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[Senate Hearing 109-264]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 109-264
 
    ENHANCING COOPERATION BETWEEN EMPLOYERS AND GUARDSMEN/RESERVISTS

=======================================================================

                                HEARING

                               BEFORE THE

            SUBCOMMITTEE ON EMPLOYMENT AND WORKPLACE SAFETY

                                 OF THE

                    COMMITTEE ON HEALTH, EDUCATION,
                          LABOR, AND PENSIONS
                          UNITED STATES SENATE

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                                   ON

    EXAMINING ENHANCING COOPERATION BETWEEN EMPLOYERS AND GUARDSMEN/
  RESERVISTS, FOCUSING ON CIVILIAN AND VETERAN ORGANIZATIONS TO WORK 
    TOGETHER TO REACH OUT TO SOLDIERS RETURNING FROM THE BATTLEFIELD

                               __________

                            OCTOBER 19, 2005

                               __________

 Printed for the use of the Committee on Health, Education, Labor, and 
                                Pensions

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24-166                 WASHINGTON : 2006
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          COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

                   MICHAEL B. ENZI, Wyoming, Chairman

JUDD GREGG, New Hampshire            EDWARD M. KENNEDY, Massachusetts
BILL FRIST, Tennessee                CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee           TOM HARKIN, Iowa
RICHARD BURR, North Carolina         BARBARA A. MIKULSKI, Maryland
JOHNNY ISAKSON, Georgia              JAMES M. JEFFORDS (I), Vermont
MIKE DeWINE, Ohio                    JEFF BINGAMAN, New Mexico
JOHN ENSIGN, Nevada                  PATTY MURRAY, Washington
ORRIN G. HATCH, Utah                 JACK REED, Rhode Island
JEFF SESSIONS, Alabama               HILLARY RODHAM CLINTON, New York
PAT ROBERTS, Kansas

               Katherine Brunett McGuire, Staff Director

      J. Michael Myers, Minority Staff Director and Chief Counsel

                                 ______

            Subcommittee on Employment and Workplace Safety

                    JOHNNY ISAKSON, Georgia Chairman

LAMAR ALEXANDER, Tennessee           PATTY MURRAY, Washington
RICHARD BURR, North Carolina         CHRISTOPHER J. DODD, Connecticut
JOHN ENSIGN, Nevada                  TOM HARKIN, Iowa
PAT ROBERTS, Kansas                  BARBARA A. MIKULSKI, Maryland
MICHAEL B. ENZI, Wyoming (ex         JAMES M. JEFFORDS (I), Vermont
officio)                             EDWARD M. KENNEDY, Massachusetts 
                                     (ex officio)

                       Glee Smith, Staff Director

                William Kamela, Minority Staff Director

                                  (ii)

                            C O N T E N T S

                               __________

                               STATEMENTS

                      WEDNESDAY, OCTOBER 19, 2005

                                                                   Page
Isakson, Hon. Johnny, Chairman, Subcommittee on Employment and 
  Workplace Safety, opening statement............................     1
Murray, Hon. Patty, a U.S. Senator from the State of Washington, 
  opening statement..............................................     3
Roberts, Hon. Pat, a U.S. Senator from the State of Kansas, 
  opening statement..............................................     6
    Prepared statement...........................................     7
Burr, Hon. Richard, a U.S. Senator from the State of North 
  Carolina, opening statement....................................     8
Gregg, Hon. Judd, a U.S. Senator from the State of New Hampshire, 
  prepared statement.............................................     9
Kennedy, Hon. Edward M., a U.S. Senator from the State of 
  Massachusetts, prepared statement..............................    10
Hollingsworth, Bobby, Executive Director, National Committee for 
  Employer Support of the Guard and Reserve, Washington, DC; 
  Dennis Donovan, Executive Vice President, Human Resources, Home 
  Depot, Inc., Atlanta, GA; Christine Bierman, Chief Executive 
  Officer, Colt Safety, Fire and Rescue, St. Louis, MO; Lisa 
  Nisenfeld, Executive Director, Southwest Washington Workforce 
  Development Council, Vancouver, WA; and Ronald J. Fry, 
  Portfolio Management Associate, Wachovia Corporation, and 
  Sergeant First Class, North Carolina Army National Guard, 
  Charlotte, NC..................................................    12
    Prepared statements of:
        Mr. Hollingsworth........................................    15
        Mr. Donovan..............................................    17
        Ms. Bierman..............................................    21
        Ms. Nisenfeld............................................    24
        Mr. Fry..................................................    28
Jeffords, Hon. James M., a U.S. Senator from the State of 
  Vermont, prepared statement....................................    34

                          ADDITIONAL MATERIAL

Statements, articles, publications, letters, etc.:
    Response to questions of Senator Kennedy and Senator Jeffords 
      by Christine Bierman.......................................    41
    Response to questions of Senator Kennedy and Senator Jeffords 
      by Dennis Donovan..........................................    42
    Response to question of Senator Jeffords by Bob Hollingsworth    42
    Response to questions of Senator Kennedy by Bob Hollingsworth    43
    Response to questions of Senator Kennedy and Senator Jeffords 
      by Lisa Nisenfeld..........................................    45

                                 (iii)

  

    ENHANCING COOPERATION BETWEEN EMPLOYERS AND GUARDSMEN/RESERVISTS

                              ----------                              

                      WEDNESDAY, OCTOBER 19, 2005

                                       U.S. Senate,
Subcommittee on Employment and Workplace Safety, Committee 
                 on Health, Education, Labor, and Pensions,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:00 p.m., in 
Room 430, Dirksen Senate Office Building, Hon. Johnny Isakson 
[chairman of the subcommittee] presiding.
    Present: Senators Isakson, Burr, Roberts, Murray, and 
Jeffords.

                  Opening Statement of Senator Isakson

    Senator Isakson. I call the Subcommittee on Employment and 
Workplace Safety hearing to order and we will get started. We 
have members including ranking member Murray on the way. 
Senator Burr is also coming, but I want to be prompt in 
beginning so I will start with my opening statement, and 
hopefully others will come in and we will recognize them before 
we hear from our distinguished panelists.
    I would like to start by saying this. I was a member of the 
Georgia National Guard for 6 years. I ran a company for 22 
years and employed guardsmen and reservists. Now I have served 
in the U.S. Senate and the U.S. House and voted to commit our 
young men and women in the Reserve to defend freedom around the 
world. There is nothing more important to us as a nation than a 
ready Reserve that is ready, that is trained, and is staffed to 
do the jobs we would never anticipate doing.
    There is not a one of us that would have guessed that 
September 11, 2001 would have ever happened, or that within 
months after that we would have guardsmen and reservists 
deployed in Afghanistan, Iraq, and around the world.
    The companies that are here today and those that are here 
in support of our men and women are real heroes to me. We are 
going to hear from three companies that go above and beyond the 
call of duty in the support of their employees who are members 
of the Reserve and the Guard. The purpose of the hearing is to 
really focus the light of day and shine the light, the 
spotlight, on these great companies and what they have done.
    It is critical that we continue in this difficult world of 
ours to have the best trained, best equipped, best staffed 
Reserve and Guard anywhere in the world. Because of the 
employers that we have, we have that, and today, I am proud to 
commend them to all of you.
    Given the vital role employers play, the National Committee 
for Employer Support of the Guard and Reserve, or ESGR, was 
established in 1972 to promote cooperation between reservists 
and their civilian employers and to help resolve any conflicts 
that may arise due to employees' military commitment. Today, we 
are very pleased to have Bob Hollingsworth here, who is the 
Executive Director of that distinguished committee.
    The USERRA Act, which was passed by Congress in 1994, 
requires minimum requirements of American business, not to 
discriminate in the hiring of guardsmen and reservists and to 
ensure that they have a job waiting when their deployment is 
complete. But I am pleased to report that thousands upon 
thousands of employers like the three represented here today go 
well above and beyond the call of duty.
    Many employers voluntarily offer differential pay to their 
activated employees. These are payments that represent the 
difference in the wages they earn and what they would have 
earned. In addition, many continue to extend health benefits to 
the deployed employees and their family members. Beyond even 
this, we will hear how some employers take the extra step to 
show how much they appreciate the devotion of their employees.
    We are happy to have with us today two such corporate role 
models, including one from my home State of Georgia, and we 
welcome Dennis Donovan of the Home Depot, and Christine Bierman 
from Colt Safety, Fire and Rescue based in St. Louis, Missouri.
    I also understand the importance of reemploying veterans 
once back from their tour of duty and I welcome Lisa Nisenfeld 
from the Southwest Washington Workforce Development Council to 
speak to us today on the efforts that are done in that area.
    We in Congress must always be looking for more ways to 
foster the important relationship between reservists and 
employers. Numerous bills introduced in this Congress take 
different approaches to this end. I look forward to hearing 
from all of our witnesses today on the importance of the 
contribution they make to our Reserve and Guard.
    On a closing comment in my opening statement, I would just 
like to add that this morning, ironically, I spent 3 hours at 
Walter Reed Hospital with members of the 48th Brigade who are 
back from Iraq going through physical therapy and 
rehabilitation from the limbs they lost in defense of our 
country and in defense of freedom. Ironically, three of those I 
visited guardsmen from Georgia, all of whom talked of how proud 
they were to serve the country and how much they were looking 
forward to going back to their employers. Having no idea that I 
would be conducting this hearing this afternoon, two of them 
talked specifically about their employer and about how much 
their support had meant to their families while they were 
deployed in Iraq.
    This is the story we want to hear in the Congress. These 
are the companies we want to brag about today, and I thank all 
of our guests who are testifying on their behalf.
    I introduce the distinguished ranking member, Mrs. Murray.

                  Opening Statement of Senator Murray

    Senator Murray. Thank you very much, Mr. Chairman, and I 
want to thank you for hosting today's hearing on this really 
critically important issue to the men and women who are serving 
us in the Guard and Reserve.
    I want to start by saying that our Guard and Reserve 
members are playing an extremely important role for our country 
every day in Iraq, Afghanistan, now Louisiana and Mississippi, 
Alabama, communities across the United States. I want to take a 
moment here to thank all of them for their tremendous service.
    Guard and Reserve employment is an important issue that our 
committee must focus on. Although we have had some successes, 
it is clear that we are not providing our Guard and Reserve 
members all of the resources they need to access and maintain 
employment once they are separated from active duty.
    I want to extend a special thanks, as well, to our 
panelists who are here today. Lisa Nisenfeld, who is the 
Executive Director of the Southwest Washington Workforce 
Development Council, comes from my home State in Vancouver, WA. 
I was with her last week talking about these issues. I know 
from firsthand experience that Lisa is one of the workforce 
stars in our State, and under her leadership, workforce 
programs in the region have more than doubled their positive 
outcomes and, in fact, have become a key economic development 
resource for growing companies.
    Mr. Chairman, I have been working with Guard and Reserve 
members throughout my 13 years here in the U.S. Senate and I 
know the issues facing them have never been as severe as they 
are today. The system simply doesn't work well enough and is 
not adjusted for the up-tempo military model where our Guard 
and Reserve members make up 40 percent of our troops in Iraq. 
Guard and Reserve members are doing the jobs of active duty, 
but they are getting few of the benefits.
    One of the Guard members I recently talked to told me that 
the mindset of Guard members was that the VA was for their 
fathers, not for them. We have to cut through those kinds of 
misunderstandings and show our Guard and Reserve members what 
benefits they have earned and deserve.
    The return of so many OIF and OEF veterans has made 
veterans' employment assistance even more important. Since 
2001, we have had over a million troops serving us in Iraq and 
Afghanistan. Although the Department of Defense provides 
services for the active duty component, the Guard and Reserve 
face some major reintegration hurdles.
    Over the past 6 months, I have met with many of these 
veterans, especially our Guard and Reserve members in 
Washington State. Many of them have talked to me about the 
difficulty accessing employment assistance once they have been 
demobilized. Time and time again, I have sat down with veterans 
who tell me stories about struggling to get caught up at work 
after their deployment, about having difficulty getting 
education benefits, or they are struggling just to find a job 
to support their families when they return.
    I have to tell you, Mr. Chairman, those stories really 
frustrate me. Last week, in fact, I was with Lisa and we had 
three Guard members with us who returned last March and, not 
one of them have been employed yet, and it is 6 months after 
they have returned. They are now days away from losing their 
unemployment insurance.
    Other Guard members have spoken with me and tell me about 
getting behind at their jobs, or not knowing how and where to 
get the training they need. Others have told me that they have 
no idea that employment services were even available and that 
USERRA protected their rights to get back to their old jobs. 
Others have told me about employers who were nervous about 
hiring Guard members, since they might have medical issues 
caused by injuries or they may be deployed again in just a few 
months.
    One Guard member in a Senate Veterans' Affairs Committee 
hearing testified to us that he lost his business because SBA 
programs intended to help small business owners and the self-
employed didn't work with the realities of mobilization. I have 
also heard about the Transition Assistance Program, the TAP 
program, that it doesn't work well for the 2-week time frame 
Guard members are given to separate and it is too focused on 
the needs of traditional forces. A finding that we recently got 
from our May GAO report confirmed what I have heard on the 
ground out there.
    Now, often when people think of veterans' services, they 
often just think of the VA health care system. However, we need 
to let people know that there are a large amount of services 
that are available to our veterans for benefits and they 
include employment assistance. That means there are 
considerable resources available to help our veterans meet the 
employment challenges they face and I hope that in today's 
hearing, we will hear from our panelists about what is working, 
what is not, and where we need to make the changes necessary to 
improve these services.
    Last August, Mr. Chairman, at a Senate Veterans Affairs 
Committee hearing, General Lowenberg, who is the Adjutant 
General of the Washington National Guard, said that he felt 
many Department of Defense programs don't work for our Guard 
and Reserve members. He said that services provided by the 
Defense Department and the VA should be revised to fit the 
nature of a military now heavily dependent on Guard and Reserve 
members. The Department of Defense estimates, in fact, that 68 
percent of separating service members attended the full TAP 
seminars, but only 35 percent of our Guard and Reserve members 
attend.
    I hope we hear from our panelists today on what we can do 
to provide resources to help veterans and employers. I think it 
is clear that Congress needs to look at many programs and 
services, including interpersonal and life skills training, 
readjustment counseling, VA briefings and workshops that are 
presented before the members' active duty tour ends, and 
training sessions and workshops that continue for up to a year 
after Guard and Reserve members release from active duty.
    We have got to find some innovative ways of educating our 
veterans about the many Federal and State benefits to which 
they are entitled, along with the growing number of services 
that are provided by private, nonprofit public service 
organizations, and I want to hear the panel address how those 
and other services may or may not be working for traditional 
active duty members as well as for our Guard and Reserve 
members.
    We need to update our resources. The Cold War is over, yet 
we are holding on to programs that were built for veterans of 
that era. The Department of Defense, the VA, the Department of 
Labor, and others need to look at how we can get the right 
services to veterans today. We should provide improved services 
to our Guard and Reserve members after they have separated, 
whether it is 3 months or 6 months or a year later. We have to 
update the TAP program to work within the realities of what 
Guard and Reserve members are going through today.
    We should improve the Labor Vets program by expanding its 
outreach efforts with creative initiatives designed to improve 
employment and training services for our Guard and Reserve 
members. We should place a priority on identifying military 
occupations that require licenses or certification or 
credentials at the local, State, and national levels. And we 
should provide programs and funding that truly help our Guard 
and Reserve members who run small businesses or are self-
employed as they manage that transition.
    Mr. Chairman, I have said many times, I believe how we 
treat our veterans when they come home is an important 
indication of the character of our Nation. That is why I think 
it is important for this subcommittee to look for ways to make 
the transition to work and home life smoother and easier for 
our service members and for their families.
    So I hope that with today's hearing, we can hear about some 
of these current needs and improvements, but I want to end with 
just two final thoughts. I want everyone in this room to bear 
in mind the story of a young guardsman that I met in August. He 
is a father of three and he recently returned from Iraq. He 
lost his job. He can't get unemployment. He can't get the VA or 
the DOD doctors to figure out what is wrong with him, and he is 
currently getting food stamps to feed his family.
    Today, we are going to hear some success stories, and I 
applaud the employers who are doing the right thing. We so 
appreciate that and want you to continue. We want to do what we 
can to make that happen. But we also have to focus on a lot of 
these Guard and Reserve members who are falling through the 
cracks, just like this father I talked to.
    Second, I have heard for over a year that we did a better 
job of taking care of our Guard and Reserve members during and 
after the Gulf War. I have heard that from everywhere I go, and 
I know that was a war where our Guard and Reserve made up a 
smaller percentage of our troops in the Middle East and 
obviously it was a much shorter conflict. Helping our Guard and 
Reserve transition into civilian life is a fundamental cost of 
war, and the Service Members Occupational Conversion and 
Training Act was developed as a transitional tool designed to 
provide job training and employment to veterans discharged 
after August 1, 1990, the first Gulf War.
    Back then, I think we need to recognize, there was a lot 
stronger network that helped our Guard members with 
reintegration than there is today. So I hope to hear from our 
panelists today how we can best change that to provide our 
veterans today the services they need, deserves and have 
earned.
    Thank you very much, Mr. Chairman.
    Senator Isakson. Senator Roberts?

