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90_HB0612
New Act
30 ILCS 105/5.449 new
820 ILCS 405/1506.3 from Ch. 48, par. 576.3
Creates the Employment Training Act. Creates an
Employment Training Panel in the Department of Commerce and
Community Affairs. Creates an Employment Training Fund in
the State Treasury (and amends the State Finance Act to
include that Fund as a special fund). Amends the
Unemployment Insurance Act to impose an extra 0.1% on
employer contributions, with the extra amount to be deposited
into the Fund. Provides that the Panel shall: prepare an
annual plan and an annual report; enter into contracts for
the provision of employment training; allocate the Fund;
evaluate projects; coordinate job training programs; and
perform other duties.
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1 AN ACT in relation to employment training, amending named
2 Acts.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 1. Short title. This Act may be cited as the
6 Employment Training Act.
7 Section 5. Legislative findings, intent, and purposes.
8 (a) The General Assembly finds as follows:
9 (1) There is an inadequate number of jobs in
10 Illinois to meet the needs of those seeking employment.
11 (2) Despite the large number of unemployed job
12 seekers, many employers in new and expanding industries
13 are having difficulty matching the skills they require
14 with the skills of workers. A similar problem exists in
15 industries where overall employment may not be expanding
16 but where there is an acute need for skilled workers in
17 particular occupations.
18 (3) The Illinois economy is today being challenged
19 by competition from other states and overseas. Our
20 success in meeting that challenge will depend largely on
21 our ability to maintain and improve a skilled and
22 productive work force. Employers, workers, organized
23 labor, and government need to work together to ensure
24 that the Illinois labor force is prepared to succeed in
25 the economic environment of the 1990's.
26 (4) Under existing law, all employer taxes paid
27 into the unemployment insurance system compensate
28 unemployment insurance recipients for being out of work.
29 The intent of this Act is to use a small portion of
30 employer taxes to put unemployment insurance recipients
31 to work by encouraging employers to locate and expand
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1 facilities in this State and training unemployment
2 insurance recipients in skills needed by employers and to
3 prevent unemployment by increasing productivity through
4 the retraining of existing employees.
5 (b) The purposes of this Act are as follows:
6 (1) To establish an employment training program
7 which shall foster job creation, minimize employers'
8 unemployment costs, and meet employers' needs for skilled
9 workers by providing skills training to unemployment
10 insurance claimants, recent exhaustees of unemployment
11 insurance who have remained unemployed, and potentially
12 displaced workers who would otherwise become unemployment
13 insurance claimants.
14 (2) To encourage investment in the productivity and
15 competitiveness of the State's workers through training.
16 (3) To encourage the State to adapt its priorities
17 to the changing needs of the labor market through the use
18 of labor market data and information.
19 (4) To enhance the State's ability to serve those
20 who are unemployed.
21 (5) To provide additional employment to the State's
22 unemployed.
23 (6) To increase the amount of coordination between
24 this program and other programs involved in education and
25 training.
26 (7) To improve the effectiveness of State training
27 programs as a mechanism for stimulating economic
28 development.
29 (c) It is the intent of the General Assembly that
30 training funded pursuant to this Act should make a
31 substantial contribution to the long-term job security of the
32 trainees and that all training funded through this Act should
33 result in jobs for those who successfully complete the
34 training.
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1 (d) The funds made available by this Act shall
2 supplement but not displace funds available through existing
3 programs conducted by employers themselves and public
4 programs such as the Job Training Partnership Act, the Carl
5 D. Perkins Vocational Education Act, the Prairie State 2000
6 Authority Act, the Industrial Training Program, the Illinois
7 Enterprise Zone Act, or the apportionment of those funds
8 allocated to local educational agencies. In addition, it is
9 the intention of the General Assembly that programs developed
10 pursuant to this Act shall not replace, parallel, supplant,
11 compete with, or duplicate in any way already existing
12 apprenticeship programs approved by the U.S. Department of
13 Labor Bureau of Apprenticeship Training. However, these
14 funds may be used to train persons entering an
15 apprenticeships program approved by the Bureau of
16 Apprenticeship Training after having completed a school-based
17 youth apprenticeship program.
