Highlights of President Obama's Budget Request for the Department of Labor

Published March 12th, 2014 -  - 03.12.1415


Last week, President Obama released his budget request for fiscal year 2015, which included a proposed $200 million increase in funding for the Department of Labor, for a total of $11.8 billion. According to the Department, the request “targets investments to improve job training and employment programs; strengthens enforcement of laws that protect workers’ wages and working conditions; provides a strong safety net for workers who lose their jobs or are hurt on the job; and promotes a secure retirement for workers at the end of their careers.”

Specifically, the Administration outlines a broad Opportunity, Growth, and Security Initiative which “envisions a significant role for the Department [of Labor],” including:

    • $1.5 billion in 2015 to support a four-year, $6 billion Community College Job-Driven Training Fund, which will offer competitive grants to partnerships of community colleges, public and non-profit training entities, industry groups, and employers to launch new training programs and apprenticeships that will prepare participants for in-demand jobs and careers. Of each year’s funding, $500 million will be set aside for grants to create new apprenticeships and increase participation in existing apprenticeship programs. This four-year investment will support doubling the number of apprenticeships in America over the next five years.
    • An additional $750 million to restore prior cuts in job training and employment services, invest more intensively in innovation, and target resources to populations that face significant barriers to employment.
    • $100 million to support more States in establishing and launching paid leave programs for their workforce.

A substantial portion of the Labor Department’s budget consists of large grant programs designed to help “low-income youth” and “those who have experienced long-term unemployment” find and maintain jobs, including:

    • $2 billion in mandatory funding to encourage States to adopt Bridge to Work programs that will allow individuals to continue receiving their weekly [unemployment insurance] check while participating in a short-term work placement and support other strategies for getting [unemployment insurance] claimants back to work more quickly;
    • $4 billion in mandatory funding, to be obligated over two years, to support partnerships between businesses, education, and training providers to train approximately 1 million long-term unemployed workers for new jobs; and
    • $2.5 billion for Summer Jobs Plus, which will fund summer and year-round job opportunities for 600,000 youth as well as innovation grants aimed at improving skills and career options for disadvantaged youth.

On a related note, the Department emphasized in their budget materials that it “supports the extension of emergency unemployment benefits for the long- term unemployed” by Congress, as “3.6 million additional people are estimated to lose access to extended [unemployment insurance] benefits by the end of 2014, despite remaining unemployed and looking for work.”

The budget request also increases enforcement funding for the Wage and Hour Division by $40 million, which will “enable the division to hire 300 new investigators across the U.S . . . targeting employers and industries ‘most likely to break the law.’” Additionally, the budget request highlights efforts to “focus on workers [the Wage and Hour Divison] believes have been misclassified as independent contractors, a practice that administration officials, unions, and other left-leaning groups say is used too often to deprive workers of protections such as overtime pay and unemployment insurance.”  To that end, the request “includes $10 million in continued grants to States to recover unpaid unemployment taxes and an increase of $3.8 million for [Wage and Hour] personnel to investigate violations.” According to the Wall Street Journal, this is “a hot-button issue for unions and employers in part because unions aren’t allowed to organize independent contractors.”

Moreover, the budget request also includes several small but significant increases to targeted or preliminary programs. For example, the request “would provide $4 million more for the Occupational Safety and Health Administration’s enforcement of 21 whistleblower laws designed to protect workers and others from retaliation for reporting unsafe workplace conditions.” Additionally, the request “includes a $5 million State Paid Leave Fund to provide technical assistance and support to States that are considering paid leave programs,” and proposes “an additional $1.1 million to strengthen enforcement efforts of the Office of Federal Contract Compliance Programs (OFCCP), which works to eliminate pay discrimination and secure equal treatment for all workers.”

Several unions, such as the Teamsters and the AFL-CIO, “applaud[ed] the president” for his “proposals to invest in jobs, raise the minimum wage, expand the [Earned Income Tax Credit], close tax loopholes for the wealthy and provide access to universal pre-kindergarten.” Unsurprisingly, however, “[t]he [Labor] budget drew quick criticism from Rep. John Kline (R., Minn.), chairman of the House Education and the Workforce Committee, who argued that the request comprised “more of the same” and criticized President Obama for proposing a budget that would “make an existing maze of programs even more costly and confusing.”

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