                  Opening Statement of Senator Roberts

    Senator Roberts. Thank you, Mr. Chairman. I would like to 
associate myself with your remarks and that of the 
distinguished ranking member. I want to thank you for holding 
the hearing, and I would ask permission that my entire 
statement be made a part of the record and I will very briefly 
summarize.
    Senator Isakson. Without objection.
    Senator Roberts. We have two of Kansas' largest employers, 
Sprint and Westar Energy, who have made the decision to further 
support their citizen soldiers by providing differential pay. I 
certainly want to bring that to the attention of the committee. 
We are very proud of them and we hope that they serve as an 
example.
    I would also point out that I think that Congressional 
action is needed to clarify the tax treatment of this important 
voluntary benefit. Here is the problem. Under a 36-year-old tax 
ruling, our military fighting from foreign operating bases are 
required to file quarterly tax returns and submit quarterly tax 
payments because IRS rules actually treat a guardsman or a 
reservist called up to active duty as a, quote, ``terminated 
employee.'' This ruling is outdated. It is unacceptable to our 
service members.
    If you stop and think a minute about anybody in the Reserve 
and Guard trying to stop the influx of the insurgency at the 
border in Anbar Province, or trying to stabilize, say, Falujah, 
they simply do not have time to sit down and fill out quarterly 
tax forms.
    I think that we need to take prompt action. Last year, we 
almost had the problem fixed. Unfortunately, during 
consideration of the 2005 Defense authorization bill, the 
prospective legislation was removed during conference due to 
objections with regard to an unrelated tax provision, so we got 
into yet another turf fight. We cannot allow this IRS ruling to 
stand.
    Earlier this year, three members of this committee, Senator 
Gregg, Senator Alexander, and myself joined together to 
introduce legislation to clarify the tax treatment for 
differential pay. We need to make sure that this voluntary 
benefit provided by employers who want to do the right thing 
does not inadvertently really create an additional tax 
reporting burden on our citizen soldiers. Adopting this bill 
will relieve that burden and send a message to both Guard and 
Reserve families and employers that Congress recognizes the 
importance of this voluntary benefit.
    Again, Mr. Chairman, thank you for holding this important 
hearing. I apologize for leaving, but as chairman of the 
Intelligence Committee, we have Porter Goss, who is to give his 
yearly report. The flak jacket that we were going to provide 
him is missing and I have to find it.
    [Laughter.]
    Senator Isakson. Senator Roberts, before you leave, I want 
to personally thank you for your leadership on the tax issue 
and associate myself with your remarks and your support for 
that change. You are exactly correct.
    [The prepared statement of Senator Roberts follows:]

                 Prepared Statement of Senator Roberts

    Mr. Chairman, thank you for holding this hearing to focus 
on the relationship between our Nation's employers and Members 
of the National Guard and Reserve. This important relationship 
is critical to the success of our armed services and vital to 
our national security.
    As I visit with employers at home in Kansas, and our men 
and women in uniform, I am encouraged by the positive news I 
hear about steps employers are taking to assist employees 
called to active duty. While Federal law sets out employment 
protections for guardsmen and reservists who are on active 
duty, I know that many employers are going above and beyond 
these requirements.
    One way they are doing this is by providing differential 
pay. Differential pay provides the difference in pay between 
active duty military pay and an employee's civilian pay. It is 
a voluntary benefit offered by employers to their employees who 
are members of the Guard and Reserve and who are called to 
active duty.
    Across the country, many employers recognize the value of 
their employees who serve in the National Guard and military 
Reserves. As a result, these employers, including two of 
Kansas' largest employers, Sprint and Westar Energy, have made 
the decision to further support their citizen soldiers by 
providing differential pay.
    This income is critical to many families who, faced with 
the loss of income because a wage-earner is called to active 
duty, now have greater financial security while their family 
member is deployed. It means the difference between paying the 
mortgage or car payment or struggling to make up the loss in 
income. It means that a guardsman or reservist can better focus 
on their mission without the added stress of wondering if their 
family is financially secure. However, Congressional action is 
needed to clarify the tax treatment of this important, 
voluntary benefit.
    Here is the problem: under a 36 year-old tax ruling, 
soldiers fighting from forward operating bases are required to 
file quarterly tax returns and submit quarterly tax payments 
because IRS rules treats a guardsman or reservist called up to 
active duty as a terminated employee. This ruling is outdated, 
unacceptable and an insult to our men and women in uniform. 
Prompt action is needed to correct this situation. Last year, 
we almost had the problem fixed. Unfortunately, during 
consideration of the 2005 defense authorization bill, the 
proscriptive legislation was removed during conference due to 
objections regarding an unrelated tax provision. We cannot 
allow this IRS ruling to stand.
    Earlier this year, three members of this committee, Senator 
Gregg, Senator Alexander, and myself, joined together to 
introduce legislation to clarify the tax treatment for 
differential pay. We need to make sure that this voluntary 
benefit, provided by employers who want to do the right thing, 
does not inadvertently create an additional tax reporting 
burden on our citizen soldiers. Adopting this bill will relieve 
that burden and send a message to both Guard and Reserve 
families and employers that Congress recognizes the importance 
of this voluntary benefit.
    Again Mr. Chairman, thank you for holding this important 
hearing to highlight the vital relationship between our citizen 
soldiers and their employers.

    Senator Isakson. Senator Burr?

                   Opening Statement of Senator Burr

    Senator Burr. Thank you, Mr. Chairman. Let me take this 
opportunity to welcome the panel. I had the opportunity this 
morning to spend time with Mr. Donovan and to get some insight 
as to the tremendous commitment that Home Depot makes. What we 
find is they are not alone. There are a lot of companies around 
the country that provide us the opportunity to tap into our 
Guard and Reserve at a time like this, where we do have very 
responsible corporate citizens, and where we don't. Hearings 
like this, Mr. Chairman, are very helpful to help us fix the 
system.
    I might also point out that the University of North 
Carolina at Chapel Hill leads a collaborative effort funded by 
Congress with other institutions around the country called 
Citizen Soldier to look specifically at the deployment of 
guardsmen and reservists from the time that they are notified 
of that deployment until the time that they get home. Rather 
than waiting for an after-action report by DOD to be done after 
an event, this is done in real time to try to evaluate how we 
can do it better the next time we deploy. I think that already 
some of the information that this collaborative agreement has 
produced is beneficial to the quality of lives to the family 
members and to the troops who are deployed.
    It is indeed an honor today, Mr. Chairman, to also 
introduce a constituent, Sergeant First Class Ronald Fry. 
Sergeant Fry has been a member of the North Carolina Guard 
since 1985. He was mobilized in September 2003 and deployed to 
Iraq for Operation Iraqi Freedom from February 2004 to December 
2004. He served as a platoon leader for a motorized infantry 
element during 10 months of combat operations in Tikrit, Bayjl 
and Najaf.
    In peacetime, Ron Fry has been directly responsible for 
mission execution, safety supervision, training, near- and 
long-term planning, and logistical operations of 40 personnel, 
four self-propelled howitzers, and a fire direction center. He 
has multiple military awards that he has won. Sergeant Fry was 
selected as the Brigade Non-Commissioned Officer of the Year in 
1990 and the Battalion Non-Commissioned Officer of the Year in 
1990, 1997, 1998, and a member of the Joint Counter Narcotics 
Task Force in 1990.
    Ron Fry works for Wachovia Bank in Charlotte, North 
Carolina. He has worked there since 1998. Wachovia, 
interestingly enough, Mr. Chairman, received the 2005 Secretary 
of Defense Freedom Award on October 15, 2005. Currently, Ron 
serves as a Portfolio Manager Associate for the Credit Products 
Group at Wachovia Securities and he manages the credit risk of 
a multibillion-dollar portfolio of the financial institution's 
clients. He is responsible for all senior debt underwriting for 
any new or existing clients in the portfolio.
    He received a B.A. in Business Administration in 1998 from 
Belmont Abbey College in Belmont, North Carolina, and is 
currently in the MBA program at Wake Forest University's 
Babcock School of Management, an institution that is close to 
my heart, Mr. Chairman, in it's Charlotte Master's program.
    Mr. Chairman, it is indeed an honor to introduce not only a 
good Wachovia employee and North Carolinian, but a brave 
American who has served his country well. I welcome you, Ron.
    Senator Isakson. Thank you very much, Senator Burr. We 
appreciate that.
    At this time I would like to ask unanimous consent that the 
statements of Senators Gregg and Kennedy appear in the record 
and that any other statements submitted may be submitted during 
the next 10 days and the record held open. Without objection, 
so ordered.
    [The prepared statement of Senator Gregg follows:]

                  Prepared Statement of Senator Gregg

    Today, I am pleased that the Chairman has called this 
important hearing and I would like to take a few moments to 
discuss a significant bill that will be discussed today, The 
Uniformed Services Differential Pay Protection Act.
    Sustained military operations in Afghanistan and Iraq have 
brought to light another example of how outdated and burdensome 
Government policies can punish generous employers. Employers 
that continue to pay their employees now on active duty in the 
uniformed services are experiencing tax and pension 
difficulties that are discouraging this pro-worker, patriotic 
gesture.
    Under current law, employers of reservists and guardsmen 
called up for active duty are required to treat them as if they 
are on a leave of absence under the Uniformed Services 
Employment and Reemployment Rights Act of 1994 (USERRA). The 
act does not require employers to pay reservists who are on 
active duty. But as I have pointed out, many employers pay the 
reservists the difference between their military stipends and 
their regular salaries. Some employers provide this 
``differential pay'' for up to 3 years. For employee 
convenience, many of these companies also allow deductions from 
the differential payment for contributions to their 401(k) 
retirement plans.
    The conflict arises, however, because a 1969 IRS Revenue 
Ruling considers the employment relationship terminated when 
active duty begins. This ruling prevents employers from 
treating the differential pay as wages for income tax purposes, 
resulting in unexpected tax bills at the end of the year for 
these military personnel. Further, the contributions made to 
the worker's retirement account potentially invalidate 
(disqualify) the employer's entire retirement plan which could 
make all amounts immediately taxable to plan participants and 
the employer.
    The Uniformed Services Differential Pay Protection Act that 
I have introduced amends the Internal Revenue Code to clarify 
that differential wage payments are to be treated as wages to 
current employees for income tax purposes and that retirement 
plan contributions are permissible. It defines ``differential 
wage payment'' as any employer payment to an individual serving 
on active duty in the uniformed services for more than 30 days 
which represents wages such individual would have received if 
such individual were performing services for the employer. The 
bill treats an individual receiving differential wage payments 
as an employee and treats differential wage payments as 
compensation for retirement plan purposes.
    In summary, the Uniformed Services Differential Pay 
Protection Act upholds the principle that employers should not 
be penalized for their generosity towards our Nation's 
reservists and members of the National Guard. Again, I thank 
the Chairman for bringing this issue to the attention of the 
committee during this hearing today.

    [The prepared statement of Senator Kennedy follows:]

                 Prepared Statement of Senator Kennedy

    I commend Chairman Isakson and Senator Murray for holding 
this important hearing. The longer the war in Iraq goes on, the 
greater the toll it places on members of the Guard, Reserves, 
and their employers.
    Before September 11th, the average number of reservists and 
guardsmen on active duty was 35,000. Today over 150,000 are on 
active duty around the world, with many on their second, third, 
or even fourth tours of duty.
    Their continuing deployments strain our troops and their 
families, but they also cause hardship for their employers. 
Large companies struggle to find ways to work around their 
absent employees, but for small businesses, the loss of an 
individual can mean the difference between survival and 
bankruptcy, and for doctors and lawyers, the time away may well 
mean that their practice no longer exists when they return from 
their deployment.
    But the greatest hardship falls on the members of the Guard 
and Reserves themselves and their families. In the current 
economy, continuing activations can be a severe hardship. When 
these men and women leave their civilian jobs behind, they 
often give up higher salaries and benefits too. Their families 
have to find other ways to meet mortgage payments, buy 
groceries, and care for their children without the benefit of 
their civilian salaries.
    To reduce this hardship, our laws provide that service 
members returning home are entitled to return to their old 
jobs, without losing their seniority or benefits. Most 
employers obey the law, and as a recent survey by the 
Department of Defense has found, many employers actually go 
above and beyond the law's requirements to help reservists and 
their families. We'll recognize some of these employers at 
today's hearing. Massachusetts protects the salaries of its 
State employees called up for duty in the armed forces by 
paying the difference between their civilian pay and their 
military pay.
    Raytheon, the largest employer in the State, does so 
indefinitely. It also continues employee health benefits, so 
that families don't have to change doctors while their loved 
one is away. Raytheon employees receive credit for their 
pensions while they are on duty.
    Hopefully, now that this issue is being raised, many more 
employers will follow the example of the companies here today, 
and many more soldiers who are bravely fighting in Iraq and 
Afghanistan or serving in other parts of the world will find 
their jobs waiting for them when they return.
    Too many soldiers, however, return to find that they've 
been replaced, or are being demoted to a lower-paying position 
or a job with less responsibility.
    We'll hear today from the Department of Defense, which 
provides support for over 800,000 members of our Guard and 
Reserve now on drilling duty. The Department has over 4,000 
volunteers, including 800 ombudsmen, across the country who 
answer questions and try to resolve workplace problems. In 
fiscal year 2004, over 1,400 service members had problems with 
their employers and filed complaints with the Department of 
Labor as well.
    When I first heard about these types of problems from 
Massachusetts reservists, they told me they were worried about 
their jobs when they returned. Their employers were frustrated 
when they left their jobs to serve our country, and they feared 
they would be punished for it--by being passed over for 
promotion, being moved to another position, or worst of all, 
being fired.
    I asked the Government Accountability Office to study what 
the Federal Government actually does to protect the rights of 
men and women in uniform, since it's not enough to have 
protective laws on the books. We also need to enforce them. The 
GAO report I'm releasing today shows that our Federal agencies 
need to do a better job. Servicemembers' rights are at risk of 
being mired in a bureaucracy that can't communicate with 
itself. The four agencies responsible for enforcing the rights 
of our reservists and National Guard members have separate 
tracking systems that are not only not electronic, but are also 
incompatible with each other. In some cases, GAO found that the 
same servicemembers' files were being opened and closed 
repeatedly--with some complaints taking nearly 2 years to 
resolve.
    GAO has a number of recommendations to address these 
problems, such as that one agency should be responsible for 
overseeing the complaint process from start to finish. We need 
to consider this option seriously and I look forward to working 
with my colleagues to tackle these challenges and provide the 
necessary oversight and assistance to these agencies.
    We need to do everything we can to protect the rights of 
our service members as they reenter the American workplace. 
These men and women have already made tremendous sacrifices, 
leaving behind not only their civilian jobs but also their 
homes, their families, and their communities. They are doing 
their duty with great skill and courage, and it's our job to be 
sure that the Federal Government does its duty too, so that no 
one in our volunteer military suffers on the job for serving 
their country on the battlefield.

    Senator Isakson. Now I will introduce three of our panel 
members and Senator Murray will introduce the fourth. You have 
just gotten a wonderful introduction, Sergeant Fry. We 
appreciate you being here today.
    Senator Murray. And I introduced Lisa in my opening 
remarks, so she is introduced to the committee.
    Senator Isakson. First, representing the views of the 
administration is Bobby Hollingsworth, Executive Director of 
the National Committee for Employer Support of the Guard and 
Reserve. Appointed by President Bush less than 2 months after 
September 11, 2001, Mr. Hollingsworth serves as an advisor to 
the Assistant Secretary of Defense for Reserve Affairs on all 
matters involving employer support programs for the Reserve 
components of the United States Armed Forces.
    Second, I am very pleased to welcome Mr. Dennis Donovan, 
Executive Vice President of the Home Depot. Mr. Donovan 
oversees human resources functions for the Atlanta company's 
more than 300,000 associates. In just the Iraq conflict alone, 
the Home Depot has catered to the needs of approximately 1,800 
associates who have been called to active duty.
    On a point of personal privilege, I have had the occasion 
over and over again to witness the commitment of the Home Depot 
Corporation in the hiring of veterans. This year, they have 
already hired 13,000. Last year, they hired 16,000. They are a 
national leader in seeking out members of the armed forces and 
our veterans to serve, and their unparalleled support of the 
military and the young men and women who fight on behalf of 
this country is appreciated tremendously by this Nation and by 
their families.
    Third, we welcome Christine Bierman, founder and CEO of 
Colt Safety, Incorporated, a small business from St. Louis, 
Missouri. A former teacher turned entrepreneur, she has 
supported two employees activated by Operation Noble Eagle and 
Operation Iraqi Freedom and we are delighted to welcome you 
here today. To all of our panelists, we appreciate the example 
that you set.
    I will now open our hearing and ask Mr. Hollingsworth if 
you would like to make the first statement. We would like for 
you to keep the statement within 5 minutes, if possible. If you 
go over a little bit, we will let you fudge.

