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Full Text of this Amendment

SA 3435. Mr. REED (for himself, Mr. DODD, Mr. KERRY, Ms. CANTWELL, Mr. WHITEHOUSE, and Mrs. SHAHEEN) submitted an amendment intended to be proposed by him to the bill H.R. 4213, to amend the Internal Revenue Code of 1986 to extend certain expiring provisions, and for other purposes; which was ordered to lie on the table; as follows:

After section 201 insert the following:
SEC. 202. TREATMENT OF SHORT-TIME COMPENSATION PROGRAMS.
(a) In General.--Section 3306 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
"(v) Short-Time Compensation Program.--For purposes of this chapter, the term `short-time compensation program' means a program under which--
"(1) the participation of an employer is voluntary;
"(2) an employer reduces the number of hours worked by employees through certifying that such reductions are in lieu of temporary layoffs;
"(3) such employees are eligible for unemployment compensation if their workweeks have been reduced by the percent designated by State law, provided that such reduction may not be less than 10 percent or more than 60 percent;
"(4) the amount of unemployment compensation payable to any such employee is a pro rata portion of the unemployment compensation which would be payable to the employee if such employee were totally unemployed;
"(5) such employees are not expected to meet the availability for work or work search test requirements while collecting short-time compensation benefits, but are required to be available for their normal workweek;
"(6) eligible employees may participate in an employer-sponsored training program to enhance job skills if such program has been approved by the State agency;
"(7) beginning on the date which is 2 years after the date of enactment of this subsection, the employer certifies that continuation of health benefits and retirement benefits under a defined benefit pension plan (as defined in section 3(35) of the Employee Retirement Income Security Act of 1974) is not affected by participation in the program;
"(8) the employer (or an employer's association which is party to a collective bargaining agreement) submits a written plan describing the manner in which the requirements of this subsection will be implemented and containing such other information as the Secretary of Labor determines is appropriate;
"(9) in the case of employees represented by a union, the appropriate official of the union has agreed to the terms of the employer's written plan and implementation is consistent with employer obligations under the National Labor Relations Act; and
"(10) only such other provisions are included in the State law as the Secretary of Labor determines appropriate for purposes of a short-term compensation program.".
(b) Assistance and Guidance in Implementing Programs.--
(1) ASSISTANCE AND GUIDANCE.--
(A) IN GENERAL.--In order to assist States in establishing, qualifying, and implementing short-time compensation programs, as defined in section 3306(v) of the Internal Revenue Code of 1986 (as added by subsection (a)), the Secretary of Labor (in this section referred to as the "Secretary") shall--
(i) develop model legislative language which may be used by States in developing and enacting short-time compensation programs and shall periodically review and revise such model legislative language;
(ii) provide technical assistance and guidance in developing, enacting, and implementing such programs;
(iii) establish biannual reporting requirements for States, including number of averted layoffs, number of participating companies and workers, and retention of employees following participation; and
(iv) award start-up grants to State agencies under subparagraph (B).
(B) GRANTS.--
(i) IN GENERAL.--The Secretary shall award start-up grants to State agencies that apply not later than June 30, 2011, in States that enact short-time compensation programs after the date of enactment of this Act for the purpose of creating such programs. The amount of such grants shall be awarded depending on the costs of implementing such programs.
(ii) ELIGIBILITY.--In order to receive a grant under clause (i) a State agency shall meet requirements established by the Secretary, including any reporting requirements under clause (iii). Each State agency shall be eligible to receive not more than one such grant.
(iii) REPORTING.--The Secretary may establish reporting requirements for State agencies receiving a grant under clause (i) in order to provide oversight of grant funds used by States for the creation of short-time compensation programs.
(iv) FUNDING.--There are appropriated, out of any moneys in the Treasury not otherwise appropriated, to the Secretary, such sums as the Secretary certifies as necessary for the period of fiscal years 2010 and 2011 to carry out this subparagraph.
(2) TIMEFRAME.--The initial model legislative language referred to in paragraph (1)(A) shall be developed not later than 60 days after the date of enactment of this Act.
(c) Reports.--
(1) INITIAL REPORT.--Not later than 4 years after the date of enactment of this Act, the Secretary shall submit to Congress and to the President a report or reports on the implementation of this section. Such report or reports shall include--
(A) a study of short-time compensation programs;
(B) an analysis of the significant impediments to State enactment and implementation of such programs; and
(C) such recommendations as the Secretary determines appropriate.
(2) SUBSEQUENT REPORTS.--After the submission of the report under paragraph (1), the Secretary may submit such additional reports on the implementation of short-time compensation programs as the Secretary deems appropriate.
(3) FUNDING.--There are appropriated, out of any moneys in the Treasury not otherwise appropriated, to the Secretary, $1,500,000 to carry out this subsection, to remain available without fiscal year limitation.
(d) Conforming Amendments.--
(1) INTERNAL REVENUE CODE OF 1986.--
(A) Subparagraph (E) of section 3304(a)(4) of the Internal Revenue Code of 1986 is amended to read as follows:
"(E) amounts may be withdrawn for the payment of short-time compensation under a short-time compensation program (as defined in section 3306(v));".