18 (e) The program established through this Act is to be
19 coordinated with all existing employment training programs
20 and economic development programs, including, but not limited
21 to, programs such as the Job Training Partnership Act, the
22 Prairie State 2000 Authority Act, the regional occupational
23 programs, vocational education programs, joint
24 labor-management training programs, and the Industrial
25 Training Program and related programs under the Department of
26 Commerce and Community Affairs.
27 Section 10. Definitions. As used in this Act:
28 (a) "Employer" means (i) any employer as defined in the
29 Unemployment Insurance Act, except any public entity, or (ii)
30 any nonprofit organization which has elected an alternate
31 method of financing its liability for unemployment insurance
32 benefits pursuant to that Act.
33 Any public entity or nonprofit organization which has
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1 elected an alternate method of financing its liability for
2 unemployment insurance benefits pursuant to the Unemployment
3 Insurance Act shall be deemed to be an employer only for
4 purposes of placement of new hire trainees who received
5 training as an incidental part of a training project designed
6 to meet the needs of one or more private sector employers.
7 (b) "Eligible participant" means any person who, prior
8 to beginning training or employment pursuant to this Act, is
9 any of the following:
10 (1) Unemployed and has established an unemployment
11 insurance claim or has exhausted eligibility for
12 unemployment insurance benefits.
13 (2) Employed, but is determined by the Panel to be
14 likely to be displaced and therefore claiming
15 unemployment insurance benefits because of reductions in
16 overall employment within a business, elimination of the
17 person's current job, or a substantial change in the
18 skills required to remain employed due to technological
19 change or other factors.
20 (3) Employed, but who is determined by the Panel to
21 be qualified to be trained or retrained in skills for
22 which there is a demonstrable shortage and in a field
23 where new employment opportunities will be created for
24 other persons defined in subdivision (1) if this
25 retraining takes place.
26 (c) "Panel" means the Employment Training Panel created
27 by Section 15.
28 (d) "Fund" means the Employment Training Fund created by
29 Section 25.
30 (e) "Training agency" means any private training entity
31 or local educational agency.
32 (f) "Job" means employment on a basis customarily
33 considered full time for the occupation and industry. The
34 employment shall have definite career potential and a
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1 substantial likelihood of providing long-term job security.
2 Furthermore, the employment shall provide earnings, upon
3 completion of the employment requirement, equal to 55%, in
4 the case of new hire training, or 65%, in the case of
5 retraining, of the State average hourly wage. However, the
6 Panel may adjust these minimum wage requirements for specific
7 occupations in specific regions of the State if it
8 determines, after a review of labor market information, that
9 the wage requirements are unreasonable, and if the adjusted
10 wage requirement does not create unfair wage competition
11 within the industry or region.
12 (g) "Labor organization" means (i) organizations or
13 federations of workers established to bargain collectively on
14 behalf of their workers or (ii) federations of labor
15 organizations.
16 (h) "New hire training" means employment training,
17 including job-related literacy training, for persons who, at
18 the start of training, are unemployed.
19 (i) "Retraining" means employment related skill and
20 literacy training for persons who are employed prior to
21 enrollment in training and will continue to be employed by
22 the same employer for at least 90 days following completion
23 of training.
24 (j) "Trainee" means an eligible participant.
25 (k) "State average hourly wage" means a average weekly
26 wage paid by employers to employees covered by unemployment
27 insurance, as reported by the Department of Employment
28 Security, for the 4 calendar quarters ending June 30 of the
29 preceding calendar year, divided by 40 hours.
30 Section 15. Employment Training Panel.
31 (a) There is hereby established in the Department of
32 Commerce and Community Affairs the Employment Training Panel
33 consisting of 5 persons with experience and a demonstrated
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1 interest in business management and employment relations.
2 (b) The Panel shall consist of 2 members from organized
3 labor nominated by a statewide labor organization
4 representing a wide range of occupations, 2 members from
5 business or industry nominated by statewide business
6 organizations representing a wide range of occupations, and
7 one public member appointed by the Governor.
8 (c) Members of the Panel shall serve without
9 compensation, but shall be reimbursed for the necessary
10 traveling and other expenses incurred by them in the
11 performance of their official duties out of appropriations
12 made for the support of the panel.
