Shipley, Akerman, & Pickett, letter to the chairman. 442 South Carolina Employment Security Commission, letter of B. F. Godfrey, 650 735 Southern California Edison Co., letter of Fred Oldendorf, Jr., vice presi- 707 Southern States Industrial Council, statement of Tyre Taylor, general 734 St. Louis Labor Council, AFL-CIO, letter of Joseph P. Clark, president, to 750 Transport Workers' Union of America, letter of Matthew Guinan, interna- 724 United Association of Journeymen & Apprentices of the Plumbing & Pipe- 744 United Rubber, Cork, Linoleum & Plastic Workers of America, letter of George Burdon, international president, to the chairman_. United Slate, Tile & Composition Roofers, Damp & Waterproof Workers' Association, letter of Charles D. Aquadro, international president, to the United Steelworkers of America: Letter of I. W. Abel, president, to the chairman___ 581 Letter of Frank N. Hoffmann, legislative director to the chairman___ 204 205 746 United Transport Service Employees, letter of George P. Sabattie, presi- 587 Washington State Labor Council, AFL-CIO, letter and enclosure of Marvin 744 Whirlpool Corp., statement submitted by A. J. Takacs, manager, legislative 820 Wyoming State AFL-CIO, letter and enclosure of John D. Holaday, exec- 746 ADDITIONAL INFORMATION "Amendments Recommended by the Labor Department to H.R. 15119," 61 "No Federal Standards-Senate Only Hope After House Kills Jobless Pay 806 "Unemployment Insurance and the War on Poverty," article from the Un- 434 UNEMPLOYMENT INSURANCE AMENDMENTS OF 1966 WEDNESDAY, JULY 13, 1966 U.S. SENATE, COMMITTEE ON FINANCE, Washington, D.C. The committee met, pursuant to notice, at 10 a.m., in room 2221, New Senate Office Building, Senator Russell B. Long (chairman) presiding. Present: Senators Long, Douglas, Gore, McCarthy, Hartke, Metcalf, Williams, Curtis, Morton, and Dirksen. Also present: Tom Vail, chief counsel. The CHAIRMAN. This hearing will come to order. H.R. 15119, the bill before the committee, represents the broadest revision of the Federal-State unemployment compensation program Congress has undertaken since the system was inaugurated in 1935. Revision and upgrading of this jointly administered program is an important part of the President's legislative program for the 89th Congress. The current rate of insured unemployment, that is those who are covered by the unemployment compensation benefit program, is 1.8 percent. This is the lowest rate for insured unemployment since 1946. The overall unemployment rate for the month of June was 4 percent. 1966 is the first year since 1957 that employment has been at so low a rate. With this fine showing, now is a particularly good time to review the whole program so we can have unemployment compensation benefits readily available in adequate amounts to combat a future recession if there should be one. This will make it less likely that we will be faced with enacting haphazard, emergency measures, as we had to do in 1958 and again in 1961. This hearing will continue through Tuesday, July 26. More than 50 witnesses are scheduled to present oral testimony, and scores more have indicated that they would file statements in lieu of a personal statement. 1 (Text of H.R. 15119 follows:) [H.R. 15119, 89th Cong., 2d sess.] AN ACT To extend and improve the Federal-State unemployment compensation program Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "Unemployment Insurance Amendments of 1966". TITLE I-IN GENERAL PART A-COVERAGE DEFINITION OF EMPLOYER SEC. 101. (a) Subsection (a) of section 3306 of the Internal Revenue Code of 1954 is amended to read as follows: "(a) EMPLOYER.-For the purposes of this chapter, the term 'employer' means, with respect to any calendar year, any person who "(1) during any calendar quarter in the calendar year paid wages of $1,500 or more, or "(2) on each of some 20 days during the calendar year, each day being in a different calendar week, employed at least one individual in employment for some portion of the day." (b) The amendment made by subsection (a) shall apply with respect to remuneration paid after December 31, 1968. DEFINITION OF EMPLOYEE SEC. 102. (a) Subsection (i) of section 3306 of the Internal Revenue Code of 1954 is amended to read as follows: "(1) EMPLOYEE.-For purposes of this chapter, the term 'employee' has the meaning assigned to such term by section 3121(d), except that subparagraphs (B) and (C) of paragraph (3) shall not apply." (b) Section 1563 (f) (1) of such Code (relating to surtax exemption in case of certain controlled corporations) is amended by striking out "in section 3306(i)” and inserting in lieu thereof "by paragraphs (1) and (2) of section 3121 (d)". (c) The amendment made by subsection (a) shall apply with respect to renumeration paid after December 31, 1968, for services performed after such date. DEFINITION OF AGRICULTURAL LABOR SEC. 103. (a) Subection (k) of section 3306 of the Internal Revenue Code of 1954 is amended to read as follows: "(k) AGRICULTURAL LABOR. For purposes of this chapter, the term 'agricultural labor' has the meaning assigned to such term by subsection (g) of section 3121, except that for purposes of this