(B) Subsection (f) of section 3306 of the Internal Revenue Code of 1986 is amended--
(i) by striking paragraph (5) (relating to short-term compensation) and inserting the following new paragraph:
"(5) amounts may be withdrawn for the payment of short-time compensation under a short-time compensation program (as defined in subsection (v));", and
(ii) by redesignating paragraph (5) (relating to self-employment assistance program) as paragraph (6).
(2) SOCIAL SECURITY ACT.--Section 303(a)(5) of the Social Security Act is amended by striking "the payment of short-time compensation under a plan approved by the Secretary of Labor" and inserting "the payment of short-time compensation under a short-time compensation program (as defined in section 3306(v) of the Internal Revenue Code of 1986)".
(3) REPEAL.--Subsections (b) through (d) of section 401 of the Unemployment Compensation Amendments of 1992 (26 U.S.C. 3304 note) are repealed.
(e) Effective Date.--The amendments made by this section shall take effect on the date of enactment of this Act.
SEC. 203. TEMPORARY FINANCING OF CERTAIN SHORT-TIME COMPENSATION PROGRAMS.
(a) Payments to States With Certified Programs.--
(1) IN GENERAL.--Not later than 30 days after the date of enactment of this Act, the Secretary of Labor (in this section referred to as the "Secretary") shall establish a program under which the Secretary shall make payments to any State unemployment trust fund to be used for the payment of unemployment compensation if the Secretary approves an application for certification submitted under paragraph (3) for such State to operate a short-time compensation program (as defined in section
3306(v) of the Internal Revenue Code of 1986 (as added by section 202(a))) which requires the maintenance of health and retirement employee benefits as described in paragraph (7) of such section 3306(v), in addition to other requirements of this Act and notwithstanding the otherwise effective date of such requirement.
(2) REIMBURSEMENT.--Subject to subsection (d), the payment to a State under paragraph (1) shall be an amount equal to 100 percent of the total amount of benefits paid to individuals by the State pursuant to the short-time compensation program during the weeks of unemployment--
(A) beginning on or after the date the certification is issued by the Secretary with respect to such program; and
(B) ending on or before December 31, 2011.
(3) CERTIFICATION REQUIREMENTS.--
(A) IN GENERAL.--Any State seeking full reimbursement under this subsection shall submit an application for certification at such time, in such manner, and complete with such information as the Secretary may require (whether by regulation or otherwise), including information relating to compliance with the requirements of paragraph (7) of such section 3306(v). The Secretary shall, within 30 days after receiving a complete application, notify the State agency of the State of the Secretary's
findings with respect to the requirements of such paragraph (7).
(B) FINDINGS.--If the Secretary finds that the short-time compensation program operated by the State meets the requirements of such paragraph (7), the Secretary shall certify such State's short-time compensation program thereby making such State eligible for reimbursement under this subsection.
(b) Timing of Application Submittals.--No application under subsection (a)(3) may be considered if submitted before the date of enactment of this Act or after the latest date necessary (as specified by the Secretary) to ensure that all payments under this section are made before December 31, 2011.
(c) Terms of Payments.--Payments made to a State under subsection (a)(1) shall be payable by way of reimbursement in such amounts as the Secretary estimates the State will be entitled to receive under this section for each calendar month, reduced or increased, as the case may be, by any amount by which the Secretary finds that the Secretary's estimates for any prior calendar month were greater or less than the amounts which should have been paid to the State. Such estimates may be made
on the basis of such statistical, sampling, or other method as may be agreed upon by the Secretary and the State agency of the State involved.
(d) Limitations.--
(1) GENERAL PAYMENT LIMITATIONS.--No payments shall be made to a State under this section for benefits paid to an individual by the State in excess of 26 weeks of benefits.
(2) EMPLOYER LIMITATIONS.--No payments shall be made to a State under this section for benefits paid to an individual by the State pursuant to a short-time compensation program if such individual is employed by an employer--
(A) whose workforce during the 3 months preceding the date of the submission of the employer's short-time compensation plan has been reduced by temporary layoffs of more than 20 percent; or
(B) on a seasonal, temporary, or intermittent basis.
(3) PROGRAM PAYMENT LIMITATION.--In making any payments to a State under this section pursuant to a short-time compensation program, the Secretary may limit the frequency of employer participation in such program.
(e) Retention Requirement.--
(1) IN GENERAL.--A participating employer under this section is required to comply with the terms of the written plan approved by the State agency and act in good faith to retain participating employees.
(2) OVERSIGHT AND MONITORING.--The Secretary shall establish an oversight and monitoring process by which State agencies will ensure that participating employers comply with the requirements of paragraph (1).
(f) Funding.--There are appropriated, from time to time, out of any moneys in the Treasury not otherwise appropriated, to the Secretary, such sums as the Secretary certifies are necessary to carry out this section (including to reimburse any additional administrative expenses by reason of the provision of, and amendments made by, this Act that are incurred by the States in operating such short-time compensation programs).
(g) Definition of State.--In this section, the term "State" includes the District of Columbia, the Commonwealth of Puerto Rico, and the Virgin Islands.
(h) Sunset.--The provisions of this section shall not apply after December 31, 2011.


(As printed in the Congressional Record for the Senate on Mar 8, 2010.)