Houghtaling & Downey Bill Establishing Fund to Assist Locked-Out Workers With Regard to Health Insurance Benefits Clears Assembly Panel

In an effort to assist people who are stripped of their health insurance because of a labor dispute, Assembly Members Eric Houghtaling and Joann Downey are sponsoring legislation creating the Working Family Health Security Fund. The bill was approved by the Assembly Labor Committee Thursday.

“Health insurance is one of the most critical things an individual can possess,” said Houghtaling. “It is only fair to assist individuals who, to no fault of their own, are suddenly stripped of their ability to utilize their health insurance because of a labor dispute.”

“No one should be at risk of being forced into suffocating debt because of a lack of health insurance, especially if their insurance was discontinued due to a work stoppage,” said Downey.  “It is our responsibility to protect our residents and ensure that they are provided with the health insurance they had been assured.”

The bill (A-1056) establishes the Working Family Health Security Fund in the Department of Labor and Workforce development for the purpose of providing monetary assistance needed for individuals to pay for continuation coverage under the COBRA continuation provision.

In order for a person to be eligible to access these funds, they must:

  • work for an employer that provides a health benefits plan in New Jersey;
  • have their health insurance coverage discontinued because of a work stoppage due to a labor dispute at the employee’s workplace that prevents them from working, even though the employee’s union has directed the employees in the collective bargaining unit to work under the pre-existing terms and conditions of employment;
  • have not engaged in a strike immediately before being prevented from working; and
  •  file an application on a form provided by the Commissioner of Labor and Workforce Development demonstrating that they meet the requirements to qualify for assistance.

According to the bill, the payments by the fund are to be discontinued whenever the employer reinstates the insurance coverage.

The employer is required to provide the commissioner with all information, including the costs of the health insurance coverage, deemed necessary by the commissioner and to comply with the commissioner’s directives in a timely fashion.

An employer that caused the fund to be depleted due to payments for employee COBRA coverage as a result of a work stoppage because of a labor dispute will be responsible for reimbursing the fund for the cost of the coverage during the work stoppage.

The bill will be supported by an annual five-cent surcharge per employee for all employers who are subject to the “unemployment compensation law,” provided that the surcharge would not be collected during any year for which the balance of the Working Family Health Security Fund was more than $5 million as of September 1 of the preceding year.

The bill will now go to the Assembly Appropriations Committee for further consideration.


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