SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Keep Americans Working Act''.

SEC. 2. PURPOSE.

    The purpose of this Act is to keep Americans working by 
strengthening and expanding short-time compensation programs that 
provide employers with an alternative to layoffs.

SEC. 3. TREATMENT OF SHORT-TIME COMPENSATION PROGRAMS.

    (a) In General.--Section 3306 of the Internal Revenue Code of 1986 
is amended by adding at the end the following new subsection:
    ``(v) Short-time Compensation Program.--For purposes of this 
chapter, the term `short-time compensation program' means a program 
under which--
            ``(1) the participation of an employer is voluntary;
            ``(2) an employer reduces the number of hours worked by 
        employees through certifying that such reductions are in lieu 
        of temporary layoffs;
            ``(3) such employees whose workweeks have been reduced by 
        at least 10 percent are eligible for unemployment compensation;
            ``(4) the amount of unemployment compensation payable to 
        any such employee is a pro rata portion of the unemployment 
        compensation which would be payable to the employee if such 
        employee were totally unemployed;
            ``(5) such employees are not expected to meet the 
        availability for work or work search test requirements while 
        collecting short-time compensation benefits, but are required 
        to be available for their normal workweek;
            ``(6) eligible employees may participate in an employer-
        sponsored training program to enhance job skills if such 
        program has been approved by the State agency;
            ``(7) beginning on the date which is 2 years after the date 
        of enactment of this subsection, the State agency shall require 
        an employer to certify that continuation of health benefits and 
        retirement benefits under a defined benefit pension plan (as 
        defined in section 3(35) of the Employee Retirement Income 
        Security Act of 1974) is not affected by participation in the 
        program;
            ``(8) the State agency shall require an employer (or an 
        employer's association which is party to a collective 
        bargaining agreement) to submit a written plan describing the 
        manner in which the requirements of this subsection will be 
        implemented and containing such other information as the 
        Secretary of Labor determines is appropriate;
            ``(9) in the case of employees represented by a union, the 
        appropriate official of the union has agreed to the terms of 
        the employer's written plan and implementation is consistent 
        with employer obligations under the National Labor Relations 
        Act; and
            ``(10) the program meets such other requirements as the 
        Secretary of Labor determines appropriate.''.
    (b) Assistance and Guidance in Implementing Programs.--
            (1) Assistance and guidance.--
                    (A) In general.--In order to assist States in 
                establishing, qualifying, and implementing short-time 
                compensation programs, as defined in section 3306(v) of 
                the Internal Revenue Code of 1986 (as added by 
                subsection (a)), the Secretary of Labor (in this 
                section referred to as the ``Secretary'') shall--
                            (i) develop model legislative language 
                        which may be used by States in developing and 
                        enacting short-time compensation programs and 
                        shall periodically review and revise such model 
                        legislative language;
                            (ii) provide technical assistance and 
                        guidance in developing, enacting, and 
                        implementing such programs;
                            (iii) establish biannual reporting 
                        requirements for States, including number of 
                        averted layoffs, number of participating 
                        companies and workers, and retention of 
                        employees following participation; and
                            (iv) award start-up grants to State 
                        agencies under subparagraph (B).
                    (B) Grants.--
                            (i) In general.--The Secretary shall award 
                        start-up grants to State agencies that apply 
                        not later than September 30, 2010, in States 
