JKM C.S.H.B. 1639 75(R)BILL ANALYSIS


ECONOMIC DEVELOPMENT
C.S.H.B. 1639
By: Raymond
4-1-97
Committee Report (Substituted)



BACKGROUND 

The federal Personal Responsibility and Reconciliation Act of 1996
requires states to provide 20 hours of work activities for 25 percent of
their public assistance recipients in fiscal year 1997. Work participation
requirements will increase 5 percent each year until 2002. In five years,
states must have 50 percent of welfare recipients working at least 30
hours a week -- about 88,000 Texans using current enrollment figures. 

In May 1996, Texas had 244,533 AFDC cases, 171,000 clients eligible for
JOBS, and 17, 262 clients who met federal guidelines for JOBS
participation. For fiscal year 1997, Texas will have to serve and provide
work activities for 29,000 more recipients of public assistance. 

PURPOSE

To create the Texans Work Program as an on-the-job training program for
recipients of public assistance; and establish the Texas employment and
training account to provide a stipend and benefits to trainees. 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill expressly grants rulemaking
authority to the Texas Workforce Commission in SECTION 1 of the bill by
adding Sec. 308.005 (a) to Subtitle B, Title 4, Labor Code, to implement
the program, including establishing criteria to determine which persons
may be required to participate in the program. 

SECTION BY SECTION ANALYSIS
 
SECTION 1.Amends Subtitle B, Title 4, Labor Code, by adding Chapter 308,
Texans Work Program.  
  
  Sec. 308.001  States that the legislative intent that this chapter is
enacted to enlist   employers in a partnership with the state to assist
recipients of public assistance in   developing marketable work skills and
obtaining employment. 
  
  Sec. 308.002 defines "division," "employer," "JOBS training program,"
"local   workforce development board," "program," "trainee," and "training
course." 

Section 308.003 establishes the Texans Work Program as an integrated
system of onthe-job training for certain people who receive food stamps
under Chapter 33, Human Resources Code, financial assistance under Chapter
31, Human Resources Code, and  are eligible to participate in the JOBS
training program.  The program shall be considered a means-tested program
and shall be operated by employers and offer work experience and skills
training.  The program shall be available in any part of the state in
which there is an employer willing to participate and is approved by the
local workforce development board or the division. 

Sec. 308.004(a) provides that training courses shall be designed by local
employers and must instruct the trainee in skills that use systems
specific to or produced by the employer's industry.  Subsection (b) states
that a course may not be less than six months or more than 12 months
unless approved by the division, and that courses length shall be based on
training needs.  Subsection (c) provides that an employer who participates
shall submit to the division a description of the employer's proposed
course.  The employer shall work with the division and the Skills
Standards Board to incorporate instruction in industry applicable skill
standards.  Courses must be approved by the commission. 

Sec. 308.005 provides for the powers and duties of the commission and the
division and guidelines for training course approval.  Subsection (a)
grants the commission rulemaking authority necessary to implement the
program, including establishing criteria for determining eligible
participants.  Subsection (b) states that the commission shall develop
guidelines, in cooperation with the Skills Standards Board, for the
approval of training courses.  Subsection (c) requires the commission to
develop guidelines  that condition approval on the expectation that a
participating employer will develop job descriptions that are relevant to
regular paid positions in the employer's workplace or that are available
in the community in which the employer is located.   Requires that the
commission shall consider the following when determining whether to
approve a particular training course:  the administrative burden imposed
by participation in the program by the participating employer; whether the
proposed training may reasonably be expected to enhance the employability
of individual trainees; whether the proposed training produces a realistic
and usable level of skills; whether the training is composed of a greater
ratio of training-to-work than regular employees under analogous
conditions; whether the employer has any intention of retaining successful
trainees as regular employees; the extent to which the proposed training
includes nonspecific work skills; and if the employer has previously
participated in the program.  Subsection (d) authorizes the commission to
develop incentives for employers who have completed the training course to
hire  for  at least a year employees who have completed the course. 
  
  Sec. 308.006 requires the Texas Department of Human Services to provide
to the   commission and a local workforce board information and technical
assistance as   necessary to implement the program. 
  
