Health Care and Education Reconciliation Act of 2010

Floor Speech

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Ms. COLLINS. Madam President, I rise to speak on behalf of the amendment I have offered which would waive the job-killing fines in the reconciliation bill in cases where an employer hires an unemployed worker.

I think these penalties will come as a surprise to most Americans. With unemployment at 9.7 percent, and a real concern that we may be on the brink of a double-dip recession, most Americans will be shocked to learn that Washington wants to slap fines on small businesses that choose to hire more workers. But the new health care law does exactly that.

Incredibly, this reconciliation package makes this problem even worse. Here is how. In the reconciliation package, small businesses that cannot afford to provide health insurance to their employees would be fined $2,000 for each worker on their payroll. The way the formula works, the fines kick in at $40,000 when a small business reaches 50 employees. After that, they go up at a rate of $2,000 for each new worker.

Imagine what this will do to job growth. Our country relies on small businesses to create new jobs. In fact, time and time again, you will hear on the Senate floor that small businesses are the engine of the American economy. I certainly agree with that. But this reconciliation bill creates a wall--40,000 dollars high--around any small business that wants to grow past 49 workers.

Think what these job-killing penalties will mean to the unemployed. More than 8 million Americans have lost their jobs since 2007. More than 6 million have been unemployed longer than 27 weeks. But beyond even these grim statistics, the true picture of unemployment in this country is actually far worse. Broader measures of unemployment show that 16 percent of the American people are without jobs or cannot find full-time work.

I recognize some in this body will argue we should not be bothered with these penalties now because they do not become effective right away. But those who would say such a thing simply do not understand how small businesses work. We are not talking about big multinational conglomerates here. We are talking about Main Street businesses that are already struggling. Many of them are family-owned enterprises. They do not look at their employees as interchangeable parts, and they do not make hiring decisions to ``get rich quick.'' When they bring a new employee on board, they are choosing someone who they know will become part of their team and the face of their business to the community they serve.

Having these fines on the books will discourage job growth now, no matter when they become effective, because small businesses will not hire and train workers today just to fire them tomorrow when these penalties go into effect.

Ironically, less than a week ago, the President signed into law the so-called HIRE Act. It contains a provision authored by Senators SCHUMER and HATCH to provide a temporary tax credit to encourage companies to hire unemployed workers. That is a creative idea, and I supported it. But for the life of me, I do not understand how a week later we could vote for a bill that imposes fines that will hit small businesses when they hire new workers.

This makes no sense to me, and it is completely contrary to the policy we passed a week ago when we gave tax credits to encourage businesses to hire workers who are unemployed. With this bill, we are going to fine them if they hire workers who are unemployed if they cannot afford to provide them with health insurance. That is why I am offering this commonsense amendment. It would waive the fines, the onerous fines that are in the reconciliation bill when small businesses and medium-size businesses hire workers who were previously unemployed.

The mechanism to determine which workers qualify is exactly the same one we adopted in the jobs bill passed by this body last week. It is the height of irony that we would even consider imposing penalties and fines on businesses that are hiring more workers, particularly during this difficult economic time.

I encourage my colleagues to support this commonsense amendment.

Thank you, Madam President.

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Ms. COLLINS. Mr. President, just last week we passed the HIRE Act, which included a tax credit offered by Senator Schumer and Senator Hatch to encourage companies to hire unemployed workers. It makes no sense for any of us to have voted for that bill and then not to support the amendment that I have offered.

The amendment I am offering would waive the onerous fines that are in this bill for small businesses that hire unemployed workers. If you voted for the HIRE Act giving a tax credit, why in the world would you support a policy of imposing penalties on businesses that hire unemployed workers?

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