If a program in North Dakota where most farm employment is comparatively table, covering essentially permanent workers only, and at an exceedingly high ax rate-will not balance out-it is obvious that the enactment of farm labor overage as proposed would involve a heavy drain on state funds. Senator BYRD. The next witness is Dr. Arthur M. Ross, vice presient, University of Michigan. Dr. Ross is accompanied by Milton C. Denbo, counsel, American Council on Education. TATEMENT OF DR. ARTHUR M. ROSS, VICE PRESIDENT, UNIVER- Dr. Ross. Mr. Chairman, members of the committee, I am Arthur The American Council on Education in 1965 and again this past ar in a statement presented to the House Ways and Means Comttee, requested an exemption from coverage for faculty and other ofessional research and administrative personnel employed by titutions of higher education. The bill as passed by the House in 59 does contain this exemption. We presently recognize, however, t changing employment conditions in the academic world call for evaluation of our former position. I might say parenthetically that sreevaluation has been made in great depth by the Commission on deral Relations of the American Council, which includes a good ny long experienced and distinguished presidents of universities, h as Father Hesburgh of Notre Dame, Dr. Brewster of Yale, Presit Arthur Flemming of Macalester, and other highly experienced noted individuals. wish to state, therefore, that we believe it appropriate to delete from R. 14705 the provision which exempts individuals employed in an instructional, research or principal administrative capacity from the requirement of coverage for employees of State and nonprofit institutions of higher education. Since the extent of unemployment is low among such personnel, deletion of the exemption need not add significantly to the costs of the organization. By covering those who are genuinely unemployed the bill is equitable in that it would place unemployed workers in the enumerated categories in nonprofit educational institutions within a protected category available to most employees in the American economy. We agree that in terms of simple equity, occupational exclusion is undesirable because it would deny to those in the excluded categories the unemployment insurance protection enjoyed by their counterparts in private industry. We recognize that an instructional, research or administrative employee, whose contract has not been renewed at the end of the contractual period, is in no different position than any other individual whose job has been terminated, and that he should receive the benefits that accrue to individuals of his status. However, there is one distinctive characteristic of the contractual employment relationship between the instructor, researcher or administrative employee and the institution, which in our judgment requires a special statutory provision not now in the bill. Frequently the employee is employed pursuant to an annual contract at an annual salary, but for an active work period of 9 rather than 12 months. It is also common for an institution, as a matter of convenience, to pay employees during the time that the college is actually in session, dividing the full year's salary, for example, into 9ths or 10ths and paying them in the months from September through May or June, inclusive. These annual salaries are intended to cover periods such as the summer when the employees may be relieved of formal assignments. During these periods the employment relationship continues and the employee has been compensated for a full year. We believe that in this typical situation the employee should not be considered unemployed during the summer periods, a semester break, a sabbatical period or similar periods during which the employment relationship continues. H.R. 14705 contains a provision which deals with the summer period by allowing State laws to provide the extent to which benefits based on services to an institution of higher education shall not be payable during the summer vacation period. The provision, however, is permissive in nature only and not mandatory on the States and does not aid in solving the ultimate problem, as separate battles over this very issue would have to be fought in the legislatures of the 50 States. If, as we advocate, unemployment insurance coverage is to be extended to teaching and associated research and administrative personnel, explicit language should be inserted into the act to make it plain that such personnel are not regarded as unemployed during those periods of academic recess when they, paid on an annual basis, remain on the rolls of a college or university, but are not necessarily required to perform services on the employer's premises. Appended hereto as appendix A is suggested statutory language which we believe would aid in solving the problem of extending protection to those instructional, research and administrative employees who may become genuinely unemployed. It is my understanding, Mr. Chairman, that Secretary of Labor Shultz concurs in the desirability and appropriatenes