Trade Adjustment Assistance for Workers (TAA) and Reemployment Trade Adjustment Assistance (RTAA)

Trade Adjustment Assistance for Workers (TAA) and Reemployment Trade Adjustment Assistance (RTAA)

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Trade Adjustment Assistance for Workers
(TAA) and Reemployment Trade Adjustment
Assistance (RTAA)
John J. Topoleski
Analyst in Income Security
January 7, 2011
Congressional Research Service
7-5700
www.crs.gov
RS22718
CRS Report for Congress
P
repared for Members and Committees of Congress
c11173008

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TAA and RTAA

Summary
Trade Adjustment Assistance for Workers (TAA) provides assistance to qualifying workers who
lose their jobs directly due to increased imports or shifts in production out of the United States.
Certified workers whose unemployment compensation has ended and who are in approved
training may receive income support payments (Trade Readjustment Allowances, or TRA) for a
maximum of 156 weeks. Some workers age 50 or older are eligible to receive Reemployment
Trade Adjustment Assistance (RTAA), a wage supplement program. Both TAA- and RTAA-
eligible workers can receive a Health Coverage Tax Credit (HCTC), which provides a refundable
tax credit to offset 80% of the health insurance premiums of TAA- and RTAA-eligible workers.
This report provides background on the programs, including a description of the eligibility for
these programs and benefits available to participants. It also describes the main changes to the
program with the reauthorization and expansion of TAA in the American Recovery and
Reinvestment Act of 2009 (ARRA; P.L. 111-5), which was signed into law by President Barack
Obama on February 17, 2009. The changes made by ARRA were to expire on December 31,
2010. H.R. 6517, the Omnibus Trade Act of 2010, extended the changes made by ARRA though
February 12, 2011. H.R. 6517 passed the House and the Senate on December 22, 2010.
This report will be updated as legislative activity warrants.
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Contents
Background ................................................................................................................................ 1
Financing.................................................................................................................................... 1
Administration ............................................................................................................................ 2
Trade Adjustment Assistance Benefits ......................................................................................... 2
Income Support (Trade Readjustment Allowances)................................................................ 2
Training Assistance ............................................................................................................... 2
Job Search and Relocation Assistance ................................................................................... 3
Reemployment Trade Adjustment Assistance Benefits................................................................. 3
Health Coverage Tax Credit Benefit ............................................................................................ 3
Eligibility.................................................................................................................................... 4
TAA Group Eligibility........................................................................................................... 4
TAA Individual Eligibility..................................................................................................... 5
RTAA Group Eligibility ........................................................................................................ 5
RTAA Individual Eligibility .................................................................................................. 5
Participation................................................................................................................................ 6
Changes to TAA Due to Reauthorization ..................................................................................... 7
Expiration of TAA Expansions Under ARRA .............................................................................. 8

Tables
Table 1. Petitions and Certifications, FY2003-FY2009 ................................................................ 6
Table 2. Selected Statistics on TAA Benefits, FY2003-FY2009 ................................................... 7

Contacts
Author Contact Information ........................................................................................................ 9

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Background
Trade Adjustment Assistance for Workers (TAA) provides extended income support as well as
training, job search, and relocation benefits.1 To be eligible for TAA, workers must have become
unemployed for one of three reasons: (1) their jobs moved to another country; (2) their job losses
can be attributed to increased imports that contributed importantly to an actual decline in sales or
production; or (3) their job losses resulted from the loss of business with a primary firm because
of a trade-related reason. Older TAA-eligible workers may be able to opt for Reemployment
Trade Adjustment Assistance (RTAA), which provides a wage supplement in lieu of TAA
benefits. In addition, workers can claim a refundable Health Coverage Tax Credit (HCTC). The
HCTC was established to help both eligible TAA and RTAA workers pay for health insurance.2
TAA was formally established by the Trade Expansion Act of 1962 (P.L. 87-794) but was little
used until the Trade Act of 1974 (P.L. 93-618) expanded benefits and eligibility. Most recently,
the Trade Act of 2002 (P.L. 107-210) established RTAA and reauthorized and expanded TAA.
TAA and RTAA were set to expire December 31, 2007. The House passed a three-month
extension (H.R. 4341) by a voice vote. However, the Senate did not act on the measure. The
Consolidated Appropriations Act, 2008 (P.L. 110-161, signed by President George W. Bush on
December 26, 2007) contained an appropriation for the TAA for Workers and RTAA programs
that fully funded the programs for FY2008.3 The Consolidated Security, Disaster Assistance, and
Continuing Appropriations Act, 2009 (P.L. 110-329) fully funds the TAA and RTAA programs
through March 6, 2009, and specified that the programs will continue through this date. The
American Recovery and Reinvestment Act of 2009 (ARRA; P.L. 111-5, which was signed into
law by President Barack Obama on February 17, 2009) reauthorized and expanded TAA.
Authorization for the changes made by ARRA were set to expire on December 31, 2010. H.R.
6517, the Omnibus Trade Act of 2010, extended the changes made by ARRA though February 12,
2011. H.R. 6517 passed the House and the Senate on December 22, 2010.
Financing
TAA financing has several components. Trade Readjustment Allowances (TRA) funds for
extended unemployment benefits are appropriated as an entitlement out of general revenue (not
out of the Unemployment Trust Fund). TRA benefits are provided to all workers who meet
eligibility requirements. In FY2010, $1.1 billion was appropriated for TRA benefits. Funds for
training, job search and relocation expenses, and administrative costs are a line item appropriation
of which training is a capped entitlement. The TAA statute authorizes $575 million for training.
The RTAA is appropriated as an entitlement out of the general fund. In FY2010, $65.0 million
was appropriated for RTAA. HCTC is funded out of general revenue.