                        that enact short-time compensation programs 
                        after the date of enactment of this Act for the 
                        purpose of creating such programs. The amount 
                        of such grants shall be awarded depending on 
                        the costs of implementing such programs.
                            (ii) Eligibility.--In order to receive a 
                        grant under clause (i) a State agency shall 
                        meet requirements established by the Secretary, 
                        including any reporting requirements under 
                        clause (iii). Each State agency shall be 
                        eligible to receive not more than one such 
                        grant.
                            (iii) Reporting.--The Secretary may 
                        establish reporting requirements for State 
                        agencies receiving a grant under clause (i) in 
                        order to provide oversight of grant funds used 
                        by States for the creation of short-time 
                        compensation programs.
                            (iv) Funding.--There are appropriated, out 
                        of any moneys in the Treasury not otherwise 
                        appropriated, to the Secretary, such sums as 
                        the Secretary certifies as necessary for the 
                        period of fiscal years 2010 and 2011 to carry 
                        out this subparagraph.
            (2) Timeframe.--The initial model legislative language 
        referred to in paragraph (1)(A) shall be developed not later 
        than 60 days after the date of enactment of this Act.
    (c) Reports.--
            (1) Initial report.--Not later than 4 years after the date 
        of enactment of this Act, the Secretary shall submit to 
        Congress and to the President a report or reports on the 
        implementation of this section. Such report or reports shall 
        include--
                    (A) a study of short-time compensation programs;
                    (B) an analysis of the significant impediments to 
                State enactment and creation of such programs; and
                    (C) such recommendations as the Secretary 
                determines appropriate.
            (2) Subsequent reports.--After the submission of the report 
        under paragraph (1), the Secretary may submit such additional 
        reports on the implementation of short-time compensation 
        programs as the Secretary deems appropriate.
            (3) Funding.--There are appropriated, out of any moneys in 
        the Treasury not otherwise appropriated, to the Secretary, 
        $1,500,000 to carry out this subsection, to remain available 
        without fiscal year limitation.
    (d) Conforming Amendments.--
            (1) Internal revenue code of 1986.--
                    (A) Subparagraph (E) of section 3304(a)(4) of the 
                Internal Revenue Code of 1986 is amended to read as 
                follows:
                    ``(E) amounts may be withdrawn for the payment of 
                short-time compensation under a short-time compensation 
                program (as defined in section 3306(v));''.
                    (B) Subsection (f) of section 3306 of the Internal 
                Revenue Code of 1986 is amended--
                            (i) by striking paragraph (5) (relating to 
                        short-term compensation) and inserting the 
                        following new paragraph:
            ``(5) amounts may be withdrawn for the payment of short-
        time compensation under a short-time compensation program (as 
        defined in subsection (v));'', and
                            (ii) by redesignating paragraph (5) 
                        (relating to self-employment assistance 
                        program) as paragraph (6).
            (2) Social security act.--Section 303(a)(5) of the Social 
        Security Act is amended by striking ``the payment of short-time 
        compensation under a plan approved by the Secretary of Labor'' 
        and inserting ``the payment of short-time compensation under a 
        short-time compensation program (as defined in section 3306(v) 
        of the Internal Revenue Code of 1986)''.
            (3) Repeal.--Subsections (b) through (d) of section 401 of 
        the Unemployment Compensation Amendments of 1992 (26 U.S.C. 
        3304 note) are repealed.
    (e) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

