President Barack Obama has proposed adding $14 billion to the Labor Department's 2011 budget in an effort to curtail unemployment insurance fraud, and to swell the ranks of officials enforcing proper worker classification, the Wall Street Journal reports.
Under the proposed budget, improper payments could be reduced by $4 billion and employer tax evasion by $300 million over the next 10 years, the Journal writes. Labor Secretary Hilda Solis said in an online chat that the department is seeking to allocate $1.7 billion for worker protection programs, and hire approximately 177 new inspectors.
In addition to the budget increases, the administration is also proposing a joint effort between the Labor and Treasury departments to enforce proper worker classification, according to the paper. Treasury would receive $7 billion over the next 10 years; Labor would receive an additional $25 million to hire 100 enforcement personnel.
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Divisions affected by the budget increase include the Employee Benefits Administration, the Occupational Safety and Health Administration, and the Wage and Hour Division.
Among some of the other reforms included in the budget are:
- Helping states provide paid family leave to workers. The budget establishes a $50 million fund for states that choose to launch paid-leave programs.
- Improving retirement security. The budget establishes automatic pensions through direct-deposit IRAs to expand access to retirement plans for workers. Small businesses would be exempt. The budget also doubles the small employer pensions plan startup credit, which offers a tax credit equal to 50 percent of the start-up expenses of a new retirement plan.
- Improving the defined-contribution savings system. The department will "undertake regulatory efforts to reduce barriers to annuitization of 401(k) plan assets; increase the transparency of pension fees; improve transparency of target date and other default retirement investments; and reduce conflicts of interest between pension advisers and fiduciaries."
- Expanding opportunities for automatic enrollment in 401(k) plans. The budget proposes to make it easier for 401(k) plans to adopt automatic enrollment, and to allow auto-enrollment in SIMPLE IRAs.
Click here to read the full budget outline for the Department of Labor.
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