BILL ANALYSIS
AB 2058
Page 1
ASSEMBLY THIRD READING
AB 2058 (Block)
As Amended May 28, 2010
2/3 vote. Urgency
INSURANCE 8-4 APPROPRIATIONS 12-5
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|Ayes:|Solorio, Caballero, |Ayes:|Fuentes, Ammiano, |
| |Charles Calderon, Carter, | |Bradford, |
| |Feuer, Hayashi, Salas | |Charles Calderon, Coto, |
| |Torres | |Davis, Monning, Ruskin, |
| | | |Skinner, Solorio, |
| | | |Torlakson, Torrico |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Blakeslee, Anderson, |Nays:|Conway, Harkey, Miller, |
| |Hagman, Niello | |Nielsen, Norby |
| | | | |
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SUMMARY : Modifies the requirements for participating in the
state's retraining benefits program in order to allow unemployed
people to receive unemployment insurance (UI) benefits while
enrolled in a training program on a full-time basis.
Specifically, this bill :
1)Declares the policy of this state to assist individuals with
unemployment insurance (UI) benefits if these individuals need
training to upgrade their skills to become competitive in the
labor market.
2)Provides that UI benefits shall not be denied to an otherwise
qualified unemployed worker because he or she is participating
in, or applying for, eligible training or retraining.
3)Requires a determination of automatic eligibility for
retraining benefits to be issued if the Director of the
Employment Development Department (EDD) finds the training is
authorized by the federal Workforce Investment Act, the state
Employment Training Panel, the federal Trade Acts of 1974 and
2002, the American Recovery and Reinvestment Act of 2009, the
individual is a participant in the California Work Opportunity
and Responsibility to Kids Program (CalWORKs), the individual
is a participant in training with a provider that is certified
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and on the state's Eligible Training Provider List, or the
individual is a journey level union member in industry-related
training that is necessary to employment.
4)Allows the EDD Director to find that an unemployed individual
is eligible for training benefits if federal extended UI
benefits are in effect, the unemployed individual is
determined potentially eligible for retraining benefits, and
the individual is enrolled in a community college or other
accredited postsecondary education program with the purpose of
preparing the applicant in academic or job skills that will
increase employment opportunities or that leads to an
industry-recognized credential or certificate designed for a
specific occupation.
5)Allows EDD to inform all UI claimants of the availability of
retraining benefits, by on-line means. This information shall
be made available on EDD's Web site in close proximity to
information on UI claim forms. Existing law already requires
this information to be conveyed verbally and in written form.
6)Provides that it is an urgency statute, allowing this bill to
take effect immediately upon enactment.
EXISTING LAW :
1)Declares the policy of this state to assist individuals with
UI benefits if these individuals need training in demand
occupations to become competitive in the labor market.
2)Provides that UI benefits shall not be denied to an otherwise
qualified unemployed worker because he or she is in training
approved by the EDD Director.
3)Allows an unemployed person who files a UI claim to apply to
EDD for a determination of potential eligibility for
"retraining benefits" during a period of training. Retraining
benefits allow people who qualify for UI benefits to
participate in training programs on a full-time basis and
receive UI benefits while being relieved of the obligations to
be available for work and to actively search for work each
week.
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4)Requires EDD to issue a determination of potential eligibility
for retraining benefits to an unemployed individual if the EDD
Director finds that the training is authorized by the federal
Workforce Investment Act, the state Employment Training Panel,
the federal Trade Act of 1974, as amended, or the individual
is a participant in CalWORKs and has entered into a contract
with the county welfare department to participate in an
education or training program.
5)Requires EDD to issue a determination of potential eligibility
for retraining benefits if the EDD Director finds that all of
the following facts apply:
a) The person has been unemployed for four or more
continuous weeks, or the person is unemployed and unlikely
to return to his or her most recent workplace because of a
plant closure or a substantial reduction in employment, or
because of a mental or physical disability which prohibits
the individual form utilizing existing occupational skills;
b) There is a lack of demand in the labor market area for
his or her occupational skills and the lack of employment
opportunities is expected to continue for an extended
period of time;
c) The training course of instruction relates to an
occupation or skill for which there are, or are expected to
be in the immediate future, reasonable employment
opportunities in the labor market area in this state in
which the individual intends to seek work;
d) If the person is a journey level union member, the
training course of instruction is specific job-related
training necessary due to changes in the technology, or
necessary to retain employment or to become more
competitive in obtaining employment;
e) The training or retraining course of instruction is one
approved by the EDD Director and can be completed within
one year;
f) The training or retraining course is a full-time course
prescribed for the primary purpose of training the
applicant in skills that will allow him or her to obtain
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immediate employment in a demand occupation and is not
primarily intended to meet the requirements of any degree
from a college, community college, or university;
g) The individual can be reasonably expected to complete
the training or retraining successfully; and,
h) The beginning date of training is more than three years
after the beginning date of training last approved for the
individual.