STATEMENTS OF BOBBY HOLLINGSWORTH, EXECUTIVE DIRECTOR, NATIONAL 
   COMMITTEE FOR EMPLOYER SUPPORT OF THE GUARD AND RESERVE, 
WASHINGTON, DC; DENNIS DONOVAN, EXECUTIVE VICE PRESIDENT, HUMAN 
 RESOURCES, HOME DEPOT, INC., ATLANTA, GA; CHRISTINE BIERMAN, 
  CHIEF EXECUTIVE OFFICER, COLT SAFETY, FIRE AND RESCUE, ST. 
   LOUIS, MO; LISA NISENFELD, EXECUTIVE DIRECTOR, SOUTHWEST 
 WASHINGTON WORKFORCE DEVELOPMENT COUNCIL, VANCOUVER, WA; AND 
    RONALD J. FRY, PORTFOLIO MANAGEMENT ASSOCIATE, WACHOVIA 
  CORPORATION, AND SERGEANT FIRST CLASS, NORTH CAROLINA ARMY 
                 NATIONAL GUARD, CHARLOTTE, NC

    Mr. Hollingsworth. Chairman Isakson, ranking member Murray, 
Senator Burr, and Senator Jeffords, it is indeed a privilege 
and we really thank you for the opportunity to come over and 
talk about the great things that are happening in America today 
for the members of the Guard and Reserve.
    Just in the past weekend, the Secretary of Defense 
recognized 15 employers nationwide by presenting them with the 
Employer Support Freedom Award, which is the Department of 
Defense's highest award recognizing employers for going above 
and beyond the requirements of the law to support their 
employees who serve our Nation's National Guard and Reserve.
    I am honored to be joined today by Dennis Donovan from the 
Home Depot and Christine Bierman from Colt Safety. Both of 
those were 2004 recipients of the Freedom Award. And, of 
course, I am also pleased to have Ronald Fry be here from 
Wachovia, who is a 2005 recipient. Lisa, it is great to be here 
with you, as well.
    The rigorous selection process for the Secretary of Defense 
Employer Support Freedom Award begins with the guardsman and 
reservists or a family member of a guardsman or reservist 
nominating their employer for this prestigious award. This 
year, I am pleased to report to you that we had over 1,500 
nominations for this award.
    In 1994, Congress passed the Uniformed Services Employment 
and Reemployment Rights Act, or USERRA, as it is more commonly 
known. It updated the 50-year-old Veterans Reemployment Rights 
Act to provide a broader range of protections to incorporate 
many court decisions that were relative to the VRR. USERRA 
prohibits discrimination in the basis of military service and 
established the conditions under which an employee may return 
to employment following active duty, active duty for training, 
or inactive duty for training.
    For guardsmen and reservists to continue to serve knowing 
his or her civilian employment is protected by law is extremely 
important. Knowing that his or her employment supports his or 
her service to guarantee our national security is equally 
important.
    Employer Support of the Guard and Reserve is a Department 
of Defense organization, as you mentioned earlier, that is 
responsible for gaining and maintaining support from all public 
and private employment for the men and women of the National 
Guard. Through an aggressive employer outreach effort, we 
educate and inform employers of their responsibilities under 
USERRA and encourage them to go above and beyond to support 
their employees serving in the Guard and Reserve.
    We recognize that there are employers within the private 
and public sectors that cannot provide differential pay or 
health benefits because of public policy or fiscal or economic 
constraints. Going above and beyond is not limited to 
differential pay or continuation of health benefits. There are 
many things that an employer can do that carry little or no 
price tag, and in many cases, these little things are every bit 
as meaningful, if not more so, to the employees serving in the 
Guard and Reserve.
    For example, Army Reserve Lieutenant Chad Souers from 
Northport, Alabama, sat down at a computer in Tikrit, Iraq, to 
nominate his employer for the 2004 Freedom Award. He 
acknowledged that his employer, which was Wal-Mart, provided 
differential pay and paid his portion of the civilian health 
insurance, but elaborated on Wal-Mart's personal touches. His 
boss, which is Mr. Fred Twilley, made regular phone calls to 
Lieutenant Souers' wife to ensure that she and their infant 
daughter were coping with his absence. Mr. Twilley and 
Lieutenant Souers' Wal-Mart associates invited Mrs. Souers to 
their store on their wedding anniversary for a surprise 
anniversary party. Lieutenant Souers' Wal-Mart associates sent 
flowers to Mrs. Souers on Valentine's Day and on Mother's Day 
to help with the pain of separation on these important days. 
Lieutenant Souers says, and I quote, ``They have repeatedly 
gone out of their way to include my wife and my daughter in the 
Wal-Mart family during my absence, only as dear friends could. 
All of this has given me the peace of mind when I needed it the 
most, knowing that there were so many people looking after my 
loved ones when I was unable to.''
    In Las Vegas, the Metropolitan Police Department is a 
public sector agency that goes above and beyond in supporting 
its employees of the Guard and Reserve. Sheriff Bill Young has 
assigned a family support coordinator to each of the 
department's area commands to maintain contact with the 
families of the deployed guardsmen and reservists. Not only do 
his area commanders maintain e-mail contact with the deployed 
soldiers and airmen and marines and other service members, but 
they do so with--also, the members of the employee's squad.
    The Las Vegas Metropolitan Police Department has instituted 
a leave donation policy allowing an employee to donate unused 
leave so that the guardsmen and reservists may have extra paid 
leave when they return from mobilization. To their credit, 
quotes Captain Gabriela Hatfield-Cook, ``the officers and 
employees of the Las Vegas Metropolitan Police Department stand 
behind their deployed comrades without reservation.''
    In another situation, Coast Guard Reserves Chief Warrant 
Officer Norm Chapman from Olympia, WA, has been a reservist the 
entire 18 years he has been employed by the South Puget Sound 
Community College. While South Puget Sound Community College is 
unable to provide differential pay, Mr. Chapman notes that the 
college grants veterans preferential credit points for most 
positions, they provide recognition of Guard and Reserve 
service through various college-wide activities, and upon 
several occasions, the school's automotive department made 
repairs to his family's vehicle, reducing the stress on his 
wife during mobilization. Not only did the college's public 
relations department publish stories about his experiences on 
active duty, but they ensured that he was informed about the 
news from the college so that when he was away, which enabled 
him to return to work with some knowledge of what was happening 
in his absence.
    Mr. Chapman said, quote, ``After the events of September 
11, a few of us employees have been called up more than once 
and I have heard nothing but positive words of encouragement 
from the administrative team. I feel totally confident that my 
job and position is fully protected by my employer and that 
they truly care about my Reserve participation.''
    Lieutenant General Steve Blum, the Chief of the National 
Guard Bureau, frequently says that we recruit the soldier, but 
we retain the family. In order for an employee to feel secure 
in continuing to serve in the National Guard and Reserve, not 
only must he or she be confident that they will return to their 
job and face no penalty for their service, but also that his or 
her employer supports their service to our national security. 
The Department of Defense recognizes that we share almost half 
of our workforce with America's employers, and those employers 
share sacrifices of the guardsmen and reservists. On behalf of 
a grateful Nation, the Department of Defense thanks these 
employers.
    If National Guardsmen and Reservists are indeed twice the 
citizen, then their civilian employers are twice the patriot. 
America's employers are inextricably linked to our Nation's 
security.
    Thank you, and I am looking forward to answering any 
questions you may have.
    Senator Isakson. Thank you, Mr. Hollingsworth.
    [The prepared statement of Mr. Hollingsworth follows:]
               Prepared Statement of Bobby Hollingsworth
    Mr. Chairman and members of the subcommittee, thank you for the 
opportunity to testify today on the importance of employer support for 
the Members of the National Guard and Reserve.
    This past weekend, the Secretary of Defense recognized 15 employers 
nationwide by presenting them with the Employer Support Freedom Award, 
the Department of Defense's highest honor recognizing employers for 
going ``above and beyond'' the requirements of law to support their 
employees who serve our Nation in the National Guard and Reserve. I am 
honored to be joined here today by Dennis Donovan of Home Depot and 
Christine Bierman of Colt Safety, Fire and Rescue. Both firms are 2004 
recipients of the Freedom Award. The rigorous selection process for the 
Freedom Award begins with a member of the Guard or Reserve, or a family 
member of a guardsman or reservist, nominating the employer for the 
award. I am pleased to report to you that we had over 1,500 nominations 
for the 2005 Freedom Awards.
    In 1994, Congress passed the Uniformed Services Employment and 
Reemployment Rights Act, or USERRA as it is more commonly known. It 
updated the 50 year-old Veterans' Reemployment Rights (VRR) Act, to 
provide a broader range of protections and incorporate many court 
decisions relative to VRR. USERRA prohibits discrimination on the basis 
of military service and establishes the conditions under which an 
employee may return to employment following Active Duty, for Training, 
or Inactive Duty for Training. For a guardsman or reservist to continue 
to serve, knowing his or her civilian employment is protected by law is 
extremely important. Knowing that his or her employer supports his or 
her service to guarantee our national security is equally important.
    Employer Support of the Guard and Reserve is the Department of 
Defense organization responsible for gaining and maintaining support 
from all public and private employers for the men and women of the 
National Guard and Reserve. Through an aggressive employer outreach 
effort, we educate and inform employers on their responsibilities under 
USERRA and encourage them to go ``above and beyond'' to support their 
employees serving in the National Guard and Reserve.
    We recognize that there are employers within the private and public 
sectors that cannot provide differential pay or health benefits because 
of public policy or economic constraints. Going ``above and beyond'' is 
not limited to differential pay or continuation of health benefits. 
There are many things an employer can do that carry little or no price 
tag, and in many cases, these ``little things'' are every bit as 
meaningful, if not more so, to the employee serving in the Guard and 
Reserve.
    Army Reserve Lieutenant Chad Souers of Northport, Alabama, sat down 
at a computer in Tikrit, Iraq, to nominate his employer for a 2004 
Freedom Award. He acknowledged that his employer, Wal-Mart, provided 
differential pay and paid his portion of his civilian health insurance, 
but elaborated on Wal-Mart's personal touches. His boss, Fred Twilley, 
made regular phone calls to Lieutenant Souers' wife to ensure that she 
and their infant daughter were coping with his absence. Mr. Twilley and 
Lieutenant Souers' Wal-Mart associates invited Mrs. Souers to the store 
on their wedding anniversary for a surprise anniversary party. 
Lieutenant Souers' Wal-Mart associates sent flowers to Mrs. Souers on 
Valentine's Day and Mothers' Day to help with the pain of separation on 
those important days. Lieutenant Souers said, ``They have repeatedly 
gone out of their way to include my wife and daughter in the Wal-Mart 
family during my absence as only dear friends could. All of this has 
given me the peace of mind when I needed it the most, knowing that 
there were so many people looking after my loved ones when I was unable 
to.''
    The Las Vegas Metropolitan Police Department is a public sector 
agency that goes ``above and beyond'' in supporting its employees who 
serve in the Guard and Reserve. Sheriff Bill Young has assigned a 
family support coordinator within each of the department's area 
commands to maintain contact with the families of deployed guardsmen 
and reservists. Not only do his area commanders maintain e-mail contact 
with deployed employees, but so do the members of the deployed 
employee's squad. The Las Vegas Metropolitan Police Department 
instituted a leave donation policy allowing any employee to donate 
unused leave so that guardsmen and reservists may have extra paid leave 
when they return from mobilization. Army Reserve Captain Gabriela 
Hatfield-Cook said, ``To their great credit, the officers and employees 
of the Las Vegas Metro Police Department stand behind their deployed 
comrades without reservation.''
    Coast Guard Reserve Chief Warrant Officer Norm Chapman of Olympia, 
Washington has been a reservist the entire 18 years he has worked for 
the South Puget Sound Community College. While South Puget Sound 
Community College is unable to provide differential pay, Mr. Chapman 
notes that the college grants veterans preference credit points for 
most positions, provides recognition of Guard and Reserve service 
through various college-wide activities, and upon several occasions, 
the school's automotive department made repairs to his family's 
vehicle, reducing the stress on his wife during the mobilization. Not 
only did the college's public relations department publish stories 
about his experiences on active duty, they ensured he was informed 
about news from the college while he was away, enabling him to return 
to work with some knowledge of what had happened during his absence. 
Mr. Chapman said, ``After the events of September 11th, a few of us 
employees have been called up more than once, and I have heard nothing 
but positive words of encouragement from the administrative team. I 
feel totally confident that my job and position is fully protected by 
my employer and that they truly care about my Reserve participation.''
    Lieutenant General Steve Blum, Chief of the National Guard Bureau, 
frequently says that we recruit the soldier but retain the family. In 
order for an employee to feel secure in continuing to serve in the 
National Guard or Reserve, not only must he or she be confident that 
they will return to their job and face no penalty for their service, 
but also that his or her employer supports their service to our 
national security. The Department of Defense recognizes that we share 
almost half of our workforce with America's employers, and these 
employers share the sacrifices of our guardsmen and reservists. On 
behalf of a grateful Nation, the Department of Defense thanks these 
employers.
    If National Guardsmen and Reservists are indeed ``twice the 
citizen,'' then their civilian employers are ``twice the patriot.'' 
America's employers are inextricably linked to our Nation's security.
    Thank you, and I will be happy to answer your questions.