of this clarifying proviso. We would also like to request that the student exclusion contained in the House bill be retained. An additional group of "employees"student spouses should also continue to be excluded from coverage. Both the institution and the student spouse recognize that the spouse's employment is in no sense permanent employment. Often the student's spouse is only temporarily in the labor market. When the student graduates, both he and his spouse move elsewhere and undertake to pursue a conventional existence there. A failure to exclude the spouse from coverage could lead to many unjustified, although technically valid claims for compensation. We, therefore, respectfully request that section 106 of H.R. 14705 be retained. Mr. Chairman, as our appendix shows, the other educational organizations, apart from the American Council on Education, which join in this testimony, include the American Association of Junior Colleges, the American Association of University Professors (as to faculty), the Association of American Universities, the National Assoiation of State Universities and Land Grant Colleges, and the Naional Catholic Educational Association. Thank you. I shall be glad to answer any questions. Senator ANDERSON (now presiding). Any questions? (Appendixes to Dr. Ross' statement follow :) 1. Delete Section 3309 (b) (4). APPENDIX A 2. Insert a new paragraph 6(A) in section 3304 (a) of the Internal Revenue Code as amended which would read as follows: (6) (A) compensation is payable on the basis of service to which section 309(a)(1) applies, in the same amount, on the same terms, and subject to he same conditions as compensation payable on the basis of other service subject o such law; except that, with respect to service in an instructional, research, r principal administrative capacity in an institution of higher education to which section 3309 (a) (1) applies, compensation shall not be payable based n such service for any week commencing during the period between two sucessive academic years (or, when the contract provides instead for a similar eriod between two regular but not successive terms, during such period) to ny individual who has a contract to perform services in any such capacity for ny institution of higher education for both such academic years or both such rms. APPENDIX B The following Organizations join in the foregoing testimony of the American ouncil on Education: merican Association of Junior Colleges merican Association of University Professors (as to faculty) ssociation of American Universities ational Association of State Universities and Land-Grant Colleges ational Catholic Educational Association Senator ANDERSON. We will meet at 10 o'clock tomorrow morning ere. (Whereupon, at 11:40 a.m., the hearing was recessed, to reconvene 10 a.m., Wednesday, February 18, 1970.) UNEMPLOYMENT COMPENSATION WEDNESDAY, FEBRUARY 18, 1970 U.S. SENATE, COMMITTEE ON FINANCE, Washington, D.C. The committee met, pursuant to recess, at 10 a.m., in room 2221, New Senate Office Building, Hon. Clinton P. Anderson, presiding. Present: Senators Anderson, Gore, Byrd, Jr., of Virginia, Williams of Delaware, Bennett, Fannin, and Hansen. Senator ANDERSON (presiding). Mr. Hubbard, NAM. And will the witnesses please stay inside their 10 minutes. Senator BENNETT. Mr. Chairman, before Mr. Hubbard begins, I think it might be well to remind the witnesses that we are going to have to leave soon after 11 o'clock because we have got a vote which could be two votes, and that might make it difficult for us to get back. So, I hope nobody will go beyond the 10 minutes. We would like to get through as many witnesses as we can during the time we have. Senator ANDERSON. I have a statement that Senator Mondale prepared for the committee. Without objection, it will be printed at this point in the record. And I also have three or four telegrams that I suggest be put in the record. (The statement and telegrams referred to follow :) STATEMENT OF HON. WALTER F. MONDALE, A U.S. SENATOR FROM THE STATE OF Mr. Chairman and members of the Committee, I thank you for the opportunity Sometime in the second half of 1970, a State employment security agency will pay a worker who has become unemployed the 50 billionth dollar in unemloyment insurance benefits which have been paid since the unemployment insurnce payments began in 1936. Farmworkers have not received a single penny of ne $50 billion. In 1969 alone, more than 4 million persons received over 2 billion dollars unemployment insurance payments, but no farmworkers received benefits à 1969. Workers in some 58 million jobs, 77 percent of all jobs in the United States, re protected by an unemployment insurance program against total loss of wages uring spells of unemployment. H.R. 14705 would cover 4.5 million additional bs, bringing the total coverage to 84 percent of all jobs. Another 10 percent of l jobs are uncovered State and local government jobs. Every major job classifiation in private industry is covered by unemployment insurance, except farmork. But, farmworkers remain excluded. (213) ESS |