13 Section 20. Coordination of programs. The Panel shall
14 coordinate its programs with local and State entities of the
15 federal Job Training Partnership Act. This coordination
16 shall include, but not be limited to, the adoption of a plan,
17 including regular sharing of data, for the coordination of
18 training authorized pursuant to this Act with other programs.
19 Section 25. Employment Training Fund. The Employment
20 Training Fund is created as a special fund in the State
21 Treasury. The Panel may allocate moneys in the Fund, subject
22 to appropriation, for any of the following purposes:
23 (i) Reimbursement of reasonable training costs and
24 administrative costs incurred by the contractor not to
25 exceed 15% for State training agencies and not to exceed
26 10% for business and labor organizations.
27 (ii) Costs of program administration incurred under
28 this Act. The Panel's administrative costs may not
29 exceed 15% of the moneys deposited into the Fund.
30 Allocation of moneys in the Fund by the Panel is also
31 subject to subsection (d) of Section 30.
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1 Section 30. Duties of the Panel. The Panel shall do all
2 of the following:
3 (a) Establish and update an annual plan, based on the
4 demand of employers for trained workers, changes in the
5 State's economy and labor markets, and continuous reviews of
6 the effectiveness of Panel training contracts. The plan
7 shall be submitted to the Governor and the General Assembly.
8 In carrying out this Section, the Panel shall review
9 information in the following areas:
10 (1) Labor market information, including the
11 State-local labor market information program in the
12 Department of Employment Security, and economic
13 forecasts.
14 (2) Evaluations of the effectiveness of training as
15 measured by increased security of employment for workers
16 and benefits to the Illinois economy.
17 (3) The demand for training by industry, type of
18 training, and size of employer.
19 (4) Changes in skills necessary to perform jobs,
20 including changes in basic literacy skills.
21 (5) Evaluations of the effectiveness of training
22 previously funded by the Panel in improving security of
23 employment for workers and benefiting the Illinois
24 economy. As part of these evaluations, the Panel shall
25 compare the wages of trainees in the year before and in
26 the year after training as reflected in the Department's
27 unemployment insurance tax records, and shall evaluate
28 the effect of previous training projects on the
29 productivity of participating firms and on the economy of
30 the State.
31 (6) Changes in the demographics of the labor force
32 and the population entering the labor market.
33 (7) Proposed expenditures by other agencies of
34 federal Job Training Partnership Act funds and other
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1 State and federal training and vocational education funds
2 on eligible participants.
3 (b) Submit its first annual plan by January 1, 1999.
4 The Panel shall maintain a system to continuously monitor
5 economic and other data required under this plan. If this
6 data changes significantly during the life of the plan, the
7 plan shall be amended by the Panel. Each plan shall include
8 all of the following:
9 (1) The Panel's objectives with respect to the
10 distribution of funds between new hire training and
11 retraining.
12 (2) The identification of specific industries,
13 production and quality control techniques, and regions of
14 the State where employment training funds would most
15 benefit the State's economy and plans to encourage
16 training in these areas, including specific standards and
17 a system for expedited review of proposals which meet the
18 standards.
19 (3) A system for expedited review of proposals
20 which are substantially similar with respect to employer
21 needs, training curriculum, duration of training, and
22 costs of training, in order to encourage the development
23 of proposals which meet the needs identified in
24 subdivision (2).
25 (4) The Panel's goals and operational objectives
26 with respect to meeting the needs of small employers.
27 (5) A priority list of skills that are in such
28 short supply that employers are choosing to not locate or
29 expand their businesses in the State or are importing
30 labor in response to these skills shortages. This list
31 shall identify those industries in which upgrade training
32 is likely to encourage hiring of the unemployed on a
33 backfill basis.
34 (c) Solicit proposals and enter into contracts on the
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1 basis of proposals made directly to it. Contracts for the
2 purpose of providing employment training may be entered into
3 with any of the following:
4 (1) An employer or group of employers.
5 (2) A labor organization or group of labor
6 organizations.
7 (3) A private industry council with the approval of
8 the appropriate local elected officials in the service
9 delivery area.
10 (4) A grant recipient or administrative entity
11 selected pursuant to Section 103 of the federal Job
12 Training Partnership Act and with the approval of the
13 local private industry council and the appropriate local
14 elected officials.
