Worker Recovery Act (H.R. 3976)

Giving Gulf Coast Workers Greater Choice and More Control in their Job Search

October 6, 2005

A key component of President Bush’s recovery plan for displaced workers in the Gulf Coast region is the Worker Recovery Act.  This bill would create worker recovery accounts, which offer a new, innovative approach to providing displaced, unemployed Gulf Coast workers additional flexibility, greater choice, and more control over their employment search.  WRAs supplement and enhance the services that are already available for those who are most likely to face obstacles in finding and keeping new employment, from unemployment compensation benefits to core employment and training services offered through the Workforce Investment Act.

WRAs would provide up to $5,000 to help workers unemployed as a result of Hurricanes Katrina or Rita. 

• WRAs are personally managed funds targeted to help dislocated workers who are receiving Disaster Unemployment Assistance (DUA) or Unemployment Insurance (UI) and likely to exhaust these benefits.

• WRAs would be established and administered on their behalf by either the local one-stop career center or through a local partnership with private financial institutions.

• A similar concept – a personal reemployment account (PRA) pilot project to help unemployed Americans return to work quickly – was approved by the House as part of the Workforce Investment Act reauthorization bill (H.R. 27) on March 2, 2005.

• Moreover, since March 2005 the U.S. Department of Labor has commenced a similar worker account demonstration program in seven states.

WRAs could be used to purchase a variety of services to help individuals reenter the workforce, but program safeguards will ensure its integrity.

• A recipient of a WRA may purchase intensive (such as employment counseling), job training, or supportive (such as child care, uniforms, and transportation) services.

• WRAs would be efficiently administered through the easily accessible one-stop career center system, where the unemployed already seek assistance in obtaining employment.

• Administering the program through existing and highly-effective one-stop career centers also will allow for more reliable tracking of WRAs to protect the investment.

If an individual becomes employed within 13 weeks of receiving a WRA, the balance of the account up to $1,000 would be paid to the recipient.

• The balance would be paid out in two installments of 60 percent at the time of employment and 40 percent after six months of retaining a job. 

• WRA recipients who do not become reemployed by the 13th week from the date the account was established still can utilize the full amount of the account for training or supportive services.