SEC. 4. TEMPORARY FINANCING OF CERTAIN SHORT-TIME COMPENSATION 
              PROGRAMS.

    (a) Payments to States With Certified Programs.--
            (1) In general.--Not later than 30 days after the date of 
        enactment of this Act, the Secretary shall establish a program 
        under which the Secretary shall make payments to any State 
        unemployment trust fund to be used for the payment of 
        unemployment compensation if the Secretary approves an 
        application for certification submitted under paragraph (3) for 
        such State to operate a short-time compensation program (as 
        defined in section 3306(v) of the Internal Revenue Code of 1986 
        (as added by section 3(a))) which requires the maintenance of 
        health and retirement employee benefits as described in 
        paragraph (7) of such section 3306(v), notwithstanding the 
        otherwise effective date of such requirement.
            (2) Full reimbursement.--Subject to subsection (d), the 
        payment to a State under paragraph (1) shall be an amount equal 
        to 100 percent of the total amount of benefits paid to 
        individuals by the State pursuant to the short-time 
        compensation program during the period--
                    (A) beginning on the date a certification is issued 
                by the Secretary with respect to such program; and
                    (B) ending on September 30, 2011.
            (3) Certification requirements.--
                    (A) In general.--Any State seeking full 
                reimbursement under this subsection shall submit an 
                application for certification at such time, in such 
                manner, and complete with such information as the 
                Secretary may require (whether by regulation or 
                otherwise), including information relating to 
                compliance with the requirements of paragraph (7) of 
                such section 3306(v). The Secretary shall, within 30 
                days after receiving a complete application, notify the 
                State agency of the State of the Secretary's findings 
                with respect to the requirements of such paragraph (7).
                    (B) Findings.--If the Secretary finds that the 
                short-time compensation program operated by the State 
                meets the requirements of such paragraph (7), the 
                Secretary shall certify such State's short-time 
                compensation program thereby making such State eligible 
                for full reimbursement under this subsection.  
    (b) Timing of Application Submittals.--No application under 
subsection (a)(3) may be considered if submitted before the date of 
enactment of this Act or after the latest date necessary (as specified 
by the Secretary) to ensure that all payments under this section are 
made before September 30, 2011.
    (c) Terms of Payments.--Payments made to a State under subsection 
(a)(1) shall be payable by way of reimbursement in such amounts as the 
Secretary estimates the State will be entitled to receive under this 
section for each calendar month, reduced or increased, as the case may 
be, by any amount by which the Secretary finds that the Secretary's 
estimates for any prior calendar month were greater or less than the 
amounts which should have been paid to the State. Such estimates may be 
made on the basis of such statistical, sampling, or other method as may 
be agreed upon by the Secretary and the State agency of the State 
involved.
    (d) Limitations.--
            (1) General payment limitations.--No payments shall be made 
        to a State under this section for benefits paid to an 
        individual by the State pursuant to a short-time compensation 
        program that is in excess of 26 weeks of benefits.
            (2) Employer limitations.--No payments shall be made to a 
        State under this section for benefits paid to an individual by 
        the State pursuant to a short-time compensation program if such 
        individual is employed by an employer--
                    (A) whose workforce during the 3 months preceding 
                the date of the submission of the employer's short-time 
                compensation plan has been reduced by temporary layoffs 
                of more than 20 percent;
                    (B) on a seasonal, temporary, or intermittent 
                basis; or
                    (C) engaged in a labor dispute.
            (3) Program payment limitation.--In making any payments to 
        a State under this section pursuant to a short-time 
        compensation program, the Secretary may limit the frequency of 
        employer participation in such program.
    (e) Charging Rule.--Under a short-time compensation program 
reimbursed under this section, a State may require short-time 
compensation benefits paid to an individual to be charged to a 
participating employer regardless of the base period charging rule.
    (f) Retention Requirement.--
            (1) In general.--A participating employer under this 
        section is required to comply with the terms of the written 
        plan approved by the State agency and act in good faith to 
        retain participating employees, and the State shall, in the 
        event of any violation, require such employer to repay to the 
        State a sum based on the amount expended by the State under the 
        program as a result of that violation.
            (2) Oversight and monitoring.--The Secretary shall 
        establish an oversight and monitoring process by regulation by 
        which State agencies will ensure that participating employers 
        comply with the requirements of paragraph (1).
            (3) Penalty remittance.--In the case of any State which 
        receives reimbursement under this section, if such State 
        determines that a violation of paragraph (1) has occurred, the 
        State shall transfer an appropriate amount to the United States 
        of the repayment the State required of the employer pursuant to 
        such paragraph.
    (g) Funding.--There are appropriated, from time to time, out of any 
moneys in the Treasury not otherwise appropriated, to the Secretary, 
such sums as the Secretary certifies are necessary to carry out this 
section (including to reimburse any additional administrative expenses 
incurred by the States in operating such short-time compensation 
programs).
    (h) Definition of State.--In this section, the term ``State'' 
includes the District of Columbia, the Commonwealth of Puerto Rico, and 
the Virgin Islands.
Keep Americans Working Act - Declares that the purpose of this Act is to keep Americans working by strengthening and expanding short-time compensation programs that provide employers with an alternative to layoffs.

Requires the Secretary of Labor to: (1) provide guidance to states in enacting short-term compensation programs; and (2) award start-up grants to state agencies in states that have enacted programs and meet certain requirements.

Amends the Internal Revenue Code to define "short-time compensation program" as one in which: (1) participation of an employer is voluntary; (2) an employer reduces the number of hours worked by employees through certifying that such reductions are in lieu of temporary layoffs; (3) an employee whose workweek that has been reduced by at least 10% is eligible for unemployment compensation; (4) an eligible employee may participate in an employer-sponsored job skills training program; and (5) an employer is required to certify that continuation of employee health and retirement benefits will not be affected by participation in the program.

Directs the Secretary to make payments to a state's unemployment compensation trust fund for the payment of unemployment compensation if the Secretary approves a state's application for certification to operate a short-time compensation program that requires the maintenance of health and retirement employee benefits.
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