    Senator Isakson. Mr. Donovan?
    Mr. Donovan. Good afternoon. I would like to start out by 
thanking Chairman Isakson and Senator Murray for inviting the 
Home Depot to participate in this subcommittee hearing.
    The Home Depot was founded just in 1978. We are the world's 
largest home improvement specialty retailer, the second-largest 
retailer in the United States. We currently employ more than 
325,000 associates. Home Depot operates more than 1,950 stores 
in all 50 States, the District of Columbia, Puerto Rico, 10 
Canadian provinces, and Mexico. Our headquarters are in 
Atlanta, Georgia, and we are proud to call the chairman of this 
committee our Senator.
    At the Home Depot, we take our support for the military 
very, very seriously. One of our core values at the Home Depot 
is taking care of our people. Since 2002, the Home Depot has 
had approximately 1,800 associates called to active duty for 
the current conflict. Beyond assuring that these associates 
have a good job when they return home, the company also 
implemented an extended and enhanced leave of absence benefit. 
The Home Depot equalizes pay between their military salary and 
their Home Depot compensation and we extend health benefits to 
deployed associates as well as their family members.
    Our company's support of the military goes beyond our 
deployed associates. In September of 2004, the Home Depot 
joined forces with the U.S. Departments of Defense, Labor, and 
Veterans' Affairs to launch Operation Career Front. This is an 
unprecedented program to provide job opportunities for 
veterans, separating active duty service members, National 
Guard, Reserves, and military spouses.
    In 2003, the Home Depot hired 10,000 veterans. In 2004, the 
company hired more than 16,000 former military personnel, and I 
am proud to say that we expect to surpass this number in 2005, 
since we have already hired 13,000 veterans through September 
of this year.
    Home Depot has also hired a significant number of former 
junior military officers into our Store Leadership Program. 
Since 2002, we have hired a total of 1,147 people into this 
program. Five-hundred-and-twenty-nine of them are former junior 
military officers. And out of that number, 125 of the JMOs are 
academy graduates.
    The company also participates in the Marine Corps' National 
Fellows Program. This is a 1 year rotation inside of the Home 
Depot where the Marine works very closely with the senior 
leadership team of the company. Lieutenant Colonel Jim Izen, 
who is here with me today, is our fourth Marine fellow.
    The Home Depot also collaborates with the military to share 
best practices. We are hosting the Army's Strategic Leadership 
Program for the third time on November 16. The focus will be on 
leadership, information technology, supply chain, and 
logistics.
    Another one of the core values at the Home Depot is giving 
back to the community, and we do this through donations and 
volunteerism. Giving back to the military community is 
certainly part of this. In April of 2003, we launched Project 
Homefront. While they were protecting our homeland, we wanted 
to protect their homefront. This program was designed to help 
military families with home repairs while their loved ones were 
deployed. The Home Depot donated a million dollars and a 
million hours of volunteerism to help out during 2003 and 2005, 
and to date, we have repaired over 1,000 homes.
    In addition, in July of 2004, the company donated $1 
million in tools and materials to support the U.S. military 
efforts in Iraq.
    I would like to close by saying that we view our support 
for the military as our responsibility to our country. We don't 
view this as a cost. We consider this as a valuable investment 
to our company's future. Again, this is something we take very 
seriously and we will continue to support those who are 
defending our rights and protecting our freedoms.
    Chairman Isakson, Senator Murray, thank you again for 
inviting the Home Depot to be here today.
    Senator Isakson. Thank you, Mr. Donovan.
    [The prepared statement of Mr. Donovan follows:]
                  Prepared Statement of Dennis Donovan
    Good afternoon. My name is Dennis Donovan, and I am the Executive 
Vice President of Human Resources for The Home Depot, Inc.
    I would like to thank Chairman Isakson and Senator Murray for 
inviting The Home Depot to participate in this subcommittee's hearing 
on cooperation between employers and guardsmen/reservists.
    Founded in 1978, The Home Depot is the world's largest home 
improvement specialty retailer and the second largest retailer in the 
United States, with fiscal 2004 sales of $73.1 billion. The company 
employs approximately 325,000 associates and has more than 1,950 stores 
in all 50 States, the District of Columbia, Puerto Rico, 10 Canadian 
provinces and Mexico. Headquartered in Atlanta, Georgia, we're 
extremely proud to call the chairman of this subcommittee our Senator.
    At The Home Depot, we feel that our support of the military sets 
the standard for corporate America. It is our belief that we must honor 
our military heroes where it matters most, not only in our thoughts and 
prayers, but also in our business practices, human resource policies, 
corporate giving and volunteer efforts. It is in our value proposition 
to take care of the people who are defending our country. We do not 
view our military support as a cost, but rather as an investment. It is 
not a burden. It is our responsibility, and one that we live up to 
proudly each and every day.
    The Home Depot's commitment to the men and women who serve our 
country is unquestionably strong and very close to the heart. Since 
2002, The Home Depot has had approximately 1,800 associates called to 
active duty for the current Iraqi conflict.
    The Home Depot has implemented an extended and enhanced leave of 
absence benefit for our deployed associates. Beyond making sure these 
associates have a good job when they return home, The Home Depot 
equalizes pay between their military salary and what they would have 
made at The Home Depot as well as extends health benefits to all of our 
deployed associates and members of their families.
    We feel it is important to take care of our associates while they 
are away protecting our freedoms, so the company has extended these 
benefits to our associates for the duration of the Iraqi conflict. It 
is extremely important to us that these men and women are given the 
opportunity to continue receiving their benefits and have their pay 
equalized if their military position pays them less then what they 
would be earning if they were not a reservist or guardsman. These 
individuals should not have to forgo benefits or income because of 
their decision to defend our Nation.
    Our company's support of the U.S. military and the men and women 
serving our country goes far beyond what we offer our own deployed 
associates. The Home Depot has been a long-time proponent of hiring 
separating military, veterans and military spouses.
    On September 21, 2004, The Home Depot joined forces with the U.S. 
Departments of Defense, Labor, and Veterans Affairs to launch Operation 
Career Front, an unprecedented program designed to provide career 
opportunities for America's military personnel who are interested in 
transferring their unique skills, knowledge and abilities into a 
successful second career.
    I was in Washington, D.C. with Bob Nardelli, our Chairman, 
President and CEO; Elaine L. Chao, the Secretary of Labor; Dr. David 
S.C. Chu, the Under Secretary of Defense for Personnel and Readiness of 
U.S. Department of Defense; and Anthony J. Principi, the former 
Secretary of Veterans Affairs to launch this tremendous initiative.
    In addition to providing employment opportunities for active, 
Reserve, National Guard or veterans, The Home Depot also has a program 
for military spouses and dependents. With our network of stores 
throughout the country, The Home Depot works with its military 
associates to provide transfers in the cases of reassignment of duty 
stations, retirement or separation.
    Operation Career Front is a program that enhances the company's 
hiring efforts within the military community. In 2003, The Home Depot 
hired 10,000 veterans, and in 2004 the company hired more than 16,000 
former military personnel. I could not be more proud to tell you that 
we plan to exceed that number in 2005 as we already have hired more 
than 13,000 veterans through September.
    Our effort, Operation Career Front, supports America's military job 
seekers, including veterans, separating active duty service members, 
National Guard members, Reserves and military spouses.
    To support the initiative, the U.S. Department of Defense provides 
a link on its Web site to enable military members and their families to 
apply for employment with The Home Depot, and it lists The Home Depot 
as a prospective employer on its job search Web site. The U.S. 
Department of Defense also makes information available to interested 
military personnel and their families outlining the process to apply 
for careers with The Home Depot through their Military Transition 
Assistance and Family Centers.
    The U.S. Department of Labor makes Operation Career Front 
information available to more than 2,000 One-Stop Career Centers 
throughout the Nation. The U.S. Department of Labor also supports the 
initiative utilizing the Local Veterans Employment Representatives 
(LVERs) as well as Disabled Veteran Opportunity Program (DVOP) 
specialists located at One-Stops and Transition Assistance Centers 
across the Nation.
    The U.S. Veterans Affairs Department's Vocational Rehabilitation 
and Employment (VA VR&E) division makes Operation Career Front 
information available to veterans with service-connected disabilities 
through its representatives located in State offices across the Nation.
    The Home Depot has also hired a significant number of former 
military into our Store Leadership Program. The Store Leadership 
Program provides individuals who are dynamic and driven with a strong 
foundation of strategic and technical skills, placing them on the fast 
track to store manager positions.
    Since the inception of the program in 2002, the company has 
enrolled 1,147 individuals. Of those enrolled, 529 of them are former 
junior military officers, with 125 of the JMO's being Academy 
graduates.
    The Home Depot is always looking for the best, brightest talent 
available, and we have found that the former junior military officers 
that have joined our company possess tremendous leadership 
characteristics that have made them invaluable hires. We have found 
that these men and women have transferable experience because they have 
been put in a position where they have had to deliver results, and 
where they must act strategically as well as tactically.
    In addition, our experience shows us that junior military officers 
have the ability to drive excellence and lead through inspiration. 
Also, they have the self-confidence and the know-how to engage 
customers.
    The company also is a participant in the Marine Corps Corporate 
Fellows Program. For the past several years, an officer from the U.S. 
Marine Corps has been assigned to The Home Depot for a 1-year rotation 
working closely with the company's senior leadership team. The company 
benefits from the military leader's experience, and the officer is able 
to transfer his or her learnings at The Home Depot back to the Marines. 
We are proud to say we have our fourth Marine Corp Fellow, Lt. Col. Jim 
Izen, currently at The Home Depot.
    The company also collaborates with the military to share best 
business practices. On November 16, 2005, The Home Depot is scheduled 
to host the Army Strategic Leadership Program for the third time. More 
than 25 senior officers and personnel will be in Atlanta to meet with 
Bob Nardelli and the members of the Senior Leadership Team to discuss 
and share ideas around leadership, logistics, information technology 
and supply chain management. On November 18, I am slated to meet with 
officers and personnel from the Air Force to share best practices.
    Taking care of our communities through corporate philanthropy and 
volunteerism is one of the company's core values. Our commitment to the 
military community is no exception.
    In 2003, we launched Project Homefront, a program designed to help 
military families with home repairs while their loved ones were away 
serving on active duty. The company pledged $1 million and 1 million 
volunteer hours from our associates to complete these home repairs 
during 2003 and 2004.
    In July 2004, The Home Depot donated $1 million in tools and 
materials to support U.S. military efforts in Iraq. Nearly 100,000 
tools and materials, including shovels, table saws, concrete mixers, 
safety scaffolding, power generators, light bulbs, jackhammers, and 
thousands of letters from associates at The Home Depot to troops were 
loaded on nine tractor-trailers in San Diego and taken by the U.S. Army 
and U.S. Marine Corps transportation to U.S. military installations in 
Iraq.
    The Home Depot's support of the military has not gone unnoticed as 
the company has received numerous awards and recognition for our 
efforts and initiatives. The company received the Employer Support of 
the Guard and Reserve's Freedom Award in 2004 and The Home Depot was 
the recipient of the Employer Support of the Guard and Reserve's 
Homefront Award in 2003.
    In addition, The Home Depot received the No. 1 Ranking in the ``Top 
10 Employers for Military Personnel'' by G.I. Jobs magazine in November 
2004.
    In June 2005, Bob Nardelli received the Most Distinguished American 
Award from the Marine Corps Law Enforcement Foundation.
    Recently, the company received the 2005 Veterans of Foreign Wars 
James R. Van Zandt Citizenship Award, a commendation from The American 
Legion, the USO (United Service Organizations) Patriot Award, the PSC 
Private Sector Leadership Award for the Partnership for Public Service, 
and the Military Officers Association of America's Distinguished 
Service Award.
    I would like to close by saying we view our support of the military 
as our responsibility to our country and as a valuable investment in 
our company's future. It is something we take very seriously at The 
Home Depot, and we will continue to support those who are defending our 
rights and protecting our freedoms.
    Chairman Isakson, Senator Murray, thank you again for inviting The 
Home Depot to participate in this Senate subcommittee hearing.

    Senator Isakson. Ms. Bierman?
    Ms. Bierman. Mr. Chairman, members of the committee, and 
distinguished guests, as a citizen of this great Nation, I am 
honored to testify before you today and trust that my ideas and 
opinions will be considered as we work together to continually 
improve the way we do business in Government and in the public 
and private sector.
    My name is Christine Bierman, CEO and founder of Colt 
Safety, Fire and Rescue, located in St. Louis, MO. Colt Safety 
is a small, woman business enterprise celebrating our 25-year 
anniversary this year. We warehouse and distribute personal 
protective equipment and industrial safety supplies. I am a 
national founding partner of Women Impacting Public Policy, a 
longtime member of NAWBO, National Association of Women 
Business Owners, and WBENC, Women Business Enterprise National 
Council, and a longtime member of the American Society of 
Safety Engineers.
    Our company's mission is to protect the American workforce. 
Our vision is to nurture a successful company, poised to give 
back to our family of employees and to the community.
    After the devastation to our Nation and our psyche as we 
watched the World Trade Towers vanish before our eyes on 
September 11, how could any American not step up to the plate 
and protect and defend this great Nation and to support any and 
all efforts to that end?
    Colt Safety had 2 of our 17 employees activated after 
September 11. That represents 20 percent of our entire 
workforce. Master Sergeant Jim Mixco, United States Air Force 
reservist and 9 year Colt Safety employee, was called to action 
to support Operation Noble Eagle shortly after those towers 
crumbled. My heart and my patriotic duty, and the fact that Jim 
was a longtime manager at our company, guided me to continue 
his full salary and benefits for the year he was activated.
    Another employee, Specialist Joey Petry from the 203rd 
Battalion, Fort Leonard Wood, was deployed directly to Baghdad 
during our company's busiest season.
    Only after our company received the ESGR Freedom Award and 
the Government went out of its way to thank us with Waterford 
crystal eagles and Boss lifts to military bases across the 
country did I learn that not all employers do what I felt in my 
heart was the right thing.
    I was moved by soldiers at Fort Benning, GA, who thanked us 
from the bottom of their hearts for supporting them in their 
efforts to protect us. Over the past year, soldiers have either 
been given my name or found us online, contacted me, asking us 
for advice on how to help them set up programs at their own 
companies. It is my hope that Colt Safety can serve as a role 
model to other companies that endeavor to do the right thing 
for our Guard and Reserve.
    Former Secretary Wolfowitz said to me as he was handing me 
that beautiful crystal eagle that he knew it was easier to do 
if you are American Express. He understood the financial impact 
on a company our size. I do believe I am the smallest company 
ever to win this award. I think I am the only woman-owned 
business. And until last Saturday night, I was the first 
Missouri company to ever win until Enterprise Rent-a-Car just 
won.
    Colt Safety's revenue was directly impacted by 50 percent 
decrease in profits and sales during Jim's absence. Small 
businesses that extend themselves financially in support of our 
Guard and Reserve must be recognized not only with crystal 
eagles and conspicuous service medal awards, but also with 
Government contracting opportunities. Colt Safety and other 
small diversity companies can only continue to do the good that 
we do that is documented in this testimony when we are afforded 
opportunities to do business with the largest procurement 
agency in the world, the United States Government.
    I am asking you today to author a bill that supports by way 
of Government contracts those small businesses, and large 
businesses, of course, that support our President and our 
service men and women. This will encourage and afford others 
the financial stability to do the right thing.
    Thank you for the opportunity to testify today and I will 
answer any questions.
    Senator Isakson. Thank you, Ms. Bierman.
    [The prepared statement of Ms. Bierman follows:]
                Prepared Statement of Christine Bierman
    Mr. Chairman, members of the committee, distinguished guests. As a 
citizen of this great Nation I am honored by the invitation to testify 
before you today and trust that my ideas and opinions will be 
considered as we work to continually improve the way we do business in 
Government and in the public and private sectors.
    My name is Christine Bierman, CEO and Founder of Colt Safety, Fire 
& Rescue located in St. Louis, MO. Colt Safety is a small, woman 
business enterprise celebrating our 25 year anniversary milestone this 
year.
    Colt Safety warehouses and distributes Personal Protective 
Equipment (PPE) and industrial SAFETY Supplies, everything a worker 
wears or uses in a hazardous environment according to OSHA and NFPA 
regulations.
    I am an advocate for small and diversity businesses and have had 
the honor of testifying before local, State and Federal committees many 
times regarding small business and OSHA regulatory issues over the past 
20 years. I am a National Founding Partner of Women Impacting Public 
Policy (WIPP), a long-time member of National Association of Women 
Business Owners (NAWBO), a member of Women Business Enterprise National 
Council (WBENC) and the American Society of Safety Engineers (ASSE).
    Our Company's Mission is to profitably meet the safety and hygiene 
needs of the American workforce. Our VISION is to strategically and 
profitably nurture a successful company poised to give back to its 
family of employees and the community. After the devastation to our 
Nation and our psyche as we watched the World Trade Towers vanish 
before our eyes on September 11, 2001, how could any American not step 
up to the plate to protect and defend this great Nation and to support 
any and all efforts to that end.
    Colt Safety had 2 of our 17 employees activated after September 11. 
That represents 20 percent of our entire work force.
    Master Sgt. Jim Mixco USAF reservist, 9 year Colt Safety employee 
and Director of all Technical Sales and Service at Colt was called to 
action to support Operation Noble Eagle shortly after those towers 
vanished. Jim would serve at Scott Air Force Base, IL which is 40 miles 
East of our offices in St. Louis, MO. His duty would be 24 hours on and 
24 hours off.
    My heart and my patriotic duty and the fact that Jim was a long-
time employee and responsible for a complete department at Colt Safety 
led me to choose to continue his full salary and benefits for the 
complete year that he was activated. Then Jim's annual 3 week tour of 
duty had long been scheduled for March of 2003. Jim's unit was deployed 
to Saudi Arabia as the President presented ultimatums and deadlines to 
Saddam Hussein.
    Needless to say tensions and emotions ran high while Jim was in the 
Middle East and terrorist threats and attacks began to escalate.
    I was in continual contact with Jim's wife and frightened children. 
Jim e-mailed us periodically from Saudi. I replied that I was worried 
for his family and we should do something for his wife. He and I 
concocted a plan that I would purchase a gift certificate for a massage 
at a Day Spa for his wife and put it in a card and sign it from Jim. 
When I presented that gift to her on behalf of Jim . . . she cried.
    Another employee SPC Joey Petry from the 203d BN Ft Leonard Wood, 
an hourly warehouse person was deployed directly to Bagdad after the 
President declared war on Saddam Hussein and during our company's 
busiest season. Joey's tour of duty was extended 2 times and lasted 16 
months. Joey returned to his position at Colt until he chose to leave 
us and go back to college full time.
    In October 2004, our Company received the Secretary of Defense ESGR 
FREEDOM Award. It was then after the Government went out of its way to 
thank us with Waterford Crystal Eagles and Boss Lifts to military bases 
across the country did I begin to learn that not all employers do what 
I felt in my heart to be ``the right thing.''
    I was in awe of the Soldiers at Ft. Benning, GA who thanked us 
BOSSES from the bottom of their hearts for supporting them in their 
efforts to protect us. At first blush it seemed that they were 
following orders as they thanked us for supporting the Guard and 
Reserve. It was not long into the 3 day visit that I realized that 
these thank you words were truly sincere and coming from the depths of 
their hearts. I was very moved by this!
    I heard stories on that trip to Ft. Benning from soldiers, other 
bosses and reporters that . . . what a handful of us were doing for our 
activated employees was the exception and not the rule.
    Just 2 weeks ago a banker came to my office and noticed our Freedom 
Award. He told me his horror story of his most recent activation. He 
said that by law his former bank had to give him a job upon his return. 
All of his previous clients were given to someone else and he would 
have to find new clients or be out of a job. He stayed at that bank for 
45 days before he sought friendlier employment.
    Over the past year, soldiers have either been given my name or 
found us online and have called for advice on setting up procedures at 
their companies. It is my hope that Colt Safety can serve as a role 
model to other companies in their endeavors to do the right thing for 
our Guard and Reserve.
    With all of this said, I know that we at Colt Safety have always 
done the right thing. We have been a powerful and vocal advocate for 
supporting our Guard and Reserve.
    Secretary Wolfowitz said to me on stage as he was handing me that 
beautiful Waterford Crystal Eagle, ``we know it is easier to do what 
you have done when you are American Express.'' He knew that we were 
probably the smallest business ever to receive this award and that it 
may not have been easy for us financially.
    Colt Safety's revenue was directly impacted by Jim's absence. His 
24 on 24 off schedule translates to less than 50 percent duty to Colt 
Safety. (This does NOT include his annual 3 week tour of duty which we 
have paid full salary and benefits also for the past 9 years). The 
sales generated in Jim's technical sales arena, (specifically sales of 
SCBA's, breathing apparatus, bunker gear and gas monitoring equipment 
to fire departments) were down 50 percent for the year Jim was serving 
under Operation Noble Eagle and Operation Iraqi Freedom.
    In order to continue the good that we and other companies like us 
do by going above and beyond the call of duty, we must continue to be 
viable businesses. My request of you today is that you recognize 
companies like mine, not only with crystal eagles and Conspicuous 
Service Medals, but also with Government contracting opportunities. 
Once the doors of commerce are open to small diversity companies, our 
Nation and its leaders will realize growth, quality services and 
prosperity beyond our wildest dreams.
    I am certain you are aware of the following facts so I will quickly 
brief you on them.
    Small business is the engine that drives our Nation's economy! 
Women business enterprises:

     Represent 38 percent of all majority-owned, privately held 
firms in the United States;
     Generate $3.7 trillion dollars in revenues to the U.S. 
economy;
     Are growing at twice the rate of all U.S. firms;
     Stay in business longer than all other businesses;
     WBE's generally employ a more gender-balanced workforce;
     Are more likely to offer flextime, tuition reimbursement 
and profit sharing;
     There are an estimated 1.2 million firms owned by women of 
color equaling 1 in 5 or 20 percent of all women owned firms;
     In the State of Missouri, Women-owned firms employ 217,000 
people;
     With annual sales approaching $25 billion;
     Yet Women business owners receive less than 2 percent of 
all Government contracting and Fortune Company dollars.

    All statistics are from the Center for Women's Business Research.
    Colt Safety is one small, woman business enterprise that can only 
continue to do the good documented in this testimony when we are 
afforded opportunities to do business with the largest procurement 
agency in the world, the U.S. Government.
    Thank you for the opportunity to testify before you today. I would 
be happy to answer any questions.

