HOUSE BILL REPORT

HB 1439

BYRepresentatives Fox, Hargrove, Vekich, Rasmussen and Appelwick

Restricting first source agreements with the employment security department.

House Committe on Trade & Economic Development

Majority Report:  Do pass.  (16)

      Signed by Representatives Vekich, Chair; Wineberry, Vice Chair; Amondson, Beck, Cantwell, Doty, Fox, Grant, Hargrove, Heavey, Holm, Kremen, McLean, Moyer, Rasmussen and B. Williams.

House Staff:Stephen Hodes (786-7092)

AS PASSED HOUSE FEBRUARY 15, 1988

BACKGROUND:

The Legislature created a first-source program in the Employment Security Department in the 1986 session.  The program authorized the Employment Security Department to encourage the use of first-source contracts with employers desiring to locate or expand in the state.  Such agreements involve an agreement by an employer to screen applicants for employment from a pool of qualified individuals submitted to the employer by the Employment Security Department and to consider hiring from that pool.  The Department was authorized to provide financial incentives to employers signing first-source agreements with the Department.  The incentives include providing an employer with up to fifty percent of a trainee's wages during his or her first ten weeks of employment, as well as with on-the-job training.  The legislation permits the employer and perspective employee to agree to a thirty-day training period, at the end of which time the employer shall determine whether to hire the individual.  During the training period, participants may continue to draw unemployment benefits or public assistance, or both.

SUMMARY:

Financial incentives and training provided to employers for participation in the first-source hiring agreement program managed by the Employment Security Department are not to be provided to employers assuming operation of businesses or utilizing the facilities of prior employers while not offering employment to non-management employees of the prior employer, with wages, hours, and working conditions that are similar or substantially equivalent. The restriction does not apply in situations in which the business is substantially different in character from that operated by the prior employer.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    Jeff Johnson, Washington State Labor Council.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    The first source program should not be used to undercut an existing work force.  The use of the program in this way undercuts a useful program.

House Committee - Testimony Against:      None Presented.