The labor and employment law changes from the Obama Administration are coming so quickly, we are introducing The Transition Report, a quick update on the changes. On many of these topics, we will follow up with more in-depth coverage.


Today, in a ceremony at the Denver Museum of Nature and Science, President Barack Obama signed into law his $789 billion stimulus package, properly named the American Recovery and Reinvestment Act of 2009. President Obama chose the venue to highlight the "green" jobs that he says will be created by his program. Several provisions in this massive program will affect employees and employers. The following is a summary of the employment-related provisions.

COBRA subsidies and other changes. The stimulus appropriates $20 billion toward a 65 percent subsidy of COBRA premiums. Constangy is issuing an in-depth client bulletin today on the COBRA changes.

Extension of unemployment benefits. Legislation that extended the period for receiving unemployment benefits by seven weeks (to a total of 33 weeks) was due to expire March 31, 2009. The stimulus package delays the expiration until December 31, 2009. In addition, unemployed workers will be entitled to $25 more per week in benefits, and the first $2,400 of unemployment benefits will be exempt from federal income tax.

TAA expansion. Trade Adjustment Assistance, consisting primarily of extended eligibility for unemployment compensation and educational assistance, was previously available to workers who had lost manufacturing jobs due to those jobs' being moved offshore to countries with which the United States had signed free trade agreements. Now, TAA will be available to workers in the service sector, as well, and will be available any time the eligible jobs move offshore, regardless of whether the country had a free trade agreement with the United States.

No E-Verify, and other immigration issues. Any references to E-Verify have been removed from the final version of the stimulus bill. Businesses that receive government funds under the Troubled Asset Relief Program, which gives the Secretary of the Treasury the authority to purchase "troubled assets," such as mortgages or financial instruments, must either hire laid-off U.S. workers or show good cause as to why they cannot before they may recruit or hire workers under the H-1B program.

Executive compensation for TARP employers. TARP employers will be limited as to how much compensation they can offer their top executives. The stimulus package has a sliding scale based on the amount of TARP funds received by the employer. 

This is a publication of Constangy, Brooks & Smith, LLP. The information contained in this newsletter is not intended to be, nor does it constitute, legal advice. The hiring of a lawyer is an important decision that should not be based solely upon advertisements. Before you decide, ask us to send you free written information about our qualifications and experience. No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers.

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