and were misled and their savings is
gone. And we have actual cases, and I would be happy to share
those with you and be happy to have----
Mr. Roe. I would like to see those because an actual one or
two or three cases--yes, you have got crooks out there----
Secretary Solis. Entire savings, Congressman----
Mr. Roe. We have laws against robbing banks and people
still do it, so dishonest people are going to do dishonest
things.
Secretary Solis. Right.
Mr. Roe. But most of these brokers, the ones I have dealt
with, are not dishonest people. They are trying to give you a--
to share a small investor some advice so they can invest their
$10,000 or $15,000 or $20,000----
Chairman Kline. Gentleman's time has expired.
Mr. Roe. I thank the chairman.
Chairman Kline. Mr. Hinojosa?
Mr. Hinojosa. Thank you, Chairman Kline.
Madam Secretary, thank you for your testimony on the
Department of Labor's budget priorities for fiscal year 2013.
It is always a pleasure to have you testify before our
committee.
While our economy is moving in the right direction and we
are creating jobs in the private sector I continue to have
serious concerns about the unusually high unemployment rates in
minority communities, among our young people, and for our
nation's veterans. Madam Secretary, yesterday I joined my
colleagues, Ranking Member George Miller and John Tierney, in
introducing legislation to reauthorize the Workforce Investment
Act.
Unlike Chairwoman Foxx's bill, H.R. 3610, the Streamlining
Workforce Development Programs Act, which calls for
consolidating WIA programs, our Democratic bill develops a 21st
century delivery system for workforce training and adult
education that leads to career pathways, increased educational
and workforce training opportunities, and economic self-
sufficiency for our nation's workers. What are your views on
H.R. 3610 and the consolidation of WIA programs?
Secretary Solis. Well, first of all, Congressman, thank you
for the opportunity to speak to you about issues regarding
disparities with respect to minority populations and the issue
of unemployment, because we know that especially the Hispanic
community and as well as African American community they have
higher rates of unemployment, and for young people it is even
higher. That is why I think the initiatives that we are
undertaking and proposing in our budget are going to help
provide them the tools, the education, the training that they
are going to need to be competitive and hopefully get that
assistance at a local community college or through our
workforce investment programs.
One of the things that you need to know is that our
workforce investment programs overall, the Dislocated Program--
Worker Program in 2010 helped to serve over 500,000 African
Americans. In our Job Corps, in our YouthBuild programs that
some members have spoken about already, we have served well
over 2,300 Hispanic students enrolled in the YouthBuild program
where they traditionally get a certificate to get into
construction, and now we are focusing on expanding that. With
respect to enrollment in Job Corps, it is about 8,000 of the
total number that are Hispanic in the Job Corps program, and
that is a very good program for many of our young people to get
to.
With respect to your other issue, getting American back to
work, the bill that you introduced here--Mr. Tierney, Mr.
Miller, and yourself--I have had a chance to look at just a
summary of what the bill contains and I would say that much of
your ideas in this bill replicate what we are proposing in our
budget. So I do believe we are on the same path but I also note
that the Senate--both bipartisan--Republican and Democrat--are
also integrating much of what you are presenting here, so----
Mr. Hinojosa. I am glad to hear you say that. Can you talk
about the impetus behind the agriculture child labor rules,
what led the Department of Labor to issue them and how long it
has been since they have been updated? I heard my colleague
talk about owners of small farms having their children work. I
have no problem with that. My father did that with seven boys
including me, and we all worked as children.
But I am talking about families that take their children
out into the field because they have no daycare to take care of
them while they are harvesting crops and doing that. That is
what I am concerned about.
Secretary Solis. First of all, Congressman, this particular
regulation hasn't been looked at since 1970, so it is about 40
years old that it hasn't been looked at. And you know farming
has changed dramatically, and I am not just talking about
family farms; I am talking about business-owned farms.
And what I want to make clear here is that we are not
talking about kids who are 16 years and older who are employed
on farms, because there is a big difference there, whether they
are family farms or big corporations. We are not talking about
kids who are working for their parents or on a family farm,
because we realize that is an important relationship to
continue. We are not eroding that.
And obviously we will be looking at much--many of these
items as we expand the proposal here of this rule. So I can't
go into a lot of detail, but I will say we have heard a lot
from a lot of folks--from businesses and from families--that
believe that this is an important aspect to have.
But I will say that there are injuries and we have to be in
a position where we are preventing that because they can also
have an injury in terms of the businesses overall. We know that
according to the academic--Academy of Pediatrics that injuries
cost society an estimated $1.4 billion per year when we look at
agricultural----
Mr. Hinojosa. Would you, as secretary of labor, recommend
that we look into this problem?
Chairman Kline. Gentleman's time has expired.
Secretary Solis. We are charged to do that, sir.
Mr. Hinojosa. Thank you.
Chairman Kline. Dr. Bucshon?
Mr. Bucshon. Good morning and thanks for being here.
The workforce participation rate--so 63.7 percent,
ballpark--is at a 30-year low. You know, we frequently quote,
not only politically but in the national press, about the
unemployment rate, but this number is something you don't hear
about very much, and so I would--the question I have is, do you
have an estimate--is there a way to estimate the number of
people that, although you can't--you are not finding them based
on unemployment applications, that have quit looking for
employment? Because clearly with the workforce participation
rate at a 30-year low--the unemployment rate itself is not, in
my view, a solid indicator of the number of people that really
are in trouble out there.
Secretary Solis. Congressman, I would tell you that we have
in the last 3 years, I think, seen unprecedented constraints in
our economic recovery overall, and I know that structuring of
our jobs because of outsourcing and incentives to move jobs out
over the last 30 years has had an impact, and while there are
some businesses that are doing well because they have taken
that approach that are--there are many jobs that are just not
going to come back here that we have lost. So we have a lot
of--large number of people who were trained maybe to work in
one industry for 10 or 15 years now find themselves with no
other source of income.
So we do need to provide continued training and assistance.
Mr. Bucshon. Sure.
Secretary Solis. The best thing I can tell you is we need
to do more with actually on-the-job training. We have actually
invested money so we can allow for businesses to hire people
that will help subsidize part of that wage so they can have on-
the-job training, and hopefully that business will----
Mr. Bucshon. And I think that some states have done that,
and that is, I think, a good idea. That also comes into the
issue of the number of underemployed individuals, which you
just touched on, I think. And is there a way the Department of
Labor can estimate or does--or have you estimated and have the
data on the number of people that are underemployed or the
number of people who are not participating in the workforce and
they are not applying for unemployment insurance so you can't
track them that way, so that we can get a handle on the total
number of people out there right now in our economy who not
only are unemployed but have quit looking--have--their
unemployment has run out, their insurance has run out, and the
number of people who are underemployed? Those numbers are the
ones that I would--if you have data I would like that to be
provided to the committee.
Secretary Solis. I would very much like to have my
commissioner--acting commissioner for Bureau of Labor
Statistics provide any information that perhaps isn't readily
or easily available. But everything comes to the Bureau of
Labor Statistics, and there are several reports that they
compile to gauge how the economy is doing in all those
representations that you just talked about. And----
Mr. Bucshon. Sorry to interrupt, but the reason is is
because the unemployment rate that is frequently quoted, you
know, in the national press and others is--would you admit that
that is a relatively poor indicator of overall employment?
Considering the underemployed and the people that have quit,
with the workforce participation rate at a 30-year low it seems
to me that a better number would--to report would be not only
the unemployment rate but the people who have quit looking and
the number of people who are dramatically underemployed.
Secretary Solis. Well, much of this area has been
researched for the--and been in place for the last 72 years, so
I can't assume that I could, as labor secretary, quickly change
what the Bureau of Labor Statistics has provided for the last--
--
Mr. Bucshon. No. What I am saying is can you report it,
rather than when you release your unemployment reports you
release an overall report on the unemployment rate but I never
see a number that is estimating these others.
I want to move on to another area. Thank you for your--but
we will look into that----
Secretary Solis. Be happy to have the Bureau of Labor--our
commissioner get back----
Mr. Bucshon. It would be important for those numbers to be
reported, also. I am looking at your----
Secretary Solis. We typically don't carry--we don't cover
that information now--the Bureau of Labor Statistics. They
don't do that. But certainly I have often asked them questions
about things----
Mr. Bucshon. Sure.
Secretary Solis [continuing]. That they could be looking
at. But we have--they have to get consensus, and in many cases
it isn't just our own country. There are standards that are
set, and treaties and I don't want to----
Mr. Bucshon. I want to move on to another area here. I am
looking at your budget request and the Office of Coal
Enforcement and Office of Metal and Nonmetal Enforcement seeing
increases in--you may not have those numbers but I have them
here--increases in the enforcement area, and a little bit
further up my list here I have the Federal Compliance
Assistance, which is--you are requesting a decrease in the
funding level for that. And from what I am hearing from
employers out there is there has been a shift in how not only
Department of Labor but other agencies in our federal
government are going away--towards aggressive enforcement and
less with helping with compliance, and you can submit that for
the record. My time is expired.
Thank you.
Secretary Solis. Thank you.
Chairman Kline. Thank the gentleman.
Mrs. McCarthy?
Mrs. McCarthy. Thank you, Madam Secretary. Thank you for
coming in again. And thank you for all the work that you have
been doing. I know that when you started your new job there was
an awful lot on your plate, so we appreciate everything you
have done and certainly I know you are not going to give up
until we have the economy back to where it needs to be and
certainly have the majority of Americans that are out of work
back to work.
I know that there has been critical work done under your
tenure, and again, as I said, I appreciate that. And I am
looking forward to doing whatever we can, certainly, here,
building on some of the department's successes and hoping to be
able to do that for our economical recovery.
That said, and a number of my colleagues have brought this
up on both sides of the aisle, I wanted to talk to you about
the department's efforts to update its fiduciary definition
under ERISA. There is no doubt that the economies of the day
have changed greatly since ERISA was enhanced, as you said, in
1974, and by those standards I do not oppose the department
taking a fresh look at it. However, I am sure that you know my
concerns lie more in the process by which the department has
conducted its work on this proposal rather than the general
ideas behind it.
Many of us, including myself, are pleased the department
withdrew their original proposal on fiduciary. There are
several issues to point out, but one in particular was the
department's rule which would--I happen to be on Financial
Services, also; we worked on this.
So there is a conflict with the Dodd-Frank Act objectively
of the uniform standard for care of the investors, and I know
that the president had put out an initiative to have
departments working together when there is going to be a
crossover on a piece of legislation. So we sent you a letter
this past November--myself, and Mr. Neal--Richie Neal--and Mr.
Himes--asking the departments what are some of the remedies of
the glaring issues in the original proposal? Unfortunately,
that was in November and we have not received a response yet.
So hopefully--there are probably about 30 members that have
signed onto this. We would appreciate if you could get that----
Secretary Solis. I will have my assistant secretary call,
if you would like, to set up a meeting with the three of you,
if you would like----
Mrs. McCarthy. That would be great.
And if I could offer the letter into testimony I would
appreciate it, Mr. Chairman.
[The information follows:]
------
Chairman Kline. Without objection.
Mrs. McCarthy. You mentioned in your testimony that much
progress has been made in implementing the executive order, and
I thank you again for that. But the progress that has been made
in the regard of the president's executive order regarding
increased interagency cooperations, when we have asked
different people, ``Have you been talking,''--and I am talking
about the SEC, certainly your department, you know, we are told
e-mails are going back and forth. And I think, you know, as we
are hearing--you know, as you are asking for more information
to come from those of interest sometimes they are only getting
a day's notice to get back to you, or to get back to the
department I should say.
So I think that is, you know, poor timing, especially since
the SEC has no timeline. And yet, Department of Labor is
putting out a timeline sometime this spring or summer to get
all the information out before they put a rule out.
So I think it is time, to be very honest with you, for many
of us that are members of Congress to really sit down with the
heads and try and figure out how we are going to go on this
when you have that information. I think it is really, really
important because it has been dragging on now for quite a long
time.
Secretary Solis. Right.
Mrs. McCarthy. It is not good. Businesses need to know what
they are going to be doing, and certainly we--many of us here
on this particular committee, many on the Financial Services
Committee--would like to work together and see if we can come
to some resolution in the near future.
Secretary Solis. Well, I don't disagree. I think we have
been working with the other agencies involved and I know that
my assistant secretary has informed me about those meetings
face to face. So it isn't all just e-mails; they do meet.
Because of the enormous response that came out about this
particular rule we have now reproposed it, so we are taking
that input and we want to get as much as we can.
But we did ask for the expertise by a group that was
actually looking at the rule, and when we asked for that
information they haven't been able to provide it. So we are
open. We will meet with whoever we need to and be happy to see
how we can accommodate this, because we want to have a fully
fleshed out rule, but--and I certainly am not in a hurry to
push things quickly until we have and feel comfortable that all
parties' concerns and we feel we have done a good job.
And I can't get into too much detail because we are in that
process now where I am not able to because of restrictions and
administrative procedures. So I will do what I can but I will
have my assistant secretary meet with you and other members of
the committee ifthey are interested.
Mrs. McCarthy. With that being said--and I don't want you
to say who the--who you have been working with as far as
working on the rule on the outside, but if you would share that
with me I would like to know only because I certainly will give
a push, also, to get their recommendations in.
Chairman Kline. The gentlelady's time has expired.
Mrs. McCarthy. Thank you.
Chairman Kline. Mr. Walberg?
Mr. Walberg. Thank you, Mr. Chairman.
And, Madam Secretary, thank you for being here. We
appreciate the opportunity, and probably my first couple issues
will be more of a statement since we have had the privilege of
having some of your undersecretaries and deputies in front of a
subcommittee that I chair.
But I did want to talk to you about the companionship
services issue. Yesterday my Subcommittee on Workforce
Protections held a hearing on the proposed rule. We appreciate
Ms. Leppink being there with us and addressing issues of
concern.
At the hearing one of my constituents explained that a
similar change to Michigan's law back in 2006 drastically
changed, and I quote--``his companion care business, negatively
affecting his caregivers and the seniors they serve.'' My
constituent also explained that there has been widespread
dissatisfaction with the law change in Michigan.
As you may know, 21 states and the District of Columbia
have, in varying degrees, extended wage and hour coverage to
caregivers. It seems to me that a close examination of the
impact in these states would go far to inform the department's
proposed rulemaking.
Unfortunately, it is my perception--and it is my
perception--the department has failed to analyze the practical
and economic effects of changing the law in each of these
states. And so I would ask you, Madam Secretary, what
assurances can you give the committee that you will take these
concerns into consideration before moving forward?
Secretary Solis. Thank you, Mr.--Congressman Walberg. I
know that my director did come before your subcommittee
yesterday and I understand that there was a good conversation,
at least, explaining what the Department of Labor is doing in
this area.
As you know, the rule is intended to help provide support
for the 2 million individuals who work in this industry,
mostly--90 percent--women, low-wage workers, low-skilled, and
we are----
Mr. Walberg. That give amazing, amazing service.
Secretary Solis. Absolutely.
Mr. Walberg. We have experienced it in my own home.
Secretary Solis. And clearly, as you said, 16 states
already provide minimum wage and it varies--and overtime. And
what we have noted in our analysis is that in terms of cost
over time there is the notion--and I would be happy to have my
staff provide more information--that there is a cushion
available to allow for overtime pay, and it would help--
actually help to provide more jobs for people in this growing
industry. We can't find enough people in the industry.
Mr. Walberg. I just beg to differ on that issue because
sound economics does not say that adding more costs will
ultimately provide more services for caregivers, more jobs.
Let me move on. But I just ask that you will seriously look
at the impact of other states--negative impacts to jobs and
caregivers.
In the issue of I2P2, it appears that your department is
taking a very adversarial approach to working with employers to
ensure the safety of employees in the workplace. There is a
great deal of concern about OSHA's work on a new Injury Illness
and Prevention Program, otherwise known as I2P2. A recent study
by the Rand Corporation concluded that a similar program--one
operated by California OSHA--showed no demonstrable improvement
in safety with the use of an I2P2-like regulation.
I would just ask again, can you give this committee an
assurance that this will not become one-size-fits-all,
inflexible government mandate on our states' programs?
Secretary Solis. Congressman, right now we are in the early
drafting stages of the standard and we are hearing from our
stakeholders, which include small businesses, both large and
medium sized, and we are listening carefully in terms of
drafting the standard. So we are taking every comment very
seriously and I would be happy to make sure that you know that
our intent is not to double-site a facility, because that is
not what we want to do.
What we want to do is try to bring conformity so that we
know that employers are helping to maintain safe workplaces.
That is really what we are trying to achieve. I know it is a
laudable goal, but it is one that is a work in progress.
Mr. Walberg. Well, thank you.