    Senator Isakson. Ms. Nisenfeld?
    Ms. Nisenfeld. Mr. Chairman and members of the 
subcommittee, thank you for the opportunity to talk with you 
today about employment issues for returning Reserve and 
National Guard soldiers.
    The efforts of many employers to assure continued 
employment for our returning National Guard and Reserve 
veterans in both the public and private sectors is truly 
outstanding. These organizations well deserve the Nation's 
recognition and thanks.
    Much more needs to be done, however, to make sure that all 
our returning National Guard and Reserve soldiers are employed 
and economically stable. The challenges facing these heroes are 
complex.
    Last spring, 700 Oregon National Guard soldiers returned 
home, many of them residents of Southwest Washington. Fully 40 
percent of them were unemployed upon return. Another group of 
700 is scheduled to return next month, and of these, at least 
30 percent anticipate being unemployed. An equal number, 
another 30 percent, describe themselves as underemployed. This 
occurs as our region's economy is in the midst of a strong 
recovery. So while the employment prospects for the public at 
large have improved, the options for our reentering service 
people are not as bright.
    In Washington State, citizen soldiers demobilized from the 
Washington National Guard's 81st Brigade, demonstrating a 40 
percent unemployment rate among 1,000 returnees. The largest 
number of these unemployed soldiers were jobless when they 
entered the Guard. That is especially true because we were in 
the midst of a recession at that time. To them, the challenges 
of securing gainful employment are even greater. They tend to 
be young people who have little, if any, college education. 
Some of them were students. Others were downsized during their 
period of service. The transition for these soldiers has been 
very, very difficult.
    Upon first returning to civilian life, they are provided 
with a substantial amount of information regarding employment 
and education resources in their communities. That information, 
however, often falls upon deaf ears because the soldiers aren't 
ready to jump into a job. They face many pressing issues--
reintroduction to their families, housing, deaths, and health 
challenges. So the usefulness of the information presented at 
demobilization is often limited.
    Further, those who worked low-wage, low-skilled jobs are no 
longer satisfied with that. During their deployment, they 
learned many technical skills, lived in intense and demanding 
situations. They developed a maturity unlike that of others 
their age. Their expectations for work and family change 
substantially, yet they often come home to minimum-wage jobs, 
debts, and challenging family situations. They may have 
physical and mental challenges, as well, resulting from their 
service. So they are given 3 weeks or less to decompress prior 
to entering civilian life.
    How can we help solve these challenges? There are a variety 
of possibilities. First, we should consider providing a 
military salary and benefits during the transitional years so 
individuals can afford to go to school. A wide variety of 
resources are out there to help pay the tuition and fees for 
veterans returning to school, yet many have young families and 
financial obligations which preclude full-time education. They 
simply can't afford the cost of living.
    Our economy needs these young people to pursue higher 
education and technical credentials, so this would be a sound 
investment.
    No. 2, encourage civilians and veterans' organizations to 
work together to reach out to returning soldiers. Congress has 
funded a comprehensive system of one-stop employment centers 
throughout the country. These centers consider returning 
veterans to be their top priority populations for services. For 
the most part, however, these programs are not connected 
directly to the various military organizations that are 
demobilizing soldiers. These programs stand ready to actively 
reach out to returning veterans as well as their dependents, 
yet most are mystified about who to call and how to connect. 
Our system regularly mobilizes resources to deal with large 
layoffs and plant closures. Surely, our experience in rapid 
response can be applied to working with these men and women.
    Making these connections is especially challenging for Army 
Reserve units, such as the 104th Division in Vancouver, because 
they draw soldiers from 12 States. They need to better 
understand how to connect with these local workforce systems. 
This is especially critical because their soldiers separate 
from the military one or two at a time, requiring much 
individual work.
    The best part about this strategy is that it is already 
paid for. Let us make the most of the resources already out 
there.
    A third option is to provide tax credits to assist small 
employers when National Guard and Reserve soldiers are 
deployed. In our experience, employers want to do the right 
thing. Small employers, however, have a difficult time bearing 
the substantial cost of training an employee to replace a 
deployed soldier. The result of this is some hesitation in 
hiring members of the Guard or Reserve. A tax credit to cover a 
portion of the replacement training costs would be very 
helpful.
    Finally, assure that military credentials are fully 
transferrable. This already occurs in many arenas, but remains 
a challenge in others. It will require close coordination 
between the military and State licensing authorities for many 
occupations, especially in industries such as health care and 
transportation, where demand is high. Both classroom and hands-
on experience should be transferrable.
    I look forward to continuing our work with Senator Murray 
on these issues and I thank all of you for your commitment to 
the success of our returning soldiers. I would be happy to 
answer any questions.
    Senator Isakson. Thank you, Ms. Nisenfeld.
    [The prepared statement of Ms. Nisenfeld follows:]
                  Prepared Statement of Lisa Nisenfeld
    Mr. Chairman and members of the subcommittee, thank you for the 
opportunity to talk with you today about employment issues for 
returning Reservist and National Guard soldiers.
    The efforts of many employers to assure continued employment for 
our returning National Guard and Reserve veterans in both the public 
and private sectors is truly outstanding. These organizations well 
deserve the Nation's recognition and thanks. Much more needs to be 
done, however, to make sure that all our returning National Guard and 
Reserve soldiers are employed and economically stable. The challenges 
facing these heroes are complex.
    Last spring approximately 700 Oregon National Guard soldiers 
returned home, many of them residents of southwest Washington. Fully 40 
percent of them were unemployed upon return. Another group of 700 is 
scheduled to return next month. Of these, at least 30 percent 
anticipate being unemployed. An equal number consider themselves to be 
``underemployed.'' This occurs as our region's economy is in the midst 
of a strong recovery. So while the employment prospects for the public 
at large have improved, the options for our reentering service people 
are not as bright.
    In Washington State, citizen soldiers demobilized from the 
Washington National Guard's 81st Brigade also demonstrated a 40 percent 
unemployment rate among 1,000 returnees. The largest number of these 
unemployed soldiers were jobless when they entered the Guard. To them, 
the challenges of securing gainful employment are even greater. They 
tend to be young people who have little, if any, college education. 
Some of them were students. Others were ``downsized'' during their 
service.
    The transition for many of these soldiers has been very, very 
difficult.
    Upon first returning to civilian life, they are provided with a 
substantial amount of information regarding employment and education 
resources in their communities. That information, however, often falls 
upon deaf ears because the soldiers aren't ready to jump into a job. 
They face many pressing issues: reintroduction to their families, 
housing, debts, and health challenges. So the usefulness of the 
information presented at demobilization is often limited.
    Further, those who worked low-wage, low-skilled jobs are no longer 
satisfied with that. During their deployment they learned many 
technical skills, living in intense and demanding situations. They 
developed a maturity unlike that of others their age. Their 
expectations for work and family have changed substantially, yet they 
often come home to minimum wage jobs, debts, and challenging family 
situations. They may have physical and mental challenges as well, 
resulting from their service.
    So they are given 3 weeks (or less) to decompress prior to re-
entering civilian life.
    How can we help solve these challenges? There are a variety of 
possibilities.
    1. Provide military salary and benefits during a transitional year 
so individuals can afford to go to school. A wide variety of resources 
are out there to help pay tuition and fees for vets returning to 
school, yet many have young families and financial obligations which 
preclude full-time education. Our economy needs these young people to 
pursue higher education and technical credentials, so this would be a 
sound investment.
    2. Encourage civilian and veterans organizations to work together 
to reach out to returning soldiers. Congress has funded a comprehensive 
system of one-stop employment centers throughout the country. Those 
centers consider returning veterans to be their top priority population 
for services. For the most part, however, those programs are not 
connected directly to the various military organizations that are 
demobilizing soldiers. These programs stand ready to actively reach out 
to returning vets as well as their dependents, yet most are mystified 
about who to call and how to connect. Our system regularly mobilizes 
resources to deal with large layoffs and plant closures. Surely our 
experience in ``rapid response'' can be applied to working with these 
men and women.
    Making these connections is especially challenging for Army Reserve 
units such as the 104th Division in Vancouver because they draw 
soldiers from 12 States. They need to better understand how to connect 
with local workforce systems. This is especially critical because their 
soldiers separate one and two at a time, requiring much individual 
work.
    The best part about this strategy is that it is already paid for. 
Let's make the most of the resources that are already out there.
    3. Provide tax credits to assist small employers when National 
Guard and Reserve soldiers are deployed. In our experience, employers 
want to do the right thing. Small employers, however, have a difficult 
time bearing the substantial cost of training an employee to replace a 
deployed soldier. The natural result of this is some hesitation in 
hiring members of the Guard or Reserve. A tax credit to cover a portion 
of the replacement training costs would be helpful.
    4. Assure that military training credentials are fully 
transferable. This already occurs in many arenas, but remains a 
challenge in others. It will require close coordination between the 
military and State licensing authorities for many occupations, 
especially in industries such as healthcare and transportation where 
demand is high. Both classroom and hands-on experience should be 
transferable.
    I look forward to continuing our work with Senator Murray on these 
issues. I thank all of you for your commitment to the success of our 
returning soldiers. I would be happy to answer any questions.

    Senator Isakson. Mr. Fry?
    Mr. Fry. I would like to thank Senator Burr for the 
introduction. Mr. Chairman and members of the committee, I have 
the honor to speak to you as a representative of both the 
Wachovia Corporation and as a citizen soldier.
    When reservists deploy, they must rely on a support network 
that includes the businesses that they work for or own. In my 
experience, that level of support varies widely. I would like 
to detail the outstanding support that I received as I prepared 
to mobilize, mobilized, deployed, and redeployed in support of 
Operation Iraqi Freedom and to relate to the committee what 
that level of support means on a personal level.
    At the time of my initial alert, Wachovia's existing 
corporate policy was already what I consider generous, 
providing for continued full pay and benefits for 6 months in 
the event of activation. In March of 2003, the corporation 
extended this policy to 1 year in recognition of the sacrifices 
being made to support the war on terror as more Wachovia 
employees joined the active ranks. Wachovia has since continued 
to extend that policy in subsequent months in support of our 
employees called to extended active duty for Operations 
Enduring Freedom and Iraqi Freedom.
    Let me explain what these benefits meant to my family. As 
an active duty Sergeant First Class, my pay was less than half 
of what I had been making at Wachovia, even factoring in the 
additional allowances for the combat deployment. To compound 
this, my wife had to leave her job, which involved night and 
weekend work that she would no longer be able to perform since 
I was not there to care for our children. Day care was not 
available during those periods, and her employer would not 
grant her a leave of absence, so she was forced to resign and 
subsequently lost her benefits.
    I was faced with the prospect of losing two-thirds of our 
annual income and benefits for my family while being halfway 
around the world and not being able to do anything about it. 
While Tricare health benefits began upon my activation, they 
involved a change in medical service providers and new and 
unfamiliar paperwork. Without the financial support from 
Wachovia and the extended benefits, we would have been in 
serious trouble. Not having to worry about my family's 
financial condition or health benefits gave me a great sense of 
relief and made it easier to focus on my duties.
    I was initially concerned that the one-year policy would 
leave a period where I would only have the Army salary. 
However, the extensions to the policy ensured that I was 
covered for the entire period of my service. The company also 
maintained the employer matching of my 401(k) funds, allowing 
me to continue pursuing our savings goals. Wachovia also 
counted my military service as qualifying toward the company-
funded pension plan. I was also paid my full incentive plan 
bonus for 2003, even though it could have been prorated to 
exclude the 3 months that I was on active service. These 
measures ensured that my future financial goals weren't 
derailed by the deployment.
    During the call-up process, I had a lot of questions and 
was relieved to find the answers readily accessible. Wachovia 
has the entire military policy on its Web site with frequently 
asked questions and linked me to a human resources 
representative whose support allowed me to plan thoroughly for 
the change. My Wachovia management team worked with me 
throughout the process and expedited it, when possible. My 
employer didn't just make policy that benefited reservists, 
they made it easy to access and receive these benefits. The 
company continued to count my years of service while I was 
gone, and when I returned, paid me retroactively for a raise 
that I would have received in 2004 had I not been activated.
    My coworkers sent me a copy of a corporate newsletter 
applauding deployed Wachovia reservists that was published in 
the fall of 2004. There, I learned I worked for a company that 
the ESGR had named an outstanding employer, although by that 
time, I already knew that I worked for an outstanding employer.
    I also learned that on October 13, 2004, Wachovia teamed 
with the Charlotte Chamber of Commerce and the ESGR to sponsor 
a salute to the troops in the atrium of Wachovia's corporate 
headquarters. This public demonstration of Wachovia's ongoing 
support makes me very proud to be a part of this company.
    Upon my return to work in March of this year, I submitted a 
letter to the ESGR detailing the level of support that I had 
received from Wachovia and was pleased to see this letter 
included on Wachovia's military support webpage that was used 
as a source of information in consideration for the 2005 
Secretary of Defense Freedom Award. Wachovia subsequently was 
awarded this honor here in Washington last Saturday, on October 
15, 2005. Upon the announcement of the Freedom Award, the 
military's highest honor for a civilian employer, Wachovia 
interviewed several recently deployed reservists and broadcast 
our stories of support through company print and visual media.
    CEO Ken Thompson stated in a release at that time, 
``Wachovia is proud to support the men and women who are 
serving our country and we are honored to receive an award that 
demonstrates our unwavering commitment to them. Their selfless 
service exemplifies the values that we work hard to live up to 
every day--integrity, respect, teamwork, service, personal 
excellence and accountability, and winning.''
    I would also like to relate the level of support that I 
received from the employees of Wachovia. Soon after the 
deployment, my department made me aware that they were starting 
a fund to donate airline miles so that my family could visit 
relatives while I was deployed. My wife and two sons were able 
to travel to Pennsylvania during the summer months and visit 
relatives thanks to their generosity.
    During deployment, I received from current and past 
coworkers more than 50 large and unbelievably well-stocked care 
packages that I was able to distribute to my battery. The flood 
of donations became so overwhelming that I started to donate 
large quantities of items to other units attached to the 1st 
and the 33rd Field Artillery whose soldiers were not as 
fortunate as us to have such a dedicated support channel. The 
regular Army soldiers were amazed when I told them I had 
received all the items from work, and I was proud to tell them 
about the company and my experience.
    The care packages included disposable cameras, food items, 
toiletries, games, books, magazines, signed banners of support, 
sunblock, lip balm, insect repellant, and curiously, a 12-and-
a-half pound box of sugar packets, which the coffee drinkers in 
the platoon took as a godsend. I also received Wachovia office 
forms in case I was missing work too much. I can't begin to 
imagine the effort involved, and I am sincerely grateful.
    I received countless letters and e-mails extending support 
and prayers and discovered that my colleagues had told our 
clients about my experiences. Some of these clients, in turn, 
also started to send letters, e-mails, and packages to support 
me and my soldiers in the field.
    Upon returning, I received an outpouring of support, not 
only from my teammates, but also from individuals throughout 
the corporation, as I learned that my team had been sharing my 
correspondence from Iraq throughout the company. I had an ever-
larger group praying for my unit's safe return and I am still 
struck when someone whom I don't recognize will come up to me 
and thank me for my service and share with me that they, too, 
were praying for our safety.
    Upon my return to work in March of this year, my Wachovia 
teammates helped me raise over $2,000 for a severely wounded 
soldier in my platoon. My business unit donated over $1,000 to 
a local nonprofit, VALOR, which was conducting a fundraiser for 
my wounded soldier. And through the Wachovia charity matching 
funds program, We Give, the corporation donated a matching 
amount.
    Again, I take great pride in detailing the encouragement 
and assistance that I received as I deployed with the 30th 
Brigade, North Carolina Army National Guard to Operation Iraqi 
Freedom. Over the 17 months of the deployment process, Wachovia 
was more than an employer with deployed reservists. Wachovia 
was a partner to me in the deployment. The company has created 
a culture of encouragement for its reservists consistent with 
our core values.
    The experiences of the soldiers in my unit who did not 
receive the same level of support made me all the more grateful 
for my experience. It also made me acutely aware that more 
could be done to convince the employers of the thousands of 
reservists still on or entering active duty to fight the war on 
terror how vital their support is to the citizen soldiers at 
home and downrange. Thank you.
    Senator Isakson. Thank you, Mr. Fry.
    [The prepared statement of Mr. Fry follows:]
                  Prepared Statement of Ronald J. Fry
    Mr. Chairman and members of the committee, I have the honor to 
speak to you as a representative of both Wachovia Corporation and as a 
citizen soldier. When reservists deploy, they must rely upon a support 
network that includes the businesses that the reservists work for or 
own. In my experience, that level of support varies widely. I would 
like to detail the outstanding support that I received as I prepared to 
mobilize, mobilized, deployed, and redeployed for Operation Iraqi 
Freedom, and relate to the committee what that level of support means 
on a personal level.
    At the time of my initial alert, Wachovia's existing corporate 
policy was already what I considered generous, providing for continued 
full pay and benefits for 6 months in the event of activation. In March 
2003, the corporation extended this policy to 1 year in recognition of 
the sacrifices being made to support the war on terror as more Wachovia 
employees joined the active ranks. Wachovia has since continued to 
extend that policy in subsequent months in support of our employees 
called to extended active duty for Operations Enduring Freedom and 
Iraqi Freedom.
    Let me explain what these benefits meant to my family. As an active 
duty Sergeant First Class my pay was less than half of what I had been 
making at Wachovia, even factoring in the additional allowances for 
combat deployment. To compound this, my wife had to leave her job which 
involved night and weekend work that she would no longer be able to 
perform since I was no longer there to care for our children and 
daycare was not available during those periods. Her employer would not 
grant her a leave of absence, so she was forced to resign and 
subsequently lost her benefits.
    I was faced with the prospect of losing two-thirds of the annual 
income and benefits for my family while being halfway around the world 
and not able to do anything about it. While Tricare health care 
benefits began upon my activation, they involved a change in medical 
service providers and new and unfamiliar paperwork. Without the 
financial support from Wachovia and the extended benefits, we would 
have been in serious trouble. Not having to worry about my family's 
financial condition or health benefits gave me a great sense of relief 
and made it easier to focus on my duties.
    I was initially concerned that the 1 year policy would leave a 
period where I would have only the Army salary. However, the extensions 
to the policy ensured that I was covered for the entire period of my 
service. The company also maintained the employer matching of funds in 
my 401(k), allowing me to continue pursuing our savings goals. Wachovia 
also counted my military service as qualifying towards the company 
funded pension plan. I was also paid my full incentive plan bonus for 
2003, even though it could have been pro-rated to exclude the 3 months 
that I was deployed in that year. These measures ensured that my future 
financial goals weren't derailed by the deployment.
    During the call-up process I had a lot of questions, and was 
relieved to find the answers readily accessible. Wachovia has the 
entire military policy on its Web site with Frequently Asked Questions 
and linked me to Human Resources representatives whose support allowed 
me to plan thoroughly for the change. My Wachovia management team 
worked with me throughout the process and expedited it when possible. 
My employer didn't just make policy that benefited reservists; they 
made it easy to access and receive these benefits.
    The company continued to count my years in service while I was 
gone, and when I returned paid me retroactively for a raise that I 
would have received in 2004 had I not been activated. My coworkers sent 
me a copy of a corporate newsletter applauding deployed Wachovia 
reservists that was published in the fall of 2004. There I learned that 
I worked for a company that the ESGR had named an ``Outstanding 
Employer,'' although by that time I already knew that I worked for an 
outstanding employer.
    I also learned that on October 13, 2004 Wachovia teamed with the 
Charlotte Chamber of Commerce and the ESGR to sponsor a salute to the 
troops in atrium of Wachovia's corporate headquarters. This public 
demonstration of Wachovia's ongoing support makes me very proud to be a 
part of this company.
    Upon my return to work in March of this year, I submitted a letter 
to the ESGR detailing the level of support that I had received from 
Wachovia, and was pleased to see this letter included on Wachovia's 
Military Support web page that was used as a source of information in 
consideration for the 2005 Secretary of Defense Freedom Award. Wachovia 
subsequently was awarded this honor here in Washington last Saturday, 
on October 15, 2005.
    Upon the announcement of the Freedom Award, the military's highest 
honor for a civilian employer, Wachovia interviewed several recently 
redeployed reservists and broadcast our stories of support through 
company print and visual media.
    CEO Ken Thompson stated in a release that ``Wachovia is proud to 
support the men and women who are serving our country and we are 
honored to receive an award that demonstrates our unwavering commitment 
to them. Their selfless service exemplifies the values we work hard to 
live up to every day--integrity, respect, teamwork, service, personal 
excellence and accountability, and winning.''
    I would also like to relate the level of support that I received 
from the employees of Wachovia.
    Soon after the deployment my department made me aware that they 
were starting a fund to donate airline miles so that my family could 
visit relatives while I was deployed. My wife and two sons were able to 
travel to Pennsylvania during the summer thanks to their generosity.
    During the deployment I received from current and past co-workers 
more than 50 large and unbelievably well stocked care packages that I 
was able to distribute to my battery. The flood of donations became so 
overwhelming that I started to donate large quantities of items to 
other units attached to the 1/33rd Field Artillery whose soldiers were 
not as fortunate to have such a dedicated support channel. The Regular 
Army soldiers were amazed when I told them I had received all the items 
from work, and I was proud to tell them about the company and my 
experience. The care packages included disposable cameras, food items, 
toiletries, games, books, magazines, signed banners of support, sun 
block, lip balm, insect repellant, and curiously, a 12.5 pound box of 
sugar packets (which the coffee drinkers in the platoon took as a 
Godsend). I also received Wachovia office forms in case I was missing 
work too much. I can't begin to imagine the effort involved, and I am 
sincerely grateful.
    I received countless letters and e-mails extending support and 
prayers, and discovered that my colleagues had told our clients about 
my experiences. Some of these clients, in turn, also started to send 
letters, e-mails, and packages to support me in the field. I returned 
to an outpouring of support from not only my teammates but also from 
individuals throughout the corporation, as I learned that my team had 
been sharing my correspondence from Iraq throughout the company. I had 
an ever larger group praying for my unit's safe return, and am still 
struck when someone whom I don't recognize will come up to me and thank 
me for my service and share with me that they too were praying for our 
safety.
    Upon my return to work in March of this year, my Wachovia teammates 
helped me raise over $2,000 for a severely wounded soldier in my 
platoon. My business unit donated over $1,000 to a local non-profit, 
VALOR, which was conducting a fundraiser for my wounded soldier, and 
through the Wachovia charity matching funds program, We Give, the 
corporation donated a matching amount.
    Again, I take great pride in detailing the encouragement and 
assistance that I received as I deployed with the 30th Brigade, North 
Carolina National Guard to Operation Iraqi Freedom. Over the 17 months 
of the deployment process Wachovia was more than an employer with 
deployed reservists; Wachovia was a partner to me in the deployment. 
The company has created a culture of encouragement for its reservists 
consistent with our core values. The experiences of the soldiers in my 
unit who did not receive the same level of support made me all the more 
grateful for my experience. It also made me acutely aware that more can 
be done to convince the employers of the thousands of reservist still 
on or entering active duty to fight the war on terror how vital their 
support is to their citizen soldiers at home and downrange. Thank you.