1 Other Trade Adjustment Assistance available is TAA for Firms (see CRS Report RS20210, Trade Adjustment
Assistance for Firms: Economic, Program, and Policy Issues, by J. F. Hornbeck), and TAA for Farmers (see CRS
Report R40206, Trade Adjustment Assistance for Farmers, by Remy Jurenas).
2 For more information, see CRS Report RL32620, Health Coverage Tax Credit, by Bernadette Fernandez.
3 For more information see CRS Report RL34383, Trade Adjustment Assistance (TAA) for Workers: Current Issues and
Legislation, by John J. Topoleski.
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Administration
At the federal level, the TAA and RTAA programs are administered by the Office of Trade
Adjustment Assistance within the U.S. Department of Labor (DOL). Claims for benefits by
individual workers are administered by the state Unemployment Compensation (UC) agencies
under agreements and contracts with DOL. The use of funds varies greatly from year to year and
from state to state.
Trade Adjustment Assistance Benefits
TAA benefits, which are primarily focused on the re-employment of certified workers, have
several components: up to 156 weeks of income support while in training; training assistance; and
job search and relocation assistance.
Income Support (Trade Readjustment Allowances)
Workers have both basic and additional TRA available to them and can receive up to 156 weeks
of income support.
• Basic TRA. Workers receive basic TRA after their UC benefits are exhausted.
The weekly TRA payment is equal to the worker’s most recent UC benefit. The
total amount of basic TRA benefits available to a worker is equal to 52 times the
weekly TRA benefit minus the total amount of UC benefits. For example, a
worker who receives 26 weeks of UC would be eligible to receive an additional
26 weeks of basic TRA.4 To receive the basic TRA benefit, workers must be
enrolled or participating in TAA-approved training, have completed such
training, or have obtained a waiver of the training requirement.5
• Additional TRA. An additional 78 weeks of income support is available for
workers who are enrolled in TAA-approved training programs, plus another 26
weeks are available for workers in remedial training programs. A worker cannot
receive a waiver of the training requirement to receive additional TRA.
Training Assistance
Workers’ training assistance is for full-time participation in an approved training program.
Approved training programs include, but are not limited to, employer-based training, including
customized training and on-the-job training; any training program provided by a state pursuant to
Title I of the Workforce Investment Act of 1998 (WIA; P.L. 105-220); any training program

