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Boeing Makes Headlines for Generous Unemployment Benefits Package

Published on 5/12/2015 12:00:00 AM
unemployment benefits package

Have you heard the expression, “Go big or go home”? If you’re an employee of Seattle-based Boeing Commercial Airlines, you get to do both if you’re laid off, thanks to one of the most generous unemployment programs ever reported. Workers who are laid off between April 2012 and June 2015 receive an unemployment compensation package that includes a staggering 130 weeks of unemployment pay.

What does it mean for other employers?

While Boeing’s unemployment benefits are certainly news-worthy, what does it mean for other employers and their unemployed workers? For the most part, very little.

The result of union pressure on the U.S. Department of Labor and funding by a federal program called the Trade Adjustment Assistance (TAA) program, Boeing’s benefits include:

Unemployment checks for up to 2 ½ years for both union and non-union production workers and engineers
Reimbursement of up to 90 percent of travel costs for a job interview
Reimbursement of up to 90 percent of moving expenses for a new job relocation, plus an additional relocation allowance of up to $1, 250
Tax credit for nearly 75 percent of health care premiums while unemployed
Eligibility for a grant of up to $25,000 toward the cost of a degree
Up to $10,000 of supplementary pay (over two years) if a worker older than 50 takes a lower-paying job after leaving Boeing

Take into consideration

While this all adds up to a very attractive arrangement for Boeing workers, the fact remains that this is a unique situation created by specific federal funding designed to assist U.S. workers who lose their jobs due to overseas trade or outsourcing. Some would also argue that such generous, government-funded perks for a select group of workers was only possible because of the power of organized labor and its influence on the current administration.

Regardless of how you feel about the forces at play in such a landmark move, the Boeing situation has little impact on the rest of the nation’s employers or its unemployed workers. Established in 1935, unemployment insurance (UI) is a “safety net” program for individuals who lose their jobs by temporarily replacing part of their wages. The basic unemployment insurance program, which provides up to 26 weeks of benefits, is run by individual states. Although the DOL oversees the system, it plays a limited role when the economy is healthy. It typically only manages administrative costs, allowing states to set their own eligibility rules and benefit levels.

During times of recession, however, the federal government has stepped in. In 2008, for example, the federally funded Emergency Unemployment Compensation was created to extend benefits to unemployed workers who exhausted their regular state benefits. It was modified several times, including the American Taxpayer Relief Act of 2012, which pushed the expiration date of the EUC program to Jan. 1, 2014. To date, Congress has not approved any further extensions to federal long-term unemployment aid, even though the Senate proposed a bill in April 2014 that would provide another five months of benefits to affected individuals.

Jaime Lizotte
Presented by: Jaime Lizotte,
HR Solutions Manager
Hiring, recordkeeping, time and attendance tracking, employee discipline, filing 1099 and W2s ... all of these tasks create overhead expenses and detract from revenue-generating activities.