Finally, in a letter to Senator Tom Harkin the America Farm
Bureau Federation expressed some concerns about the new
proposed youth worker rule, and they quoted from the proposed
rule. Any activity involving physical contact with all
machines, equipment, implement operated by any power source
other than human hand or foot power, and the DOL has explicitly
stated this includes batteries--now I don't know if it includes
battery-driven screwdrivers, drills, or anything like that--but
power equipment will be prohibited for youth.
Now, while applauding the Jobs Corps successes I am
concerned about our agricultural youth being impeded by the
Department of Labor. And remember, there may be
disproportionate injuries but there is a disproportionate
number of non-farm youth that are working so of course there
will be more injuries related to farm work.
My concern is that until after the rulemaking process had
commenced and completed with the rule--proposed rule being put
forward, according to a letter received from your deputy
director at a request of Chairman Kline and myself there was no
opportunity for a listening session to agricultural community--
not agriculture worker advocates and all of the rest, but
actual agricultural community--farmers. And then a hearing was
given in October when my farmers were in the fields harvesting.
So I am concerned that--that we have had the opportunity from
the ag community to talk about why this is so much different
for youth workers on a farm situation that feeds the world in
comparison to the rest of the work situations----
Chairman Kline. The gentleman's time has expired.
Mrs. Davis?
Mrs. Davis. Thank you, Mr. Chairman.
And, Madam Secretary, it is wonderful to see you and to
feel the enthusiasm that you have, I think, for your job, for
making sure that workers can go to work, and be safe, and come
home and be with their families. I think that is what we all
want and we all value.
And I know that everyone believes that. I mean, we all want
people to be safe at work, and the reality is, as I understand
it as when you came into this position you found that there was
little enforcement going on. And so I think, you know, we might
all want to actually pick apart any one issue that has been
raised, but overall I think that it is important for people to
believe that at work there is going to be enforcement for all
those safety standards--for OSHA, whatever that may be.
Perhaps you might want to just give us one example of
where, in fact, something had been going on for a long time
affecting workers, and yet nobody had taken the time to really
take a look at it.
The other thing I just wanted to mention quickly is that
you have done an awfully lot in terms of veterans, and I really
am pleased to hear that. The issue that I think is a little
difficult at times is the coordination and knowing what is it
that is really making a difference for veterans in these
programs? Because one of the things that I hear is, you know,
the tie with a mentor, the tie with someone who is really
available to be helpful and to be helping to be a champion, and
a coach, and a real nudger, I think, for someone who needs
somebody there.
So I am hoping that you can maybe share a little bit about
how we are looking at the value of these programs, and what are
the themes that make a difference? And along with that, just
the issues--and I think Secretary Duncan maybe here next week
to talk about the G.I. bill and how that plays into the kind of
education and certification programs the people are getting and
to be sure that they are getting the best bang for their buck
in regard to that. So I have thrown out a few issues and I
wonder if you could just address that--the OSHA issue and--then
the veterans problems.
Secretary Solis. Well, I would go, again, to some of the
efforts that we have undertaken under the VETS division in
Department of Labor to try to really transform our TAP program.
And I think when I served in the House with you I remember the
TAP program not really able to show as much results, and there
has been a lot of criticism about that.
So we have revamped this program that has now been in
existence for almost 20 years to actually follow, monitor,
assess and make sure that we are in contact at every point with
that veteran before they are even released from the military,
and then continue it once they leave and instituting programs
like new tools, like helping veterans through our DOL Internet
programs to make sure that they can get information about where
training, whatever it might be, wraparound services, but more
importantly, employment, and getting them to understand that
there are tools available through the Department of Labor that
can actually help them identify the skill set that is
transferable to a job.
That is the biggest barrier right now for a veteran who is
coming home who may have been in charge of a battalion, may
have been a mechanic, but knows how to handle machinery,
welding, and all kinds of things. How does that credential or
how could that code that the military gives you for that job
translate into a particular occupation that is easily
accessible and understood?
We have revamped our program to do that so we are going
online in that way, but we also need to do more because there
are so many that are not finding that--particular age group
that is very young, the ones that are just coming back from
Iraq and Afghanistan----
Mrs. Davis. Madam Secretary, is it possible for the
Department of Labor to also identify typical programs that have
been useful? I think you don't necessarily identify certain
schools, per se, but one of the frustrations I hear is that
they don't know enough about those programs and get involved
and give out--get out their G.I.--you know, G.I. dollars to
schools that don't----
Secretary Solis. I think that is why we are also asking our
state veteran representatives that--actually, the states
receive funding for our programs to help them better work and
understand exactly the kind of assistance. It isn't just about
showing them, ``There is the job,'' it is actually tracing it,
monitoring them, giving the feedback that they need, the
coaching, the resume-writing, and also just getting them
involved with other--a network of other veterans so they feel
some self support. That is really important.
Those things work, and we can indicate, even in our own
results that when people do receive more intensive services--
that is case management--they are successful. That is why we
created this Gold Standard Card that for the first time is
going to allow for that tracking for 6 months.
Now that costs money, and those things are very intensive,
and a lot of our states have to be ready to do this. And we are
asking people to step up but we certainly want to work with
people on this committee as well as the Veterans Committee to
see how we can foster a better relationship. And we are doing
that with Secretary Shinseki--I enjoy working with him in the
Department of Defense--and our other friends and agencies like
OPM, because we want to make sure that we can also hire these
veterans for jobs.
We find that there are some barriers there and we are also
working and focusing in on that to make it easier for them to
also come back and get the job that they left originally. That
also requires funding and we find that there is a tremendous
need to focus our attention in those areas.
Chairman Kline. Gentlelady's time has expired.
Dr. Foxx?
Ms. Foxx. Thank you.
And, Madam Secretary, it is good to see you. You are
looking very well. It appears your job is agreeing with you and
we are glad to have you back in the committee.
Secretary Solis. Thank you.
Ms. Foxx. I want to first associate myself with some
comments the Congressman Roe said. I think it is very troubling
to me to hear so many people in this administration blame the
shortcomings of the administration on the previous
administration and on Republicans in the Congress but then
quick to take credit for what the private sector does despite
the administration, and particularly the Department of Labor.
So I will say that coming here and taking credit for the
private sector jobs that have been created is quite a stretch.
I would like to also say that in the bill that we have
proposed that would revamp the WIA programs you say--Mr.
Miller, I think, asked about cuts--there may be cuts in the
budget that has been proposed, but certainly in the bill that
we have put forward doesn't make any cuts whatsoever in the
program. And I would like to know what you can point to as
accomplishments in any WIA program. Give me numbers.
I want specific numbers on something that, as a result of a
program covered by WIA, that has created a positive effect.
Because in the 47 programs only five have any kind of
evaluation, and even those evaluations--I have looked at them--
can't show a positive--a cause and effect.
And I am very big on accountability. We are taking money
from hardworking taxpayers and spending that money, from people
who are already working. So show me one--give me one positive
impact, if you will.
Secretary Solis. Okay. Thank you, Congresswoman.
I would share with you that under our July 1, 2010 through
June 30, 2011 the WIA Adult Dislocated Worker Program served
8.4 million participants and nearly 6.2 million exiters--those
are program completers. The figures represent an increase of
300,000 recipients and over 400,000 exiters in program year
2009.
The Dislocated Worker Program completers received training,
showed nearly a 25 percent increase compared to those who did
not receive training at all. That is a 77.7 percent versus 52.6
percent, respectively----
Ms. Foxx. Okay. Let me stop you there. What in the program
made the difference? That is what I want to know.
Secretary Solis. I will tell you. We have really revamped
our program since I have taken over, and part of it is more
accountability, more feedback directly--you have my assistant
secretary here, Jane Oates, who you may know, who is spending a
lot of time----
Ms. Foxx. We have met.
Secretary Solis [continuing]. Conducting webinars and
direct calls. I have made myself available with the directive
that we now have to ask our workforce investment boards to do a
better job of working with our employers and making sure that
we are not just saying that the WIA boards have the onus of
trying to create jobs. It is about really making investments--
--
Ms. Foxx. Can you----
Secretary Solis [continuing]. And coupling our federal
dollars----
Ms. Foxx. Can you prove that the--and I hate the word
training, so can you prove that the materials presented and the
guidance given resulted in a person getting a job in the field
in which they were educated? Can you prove that?
Secretary Solis. I would say that we have rigorous
evaluation for all of our programs and we can show----
Ms. Foxx. Will you give me copies of those?
Secretary Solis [continuing]. We can show not just
attestation that they are receiving certificates but we could
also show that they are receiving jobs. And I would say----
Ms. Foxx. Okay. I would like to see that, and I----
Secretary Solis. Yes. We do have it. We do----
Ms. Foxx [continuing]. I would like to see the numbers of
how their income is increased.
The other quick question I have to ask you--and this is
very quick--you stated a little bit ago that the numbers of
people who would be affected by the cuts in the budget were
astronomical. You are very good at using hyperbole.
Tell me what an astronomical figure is in terms of women
homeless veterans. How many women homeless veterans--or any
other astronomical figure that you have--would be affected by
the budget cuts.
Secretary Solis. I have----
Chairman Kline. Gentlelady's time has expired. If we could
get that for the record?
Ms. Foxx. I would expect that in writing----
Chairman Kline. For the record.
Ms. Foxs [continuing]. And I don't want to wait 15 months.
Secretary Solis. Certainly. Certainly.
Chairman Kline. Thank you. The gentlelady's time has
expired.
Ms. Fudge?
Ms. Fudge. Thank you, Mr. Chairman.
And thank you, Ranking Member Miller. It is a pleasure for
me to be back on the committee.
Certainly my friend and mentor, Donald Payne, does leave
behind an impressive legacy of protecting workers' rights and
improving educational opportunities for our children. I hope I
can live up to that same standard. Thank you so much.
Madam Secretary, thank you for being here. And I do want to
at some point talk with your staff about the TAP program. It is
still a major problem. I had a meeting just last week with some
returning veterans and all of the agencies that are supposed to
serve them. I would like to at some point have you--have
someone from your staff interact with my staff.
Secretary Solis. Absolutely.
Ms. Fudge. First question, over the last year many of the
media outlets have released reports on the difficulty of
unemployed persons having problems getting jobs just because
they are unemployed. Many of the long-term unemployed do face
the reality that jobless people need not apply. What is your
agency doing about that problem?
Secretary Solis. Well, that is a very sensitive issue with
me because we know in our meetings that I have had throughout
the country we have heard individuals who are frustrated
because in some cases there are employers that actually
advertise jobs saying if you have been unemployed, period, we
don't--we are not even going to bother to look at your resume.
So we know that that is an issue and I have my staff--my
solicitors office also working with White House staff and other
agencies that have jurisdiction over this, because we think it
is wrong.
And I know that some states have actually taken on this as
a major incentive to try to get employers not to list that on
their postings. And we are hoping to work that out. I know I
will have my assistant secretary meet with you more, if you
would like, to give you an update on this, as well. Jane Oates
would be happy to meet with you, our employment training
administrator, because we have heard firsthand from people who
are, how could I say, sick and tired of not being able to get
even into the door to get interviewed.
And it is highly competitive, but I will say that there are
more people, or how could I say, there are fewer people now
competing for that one job. When we first started in this
recession there were seven people per one job; now it is four.
But it is still tough competition. That is why we need to have
more employment training, credentials, and we need to make that
match occur better.
And if we can use tools through the U.I. program like on-
the-job training to incentivize businesses to bring people on
and we help to subsidize, chances are they are going to end up
staying on that job.
Ms. Fudge. Madam Secretary, the other thing I just want to
say about that is that if we don't get a handle on this those
people who have been employed become the long-term unemployed.
They may never work if we don't find some way to keep them from
being discriminated against in the workforce.
My second question is that, you know, over recent years, as
productivity gains have been made wages have actually gone
down. You look from 2002 to 2007, productivity grew by 11
percent but the hourly compensation of the typical high school
or college educated worker actually fell.
Now, you know, they have a lot of reasons that they say
this is happening. One is that, you know, they say overseas
competition and declining union density is to blame for the
disconnect. What is, in your opinion, the problem here?
Secretary Solis. It is a hard question to answer, but there
are multiple things going on. I think there was a--just reading
an article yesterday in the Washington Post about the fact that
some economists say that American workers are the most
productive and that what is happening in the workforce is that
many businesses are not hiring more people because our
workforce has either become more mechanized or that they are so
efficient at their jobs that they are not--they are reluctant
to hire up the next slot.
What I see happening is that there are global factors at
play here, and a lot of jobs that we lost overseas. But I think
the real focus has to be in creating good manufacturing jobs.
That is why the president has talked about insourcing jobs,
bringing those jobs--some--not all of them will come back but a
good majority will.
Take as an example what happened in the automobile
industry. With that assistance now you see 200,000 jobs in the
last 2 years created not just solely around developing
automobiles but also the other subsidiary industries that go
with that. So you can look at almost a million jobs created
because now you have a restaurant going up, now you have----
Ms. Fudge. Madam Secretary, those jobs are much lower
paying than the jobs that people lost, so the job creators may
be hiring people but they are giving them lower wages.
Secretary Solis. I would say that wages have been stagnant,
and that is something that obviously we want to incentivize
businesses to do the right thing and hopefully spur more growth
by making those investments in areas--renewable energy, things
that we know are going to have a long-lasting impact in our
economy. We do have to have some major restructuring because it
hasn't happened in the last 30 years.
Ms. Fudge. Thank you.
Mr. Chairman, I yield back.
Chairman Kline. Thank the gentlelady.
Dr. DesJarlais?
Mr. DesJarlais. Thank you, Mr. Chairman.
And thank you, Secretary Solis, for being here today.
I think I am going to be fairly brief. It will depend on
how long your answer is, but I was at the Rutherford County's
annual farm bureau legislation luncheon this past Friday and
one of their big concerns was the child labor laws. And given
this great opportunity today to alleviate some of their fears
on what their farm kids can and can't do, could you just maybe
give me an update of where that stands and where it is headed?
Secretary Solis. Well, we are looking at the parental
exemption status, so I can't go into a lot of detail. But I
said earlier to the committee what we are attempting to do and
what it isn't. And first of all, I have to tell you again,
reiterate that this is a rule that has been around for 40
years.
What we are trying to do here is we are not talking about
kids who are currently employed, so if there is an employee
relationship, you know, we do--we care about if there are kids
16 and older that are working on a farm and they are exposed to
maybe equipment that could be harmful. We are talking about
grains; we are talking about equipment that can be injurious.
And I said earlier that there was a high rate of injury in
this area, so we want to protect them. We want better training.
We obviously want to allow for the 4-H and education programs
that we know have been around to also bring up their standards,
because with 40 years gone by there have been people that still
think it is done the old way, and in the old way you have more
injuries and it costs businesses more money.
But we are saying if it is a family farm then that is
different and we are not going to intrude on that. If it is a
farm where there is a relative we are looking at that as
something that is wholesome, fine. But when we are talking
about a business relationship with a business entrepreneur, and
that is different, then they have an obligation, and that is
where we are going.
But I can't really say a whole lot except to say we are
listening very carefully. We have gotten a lot of concerns,
comments, many thousands of paper on this. So I know that my
acting director now for Wage and Hour will be continuing to
meet with stakeholders and going out.
So as much as we can do and learn we are willing to do
that, but without compromising the safety of these young
people.
Mr. DesJarlais. But as far as farm kids, say 12, 13, 14, it
is not uncommon for them to drive the tractor----
Secretary Solis. If they do chores--chores is chores.
Mr. DesJarlais [continuing]. Driving the tractor down the
hayfield. There were some concerns about moving irrigation
lines. Somebody said that, you know, that could be considered
dangerous--excuse me--dangerous to the point that, you know,
they might even restrict them from standing in the front yard
with garden hoses. Now, you know, that sounds like----
Secretary Solis. Those are extreme.
Mr. DesJarlais [continuing]. That is an exaggeration, but
nonetheless, how intrusive is this going to be in terms of----
Secretary Solis. Well, I can't talk definitively about it
because we are proposing it, but I can tell--I can assure you,
as I said, the idea that somehow we would be regulating the use
of a battery-powered screwdriver is not my may of rationalizing
how we want to protect people. We are talking about tractor-
trailers when people are not appropriately trained, and we are
talking about a difference in terms of relationship. If it is a
child whose family owns a farm that is a different
relationship; I am talking about an employer relationship.
Mr. DesJarlais. Tennessee has the largest farm bureau in
the country and I know they are very interested in this, so I
would encourage----
Secretary Solis. We would be happy to meet----
Mr. DesJarlais [continuing]. Further dialogue.
Secretary Solis [continuing]. We would be happy to talk to
them.
Mr. DesJarlais. That would be great.
Secretary Solis. Thank you.
Mr. DesJarlais. I am losing my voice so I will yield back.
Secretary Solis. Okay.
Chairman Kline. Thank the gentleman.
Mr. Holt?
