Trade Adjustment Assistance Program Helps More Than Laid Off U.S. Factory Workers

Many will be surprised who else the Trade Adjustment Assistance program helps.

Laid off bank workers get blue-collar benefits

By Tim McLaughlin
Reuters

When President Barack Obama recently reauthorized benefits for the Trade Adjustment Assistance program, the White House emphasized it would help U.S. factory workers who have lost their jobs to overseas competition.

What many don’t realize, however, is that Obama’s move also helped back-office workers laid off by Wall Street and financial services companies. Obama restored benefits that expired in February and led to months of denied claims for unemployed financial services workers.

In the past two years, laid off workers from Bank of America Corp, JP Morgan Chase & Company Inc, UBS AG, Hartford Financial Services Group, Wells Fargo & Co and State Street Corp have filed for benefits under the U.S. Labor Department’s Trade Adjustment Assistance program. In many cases, these claims have been approved.

The program, nearing its 50th year, is typically thought of as existing for laid off assembly line workers.

But thanks to a 2009 change to the TAA program, back-office workers in the financial services industry can get retraining and extend their unemployment insurance beyond the maximum amount of 99 weeks to about 130 weeks, in some cases. The 2009 reform targeted “secondary workers” affected by plant closings.

It also created an opening for workers laid off by banks and other companies in the financial services industry.

Of the 187 petitions filed on behalf of laid off financial services workers, about 77 percent of the claims received Labor Department approval, said Howard Rosen, executive director of the Trade Adjustment Assistance Coalition. Those petitions accounted for about 3 percent of annual approvals.

“For the most part, people in the financial services industry don’t know about the program,” Rosen said. “In the past, unions filed claims on behalf of workers.”

But word is getting out. What’s more, a slumping U.S. economy has created good conditions for job cuts and outsourcing of back-office tasks. JPMorgan workers in Columbus, Ohio, for example, qualified for benefits after the bank moved their jobs to India, according to a petition certified by the Labor Department.

That came as a surprise to JPMorgan, which says it has been on a hiring binge, adding 13,000 net jobs in 2011. In Columbus, the bank said it has hired 2,000 in that city this year.

A typical case for Trade Adjustment Assistance is a person on an assembly line who makes something, but their job is shipped to Mexico or China, said Steve Schwinn, an associate professor at the John Marshall Law School in Chicago. But that changed in 2009 when the TAA program was opened up to workers in the services industry.

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