    Senator Isakson. I thank all the members for their 
testimony. To Wachovia and to Colt and to Home Depot, you are 
shining examples to the business community, and the 
contribution you are making to our country and to our men and 
women who work for you and serve as guardsman or reservists is 
appreciated by your Nation very much.
    Ms. Bierman, tell me how you would envision the contract 
preference proposal that you made working.
    Ms. Bierman. I don't know if I would call it a preference, 
but I just think some kind of a bill----
    Senator Isakson. That was my word, that wasn't yours.
    Ms. Bierman [continuing]. Right. First off, we have been 
soliciting the Federal Government for 25 years and most 
recently for 4 years to help rebuild Iraq, now help rebuild the 
Gulf Coast, and the Federal Government, FEMA, Homeland 
Security, and the DOD. I was actually--it was kind of their 
idea when I met and I had a meeting with Secretary Rumsfeld. We 
were invited back to have a meeting with him in his private 
conference room last year after the awards and one of the under 
secretaries said, ``We owe you.'' And I said, ``Well, I never 
thought of it that way, and I don't want any handouts, but just 
help us get Government contracting opportunities, which we are 
working on anyway.''
    So that has come up. That particular under secretary 
actually took me to the Chief Procurement Officer for all chem-
bio personal protective gear and it didn't go anywhere. But I 
just think there needs to be a bill. There are bills out there. 
We have bills for small business. We have set-asides. I don't 
like that term. I don't like goals and I don't believe anyone 
owes us anything.
    But in this particular case, in order for me to continue 
the good that I do--I am a contributor to society and a good 
employer, and to continue--this has all cost me money, coming 
to receive these awards. You were kind enough to pay today, but 
most of the time I come to Washington, DC, it is on my--all the 
time, it is on my dime. I cannot continue to be a profitable, 
viable company without growing my business and the best way to 
grow the business is with the largest procurement agency in the 
world, the Federal Government.
    So I have been actively seeking contractual agreements 
there for 4 years and I could use a little help, and I know I 
am not alone. I think there needs to be some kind of a bill or 
a sponsorship or names of those of us that have supported the 
Guard and Reserve specifically in this case, that our name goes 
before those buying agencies, that they take a really good, 
hard look at us.
    Senator Isakson. Your testimony that when you lost 20 
percent of your employees due to deployment, in that same year, 
your profit reduction was 50 percent, that was a significant 
contribution that Colt made to the United States Armed Forces. 
Your recommendation is intriguing and certainly what Colt has 
done, and obviously what Home Depot and Wachovia, but in 
particular many small businesses do certainly is something that 
ought to be known and be a part of that process. The awareness 
alone of the contribution you are making ought to be a 
qualification at least for application purposes or knowledge 
purposes, if not anything else.
    I wanted to ask that question because I would like to 
follow up with you on that and see if there are not some ways 
that we can elevate the visibility of those that are providing 
goods and services that are also going above and beyond the 
call of duty on our men and women in the Guard and the Reserve.
    Ms. Nisenfeld, you made a comment--I think I heard it 
right--that said there are lots of one-stops around the 
country, and I don't know whether you were referring to the 
Department of Labor one-stops or private one-stops.
    Ms. Nisenfeld. Yes, the Department of Labor under the 
Workplace Investment Act.
    Senator Isakson. OK. You then said, I think, and tell me if 
I misheard this, that there wasn't a good connection between 
them and the military.
    Ms. Nisenfeld. Right. There are agreements between the 
Employment Service and the VA and other agencies to work 
together and there are veterans' reps in each agency. I think 
it would be more helpful if we were simply given names of 
soldiers as they return and let us go find them and seek them 
out rather than wait for them to show up on our doorsteps. 
There is a significant veterans' presence in each one-stop 
center, but we need to go beyond that. We need to use all of 
our resources to get these folks employed.
    Senator Isakson. Mr. Hollingsworth, can you help make that 
happen?
    Mr. Hollingsworth. Sir, I can certainly take that message 
back to the Secretary. We are more in the employer relationship 
business. We are not in the employee information business for 
the guys, but I think that is a great idea for us to take back 
and pursue.
    I know that General Blum has worked very diligently with 
that for the Guard because he has made a corporation with some 
folks called Helmets to Hardhats so that when they return, 
there is a job opportunity there for them. I think that this is 
something that we need to do more of. I think it is a no-cost 
item, it is just a matter of information flow and I would take 
that back, sir.
    Senator Isakson. I thought it was an excellent suggestion 
and the Department of Labor and the Department of Defense are 
two parts of the same Government. I know Senator Murray, 
Senator Jeffords, Senator Burr, and myself worked on The 
Workforce Investment Act and the one-stops and employment 
issues and there ought to be a good connection so that the one-
stops have that information and we can find those jobs for 
those veterans.
    My time has expired. We will go back and do a second round 
if other members would like to. Senator Murray?
    Senator Murray. Thank you very much, Mr. Chairman.
    Sergeant Fry, let me start with you. First of all, thank 
you so much for your service and pass my thanks on to Wachovia 
for really an incredible outpouring of support from them, and 
it sounds like your fellow employees, as well. Were you 
fortunate within your unit or were there a lot of members of 
your unit who had similar situations, or were there others who 
came back home and haven't been able to find a job?
    Mr. Fry. There is a wide variety of experience within my 
unit and I can speak to probably a battalion-sized element, 
maybe between 500 and 600 troops. We had troops that were 
receiving full differential and partial differential in pay. 
There were 7 of us out of 108, so that is not common.
    Now, again, probably 30 percent of my troops were either 
college students who were fresh out of high school or were 
unemployed, so that skews the numbers slightly. But of the 
troops we had that were activated, I am going to guess that 
probably half of those in the senior levels, even more so, were 
impacted financially.
    Senator Murray. Mr. Hollingsworth, are the employers you 
are talking to interested in hiring Guard and Reserve members?
    Mr. Hollingsworth. Yes, ma'am. As a matter of fact, there 
is just an incredible outcropping of support for these young 
Guards and Reserves coming back, not only the folks who are 
just returning normally but I have had opportunities to talk to 
many of the businesses out there that are making slots 
available for the folks that have had some severe injuries and 
they have promised that they will ensure that no one in this 
country that sacrificed will go without employment.
    Senator Murray. Have any of them mentioned to you any of 
the roadblocks or incentives that we can provide that would 
help encourage them to do that?
    Mr. Hollingsworth. No, ma'am. They are all willing to do 
it. There is nothing that the guys have said, we need to be 
incentivized about, at all. We are just willing to do it 
because we care about these young guardsman and reservists.
    Senator Murray. Ms. Nisenfeld, has that been your 
experience?
    Ms. Nisenfeld. I would say we have had more mixed 
experience. Employers certainly are anxious to tell, say that 
they support our troops. When it comes down to individual 
businesses, particularly small businesses, they are hesitant, 
and it is mostly fear of redeployment that we are hearing 
about.
    Senator Murray. I have heard that a lot, too, especially 
seeing the history of 13 and 14 months gone, back for 90 days, 
back out again to the Gulf Coast or a short time later back to 
Iraq.
    What can we do, and I have asked both Mr. Hollingsworth and 
Ms. Nisenfeld, what can the Federal Government do to help 
businesses manage that aspect of hiring a Guard or Reserve 
member?
    Mr. Hollingsworth. Senator Murray, I will go first, if it 
is okay, Lisa. One of the things that, as I go around the 
country talking to employers, that I ask them, we are the 
employer advocate within the Department of Defense, so I try to 
solicit information from employers so I can take it back and 
keep our Department informed as to what the atmosphere is out 
there toward Guard and Reserve service.
    Continually, I will hear employers say, and I am talking 
large and small employers, both public and private, that if you 
will give us one thing, and that is predictability, we can 
manage the rest. So, if you can tell us when they are going to 
go, when they are going to come back, and give us advance 
notice on both of those items, we can manage the rest. That is 
what our Department has really emphasized.
    Secretary Rumsfeld has said that we will give 30-day notice 
and certainly the Department of the Army, which is the largest 
employer, user out there of these shared manpower assets, they 
are really working hard to develop a predictable model so that 
employers will clearly know exactly when they can expect these 
young men and young women to leave and come back.
    Senator Murray. I am certain if that is implemented, that 
would help a lot. Is there anything else, Ms. Nisenfeld?
    Ms. Nisenfeld. I think that something on the order of an 
on-the-job training subsidy for replacement workers would be 
helpful, and this could be a very short-term approach to work 
with folks who normally we would expect to be training people 
for long-term positions. In this case, we would know that that 
person was going to be there for a short period of time. That 
would be an expected outcome. So just a little slight tweak to 
the system, we could provide that assistance.
    Senator Murray. Thank you. I see my time is running out, 
Mr. Chairman. I have to get back to the floor. I am managing 
the transportation bill, so I apologize, but I would like to 
submit some of my other questions for the record.
    Senator Isakson. Without objection.
    Senator Murray. And I would like to thank all of the 
panelists for being here today.
    Ms. Bierman. Could I quickly respond to your original 
question, Senator Murray, are small businesses and companies 
looking to hire or not? It has always been our policy, and, of 
course, way before we got into the war situations, but I always 
look for guardsmen and reservists because we do highly 
technical--repair SCBAs and breathing apparatus and gas 
monitors and sell them and repair them. I mean, those guys are 
so smart. They know this stuff. They have a mechanical 
background. So, like my last four technicians have been from 
the Guard and Reserves. So that is something I seek out just 
because of the knowledge, the work ethic that these folks have.
    Senator Murray. Thank you very much, Mr. Chairman.
    Senator Isakson. Thank you, Senator Murray.
    Senator Jeffords?
    Senator Jeffords. Thank you, Mr. Chairman. I would like to 
thank the witnesses for sharing their thoughts and insights. I 
would also like to submit my opening statement for the record, 
Mr. Chairman.
    Senator Isakson. Without objection.
    [The prepared statement of Senator Jeffords follows:]

                 Prepared Statement of Senator Jeffords

    Mr. Chairman, I would like to thank you for holding today's 
hearing on this very important issue. I would also like to 
thank the witnesses for being here today.
    Vermont has a long and proud tradition of a fine militia 
and dutiful citizen soldiers. The Green Mountain Boys, famously 
led by brothers Ethan and Ira Allen, first organized to protect 
their land claims against New York. In 1775, the Green Mountain 
boys captured Fort Ticonderoga from the British Army without 
firing a shot. We Vermonters still refer to our National Guard 
as the Green Mountain Boys.
    Today, there are hundreds of them currently serving in 
Afghanistan and Iraq. When Members of the Army or Air National 
Guard are called to active duty, they make a great many 
sacrifices.
    Today's hearing will help us better understand some of 
those sacrifices, and the sacrifices made by those employers 
and family members who do not wear the uniform, and still are 
strongly affected by this call to duty.
    Employers, especially those in rural areas and those who 
operate small businesses, struggle to make due without key 
employees for extended periods of time during deployments. This 
is a hardship felt all across our country.
    In Vermont, particularly in those communities that have a 
very high proportion of Guard members or Reserves serving in 
Iraq or Afghanistan, this strain on employers is felt acutely. 
A May 2, 2005, article from the Los Angeles Times tells the 
story of how long-term deployment is affecting soldiers, 
employers, and families in the small town Enosburg Falls, 
Vermont. Because so many of its citizens have been activated, 
Enosburg's men and women have felt the pains of separation more 
than most.
    I ask unanimous consent that a copy of this article be 
printed as part of this hearing's record.
    The reality of most families today is that both parents 
work outside the home, and managing the day-to-day life of 
families is a two-person job. When a soldier, airman, Marine, 
or sailor is deployed, family structures and their daily 
functioning are often severely affected. Any absence, 
especially absences of several months due to a deployment 
overseas, can be debilitating.
    The employers of family members are also affected, as the 
employee attempts to cope with greater burdens and fewer hands. 
In an effort to help families cope with this hardship, Senator 
Feingold and I introduced the Military Family Support Act of 
2005 this morning.
    This bill would allow Federal employees who are caring for 
the dependents of deployed service members additional 
flexibility in accessing the leave to which they are already 
entitled. This bill would also establish a pilot program, run 
by the Department of Labor, to provide businesses with guidance 
on how to be more flexible in administering leave for employees 
who are caregivers for dependents of our activated service 
members.
    The goal of the Military Family Support Act is to make life 
a little easier for those who remain behind. Our deployed 
soldiers are able to give their best only if they are confident 
that their families are doing okay on the home front.
    We must do our best to assist in this effort for those who 
are already giving so much to for their country.
    Mr. Chairman, thank you, and I look forward to hearing the 
testimony of our witnesses.