Mr. Holt. Welcome back, Madam Secretary. We are always
proud and have been proud for years to call you colleague, and
I am pleased to acknowledge all the good work you are doing at
the department. It is gratifying to note that under your
leadership the department has taken strong action to protect
the health and safety of mine workers; that under your
leadership the Wages and Hours Division has recovered more than
$200 million in back wages on behalf of hundreds of thousands
of workers; that under your leadership the workforce system has
served 1.7 million veterans, as you have discussed, and helped
tens of thousands of youth get high school diplomas.
There is so much that you do. Let me just give you three
questions, quickly. I think they can all be answered briefly,
but maybe you will want to provide more information, then,
later.
First, with respect to the Workforce Investment Act, I am
pleased to join our colleague, John Tierney, and others in
proposing a good reauthorization. I am also pleased to
acknowledge the good work of Jane Oates in that.
As you know, I support the use of more online training
under WIA and also support fuller inclusion of libraries----
Secretary Solis. Right.
Mr. Holt [continuing]. Public libraries--into WIA. Can you
say that your plans for WIA include a greater role for
libraries and increased online training?
Secretary Solis. Right. Absolutely.
Mr. Holt. And I would like to turn to a couple of other
questions.
Secretary Solis. Yes.
Mr. Holt. With respect to the fiduciary rule, after our
previous discussions you withdrew the draft rule for--so-called
fiduciary rule, and I want to thank you for soliciting----
Secretary Solis. We heard you.
Mr. Holt [continuing]. More data to inform a better
understanding of the problem before reproposing the rule. I am
a little concerned, however, that the department is asking the
wrong questions, and in requesting more data you won't get the
data that will actually get to the issue of how employees make
decisions, and whether--what you can do to help employees make
decisions that will leave them better prepared for retirement,
how we can increase access to investment advice.
So the question I have is, are you finished asking for
additional data? I hope not because----
Secretary Solis. No. We are not finished. That is why it is
open. And we definitely want to hear from stakeholders and your
comments, and obviously hear from the public overall. So we are
not in a hurry to do this.
Mr. Holt. And if you could state at some point, you know,
publicly that your goal here is to provide greater access to
advice so people--so that people--this is a joint goal--so that
people will be better prepared for their non-wage earning
years. It is not advice for its own sake; it is advice so that
people can be better prepared.
Secretary Solis. Absolutely. We don't have disagreement
with that.
Mr. Holt. You may know that Representative Petri and I have
introduced a bipartisan bill, the Lifetime Income Disclosure
Act, also directed at helping people be better prepared for
their non-wage earning years. It would provide clearer
information about how well their savings would cover their
monthly expenses. And it is my understanding that the
department and Treasury--that your department and Treasury are
close to finalizing a lifetime income rule.
Will you call for clearer information to help people plan
better for retirement so that they have an understanding of
what their retirement package might mean for them day to day,
month to month, so that they will have a sense of----
Secretary Solis. I don't----
Mr. Holt [continuing]. How well prepared they are?
Secretary Solis. Right. I don't disagree that we are on the
same wavelength, so to speak, because we do want to see more
information, more transparency so people do have choices. So I
think we are moving in that direction.
And to the extent that we are asking for more public
comment and meeting with stakeholders, if there are individuals
that you think that we need to hear from please help us
facilitate that. And I know Phyllis Borzi has met with you over
the last 2 years on this issue, and she cares very deeply, as I
do and this administration, in making sure that we get the most
ample and very open process so we hear from everybody. So I
will take that back.
Mr. Holt. I certainly appreciate that. And I think she does
understand, and I hope--I just want to emphasize and make sure
everyone understands----
Secretary Solis. And I want to thank you for your
leadership----
Mr. Holt [continuing]. That the goal here is to help people
be better prepared, to get them access to information so that
they can make good decisions. I thank you very much.
Secretary Solis. Thank you.
Chairman Kline. The gentleman's time has expired.
Mrs. Roby?
Mrs. Roby. Madam Secretary, thank you for your time today
and answering our questions.
I want to talk about health care. You, in one of your
answers a few minutes ago, referred to the small businesses
that are a result of larger business that creates jobs. The
private sector creating these jobs then often leads to more job
creation surrounding an industry, and you referenced that by
mention of restaurants.
And I want to talk specifically, because early on for me in
Congress I had the opportunity to sit down with an owner of a
Pizza Hut in Headland, Alabama, who explained to me that once
implemented the government mandate that would require him to
purchase health care--government approved health care--if he
had over 50 employees would be devastating to his bottom line
with all of his other expenses relating to owning that
franchise. So I want to ask you specifically, because of the
cost associated--the penalty that would have to be paid, the
$2,000 per employee after the 30-employee exemption, the
$42,000 that would come directly out of a small business that
hires one additional employee to get over the 50-employee
threshold, how in the world can we expect small business, which
drives this economy, to be incentivized by that tax to create
jobs?
Secretary Solis. Well, obviously my role in the Health Care
Act is more with overseeing the implementation of the plans,
and Phyllis Borzi, who heads my Employee Benefits Security
Administration has been my representative working with HHS and
Treasury to help formulate and put the regulations out. And I
know we are looking at how we can better provide more
opportunities so small businesses and their employees aren't
just thrown out and that they have some potential coverage. So
we are going----
Mrs. Roby. But certainly in your position, Madam Secretary,
as the secretary you certainly have an opinion on whether or
not that threshold and that penalty will help job creators,
because certainly it will not. We know that this is going to
cause these small businesses in some instances to have to close
their doors. And I reference back to the Pizza Hut franchise
owner in Headland, Alabama, who has stated just that.
Secretary Solis. Well, there are several studies that have
been done that actually have an opinion on this, and I would
point you out--and I can certainly give those to you, but what
I am hearing, like, as an example, from Thomson Reuters
Consulting, they say that, quote-unquote--our clients, none of
them have alluded to dropping coverage and would not have heard
from a client. So I know that there has been a recent CBO
study----
Mrs. Roby. I think there would be--we would need to know
the specifics around what those businesses look like, because
in the case of this gentleman, different businesses have
different overhead costs, and when you add the cost of the
health care mandate on top of that it is going to severely hurt
small business job creation throughout the country.
Secretary Solis. Well, I know that there is an effort to
get our states to begin to look at exploring the exchanges that
would be developed so that small employers can attach
themselves if they don't currently have health care coverage
and be able to allow, also, for a more ample opportunity for
people to choose what kind of health care is out there. And
that could also help to be a softening blow and actually help
many small employers because they----
Mrs. Roby. But you agree it is a blow. It----
Secretary Solis. Well, I don't agree with that because I
agree with the Affordable Health Care Act, that it is providing
coverage to many people who aren't being covered right now--not
just----
Mrs. Roby. But if the employer can't afford on its bottom
line to cover those individuals then they are going to pay the
penalty, but in order to get out from under the penalty they
are not going to add more jobs so they can stay under that 50-
employer threshold, and that is the point, is that it is not an
incentive to small business creation.
One other thing real quick, because it has been referenced
on more than one occasion throughout this hearing, is the
regulation amending the definition of fiduciary. And 54 of my
colleagues--we all signed on to a letter and we have yet to
receive a direct response as it relates to that letter and the
criteria that we would like for you to consider in promulgating
that definition, so I would hope that there would be a more
formal response as it relates to those specifics.
Secretary Solis. I know that we had received letters from
members of the Senate and the House, and when they came in at
one point our period had already closed for comment, but that
is not to say that what was included in your letter wasn't
already submitted by other individual stakeholders that had the
same type of----
Mrs. Roby. Well, we didn't receive the response that was
given to the other stakeholders, so if you would provide that
information to us we would appreciate it.
Secretary Solis. I am certain that we will do what I--what
we can on that.
Mrs. Roby. Okay. Thank you very much.
I yield back.
Chairman Kline. Thank the gentlelady.
Ms. Woolsey, you are recognized.
Ms. Woolsey. Thank you very much, Mr. Chairman. Mr.
Chairman, I would like to ask unanimous consent to enter into
the record the economic situation--Employment Situation Summary
that goes along with each month's employment report that the
gentleman from Indiana referred to, that actually reports long-
term unemployed, the--those who are discouraged workers, and
the part-time workers----
[The information follows:]
U.S. Bureau of Labor Statistics
Economic News Release
Employment Situation Summary
Transmission of material in this release is embargoed USDL-12-0402
until 8:30 a.m. (EST) Friday, March 9, 2012
Technical information:
Household data: (202) 691-6378 * [email protected] * www.bls.gov/cps
Establishment data: (202) 691-6555 * [email protected] * www.bls.gov/
ces
Media contact: (202) 691-5902 * [email protected]
the employment situation--february 2012
Nonfarm payroll employment rose by 227,000 in February, and the
unemployment ratewas unchanged at 8.3 percent, the U.S. Bureau of Labor
Statistics reported today.Employment rose in professional and
businesses services, health care and socialassistance, leisure and
hospitality, manufacturing, and mining.
Household Survey Data
The number of unemployed persons, at 12.8 million, was essentially
unchanged inFebruary. The unemployment rate held at 8.3 percent, 0.8
percentage point belowthe August 2011 rate. (See table A-1.)
Among the major worker groups, the unemployment rates for adult men
(7.7 percent),adult women (7.7 percent), teenagers (23.8 percent),
whites (7.3 percent), blacks (14.1 percent), and Hispanics (10.7
percent) showed little or no change in February.The jobless rate for
Asians was 6.3 percent, not seasonally adjusted. (See tablesA-1, A-2,
and A-3.)
The number of long-term unemployed (those jobless for 27 weeks and
over) was littlechanged at 5.4 million in February. These individuals
accounted for 42.6 percent ofthe unemployed. (See table A-12.)
Both the labor force and employment rose in February. The civilian
labor forceparticipation rate, at 63.9 percent, and the employment-
population ratio, at 58.6 percent, edged up over the month. (See table
A-1.)
The number of persons employed part time for economic reasons
(sometimes referredto as involuntary part-time workers) was essentially
unchanged at 8.1 million inFebruary. These individuals were working
part time because their hours had been cutback or because they were
unable to find a full-time job. (See table A-8.)
In February, 2.6 million persons were marginally attached to the
labor force,essentially unchanged from a year earlier. (The data are
not seasonally adjusted.)These individuals were not in the labor force,
wanted and were available for work,and had looked for a job sometime in
the prior 12 months. They were not counted asunemployed because they
had not searched for work in the 4 weeks preceding thesurvey. (See
table A-16.)
Among the marginally attached, there were 1.0 million discouraged
workers inFebruary, about the same as a year earlier. (The data are not
seasonally adjusted.)Discouraged workers are persons not currently
looking for work because they believeno jobs are available for them.
The remaining 1.6 million persons marginally attachedto the labor force
in February had not searched for work in the 4 weeks precedingthe
survey for reasons such as school attendance or family
responsibilities. (Seetable A-16.)
Establishment Survey Data
Total nonfarm payroll employment rose by 227,000 in February.
Private-sector employmentgrew by 233,000, with job gains in
professional and business services, health care andsocial assistance,
leisure and hospitality, manufacturing, and mining. (See table B-1.)
Professional and business services added 82,000 jobs in February.
Just over half ofthe increase occurred in temporary help services
(+45,000). Job gains also occurred incomputer systems design (+10,000)
and in management and technical consulting services(+7,000). Employment
in professional and business services has grown by 1.4 millionsince a
recent low point in September 2009.
Health care and social assistance employment rose by 61,000 over
the month. Withinhealth care, ambulatory care services added 28,000
jobs, and hospital employmentincreased by 15,000. Over the past 12
months, health care employment has risen by360,000. In February, social
assistance employment edged up (+12,000).
In February, employment in leisure and hospitality increased by
44,000, with nearly allof the increase in food services and drinking
places (+41,000). Since a recent low inFebruary 2010, food services has
added 531,000 jobs.
Manufacturing employment rose by 31,000 in February. All of the
increase occurred indurable goods manufacturing, with job gains in
fabricated metal products (+11,000),transportation equipment (+8,000),
machinery (+5,000), and furniture and relatedproducts (+3,000). Durable
goods manufacturing has added 444,000 jobs since a recenttrough in
January 2010.
In February, mining added 7,000 jobs, with most of the gain in
support activities formining (+5,000). Since a recent low in October
2009, mining employment has increasedby 180,000.
Construction employment changed little in February, after 2
consecutive months of job gains. Over the month, employment fell by
14,000 in nonresidential specialty tradecontractors.
Overall, employment in retail trade changed little in February. A
large job loss ingeneral merchandise stores (-35,000) more than offset
an increase in January (+23,000).Employment in motor vehicle and parts
dealers continued to trend up in February.
Government employment was essentially unchanged in January and
February. In 2011,government lost an average of 22,000 jobs per month.
The average workweek for all employees on private nonfarm payrolls
was unchanged at 34.5 hours in February. The manufacturing workweek
edged up by 0.1 hour to 41.0 hours,and factory overtime was unchanged
at 3.4 hours. The average workweek for productionand nonsupervisory
employees on private nonfarm payrolls edged up by 0.1 hour to
33.8hours. (See tables B-2 and B-7.)
In February, average hourly earnings for all employees on private
nonfarm payrolls roseby 3 cents, or 0.1 percent, to $23.31. Over the
past 12 months, average hourly earningshave increased by 1.9 percent.
In February, average hourly earnings of private-sectorproduction and
nonsupervisory employees rose by 3 cents, or 0.2 percent, to
$19.64.(See tables B-3 and B-8.)
The change in total nonfarm payroll employment for December was
revised from +203,000to +223,000, and the change for January was
revised from +243,000 to +284,000.
______
Chairman Kline. Without objection.
Ms. Woolsey [continuing]. So that it is clear we already
have that information. Thank you.
And then I also need, before I talk to our wonderful
secretary of labor, clear up something that the gentleman from
Michigan, Mr. Walberg, stated that he has--that we have
corrected once and we need to correct again, and that is the
Rand report about the costs of prevention for our workers. The
Rand draft did not say--and Rand has corrected this--they did
not say anything about it costing more; in fact, they said when
inspectors investigate further and found failures to comply
with provisions to train workers to identify and abate hazards
and investigated injury causes the average injury rate at
targeted businesses declined more than 20 percent. The cost did
not go up; the cost went down. So we need to keep reminding the
other side of the aisle that that is exactly what is happening.
Madam Secretary, thank you for being here and I think we
have been amiss in not saying to you how we were thinking of
you during your loss when--the loss of your father who was so
proud of you and had every right to be, and you just added to
that today.
My question is about OSHA, and we have a backlog of over
2,000 whistleblower investigations. Some have been in line and
languishing for 2.5 years. And since whistleblowers are
actually proven to be essential to our society in protecting
lives and property, because of fear of losing their jobs they
don't always come forward and--like at the Upper Big Branch
miners were afraid to call MSHA about unsafe conditions, that
Enron accountants were afraid to report the Ponzi scheme until
it was too late and billions in retirement savings were lost,
and we all know that if big rig drivers are afraid to refuse to
drive trucks that have unsafe brakes we are all in jeopardy.
So I ask you, in this year of--whether our OSHA's budget,
which has stayed flat but has proposed an increase of $5
million for the whistleblowers, is this enough? Are we going to
be able to serve the needs of the whistleblowers? And would you
like to expand on that?
Secretary Solis. Thank you, Congressman Woolsey. I know
that this is of great interest to you and OSHA, I think, has
done a tremendous job, given our budget situation. And you are
correct in saying that our fiscal 2013 request for $565 million
is up a bit, thank goodness, but our request obviously--you
know, the focus is on expanding our responsibilities that you
all gave us--that the Congress laid out for us in terms of
providing help for the whistleblower program, and every--I
mean, there have been changes in that and we definitely needed
more support to help with the regulations and also enforcement.
The GAO report stated that very clearly and we know that we
have an obligation, and that is why we moved forward in
actually putting the responsibility of the whistleblower
programs under--directly under Dr. David Michaels, of OSHA, so
that we could help elevate and make it an important area and
function of the Department of Labor.
Ms. Woolsey. Is there a cost to not supporting the
whistleblowers?
Secretary Solis. Well obviously, I mean, you outlined some
of those already. And they are detrimental, and in many cases
if you don't act on these cases right away you can lose the
ability to do your investigation and go through the litigation
process. And of course, the harmful effects and also the
adverse effects that some employees go through, being harassed
and going through a whole slew of bad activity that occurs once
they do come forward and make a complaint.
So we know we have an obligation. I feel very strongly
about this. I know this committee does and I know members on
your side of the aisle have been very important in helping us
to structure this program.
Ms. Woolsey. Thank you very much.
Thank you----
Chairman Kline. The gentlelady's time has expired.
Mr. Goodlatte?
Mr. Goodlatte. Thank you, Mr. Chairman.
Madam Secretary, welcome.
Secretary Solis. Thank you.
Mr. Goodlatte. We are glad you are here today. I would like
to follow up on some questions about OSHA, as well.