  Sec. 308.007  provides that participating employers shall provide job
training under   contract with the local workforce development board or
the commission; the   employer shall select trainees from a list of
eligible participants; the employer selects   training methods as long as
those methods teach applicable skills at applicable   standards; the
employer is not liable for payment of payroll and unemployment
compensation taxes or benefits and is responsible only for quality
training, skills   certification, and reporting of attendance; and that
the employer shall pay $300 per   month per trainee to the commission,
which shall deposit the money in the general   revenue fund to the credit
of the Texas employment and training account.  Subsection    (f) states
that  a trainee is considered an employee of the employer for the purposes
of Section 401.012, Labor Code. 

  Sec. 308.008 makes provisions to prevent regular employees from being
replaced by  
  temporary trainees in the Texans work Program.  Subsection (a) requires
that, except   as provided by Subsection (b), not more than 20 percent of
an employer's workforce   may consist of trainees under the program,
unless, as provided by Subsection (b), an   employer has fewer than 50
employees.  Subsection (c) requires an employer with   regular employees
subject to a collective bargaining agreement to notify the   applicable
collective bargaining agent of the employer's intent to participate in the
program. Subsection (d) lays out the circumstances in which a
participating employer   may not accept a trainee for participation in a
training course conducted under the   program. 

Sec. 308.009 Requires each trainee participant in the program to work
during the training course not less than the minimum number of hours
required under federal law for work participation for public assistance
recipients.  States that each trainee is entitled to the rights provided
under Chapters 21 and 101 as if the trainee were a regular employee, and
participation in an administrative dispute resolution procedure by the
commission for grievances involving participation in the program.
Requires that a skill standards certification be given to each trainee
upon successful completion of a training course offered under the program. 

Sec. 308.010 establishes the Texas employment and training account,
composed of employer contributions and state matching funds obtained
through the block grant received under the JOBS training program, in the
general revenue fund.  The money in the fund may be used only for paying
training stipends and other training activities authorized by the program. 

 Sec. 308.011 provides for the payment of training stipends.  Subsection
(a) states that each trainee who demonstrates satisfactory participation
shall be paid a monthly stipend.  Subsection (b) states the stipends is
composed of $600 from the employment and training account and the amount
of benefits the trainee is eligible to receive in public assistance.
Subsection (c) states that the training stipend will be transferred into
the trainees electronic benefits transfer account, if this method is
determined by the Texas Department of Human Services to be cost-effective.
Subsection (d) declares that the training stipend is not income for the
purposes of determining eligibility for and the amount of benefits
received under Chapter 31, Human Resources Code; that a trainee who
participates in the program is entitled to full public assistance
benefits; and that a trainee who quits before the conclusion of the course
loses eligibility for training stipends and JOBS benefits but remains
eligible for other public assistance.  Subsection (e) states that a
trainee with excessive unexcused absences may have the training stipend
reduced by the commission. Subsection (f) requires the training stipend to
be paid on the first workday of each month.   

  Sec. 308.12 Requires the commission to collect information and maintain
records   regarding the operation and outcome of the program, impediments
identified that   affect the successful operation of the program, and
complaints or other comments   regarding the program received by the
commission from employers, trainees, regular   employees, and local
workforce development boards.  States that this information is   a public
record, and requires the commission to report to the 76th Legislature not
later   than January 31, 1999 regarding this information.  Expiration date
for this subsection   is March 1, 1999. 

SECTION 2.Amends Subchapter A, Chapter 31, Human Resources Code, by adding
Section 31.0037 stipulating that the department may not consider income
earned by a participant in Texans Work in determining the amount of
financial assistance granted to a trainee for the support of dependent
children or whether the family meets household income resource
requirements for financial assistance. 


SECTION 3. Sec. 401.012 (b), Labor Code, is amended by adding that a
person who is     a trainee in the Texans Work Program, as defined in
Section 308.001, Labor Code,   is included in the definition of
"employee." 

SECTION 4.Provides that, if a state agency determines that a provision of
the act requires a waiver or authorization from the federal government to
implement the program, the agency shall request the waiver or
authorization and may delay implementing the provision until the waiver or
authorization is granted. 

SECTION 5.States this Act applies only to a person who receives public
assistance on or after the effective date of the Act, regardless of the
date on which eligibility was determined. 

SECTION 6.Effective date.

SECTION 7.Emergency clause.

COMPARISON OF ORIGINAL TO SUBSTITUTE

SECTION 1.  CSHB 1639 adds a new Sec. 308.001 that states the legislative
intent.  Subsequent   sections are renumbered and conforming changes are
made accordingly.   