4 Amounts of Emergency Unemployment Compensation or Extended Benefits (EB) offset the amount of Basic TRA for
which a worker is eligible. For example, a worker that receives 13 weeks of EB in addition to the usual 26 weeks of UC
would be entitled to receive 13 weeks of Basic TRA.
5 Reasons for a training waiver include the following: the worker will be recalled reasonably soon, the worker has
marketable skills for suitable employment and a reasonable expectation of employment, the worker is within two years
of eligibility for a pension or Social Security, the worker is unable to participate in or complete training for health
reasons, the worker cannot enroll in training immediately, or the worker cannot find a suitable training program.
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approved by a private industry council under Section 102 of WIA; a program of prerequisite
education; a training program or coursework at an accredited higher education institution; or any
training program for which all, or any portion, of the costs are paid (1) under a federal or state
program or (2) from any other source. According to DOL, between July 2006 and June 2007 the
average number of weeks of training per participant was 63, and 72% of participants completed
training.
Job Search and Relocation Assistance
Certified workers who cannot obtain suitable employment within their commuting areas can
receive an allowance of 100% of their job search and relocation expenses, up to a maximum of
$1,500 for each benefit. Less than 1% of TAA-eligible workers receive these benefits.
• Job Search Allowance. Applications must be submitted before a job search
begins and made by the 365th day after certification or final separation
(whichever is later) or within 182 days of the end of training.
• Relocation Expenses. Applications must be submitted before the relocation
occurs and made within 425 days of certification or layoff (whichever is later) or
within 182 days of the end of training. The relocation must occur within 182 days
of filing the application for relocation assistance or within 182 days after the
conclusion of training.
Reemployment Trade Adjustment Assistance
Benefits
Workers who qualify for the RTAA benefit can receive a wage supplement worth half the
difference in salary between their old and new jobs for a maximum of $12,000 over two years.
Although workers are ineligible if their wages are more than $55,000 a year, their combined
wages and RTAA payments can exceed $55,000 a year. For example, a worker who earned
$58,000 at a previous job and earns $53,000 at a new job would be eligible for a benefit of $2,500
per year for two years. In this case, the worker would receive a total of $55,500 per year (for two
years) in wages and RTAA benefits.
Health Coverage Tax Credit Benefit
HCTC is available to TAA and RTAA workers. The HCTC covers 80% of the premium for
qualified health insurance purchased by an eligible taxpayer (the taxpayer is responsible for the
other 20%). It is refundable, so workers may claim the full credit even if they have little or no
federal income tax liability. The credit may also be advanced, so taxpayers have the option of
using the credit on a monthly basis when premiums are due rather than waiting until the end of
the year. Individuals may receive the HCTC for one month longer than their TAA eligibility or
exactly two years in the case of their RTAA eligibility.
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Eligibility
Obtaining TAA or RTAA benefits is a two-stage process: (1) a group of workers must petition
DOL to become TAA certified. A group of workers that is TAA certified is automatically certified
for RTAA; and (2) individual workers apply for TAA or RTAA benefits at a local One-Stop
Career Center.
TAA Group Eligibility
To gain TAA eligibility, a group of three or more workers (or their union, firm, or state) petitions
DOL. Then, DOL investigates whether import competition “contributed importantly” to the
group’s job loss or whether their firm has shifted their jobs to a foreign country. TAA also extends
eligibility to groups of secondary workers whose job losses result from the loss of business with a
primary firm (i.e., the firm that directly lost business or outsourced as a result of trade).
Certification of the petition requires that firms meet one of several criteria.
In the case of a firm that shifts production to a foreign country, certification requires the
following:
• A significant number of workers6 are laid off or threatened with layoffs;
• Either (1) a shift in the production of articles or services like or directly
competitive with those produced by the workers’ firm to a foreign country, or (2)
the workers’ firm has acquired the articles or services from a foreign country; and
• The shift in production or acquisition of foreign goods or services contributed
importantly to the workers’ separation.
In the case of a firm that does not shift production to a foreign country, certification requires the
following:
• A significant number of workers are laid off or threatened with layoffs;
• The sales or production of the firm decreased; and
• Increased imports of (1) articles or services competitive with the firm’s articles or
service or (2) articles which are competitive with the articles in which the firm’s
products or services are component parts or services have “contributed
importantly” to the decline in sales or production.
In the case of public sector workers, certification requires the following:
• A significant number of workers in the public agency are laid off or threatened
with layoffs;
• The public agency has acquired like or competitive services from a foreign
country, and