Yesterday OSHA published its Global Harmonization
Regulation. Can you tell us what, quote--``hazards not
otherwise classified,'' means in this regulation?
Secretary Solis. Well, this is an exciting announcement
that was made yesterday, and I was very proud to be able to do
this because this is exactly what the president has been asking
us to do is to help to harmonize and bring criteria together.
This has been an ongoing process now, as you know. It is not
easy to get different countries to come together, and----
Mr. Goodlatte. I understand, but when you try to bring
people together if you want to accomplish something you have
got to have an understanding of what it is, and one of the
catch-all phrases in that so-called Global Harmonization
Regulation is ``hazards not otherwise classified.'' How are
employers to quantify this in order to comply with the
regulation? How will they know what ``hazards not otherwise
classified'' means?
Secretary Solis. Well, my understanding is that what we are
trying to do is make sure that employers and employees, more
respectively, are aware that when there are chemicals, as an
example, that are harmful, that we have a system that actually
provides better harmonization of how you articulate and explain
that to a worker, say, from another country----
Mr. Goodlatte. I understand the objective, but I don't know
how you get to that objective if you categorize something as
``hazards not otherwise classified.'' How do you know what they
are? How do you know how to structure your business operation
to avoid hazards that are not identified and are not
classified?
Secretary Solis. We hadn't heard many individuals that were
opposed to this. In fact, I would say the industry--in
particular, the chemical industry--Dow and others--came forward
and many in chamber of commerces around the country were also
supportive of this particular rule. So it is something that has
been being worked on now for several years. So this is
something that I know has been out there for some time, so I am
reluctant to give you any more information other than I will
make available my OSHA assistant secretary to clarify for you--
--
Mr. Goodlatte. It would be helpful if you could help to
clarify the meaning of that phrase.
Another OSHA issue, a little over a week ago OSHA issued a
memorandum to field enforcement personnel that was critical of
employer safety incentive programs, which I would think are a
good thing. Currently there is no law or regulation forbidding
the use of these programs. Does OSHA intend to start issuing
citations to employers that use employer safety incentive
programs?
Secretary Solis. No. You know, we typically--when there is
an investigation it is because there has been an inquiry.
Someone has actually called to ask for us to go out there. So I
would say that that is what we are attempting to do.
Mr. Goodlatte. But if an employer is using an employer
safety incentive program to try to encourage safety in the
workplace you are not intending to issue citations
notwithstanding the fact that a memorandum was sent out to
field personnel just 8 or 9 days ago criticizing----
Secretary Solis. I don't know about that particular case,
but I will certainly ask the--my assistant secretary to respond
to you. But typically there are businesses that are involved in
our compliance programs--there are VVP programs as they are
noted--and many cases some employers fall behind and that may
have been what happened here and someone may have lodged a
complaint and said, ``Well, they are not really keeping up to
par with what the program said that they should be at.'' So
that is--it may have happened. I don't know, but I will get
back to you on----
Mr. Goodlatte. That also would be helpful if the committee
could be informed about what was intended by a memorandum that
criticized these programs.
Lastly, let me ask you about an issue that the subcommittee
I serve on held a hearing on yesterday, and that is related to
the DOL's proposed rule on companionship services. As you know,
the Office of Management and Budget's circular A-4 requires the
Department of Labor to examine the proper extent of state and
local discretion in the rulemaking context and to consider
alternatives such as leaving regulatory issues to state and
local authorities.
In the context of companion care these are extremely
important considerations, given that states can differ greatly
in how they regulate care and reimburse for care under
government-funded programs such as Medicaid. To what extent did
DOL consider the fact that the rule would preempt the states'
ability to design regulations to its local care market? Did the
department consider the advantages of leaving the regulation of
care to state and local authorities under OMB circular A-4, and
if not, what assurances can you give the committee that you
will take these concerns into consideration moving forward? We
had a very good hearing yesterday on which----
Secretary Solis. Right.
Mr. Goodlatte [continuing]. A lot of concerns were raised
about this initiative by the department.
Chairman Kline. The gentleman's time has expired, but we
would appreciate an answer in writing on that.
Secretary Solis. Sure.
Chairman Kline. It is an issue that has been raised again
and again, as you know, Madam Secretary, this morning. I
appreciate the gentleman from Virginia raising it, and we
really would like some more feedback. A lot of concern
yesterday in the subcommittee hearing and today.
Mr. Tierney?
Mr. Tierney. Thank you, Mr. Chairman.
Thank you, Madam Secretary. It is nice to see you here
again.
First, I want to start off by thanking you and your staff.
As you know, Mr. Miller, Mr. Hinojosa, and I were working on
the Workforce Investment reauthorization and we received a lot
of very valuable technical assistance and advice, and we do
appreciate that significantly on that basis. We are interested
in so many different things in that bill, but a number of which
I think sort of overlap with some direction from the White
House and from your office, as well, particularly the Community
College and Career Fund. I wonder if you will talk a little bit
more about that specific piece that happens to be in our bills
as well, but what you anticipate from it and how it will help
people as they get back to work.
Secretary Solis. Congressman Tierney, maybe before you
walked in the room I spoke about the TAA Community College Fund
that has now been in existence, and we are now at the second
portion or part of the phase. We are now going to be rolling
out the other $500 million. We have already rolled out $500
million. Those grants went all over the state. Some states
competed very well in consortiums, and I know your state did
very well and so did the state of California, I might add.
But also, what we are doing there is really looking at
things in terms of innovation, but I like to say innovation-
slash-reform, because we are really asking community colleges
to step up to the plate and not just teach for the sake of
teaching but teach for a credential, or a license, or whatever
it might be that would actually lead to the job. So now we are
asking for measures of that, and that is what I think is
different about this new program that the president has talked
about. He is willing to put aside funding for K-12--$4
billion--and $4 billion for community colleges.
The same things that we have learned in the TAA Community
College program will be applied but on a broader scale, and we
found some very good evidence to show that we are actually
seeing more investments in manufacturing, in I.T., in health
care, and industries where we--we actually need to continue to
have people getting into jobs like welding, like
apprenticeships, because we are finding that there is a big
shortage in manufacturing of those very highly skilled
individuals--journeymen, as an example. I know you and I share
our concern for some of these jobs that are out there but there
is a great need to have a continual pool of people that are
cycling into these kinds of jobs.
Mr. Tierney. Well, we have such a variance just in my
district alone, as you know--everything from the type of job
you just described also to very technically oriented jobs,
whether it is in the health care field and technology there,
and radiology technicians, right on down the line. We have a
program in Lynn in the GE site, obviously which brings in high
precision----
Secretary Solis. Right.
Mr. Tierney [continuing]. Manufacturing on that, and----
Secretary Solis. And your bill talks about sectors----
Mr. Tierney. Sectors.
Secretary Solis [continuing]. And that is exactly what we
have been able to do with the TAA Community College Fund. So we
know that it works. I mean, I am very excited to see that you
and your colleagues here, but also in the Senate, have the--the
same kind of idea or concept that we need to be looking to push
out incentives to regionalize and look at sectors that are
growing and help to incentivize that.
And right now, as you know, many of our states are
strapped. They are cutting their education budgets. So this is
a shot in the arm for many of those programs that have been
stagnant, especially in manufacturing, in bioindustry, in I.T.,
and health care.
Mr. Tierney. Well, so much has changed since 1998 when we
first did this law and the types of new industries that weren't
even thought of at the time, so the flexibility that we are
trying to provide in the bill, and we received help with as
well, in allowing people to go to a new area and then be
flexible. Yesterday we spoke with one employer in my district
while we were on a conference who used some of the resources to
actually train incumbent workers----
Secretary Solis. Right.
Mr. Tierney [continuing]. Because he was losing his
business and he shifted from doing high precision medical
devices and other types of work to the aerospace type of
industry. And with the assistance of the workforce investment
board partnering with a provider like the community college
moving on that he was able to get his people certified and
credentialed and now half his business is in that area. He
would have had to lay those people off and move in a different
direction.
So your office is helping and helping us grapple with the
innovation idea, the idea of being flexible on that, the
partnershipping in the sectors. All of that, I think, is
important, and no less so than the accountability aspect on
that.
And I just wanted to wrap up by--I wish Ms. Foxx was still
here because my information is some 162,458 jobs, if you want
to be exact, adults received training services, which I think
is a pretty incredible number. And 69.6 percent--70 percent--
actually entered employment the first quarter after that. That
is a marked fact that we could give Ms. Foxx and she could take
it home. The same thing--almost 130,000 Americans got training
services through WIA Dislocated Workers Program, and well over
66 percent of those got jobs.
So those are the kind of metrics that we want to be able to
show on a regular basis, and unless we can show them we won't
be able to continue the program and shouldn't.
Secretary Solis. Right.
Mr. Tierney. So the whole idea is the accountability
wrapped in with the other aspects we talked about. I want to
thank you for your work and your staff, again, for their great
work.
Secretary Solis. Thank you. Thank you.
Chairman Kline. I thank the gentleman.
Looks like all members have had an opportunity to ask
questions. I certainly want to thank the secretary for being
here with us today and giving so much of your time. I would
like to recognize Mr. Miller for any closing remarks he may
have?
Secretary Solis. Thank you.
Chairman Kline. I thank the gentleman.
And again, Madam Secretary, thank you. This was a hearing
about the president's budget and particularly about the
Department of Labor's portion of that budget.
I do want to note that just a moment ago in responding to
Mr. Tierney you pointed out that many states were strapped. I
would argue that the federal government is strapped as well,
and the president's budget reflecting, again, another $1
trillion deficit, so when we talk about setting aside billions
for in many cases new programs many of us have a concern. We
appreciate your addressing those concerns and we will continue
the dialogue as we go forward.
Again, thank you very much for being with the committee
today.
There being no further business, the committee stands
adjourned.
[Additional submission of Mr. Miller follows:]
U.S. Congress,
Washington, DC, March 21, 2012.
Hon. John Kline, Chairman,
Committee on Education and the Workforce, 2181 Rayburn House Office
Building, Washington, DC 20515.
Dear Chairman Kline: I am pleased to report that the House
Democratic Caucus has assigned Congresswoman Marcia Fudge to the
Education and the Workforce Committee. Congresswoman Fudge will be
joining the Subcommittee on Early Childhood, Elementary, and Secondary
Education and the Subcommittee on Workforce Protections. With her
addition, the composition of the subcommittees should be as follows:
subcommittee on early childhood, elementary, and secondary education
Dale E. Kildee, Michigan
Ranking Minority Member)
Robert C. ``Bobby'' Scott, Virginia
Carolyn McCarthy, New York
Rush D. Holt, New Jersey
Susan A. Davis, California
Raul M. Grijalva, Arizona
Mazie K. Hirono, Hawaii
Lynn C. Woolsey, California
Marcia Fudge, Ohio
subcommittee on workforce protections
Lynn C. Woolsey, California
(Ranking Minority Member)
Dennis J. Kucinich, Ohio
Timothy H. Bishop, New York
Mazie K. Hirono, Hawaii
George Miller, California
Marcia Fudge, Ohio
If you have any questions, please contact me or direct your staff
to contact Megan O'Reilly at 202-225-3725.
Sincerely,
George Miller,
Senior Democratic Member.
______
[Additional submissions of Secretary Solis follow:]
[The Bureau of Labor Statistics Jan. 6, 2012, news release
may be accessed at the following Internet address:]
http://www.bls.gov/news.release/archives/empsit_01062012.pdf
______
[The Bureau of Labor Statistics Feb. 3, 2012, news release
may be accessed at the following Internet address:]
http://www.bls.gov/news.release/archives/empsit_02032012.pdf
______
[The Bureau of Labor Statistics Mar. 9, 2012, news release
may be accessed at the following Internet address:]
http://www.bls.gov/news.release/archives/empsit_03092012.pdf
______
[Additional submission of Mrs. Roby follows:]
------
[Questions submitted for the record and their response
follows:]
U.S. Congress,
Washington, DC, May 18, 2012.
Hon. Hilda L. Solis, Secretary,
U.S. Department of Labor, 200 Constitution Avenue, NW, Washington, DC
20210.
Dear Secretary Solis: Thank you for testifying at the Committee on
Education and the Workforce's March 21, hearing on ``Reviewing the
President's Fiscal Year 2013 Budget Proposal for the U.S. Department of
Labor.'' I appreciate your participation.
Enclosed are additional questions submitted by Committee members
following the hearing. Please provide written responses that answer the
questions posed no later than June 1, 2012, for inclusion in the
official hearing record. Responses should be sent to Benjamin Hoog of
the Committee staff, who can be contacted at (202) 225-4527.
Thank you again for your contribution to the work of the Committee.
Sincerely,
John Kline,
Chairman.
Enclosures.
QUESTIONS FOR THE RECORD SUBMITTED BY CHAIRMAN JOHN KLINE
1. The committee has received inquiries regarding the Department of
Labor's treatment of discretionary ``tips'' included on an invoice for
ground transportation services as wage income. The committee
understands there is some disagreement between the department and the
ground transportation industry about whether such monies are non-
discretionary. As such, under the Fair Labor Standards Act, the
department has held the view that such amounts are ``imposed
gratuities,'' not ``tips,'' and classifies that income as wages subject
to overtime.
The committee understands that ground transportation
representatives have met with the department and requested a formal
Administrative Interpretation to resolve this matter. At DOL's request,
the ground transportation industry advanced an industry-standard
practice whereby the recommended tip amount is negotiated between the
transportation provider and the customer, varies, is at the sole
discretion of the customer, and is paid to the driver in full. Under
this practice, and consistent with 29 CFR 531.52-53 and past Opinion
Letters, the ground transportation representatives urged the department
to classify those voluntary amounts received by operators as ``tips,''
not ``imposed gratuities.'' The committee understands that, as outlined
above, the Houston field office agreed and views such amounts as
``tips'' and not ``imposed gratuities.''
What is the status of the ground transportation operators' request
for an Administrative Interpretation?
2. Stakeholders who regularly use the H-2A program have expressed
their concern that in recent years the Wage and Hour Division has
conducted a disproportionate number of audits of employers who utilize
the H-2A program compared to employers who do not. Please provide a
list of audits from FY 2007 to FY 2011 for investigations undertaken by
the Wage and Hour Division in the agriculture industry, including the
number of investigations involving H-2A compliance, and the number of
investigations involving compliance under the Migrant and Seasonal
Agricultural Worker Protection Act.
3. More than a year ago the president signed an executive order
directing federal agencies to undertake a review of their regulations.
The president indicated his belief that reviewing, modifying, and
repealing regulations would ``promote economic growth, innovation,
competitiveness, and job creation.'' Currently, DOL is responsible for
implementing close to 200 federal laws. How many regulations are
currently in force at DOL to implement those laws? Provide an estimate
of the net annual cost of these regulations. In 2011, when DOL reviewed
its regulations, 11 were identified for modification, but no
regulations were identified for repeal. What regulations has DOL
identified for modification or repeal in 2012?
4. The Employment and Training Administration claims it served more
than 9.8 million individuals in the last program year. We have seen
several articles about workers, including many in the green jobs
industry, who receive training services but can't find employment in
their chosen field. Of the 9.8 million individuals, how many people
actually received job training? How many were placed into jobs related
to that training? If a worker receives training but finds a low-paying
job in another field, how is that worker counted on the program's
performance measures?
5. While the FY 2013 budget and the president's recent announcement
includes a modest consolidation proposal saving $16 million, the
administration wants to create several new job training programs
costing taxpayers approximately $20 billion in new spending. Instead of
working to simplify the 47 job training programs identified by GAO, the
administration's plan would cause more confusion for unemployed workers
struggling to navigate the maze of programs created at the federal
level. Why has the administration chosen to further complicate the
nation's job training system?
6. The administration's proposal to consolidate Trade Adjustment
Assistance (TAA) with the Workforce Investment Act's Dislocated Worker
program into a new Displaced Worker program seemed to be a step in the
right direction. However, as more details are learned, it seems to be
less about streamlining the maze of confusing job training and more
about dramatically expanding federal subsidies. When will the
administration release its legislative proposal to Congress? How much
will the new program cost taxpayers? Is the new program being funded
out of mandatory or discretionary funds? Will privately contracted One-
Stop staff be prohibited from administering the program as is the case
under TAA? How will the new program work within the existing federal
workforce investment system?
7. In 2011 and 2012, Congress provided approximately $150 million
to the Department of Labor for a new Workforce Innovation Fund. This
fund sounds eerily similar to the Race to the Top program operated by
the Department of Education--a slush fund created outside the
Congressional authorization process with few parameters around how the
money should be spent. How is the department implementing the new
program? How much money has been spent on the program already? The day
following this hearing, March 22, 2012, the first solicitation closed.
Why has it taken more than a year and half to get the program up and
running?
