Explainer: How TAA works
Tuesday, March 22nd, 2011
Most white-collar employees won’t have heard of the Trade Adjustment Act, but for many blue-collar workers, it’s a familiar abbreviation. The program provides expanded benefits to workers who lose their jobs because of imports or offshoring — jobs lost because a company moves its factory overseas or starts importing a product that used to be made in the U.S.
The Trade Adjustment Act was passed in 1974, and for most of the act’s 26-year life, the parameters have been fairly narrow. Only workers who were in “article-producing” industries could qualify: people who made objects, essentially. As offshoring has moved from shoes and cars to software and back-office services, the act did not keep pace. A 2007 report by the Government Accountability Office found that some 40 percent of TAA petition denials were because the workers were not producing “articles,” as the law required then.
How TAA Works
To get trade adjustment assistance, the first step is submitting a petition to the Department of Labor. Applicants have to provide materials backing up their claim, which, for starters, means proof of layoffs or threatened layoffs. Then workers must show that imports of their product are up, the idea being that rising imports means fewer American goods bought, which in turn means layoffs. Or, they can show that their employer has moved the work they did to another country, a “shift of production,” in the language of the act.
Once a petition is certified, confirming that a company its losing jobs to trade, the laid-off workers get specific benefits, beyond the usual unemployment help. They can apply for training, as long as they have a “reasonable expectation of employment” with the new skills. The training is free, and they can get cash payments for each week they’re in a full-time training program, reimbursement of job-hunting costs and cash support if they relocate for a job.