White House Jobs Plan Might Let Businesses Train Unemployed Without Having To Pay Them
WASHINGTON -- As part of a forthcoming jobs package, the Obama administration is considering a program that would let businesses train jobless workers for a short period without having to pay or hire them.
The plan would be modeled on state programs, in particular one called Georgia Works, which allows Georgia businesses to give unemployed workers 24 hours of training per week for two months. Trainees receive a $240 stipend on top of unemployment benefits. The program is voluntary for businesses and workers laid off through no fault of their own and eligible for benefits. Its proponents say it encourages businesses to hire because it limits the risk of spending money to train a worker who might flop.
Georgia Department of Labor spokesman Sam Hall told HuffPost that since the initiative launched in 2003, more than 16,500 employers have participated. Of the nearly 24,000 workers who completed the program, 60 percent found jobs and 24 percent were hired by the employee that did the training.
Labor advocates worry that participants in Georgia Works are less trainees and more employees working for free.
"We understand that state departments of labor are looking for creative ways to get people into jobs," said Judy Conti, a lobbyist for the National Employment Law Project, a worker advocacy group. "We understand workers are desperate to get their foot in the door. But there's a right way to do it and we think Georgia's doing it the wrong way."
The Department of Labor has said that programs like Georgia Works must meet six criteria for workers to be classified as trainees. The two trickiest requirements are that the training has to be similar to what would occur in a classroom setting or vocational school and that the employer "derives no immediate advantage from the activities of the trainees, and on occasion the employer's operations may actually be impeded."
"Georgia works has been looked at by the U.S. Department of Labor and it meets all the requirements," Hall said.
Mike Thurmond, the former Georgia labor commissioner who created the program, acknowledged it's "a legitimate concern" that employers don't use the program to exploit workers, but he said Georgia Works has been thoroughly vetted and that it has safeguards.
"Employers who participate have to sign a document pledging not to violate federal and state labor laws," Thurmond said, also noting that workers know the initiative is completely voluntary.
Conti said NELP has interviewed workers who've participated in the program and found that their training was more like work. "People really aren't training for new skills," she said. "They are doing things they already know how to do."
Conti said a better jobs program would look more like the stimulus bill's Emergency Fund for the Temporary Assistance for Needy Families program. Economists at the liberal Center on Budget and Policy Priorities estimated the fund supported 240,000 jobs before Congress let it expire in 2010.
Shederica Edge, a 30-year-old resident of Columbus, Ga., said she'd been out of work for two months in 2009 after losing a customer service job when the state labor department contacted her about participating in Georgia Works. She said she spent six weeks training at a call center company called Prosperity America.
"They called me to see if I wanted to go out just to get a feel of the place," Edge said. "We did a six week training just to see if I would like doing this type of work, and then I got hired."
Her training, she said, involved doing plenty of real customer service: "We were actually working for six weeks." She said she is now handling patient accounts for a medical center client.
Company president Fred Landrum said Prosperity America opened for business two years ago "to provide an alternative to sending call center work overseas" and "to provide employment to former military members." (Edge said she served in the Air Force.)
Landrum praised Georgia Works, which he said has brought him dozens of trainees, 70 percent of whom have wound up as employees. He said that he knows some of the trainees who didn't stay wound up at other companies thanks partly to computer and telephone skills they picked up at Prosperity America.
"We can take those folks, train them, in some cases give people extra time because it's not costing us daily salary, and teach people who have never done this kind of work," he said. "It's reduced our training costs."
More than 30 states have looked at Georgia Works as a model. New Hampshire launched its own version, called Return to Work, in 2010. New Hampshire Employment Security Commissioner Tara Reardon said the program has been a success, resulting in 190 hires from 286 trainees.
"Trainees say they need to get their foot in the door so they can prove themselves, and businesses say they want to hire the right person," Reardon told HuffPost. "Employers get to make sure they get the right fit from the person they're training."
Reardon said her agency checks with both businesses and trainees to make sure labor standards are followed, and that all parties sign a contract that explains the rules. "We make it clear they need to be training, not working," she said.
The White House has said President Obama will announce a new jobs initiative after Labor Day but had no comment on specific plans. The Congressional Budget Office announced Wednesday that it expects the U.S. unemployment rate will remain above 8 percent through 2014.
HuffPost readers: Have you participated in Georgia Works or a similar program in another state? Tell us about it -- email firstname.lastname@example.org. Please include your phone number if you're willing to do an interview.