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Today is January 24, 2004 |
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January
22, 2004
Lawsuit may bring extended benefits for unemployed tech
workersWashTech News
By Jeff
Nachtigal
Lisa Pineau lost her position as a mainframe
computer programmer when her company outsourced her job to Canada in
October of 2002. Nine months later her Texas state unemployment
benefits ran out, so she applied for certification for eligibility
for extended federal benefits under the Trade Adjustment Assistance
Reform Act (TAA). She was denied.
The federal Trade
Adjustment Assistance program extends unemployment compensation for
up to two years and offers training, job search, and health
insurance coverage assistance to U.S. workers whose jobs have been
outsourced to foreign competition, within specific guidelines.
But the ambiguity of those guidelines has left unemployed IT
workers like Pineau frustrated with their inability to access a
support system that would appear to be set up precisely for them.
With very few exceptions, IT workers have been denied
certification for eligibility for TAA benefits. The U.S. Department
of Labor doesn’t consider the software created by programmers to be
an “article,” or tangible item, within the narrow guidelines of the
Act.
Pineau is one of 16 named plaintiffs in a class action
suit filed January 2, 2004 in the U.S. Court of
International Trade that seeks to make software programmers whose
jobs were outsourced eligible for TAA benefits.
“When they
came up with NAFTA,” said Pineau, 46, who worked for Computer
Horizons in Irving, Tex., for nine years, “they said ‘we’ll train
you for new jobs, help you train for new work,’ but they’re not
doing that. They keep saying we’ll get better jobs, but there aren’t
any, and we can’t afford to get the training.”
This case is
the first of its kind to argue the specific point that software
programmers should be eligible based on the fact that they create a
“tangible commodity.”
“What we’re arguing is that yes,
software is an article,” said lead attorney Michael G. Smith.
“We’re really excited,” Smith said. “This is an issue that
is ripe to be decided in favor of the programmers. If we get the
result we think we should, I think they are terribly
overdue.”
Originally developed about 40 years ago to assist U.S.
manufacturing workers who lost their jobs due to global trade
expansion, the TAA pays benefits
<
http://www.doleta.gov//tradeact/2002act_summary.cfm >
to
workers whose jobs were outsourced to countries that have free trade
agreements with the U.S. In 2002 the Act was amended to cover all
foreign competition – opening the door to software engineers whose
jobs were sent to any foreign country, including India.
The case
The United States Court of International
Trade determines whether workers are eligible for TAA benefits by
establishing whether the firm where the employees work “create or
manufacture a tangible commodity, or transform it into a new and
different article.”
“The reason they were getting turned
down is that the Department of Labor has been saying that these
computer programmers do not produce an article,” said Smith, who
before becoming a patent attorney spent 15 years as a
programmer.
Smith believes the case is a strong one, based
upon multiple rulings called the “new machine doctrine” in the Court
of Appeals for the Federal Circuit. The rulings hold that by
installing new software on a computer, it transforms the computer
into a “new machine.”
By extension, software should be ruled
an article, Smith says.
That point is critical to the case,
because under TAA guidelines unemployed workers are eligible only if
they created an article such as a new machine.
In many cases
the Labor Department has ruled that software is a service, rather
than an article that was produced.
The idea that software is
a service is, “totally bogus,” according to Smith.
Smith
says several software programmer groups have been granted TAA
benefits by the Labor Department, including a group of Nintendo
employees in Washington State. The rulings appear to contradict the
department’s stance, he says, since there is little difference
between a programmer who makes computer games and one that works on
mainframe computers.
Smith said there should be a clear
ruling on the TAA for all IT workers.
Class
members
With the number of U.S. workers involved in creating
software, Smith says he believes the number of class members could
easily reach into the thousands.
Eligible class members
include software coders who lost their jobs to foreign countries.
The class also includes programmer support staff, database and
network administrators, secretaries, and even janitors.
A
favorable ruling would give a much needed-assist to IT workers
hard-hit by outsourcing. It could also mean substantial retroactive
payment of benefits to class members. The class does not, include
managers or tech support personnel, such as a telephone tech support
personnel. It also doesn’t include workers whose work was
transferred to a worker in the U.S on a H-1B visa or a L-1 visa.
Smith estimated that one unemployed software programmer in
California
who
was eligible for all the benefits – including unemployment
compensation ($52,000), retraining benefits ($10,000), job search
expenses and relocation expenses ($1,250 for each), and the 65
percent tax credit for health care expenses – could be due an amount
of more than $40,000 under the TAA.
Judge Richard W. Goldberg
of the U.S. Court of International Trade is slated to preside over
the case. An initial ruling is expected by June, but Smith expects
this case to extend through an appeals process in the Court of
Appeals for the Federal Circuit, and perhaps even to the U.S.
Supreme Court before a final decision is made.
Class action
plaintiff Jim Fusco of East Brunswick, N.J. worked for AT&T for
13 years before his job was outsourced to IBM. Fusco, now 50,
transferred to IBM, but now IBM is outsourcing his job to India.
He was turned down for TAA benefits, but returned to school
anyway for Web development training. Recently he found another job.
“The work I’m doing is not really related to what I did at
IBM,” Fusco says. “But I feel fortunate to have it, or I would still
be living off my savings. My motivation is to make a point that tech
workers are entitled to same protections as any other
workers.”
Jack Lake, 58, hasn’t been able to find a job since
Computer Horizons outsourced his job. His unemployment compensation
has run out, and he says he will have to live on his savings or his
401k plan.
“I’d love to take Web design and Java
programming, but that’s expensive,” said Lake, who has 33 years of
programming experience. “I need my money to pay my taxes. I know
that if you can get on your resume anything with Internet, you have
a lot better shot at a job.”
In Irving, Texas, the job market
for computer programmers is so bad that 18-year veteran programmer
Pineau and her husband are considering getting out of high-tech for
good and buying a fast food franchise.
“It would be nice if
we got money,” Pineau said, “but that’s not really why I’m doing
this. It’s more the principle of the thing, and to really get
publicity towards the whole offshoring issue.”
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