8. One of the goals of the new Workforce Innovation Fund is to
develop new service delivery services and processes to improve outcomes
for workers in the job training system. These activities aren't new--
they mirror what state and local workforce investment boards do every
day and reflect the fundamental mission of the programs authorized
under the Workforce Investment Act. How is this program different from
initiatives currently being funded? How will the department ensure
these new programs are not duplicating efforts already underway?
QUESTIONS FOR THE RECORD SUBMITTED BY REPRESENTATIVE VIRGINIA FOXX
1. During your recent testimony before the committee, you stated
that the department has rigorous evaluations for all programs. Please
provide copies of these evaluations as well as the results (specific
numbers) the participants in the programs received in obtaining
employment, increasing their wages, and receiving a job in the field
they were trained.
2. The president's FY 2013 request proposes a new $8 billion
Community College to Career Fund, which is in part based on a similar
program, the Trade Adjustment Assistance Community College and Career
Training Grant Program (TAACCCTG). Please provide an evaluation of the
TAACCCTG program and the results (specific numbers) it has achieved in
helping individuals obtain degrees and credentials for high-skill
occupations.
QUESTIONS FOR THE RECORD SUBMITTED BY REPRESENTATIVE TODD ROKITA
1. In response to a rule proposed by your department on March 18,
2011, that has since been finalized which would alter the H2B program,
the Small Business Administration Office of Advocacy noted that the
``rule creates numerous administrative burdens and compliance costs,''
``underestimates compliance costs, and fails to analyze the cumulative
impact of [the rule's] requirements,'' and urged ``DOL to consider
significant alternatives to this proposed rule recommended by small
entities that would meet the agency's objectives without jeopardizing
small businesses.''
The rule was finalized anyway. How did your department justify this
rule in light of SBA's concerns?
2. In response to a rule proposed by your department on March 18,
2011, that has since been finalized which would alter the H2B program,
the Small Business Administration Office of Advocacy noted that DOL's
Initial Regulatory Flexibility Analysis was inadequate because it
failed to properly evaluate the number of small businesses impacted by
the rulemaking, underestimated the economic impact of the rule on small
businesses and did not discuss significant alternatives that may have
minimized the impact of the rule on small businesses.
Did DOL subsequently perform a proper Initial Regulatory
Flexibility Analysis as it is legally required to do?
3. Madame Secretary, your department recently finalized two rules
that will alter the H2B program. Thousands of small businesses
throughout the country have made it clear that those rules are a threat
to them and their full-time employees. Even the SBA opposed the rules
and noted that your department did not adequately study the impact of
the rules as it is required to do by law.
Can you tell me how many existing full-time jobs these rules will
either eliminate or threaten?
4. Madame Secretary, on January 18, 2011, President Obama issued a
presidential memorandum which expressed his administration's commitment
to eliminating excessive and unjustified burdens on small businesses.
However, the very next day your department issued a new rule that
dramatically inflated the cost of the using the H2B program. In fact,
Congress blocked the rule because there was so much concern about it.
Recently your department issued another rule that thousands of small
businesses throughout the country as well as the Small Business
Administration consider highly excessive and unjustifiably burdensome.
How can your department's new rules be consistent with the stated
intent of the presidential memorandum?
5. Madame Secretary, your department recently finalized two rules
that will alter the H2B program. I understand that one of the rules is
the subject of two lawsuits which claim that the law states that
authority to issue rules lies with the Department of Homeland Security
and that the Department of Labor only acts in an advisory role to DHS
with no rulemaking authority over the program.
Can you tell me specifically where the statute is that states that
DOL has rulemaking authority over the H2B program?
6. Madame Secretary, your department recently finalized two rules
that will alter the H2B program. I understand that one of the rules is
the subject of two lawsuits and that one of the claims against the rule
states that your department did not take employer interest into account
when the rules were promulgated as it is supposed to do.
Did your department take into consideration employer interest in
issuing these rules and if so, in what way specifically?
QUESTIONS FOR THE RECORD SUBMITTED BY REPRESENTATIVE LYNN WOOLSEY
In my District, I have seen firsthand the value of life-saving and
life-renewing services offered by community-based nonprofits that
provide residential treatment for substance use disorder. They treat
addiction first and foremost, but also help reintegrate people into
society.
1. How is the Department supporting ex-offender reentry through its
programs and the resources it makes available to the states?
2. Understanding that drug and alcohol treatment centers do not
deploy the traditional One Stop Career Center model, when considering
how to deal with re-entry, it seems sensible that the Department of
Labor would tailor the program to work with groups that specialize in
dealing with ex-offenders. Has the Department considered these benefits
when thinking of ex-offender re-entry, and how can these rehabilitation
centers work with the Department to provide job training services, on
their own or with One-Stop Centers?
QUESTIONS FOR THE RECORD SUBMITTED BY REPRESENTATIVE MARCIA FUDGE
1. Community based organizations (CBOs,) both private and non-
profit, possess firsthand knowledge and experience implementing
effective and successful workforce development measures to meet the
needs of the unemployed, especially the long-term unemployed and
individuals with multiple barriers to employment. Because of this, CBOs
must not be relegated to the role of service providers only, CBOs must
also be included in policy discussions. CBOs are an integral and
effective component of our nation's workforce development system. CBOs,
especially minority-serving CBOs, represent the perspective and needs
of diverse populations including African American, Hispanic and other
people of color.
What efforts has the Department of Labor undertaken to ensure
minority community based organizations receive equitable representation
on state and local Workforce Investment Boards (WIBs,) or other local
governing mechanisms that may be established by WIA, where policy and
programmatic decisions are made?
What efforts has the Department of Labor undertaken to ensure
community based organizations, of demonstrated effectiveness, are
included as an integral and effective component of our nation's
workforce development system and its evolving partnership with
community colleges?
How has the Department of Labor enforced conflict of interest
provisions to prevent Workforce Investment Boards from functioning as
direct service providers?
2. Urban communities need community based organizations, like the
National Urban League, to be supported by the Federal Government. Their
innovative and culturally competent programs are operated by local
community leaders who have lived and worked in the communities they
serve for many years. As the economy slowly gains steam, it is clear
that we cannot recover without targeted measures to address
unemployment in the hardest-hit communities. We congratulate groups
like the National Urban League for recognizing what needs to be done
every day on the front lines and fighting for the communities we
represent.
What efforts has the Department of Labor undertaken to encourage
partnerships with national community based organizations that have been
anchors in urban communities? Can you share any lessons the Department
has learned about what the government can do to encourage such
partnerships?
______
[Secretary Solis' response to questions submitted follows:]
QUESTIONS FOR THE RECORD SUBMITTED BY CHAIRMAN JOHN KLINE
1. The committee has received inquiries regarding the Department of
Labor's treatment of discretionary ``tips'' included on an invoice for
ground transportation services as wage income. The committee
understands there is some disagreement between the department and the
ground transportation industry about whether such monies are
nondiscretionary. As such, under the Fair Labor Standards Act, the
department has held the view that such amounts are ``imposed
gratuities,'' not ``tips,'' and classifies that income as wages subject
to overtime.
The committee understands that ground transportation
representatives have met with the department and requested a formal
Administrative Interpretation to resolve this matter. At DOL's request,
the ground transportation industry advanced an industry-standard
practice whereby the recommended tip amount is negotiated between the
transportation provider and the customer, varies, is at the sole
discretion of the customer, and is paid to the driver in full. Under
this practice, and consistent with 29 CFR 53 1.52-53 and past Opinion
Letters, the ground transportation representatives urged the department
to classify those voluntary amounts received by operators as ``tips,''
not ``imposed gratuities.'' The committee understands that, as outlined
above, the Houston field office agreed and views such amounts as
``tips'' and not ``imposed gratuities.''
What is the status of the ground transportation operators' request
for an Administrative Interpretation?
The Department received a request from the National Limousine
Association (NLA) for guidance on whether service fees charged to
companies and individuals who contract for transportation services
constitute tips under the Fair Labor Standards Act (FLSA). The NLA
specifically requested an Administrator Interpretation. The Wage and
Hour Division (WHD) has agreed to engage the NLA in additional
discussions about these practices and whether these service charges
constitute a tip.
The WHD issues formal guidance through a variety of means
including: Administrator Interpretations, Field Assistance Bulletins,
Fact Sheets, and FAQs. The Division's national office and regional
office staff also regularly provide assistance and guidance to
individual employees, employers, or their representatives by discussing
with and/or referring the requester to the applicable statutory and
regulatory provisions and the guidance documents listed above. The WHD
has met with the NLA and during the meeting discussed and directed the
association to the Division's existing and longstanding guidance on the
issue of the application of the FLSA's tip credit provisions to service
fees charged customers by employers.
The WHD has continued its discussions with the NLA and last met
with its representatives on June 14, 2012. Based on these discussions
and additional information provided, the WHD is considering if the
practices as described by the NLA are compliant with the FLSA. Once the
WHD has had the opportunity to fully consider the information provided
by the NLA, the WHD position on whether and under what circumstances
the service charges levied by the transportation companies may be
considered gratuities under the FLSA will be communicated to the NLA.
2. Stakeholders who regularly use the H-2A program have expressed
their concern that in recent years the Wage and Hour Division has
conducted a disproportionate number of audits of employers who utilize
the H-2A program compared to employers who do not. Please provide a
list of audits from FY 2007 to FY 2011 for investigations undertaken by
the Wage and Hour Division in the agriculture industry, including the
number of investigations involving H-2A compliance, and the number of
investigations involving compliance under the Migrant and Seasonal
Agricultural Worker Protection Act.
Workers who are engaged in labor intensive agricultural employment
are among the most vulnerable workers in today's workplace. The pay is
typically low, the work is arduous, and the conditions often harsh.
Farm workers simply do not file complaints with the Department when
they are faced with adverse, and often illegal, working conditions.
Consequently, the WHD has long maintained a directed or targeted
enforcement program in this industry.
The agency protects farm workers through enforcement of the FLSA,
the Migrant and Seasonal Agricultural Worker Protection Act (MSPA), the
field sanitation provisions under the Occupational Safety and Health
Act (OSH Act), and through the enforcement of the H-2A temporary
agricultural worker provisions of the Immigration and Nationality Act
(INA). When Wage and Hour investigators conduct an investigation of an
agricultural employer, whether a fixed-site farm or a farm labor
contractor, they investigate compliance with all applicable statutes
that provide protections for farm workers. While an investigation may
be initiated under one statute, e.g., MSPA, the investigator will
examine compliance with FLSA, OSH Act, and the H-2A provisions within
the INA, if applicable to that employer. WHD's data system captures the
``registration Act,'' which is generally the statute under which the
investigation was initiated. WHD's data system also captures the
``violation Act'' (statute under which a violation was found), and this
may include multiple statutes under a single case. The following chart
provides a sum of all agricultural investigations conducted in each
fiscal year beginning with FY 2007. It also provides the number of
cases registered as an H2A case and those registered as a MSPA case.
Because a MSPA registered investigation may result in an H-2A violation
if the employer utilizes H-2A workers, the chart also provides the
number of cases in which H-2A or MSPA violations were found.
----------------------------------------------------------------------------------------------------------------
FY2007 FY2008 FY2009 FY2010 FY2011
----------------------------------------------------------------------------------------------------------------
Agriculture:
All Cases in the Agricultural Industry\1\...................... 1,667 1,600 1,323 1,259 1,527
Agriculture Investigations by Registration Act:
Cases Registered as H-2A....................................... 110 159 165 135 240
Cases Registered as MSPA....................................... 1,426 1,356 1,107 1,005 1,035
Agriculture Investigations by Violation Act Regardless of
Registration Act:
Cases with H-2A Violations..................................... 101 117 128 108 180
Cases with MSPA Violations..................................... 867 776 667 670 700
----------------------------------------------------------------------------------------------------------------
\1\ Some agriculture industry investigations may be registered as Fair Labor Standards Act cases.
3. More than a year ago the President signed an executive order
directing federal agencies to undertake a review of their regulations.
The President indicated his belief that reviewing, modifying, and
repealing regulations would ``promote economic growth, innovation,
competitiveness, and job creation.'' Currently, DOL is responsible for
implementing close to 200 federal laws. How many regulations are
currently in force at DOL to implement those laws? Provide an estimate
of the net annual cost of these regulations. In 2011, when DOL reviewed
its regulations, 11 were identified for modification, but no
regulations were identified for repeal. What regulations has DOL
identified for modification or repeal in 2012?
The nature of regulations, their promulgation and revision do not
lend themselves to a numerical count. However, the regulations that the
Department of Labor currently enforces include those contained in four
CFR titles and many accompanying subparts. Please see chart below.
In accordance with the requirements of Executive Orders 12866
(Regulatory Planning and Review) and 13563 (Improving Regulation and
Regulatory Review), the Department designs its regulations to be
flexible, cost-effective, maximize benefits, and impose the least
possible burdens. The Department strives to ensure that the benefits of
its various regulations exceed the costs whenever possible.
In compliance with Section 610 of the Regulatory Flexibility Act,
E.O. 12866, and E.O. 13563, the Department's agencies regularly conduct
retrospective analysis of their regulations to identify those that are
outmoded, require modification, are ineffective or should be expanded
or repealed. In 2012, the Department issued its Hazard Communications
final rule (3/26/12) and updated an OSHA standard based on National
Consensus Standards for Acetylene (3/8/12). The Department is currently
working on the remaining items previously identified for modification.
CODE OF FEDERAL REGULATIONS TITLES AND CHAPTERS
----------------------------------------------------------------------------------------------------------------
Title Chapter Parts DOL Regulatory Agency
----------------------------------------------------------------------------------------------------------------
Employees' Benefits
Title 20 I 1-199 Office of Workers' Compensation Programs
IV 500-599 Employees Compensation Appeals Board
V 600-699 Employment and Training Administration
VI 700-799 Office of Worker's Compensation Programs
VII 800-899 Benefits Review Board
IX 1000-1099 Veterans' Employment and Training Service
----------------------------------------------------------------------------------------------------------------
Labor
Subtitle A--Office of the Secretary of Labor
Title 29 0-99 Office of the Secretary of Labor
Subtitle B--Regulations Relating to Labor
II 200-299 Office of Labor--Management Standards
IV 400-499 Office of Labor--Management Standards
V 500-899 Wage and Hour Division
XVII 1900-1999 Occupational Safety and Health Administration
XX 2200-2499 Occupational Safety and Health Administration
XXV 2500-2599 Employee Benefits Security Administration
----------------------------------------------------------------------------------------------------------------
Mineral Resources
Title 30 I 1-199 Mine Safety and Health Administration
----------------------------------------------------------------------------------------------------------------
Public Contracts and Property Management
Subtitle B--Other Provisions Related to Public
Contracts
Title 41 50 50-1-50-999 Public Contracts
60 60-1-60-999 Office of Federal Contract Compliance Programs
61 61-1-61-999 Veterans' Employment and Training Service
----------------------------------------------------------------------------------------------------------------
4. The Employment and Training Administration claims it served more
than 9.8 million individuals in the last program year. We have seen
several articles about workers, including many in the green jobs
industry, who receive training services but can't find employment in
their chosen field. Of the 9.8 million individuals, how many people
actually received job training? How many were placed into jobs related
to that training? If a worker receives training but finds a low-paying
job in another field, how is that worker counted on the program's
performance measures?
In the 21st Century global economy, businesses and industries in
the United States must continually transform and innovate to remain
competitive. The Administration has invested in preparing the American
workforce for jobs in industries that will drive this economy,
including clean energy and health care.
For the four-quarter period ending June 30, 2011, 9.8 million
individuals were participants in one of the Employment and Training
Administration's (ETA) workforce programs (excluding the Wagner-Peyser
Employment Service and Unemployment Insurance), as reported in ETA's
quarterly Workforce System Results. For the same time period (June 30,
2011), about 2.6 million individuals were reported by states and
grantees as program completers (exiters). All ETA program performance
measures and outcomes are derived based on exiters, as many of the
outcome components occur after program completion. Therefore, the total
number of exiters is provided for a better comparison. Additionally,
the total participant count includes self-service participants (those
who may receive services virtually or access services with little or no
staff assistance), whereas these self-service participants are excluded
from performance outcomes (except for the Employment Service) as well
as counts of those who received training services.
ETA's entered employment measure is primarily calculated via an
automated match to state wage records. If a worker has received wages
in the first quarter after program completion and is thus ``found'' in
the wage record file, this person is considered a positive outcome for
this measure regardless of occupation. In order to further validate
employment as it relates to the participant's training, some programs
conduct manual follow-up with the participant to verify if the
employment was related to the training received. However, with limited
resources and the inability to contact some participants who are no
longer receiving services, measures based on this sort of follow-up
will inevitably understate the number of participants in employment.
For the four-quarter period ending June 30, 2011, approximately
575,000 program completers (exiters) received training services. The
number of those receiving training services is influenced by the demand
of such services as well as the availability of resources for training.