chapter subparagraph (B) of paragraph (4) of such subsection (g) shall be treated as reading: "(B) in the employ of a group of operators of farms (or a cooperative organization of which such operators are members) in the performance of service described in subparagraph (A), but only is such operators produced more than one-half of the commodity with respect to which such service is performed;'". (b) The amendment made by subsection (a) shall apply with respect to remuneration paid after December 31, 1968, for services performed after such date. STATE LAW COVERAGE OF CERTAIN EMPLOYEES OF NONPROFIT ORGANIZATIONS AND OF STATE HOSPITALS AND INSTITUTIONS OF HIGHER EDUCATION SEC. 104. (a) Section 3304(a) of the Internal Revenue Code of 1954 is amended by redesignating paragraph (6) as paragraph (12) and by inserting after paragraph (5) the following new paragraph: "(6) (A) compensation is payable on the basis of service to which section 3310 (a) (1) applies, in the same amount, on the same terms, and subject to the same conditions as compensation payable on the basis of other service subject to such law, and "(B) payments (in lieu of contributions) with respect to service to which section 3310 (a)(1)(A) applies may be made into the State unemployment fund on the basis set forth in section 3310(a) (2);" (b) (1) Chapter 23 of the Internal Revenue Code of 1954 is amended by adding at the end thereof the following new section: "SEC. 3310. STATE LAW COVERAGE OF CERTAIN SERVICE PERFORMED FOR NONPROFIT ORGANIZATIONS AND FOR STATE HOSPITALS AND INSTITUTIONS OF HIGHER EDUCATION. "(a) STATE LAW REQUIREMENTS.-For purposes of section 3304 (a) (6)— "(1) except as otherwise provided in subsections (b) and (c), the service to which this paragraph applies is "(A) service excluded from the term 'employment' solely by reason of paragraph (8) of section 3306 (c), and "(B) service performed in the employ of a State, or any instrumentality of one or more States, for a hospital or institution of higher education, if such service is excluded from the term 'employment' solely by reason of paragraph (7) of section 3306 (c); and "(2) the State law 'shall provide that an organization or group of organizations) which, but for the requirements of this paragraph, would be liable for contributions with respect to service to which paragraph (1)(A) applies may elect, for such minimum period and at such time as may be provided by State law, to pay (in lieu of such contributions) into the State unemployment fund amounts equal to the amounts of compensation attributable under the State law to such service. The State law may provide safeguards to ensure that organizations so electing will make the payments required under such elections. "(b) SECTION NOT TO APPLY TO CERTAIN SERVICE. This section shall not apply to service performed— "(1) in the employ of (A) a church or convention or association of churches, or (B) an organization which is operated primarily for religious purposes and which is operated, supervised, controlled, or principally supported by a church or convention or association of churches; "(2) by a duly ordained, commissioned, or licensed minister of a church in the exercise of his ministry or by a member of a religious order in the exercise of duties required by such order; "(3) in the employ of an educational institution which is not an institution of higher education; "(4) in the case of an institution of higher education, by an individual employed in an instructional, research, or principal administrative capacity; (5) in the case of a hospital (or in the case of a medical research organization directly engaged in the continuous active conduct of medical research in conjuntion with a hospital), by an individual as a physician, dentist, osteopath, chiropractor, naturopath, or Christian Science practioner, or by an individual employed in an instructional or research capacity; "(6) in a facility conducted for the purpose of carrying out a program of "(A) rehabilitation for individuals whose earning capacity is impaired by age or physical or mental deficiency or injury; or "(B) providing remunerative work for individuals who because of their impaired physical or mental capacity cannot be readily absorbed in the competitive labor market, by an individual receiving such rehabilitation or remunerative work; and "(7) as part of an unemployment work-relief or work-training program assisted or financed in whole or in part by any Federal agency or an agency of a State or political subdivision thereof, by an individual receiving such work relief or work training. "(c) NONPROFITS MUST BE EMPLOYERS OF 4 OR MORE.-This section shall not apply to service performed during any calendar year in the employ of any organization unless on each of some 20 days during such calendar year, each day being in a different calendar week, the total number of individuals who were employed by such organization in employment (determined without regard to section 3306 (c) (8) and by excluding service to which this section does not apply by reason of subsection (b)) for some portion of the day (whether or not at the same moment of time) was 4 or more." |