    Senator Jeffords. America's employers are proud of our men 
and women in uniform and we are proud of the efforts employers 
are making to keep the home fires burning while the troops are 
away. Employers, especially those in rural areas, those who 
operate small businesses, struggle to make do without key 
employees for extended periods of time during deployments. This 
is a hardship felt across the country.
    In Vermont in particular, in these communities that have a 
very high proportion of guardsman or reservists serving in Iraq 
or Afghanistan, the strain on employers, therefore, is acute.
    The reality of most families today is that both the parents 
work outside of the home, managing the day-to-day life of 
families and two-person jobs. When a soldier, airman, or sailor 
is deployed, family structures and their daily functioning are 
often severely affected. The employers of family members are 
also affected as the employees attempt to cope with greater 
burdens and fewer hands.
    In an effort to assuage this hardship, Senator Feingold and 
I introduced the Military Family Support Act of 2005 this 
morning. Our bill would allow Federal employees who are caring 
for dependents of deployed service members additional 
flexibility in accessing the leave to which they are already 
entitled. This bill will also establish a pilot program run by 
the Department of Labor to provide businesses with the guidance 
on how to be more flexible in administering leave for employees 
who are caregivers for dependents of our men and women serving 
overseas.
    The goal of the Military Family Support Act is to make life 
a little easier for those who remain behind. Our deployed 
soldiers are able to give their best only if they are confident 
that their families are doing okay at home.
    I understand that the witnesses have not had an opportunity 
to study this legislation. However, I would appreciate each of 
your reactions to my description of this legislation, and it 
will be available to you. I guess I am just going to go on to 
questions here. Do you see this legislation as necessary and 
helpful as I have described it? Do you see any problems with 
the OPM implementing the Federal employee provisions of this 
bill? Is it your experience that most employers are willing to 
be flexible in this regard? If so, for how long, and how do you 
think this program will be greeted in the private sector? Do 
you have copies? No, you don't. Sorry.
    Senator Isakson. Does anyone want to take a stab based on 
the Senator's description?
    Mr. Hollingsworth. Sir, I would just like to say that 
anything that we do for those families, that really does 
provide some really needed assistance to them, but it will have 
an impact financially on the employers and I think we need to 
look very closely at that. I would defer an answer as to how 
that would impact our employers to some of our colleagues here 
because they have a little bit better knowledge of their impact 
upon them from a financial perspective.
    But certainly we applaud anything that our employers do. 
They lean forward in such a terrific manner already and I just 
want to express my appreciation to all of those great Americans 
out there that have done what they have for our Guard and 
Reserves.
    Senator Jeffords. Thank you. Any other comment? I 
understand without a copy before you, I guess it is a little 
difficult.
    Thank you, Mr. Chairman.
    Senator Isakson. Thank you, Senator Jeffords.
    I am going to continue with a few more questions. I will be 
happy to let Senator Jeffords or any other Senator who comes in 
ask a few more, too, but there have been some very beneficial 
suggestions made and a couple of them haven't been mentioned 
and I want to follow up on them.
    Ms. Nisenfeld, again, I want to make sure I heard it right, 
because I was writing and listening at the same time, but you 
made a comment with regard to those leaving the military once 
they are coming home, and I think you were referring to 
reservists and guardsmen, because that is the focus of this, 
and I think you said the usefulness of the information provided 
them as they left was not helpful at the time and what you 
meant were they were leaving, they were going home, they were 
getting out, so they get a whole lot of information and then 
there was nothing to follow. Is that correct?
    Ms. Nisenfeld. That is correct. Sometimes, there are 
employment seminars down the road that have been funded in a 
variety of places and some of the soldiers participate in that. 
But at the time of separation, they are pretty much thinking 
about what they are going to do in the next 20 minutes, not 
long-term.
    Senator Isakson. Right. Lieutenant Colonel Izen, I am going 
to ask Mr. Donovan if he will share his microphone with you for 
just a minute. I don't want to catch you off guard. I know you 
weren't expecting it.
    First of all, we have thanked Mr. Fry for his service. We 
want to thank you and all the members here for their service to 
the country. But in light of that statement, and I know you are 
still associated with the Marine Corps and you aren't out 
looking for employment, but are you familiar in the Corps or 
any other branch of the service with how they are provided 
information and how much follow-up there is beyond severance?
    Lt. Colonel Izen. Sir, I am more familiar with, on the 
active duty side of the house, the TAP programs that were 
already addressed. I did serve as an advisor to a Reserve unit 
for 3 years. We mobilized reservists, but I left before we 
started bringing them back. I believe that Ms. Nisenfeld had it 
right. There are some programs that are out there, but 
generally speaking, these are National Guardsmen and Reservists 
that have been pulled away from their families and they are 
excited about getting home and it is very difficult to provide 
meaningful instruction in that short period of time.
    Senator Isakson. Sergeant Fry, or Mr. Fry, whichever you 
would prefer me to address you by, you were nodding your head 
vigorously there. Do you want to make a comment?
    Mr. Fry. It is a very quick process, Senator. When we came 
back--it took us 3 weeks of State active duty and 5 months of 
Title X Federal active duty to deploy to Iraq, and most of my 
troops were released, unless they were in a medical hold 
status, within about 7 days. After a 4 day family leave with 
almost 16 months receiving family separation allowance, you 
have to remember, when the guardsman deploys, they leave their 
families to go to training bases. They don't have the 
opportunity the active duty does. As they train up for 
deployment, their family is with them. So having been separated 
for almost 16 months, it is very hard to get them to focus on 
the benefits that they are receiving.
    Once separated, we have had follow-ups, and most of those 
are medical, dental, and counseling, but we have not received 
in my unit, in my experience, having been back now over 6 
months, we have not received any vocational or educational or 
other work-related information from the Government except on a 
one-off basis. Now, the local Veterans' Departments, once your 
name is in that database, they will contact you, and myself and 
my unit members have been contacted through the local veterans' 
organizations and VA.
    Senator Isakson. That is a very helpful point that you have 
made and both your comments lead me to believe there probably 
would be some things we could do to help get the branches of 
the service to have maybe a 90-day or 180-day after-severance 
period where they go back to the service men who had been 
deployed or the reservists and say, did you remember X, Y, and 
Z is available, and Senator Murray made a good comment.
    Since the liberation of Iraq and since Operation Enduring 
Freedom, we have come to recognize that there needed to be some 
equalization of benefits for guardsmen and reservists with 
regular active duty personnel, particularly because of the 
tremendous dependence we have had in this battle, and I think 
this is an area we can help. I think in active duty, there is 
better follow-up postseverance than there probably is in the 
Guard and Reserve and that is probably because we have been 
more used to having to do it with regular duty people and not 
used to having such a large component of our Reserves called 
up. So I appreciate that suggestion.
    A second suggestion that you referred to was a tax credit. 
I think I heard this right. You were talking about a tax credit 
to small businesses for the training of the person that fills 
the role of the reservist when they are called up, is that 
correct?
    Ms. Nisenfeld. Yes.
    Senator Isakson. So in other words, if I was--well, Ms. 
Bierman is a small business person. If she lost one of her 
people for a 9-month or 12-month deployment, then she could get 
a tax credit for the cost to train that person's replacement 
who is hired just for that temporary period of time, is that 
correct?
    Ms. Nisenfeld. That is correct. We have a standing formula 
for that, which is half the wage for 6 months in the Workforce 
Investment Act system. That would be a simple formula to apply.
    Senator Isakson. And you would do that at a small business 
threshold?
    Ms. Nisenfeld. I think it is most acute for small 
businesses.
    Senator Isakson. OK. Yes, ma'am?
    Ms. Bierman. I believe the SBA had a program, and it was 
like a $50,000 loan or something like that, and we found out 
about it. Deputy Secretary Melanie Sablehouse had said, 
``Christine, you need to go after this,'' and I think I missed 
the date by a couple of days. It was a year you had to go back. 
And it was actually, frankly, it was a loan. I don't need any 
more loans.
    Senator Isakson. There is a lot of difference between loans 
and credits.
    Ms. Bierman. You had to fill out tons and tons of paperwork 
to do it. It wasn't worth my time and energy and it would not 
have even covered the loss that we had in direct result to the 
sales and service in Jim's department, which was--but on two 
really positive notes, Jim, our Master Sergeant, Jim Mixco, who 
was a 9 year employee and director of all my technical sales 
and service, I mean, he sells directly to Homeland Security and 
fire departments and highly technical equipment, he was ready 
to retire, but then there was the stop-loss so he couldn't 
retire.
    He has gone on to, after all this is over, he has actually 
reenlisted and he is going to school now to get a degree in 
business. So he is always calling me on weekends now, tell me 
about this, how did you start the company? So he is writing all 
these papers. So he has reenlisted, but I keep hoping they 
don't take him away for very long, but reenlisted. He is going 
back to school.
    And then my young man, Specialist Joey Petry, has now left 
our company. He was an hourly employee in my warehouse and he 
has left the company to go to school full-time and I guess they 
are going on the GI Bill. So I think those are both very 
positive things that came out of the things that the Government 
has to offer our guardsmen and reservists.
    Senator Isakson. Well, it is a meaningful recommendation. I 
was sitting here thinking about what Home Depot and what 
Wachovia would think about a benefit, i.e. a tax credit for a 
small business that you might not propose for a larger one, but 
as I think about it, it is one thing for a company that has 
325,000 employees today, and it will go to 400,000 probably 
over the next 2 years. Actually, when you hire that replacement 
to take the job the guardsman did while they are activated, by 
the time that guardsman comes back, you need that trained 
employee and you are probably not going to replace that 
replacement. They will probably work somewhere in the system.
    The same thing would probably be true with the bank, 
whereas if it is 2 of 17 people, that is a huge impact on the 
business, and if you hired somebody, you probably wouldn't keep 
them once the person came back. So it is a worthwhile 
suggestion.
    And again, with your comment of the State of Washington, 
the 81st Brigade, 40 percent were unemployed, but I think you 
said most of those were unemployed when they were called up, 
too, most of them probably would have been more employable in a 
small business than a large business, I would guess.
    Senator Jeffords, did you have any further questions?
    Senator Jeffords. Yes. Mr. Fry, you mentioned that your 
wife had to quit her job when you were deployed because she 
could not get child care during nontraditional hours. How 
typical is this of a problem? Do you think that this is a 
widespread problem for activated guardsmen and reservists?
    Mr. Fry. Senator, I have noticed that at least in a handful 
of instances, we probably had four or five troops within my 
company-sized element that had similar problems. Child care, 
when you take one of the parents out of the equation, child 
care becomes increasingly difficult. If you are like the 
majority of my unit, around a metropolitan area, most of the 
guardsmen are not from that area. Most of their families are 
not from there. In some of the more rural units, yes, you have 
a much wider network of support. But around metropolitan areas 
where most of the National Guard and Reserves are, yes, that 
becomes a problem.
    There were at least five of us that had similar 
circumstances. And while the reservist is covered by Federal 
legislation, the spouses, they can't get a leave of military 
absence because they are not in the service.
    Senator Jeffords. Do others have comment on that?
    Ms. Nisenfeld. Senator, any health care professional who 
has to work odd shifts will tell you that getting odd-shift 
child care remains very difficult, even in urban areas. So 
soldiers who have spouses in those industries are--I totally 
agree with Sergeant Fry. They are having a very difficult time.
    Senator Jeffords. Any other comments?
    [No response.]
    Senator Jeffords. Thank you, Mr. Chairman.
    Senator Isakson. Thank you, Senator Jeffords.
    I have one last question. There was one last suggestion 
that was made about fully-transferrable military credits for 
employment certification. I take it what you meant by that was 
if they are a mechanic in the military or if they are a teacher 
in the military or something that requires certification in the 
private sector, that the military experience be prima facie 
evidence of alternative certification in the private sector, is 
that correct?
    Ms. Nisenfeld. That is correct, and there has been much 
progress on that topic nationally, I understand. It has been 
something of a challenge to get the different branches of the 
military, what the training consists of and then kind of 
reconcile one with the other. But for things that require State 
certification, driving trucks and many health care occupations, 
we really need to reconcile those two, and there are many 
different licensing boards to contend with in every State.
    Senator Isakson. Yes, and there are many different 
professional organizations that are into turf protection, and 
that is not a criticism of anybody, but I know--and I chaired 
the State Board of Education in Georgia, where we developed a 
Troops to Teachers Program where we gave alternative 
certification to retired military personnel to go into the 
classroom and teach on a fast-track method because of their 
experience and it worked extremely well, but there was a lot of 
reluctance by everybody else to let somebody else go in a 
different way or an alternative way.
    All those suggestions are very good. I want to thank Mr. 
Hollingsworth for his being here today and hope he will take 
the suggestion with connecting the one-stops and DOD together. 
I think that was an excellent suggestion.
    To representatives of Wachovia and Home Depot and Colt, 
thank you again for what you do for your country and for your 
employees who are serving our country.
    Ms. Nisenfeld, thank you for your very valuable 
suggestions. You are probably the closest person to seeing the 
problem and putting a face on it of anybody here, because these 
other people are the solution. You see a lot of the ones who 
are suffering because there aren't as many employers as we need 
doing these good things.
    We want to thank you all for your contribution to your 
country. Thank you for coming to this hearing and testifying 
today.
    Unless there is other business, and I am the last one 
standing and I don't think there is, this meeting is adjourned.
    [Additional material follows.]

                          ADDITIONAL MATERIAL

                         Colt Safety, Fire, Rescue,
                                                 November 12, 2005.
   Response to Questions of Senator Kennedy and Senator Jeffords by 
                           Christine Bierman
                      questions of senator kennedy
    Ms. Bierman, you are very generous to continue the salary and 
benefits of your reservists. As you testified, losing 20 percent of 
your workforce to deployments was obviously a strain on your firm. Many 
small businesses may not be able to survive the loss of a few 
reservists.

    Questions. At what point does the loss of reservists threaten the 
viability of a small business? What is the greatest hardship you faced 
as a result of the deployment of two of your employees?
    You suggested that the Government should increase the number of 
contracts to small business who support their reservists. What other 
incentives could the Government offer to encourage employers to do the 
right thing for their reservists?
    Answer. I will be very honest with you . . . the loss of Master 
Sgt. Jim Mixco directly impacted our business financially. That coupled 
with rising health care costs and fuel surcharge increases etc. almost 
took us down after 25 years in business.
    We continued paying Jim's full salary as other costs of doing 
business escalated. Being the forever optimist and certain we would 
close at least one of the many Government contracts we had been working 
on, we continued down the same path.
    After winning the Secretary of Defense Freedom Award, we were 
actually told by an undersecretary at the Pentagon that ``We Owe you 
and with what you have to sell, fits right in with what we buy.''
    He then was kind enough to seek out yet another avenue for me to 
call on for business. That call was with the Chairman of the Joint Chem 
Bio Warfare program. The person who specifies exactly what is worn by 
the soldiers. A few of those items are off the shelf items sitting in 
my warehouse on any given day. The Brigadier General told me I would 
have to go back to FedBiz Ops to look for opportunities. That is an 
area I had been soliciting since my first year in business 25 years 
ago.
    That is the infamous Government maze of an outsider and a small 
business trying to get their foot in the door. Agencies continue to 
give billions of dollars of NO BID contracts to the same big businesses 
and are not even questioned or held accountable for not meeting 
diversity or small business goals. These agencies can lose billions of 
dollars of tax payers dollars and not account for any spending . . . 
with no questions asked.
    I will never understand it . . . but while it is has begun to 
affect me personally and professionally, I am having great difficulty 
remaining quiet on the subject and have spoken to my Senator and the 
House Small Business Committee and the leaders office regarding these 
issues.
    Not even increasing, but affording a few contracts to small 
businesses like mine who go above and beyond the call of duty in 
supporting our Guard and Reserve, will assure our viability in business 
so that we can continue to do the good that we do. It will afford us 
the wherewithal to continue to be CONTRIBUTORS in our society. In 
addition to offering quality services at better prices and 
accountability when spending tax payers dollars.
                      question of senator jeffords
    Question. Please provide any comments you have in regard to the 
programs proposed in the Military Family Support Act of 2005, S. 1888. 
I would greatly appreciate having your insights as to how you would 
take advantage of this legislation or how this legislation could be 
improved. Thanks for your assistance.
    Answer. Both of Colt's employees who were activated and have now 
returned, are taking advantage of the GI Bill and enrolled in college. 
This is a very good thing.
    We as an employer did our part while they were gone to stay in 
touch with their families and offer support in their absence. Employers 
large and small can continue to support their Guard and Reserve when 
they too are compensated. And I do not mean with hand outs. It just 
makes sense that the largest procurement agency in the world, the U.S. 
Government would be happy and lucky to do business with those that have 
given extraordinarily to our citizen soldiers.
    Again I am asking your committee to author a bill that will 
compensate by way of Government contracts, those specifically small 
businesses that support our Guard and Reserve specifically in the way 
that Colt Safety, Fire and Rescue has done.
            Respectfully submitted,
                                       Christine J. Bierman
                                 ______
                                 