Please see the attached chart for a break-out of program completer
(exiter) counts and entered employment outcomes by ETA workforce
programs.
5. While the FY 2013 budget and the President's recent announcement
includes a modest consolidation proposal saving $16 million, the
administration wants to create several new job training programs
costing taxpayers approximately $20 billion in new spending. Instead of
working to simplify the 47 job training programs identified by GAO, the
administration's plan would cause more confusion for unemployed workers
struggling to navigate the maze of programs created at the federal
level. Why has the administration chosen to further complicate the
nation's job training system?
We agree that there are opportunities to improve the current
system, and our 2013 Budget makes some changes to do just that. While
it is important to minimize duplication and maximize efficiency, we
believe that a coherent public workforce system does not necessarily
mean a single program, supplier, or agency. Our goal should be a
rational system whose elements fit together logically, with minimal
duplication, and provide ready and seamless access to services for
jobseekers and workers looking for skills development and to employers
looking for skilled workers. The Department is committed to better
alignment of Federal investments in job training and improving models
to deliver quality services across programs at lower cost.
The 2013 Budget eliminates some programs that overlap with other
services. For example, the Budget ends funding for the Women in
Apprenticeship in Non-Traditional Occupations (WANTO), whose important
mission of expanding apprenticeship opportunities for women can be met
through Labor's work to expand registered apprenticeships and ensure
equal access to apprenticeship programs. It also terminates the $15
million Veterans Workforce Investment Program (VWIP), instead
supporting service delivery innovations through the Workforce
Innovation Fund and continuing funding for other veterans' employment
programs.
The Administration's proposal also integrates different existing
programs providing services to similar populations to more effectively
help unemployed workers back to work. For example, President Obama
wants to help dislocated workers navigate multiple employment and
training programs, so that from now on, these individuals have one
program, one website, and one place to go for all the information and
help they need. The proposed Universal Dislocated Worker program would
replace the Trade Adjustment Assistance and WIA Dislocated Worker
program with a single, uniform set of services to help displaced
workers.
The Workforce Innovation Fund, for which the 2013 Budget proposes a
third year of funding, also encourages States and localities to
integrate services across programs and achieve more cost-effective
results. The Workforce Innovation Fund will support States and
localities that are coordinating across programs to more efficiently
achieve better outcomes for participants. Each grant will include an
evaluation component to identify effective practices that can be
replicated throughout the workforce system. The Budget again proposes
broader waiver authority that grantees could use to do bolder
experimentation across program silos.
The Administration also introduced efforts to improve coordination
among federal training and employment programs. The American Job Center
initiative is intended to improve the visibility and accessibility of
the one-stop system, so job-seekers and employers have a readily
identifiable physical and online place they can go to access the range
of services they need.
In some cases programs provide the same services and serve similar
populations but the overlap between the programs is minimal. For
example, WIA Adult and TANF overlap in terms of training and job search
services; and both serve disadvantaged adults, but only five percent of
those served by WIA Adult program are also served by TANF. As
recommended by the GAO report, the Departments of Labor and Health and
Human Services work together to conduct and publish research that
identifies best practices in WIA/TANF coordination. A study released in
July compiled information from 10 sites about WIA and TANF partnerships
that used Recovery Act funds to support youth employment. Another study
currently underway will look at exemplary cross-program coordination
models and the extent to which WIA services are provided to TANF
clients.
Together, this rational approach will provide ready access to
services for jobseekers and other workers looking for good jobs and to
employers looking for job-ready skilled workers who met their needs.
6. The administration's proposal to consolidate Trade Adjustment
Assistance (TAA) with the Workforce Investment Act's Dislocated Worker
program into a new Displaced Worker program seemed to be a step in the
right direction. However, as more details are learned, it seems to be
less about streamlining the maze of confusing job training and more
about dramatically expanding federal subsidies. When will the
administration release its legislative proposal to Congress? How much
will the new program cost taxpayers? Is the new program being funded
out of mandatory or discretionary funds? Will privately contracted One-
Stop staff be prohibited from administering the program as is the case
under TAA? How will the new program work within the existing federal
workforce investment system?
The Universal Displaced Worker (UDW) program would integrate proven
aspects of the current Trade Adjustment Assistance (TAA) for workers
and Workforce Investment Act (WIA) Dislocated Worker programs to
provide a universal core set of services to a broader number of
unemployed Americans. Combining these programs eliminates the complex
administrative process needed to determine why workers are dislocated.
The new, streamlined program would serve as many as 1 million workers
per year.
UDW will give displaced workers the support they need to reenter
the job market by providing:
Up to $8,000 in training vouchers over two years.
Stipends of $150 for up to 78 weeks for childcare,
transportation, and other expenses as individuals look for work or
build their skills through training.
Low-income workers are eligible for more generous
stipends.
Job search and relocation allowances of up to $1,250 per
worker.
Wage insurance for up to two years for workers over 50 who
have re-employment earnings of less than $50,000.
Guaranteed reemployment and case management services.
UDW will be a mandatory program for eligible displaced workers. The
program will cost an average of about $2.7 billion per year above the
current baseline. We expect that, as in the present WIA Dislocated
Worker system, One-Stop Career Center staff would provide various
reemployment services to UDW participants, and that the UDW program
would be a fully integrated partner in the workforce system.
The Department looks forward to working with Congress as we
continue to develop the UDW program and accompanying legislation.
7. In 2011 and 2012, Congress provided approximately $150 million
to the Department of Labor for a new Workforce Innovation Fund. This
fund sounds eerily similar to the Race to the Top program operated by
the Department of Education- a slush fund created outside the
Congressional authorization process with few parameters around how the
money should be spent. How is the department implementing the new
program? How much money has been spent on the program already? The day
following this hearing, March 22, 2012, the first solicitation closed.
Why has it taken more than a year and half to get the program up and
running?
The Federal government currently invests over $9 billion annually
in employment and training programs designed to support an efficiently
functioning labor market through the public workforce investment
system. As the economy recovered in the 12-month period ending June 30,
2011, 9.8 million individuals were participants in one of the
Employment and Training Administration's (ETA) workforce programs
(excluding the Wagner-Peyser Employment Service and Unemployment
Insurance), as reported in ETA's quarterly Workforce System Results.
These individuals faced a range of employment challenges, including
long-term unemployment and skill and credential deficiencies. The
Innovation Fund provides an opportunity to competitively procure and
evaluate innovation strategies that are best positioned to help the
entire workforce system meet these challenges.
The Fiscal Year (FY) 2011 appropriation provided a Federal
obligation deadline of September 30, 2012 for the Workforce Innovation
Fund to allow adequate time to develop a robust grant solicitation in
consultation with Congress, the Administration, federal agency
partners, and workforce system stakeholders. Federal partner programs
were asked to develop written materials and power point presentations
regarding flexibilities and waiver authorities that could be used by
grantees in developing proposals. This material was presented to a wide
audience of potential applicants in a webinar with remarks by senior
officials such as the Assistant Secretary of ETA and the Commissioner
of the Department of Education's Rehabilitation Services Administration
to encourage applicants to use available flexibilities.
The Department also engaged in an extensive stakeholder
consultation process in the summer of 2011. Based on those
consultations, the Department developed a grant competition that will
award grants to projects that:
1. Deliver services more efficiently and achieve better outcomes,
particularly for vulnerable populations (e.g. low-wage and less-skilled
workers) and dislocated workers, especially those who have been
unemployed for many months;
2. Support both system reforms and innovations that facilitate
cooperation across programs and funding streams in the delivery of
client-centered services to jobseekers, youth, and employers;
3. Ensure that education, employment, and training services are
developed in partnership with specific employers or industry sectors
and reflect current and future skill needs; and
4. Emphasize building knowledge about effective practices through
rigorous evaluation and translating ``lessons learned'' into improved
labor market outcomes, the ability to bring such practices to scale in
other geographic locations and increased cost efficiency in the broader
workforce system.
It is our goal that grants funded under the Workforce Innovation
Fund will achieve the following within the public workforce system:
1. Better results for jobseekers and employers--such as reduced
duration of unemployment, increased educational gains that lead to work
readiness, academic and industry-recognized credential attainment,
increased earnings, and increased competitiveness of employers;
2. Greater efficiency in the delivery of quality services--such as,
more customers (job seekers or employers) served, decreased program
attrition/customer throughput, faster job placement, achieving outcomes
for lower cost or reduction in program overlap and administrative
costs; and
3. Stronger cooperation across programs and funding streams--such
as integrated data management information systems, braided funding, or
changes that create a more seamless service delivery experience for
participants who need help from multiple programs.
The Department received a tremendous response to the SGA. We
announced the award of the full amount of the FY 2011 appropriation
plus $27 million from the FY 2012 appropriation, for a total of nearly
$147 million on June 14, 2012. Twenty-six grants, ranging from $1
million to $12 million each, were awarded to a combination of state
workforce agencies and local workforce investment boards, as well as
one Workforce Investment Act Section 166 grantee serving Indian and
Native American communities. We also announced the Pay for Success
Solicitation for Grant Applications, which makes up to $20 million of
the FY 2012 appropriation available for Pay for Success pilot grants.
The Solicitation closes on December 14, 2012. More information about
the recent grant announcements and Pay for Success SGA can be found at
http://www.doleta.gov/workforce_innovation/.
8. One of the goals of the new Workforce Innovation Fund is to
develop new service delivery services and processes to improve outcomes
for workers in the job training system. These activities aren't new--
they mirror what state and local workforce investment boards do every
day and reflect the fundamental mission of the programs authorized
under the Workforce Investment Act. How is this program different from
initiatives currently being funded? How will the department ensure
these new programs are not duplicating efforts already underway?
The Workforce Innovation Fund is designed to strengthen the
Federally-funded workforce investment system by implementing and
evaluating projects that achieve: 1) better results for jobseekers and
employers; 2) greater efficiency in the delivery of quality services;
and 3) stronger cooperation across programs and funding streams.
Through the Workforce Innovation Fund, the Department will invest in
projects along a continuum of innovation and evidence, from new ideas
that have never been tried, to well-tested ideas being adapted to new
contexts. By evaluating projects along this continuum, the Fund will
significantly increase the body of knowledge about what works in
workforce development and strengthen the evidence pool that will drive
future investments.
QUESTIONS FOR THE RECORD SUBMITTED BY REPRESENTATIVE VIRGINIA FOXX
1. During your recent testimony before the committee, you stated
that the department has rigorous evaluations for all programs. Please
provide copies of these evaluations as well as the results (specific
numbers) the participants in the programs received in obtaining
employment, increasing their wages, and receiving a job in the field
they were trained.
The Department has an extensive history of using applied research
and evaluation of existing programs and for the exploration of new
ideas. For example, within the last three years, the Employment and
Training Administration (ETA) has completed rigorous impact evaluations
of major public workforce system programs that clearly show the
benefits received from training and employment services. These
evaluations include:
Individual Training Accounts. Perez-Johnson et al. (2012)
reports the results of the Individual Training Account (ITA)
Experiment. The ITA Experiment is the most comprehensive study to date
of the long-term impacts of different individual training account
delivery models for public workforce system participants. The study
found that ITA-related counseling alone had little effect on training
choices, training outcomes, employment rates, or the average number of
hours participants worked in a quarter. However, earnings increased
more steeply and plateaued at a higher level for participants in the
Structured Choice model, which required ITA counseling, granted the
counselor more discretion to tailor training to the participants'
needs, and provided a larger training benefit. Structured Choice
participants were also slightly more likely to be employed in high-wage
jobs and in the field for which they trained than participants in the
other models studied. (http://wdr.doleta.gov/research/
keyword.cfm?fuseaction=dsp_resultDetails&pub_id=2485&mp=y.)
Workforce Investment Act. Heinrich et al. (2009) report
results of a non-experimental net impact evaluation of the Adult
program under the Workforce Investment Act (WIA). The result for all
participants in the WIA Adult program (regardless of services received)
show that participating is associated with a several-hundred dollar
increase in quarterly earnings over the period of the study. Due to the
non-experimental design, it is possible that this increase reflects
unmeasured characteristics of individuals receiving services rather
than the impact of the WIA Adult program. (http://wdr.doleta.gov/
research/keyword.cfm?fuseaction=dsp_puListingDetails&pub--
id=2419&mp=y&start=41&sort=7)
Reemployment of Unemployment Insurance Claimants. In a
recent report that examines the Reemployment Eligibility Assessment
(REA) Program in Nevada, Michaelides et al. (2012) estimate the impact
of the Nevada REA program on claimant UI receipt and quarterly wage
outcomes following program entry. The key finding was that the Nevada
REA program led to significantly shorter UI durations and lower benefit
amounts--REA treatment group claimants collected 3.13 fewer weeks and
$873 lower total benefit amounts than their peers. These savings
exceeded average program costs by more than four times, providing
strong evidence that the Nevada REA program is a cost-effective
intervention. In addition, the Nevada REA program was effective in
assisting claimants to find employment in the period following program
entry. Nevada REA treatment group members were nearly 20 percent more
likely than their peers to obtain employment in the first two quarters
after program entry. (http://wdr.doleta.gov/research/
keyword.cfm?fuseaction=dsp_resultDetails&pub_id=2487&mp=y)
The Role of Unemployment Insurance During Recession.
Vroman (2010) used Moody's Economy.com macro-economic simulation models
to reaffirm the value of UI as an automatic economic stabilizer during
the latest recession. The study found that UI benefits: 1) reduced the
fall in GDP by 18.3% in 2009; 2) kept an average of 1.6 million
Americans on the job in each quarter: at the low point of the
recession, lowering the unemployment rate by approximately 1.2
percentage points; 3) had a multiplier effect of 2.0, where for every
dollar spent on unemployment insurance, economic activity increased two
dollars. (http://wdr.doleta.gov/research/
keyword.cfm?fuseaction=dsp_resultDetails&pub_id=2447&mp=y)
Other reports on rigorous impact evaluations of major programs are
nearing completion and the Department anticipates that they will be
released in the coming months, including an evaluation of the
Registered Apprenticeship Program, and the evaluation of the Trade
Adjustment Assistance Program. In addition, several ongoing evaluations
of workforce programs are underway including an evaluation of the
YouthBuild program, the WIA Gold Standard evaluation and an evaluation
of the Transitional Jobs demonstration grants.
ETA has made available on its Web site an annotated bibliography of
selected evaluation and research studies that it has conducted between
1995 and 2011. This bibliography, titled ``Employment Research in
Brief: An Annotated Bibliography of ETA-Sponsored Studies'' (http://
wdr.doleta.gov/research/FullText_Documents/ETAOP_2012_01.pdf) includes
124 publications and links to their location on the ETA Web site. Since
2011, ETA has completed 12 additional research and evaluation studies:
Impact of the Reemployment and Eligibility Assessment
(REA) Initiative (http://wdr.doleta.gov/research/FullText_Documents/
ETAOP_2012_08_Impact_of_the_REA_Initiative.pdf)
Green Jobs and Health Care Implementation (http://
wdr.doleta.gov/research/FullText_Documents/ETAOP_2012_07.pdf)
Improving the Effectiveness of Individual Training
Accounts: Long-Term Findings from an Experimental Evaluation of Three
Service Delivery Models (http://wdr.doleta.gov/research/
FullText_Documents/ETAOP_2012_06.pdf)
Process Evaluation and Outcomes Analysis: Twin Cities
RISE! Performance-Based Training and Education Demonstration Project
Final Report (http://wdr.doleta.gov/research/FullText_Documents/
ETAOP_2012_05.pdf)
Innovative Programs and Promising Practices: Indian and
Native American Summer Youth Employment Initiatives and the 2009
Recovery Act (http://wdr.doleta.gov/research/FullText_Documents/
ETAOP_2012_04.pdf)
Beyond a Summer Work Experience: The Recovery Act 2009
Post-Summer Youth Employment Initiative (http://wdr.doleta.gov/
research/FullText_Documents/ETAOP_201_03.pdf)
Using TANF Funds to Support Subsidized Youth Employment:
The 2010 Summer Youth Employment Initiative (http://wdr.doleta.gov/
research/FullText_Documents/ETAOP_2012_02.pdf)
Evaluation of the Technology-Based Learning Grants Final
Report (http://wdr.doleta.gov/research/FullText_Documents/
ETAOP_2011_21.pdf)
Implementation and Early Training Outcomes of the High
Growth Job Training Initiative: Final Report (http://wdr.doleta.gov/
research/FullText_Documents/ETAOP_2011_20.pdf and http://
wdr.doleta.gov/research/FullText_Documents/
ETAOP_2011_20_Appendices.pdf)
Early Implementation Report: Mentoring, Educational, and
Employment Strategies (MEES) to Improve Academic, Social and Career
Pathway Outcomes in Persistently Dangerous Schools--Generation I
(http://wdr.doleta.gov/research/FullText_Documents/ETAOP_2011_19.pdf)
Early Implementation Report: Mentoring, Educational, and
Employment Strategies (MEES) to Improve Academic, Social and Career
Pathway Outcomes in Persistently Dangerous Schools--Planning Report
(http://wdr.doleta.gov/research/FullText_Documents/ETAOP_2011_18.pdf)
Evaluation of the Career Advancement Accounts
Demonstration Project: An Implementation Study (http://wdr.doleta.gov/
research/FullText_Documents/ETAOP_2011_17.pdf)
All ETA research and evaluation studies published since 1977 are
publically available for download from the ETA Evaluation Database at
http://wdr.doleta.gov/research/keyword.cfm.
