Our nation is facing an unemployment crisis unlike anything we have seen for quite some time. Today’s announcement for September’s unemployment numbers is another reminder of how serious our problem is.
Since President Obama took office in January 2009, the number of people unemployed for more than 27 weeks has increased by 124 percent. Equally disturbing is the fact that the average number of weeks it takes for job seekers to find a job is about 40 weeks, the second longest average time that Americans have been unemployed since the statistic was first recorded in 1948.
I am fully committed to helping fix our unemployment problem and helping the long-term unemployed find work, but the provision in the President’s “jobs bill” that would prohibit employers from discriminating against job applicants because they are unemployed is the wrong approach, and may actually do more harm than good.
Title III of the President’s bill takes the unprecedented step of allowing unemployed people to sue on the basis of discrimination if they are not hired for a job, regardless of whether or not the claim is valid.
Under the proposal, it would be “an unlawful employment practice” if a business with 15 or more employees refused to hire a person “because of the individual’s status as unemployed.” Although it would be almost impossible to prove this, unsuccessful job applicants could sue and recover damages for violations, just as when an employer discriminates on the basis of a person’s race, color, religion, sex or national origin.
There are some policies in the “American Jobs Act” that House Republicans agree with, but this is not one of them. This provision creates more business for trial lawyers, not small businesses, by opening the floodgates to increased litigation.
Small businesses already face the harsh reality of burdensome and complex regulations during a down economy. The fear of a discrimination lawsuit under Title III would particularly disincentivize them from hiring new employees, contrary to the very purpose of the plan. A 2007 study, commissioned by the Institute for Legal Reform, concluded that small businesses alone pay $98 billion a year due to frivolous law suits – money that could have been used to hire more workers, expand businesses, or improve employee benefits.
As Chairman of the House Small Business Committee, I hear about government policies that burden entrepreneurs and prevent small business job creation every week. This lawsuit threat may be one of the most onerous.