Response to Questions of Senator Kennedy and Senator Jeffords by Dennis 
                                Donovan
                      question of senator kennedy
    Question. What would you recommend that a model employer adopt to 
show support for guardsmen and reservists? Could you cite examples from 
your current employer, and past employer?
    Answer. Each organization should adopt practical policies that they 
can fully support and develop programs that make sense for their own 
organization, recognizing that all employers are different and have 
differing abilities to accommodate the needs of their workforce in this 
area. At The Home Depot, we feel it is extremely important to support 
those who are defending our rights and protecting our freedoms. Since 
2002, The Home Depot has had approximately 1,800 associates called to 
active duty for the current Iraqi conflict. The Home Depot has 
implemented an extended and enhanced leave of absence benefit for our 
deployed associates. In 2004, the company joined forces with the 
Departments of Defense, Labor and Veterans Affairs to launch Operation 
Career Front, an unprecedented program that supports America's military 
job seekers, including veterans, separating active duty service 
members, National Guard members, reservists and military spouses. Our 
support of the military stretches into our community efforts, as well. 
Through our Project Homefront program, the company donated $1 million 
and our associates gave back 1 million volunteer hours to repair the 
homes of deployed associates. Our commitment is something we take very 
seriously at The Home Depot.
                      question of senator jeffords
    Question. Please provide any comments you have in regard to the 
programs proposed in the Military Family Support Act of 2005, S. 1888. 
I would greatly appreciate having your insights as to how you would 
take advantage of this legislation or how this legislation could be 
improved. Thanks for your assistance.
    Answer. We have found that the model where Government gives the 
companies the flexibility to do what makes sense for each organization 
works very well. We view our support of the military as our 
responsibility to our country, and as a valuable investment in our 
company's future. All of the policies and programs we have developed to 
support the men and women who are defending our freedoms have been on 
our own accord. We were not told to implement these programs, but 
rather we chose to do so because our company feels it is important to 
take care of people who are defending our country.
     Response to Question of Senator Jeffords by Bob Hollingsworth
    Question 6. Please provide any comments you have in regard to the 
programs proposed in the Military Family Support Act of 2005, S. 1888. 
I would greatly appreciate having your insights as to how you would 
take advantage of this legislation or how this legislation could be 
improved.
    Answer 6. While commenting on this legislation is not in my area of 
expertise or responsibility, I conferred with members of the Personnel 
and Readiness staff and this is our response. The purpose of the act is 
to permit employees to use sick leave (including leave received under a 
leave transfer program) in the same manner as annual leave, in order to 
serve as a ``caregiver.''
    Current title 5 provisions limit use of sick leave to specific 
circumstances--e.g., caring for a family member who is incapacitated by 
a medical condition, attending to a family member who is receiving an 
examination or treatment. This proposal would permit a ``caregiver'' to 
use sick leave in the same manner as annual leave is used--i.e., it 
does not restrict use of sick leave to specific circumstances.
    A number of civilian employees, especially those employed by the 
Department of Defense, have close working/personal relationships with 
soldiers deployed to Iraq and Afghanistan. In many instances, the 
employees are spouses who are relatively new to the organization and 
who have not accrued large amounts of annual and sick leave. When a 
deployed soldier depends on an individual at home to assume family 
responsibilities, it is in the best interest of the Department to allow 
an employee (designated by the soldier as a caregiver) access to all of 
his or her available sick and annual leave. The caregiver can use the 
leave to accomplish the legal, financial, parental, and medical duties 
normally performed by the deployed soldier. Access to more personal 
leave (and any leave received under a leave transfer program) makes it 
less likely affected employees would be placed in a leave-without-pay 
status or forced to resign when performing duties necessary for the 
support of a deployed soldier and his or her family.
    Current provisions require that an employee be dealing with a 
``medical emergency'' in order to be a recipient of donated leave. This 
proposal would deem ``caregiver'' status to be a medical emergency--
thereby qualifying employees designated as caregivers to receive 
donated leave. This leave could then be used in the same manner as 
annual leave.
    Enactment of the enhanced leave flexibility would enable designated 
caregivers to more effectively fulfill their roles, and would thereby 
help maintain the readiness of the Armed Forces by helping to ensure 
adequate caregiver coverage during potential periods of prolonged 
deployments. This benefit will enable our Armed Forces to prepare for 
their family's well-being and security during their deployment, and 
will go a long way in easing the stress and burden associated with 
deployment.
    As a matter of policy, the Department of Defense (DOD) would 
encourage supervisors and managers of civilian employees to approve 
caregiver leave requests to the maximum extent possible without causing 
an adverse impact on mission accomplishment. The Department also would 
publicize caregiver leave user eligibility for DOD Component leave 
transfer programs to its workforce and encourage the Military 
Departments and Defense Agencies to ensure full employee support and 
participation.
    The legislation could be improved with the following changes:

     Do not require qualified employees to exhaust their 
personal sick and annual leave accounts prior to using leave 
transferred to them as required under the provisions of subchapter III 
of chapter 63 of title 5, United States Code (U.S.C.). Currently, 5 
U.S.C. 6333(b) reads ``A leave recipient may use annual leave received 
under this subchapter . . . except that any annual leave, and sick 
leave, accrued or accumulated by the leave recipient and available for 
the purpose involved must be exhausted before any transferred annual 
leave may be used.''
     Allow leave donors to donate sick leave as well as annual 
leave to caregiver leave recipients. Sick leave transfer is currently 
not possible under 5 U.S.C. 6332, which reads ``Notwithstanding a 
program under which annual leave accrued or accumulated by an employee 
may be transferred to the annual leave account of any other employee if 
such other employee requires additional leave because of a medical 
emergency.''
     Expand the definition of member of the Armed Forces in 
section 2(a)(1)(E) of the Military Family Support Act of 2005, S. 1888 
to provide coverage to Department of Defense civilian employees 
deployed in support of contingency operations. Civilian employees 
require the same degree of family support as do the active duty members 
with whom they serve.
     Delete the age requirement. This is an artificial 
limitation and may likely stand in the way of obtaining the services of 
a skilled and appropriate caregiver. As long as the Federal employee is 
deemed to be a suitable caregiver by the individual requiring the care, 
the Federal employee should be permitted to use sick leave to provide 
the care, regardless of age.

    We suggest that the committee consult with the Department of Labor 
and the Office of Personnel Management on the impact of the provisions 
that affect them.
     Response to Questions of Senator Kennedy by Bob Hollingsworth
    Question 1. General Hollingsworth, thank you for those positive 
stories about employers and the variety of ways they've supported our 
troops. How have the longer deployments--15 months and longer--affected 
employers, especially small or non-profit businesses?
    Answer 1. Employer hardships increase the longer the employee is 
gone. The smaller the business, the more significant the absence. 
Overall, many managers indicate 1 year is the maximum, not the optimum, 
period of leave.
    In a recent survey of Reserve component employers sponsored by the 
Henry M. Jackson Foundation for the Advancement of Military Medicine 
and the Uniform Services University of Health Sciences entitled 
Attitudes, Experiences and Intentions of Employers of Reserve Component 
Members Concerning Employee Participation in the National Guard and 
Reserve, roughly 15 percent of employers report a negative effect on 
operations as a result of the temporary loss of employees due to 
military service. Overall, the survey concludes that support for the 
Reserve components is very high, and appears to be durable, among all 
types of organizations and categories of managers.
    Employers' main concerns appear to center around the uncertainty of 
the timing and the durations of instances in which they temporarily 
lose an employee to military duty, not with the burden of compliance. 
Most suggestions made by employers for improving their compliance with 
USERRA relate in one way or another to receiving adequate advance 
notice of the pending temporary loss of an employee and limiting the 
amount of time they are away from the job.

    Question 2. GAO has just completed a report suggesting that the 
four agencies involved in protecting the rights of Service members are 
actually not serving our troops well. The agencies have incompatible 
information collection systems. Because no one agency is responsible 
for tracking complaints from start to finish, the claims can languish 
for months, or even years. Shockingly, GAO found that despite a 
requirement to collect information about reservists' civilian 
employers, the Department of Defense still lacks this information on 
nearly 40 percent of reservists.
    Obviously, complete information about civilian employers of 
reservists and National Guard members is a vital part of protecting 
Service members' rights and educating employers about their 
responsibilities. Would you support (1) having one agency perform 
oversight of complaints and (2) increasing collection of this critical 
information about civilian employers?
    Answer 2. Yes, ESGR strongly supports having one agency perform 
oversight of complaints. Currently, the collection systems are 
incompatible. The infrastructure of the data bases differ which creates 
a challenge for sharing and tracking data. The Department of Labor 
(DOL) has enforcement authority and many years of experience and 
expertise in dealing with the complaint process for Service members. 
DOL has an established system for data collection; therefore, it is 
uniquely qualified to oversee the complaint process and the collection 
of data.
    Concerning the second question, supporting increased collection of 
critical civilian employer information, Department of Defense answers 
with a strong yes. We have made the process as painless as possible by 
utilizing a web based application.

    Question 3. GAO conducted a survey of the ombudsmen, who are all 
volunteers performing the invaluable task of helping Service members 
resolve problems with their reemployment. The role will only grow in 
importance as more National Guardsman and Reservists return. GAO found 
that although nearly 100 percent of participants said they had 
completed basic ombudsman training, two-thirds said they hadn't had any 
advanced ombudsman training, and 80 percent had no mediation training.
    What plans do you have to increase the level of training for the 
ombudsmen and volunteers, and how can we assist in giving volunteers 
the level of training they need to support returning Service members 
more effectively?
    Answer 3. ESGR is pleased that GAO substantiated our statement--
nearly 100 percent of the ESGR Volunteer ombudsmen (711 as of December 
7, 2005), have received basic ombudsman training.
    Before January 2005, mediation training was considered ``advanced'' 
training and provided as a separate course. However, in January 2005 
the ombudsman basic course was modified to include mediation training.
    To provide mediation training to those ombudsmen who have completed 
the early version of the basic ombudsman course, our initiatives 
include developing web based interactive learning products. Our 
Strategic Plan for fiscal year 2006 identifies numerous training 
requirements and we are seeking resources to support the development of 
these distance-learning products.
    Finally, we are validating training needs by seeking input from 
those volunteers we serve. A training subcommittee has been chartered 
to validate assumptions made by the National Committee and to guide the 
comprehensive training needs of the entire organization.

    Question 4. Your testimony discussed examples of businesses that 
offer differential pay. Do you have any statistics about Service 
members who haven't been able to get differential pay or other 
benefits? Are there areas we should be pursuing to help Guard members 
and Reserves whose employers can't offer costly benefits for long 
periods of deployment?
    Answer 4. Many employers choose to go ``above and beyond'' what 
USERRA requires in supporting their employees who serve in the Reserve 
components. Differential pay is an example of an ``above and beyond'' 
human resource policy. ESGR encourages employers to go ``above and 
beyond,'' but we recognize that differential pay can carry a 
substantial price tag for the employer. Other examples of ``above and 
beyond'' support include recognition for employees who serve in the 
Reserve components and frequent communication with the employee and the 
employee's family while he or she is deployed.
    We are currently conducting surveys to determine how many employers 
go ``above and beyond.'' Over 4,400 employers have signed ESGR 
Statements of Support indicating that they have employment policies 
that go ``above and beyond'' the requirements of USERRA.
    The number one request we receive from employers is that we provide 
them predictability. They want to know when the guardsman or reservist 
will be needed, approximately how long they will be gone, and when they 
will return to work. The Department of Defense has made great strides 
to provide at least 30 days notice of activations. We encourage Reserve 
component members to communicate frequently with their employers before 
the activation, during the activation, and after the activation.

    Question 5. Have you heard examples of families who have no health 
insurance while one parent is deployed and the other parent works at 
home or works only part-time without benefits?
    Answer 5. I am not aware of any such examples. Employers of Reserve 
component members activated for less than 30 days must continue to 
provide their normal health insurance benefits. When a Reserve 
component member is activated for more than 30 days, the member and his 
or her dependents qualify for military healthcare benefits.
 Response to Questions of Senator Kennedy and Senator Jeffords by Lisa 
                               Nisenfeld
                      questions of senator kennedy
    On February 28th in Boston, I organized a Veterans Employment 
Summit, with leaders in the business community, State and Federal 
agencies, representatives from the Massachusetts National Guard and 
members of our armed forces to discuss the economic and health care 
challenges faced by soldiers and their families returning from Iraq and 
Afghanistan. Central to the discussion were the employment 
opportunities available to soldiers, and the most effective way to put 
the new skills they've learned overseas to good use back home in 
Massachusetts.

    Questions. I understand you've worked closely with veterans in 
Washington State to help them find jobs. What programs have worked well 
for you? What should we be doing to see that our veterans and 
reservists know about all the opportunities available to them?
    Answers. Many efforts are underway in Washington State to better 
connect the State's workforce development system with soldiers 
returning from active duty. We have raised particular concerns about 
returning National Guard and Reserve soldiers because the current 
pattern of deployment for these forces is unprecedented. Most Americans 
assumed that these individuals would simply return to their prior 
activities, not fully understanding the complexities of their lives 
following deployment. Because of this, it is difficult to say that any 
programs or strategies have worked well--it is simply too soon to say.
    It is encouraging to note, however, that the Senate's interest in 
this subject has engendered substantial activity in the States to 
address these issues. Senator Patty Murray has shined a light on these 
problems in Washington State, moving officials throughout the State to 
close gaps and align resources to help these soldiers re-enter their 
lives and communities with good jobs.
    Washington officials have discovered a way to cross bureaucratic 
hurdles and provide contact information on returning soldiers, 
including National Guard and Reserve members, to local One-Stop 
Employment Centers. In our region we will be actively and repeatedly 
reaching out to these individuals when they come home and for several 
months afterwards. We will not simply wait until they show up on our 
doorstep. We want them to know that we appreciate the sacrifices they 
have made for our Nation and that we will do our part to help them 
succeed. They are the highest priority customers for services under the 
Workforce Investment Act and we will work with them and track results 
for at least a year following employment.
    Washington officials are also working across agency lines to 
promote focused hiring programs among employers, to recognize exemplary 
employers (in concert with Federal efforts) and to assure that State 
and local human services efforts are working together on these issues. 
We recognize that there is a well-developed system to help traditional 
veterans and it is our intention that the State's efforts will 
complement and augment these services.
    A significant concern that many have voiced recently relates to 
mental health issues and the returning civilian soldiers. Many are not 
ready to jump back into jobs as soon as they return home. They need 
time to decompress and to address the many challenges that may have 
come up at home during deployment. Others may not experience mental 
health issues for several months following their return.
    The current system of health care for veterans is overloaded and 
has difficulty responding to these mental health needs in a timely 
manner. If these mental health issues are addressed in a timely manner, 
they are less likely to become major barriers that could eventually 
affect all aspects of the soldier's life eventually.
    We suggest that the Congress consider providing limited term mental 
health vouchers, similar to those provided to Hurricane Katrina 
victims, allowing community mental health centers to provide counseling 
for returning soldiers. Such counseling would occur in concert with 
employment services from the One-Stop Employment Centers. More serious 
cases would then be referred to the Veterans Administration for follow 
up.
                      question of senator jeffords
    Question. Please provide any comments you have in regard to the 
program proposed in the Military Family Support Act of 2005, S. 1888. I 
would greatly appreciate having your insights as to how you would take 
advantage of this legislation or how this legislation could be 
improved.

Summary of S. 1888

        To allow Federal employees who are caring for the dependents of 
        deployed service members additional flexibility in accessing 
        the leave to which they are already entitled. To establish a 
        pilot program, run by the Department of Labor, to provide 
        businesses with guidance on how to be more flexible in 
        administering leave for employees who are caregivers for 
        dependents of our activated service members.
    The goal of the Military Family Support Act is to make life a 
little easier for those who remain behind.
    Answer. We have anecdotal evidence that some caregivers have been 
forced to leave their jobs to care for others while the caregiver's 
spouse is deployed, although it isn't clear how extensive this problem 
is. When this situation occurs, the following elements may be helpful:

     Assign the caregiver similar high priority to that 
received by veterans in the Nation's One-Stop Employment system. An 
immediate family member in such a situation would often benefit from a 
job with a different schedule or improved arrangements for dependents.
     Consider allowing unemployment benefits for caregivers who 
must leave their jobs because of a deployment.
     Provide a technical support hotline for caregivers to 
learn about their options before deciding to leave a job. With some 
coaching, some people will be able to work with their employers to work 
out a more flexible employment arrangement. A hotline arrangement might 
work (if publicized appropriately through the military) because 
caregivers often have difficulty leaving the home.
     Consider expanding the ``soldier and family support'' 
model used by the Army Reserve. In our region a single staff person is 
responsible for hundreds of families across 12 States. This model 
(perhaps with some increase in staffing) should be considered for use 
with National Guard units as well. Further, these representatives can 
be assisted by One-Stop and other community resources if they are given 
some assistance in learning about the availability of those resources 
in various areas.

    Extending sick leave benefits for Federal employees is a good 
thought, but will have very little impact in our region. It will 
probably be more significant in areas with many Federal employees.
    It is less clear, however, that proposing to provide technical 
assistance to employers about how to apply sick leave benefits to 
caregivers will be a successful strategy. Some of the national human 
resource associations would probably be willing to step forward and 
help get information out to companies throughout the country--at little 
or no cost to the Federal Government. It is probably more critical to 
assure that the families of our service men and women know that their 
communities stand ready to support them through these difficult times 
and provide them with information on where to turn for help.
    Thank you for caring about these matters and please do not hesitate 
to contact me if you have further questions or concerns.

    [Whereupon, at 3:25 p.m., the subcommittee was adjourned.]

                                    

      
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