ETA's research and evaluation efforts include the study of impacts
and outcomes of workforce development and employment strategies and
programs, as well as the testing of concepts to determine their
potential viability.
2. The President's FY 2013 request proposes a new $8 billion
Community College to Career Fund, which is in part based on a similar
program, the Trade Adjustment Assistance Community College and Career
Training Grant Program (TAACCCTG). Please provide an evaluation of the
TAACCCTG program and the results (specific numbers) it has achieved in
helping individuals obtain degrees and credentials for high-skill
occupations.
The Community College to Career Fund will ensure that workers have
a stronger likelihood for success in the classroom and job market. The
TAACCCT grant program provides postsecondary education institutions
with an opportunity to expand and improve their ability to deliver
education and career training programs that can be completed in two
years or less, and are suited for workers who are eligible for training
under the Trade Adjustment Assistance (TAA) for Workers Program of the
Trade Act of 1974 (as amended) 19 U.S.C. 2271-2323, as well as other
adults. The Department did not require institutions funded in the first
round of grants (awarded in 2011) to conduct third-party evaluations of
their projects. However, reporting requirements for the TAACCCT grant
program are designed to ensure that grantees maintain data on students
and their participation and credential attainment, and continuously
monitor and improve program performance throughout the grant period.
Grantees must report on the progress of the grants quarterly and
provide an annual update on the progress of participants to the
Department. Since the first round grantees have been active only since
October 1, 2011, and the grantees currently are in the capacity-
building phase of their projects, the Department expects to have the
first data after grantees submit their initial yearly report in late
2012. Accordingly, the Department does not yet have performance data to
share. These first round grantees are responsible for the deliverables
identified in their statements of work, quarterly reports, as well as a
final report.
In the second round of TAACCCT grants, which the Department expects
to award in late summer 2012, grantees will be required to conduct
third-party evaluations. In addition, the Department expects to
procure, in summer 2012, a separate, third-party to conduct a national
evaluation of the TAACCCT grant program that will cover both rounds of
grantees. The evaluator will survey all grantees to obtain descriptive
information about their grant-funded programs and activities, review
the designs of third-party evaluations of round two grantees and any
round one grantees that have third-party evaluations, and conduct an
analysis and synthesis of all findings from the grantees' evaluations
(from both rounds). The national evaluation will use a mixed-method
design to conduct an outcome analysis, implementation analysis,
performance assessment, and an assessment of the feasibility of
conducting more detailed impact analysis using random assignment
methods in selected round two or round one grantees to obtain more
precise evidence on particular strategies or interventions that appear
to hold the most promise for increasing attainment of industry-
recognized credentials, employment and earnings. The Department has
planned for several interim deliverables (grantee assessment, cross-
site implementation analyses) under the national evaluation, as well as
a final report following the grant completion.
QUESTIONS FOR THE RECORD SUBMITTED BY REPRESENTATIVE TODD ROKITA
1. In response to a rule proposed by your department on March 18,
2011, that has since been finalized which would alter the H2B program,
the Small Business Administration Office of Advocacy noted that the
``rule creates numerous administrative burdens and compliance costs,''
``underestimates compliance costs, and fails to analyze the cumulative
impact of [the rule's] requirements,'' and urged ``DOL to consider
significant alternatives to this proposed rule recommended by small
entities that would meet the agency's objectives without jeopardizing
small businesses.''
The rule was finalized anyway. How did your department justify this
rule in light of SBA's concerns?
The Department carefully considered written comments to the
proposed rule submitted by the Chief Counsel for Advocacy of the Small
Business Administration (SBA), along with written comments and
significant regulatory alternatives from small businesses and their
representatives. We also considered feedback gathered during an April
26, 2011 roundtable discussion conducted by the SBA, which included
Department representatives, small businesses, and SBA representatives.
The Department does not believe that the referenced rule, Temporary
Non-Agricultural Employment of H-2B Aliens in the United States
(Comprehensive Final Rule), will impose a significant economic burden
on a substantial number of small businesses; however, the Department
made a number of changes to the proposed rule that addressed many of
the concerns SBA expressed and that were expressed in the comments
received from other small business employers. Among other changes, you
may be interested to know that the Department's response to comments
resulted in the inclusion of an ``acts of God'' provision, which could
relieve employers of certain requirements and a significant reduction
in the referral period.
The preamble of the Comprehensive Final Rule (77 FR 10038) provides
further details on how the Department of Labor responded to the
concerns of SBA and small businesses as well as our consideration of
significant regulatory alternatives suggested by small businesses and
their representatives.
2. In response to a rule proposed by your department on March 18,
2011, that has since been finalized which would alter the H2B program,
the Small Business Administration Office of Advocacy noted that DOL's
Initial Regulatory Flexibility Analysis was inadequate because it
failed to properly evaluate the number of small businesses impacted by
the rulemaking, underestimated the economic impact of the rule on small
businesses and did not discuss significant alternatives that may have
minimized the impact of the rule on small businesses.
Did DOL subsequently perform a proper Initial Regulatory
Flexibility Analysis as it is legally required to do?
The Department prepared an Initial Regulatory Flexibility Analysis
(IRFA) that complied with SBA guidance and procedures. The Final
Regulatory Flexibility Analysis (FRFA) addressed written comments to
the proposed rule submitted by the Chief Counsel for Advocacy of the
SBA, along with written comments and significant regulatory
alternatives from small businesses and their representatives.
The Chief Counsel for Advocacy of the SBA commented that the
economic impact calculated in the IRFA was underestimated because it
failed to account for higher wages that employers may have to pay
resulting from a separate rule published by the Department on January
19, 2011 that changed the way H-2B prevailing wages are determined. The
Chief Counsel for Advocacy also commented that the IRFA underestimated
the proportion of small businesses that would be impacted.
In response to these assertions, the Department explained in the
Comprehensive Final Rule that the full cost impact of the January 2011
prevailing wage Final Rule was accounted for in that rule's FRFA.
Regarding the Comprehensive Final Rule's IRFA calculation of the
proportion of small businesses affected, the Department evaluated the
economic impact across 1.1 million employers, which represents all
small businesses, according to SBA's definition of a small entity,
within the five most common industries using the H-2B program. In our
final analysis the Department determined that this rulemaking would not
have a significant impact on a substantial number of small entities.
The preamble of the Comprehensive Final Rule (77 FR 10038) provides
details on how the Department of Labor evaluated the number of small
businesses impacted, the economic impact of the rule on small
businesses, and the alternatives considered by the Department to
minimize the impact the rule would have on small businesses.
3. Madame Secretary, your department recently finalized two rules
that will alter the H2B program. Thousands of small businesses
throughout the country have made it clear that those rules are a threat
to them and their full-time employees. Even the SBA opposed the rules
and noted that your department did not adequately study the impact of
the rules as it is required to do by law.
Can you tell me how many existing full-time jobs these rules will
either eliminate or threaten?
The Department does not believe that the Wage Methodology for the
Temporary Non-Agricultural Employment H-2B Program Final Rule (Wage
Final Rule) or the Comprehensive Final Rule will eliminate full-time
jobs but instead will provide unemployed U.S. workers with meaningful
access to job opportunities.
The Department also believes that these rulemakings will help
ensure that employers and small businesses are able to find qualified
U.S. workers to fill their temporary positions in a timely manner,
while addressing the critical issue that the employment of foreign
workers will not adversely impact the wages and working conditions of
U.S. workers.
The Department carefully considered written comments submitted by
SBA's Office of Advocacy and addressed these recommendations in the
preambles of our final rules.
4. Madame Secretary, on January 18, 2011, President Obama issued a
presidential memorandum which expressed his administration's commitment
to eliminating excessive and unjustified burdens on small businesses.
However, the very next day your department issued a new rule that
dramatically inflated the cost of the using the H2B program. In fact,
Congress blocked the rule because there was so much concern about it.
Recently your department issued another rule that thousands of small
businesses throughout the country as well as the Small Business
Administration consider highly excessive and unjustifiably burdensome.
How can your department's new rules be consistent with the stated
intent of the presidential memorandum?
Executive Order 13563 calls for public participation, with agencies
directed to seek the view of those who are likely to be affected,
ensuring that rules will be informed and improved by the knowledge of
those affected. The Executive Order also calls for careful analysis of
the likely consequences of regulation, maximizing net benefits,
selecting the least burdensome alternatives and considering alternative
approaches.
The Department engaged in public participation and careful cost-
benefit analysis for the 2011 wage rule and the 2012 comprehensive
rule. The preamble of each final rule contains extensive discussion on
these matters.
5. Madame Secretary, your department recently finalized two rules
that will alter the H2B program. I understand that one of the rules is
the subject of two lawsuits which claim that the law states that
authority to issue rules lies with the Department of Homeland Security
and that the Department of Labor only acts in an advisory role to DHS
with no rulemaking authority over the program.
Can you tell me specifically where the statute is that states that
DOL has rulemaking authority over the H2B program?
The Department is engaged in litigation concerning its rulemaking
authority over the H-2B program The Department's position on this
matter, as well as a comprehensive description of the Department's
legal authorities, are set out in the attached appellate court brief,
which is the latest brief on the issue. We trust this brief will
provide a complete picture of the Department's regulatory authority
over the H-2B program.
6. Madame Secretary, your department recently finalized two rules
that will alter the H2B program. I understand that one of the rules is
the subject of two lawsuits and that one of the claims against the rule
states that your department did not take employer interest into account
when the rules were promulgated as it is supposed to do.
Did your department take into consideration employer interest in
issuing these rules and if so, in what way specifically?
The Department of Labor considered comments provided by employers
in both the Wage Final Rule and the Comprehensive Final Rule. For the
Wage Final Rule (76 FR 3452), the Department received and considered
comments from SBA and small businesses. The preamble of the Wage Final
Rule provides details on how the Department responded to their concerns
and proposals for alternative prevailing wage-setting methods.
The Comprehensive Final Rule (77 FR 10038) responded to
recommendations made by employers and their representatives as well.
For example, the Department responded to employer recommendations to
limit the potential reach of the corresponding employment provision and
more clearly articulated which U.S. workers could be considered
corresponding workers for the purposes of receiving the same wages and
benefits as H-2B workers.
The Comprehensive Final Rule also incorporated employer
recommendations about the proposed requirement to pay for or reimburse
a worker for the cost of inbound transportation and subsistence by
qualifying that the requirement to reimburse is in effect after the
worker completes 50 percent of the job contract and the outbound
transportation is only paid if the worker completes the job order
period or is dismissed early. This addressed employer concerns that
they may be paying transportation for workers who did not perform a
significant amount of work.
The Comprehensive Final Rule also responded to employer
recommendations about the proposed requirement to pay an H-2B worker
for three quarters of the hours offered in the job order, even if there
is less work, by increasing the length of time over which that amount
is determined and relieving employers of this requirement if there are
man-made catastrophic events outside their control or acts of God.
Finally, the Comprehensive Final Rule reduced the period during
which employers have an obligation to hire U.S. workers to 21 days
before the date of need. This responds to employers' assertions that
the Department's proposal in 2011 extending the period for accepting
referrals of U.S. applicants until the later of 3 days before the date
of need or the date on which last H-2B worker departs for the job
opportunity would be unworkable and potentially costly for employers.
Other examples of how the Department responded to comments provided
by SBA's Office of Advocacy and by small businesses and their
representatives can be found in the preamble of the Comprehensive Final
Rule (77 FR 10038).
QUESTIONS FOR THE RECORD SUBMITTED BY REPRESENTATIVE LYNN WOOLSEY
In my District, I have seen firsthand the value of life-saving and
life-renewing services offered by community-based nonprofits that
provide residential treatment for substance use disorder. They treat
addiction first and foremost, but also help reintegrate people into
society.
1. How is the Department supporting ex-offender reentry through its
programs and the resources it makes available to the states?
The Department of Labor's Reintegration of Ex-Offenders
Appropriation funds both an adult program, which serves released
prisoners returning home, and a youthful ex-offender program, which
serves juvenile and young adult ex-offenders and at-risk youth. The
adult program is an employment-centered initiative that seeks to
strengthen urban communities that have large numbers of returning
prisoners. The program funds competitive grants to local faith-based
and community-based organizations to provide mentoring, job training,
and other comprehensive transitional services. It is designed to reduce
recidivism by helping inmates find work when they return to their
communities, as part of an effort to improve community life.
The youthful ex-offender program provides competitive grants to
local non-profit community-based organizations and state and local
juvenile justice agencies to provide training, mentoring, service-
learning, career exploration and employment opportunities. These grants
focus on youth ages 14 to 24 and serve young offenders and youth at
risk of criminal involvement, including school dropouts.
The Department makes a concerted effort to ensure that local,
community-based organizations are aware of these grant opportunities
and have the tools they need to be competitive applicants and
participants. One of the primary responsibilities of the Department's
Center for Faith-based and Neighborhood Partnerships is to disseminate
information about these and other grant opportunities to community-
based organizations and to provide technical assistance and guidance on
how to apply as a lead applicant and how to partner with another
eligible organization as a sub-grantee. Additionally, in 2010 the
Department released a Grants 101 Toolkit specifically designed to help
community-based organizations respond to competitive solicitations for
grant applications.
In Program Year 2011 (July 2011--June 2012), the Department has
awarded or will award:
$30 million to serve young adult ex-offenders ages 18 to
24 through service-learning activities that allow them to provide a
valued service to their communities while learning marketable skills;
$19.5 million to serve youth ex-offenders between the ages
of 14 to 21 through regional intermediate organizations that will
provide training in demand industries that result in credential
attainment;
$12 million to serve youth and adult ex-offenders through
strategies targeting the characteristics common to female ex-offenders;
and
$20.5 million for a fifth round of Adult Reintegration of
Ex-Offender grants to faith-based and community non-profit
organizations in 18 urban communities across the country to serve
returning adult ex-offenders.
2. Understanding that drug and alcohol treatment centers do not
deploy the traditional One Stop Career Center model, when considering
how to deal with re-entry, it seems sensible that the Department of
Labor would tailor the program to work with groups that specialize in
dealing with ex-offenders. Has the Department considered these benefits
when thinking of ex-offender re-entry, and how can these rehabilitation
centers work with the Department to provide job training services, on
their own or with One-Stop Centers?
In order to successfully reintegrate into the community, it is
essential that ex-offenders possess the skills and support necessary to
enter and compete for jobs in the labor market as well as avoid
recidivism. Faith-based and community-based organizations (FBCBOs)
provide critical infrastructure and resources to assist with the
reintegration of ex-offenders; FBCBOs often have strong roots within
the local communities they serve and are able to bring together
networks of social support organizations. Department of Labor grantees
are required to develop partnerships with organizations that provide
supportive services, such as: substance abuse and mental health
treatment centers, vocational rehabilitation, housing assistance, child
care, family reunification services and legal services etc.
QUESTIONS FOR THE RECORD SUBMITTED BY REPRESENTATIVE MARCIA FUDGE
1. Community based organizations (CBOs,) both private and non-
profit, possess firsthand knowledge and experience implementing
effective and successful workforce development measures to meet the
needs of the unemployed, especially the long-term unemployed and
individuals with multiple barriers to employment. Because of this, CBOs
must not be relegated to the role of service providers only, CBOs must
also be included in policy discussions. CBOs are an integral and
effective component of our nation's workforce development system. CBOs,
especially minority-serving CBOs, represent the perspective and needs
of diverse populations including African American, Hispanic and other
people of color.
What efforts has the Department of Labor undertaken to ensure
minority community based organizations receive equitable representation
on state and local Workforce Investment Boards (WIBs,) or other local
governing mechanisms that may be established by WIA, where policy and
programmatic decisions are made?
The Workforce Investment Act (WIA) recognizes that community-based
organizations (CBOs) have an important role in the public workforce
system, both to deliver services and to help shape workforce policy.
WIA Section 111(b)(1)(C)(v) reserves two or more seats on every State
Workforce Investment Board (SWIB ) for representatives of organizations
that have experience and expertise in the delivery of workforce
investment activities, including chief executive officers of community
colleges and CBOs within the State. SWIB members are appointed by the
Governor. At the local level, WIA Section 117(b)(2) (A)(iv) requires
that each Local Workforce Investment Board (LWIB) have two or more
representatives from CBOs; chief local elected officials are
responsible for LWIB appointments.