6 DOL regulations (see 20 C.F.R. § 90.2) define significant to mean that the group of workers must contain at least 3
workers if the firm had less than 50 workers, or 5% of total workers if the firm had 50 or more workers.
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• The acquisition of the services contributed importantly to the workers’
separation.
In the case of adversely affected secondary workers, certification requires the following:
• A significant number of workers are laid off or threatened with layoffs;
• The workers’ firm is a supplier or downstream producer to a TAA-certified firm;
and;
• Either (1) the sales or production to the TAA-certified firm accounted for at least
20% of the sales or production of the supplier firm or (2) the loss of sales to the
TAA-certified firm contributed importantly to the workers’ job losses.
The determination on a TAA petition must be made by DOL within 40 days of filing. Generally,
the certification covers all members of the worker group who are laid off during the three-year
period beginning one year before the petition was filed (the impact date) and ending two years
after the date of the certification. Determinations on TAA petitions are published in the Federal
Register and on the DOL website. Workers who are denied certification may request
administrative reconsideration by DOL. Reconsideration requests must be mailed within 30 days
of Federal Register publication. Workers who are denied certification may seek judicial review of
DOL’s initial petition denial or denial following administrative reconsideration. Appeals for
judicial review must be filed with U.S. Court of International Trade within 60 days of Federal
Register publication of the initial denial or administrative reconsideration denial.
TAA Individual Eligibility
If DOL certifies a petitioner’s group of workers as eligible, the individual workers then apply to
their state agency to establish a TAA benefit claim. For an individual worker, eligibility is based
on all of the following: (1) separation from the firm on or after the impact date specified in the
certification but within two years of DOL certification; (2) employment with the affected firm in
at least 26 of the 52 weeks preceding layoff; (3) entitlement to state UC benefits; (4) no
disqualification for extended unemployment benefits; and (5) enrollment or a waiver for
participation in an approved training program. Certified workers who are denied individual
benefits can appeal the decision. The determination notice that certified workers receive after
filing their applications for each benefit will explain their appeal rights and time limits for filing
appeals.
RTAA Group Eligibility
A group of workers certified for TAA eligibility are eligible for RTAA as well. Neither separate
petitions nor separate certifications are required for RTAA.
RTAA Individual Eligibility
If DOL certifies a group as TAA and RTAA eligible, then an individual worker must meet the
following requirements:
• be at least 50 years old at the time of reemployment and
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• obtain full-time employment earning less than $55,000 per year by sooner of the
exhaustion of unemployment compensation or during any point in which the
worker is receiving TRA. This allows a worker to shift from receiving TRA to
receiving RTAA.
Participation
Table 1 includes data on TAA petitions and certifications for FY2003 to FY2009. The numbers
do not exhibit a particular trend over time because the number of petitions depends on the
episodic nature of layoffs, especially within a particular state.7 Factors that could explain the
increase in petitions and certifications in FY2009 include the recession beginning in December
2007 and the expansion of TAA eligibility beginning in May 2009.
Table 1. Petitions and Certifications, FY2003-FY2009
Petitions
Filed Petitions Certified
Estimated
Estimated
Fiscal Year
Petitions
Workers Number Percentage Workers
2003 3,567 292,827 1,880 53% 197,359
2004 2,992 171,281 1,802 60% 149,705
2005 2,638 164,371 1,534 58% 118,022
2006 2,478 172,651 1,426 57% 119,602
2007 2,228 190,430 1,427 64% 146,606
2008 2,146 162,629 1,368 64% 125,529
2009 2,295 243,208 1,844 80% 201,094
Source: CRS table from data provided by the U.S. Department of Labor, Employment and Training
Administration.
Table 2 includes data on TAA benefits for FY2003 to FY2009. The number of new recipients of
basic TRA has declined each year since 2004. The reporting requirements were changed
beginning in FY2007, therefore, FY2007 and FY2008 data for number of workers who entered
training may not be comparable to previous years.
In FY2009, a total amount of $19 million was received by 6,827 participants in RTAA wage
supplement program.

7 For example, the Government Accountability Office notes that Kansas had 4,117 trade-affected workers laid off in
2004, 75 in 2006, and 721 in 2007. See GAO-07-994T, Trade Adjustment Assistance: Program Provides an Array of
Benefits and Services to Trade-Affected Workers, June 14, 2007, available at http://www.gao.gov/new.items/
d07995t.pdf.
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Table 2. Selected Statistics on TAA Benefits, FY2003-FY2009