6)Provides that an unemployed individual receiving UI benefits,
who applies for retraining benefits no later than the 16th
week of receiving UI benefits, and is determined eligible for
the retraining benefits shall be entitled to a training
extension on his her UI claim to complete the approved
training.
7)Requires EDD to inform all UI claimants of the retraining
benefits. This information shall be conveyed verbally or in
written form.
8)Requires the training extension of UI benefits to be charged
to the employer reserve accounts.
9)Limits access to retraining benefits to instances when the EDD
Director finds that the person is potentially eligible for
retraining benefits or a training extension of UI benefits,
and the person submits with each claim a written certification
executed by a responsible person connected with the training
program certifying that the individual is enrolled in and
satisfactorily pursuing the training course of instruction.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, costs of $2.5 million to $5 million from the UI Trust
Fund (employer financed special fund) to increase enrollment in
the California Training Benefits Program.
COMMENTS :
1)The purpose of this bill is to allow unemployed workers
receiving UI benefits to continue their coverage while
enrolled in job training or education courses to develop the
skills necessary for the state's changing work environment.
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2)This bill affects "Retraining Benefits" (as phrased in
Unemployment Insurance Code Sections 1266 to 1274.10), or the
"California Training Benefits Program," as called by EDD on
its printed materials and its website. It is the same
program. The retraining benefits program allows people
receiving UI benefits to participate in approved training
programs without actively seeking work. EDD is responsible
for determining whether UI recipients are eligible for
retraining benefits and may continue to receive UI
compensation.
In May 2009, the U.S. Department of Labor issued a guidance
letter to state agencies such as EDD that administer the UI
Program. Specifically, Training and Employment Guidance
Letter No. 21-08 encourages states to widen the types of
training and the conditions under which education and training
are considered "approved training" for purposes of the state's
UI law. States are also asked to reconsider their laws and
regulations, and applicable administrative requirements, to
determine if their approved training requirements are
appropriate to the current economy. That guidance letter
strongly encourages states to
broaden their definition of approved training for UI
beneficiaries during economic downturns.
Currently, until a determination of eligibility for retraining
benefits is complete, EDD will suspend the UI benefits. With
the current severe recession, many unemployed Californians are
trying to regain competitive job skills by participating in
the California Training Benefits Program. Unfortunately, the
UI benefits of many Californians who indicate on an EDD form
that they're enrolled in training have their UI benefits
suspended for a period of 4 to 8 weeks. As a result, many
Californians decide to drop out of the job training to
preserve their eligibility for UI benefits. This is contrary
to the direction of the federal Department of Labor which has
been strongly encouraging states to streamline their
administrative procedures and laws, if necessary, to assist
unemployed people to regain competitive job skills for the
current economy. In fact, many people who experience a
suspension of UI benefits are found to have been eligible for
both UI and retraining benefits. This bill proposes a series
of statutory changes to improve training opportunities.
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3)According to the author, current law allows for the automatic
approval of training programs funded through the federal
Workforce Investment Act, federal Trade Acts, the state
Employment Training Panel, and CalWORKs. This bill will allow
unemployed workers who enroll in programs listed in the
Eligible Training Provider List, authorized by the federal
Workforce Investment Act, to automatically qualify for
California Training Benefits without causing a break in UI
benefits. This bill will also allow individuals to enroll in
community colleges or public universities to earn degrees or
certificates that will make them more employable and become
eligible for California Training Benefits.
4)The California Chamber of Commerce and the California
Manufacturers and Technology Association state their
opposition to this bill because it reaches further than timely
delivery of benefits and proposes to automatically approve
enrollment in training programs. These groups also state that
the bill would create a different public policy which could
lead to fraud and abuse since unemployed individuals could use
their UI benefits to make lifestyle changes beyond those
required for re-employment, regardless of real employment
opportunities.
5)This legislative session, AB 2748 (Furutani) proposes as state
policy that unemployed individuals be provided retraining
benefits made available under the federal American Recovery
and Reinvestment Act (ARRA) of 2009. Also, SB 968 (Negrete
McLeod) proposes a series of changes to the retraining
benefits program that are similar to those proposed by AB
2058.
Analysis Prepared by : Manny Hernandez / INS. / (916)
319-2086.
FN: 0004737