15 These contracts shall be in the form of fixed-fee
16 performance contracts. Notwithstanding any provision of law
17 to the contrary, contracts entered into pursuant to this Act
18 shall not be subject to competitive bidding procedures. No
19 trainee shall receive employment training under this Act for
20 a period of not more than 18 months. Contracts for training
21 may be written for a period not to exceed 24 months for the
22 purpose of administration by the Panel and the contracting
23 employer or any group of employers acting jointly, any labor
24 organization or group of labor organizations acting jointly,
25 or any training agency for the purpose of providing
26 employment training.
27 (d) Allocate the Employment Training Fund, subject to
28 appropriation. In doing so, the Panel shall seek to
29 facilitate the employment of the maximum number of eligible
30 participants in jobs with definite career potential and
31 long-term job security, and to provide retraining to existing
32 workers whose skills are outmoded due to changes in
33 technology or the need to increase productivity. In funding
34 contracts, the Panel shall give priority to the following,
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1 except that within each priority category, proposals jointly
2 developed by business management and worker representatives
3 shall be given special consideration:
4 (1) New hire training and retraining for workers
5 who have received notification of actual layoff.
6 (2) Retraining of eligible participants employed at
7 the site of training by small businesses.
8 (3) Retraining for workers whose jobs are
9 threatened by increased competition from outside the
10 State.
11 Nothing in this Act shall be construed to require the
12 Panel to set aside funds based on the priorities established
13 in this subdivision, or to preclude the Panel from entering
14 into contracts for the provision of training in
15 multijurisdictional areas of the State. In making
16 determinations under this Section, the Panel shall give
17 special consideration to proposals for training for new
18 employees of firms locating or expanding in Illinois, and to
19 new hire and retraining for firms located in enterprise zones
20 and economic incentive areas designated by the Department of
21 Commerce and Community Affairs. The Panel shall provide
22 technical assistance to encourage the development of these
23 proposals.
24 (e) Establish minimum standards for the consideration of
25 proposals, which shall include, but not be limited to, the
26 identification of employers who have been contacted by the
27 contractor and who have provided reasonable assurance that
28 they will employ successful trainees, the number of jobs
29 available, the skill requirements for the identified jobs,
30 the projected cost per person trained, hired, and retrained
31 in employment, the wages paid successful trainees upon
32 placement, and the curriculum for the training. No proposal
33 shall be considered or approved which proposes training for
34 employment covered by a collected bargaining agreement unless
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1 the signatory labor organization agrees in writing.
2 (f) Provide for evaluation of projects funded by this
3 Act. Individual project evaluations shall contain a summary
4 description of the project, the number of persons entering
5 training, the number of persons completing training, the
6 number of persons employed at the end of the project, the
7 number of persons still employed 3 months after the end of
8 the project, the wages paid, the total costs of the project,
9 and the total reimbursement received from the Employment
10 Training Fund.
11 (g) Report to the Governor and the General Assembly by
12 November 30 of each year on projects operating during the
13 previous State fiscal year. These annual reports shall
14 include summaries of:
15 (1) Projects completed during the year, including
16 their individual and aggregate performance and cost.
17 (2) A description of the amount, type, and
18 effectiveness of literacy training funded by the Panel.
19 In addition, based upon its experience in administering
20 job training projects, the Panel shall include in these
21 reports policy recommendations concerning the impact of job
22 training and the Panel's program on economic development,
23 labor-management relations, employment security, and other
24 related issues.
25 (h) Expedite the processing of contracts for firms
26 considering locating or expanding businesses in the State, as
27 determined by the Department of Commerce and Community
28 Affairs.
29 (i) Coordinate and consult regularly with business
30 groups and labor organizations, the State Job Training
31 Coordinating Council, the State Board of Education, the
32 Department of Employment Security, and the Department of
33 Commerce and Community Affairs.
34 (j) Adopt rules for procedures for the conduct of Panel
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1 business, including the scheduling and conduct of meetings,
2 the review of proposals, the awarding of contracts, the
3 administration of contracts, and the payment of amounts due
4 to contractors. All decisions by the Panel shall be made by
5 resolution of the Panel and any adverse decision shall
6 include a statement of the reason for the decision.