Trade Readjustment Allowance
Training, Job Search, Relocation Allowances
New
Average
Recipients
Weekly
Total TRA
Total
Fiscal
of Basic
Basic TRA
Outlays
Entered
Job
Re-
Outlays
Year
TRA
Payment ($)
($millions)
Training
Search
location
($ millions)
2003
44,000 238 352 44,000
430 736 259
2004
81,000 262 530 51,000
467 817 259
2005
55,000 267 598 38,000
288 446 259
2006
53,000 289 529 37,000
454 531 259
2007
47,000 329 572 44,000
399 750 259
2008
42,000 310 509 38,000
405 757 259
2009 na
na
na 58,000 617 682 259
Source: Table provided to CRS by U.S. Department of Labor, Employment and Training Administration.
Note: na indicates that data are not available.
Changes to TAA Due to Reauthorization
The American Recovery and Reinvestment Act of 2009 (ARRA, P.L. 111-5) reauthorized and
expanded TAA and was signed into law by President Barack Obama on February 17, 2009. The
act went into effect May 18, 2009, which was 90 days after enactment. The provisions enacted by
ARRA are as follows:
• Extended TAA eligibility to service and public sector workers. Prior law required
that workers produce an article to be eligible for TAA.
• Extended TAA eligibility to suppliers of component parts if the supplier
experiences job losses for a trade-related reason regardless of whether the
downstream producer is a TAA-certified firm. Prior law allowed suppliers of
component parts to be certified for TAA only if the downstream producer was
certified for TAA.
• Allowed TAA eligibility due to shifts in production to any country. Prior law
required that firms shift production to countries with which the United States has
a free-trade or beneficial trading agreement.
• Allowed workers to receive Additional TRA (income support payments) for an
additional 26 weeks (for a total of 78 weeks), provided the workers are in
training. Prior law allowed workers to receive Additional TRA for up to 52
weeks, provided the workers were in training.
• Extended the deadline for enrolling in training to the later of 26 weeks from the
date of TAA certification or the date of separation from employment. Prior law
required workers to enroll in training the later of 8 weeks after TAA certification
or 16 weeks after separation from employment.
• Increased training funding to $575 million per fiscal year. Prior law authorized
$220 million per fiscal year for workers’ training.
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• Required DOL to disburse training funds to states based on at least five factors;
distribute at least 65% of the training funds in the initial distribution; and to
disburse to a state no less than 25% of the prior year’s initial distribution. Prior
law did not specify any method for training funds to be allocated to states. In
practice, DOL initially disbursed 75% of training funds based on a state’s accrued
training expenditures and the number of training participants over the previous
two and one-half years, and disbursed to a state no less than 85% of the prior
year’s initial distribution.
• Increased the amount reimbursed for job search and relocation expenses to 100%
of a worker’s expenses up to $1,500 for each type of expense. Prior law limited
reimbursement for job search and relocation expenses to 90% of a worker’s
expenses up to $1,250 for each type of expense.
• Continued the wage insurance program for older workers as RTAA. Prior law
established Alternative Trade Adjustment Assistance (ATAA) for older workers
as a five-year demonstration project.
• Eliminated the separate petition process for eligibility for the wage insurance
program. Prior law required a separate ATAA petition to be filed concurrently
with the TAA petition.
• Allowed older workers to be eligible for RTAA for up to two years after the
exhaustion of regular unemployment benefits or reemployment. The new law
allowed workers participating in TAA-approved training to receive wage
insurance if they switch from receiving TRA while in training to receiving
RTAA. Prior law required workers to find reemployment within 26 weeks of
separation and also prohibited workers who receive TRA from receiving wage
insurance.
• Increased the limit on wages to be eligible for reemployment assistance to
$55,000 per year and increased the maximum wage insurance benefit to $12,000
over two years. Prior law limited eligibility to workers with reemployment wages
less than $50,000 and limited the maximum benefit to $10,000 over two years.
• Established an Office of Trade Adjustment Assistance in DOL to be headed by an
administrator who will report directly to the Deputy Assistant Director for
Employment and Training. Under prior law, TAA was administered as part of the
Office of National Response.
• Increased the HCTC to 80% of a worker’s qualified health insurance premiums
beginning April 18, 2009. Prior law covered 65% of a worker’s qualified health
insurance premiums.
• Authorized TAA and RTAA through December 31, 2010. H.R. 6517, which
passed the House and Senate on December 22, 2010, extended the TAA program
as expanded by ARRA through February 12, 2011.
Expiration of TAA Expansions Under ARRA
The provisions in ARRA that expanded benefit eligibility under the TAA program were scheduled
to sunset on December 31, 2010. In addition, ARRA provided that on January 1, 2011, the TAA
program be administered as if the provisions of ARRA had not been enacted, although workers
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covered by petitions filed before January 1, 2011, would receive benefits under the TAA program
as expanded by ARRA. Finally, ARRA provided that the authorization for the TAA program
would expire on December 31, 2011.
H.R. 6517, the Omnibus Trade Act of 2010, extended the provisions of the TAA program as
enacted by ARRA though February 12, 2011. H.R. 6517 passed the House and the Senate on
December 22, 2010, and was signed by President Barack Obama on December 29, 2010.

Author Contact Information

John J. Topoleski

Analyst in Income Security
jtopoleski@crs.loc.gov, 7-2290

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