  CSHB 1639 adds to Sec. 308.003 TEXANS WORK PROGRAM (was Sec. 308.002
of HB 1639) the requirement that the program be "a means-tested program". 
  
  CSHB 1639 Sec. 308.004 (c) makes conforming changes.
 
  CSHB 1639 Sec. 308.005 (Sec. 308.004 of HB 1639) changes the title of
the Section   by adding "GUIDELINES FOR TRAINING COURSE APPROVAL".  Makes
conforming changes.  HB 1639 Subsection (c) is replaced with CSHB 1639
Subsection (c) that determines factors the commission shall base approval
on when   developing guidelines under  CSHB 1639 Subsection (b).  CSHB
1639 Subsection   (c) adds specific items the commission shall consider
when determining to approve   a particular training course.  CSHB 1639
adds Subsection (d) which authorizes the   commission to develop
incentives for employers to hire participants who have   completed a
training course. 

  CSHB 1639 adds a new Sec. 308.006 POWERS AND DUTIES OF THE TEXAS
DEPARTMENT OF HUMAN SERVICES which contains the same language that   was
in HB 1639 Sec. 308.004, Subsection (c).  Directs the Texas Department of
Human Services to provide the commission and a local workforce development
board   with information and assistance as necessary to implement the
program.  CSHB 1639  renumbers following sections, beginning with the
"RIGHTS AND DUTIES OF    PARTICIPATING EMPLOYER". 

 CSHB 1639 Sec. 308.007 Subsection (d) (was HB 1639 Sec. 308.005,
Subsection (d) )  strikes "workers' compensation coverage" from a list of
items a participating employer is not  obligated to provide.  CSHB 1639
adds a new Subsection (f) that states a trainee is  considered an employee
of the employer for the purposes of Section 401.012, Labor Code. 

 CSHB 1639 adds a new Sec. 308.008  RIGHTS OF REGULAR EMPLOYEES which
makes  provisions to prevent regular employees from being replaced by
temporary trainees in the  Texans work Program.  Requires that, except as
provided by Subsection (b), not more than  20 percent of an employer's
workforce may consist of trainees under the program, unless an  employer
has fewer than 50 employees.  Requires an employer with regular employees
subject to a collective bargaining agreement to notify the applicable
collective bargaining  agent of the employer's intent to participate in
the program.  Lays out the circumstances in  which a participating
employer may not accept a trainee for participation in a training course
conducted under the program. 

 CSHB 1639 adds a more detailed Sec. 308.009 RIGHTS AND DUTIES OF
PARTICIPATING TRAINEES (was  HB 1639, Sec. 308.006) that requires each
trainee  participant in the program to work during the training course not
less than the minimum  number of hours required under federal law for work
participation for public assistance  recipients.  States that each trainee
is entitled to the rights provided under Chapters 21 and  101 as if the
trainee were a regular employee, and participation in an administrative
dispute  resolution procedure  by the commission for grievances involving
participation in the  program.  Requires that a skill standards
certification be given to each trainee upon successful  completion of a
training course offered under the program. 

 CSHB 1639 Sec. 308.011 (was HB 1639 Sec. 308.008) makes changes in
Subsection (b) to  eliminate the need for subsections.  CSHB 1639
Subsection (c) allows the Texas Department  of Human Services to
electronically transfer benefits if the department determines the  method
of electronic benefits transfer to be cost effective.  CSHB 1639
Subsection (d) states  that the stipend does not constitute income to the
trainee and adds to this statement "for  purposes of determining
eligibility for and the amount of benefits received under Chapter 31,
Human Resource Code."  CSHB 1639 adds a new Subsection (f) which requires
the training  stipend to be paid on the first of each month. 

 CSHB 1639 adds a new Sec. 308.012 REPORTS; RECORDS which requires the
commission  to maintain records for public review on the operation and
outcome of the program,  impediments to the program, and complaints, as
well as report this information to the 76th  Legislature. 

 CSHB 1639 adds a new SECTION 3 to amend Sec. 401.012 (b), Labor Code by
adding  Subsection 3 to include in the definition of "employee" "a person
who is a trainee in the  Texans Work Program, as that term is defined in
Section 308.001, Labor Code."  CSHB 1639  renumbers following sections
accordingly.