In addition to the representatives of CBOs who sit on SWIB and
LWIBs, any CBO has the opportunity to attend Local Board meetings and
provide comments on Board proceedings, including the eligible provider
process. The Department reviews WIA Strategic State Plans, which must
describe Board composition and membership, and the Department conducts
regular monitoring of States and local areas to ensure that Board
requirements are met.
The Department's Center for Faith-based and Neighborhood
Partnerships has a specific focus on informing CBOs, as well as
community and faith leaders, about the SWIBs and LWIBs. They work with
local stakeholders to encourage community-based organizations to attend
WIB meetings and provide information on meeting dates and locations.
For example, the Center has been working with the Outreach Coordinator
for the Faith-Based and Community Initiatives Office of Ohio Governor
John R. Kasich to spread the word about WIB meetings. The Center also
encourages community groups to inquire with the local WIB leadership
about membership on the boards.
What efforts has the Department of Labor undertaken to ensure
community based organizations, of demonstrated effectiveness, are
included as an integral and effective component of our nation's
workforce development system and its evolving partnership with
community colleges?
In addition to CBOs' representation on state and local workforce
investment boards, many provide services through the One-Stop delivery
system at the local level. The Department has issued a number of
competitive grants that encourage partnerships among the public
workforce system, CBOs, and community colleges, as well as other
organizations. These grants include the Senior Community Service
Employment Program, Pathways out of Poverty, the Add Us In initiative,
the Green Jobs Innovation Fund, and the Health Care Virtual Career
Platform. We also anticipate that CBOs will be local grantee partners
in some projects funded under the proposed Community College to Career
Fund initiative, helping participants acquire the basic skills that
improve their employability, learn technical skills, and access support
systems that allow them to meet the needs of their families while they
concentrate on gaining new skills and competencies.
In addition, CBOs are eligible applicants for the Department's
YouthBuild discretionary grants that focus on providing education and
construction skills training to disadvantaged young people who are high
school dropouts. They also are eligible to apply for many of the
Department's Reintegration of Ex-Offender grants that focus on helping
youth and adult offenders to successfully reenter their communities and
increase their education and employment outcomes.
The Department's Center for Faith-based and Neighborhood
Partnerships helps to facilitate partnerships between community-based
organizations and the workforce development system, including One-Stop
Career Centers and Community Colleges. For example, the Center recently
hosted a webinar to highlight examples of CBOs that are partnering with
local workforce development systems to host job fairs. In another
example, the Center has been working with Cuyahoga Community College's
Advanced Technology Academy to develop partnerships with CBOs in order
to recruit youth for their training programs and offer supportive
services that assist with successful completion.
How has the Department of Labor enforced conflict of interest
provisions to prevent Workforce Investment Boards from functioning as
direct service providers?
Under 20 CFR 661.310, Local Workforce Investment Boards may
function as direct service providers only with the agreement of, or
waiver from, the Governor. In addition, there are a number of statutory
and regulatory provisions that govern conflict of interest related to
Workforce Investment Boards (WIB) and service providers. The Uniform
Administrative Requirements are government-wide standards regarding
procurement that all Federal grantees must follow, including standards
for conflict of interest. The Department of Labor codified these
requirements at 29 CFR Part 97 for governmental grantees and at 29 CFR
Part 95 for non-governmental grantees. Conflict of interest regulation
for entities receiving Workforce Investment Act (WIA) title I funds (20
CFR 667.200(a)(4)) indicates that in addition to the uniform
administrative requirements mentioned above, a state or local WIB
member, or a Youth Council member must neither cast a vote, nor
participate in decision-making, on the provision of services by that
member or any organization which that member directly represents. The
WIB member also must not cast a vote, nor participate in decision-
making, on any matter that would provide any direct financial benefit
to that member or a member of his or her immediate family. WIA
regulations note that neither membership on a WIB or Youth Council
alone, nor the receipt of WIA funds to provide training and related
services violates these conflict of interest provisions. The Department
of Labor monitors both State and local WIA grant recipients for
compliance with statute and regulations. The Employment and Training
Administration also includes state policies related to these
requirements in its oversight and monitoring of states, including its
review of policies submitted with the WIA Strategic State Plans. In
2011, ETA published Training and Employment Guidance Letter 3510,
titled ``Transparency and Integrity in Workforce Investment Board
Decisions,'' to remind state and local boards of the conflict of
interest provisions in the law.
2. Urban communities need community based organizations, like the
National Urban League, to be supported by the Federal Government. Their
innovative and culturally competent programs are operated by local
community leaders who have lived and worked in the communities they
serve for many years. As the economy slowly gains steam, it is clear
that we cannot recover without targeted measures to address
unemployment in the hardest-hit communities. We congratulate groups
like the National Urban League for recognizing what needs to be clone
every day on the front lines and fighting for the communities we
represent.
What efforts has the Department of Labor undertaken to encourage
partnerships with national community based organizations that have been
anchors in urban communities? Can you share any lessons the Department
has learned about what the government can do to encourage such
partnerships?
National community-based organizations are critical access points
for workers seeking to transition into new industries and careers. They
understand the importance of leveraging resources, engaging employers
to better understand their workforce needs and secure employment for
their participants, and providing comprehensive supportive services in
a manner that is culturally and linguistically appropriate. By serving
as key providers of basic skills training, technical skills training,
and workforce development services through local affiliates in many
urban, rural, and suburban communities across the country, national
community-based organizations bring a broad perspective to workforce
partnerships that is rooted in their experiences in local communities.
National community-based organizations are grantees or key partners
in many of the Department's grant initiatives, such as the Senior
Community Service Employment Program, Pathways out of Poverty, and the
Green Jobs Innovation Fund, and we anticipate that they will be local
grantee partners in some projects funded under the proposed Community
College to Career Fund initiative to help participants acquire the
tools and skills to be successful in knowledge-based economy. The
National Urban League is a current grant recipient under the
Reintegration of Ex-Offenders-Adult Generation 4 grant project and a
number of its affiliates are grantees under other Departmental grant
programs.
In addition to these competitive grant programs, national
community-based organizations and their local affiliates operate local
One-Stop Career Centers through contracts with local agencies. Two such
examples include Instituto del Progreso Latino, an affiliate of the
national community-based organization National Council of La Raza,
which operates a local One-Stop in Chicago; and in New York City, the
local Goodwill Industries operates the Brooklyn One Stop Center under a
contract with the City of New York.
ADDITIONAL OUTSTANDING HEARING ITEMS
Rep. Biggert requested an update timetable for a re-proposal for
the Definition of ``Fiduciary'' rulemaking.
The Department's Employee Benefits Security Administration (EBSA)
announced on September 19, 2011, that it will repropose its rule on the
definition of a fiduciary. The reproposal is designed to ensure an open
exchange of views and protect consumers while avoiding unjustified
costs and burdens. This continues to be a high priority project for the
Department. While we are making good progress, we are taking the time
we need to get the regulation and economic analysis right and to ensure
proper coordination with the SEC and other relevant government offices
and agencies, so we cannot predict with specificity when the reproposal
will be published.
We are examining a wide array of evidence with the goal of
developing a more robust economic analysis. The analysis will focus not
only on the economic impact of a new rule on workers and retirees, but
also on plan sponsors who often critically rely upon expert advice to
discharge their own fiduciary responsibilities with respect to the
management of plan assets and selection of plan investment options.
As part of this process, we sent out two voluntary data requests in
mid-December 2011. One was for the underlying data supporting the
conclusion in the Oliver Wyman report, a document which was submitted
as a comment on the Department's October 2010 proposal, and which has
been cited as demonstrating that the costs of applying fiduciary rules
to IRA advisers would be prohibitive. The Department's request was
addressed to the commenter who, on behalf of a group of twelve
financial firms that offer services to retail investors, engaged Oliver
Wyman to prepare the report, and then submitted the report for the
record. In response, the Department received some additional, but
limited, aggregated data, while other, more granular underlying data
was not forthcoming.
The Department also sent another, broader request to leading
financial services industry groups. This was part of our ongoing effort
to make sure we give interested stakeholders every opportunity to
provide input. While the Department was disappointed not to receive
many of the suggested data elements from the industry sources, we have
met with industry representatives and asked them to provide whatever
information they had that would be useful to our efforts.
We appreciate the information that has been sent and are working
diligently to review and assess it. The Department also has been
collecting information from a variety of other sources. We will
incorporate all of this information and feedback into our updated
economic analysis of our updated proposal. We continue to welcome the
receipt of any additional relevant data that interested stakeholders
wish to provide in order to assist us with our work on this project,
and will likewise incorporate any such data into our analysis as well.
Our objective is to craft a clear and workable regulation that
provides the strongest possible consumer protections to employees in
employee benefit plans and IRA owners as well as plan sponsors who
offer retirement plans to workers, supported by a robust and fully
transparent economic analysis to accompany the new proposed regulation.
Since all components of the reproposed regulation will be open to
public review and comment once published, we expect another opportunity
to receive input.
Also under consideration are updates to current prohibited
transaction exemptions and new exemptions addressing concerns about the
impact of the regulation on current fee practices of brokers and
advisers. Here again, our aim is to promote advice that is both
impartial and affordable, and that is provided under circumstances that
protect plans, participants and IRA owners from abusive practices. We
will propose a package of amendments to current prohibited transaction
exemptions and most likely at least one new exemption that will be
issued at the same time as the reproposal. Like the reproposed
regulation itself, the proposed exemptions will be open for public
comment.
Rep. Thompson asked if DOL collects data on the number of jobs
which employers are unable to fill with qualified workers.
The Department of Labor does not collect data that distinguishes
between companies unable to find qualified workers for vacancies and
those that have vacancies due to other reasons. However, you may be
interested to know that the Bureau of Labor Statistics publishes data
on job openings, hires, and separations in its Job Openings and Labor
Turnover Survey (JOLTS). This, along with background information about
the survey, may be found at (http://www.bls.gov/jlt/).
Rep. Foxx requested copies of the evaluations conducted by DOL on
the programs--including numbers for how recipients' income has
increased--referenced in her exchange with Secretary Solis.
All ETA research and evaluation studies since 1977 are publically
available for download from the ETA Evaluation Database at http://
wdr.doleta.gov/research/keyword.cfm.
ETA's research and evaluation efforts include the study of impacts
and outcomes of workforce development and employment strategies and
programs, as well as the testing of concepts to determine their
potential viability.
Rep. Foxx requested detailed information concerning funding for job
training program, including funding for homeless women veterans.
------------------------------------------------------------------------
FY2011* FY2012* FY2013*
Programs Enacted w/ Enacted w/ President's
Rescissions Rescissions Request
------------------------------------------------------------------------
Adult Employment & Training...... 769,576 770,811 769,465
Dislocated Workers............... 1,061,807 1,008,151 1,006,526
Workforce Innovation Fund........ 124,750 49,906 100,000
Youth Activities................. 825,914 824,353 824,353
Reintegration of Ex-Offenders.... 85,390 80,238 85,238
Youth Build...................... 79,840 79,689 79,689
Native Americans................. 52,652 47,562 52,562
Migrants & Seasonal Farmworkers.. 84,451 84,291 84,291
Job Corps Operations............. 1,570,932 1,569,078 1,545,872
------------------------------------------------------------------------
*Figures are in thousands.
In regard specifically to homeless women veterans, a group that is
greatly overrepresented in the homeless population, the Department's
Veterans Employment and Training Service operates the Homeless Veterans
Reintegration Program, from which it has funded grants to assist
homeless female veterans and veterans with families.
The Department awarded $5,256,580 on such grants in PY 2010. A
total of 1,406 participants were served, of which 805 were female
veterans, at a cost per participant, based on award level, of $3,738.
Moreover, 60.6% of the veterans served were placed into employment.
Through the 2nd quarter of PY 2011, 705 female participants have been
served, out of a total 1,257 participants.
The HVRP program awarded $33,767,000 during PY 2010 and served
15,951 veterans, of which 1,533 were female. The total cost per
participant, based on award level, was $2,116; 59% of the participants
were placed into employment. Through the 2nd quarter of PY 2011, 8,719
veterans are enrolled in HVRP, of which, 1,279 are female veterans.
Additionally, during Program Year 2010 (7/1/2010--6/30/2011), ETA
programs served over 1.8 million veteran participants nationwide in its
workforce programs.
Over 1.4 million veterans completed their program during the 12-
month period spanning from 4/1/2010--3/31/2011. The majority of these
services were funded via the Wagner-Peyser and Workforce Investment Act
programs.
Rep. Goodlatte requested clarification on the meaning of ``hazards
not otherwise classified'' under the Global Harmonization rulemaking.
The phrase ``hazards not otherwise classified'' (HNOC) covers
adverse physical or health effects identified through evaluation of
scientific evidence during the classification process that do not meet
the specified criteria for the physical or health hazard classes in the
new rule. In essence, this definition requires classifiers who find
scientific evidence that a chemical can cause death, illness, or injury
to workers in a way not currently covered by the Globally Harmonized
System of Classification and Labeling of Chemicals (GHS), disclose that
fact. It is meant to be a modest and narrow requirement triggered only
when the classifier has objective, scientific evidence of a hazard not
covered by the specific GHS criteria. The definition does not expand
the scope of the prior hazard communication rule or add new burdens but
rather ensures that the new rule will not be less protective than the
prior rule. The prior rule's definition of ``health hazard'' included
any chemical for which there was at least one scientific study showing
that acute or chronic health effects could occur. The definition of
HNOC preserves this coverage by picking up hazards that would be within
the scope of the prior rule but fall outside the specific GHS hazard
classes. It is likely that only very few such hazards exist, inasmuch
as the GHS classifications are the product of over thirty years of
international experience in hazard communication.
Rep. Goodlatte requested clarification on the intent of a
memorandum issued to OSHA field enforcement personnel concerning
employer safety incentive programs.
On March 12, 2012, OSHA issued a guidance memorandum to OSHA
Regional Administrators and Whistleblower Program Managers on
``Employer Safety Incentive and Disincentive Policies and Practices.''
This memorandum discussed several types of employer policies and
practices that can discourage employees from reporting occupational
injuries or illnesses to their employer. Employee reports of injuries
and illnesses are an important way to ensure that dangerous conditions
are identified and corrected and that affected employees receive proper
medical treatment, and the right to report injuries and illnesses is
therefore a core right guaranteed to employees by the Occupational
Safety and Health Act.
OSHA recognizes the value of safety incentive programs, which are
attempts by employers to incentivize safe behavior by their employees,
and it supports programs that effectively encourage employees to
participate in safety related-activities. However, as noted by the
recent GAO report on Safety Incentive Programs, one type of incentive
program--where incentives are tied to low recorded injury and illness
rate, such as a bonus to all who do not suffer an injury or illness--
could discourage injury reporting and thus have the perverse, if
unintended, result of actually reducing safety.
The programs OSHA is concerned about have the potential to be
inconsistent with both Section 11(c) of the Occupational Safety and
Health Act and OSHA's recordkeeping regulations in 29 CFR 1904. Section
11(c) prohibits discrimination against an employee for exercising a
protected right, including the right to report an injury or illness,
and 29 CFR 1904 require employers to keep accurate records of injuries.
While some incentive programs might be well-intentioned efforts to
promote safety, it is also possible that safety incentive programs can
offer awards of sufficient size that a reasonable worker might be
dissuaded from reporting an injury or illness. In such a case, the
program could result in the employer's failure to record injuries or
illnesses that it is required to record under OSHA's recordkeeping
regulations, and OSHA might issue a citation for those violations. If
the program leads to workers who report injuries or illnesses not
receiving benefits or compensation they would have received without
such reports, that could be considered discrimination in violation of
section 11(c), and OSHA could bring an action to remedy that
discrimination.
OSHA does not believe that all types of safety incentive programs
are problematic; it is positive when employers place a high priority on
safety and health, and create appropriate incentives to encourage safe
and healthful workplaces.
Rep. Goodlatte requested a description of DOL's consideration of
OMB circular A-4 during the rulemaking process for the Companionship
Care regulation.
The Department's Application of Fair Labor Standards to Domestic
Service proposed rule contains a preliminary regulatory impact analysis
that was prepared in accordance with the guidance provided in OMB
Circular A-4, which OMB reviewed. The complete preliminary regulatory
impact analysis was published to provide the public with an opportunity
to review and comment on it. See Application of the Fair Labor
Standards Act to Domestic Service; Notice of Proposed Rulemaking (76 FR
81190, Dec. 27, 2011). We take our rulemaking responsibilities
seriously, will continue to comply with Executive Orders 12866 and
13563, and OMB's implementing guidance, Circular A-4, in the
promulgation of rules and regulations.
______
[Whereupon, at 12:21 p.m., the committee was adjourned.]