7 Section 900. The State Finance Act is amended by adding
8 Section 5.449 as follows:
9 (30 ILCS 105/5.449 new)
10 Sec. 5.449. The Employment Training Fund.
11 Section 905. The Unemployment Insurance Act is amended
12 by changing Section 1506.3 as follows:
13 (820 ILCS 405/1506.3) (from Ch. 48, par. 576.3)
14 Sec. 1506.3. Fund building rates - Temporary
15 Administrative Funding.
16 A. Notwithstanding any other provision of this Act, the
17 following fund building rates shall be in effect for the
18 following calendar years:
19 For each employer whose contribution rate for 1988, 1989,
20 1990, the first, third, and fourth quarters of 1991, 1992,
21 1993, 1994, 1995, and 1997 and any calendar year thereafter
22 would, in the absence of this Section, be 0.2% or higher, a
23 contribution rate which is the sum of such rate and 0.4%;
24 For each employer whose contribution rate for the second
25 quarter of 1991 would, in the absence of this Section, be
26 0.2% or higher, a contribution rate which is the sum of such
27 rate and 0.3%;
28 For each employer whose contribution rate for 1996 would,
29 in the absence of this Section, be 0.1% or higher, a
30 contribution rate which is the sum of such rate and 0.4%;
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1 Notwithstanding the preceding paragraphs of this Section
2 or any other provision of this Act, except for the provisions
3 contained in Section 1500 pertaining to rates applicable to
4 employers classified under the Standard Industrial Code, no
5 employer whose total wages for insured work paid by him
6 during any calendar quarter in 1988 and any calendar year
7 thereafter are less than $50,000 shall pay contributions at a
8 rate with respect to such quarter which exceeds the
9 following: with respect to calendar year 1988, 5%; with
10 respect to 1989 and any calendar year thereafter, 5.4%.
11 Notwithstanding the preceding paragraph of this Section,
12 or any other provision of this Act, no employer's
13 contribution rate with respect to calendar years 1993 through
14 1995 shall exceed 5.4% if the employer ceased operations at
15 an Illinois manufacturing facility in 1991 and remained
16 closed at that facility during all of 1992, and the employer
17 in 1993 commits to invest at least $5,000,000 for the purpose
18 of resuming operations at that facility, and the employer
19 rehires during 1993 at least 250 of the individuals employed
20 by it at that facility during the one year period prior to
21 the cessation of its operations, provided that, within 30
22 days after the effective date of this amendatory Act of 1993,
23 the employer makes application to the Department to have the
24 provisions of this paragraph apply to it. The immediately
25 preceding sentence shall be null and void with respect to an
26 employer which by December 31, 1993 has not satisfied the
27 rehiring requirement specified by this paragraph or which by
28 December 31, 1994 has not made the investment specified by
29 this paragraph.
30 B. Notwithstanding any other provision of this Act, for
31 the second quarter of 1991, the contribution rate of each
32 employer as determined in accordance with Sections 1500,
33 1506.1, and subsection A of this Section shall be equal to
34 the sum of such rate and 0.1%; provided that this subsection
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1 shall not apply to any employer whose rate computed under
2 Section 1506.1 for such quarter is between 5.1% and 5.3%,
3 inclusive, and who qualifies for the 5.4% rate ceiling
4 imposed by the last paragraph of subsection A for such
5 quarter. All payments made pursuant to this subsection shall
6 be deposited in the Employment Security Administrative Fund
7 established under Section 2103.1 and used for the
8 administration of this Act.
9 C. Payments received by the Director which are
10 insufficient to pay the total contributions due under the Act
11 shall be first applied to satisfy the amount due pursuant to
12 subsection B.
13 D. All provisions of this Act applicable to the
14 collection or refund of any contribution due under this Act
15 shall be applicable to the collection or refund of amounts
16 due pursuant to subsection B.
17 E. Notwithstanding any other provision of this Act, for
18 calendar years beginning on January 1, 1998, the contribution
19 rate of each employer as determined in accordance with
20 Sections 1500 and 1506.1 and subsection A of this Section
21 shall be equal to the sum of such rate and 0.1%. All payments
22 shall be deposited in the Employment Security Administrative
23 Fund except for the extra 0.1% collected in accordance with
24 this subsection E, which shall be deposited in the Employment
25 Training Fund.
26 (Source: P.A. 88-518; 89-446, eff. 2-8-96.)