Ready to Work Act of 2026
- Sponsor
- Sen. Van Hollen, Chris [D-MD]
- Committees
- Health, Education, Labor, and Pensions Committee (primary)
- Last action
- Sep 28, 2026
Bottom line
The bill aims to combat long-term unemployment and boost local economies by funding temporary job placements and comprehensive support services for eligible workers, with a specific focus on distressed communities.
What it actually does
The Ready to Work Act of 2026 establishes a federal jobs initiative for long-term unemployed workers, administered through local workforce boards. It provides funding for wages, compensation, career services, supportive services, and training for eligible workers in temporary program positions designed to lead to long-term employment. Additionally, it offers competitive grants to high-poverty areas or areas with chronically low employment rates, allowing for modified program standards to foster economic development and job growth.
Proponents argue
Proponents argue the bill directly addresses rising long-term unemployment and job market pessimism, particularly concerning artificial intelligence's impact, by providing critical pathways back into the workforce. They highlight its focus on removing barriers to employment, offering job readiness training, and creating work opportunities in local communities, thereby strengthening the economy and supporting vulnerable populations.
Opponents contend
Potential opponents might argue that such federal job programs can be inefficient, create temporary rather than sustainable employment, or distort local labor markets. Concerns could also be raised about the administrative burden on local boards and the potential for displacement of existing workers, despite the bill's nondisplacement provisions.
The bill is moderately detailed, requiring careful reading to understand its various provisions, funding mechanisms, and references to existing workforce development law.
Section 4(a)
Federal Jobs Initiative Establishment
This section mandates the Secretary of Labor to create and manage a jobs initiative for eligible workers, to be carried out through local workforce boards. These boards can partner with community-based organizations. The Secretary will enter into 4-year agreements with these entities, providing payments to cover eligible costs for wages, compensation, career services, supportive services, training, and administrative expenses.
Supporters argue
Supporters argue this establishes a vital framework to address long-term unemployment directly, leveraging existing local workforce infrastructure to deliver services efficiently.
Critics contend
Critics might argue that creating new federal programs can lead to bureaucratic overhead and may not be the most effective way to stimulate private sector job growth.
Tradeoffs
Balances the need for direct job creation with the potential for administrative complexity and reliance on government funding.
Section 3(3)
Eligibility Criteria for Workers
This provision defines an 'eligible worker' as an individual who is at least 18 years old, authorized to work in the U.S., has not been employed or a full-time student for a period of not less than 27 weeks, and has been actively seeking employment for at least 4 weeks. These timeframes can be modified under Section 5(e) for programs in high-poverty areas.
Section 4(e)
Employer Selection and Responsibilities
Local boards are responsible for selecting participating employers, which can include government agencies, nonprofits, social enterprises, or businesses. Employers must agree to provide wages at or above the highest of federal, state, or local minimum wage, or a rate based on the poverty line for a family of four, and offer comparable benefits. They must also ensure advancement opportunities and fulfill administrative duties like payroll and tax withholding. Worker feedback and labor organization input are required for employer selection.
Section 4(f)
Protection Against Worker Displacement
This section prohibits participating employers from using program positions to displace existing employees, reduce their hours or wages, infringe on promotional opportunities, or replace striking workers. It also limits the percentage of program positions within an employer (generally 10%, with exceptions for small businesses, large employers, high unemployment areas, worker-owned enterprises, or collective bargaining agreements).
Section 4(g)
Formal Grievance and Arbitration Process
Local boards must establish a grievance procedure for participants, labor organizations, and other interested individuals concerning participating employers and proposed placements. Grievances must be filed within one year (except for fraud/criminal activity), with hearings within 30 days and decisions within 60 days. Adverse decisions can be submitted to binding arbitration. Remedies include payment suspension, termination, and reinstatement for displaced employees.
Sections 4(h) and 4(i)
Funding Structure and Cost Sharing
This section defines eligible costs for wages (at least minimum wage or a poverty-line-based rate), compensation (non-wage expenses up to 20% of wages), career/supportive/training services (up to 20% of total wages), and administration (up to 10% of total wages). Wages and compensation are generally funded for the first 12 months, extendable for training leading to credentials. The employer share for wages and compensation starts at 33% in areas with 5% or less unemployment, decreasing as unemployment rises, and is 50% for the second year of certain training programs.
Section 5
Targeted Grants for Economic Development
This section authorizes competitive grants to local boards in 'high-poverty areas' (poverty rate >= 20% for 3+ years) or areas with chronically low 'prime working-age employment-to-population ratios' (age 25-54). These grants cover added costs for programs that can modify standards like worker eligibility duration, employer program position limits, funding duration, and cost-sharing, to achieve economic development and job growth.
Requires eligible workers, before applying for a program position, to submit a report to the Secretary of Labor detailing their most recent employment, reason for ending, and any artificial intelligence used in that employment or during their job-seeking process (hiring, resume screening, or interview).
Section 4(e)(4)
Why it matters:Likely standard legislative practice to place duties related to program participation within the relevant operational section. However, its specific nature (AI usage) might be easily overlooked.
Case for: Proponents would argue this data collection is crucial for understanding the evolving impact of AI on the labor market and unemployment, informing future policy and program design.
Case against: Critics might argue this places an undue burden on unemployed individuals already facing significant challenges, potentially creating a barrier to program entry or raising privacy concerns about data collection on AI usage.
Estimated impact: Could generate a unique dataset on AI's real-world impact on employment and job searching, potentially influencing future workforce policy.
Includes approved national service positions (under the National and Community Service Act of 1990) as 'program positions.' It also specifies that eligible workers in such positions are not considered employees of the participating employer, in parity with existing national service law, and the employer is considered a 'service sponsor.'
Section 3(9)(A)(ii)(III) and (B)
Why it matters:Standard legislative practice for defining terms and ensuring consistency with existing law.
Case for: Supporters would argue this expands the types of valuable work opportunities available to the long-term unemployed, leveraging established national service infrastructure and potentially offering education awards.
Case against: Critics might raise questions about the employment status of these workers, arguing that if they are performing work for a 'participating employer,' they should be considered employees with full labor protections, rather than volunteers or service members.
Estimated impact: Broadens the scope of available job placements and integrates the program with national service initiatives, potentially increasing the number of available positions and offering different types of benefits (e.g., education awards).
Specifies that eligible costs for wages must be at a rate that is the greatest of the federal minimum wage, state/local minimum wage, or 'a rate, calculated as an amount per hour, with the amount determined by dividing the poverty line for a family of 4 by 2,080.'
Section 4(h)(1)(B)(iii)
Why it matters:Technical detail within a complex funding formula.
Case for: Proponents would argue this ensures a living wage floor for program participants, tying compensation directly to a measure of economic need rather than just statutory minimums, which may be insufficient in many areas.
Case against: Critics might argue that tying wages to the poverty line for a family of four, regardless of the individual worker's family size, could set an artificially high wage floor in some areas, potentially increasing program costs or making it harder for employers to participate.
Estimated impact: Could significantly increase the minimum wage paid to program participants above federal or state minimums in many jurisdictions, ensuring a more substantial income for participants.